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Clorox Earnings Sparkle as Pandemic Spurs Double-Digit Sales Gains

Clorox posts earnings and sales that surpass forecasts as consumers scoop up its branded wipes and other products amid the coronavirus pandemic.

Clorox  (CLX) on Friday posted fiscal third-quarter earnings and sales that well surpassed analysts’ forecasts as the cleaning-products maker saw consumers scoop up its branded wipes and other products amid the coronavirus pandemic.

The Oakland, Calif.-based company said it earned $241 million, or $1.89 a share, vs. $187 million, or $1.44 a share, in the same quarter last year. Analysts polled by FactSet had been expecting earnings of $1.67 a share. Sales came in at $1.78 billion vs. $1.55 billion a year ago and also were ahead of analysts’ forecasts.

“Beyond the extraordinary growth in our disinfecting products, we saw broad-based growth across all four segments as our portfolio is uniquely positioned to serve consumers in this unprecedented time,” CEO Benno Dorer said in a statement.

Indeed, beyond obvious gains in its household cleaning and disinfectant products, which consumers faced shortages of at the start of the pandemic, sales of other products including garbage bags, cat litter and dietary supplements also performed well, the company said.

That combined with “strong cost savings performance” helped push third-quarter gross margin up by 330 basis points to 46.7% from 43.4% in the year-ago quarter - the sixth consecutive quarter of year-over-year gross margin expansion, Clorox said.

Year-to-date net cash provided by operations was $806 million, compared to $603 million in the year-ago period - an increase of 34%.

The company also raised its guidance for the remainder of fiscal 2020. For the rest of its fiscal year, Clorox now anticipates per-share earnings of between $6.70 and $6.90, above the $6.60 currently expected by analysts polled by FactSet.

“With a portfolio that's been relatively resilient during past recessions, the heightened importance of disinfecting products in consumers' lives and strong future investments in our IGNITE strategy, we're optimistic about our ability to continue to perform well even in what's expected to be a challenging economic environment,” Dorer said.

Shares of Clorox were up 3.52% at $193 in premarket trading on Friday. 

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