Top Companies Report

14. Church & Dwight Co.

July 13, 2010

Princeton, NJ
609.683.5900
www.churchdwight.com
Sales: $2.3 billion


Sales:
$2.3 billion for household, personal care and oral care products. Corporate sales: $2.5 billion. Net income: $249 million

Key Personnel:
James R. Craigie, chairman and chief executive officer; Matthew T. Farrell, chief financial officer

Major Products:
Household—Arm & Hammer Baking Soda, Arm & Hammer Fridge Fresh, Arm & Hammer Clumping Litter, Arm & Hammer Clean Shower, Arm & Hammer Scrub Free, Orange Glo Wood cleaners, Kaboom Scrub Free! Continuous Toilet Cleaning System, Kaboom Ultra Scrub, Kaboom Shower, Tub & Tile Cleaner, Arm & Hammer liquid laundry detergent, powder laundry detergents, Fresh ‘n Soft fabric softener sheets and liquid fabric softener, Arm & Hammer Essentials liquid laundry detergent and fabric softener sheets, Arm & Hammer Wet Dryer clothes, Arm & Hammer with OxiClean detergent, OxiClean laundry stain remover, OxiClean versatile stain remover, OxiClean baby stain soaker, OxiClean baby stain remover, OxiClean Max Force laundry stain remover, Xtra liquid laundry detergent; Parson’s Ammonia, Cameo. Personal Care—Arm & Hammer toothpaste, Arm & Hammer Spinbrush, Pepsodent, Aim, Close Up, Pearl Drops, Rigident, Arrid, Arm & Hammer Ultramax, Lady’s Choice deodorants, Nair, Nair Wax, Orajel

New Products:
Arm & Hammer Liquid laundry detergent; OxiClean Max Force Laundry Stain Fighter & Booster Liqui-gel, OxiClean Max Force Laundry Stain Fighter & Booster Power Paks, OxiClean Max Force Pre-treater Stick, Kaboom Foam-tastic Bathroom Cleaner, Arm & Hammer Essentials Power Gel Liquid Laundry Detergent, Arm & Hammer Plus OxiClean Stain Fighter Power Gel Liquid Laundry Detergent, Arm & Hammer Spinbrush Sonic Recharge; Arm & Hammer Kids Spinbrush My Way,Arm & Hammer Kids Spinbrush Thomas & Friends

Comments:
Corporate sales rose 4% and organic sales increased 5% over the previous year driven by 7% growth in the consumer products business. Company executives credit the growth to the success of eight “power brands,” which include Arm & Hammer, OxiClean, Spinbrush, Nair, Orajel and Xtra. At the same time, the company noted that three initiatives enabled C&D to thrive during the downturn. These include:
• An aggressive cost savings program that has been in place for several years. During that time, the company has delivered 570 basis points of gross margin improvement, excluding restructuring charges.
• Multi-channel distribution. The company was able to weather the economic downturn as it plays in both the premium (60% of revenue) and value (40%) channels.
• Relationship building. The sales and marketing teams did an outstanding job in developing stronger relationships with key retailers and consumers.
Fast Fact:
James A. Church, son of the company founder, operated a spice and mustard business known as the Vulcan Spice Mills. In Roman mythology, Vulcan is the god of fire, and the A&H logo represented the arm of Vulcan with hammer in hand about to descend on an anvil.

In other moves, the company completed construction of its new integrated laundry detergent manufacturing plant and distribution center in York County, PA and closed its North Brunswick, NJ complex. The new facility began production ahead of schedule during the third quarter. Elsewhere, C&D sold several non-core brands, increased marketing spending to drive trial and loyalty, and continued to focus on a wide variety of supply chain initiatives to expand gross margin.

Of course, new products are the lifeblood of any consumer products company, and new launches from C&D between 2007 and 2009 accounted for 15% of sales last year. To keep the momentum going, C&D has introduced several new products this year including Arm & Hammer Plus OxiClean Power Gels laundry detergents, OxiClean MaxForce stain fighters, Kaboom Foamtastic household cleaning products and line extensions to the Nair Shower Power platform.

The strong results continued into 2010, as first quarter sales rose 9.2% to more than $634 million. The gains were credited to higher sales of A&H liquid laundry detergent, Super Scoop cat litter, Nair, Orajel, Aim toothpaste and Kaboom bathroom cleaner, all of which were partially offset by lower sales of Xtra liquid laundry detergent.

Looking ahead, chairman James R. Craigie is optimistic about the remainder of the year.

“We are launching our best new product lineup ever in 2010 and the customer response has been excellent with distribution gains across almost every key category,” he noted. “We expect to deliver organic sales growth of approximately 4-5% in 2010 based on our strong pipeline of innovative new products supported by effective marketing programs."
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