Clorox full-year profit forecast hit by higher commodity, freight costs

(Reuters) -Clorox Co on Friday forecast full-year earnings below estimates and said gross margins would drop, blaming higher manufacturing, commodity and logistics costs that have been plaguing the consumer goods industry.

Shares of the company, which benefited from the pandemic-driven hygiene focus, fell about 6% in pre-market trading as the bleach maker also posted its first contraction in quarterly gross margins in 10 quarters.

Consumer product companies have been battling higher prices for commodities, including pulp, resin and petrochemical products, due to transportation hurdles caused by the pandemic.

Clorox projected diluted earnings per share of $5.94 to 6.14 for its fiscal year 2021 that ends in June, compared with its prior forecast of $8.05 to $8.25.

The company cited higher input costs, one-time non-cash charges of $2.11 per share related to a devaluation of its vitamins and minerals business offset by a 60 cent per share gain from its stake in its Saudi Arabia joint venture for the revised forecast.

Excluding those items, Clorox estimated adjusted earnings per share of $7.45 to $7.65, which came in below the $8.35 analysts had expected.

Net sales for the three months ended March 31 were flat at $1.78 billion, missing the $1.87 billion analysts on average had expected, according to Refinitiv data.

Clorox blamed lower shipments of cleaning and disinfecting products to retail and professional customers, when compared to year-ago levels at the height of the pandemic, as well as supply constraints for some key products.

Third-quarter adjusted earnings came in at $1.62 per share, above the $1.48 analysts expected.

Source: Read Full Article