Church & Dwight backs FY23 adjusted EPS view $3.15, consensus $3.16

“We now expect full year 2023 reported sales growth to be approximately 9% (previously 8%) and continue to expect organic sales growth to be approximately 5%. Our marketing investments, new product innovation, and successful execution are all reasons that we continue to expect volume to be a driver of organic growth in the second half. This is impactful as organic growth was largely price driven for the 8 quarters prior to Q3.” Farrell continued, “We now expect full year gross margin to expand approximately 210 basis points (previously 200). This is an encouraging trend as we continue to move closer to restoring gross margins to pre-COVID levels. We continue to expect a double-digit percentage increase in gross profit in full year 2023. We are maintaining our full year EPS outlook, with higher revenue and gross profits being offset by higher marketing and SG&A dollars. We continue to expect marketing as a percentage of net sales for the full year to be 11.0% (Full year 2022 was 10%). As in past years, when we have strong business performance, we invest for the future. Our investments will focus on driving future growth with higher marketing investment, R&D investment and accelerating product registrations in international markets as well as driving efficiency, including investments in automation and technology. Other expense for 2023 is now expected to be approximately $95 million (previously $100 million) and we expect our tax rate to approximate 22%. Cash flow from operations is expected to be approximately $1.0 billion, an increase of 13% compared to 2022. We now expect 2023 capital expenditures of approximately $230 million (previously $250 million) as we make capacity investments for the future. We expect annual Capex spending to return to historical levels (approximately 2% of sales) in 2025. We continue to pursue accretive acquisitions that meet our strict criteria, with an emphasis on fast-moving consumable products, similar to our last 3 acquisitions (HERO, THERABREATH, and ZICAM).”