Church & Dwight (CHD) 3 Nov 232023 Q3 Earnings call transcript

Good morning, ladies and gentlemen, and welcome to Church & Dwight's Third Quarter 2023 Earnings Conference Call.

Before we begin, I have been asked to remind you that on this call, the company's management may make forward-looking statements regarding, among other things, the company's financial objectives and forecasts. These statements are subject to risks and uncertainties and other factors that are described in details in the company's SEC filings.

I would now like to introduce your host for today's call, Mr. Matt Farrell, President and Chief Executive Officer of Church & Dwight. sir. ahead, go Please

Dierker, operator. questions. I'll everybody, of begin turn the to And you, wrapped Rick joining we'll up, QX thanks us I'll open Rick over call today. with up the CFO. Good Thank When and is for morning, call for results. our Okay. a review

also which beginning XXXX. Reported X.X%, revenue So let's fourth our the revenue QX is exceeding X% consecutive quarter Organic up X.X% our It's with note XX.X%, exceeded growth, outlook. begin. QX of our outlook. expectations. solid consumer which exceeded worthy results our that X% was organic business grew of posted global

way, growth. point our other accounted business of the for negative X Going SPD

sales call EPS higher-than-expected basis margin quarters, sales. the growth outlook, increased and gross XX.X% X to of Gross volume and is in positive $X.XX $X.XX, than was our in year. was volume to driven growth XX out by X.X% sales marketing expanded expectation the the in that expansion. margin basis of It's first points points Adjusted finish XXX is QX that result EPS continue growth positive important and QX. our $X.XX which and higher the will It's percentage as out to a

online continue in XX% the our the we purchased But to XX% QX grow compared to year-ago class of online trade. of in global in sales were quarter.

low and in Just we a most U.S. watch. that remains is our on the markets. closely Unemployment comments Unemployment major stat a few economy. the of in international

Mortgages auto higher prices. interest of debt gasoline repayments are Why? costly. household, as is loans lower card higher lead are balance credit oil higher Regarding sheets and the more restarting. to are savings consumer loan and health higher. are Student rates may stretched of and the Because more

XX% cost trade especially are of best higher that categories. consumers for down environment well positioned this for our down as in value is trade we leads products. value, look given a to our household portfolio So the And

going Now on each I'm business. comment to

strong the was of X.X% share is or up posted X.X% brands growth for consumer grew our of sales represent quarter. business gained brands market X our XX% the organic First XX U.S. the power that context, held of U.S. which The in share And sales. U.S. volume-driven.

label closely news Private that another is stat share our private The categories weighted we is good label is average here watch. in stable. the market

value part Now continues liquid with at I starting HAMMER it brands a more of behind and categories that advertising & media consumption laundry. by look new ARM which to times. few to continued to HAMMER the the our economic trade laundry in Give important value in campaign the by ARM the support driven in see want offers down celebrates & tough growth the great U.S., Hammer

category share in X%. at detergent held liquid We're HAMMER & quarter as ARM share XX.X% now laundry grew the the and extra.

value X.X% consumption grew and share increased Our market X.X%. extreme offering to

laundry & ARM an have the delivering performance to that HAMMER while a mess-free, form planning experience. eliminates that consumers it's on bottle waste is and products, sheet first unit HAMMER a a major laundry brand sheets convenient U.S. the from new & form ARM in the a detergent, unit entirely delivers rely new of lightweight trusted of Regarding love. as detergent and It detergent powerful launched sheets dose plastic laundry we Power new dose power is detergent new come

Sheet In the during was launched item laundry product in detergent Day September Prime online September, We Power #X the August. Amazon's event.

in even to more which will we're a broadly roll great out this So with start XXXX. innovation, off

share X% almost & Now which to litter, to continues HAMMER XX%. category, also ARM outpacing up and perform extremely well with litter the growth XX% growing was

offerings. & ARM choose to continue consumers HAMMER Now litter

offers a is have black is box. owner. box, particular, our for as But cost-constrained value a driving in which litter offering, great orange it the steady for demand We the our cat premium growth

Our the to we new expands segment a off start solid are lightweight where as litter in distribution & ARM lightweight HAMMER clumping underrepresented is hardball today.

to Turning household now in dry to category personal penetration. care. awareness continue to as to through build we room invest trial awareness the and and The run drive build and we shampoo dry consumption grew BATISTE shampoo to XX% BATISTE especially quarter, have continue drive as sampling.

to total acquired continues category. of growing treatment all across around job be as and expand here subcategory, over trade. share. doing #X we Mintipatch Hero position captured potential. distribution deal is business. the grow, a patch Church of There to HERO, the to great was growth share which classes Dwight have October, brand still room the Retail at acne Hero acne its this last buzz market In The in continues XX% a spectacular run we and future team is & the

in more with share. a Similarly, Church the and rapid Dwight. doubled acquired since a acquisition has of In expect at be for been THERABREATH, Distribution which we XXXX, in to segment was position pace. share performing extremely #X THERABREATH is than and brand XX% share well almost gaining grower this breath took the a THERABREATH has non-alcohol date & over long-term the QX,

to couple depressed QX channel consumption our up stabilize was QX. slightly And businesses last to results that QX. of year, with continues coming in a to plan actually WATERPIK close Regarding WATERPIK in similar all

vitamins. to gummy Turning

half. in While Vitafusion our was first the to expectations close

to Our losses retailer now and back partly XX% then job is to many our consumers. supply regain XXXX. distribution in in to consumption And due confidence and was QX win retailers our down lapsed issues at due

Next up international. is

team driven Global the and OxiClean. of our growth international sales of and Volume more we Our Sterimar by most X.X% hygiene doing and follow. nasal a distribution across Sterimar are international subsidiaries our Group, was expect markets, contributed led great Hero to QX, this and X.X% broad-based Markets job organic growth, delivering in our and Both gaining is growth of by in

hurt sales to by finally, being called Organic this is And line imports. due XX%, inexpensive which decreased Specialty Products. product largely but is X MEGALAC,

We up just the closed remainder demand we growth our year delivered full while the in our MEGALAC, out I'm maintaining to positive wrap October reported strong for consumer saying products, volume sales growth raised a positive our second consecutive going we to expect strength outlook reflect QX. of Excluding SPD of and by a EPS quarter X%. for outlook. of

into with and We fourth to long-standing shareholders. Now well are to business. an reinvestment business. quarter, it's a a at health the we of the invest performing of the our going long Dwight practice is by opportunity when in understood Church the view respect & long-term is take well This

is Our working. model business

it contributing new our and track Acquisitions offerings are value product as coming are Our continue to over QX. Rick our brands color add to to products to we in to making new QX going we'll generation to us XXXX. on growth on I'm be our you significant and premium cash now some investments full in lineups And offerings. to TSR-accretive the one Innovative of and are year our the performing best portfolio. well positions have give and turn

right. morning, good with Thank All We'll and everybody. Matt, you, EPS. start

adjusted $X.XX, year. down EPS the prior at was Third X.X% on quarter

Matt $X.XX gross $X.XX our margin As higher-than-expected mentioned, growth the to was better expansion. sales due outlook, than and primarily

organically. XX.X% The up were in the by half organic up growth our total were was volume. sales Over X.X% sales quarter driven up organic X.X%. business Net and consumer of was

Hero pricing, manufacturing increase XX.X%, the a impact ago, higher margin volume, of Our and the net year third impact a acquisition, the point XXX to gross productivity primarily of basis quarter of was improved costs. from due

XXX XXX walk acquisitions points point me following: made basis by through of impact Gross basis and points points you basis positive bridge. positive drag Let the the was to up from price/volume a positive margin from mix, QX of due productivity, XXX offset inflation. basis from partially impact XXX a

to than year. percentage sales Marketing QX Marketing of last basis million, Moving as was expense higher $XX of or up XX.X% XX points marketing. was year-over-year a

and SG&A, to year-over-year improved investment performance, primarily SG&A points increased comp XXX adjusted For to Hero incentive higher the spending. due related QX business SG&A basis from acquisition

a $X.X to Other expense was average rates. higher increase interest $XX.X all-in due million million,

the year, million. now of For $XX other we expect full expense approximately

in the XXX income a benefit tax compared to was the increase the And state of as prior rate points an nonrecurring year quarter XX.X% For our tax, XXXX. included rate effective XX.X% for basis reduction. of

continue to rate full expect approximately to the XX%. We year be

And cash. now to

months million from increase acquisitions earnings, of working an impact the recent capital. XXXX, from cash million, activities $XXX positive $XXX X to the in including improvements cash was For and higher of due first operating

sales Turning full the to to be previous the reported X%, full growth outlook. approximately outlook up year from our XXXX year We now expect X%. of

up to reported XXX We full continue growth expect basis to basis sales XXX expect points. expand from now be to approximately organic points, gross X%. We margin year

This is to margins pre-COVID closer we encouraging an continue to move restoring to levels. gross trend as

year continue in percentage XXXX. expect in increase We a to profit gross full double-digit

last the XXXX. in million Looking couple higher well we below what to around years. costs at have inflation, $XXX we experienced of continue This is of expect manufacturing

bit many commodities higher. levels, commodity resins below prices remain and a year oil-based While prior are

We we continue percent expect full and in and as marketing of to of to higher dollars full XX% percent sales to expect as continue compared both year be to year a XXXX. to SG&A a be sales

strong incremental reserve is SG&A by to bad higher to given driven related than incentive our R&D situation. previous a investments, customer higher outlook performance compensation expected X be our debt specific

our performance, As and for product investment investments when the in well automation R&D marketing with markets growth studies have focus and we on strong driving including as in investment, invest investments accelerating business higher we technology. future including future, in driving registrations clinical past international years, dollar as efficiency, will

EPS adjusted year to talking approximately reminder, as that our growth of includes been SG&A. higher we've X%. full a marketing the expect be to continue and up EPS step We And guidance about

expect be from We full to $X year to operations flow billion. continue cash approximately

approximately return continue sales CapEx make X% now about expected full historical and is and levels of to capacity investments, $XXX year be to we expect we plan XXXX. Our by million CapEx of as to to

QX. to on Moving

reflects reported We HERO, contributing have X% and low-margin repeating laundry X% or organic, approximately breadth a volume Organic negatives promotions. and X% and from growth strong rate from outlook in growth some positives and with QX there not expect for litter of better. sales

in margin expansion expected gross increase XX% SG&A to share, significant Adjusted year. X% QX. $X.XX and from expect of is marketing year-over-year expected is and EPS in excess in per a be last be We increase marketing to both

marketing Matt to would strong inflection beyond. momentum expected, of saw So for of to build XXXX that, take spending volume point to and year happy on X we a behind the be investments as and with the summarize, we I and questions. months And and are us, growth

from [Operator first Rupesh from Oppenheimer. Parikh comes Your question Instructions]

Products just about how So Specialty the are the coming in starting the quarters. thinking you segment, with business

obviously, quarter, this a So decline. larger

for to you sense a weakness see few wanted if until quarters get issue that more Just the we cited. you a lap

-- Rupesh, it's to QX. be Yes, drag going to going it's in be a

down be that's business. consumer more But contribution the in So which as -- X% of kind where organic from we're yes, going quarter when for to the least of net SPD, QX, so a maybe X number we for call at QX well. reduces

Yes.

I or When many when think the growth is about look Rupesh, in marketing. you at times, also about we're investing, rate nuance, talk SG&A QX. we talked

really our take Sometimes or well, look some doing we businesses we low get when also unprofitable ahead -- and laundry. profitability. customer call We of at in promotions it profit like we're of

question. to good segue a That's my Great. next

So organic the sales growth was maintained year. for full

like that anything correct? Or promotions may your limited sounds sales what the detail? organic for it is on full -- laundry for is increase there have weighing those Is So growth else the lack lower-margin of organic year.

That's now, we quarter, a were fourth thought -- lot that promotions true. Last the had looking profitable. we we in year not had of back

we them. So called

which they're this volume. fourth to for place quarter, a going not so be lower obviously in results in And

a related just lack way those? follow-up, a -- those to just there promotions? to quantify running maybe of The the is And of impact Great.

that Easier now. is do do and over right when quarter to the

it's more it direct. Now a conjecture, is but

The Securities. Bill Truist from comes next from question Chappell

have for both terms distribution, and little a for of you where bit it HERO be? businesses moving those both tone? next kind of in where in we're growth trying of in your into of comps expect do talk about understand we Or the you year, to THERABREATH we Can to as terms is are tougher

is X, was year in say, the Remember, when we XXXX, distribution throughout year. let's were gaining

gains year a benefit distribution 'XX. the have all in versus full we'll XXXX of So

positive. So that's a

the is But for surprising naturally, demand once are got us. difficult more So the you've place. the comps product in

wherever In has we've the launched it. been fact, exceptional demand

throughout thing The second happen be dozens will in year. launching Markets next the And year through our is of we'll HERO Global countries group. that

a well. So thing, X we as see not lot of there but that's Jan opportunity a

I'd give of did they in what's space acquired acquired in say their What's HERO than Now expand THERABREATH, expect had more the but happening us more resets more is XXXX. breath, willing we from is gains happening HERO. was consumer in December demand fully benefit to happen for and distribution when of THERABREATH. far retailers versus And did is are XXXX. shelf because distribution XXXX already when less get thoroughbred We to that we the in is in to comparison and XXXX shelf XXXX, THERABREATH the voting favor space

In the that's new TDPs. big got Bill, Yes, retailers, difference new got We stores. XXXX, for XXXX. we

Now expanding happening. shelf space that and it's footprint all what's about that's and

Yes.

in just margin then by is of that sound trying EPS second, of your terms or on the accelerated have gross XQ of going the Is Got gross does some like it. pulling keep you'll 'XX? profit to and the it business is reinvest SG&A more to to in there in just trying to the of -- -- And Or it Because back some understand will spend kind how promotions? things kind check. a keep you're guidance in SG&A? your benefit on in spend

SG&A. mostly it's Bill, Yes,

is incentive few just these investments and more that. Some of higher of is of but talked we've many quarters about it it the comp, last

Hero a example. is think I good

As to registrations, we countries do rapidly we're we're in now XX forward be product fast able that. going new pretty because XX, to

think we to going us great, investments and all So these in help and they're XXXX beyond. are

at Chris Carey Fargo next comes Securities. Wells question The from

saw if because new ahead? or of quick question. we're something to about, an talking a this a course environment that then you're follow-up The you that you the One you're or has is occurring over lapping understand something because that that promotions laundry was and tracking been decision. the did you're new year? broader Or on just I'm to the responding opportunity trying

that. missed I if apologies So

in isolated And I These happened was earlier, can. that pull said are the payback. QX and back those weren't that 'XX, didn't they is decision besides QX QX so to or QX 'XX, happen last it year. because as the in on we promotions best to

that's So time repeat a good to not we said them.

kind get we'll high-level but given make Okay. XXXX know next sense. I on thoughts. you quarter, of That guidance have

this, I volumes As think about positive.

easing. You gross still behind margin have momentum inflation productivity is

perhaps on you've rebased And kind into there feel that high-level maybe Is taken of about this should anything you view obvious into just investment going business less a kind be thoughts about and just going year? think like year. XXXX. about I of how and that your next the we spending any thinking you momentum

we about Chris, Well, feel business. great the

business. organic drag we got organic You kind from well. the of a posted And when volume for that's the of And about in we then and see expect numbers number, growth just SPD thinking X% X.X% growth, QX. the a And as QX, the consumer gigantic quarter got another we second consecutive growth.

we'll we together. quarter to watermark right, that So now, that's which quarters. margin, X we hit going to 'XX. margin, stringing high as volume box Rick number X points our of or can be the if next short but these see XXX was right quarter in gross for said, Gross have well, hope each start I -- XX.X%, the We're growth basis you're the for in

all as the of year, we're And back it, of try came way hey, all we Last to but started of year one more marketing expansion. expect let's course, get XX%. We about of percentage of to way good gross to expect next XX.X%, this then that things year the with we XX%. is would get and margin a we back we're sales. to not the all the So saying, year,

now. us behind that's So

coming I pretty our in broad-based. said one thing product of another XXXX, So best was it's have new we pipelines and

feel -- great lot things So about. of there's we got a we really

we're the And of very confident business. strength in so the

Deutsche from Bank. comes Steve Powers The next from question

I is Great. -- two on fourth just quarter actually. -- A the question first guess, questions guidance

even based done do my it kind you are the to of numbers quarter fourth X The like to you've feels to in the what $X.XX, one, up months. need be on first maybe $X.XX $X.XX but one, first in

points of you XX if math? Just know the talk productivity price And inflation see bridge if between don't I as were Rick, kind of hundred expansion. able about the points. kind that preview a I'm margin, of and balance and to wanted margin of missing to basis about it basis gross just volume that gross in you're in something we couple then that, implies think how

No to Steve, the would repeat if Yes. be first but you the break helpful one, on problem it up. it could one, second

Sorry.

I in expansion gross of points think it's fourth margin implied XXX quarter. about basis the

between you that's of lingering of how out benefits and productivity Just kind think shake versus volume the by the going to price inflation. offset

Yes. Got it.

of a we creep. looked Okay. repurchased XXXX first big step at didn't We one Well, know the I is basis XXXX. we've you do for may to if offset EPS, take share -- that ahead get we've on typically shares a We that this annual -- year. back, in on

and the EPS for get you most difference probably that QX. on to will So way rounding of that the your

on volume the comes kind HERO of itself, But mix to gross thing margin piece questions, into and gets bit because gross and second go component, the acquisition up your portfolio. price down of to the component more bridge of have little I course, the would are piece. price the say, was volume the QX, in of used The bridge margin that price we which by mix going mix the a blended

productivity we a And a from of manufacturing then, are in would bit probably inflation because those just say costs lower and bit on I tailwind go timing So course, it's a price/volume backwards choppy. QX, mix, year-over-year. and projects big little little

X pieces So X are -- margin pieces the the those of the bridge. main gross to kind of

philosophical this just this is -- -- I Okay. questions, perfect. is [indiscernible] guess That's more question. I And if more could

in about be think earnings looking and that the grown table. play And 'XX million. 'XX, in expectation the as obviously. thereabouts $X.XX was $XXX evergreen that we'd of So you had didn't at It if on was we everything that, coming out 'XX, if into we original go back XXXX. But to way,

are 'XX we philosophically forward, guys trying over kind from have is, So of approaching Evergreen Or future we're look the we to running back claw guess that $X.XX of off question I sort the you and time? written here? as

public was that, Well, was hit us. and things then vitamins Steve, hey, XXXX X-year -- going is it I and X In say, the everybody company was FLAWLESS. question -- event. any that post were last of It COVID is like to with XXXX, and there mean -- a COVID a year WATERPIK

So there. the in and FLAWLESS of business grow and gets WATERPIK, rebaseline. then we vitamins then kind to XXXX, from

simplest the that. got year. were in that's WATERPIK So stabilized. Those affected I Pardon about eyes have but open declining, our XXXX. that next back me, business path about that it. has Vitamin stabilize to think isolated us certainly think businesses way incidents still we We've X Vitamins has is to stabilized. a

question Mohsenian Stanley. next from Morgan comes The from Dara

you can update bit So more a on business. give VITAFUSION us an little the of

your you your return fact, space can regain some business mentioned perhaps sales. shelf in on We plans going obviously in losses. just distribution You you at to understand the plans can, point? that general, the can XXXX based weak scanner the that that see on snap in growth data help in with maybe for that can us have back Do business and XXXX. retail visibility forward And

Yes. in kind weren't problem. Well, to supply simple it's XXXX. a We of able

launches, got shelf retailers by space, interest taking new product a we little losing et punished So in XXXX, cetera. in

shelf consumers. space, to consequently, so you lose you're And lose going

visibility the game resets do whole to so which a And in we lot in of win have XXXX, is now that. the now

everybody more back more now. is We'll space we the talk But January. shelf have win XXXX. in We in really to right to have some fight

Some with good vitamins. respect news to

year. have We this gummy past extremely vitamin there well and #X doing Amazon, are we the on been

us firm think we going just on to Steve, get bigger tackling, So that's footing. do business focus forward for that be on going and execution a But it's well. blocking as to

to pop the the all awareness meanwhile, big marketing that drive those will investing back. And to displays, do packaging and a way on at can to shelf tactical things you in build new we're momentum as

think specifically, environment. Are also, the promotional that? the you general, consumer Okay. positioned on And of that you seeing? seeing issue Great. in Obviously, maybe for give just but And actually sense down. can then just environment laundry you us a then you touched trade you on promotional you're the you're touched well

Look, my category. of opening or trade in down, remarks, Yes. as class I mentioned the the litter a liter trade in

a orange have box black box and premium, We is the black box box is and value. an orange

are black it And within staying Orange trading consumers so and that shows box to franchise in box, from shares. our the

shares XX% almost So are litter. our like in

quarter. respect mean, Your the has I we've let trade laundry down been of -- And -- And I has other quarter, category, after -- extra a question liquid XXXX me was since comment again, as laundry grow. with the the quarter guess, times. well. on more broadly past laundry doing beginning value that, of but It's is see laundry with middle started deep you the a sign to this grew detergent.

our environment. once portfolio again, a for think positioned economic So was well difficult

people Of going to in pockets course, have their unemployment shopping, We be when that as they jobs. think long -- are they money discerning it's as low, going to to but people stays go have shop.

you So to I think in around the value on it to is if round you QX. at QX liquid in like was XX.X% QX, look the was environment, It's promotional to sold numbers, and it win. deal some going When liquidity And XX%. comes laundry, XX%. best numbers, give just

creeping So up liquid been has during XXXX. laundry

And be we it so it's where to expect around pre-COVID.

unit of way true kind kind of back. dose. for the Same is it's So all

QX, If you in QX, QX. sequentially on unit sold XX% QX, XX% look dose at deal in

Litter is different a Now story.

the it's back pulled of X largely because of the consequently that competitors had promotion. has has I and think difficulties

QX So million $XX.X for in in litter in the trend XX.X% XX% QX, and a is QX. QX, QX like point QX,

QX. for that sold definitely sequentially environment, I deal. a gives you categories going vitamins it sense I'd QX you to unit are say XXX what's is for competitors that spending XX% in promotional of letter some So the dose those it up go I but X lounge in way, to that grab can't like points does kind There think But volume. basis the sense trend. on on money of Steve. make lot a are a give vitamins, from

Lauren from The from Barclays. Lieberman next question comes

sort so you've impressive Hey, think and focused cream question some the But with categories we've on in stuff. seen a talked expanding HERO. eye acne-related of talks about you past, retinal I HERO. and into about being about and I have bombs

where So you on kind And there. start perspective just of there overall. just stand and curious Beauty

Well, it's big patches related This broad. and objective launching to is and products dozens in look, acne and a countries on is The Yes. in our acne really category. opportunity [indiscernible] with win pretty really, also plan #X acne HERO. to XXXX in of that's on in

So the patch to we greater we think too runway. to there's patch our still of another much get sure outside so there awareness And the which much still is form needs be of want reason focus category. why make we don't

Now HERO is But with are future. and that is on brand. to It in term, the And that ages. to a path focus the resonates all have the right fabulous go acne. be categories adjacent We permission could our of near yes, do in consumers to the definitely

should mid-October, Okay. HERO, the it Great. to like guess, it sticking with looks in and And point in moving growth math it fourth just organic, with quarter. organic then into maybe is but just I sales my add wrong,

that So about I that Frankly, deceleration? kind modeling just is then seeing something sort decelerating of would that ask implies of wanted right of for it thinking the roughly of there to just for Or make conservatism? that what support this. was is And everything about else magnitude sequentially? sort that order you're sure

there remember QX for math year sell-in to Lauren, I it's contribution distribution HERO. to not HERO. lead in I retail to was last new organic our X X a points would Rick. does from of say

doesn't it comp give a much you from just calculating. that that perspective, So you're

think consumption start. I is still QX. think to off October And strong overall, really in great a we was

in think mentioned was I of highest history months the our it of Matt X the ever company. shipment

choices right I and is think expecting. that about nuance So made the some some good for of what promotions, discontinue And our they momentum that's kind feel really now. we we've to weren't folks

Laurie, Do to year. just such all in right evidenced on you want respect narrative. the year-over-year total October. demand a on what to in Do confidence year depends to with this as But said, comps be Yes. perspective. QX. want products at where sequential a have And versus we People look sit strong last for you we your was the to and at by and look depends it QX now the

So we've QX. yes, good for think we got number a

the And I palms of certainly for but our to our is people & we're Dwight only try is We And in have shareholders. don't about not think always conservative, One confident but sure understanding us understand in really sure view. shareholders create and sometimes suit call, accuse take that thing and but to up future. make for Church anybody we not that to we're And the short-term being long thinking. our long-term QX listens analysts, for

question next The comes Lizzul America. from Anna from of Bank

wanted ask spend. to and investment on higher marketing I the

could leverage the investment some certain and share a a in side. some of think benefit you in I on us were market litter categories expecting provide see like from potentially would competitor's disruption maybe that

talk in you spend where investing could where you terms your you of among wondering about the need marketing most think I categories? So and are more was you if support

Yes.

to is and lots we launched But sales nonworking new from of We just some be rates It products laundry just that may invest we some continue But like to for is that also comes sheets well conversion sampling had for as do And want the that going always we supporting vitamins, looking Over the can not There's a litter for laundry we the some that is another that fire had feed things can true of We've product But sheets. would referring be You to after to can THERABREATH. that that prepare businesses sampling us. think we're will in marketing. to in remarkable at. get just avenue we we're opportunities strong help, for when in we Remember, QX. now. of it generally, XXXX. -- line can we've clinical -- help QX litter, X to QX businesses a that there's be so got in of advertising, well. particular be for going of R&D, for to start trials there's But example. you in as that on go whole need after. then list so lot to expected we're the earlier are than right media

in just we'll QX. on it So pour

The from next question comes JPMorgan. from Andrea Teixeira

take to I on wanted quarter. back We'll X% fourth to for swing the another go organic the guide that one.

said volume the higher You would fourth the XX-XX in even now quarter. be rig

bigger with imply the I some it would realization higher. the much pricing that understand that you that of a that promo does nonprofitable in you obviously, So of step-down imply pricing. And discontinuing had had, really

take? also also, was So Because then your at think to frames then and you see into XXXX? related X that And to going those to to How implied guide? quarters linger how the as is that, do trying long it's reducing to long another those in think starting going what seems is lap do you trade. it I you're related this terms if in for pricing? And promos to of

Okay. Andrea.

all, would QX I of in prepared or better I my be So thought guess, first we on X% volume. comments, said

and discrete So repeat We of half. is That's the promotional it's XXXX. that like not better. part all half. don't QX, the QX, I In that talked we X% in But of than QX. pullback in into promotions better not think discontinuing story. simple about. because at And chose some Those of to are was promotions it we some think or continues

we as like we've step to to value. above. you between the that implies, right? retailers somewhere Is have down. now bottom create we're innovation. is probably that the in end And of create XX% other -- with work down well growth moving the It's the always And sense things feel a is the your because it's the you not obviously, now one you told category rather you that course, if consumers day, risk general what in your at trade want then growth other strategically, like it's been if have which any right, starting then midyear to we'd to like have to in of seeing to the it, of portfolio of for want X consumer us, you the in and to back

to some in both across, to sense ways, and in I to value that want have the great. leader category. you it's it's of stop if back you wondering laundry categories go of go the can on going otherwise kind because and also like the So lower But total those you that movement was

lapped comment would those resets. have you that at other as is that which lot some can X I you point, situation the next series the more and as spring on give you that year. on a can for that this that specific So vitamins little of impact one, shelf back you for bit would retailers thought well a into if vitamin And comment

Okay.

of parts. we take full a going start talk back about with second to recently just the I what's do we the in that X. would to that or talked we On position I'll is XX one. vitamins, And So quarter over get that And into It's through months last kind take X us to tactics to all it. would those to. want shelf enable going the

time. long So short but it's been been only I we've know of it talking a for that period like feels about relatively a time,

trade on down. question second Your

been time, really the well. have does I of think company Matt clear and period over really a I long

Our of our well It even better. category are good of the our in mid-tier does do our or in. you premium HERO brands most in portfolio value course, And what times. doing brand THERABREATH But times astonishingly. you're And brands, premium. what like would really bad depends and call

of have you. strong is what Yes, quarter general, of Just a private in some I in That's consumption fantastic. categories, couple rise for October. for but we and the would do tell label

choice trade every about can liquid thing I've at that in just in & look too, you sort here, mind, and year The good Andrea, back that gives HAMMER grown has it been laundry, you And if having have about portfolio and at great keep feel bad of a ARM down. share to in times. that this consumers is

-- simply laundry. have down, But it That's not it's you they stick downturn. trade people So they & yes, gets what and happens true for is with HAMMER the ARM it. when accelerated brand discover economic an

consumer category. box. Now people in between when the the if And certainly, great orange keeping black over will go the to up box you trade to back black litter, trade economy recovers, down box and

just starting because to as forward everybody one on move little we time. And for tight get comment we're a

and Let's question. to just question one it keep one to follow-up maybe try

comes Raymond Tong James. The next from Olivia question from

Great.

that? your there's QX your if talk what and incremental can XX%, a about QX. Matthew, remember What's is particularly you if versus change Because driving around expectations? the flexibility in then [indiscernible] Firstly, in prior I just big QX certain correctly, and categories

have make towards supply. support, We we wanted it laundry fast, was on the MPD had like We did our thought always was even to so weighted sold be more out marketing that we because going of QX -- sure QX. into to shift sheets, out some marketing QX, when turned we of the largely

we So some of into that shifted QX.

laundry, of back your then price can but from benefiting but about you're And some product, you're Got promo, Because also sounds down. portfolio? market the to sheet, you talk first which a laundry cutting on like is we're then it premium it. obviously with trade the just shape

opening that are with you versus on do mid-tier this logic new how midterm of price And portfolio XTRA? thinking longer embark then think term? you positioning So as category? about premium in How of your sort just the about the point versus the also next you

Well, if detergent, value there's and extreme there's value the value. at you look

in have a you're the at end strategy that is where value, area And and even a extreme in underrepresented has extra maybe pods share. an is only share been we're XX% And a is right, & long we have value. of laundry, when, end high time. the for mid-tier. low ARM of we liquid So of a pods fact, the HAMMER X%

it's sheet No Now that pods since and sustainable. more more dose, so is plastic is an jugs. but advantage sheets has in unit

attractive want today the And dose. some greater don't don't be well. anybody a it's comes the So to we pods. as think cannibalize because plastic pouches. Yes, who's share But ARM us could we'll & using to pods unit sheets in anymore, people do gain going who that, have we think This HAMMER to drugs we even migrate to to carton. do in be it big help that's going carrying

portfolio. a sheets So to we the adding by lot there's of positives think

at question from Grom comes Peter The next UBS.

So I wanted to ask specifically about gross margins.

year said all back You this that question, get made that back mentioned that saw target. and response to But to wouldn't you I you opportunity XX.X% next your a of lot Chris' you it year. to kind of you get in of think this kind progress this also

less given unpack year the you So that, momentum then that can And mentioned you're why on just or inflation building Can a not you of were the be ahead? with? case that of Rick, looking deploying heading you're than a for maybe reasons strategy into maybe kind you exiting maybe just hedging the your similar give on us last the hedged help might and so us or whether kind previously. the year, you comment outlook year

is a This for Yes. lot our XXXX. guidance with to do forward-looking

We get would gross I we're into expansion. we'll think January, in details just tell We So have margin there's because going gross on tailwinds those you, margin do February. to all productivity first like Inflation, for normal not we the time years. still higher anywhere but been it's next think a what near few in past these outpace inflation. can than long time, year, think

kind that's what you heartbeat. of tell So I a would in

personal higher other have growing THERABREATH. better, really, we some like because be look HERO and ahead, we margin should care is, nuance when The our faster pre-COVID products

Conference to going fully to Bank conference well. going as and we like Barclays X to So X that it's be recognize I there. said, years get But in to the Deutsche well, be, it's as

to going step a take every we're so good year. And and each

from Modi Next Nik Markets. RBC Capital from comes question

what the assets follow-up just evolve. seeing to that question Matt, Are potential you continues the you're And situation. can talk the just might you out in have promotional look interesting? M&A environment on seeing situation brands about then as a there, of kind I any

sheet they chest. do that Nick, seems. going bidding which for so on well. we've be want Hero always potential you few bit last years, be the of to grow. at to acquired building then, got rates quite -- we obviously may since Okay. We or one always Yes. interest Lot And But yes, of a process cash a able the are right hunt. it of up, rates, X in we've term acquisitions was war I other would we're passed affected they hot. look And now, the high that by a any looked acquisitions brands October We on auction XX. will if to that a at we're of on. got obviously, But processes. say long balance And we're a strong interest you but affect the as moderate buy do a these all

what's always active a something long take there's when and But view available. to got been you to you're buy, So assets. looking at we've looking at pretty at

Nick, a question, on promo? second had You

more it's unprofitable called, mean, growth you focused get programs I Yes. when kind of management usually usually, part growth a management of a revenue revenue initiative, these see initiative.

heard guys much growth you I too about the years, revenue haven't Over talk management.

choices effort that there what's on the So fourth that I'm to that -- a is area, more for really concerted focus just quarter? of around what's just curious, in helpful. driving and that's really some would Any be these perspective

timely a question, that's Nick. No, Yes.

business gate international of Our management. on was really the revenue first out growth

and international of those that businesses the net. levers have all subsidiaries, our link linked it's between subsidiaries more tactics the also now And the up And but more U.S. all adopt those and revenue. X so have we improving those on, reorganized X discussed have recently, gross X been can subsidiaries. practices our U.S. into international we so And that in all regularly we business

in concept to hold whole management taking of that the promotions. about making is yes, unprofitable growth So contributes and decisions revenue company, the

question next The English from comes from Jason Goldman Sachs.

quick In you to surprising expect question, next that you was of Mr. year be I Param's So to response was above hear to average. a couple inflation questions. surprised say

I X that. So related guess to questions

what's your environment in domestic market? categories First, growth positive you expect the price see and next key from of in it? And second, pricing of expect context that, driving do to sort in you you year? Would what

true cost to of around be COGS went the than XXXX would inflation. of some what's And in I it comment years driving is past. more than those COVID -- oil-based for of little pricing during their other last normally years, type is manufacturers was Thanks, in as to But role we've what on can in go then years resin-based the a extent many can good some companies, that it's been with In And lower inflation think say a there's news Jason. cover not normal other it the us going me don't for little I'll COGS And will time, is belief to of now. Bram time year, X% the would. bit I Rick. the had what the productivity is a be X% other what's long My during play XXXX, going of that our way. been commodities. in that lot apparent a that that's through then XXXX these And commodities XXXX. for headwinds. categories XXXX, X%. than 'XX It's headwinds. case Yes. a this that right got other COVID. sure, probably That's major to that and for few And The offset first actually and environment, and will are the in productivity into it but is when bit because wasn't it we higher

some in categories. deflation so And some commodity why that's there's

perspective. our that's So short kind from the of answer

rolled We have one out. just price we increase that

on us bacon quarter We that's October, out roll price soda a cost in talk and XX%. we You to baking soda did and to last plans don't going about out have in And to take further retail. those heard XX% price up ash take inputs being be and soda increase really.

this a for helpful. threat website megawatt like It like pretty Okay. you. new it the And speaking sounds competitive undercutting That's a coming product. in, commoditized you of And I'm on commodities, looks product. have

First on it. talking about

it's assuming innings. new, assuming early I'm So I'm it's still

to And you was it? was how plan this? that it context up How with How drove can to forward? So it else big if XX%, quarter? it's is risk? big. you before how headwind the Obviously, it down deal is this give assess us big and Like going some do X% this big everything

Yes.

years, containers. for imports that low-priced to protected from faced has MEGALAC difficult it little even how were get pre-COVID. of shipping We a So because was

more during was market U.S. bit the really and MEGALAC so protected, a years. little so And did those few well

is competitors profit So business, a we've very constraints This and low in, is X came low-priced lost product lifted, once share. this back were line. there, were shipping competitors

so how restructure at we hard business. looking to that are And

would not so you, volatile, today, minimal. the tell but yes, impact a just And were I talk but down profit about lot on is is to revenue

Jon Andersen Blair. from next from William The question comes

too better you you Just that times in best... of It you be or But have shot. couple detail. comment of the a a one. mentioned early It's one may to for

can you up. you broke us, hear if John,

you've the little towards current characterize of had? new the premium. than it 'XX more better best a bit of will tilted the for kind that value you macro, product that comments innovation Given given lineups And one Matt's or if can be just kind it's of

unveil Well, we're Yes. is we it's look, question, I'm -- of the of going November those all February Xst year. and January a to week week next new our when it logical but outlook products first for give in the

stay on it's tuned So just that best to one, John.

I Can Great. in? squeeze one more

one. Yes, sure. whiffed We didn't first really on the -- you

second So one. with a yes, go

we'll again. Yes, try

that little versus to what really give where you plan bit year-to-date? And expectations look as forward your importantly, more your a could WATERPIK, is XXXX Just around you things. more detail are us business going

to home, business in was at The lot a sold for water try pretty WATERPIK. the whole get during to have this to COVID a was and because look, staying it reset in a got level people year plan, close struggling sales. year of idea comes has flush, to XXXX been flossers 'XX. when some Well,

those of the when And about the we comes as some So been that see to our premier maintaining going have we strategy as struggle February. then WATERPIK that's talk which there's which January, label, equity first for business innovation it's -- week we in is It But of new always end Cadillac at coming that the more as we well that in thing, of brand in we'll more to XXXX. But flosser a the forward. knockoffs and been flossers. WATERPIK, that is the the it the is have decades. more which innovation And significant for is has where -- 'XX. around but is deal not private -- is with and well water

from Escalante Javier from ISI. comes Evercore question next The

volumes. to has question My do with

if underlying an of you growth a going all-channel you X% terms you versus us can something and also, anniversary that sense how in basis around And comment If in QX? volumes growth comp was is your the what there category stand of do to give in that? can on and of is vis-a-vis

Yes.

one even that things first did The the Warren. similar X There's some with One is we impacting in kind have QX. what is I HERO comp of is for said are to big.

So higher comp. that a was

to Matt this the got The had activities laundry promotions. alluded kind year. down some is in what second pared management growth that and QX thing was laundry promotions We revenue discrete of

things. X the are those So

really in look categories. categories tell -- was consumption Yes. But October our -- with see volumes the volume. be to you I in that I and in saw -- if for what can't But in that the QX. in that help driven X% that continues you or growth seeing of And we QX as XX of the by our far to what was XX remember, half XX is categories, better growth you at we news as XX sustain growth our can had good October. of QX and we're We -- XX is our

it's So goes the beat -- on.

a in or of of frequency. a have sense has pullback purchase don't you been actual the there whether pricing, usage amount But given

units. in migrate and And have said, we continue you your suggest higher that to expect When we consumers product to have year-over-year, you like seeing shipping growth, are we're No. more would volume cases -- I that QX. that more

Citi. from Filippo Falorni question The from last comes

quick a back. Keep

expense this a XX%. the normal to of you've Should a for Or done we to in closer percent just marketing as guys? XX%. past, So the a quick clearly on consider also new you you question returned sales.

there's if a normal level wondering new just So investment. of

is XX% and a 'XX XX% would in we of going then go back XX% where 'XX grow was XX%. get that level to that's at step spend to 'XX that we're brands. in from XX.X% and And and to, we think said already sustain in be to it good our and wanted We've to we thought now stair a

to back There the further are comments. over call Mr. no turn questions. I closing Farrel will for

you in for end with us looking of for outlook early January talking forward our great to 'XX. Hurray. XXXX Okay. of QX, or February joining momentum to guys the going lot had really and Thanks at into QX We today. and a a

today. for joining us thanks So

this gentlemen, your your participating, lines. and Ladies for concludes call disconnect please thank today. We you conference we that and you for ask