Church & Dwight Company, Inc. · NYSE:CHD
Church & Dwight — Investor Day (January 2022)
137 slides from Church & Dwight's investor day presentation, Jan 28, 2022
Slide 1: Church & Dwight's Analyst Day 2022
CHURCH & DWIGHT’S ANALYST DAY 2022
Slide 2: Forward-looking statements
This presentation contains forward-looking statements, including, among others, statements relating to net sales and eamings growth; the impact of the COVID-19 pandemic and the Company's response: gross margin changes; trade, marketing. and SG&A spending: sufficiency of cash flows from operations; e
Slide 3: Who from management is with us today
©) WHO FROM MANAGEMENT IS WITH US TODAY? Matt Farrell Chairman and Chief Executive Officer Brian Buchert Strategy and M&A Barry Bruno Chief Marketing Officer Patrick de Maynadier General Counsel and Secretary Rick Dierker Chief Financial Officer Rene Hemsey Global Human Resources Carlos Linares Glob
Slide 4: 2021 was another solid year
2021 was another SOlid year. We have CONTIAENCE in our future. « & YY @ Mm Steady U.S. Sustainable high Consistent Digitally Evergreen Strong growth International innovation savvy model is 2022 ahead growth rate healthy outlook
Slide 5: Agenda
Agenda 01 02 03 04 0S 06 07 08 09 Who We Are U.S. Consumer Business Consistent Innovation Sustainability International Story Animal Productivity Story Supply Chain Resiliency How We Run the Company Financials
Slide 6: Matt Farrell, Chairman and CEO
01 Matt Farrell, Chairman and Chief Executive Officer
Slide 7: Deliver outstanding returns to our shareholders
DELIVER OUTSTANDING RETURNS TO OUR SHAREHOLDERS ISYEAR: | 10YEAR: | SYEAR: | 3 YEAR: 17.9% 20.0% | 17.4%
Slide 8: We have an Evergreen business model
WE HAVE AN EVERGREEN BUSINESS MODEL 3% ORGANIC SALES GROWTH 8% EPS GROWTH
Slide 9: Over ten years of solid organic sales growth
OVER TEN YEARS OF SOLID ORGANIC SALES GROWTH 4.3% organic sales average Evergreen 4.3% Model: 2011) «2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Slide 10: Consistent strong adjusted EPS growth
CONSISTENT STRONG ADJUSTED EPS GROWTH ] 0. 7% adjusted EPS growth average Evergreen Model: 2011 2012. 2013) 2014. 2015) 2016)=— 2017-2018 )3=2019 = 2020S 2021 ©
Slide 11: Organic sales sources
ORGANIC SALES — SOURCES 2% United States 3% 4 6% International @ | 5% Specialty Products Wes © n
Slide 12: Power Brands
POWER BRANDS
Slide 13: More than 80% of sales and profits from power brands
more than 807% of sales & profits are represented by these 14 POWER BRANDS
Slide 14: Our portfolio is balanced and diversified
OUR PORTFOLIO IS BALANCED & DIVERSIFIED A well-balanced portfolio of household and personal care products. 7 _ Specialty Products: 6%
Slide 15: Diversified product portfolio
DIVERSIFIED PRODUCT PORTFOLIO Our Unique Product Portfolio Has Both Value and Premium Products Premium: 60%
Slide 16: Long international runway
LONG INTERNATIONAL RUNWAY U.S. Consumer 76% International Consumer 18% Specialty Products. eS
Slide 17: Our advantage: nimble organizational structure
OUR ADVANTAGE: NIMBLE ORGANIZATIONAL STRUCTURE ~- ™ path * o ae es | 4 » quick decision easy ability to adapt making communication
Slide 18: 2022 headwinds
2022 HEADWINDS Inflation *« Higher commodity costs o resin o surfactants * Broad based inflation across all materials * High transportation costs Supply Chain Shortages * Labor * Material *« Higher co-packer costs
Slide 19: Prices raised on ~80% of the portfolio
As of February, we will have raised prices on ~80% of the portfolio
Slide 20: Long history of growth through acquisitions
LONG HISTORY OF GROWTH THROUGH ACQUISITIONS Net Sales (Billions) $5 2 005 1010 2021 TROJAN spinbrush pas / ‘e a“ Reggresn — Cipteon, Topple Viviscal = POWs ~=ZICAM. TferaBrent [Ribee ike ' oR Bie, Amisol Me FelinePine Nair waterpik o-;
Slide 21: Acquired power brands since 2001
ACQUIRED 13 OF OUR 14 POWER BRANDS SINCE 2001 ACQUIRED 2001 ACQUIRED 2001 ACQUIRED 2001 ACQUIRED 2001 ACQUIRED 2005 ACQUIRED 2006 ACQUIRED 2008 TROJAN [Pe Pnse pon Orgel, SY #1 CONDOM #1 EXTREME #2 PREGNANCY #1 DEPILATORY #2 BATTERY #1 LAUNDRY #1 ORAL CARE VALUE LAUNDRY TEST KIT POWERED ADDITIVE PAI
Slide 22: We continue to grow online
WE CONTINUE TO GROW ONLINE PERCENTAGE OF NET SALES 15% 13% 5% 2 1% = — 2015 2016 = 2017,-'-«-2018=S 2019S 2020S 2021
Slide 23: Low exposure to private label
LOW EXPOSURE TO PRIVATE LABEL Weighted Average Private Label Share of our Categories Private Label Consistently ~12%
Slide 24: Private label shares
PRIVATE LABEL SHARES Only 5 of our | ¥ categories have private label exposure PREGNANCY TEST KITS BAKING SODA GUMMY VITAMINS SO% 30% 20% 40% 25% : 1a q 20% 20% — 4 3 o% oy YF Pes) ? SDI PO DP ear f . <i 8 So Bg GF CLUMPING CAT LITTER 24
Slide 25: U.S. Consumer Business
02 U.S. Consumer Business Barry A. Bruno, Chief Marketing Officer
Slide 26: U.S. consumer business: our future is bright
U.S. CONSUMER BUSINESS: OUR FUTURE IS BRIGHT We are leaders Emerging Acquisitions in growing trends are have room categories our friend to run a |
Slide 27: Leaders in healthy, growing categories
@ WE'RE LEADERS IN HEALTHY, GROWING CATEGORIES CLUMPING LITTER 2017 2018 2019 Ey 2021 | POWER FLOSSING a ORY SHAMPOO TOOTHACHE GUMMY VMS TOOTHPASTE GE BAKING soDA BATTERY TOOTHBRUSH LAUNDRY (Hair GROWTH | Esa PREGNANCY TEST KITS STAIN FIGHTERS I DEPILATORIES «EE Wow en's ELECTRIC GROOMING GER COLD S
Slide 28: Deeper dive into 2021 consumption by category
A DEEPER DIVE INTO 2021 CONSUMPTION BY CATEGORY GUMMY VMS: DRY SHAMPOO POWER FLOSSING PREGNANCY TEST KITS BATTERY TOOTHBRUSH DEPILATORIES —_ = ‘STAIN FIGHTERS at ) (CLUMPING LITTER ALCOHOL FREE MW CONDOMS TOOTHPASTE LAUNDRY TOOTHACHE HAIR GROWTH BAKING SODA WOMEN'S ELECTRIC GROOMING Consumption grew
Slide 29: We know how to grow share
WE KNOW HOW TO GROW SHARE 6 out of 13 power brands maintained or grew share in 2021. Losses were primarily driven by supply shortages. ©
Slide 30: Multiple trends point to continued future growth
@ MULTIPLE TRENDS POINT TO CONTINUED FUTURE GROWTH Prevention is the Best Medicine A Clean Home is a Healthy Home Pricing isa New Muscle Consumer Preferred Gummy Form + New Habits Vitofusiony wGite Pricing Taken on Increased HH 80% of Our Portfolio Penetration a 78e ZICAM » Self-Care is A Return to
Slide 31: Pricing is a new muscle
@ Pricinc IS A NEW MUSCLE Pricing Activity: ¢ As of February, we will have taken price on ~80% of our portfolio ¢ Litter & Laundry mid-year 2021 increases followed by VMS & Personal Care now * 2022 will have the full-year benefit of all price increases ... with more likely ahead Initial Pricing Obse
Slide 32: A clean home is a healthy home
2% A CLEAN HOME IS A HEALTHY HOME mt ARM & HAMMER: +3MM incremental households buying vs 2019 & OxiClean Laundry Additives: +3MM incremental households buying vs 2019 More consumers are spending more time at home and will continue to spend more to keep home clean & healthy...
Slide 33: Prevention is the best medicine
4; 2 | PREVENTION IS THE BEST MEDICINE VITAMINS GUMMY FORM AS % OF VMS SALES VMS CATEGORY CONSUMPTION The gummy form is up VMS category consumption is up +7 pts vs. 2019 and +3 pts vs. 2020 +69% vs. 2019 and 21% vs. 2020 sleep stress mood women's health cognitive +5.7MM Incremental Households Buying
Slide 34: Self-care is essential care
Pf SELF-CARE IS ESSENTIAL CARE Consumer Behavior waterpi k — spinorush aie Rom 8 (iitci =CVViviscal TheraBreath Health & Wellness Goals Source: IR 2021 Sel Core Study: ii Market Addvantage: Total US - MULO: Date through WWEI2.24.21
Slide 35: Return to normalcy
@ 4 RETURN TO NORMALCY CATEGORY GROWTH RATES 2021 vs. 2020 Skin & Nail Dry Hair Growth Depilatories Condoms Devices Shampoo Products +28% +12% +9% +9% +2% O-%
Slide 36: Zicam
© AND, IF THAT'S NOT ENOUGH... ZICAM. Well-positioned when cold & flu return to normal + New Gummy Form MA PROFESSIONAL FORMULA New distribution + Waterpik Dental Hygienist Detailing = continued growth 36
Slide 37: Speaking of TheraBreath, did you know?
SPEAKING OF THERABREATH, DID YOU KNOW? Everyone suffers from morning breath and ~2.5 billion people, or 30% of the world’s population, suffer from some sort of bad breath
Slide 38: Bad breath
BAD BREATH 101 Where does bad breath start? In more than 90% of cases, odor originates in the mouth, throat, and tonsils. What causes bad breath (halitosis)? Bad breath is caused by a group of sulfur producing bacteria which live and multiply within the tongue's surface and in the throat. Best solut
Slide 39: Consumers realize it really works too
CONSUMERS REALIZE IT REALLY WORKS TOO! $ % CYA, Total US 70% 40% 30% 20% 0% = || = |_| = CY 2017 CY 2018 CY 2019 cy 2020 CY 2021 MOUTHWASH ALCOHOL-FREE MOUTHWASH =m THERABREATH
Slide 40: Plenty of room to run on distribution
AND THERE'S PLENTY OF ROOM TO RUN ON DISTRIBUTION ... 2,000 ee — —-— 9.1X 1,600 1,600 1,400 1,200 | a ee ee 4.3x 800 o Fa mm --------------_-. 2.3x bas | = - 1.5x 200 : LJ = Total Points of ] Distribution 1,955.8 932.1 500.0 322.8 216.0 TOP Change vs YA 2.7 47 15.2 -9.2 18.4 Source: Nelsen Syndicate
Slide 41: In summary
IN SUMMARY ... ry) We're leaders in healthy, growing categories Vv) Key trends are our friend iy) Acquisitions have ample room to run and we haven't even talked about our New Product pipeline yet...
Slide 42: Consistent Innovation
03 Consistent Innovation
Slide 43: New VMS consumers seeking gummies with multiple benefits
New VMS Consumers are Seeking Gummies With Multiple Benefits and Added Value
Slide 44: Bi-layer gummies
2 in 1 Bi-Layer Gummies * New gummy technology provides telegraphic benefits: o 2Benefits. 2 Flavors. 2 Colors. ¢ Disrupts Multi segment: o Eases shop-ability o Provides value o Adds incrementality
Slide 45: Hair masks take forever to work
"Hair masks are a treat that make my hair look & feel beautiful, buUT they take forever to work and have to be rinsed off in the shower.”
Slide 46: Leave-in hair mask
Leave-In Hair Mask Nourish hair and seal in moisture. No rinsing required.
Slide 47: Supplements in cough/cold aisle vs vitamin aisle
66% of people think that supplements bought in the cough/cold/flu aisle are different from those in the vitamin aisle. (majority believe they are more effective) ction survey, dune:
Slide 48: Daily immune support
DAILY IMMUNE SUPPORT* * Zicam's first Immune Supplement INEW!, NEW! Gummies * Designed to give your Immune System ZICAM ZICAM ! 2 DAILY IMMUNE SUPPORT the extra support it needs during Cold « & Flu Season 100%, DAILY Vi ZINC+ 00% DAILY VALUE * Day and Night versions ZINC+ VITAMINS C & D VITAMINS C &
Slide 49: Safe solution for baby stains and odors
"For my baby, want a trusted, safe solution that breaks up stains and odors without breaking the bank”
Slide 50: Tough on baby stains
Tough on baby stains Gentle on baby’s skin "Safer Choice" EPA Certified
Slide 51: Consistent innovation continues throughout 2022
CONSISTENT INNOVATION CONTINUES THROUGHOUT 2022 fusion) \itafusion Multié ZICAM ZICAM Beauty ZINC+
Slide 52: Our Path to a More Sustainable Future
04 Our Path to a More Sustainable Future
Slide 53: Climate is more relevant than ever
CLIMATE IS MORE RELEVANT THAN EVER, ESPECIALLY FOR YOUNGER CONSUMERS top priority to ensure 6 7% sustainable planet y) more likely to have been X personally affected Dotopeints shown for Genz Source: Pew Research Center, survey Ape 20-29, 2021: NCP survey, 2027
Slide 54: Expectations are high for corporations
AND EXPECTATIONS ARE HIGH FOR CORPORATIONS TO TAKE A STANCE 88% believe businesses have a responsibility to take care of the planet and its people Source: Wunderman Thompson, Moy 2021
Slide 55: Our recent actions represent our commitment
WE AGREE, AND OUR RECENT ACTIONS REPRESENT OUR COMMITMENT ... Py Mek Partnering 100% of Commitment with the global to Science Arbor Day electricity Based Foundation demand Targets to plant offset by millions of green trees in the energy. Mississippi River Valley.
Slide 56: Formalized long-term corporate climate strategy
AND NOW, WE'VE FORMALIZED OUR LONG-TERM CORPORATE CLIMATE STRATEGY COMMITMENT SCIENCE BASED TARGETS DRIVING AMBITIOUS CORPORATE CLIMATE ACTION Key elements include: ¢ Areduction target of 1.5°C for scope | and 2 emissions and below 2°C for scope 3 targets for 10 years * Reductions will be achieved t
Slide 57: Engaging consumers at brand level
Our consumers have always been proud problem solvers, sO our next step is fo engage them ona Brand level as well.
Slide 58: Arm & Hammer Baking Soda carbon offsets
WHICH WE'RE KICKING-OFF TODAY STARTING WITH OUR ICONIC ARM & HAMMER BAKING SODA BRAND iy) We have measured our footprint And are reducing it to zero through verified carbon offsets* xe om >; iy) To minimize our impact and engage consumers
Slide 59: On this journey today and committed for tomorrow
WE ARE ON THIS JOURNEY ALREADY TODAY — AND COMMITTED TO IT FOR TOMORROW oa * Raise awareness Engage Inspire action
Slide 60: Michael Read, EVP of International & SPD
05 Michael Read, EVP of International & SPD
Slide 61: International organic sales evergreen target
INTERNATIONAL ORGANIC SALES EVERGREEN TARGET: +6% | 6% International @
Slide 62: Historical organic performance vs. evergreen target
HISTORICAL ORGANIC PERFORMANCE VS. EVERGREEN TARGET @4 organic sales: 4. 7% 10.0% 7 8.6% 8.1% 7.8% 7.8% ; ~—— I il i I 201 2018 2019 2021
Slide 63: International net sales
INTERNATIONAL NET SALES
Slide 64: International composition: subsidiaries + GMG
INTERNATIONAL COMPOSITION: SUBSIDIARIES + GMG 2021 INTERNATIONAL NET SALES:
Slide 65: 2021 sources of international organic growth
2021 SOURCES OF INTERNATIONAL ORGANIC GROWTH Subsidiary Markets: +3.0% OOS Global Markets Group: +10.9% © 6s
Slide 66: Portfolio expansion
PORTFOLIO EXPANSION U.S. Power Brand Wider Portfolio across Acquisition Expansion and Subsidiaries & GMG Acceleration leveraging innovation _ waterpi k — y-@ 2. esumoarneucsn Be 6 cmt By FLAWLESS ¢ = ams ze ‘TheraBreath
Slide 67: Resources and capabilities investment
RESOURCES & CAPABILITIES INVESTMENT eCommerce & Direct Local resources in Pricing & Revenue Sell Capability in China Mumbagi, India Growth Management v a%o SSA. . x Local Manufacturing eCommerce & Digital in Asia Marketing Acumen 62% a OIGITAL = Bak ® 2 © 67
Slide 68: Improving adjusted operating margin
IMPROVING ADJUSTED OPERATING MARGIN Committed to +50 bps Expansion Annually 13.2% 12.0% 10.8% 2019 2020 2021
Slide 69: Committed to international organic growth
COMMITTED TO INTERNATIONAL ORGANIC GROWTH Long international runway for existing U.S. power brands ™f~ Leverage newly acquired brands waterpik FraWiess> ‘Vherabreath Global Markets Group fueled by Emerging Markets Ser Strategic investments in Resources & Capabilities ws; Focused on Operating Profit
Slide 70: Animal Productivity Story
06 Animal Productivity Story
Slide 71: SPD organic sales evergreen target
SPD ORGANIC SALES EVERGREEN TARGET: 5% | 5% Specialty Products 8% i o-
Slide 72: Specialty Products Division
SPECIALTY PRODUCTS DIVISION 2021 SPD NET SALES: $336 million +12% vs 2020 Animal Dairy 53% Specialty Chemical 30%
Slide 73: Farm-to-fork solutions to improve productivity
FARM-TO-FORK SOLUTIONS TO HELP IMPROVE PRODUCTIVITY a. oe ™ BIO-CHLOR | MEGAMINE-L —— —_— NUTRITIONAL SUPPLEMENTS 73
Slide 74: Cyclical dairy industry drives SPD organic revenue
THE CYCLICAL DAIRY INDUSTRY DRIVES SPD ORGANIC REVENUE Organic Sales 20% 10% + -10% 2011 2012) -2013) 2014S 2015. 2016)=S 2017's 2018 »=— 2019S 2020. 2021 = 2022E 74
Slide 75: Acquisitions created a more balanced business
ACQUISITIONS CREATED A MORE BALANCED BUSINESS % OF NON-DAIRY SALES 26% Non-dairy sales expected to grow >10% in 2022. <1.0% 2015 2021 2022E 75
Slide 76: Growing international presence
GROWING INTERNATIONAL PRESENCE % INTERNATIONAL SALES 16.0% <5.0% [a — an 2015 2021
Slide 77: Positioned for organic growth
POSITIONED FOR ORGANIC GROWTH Trusted brand 7@ Aligned with consumers’ trend = = . . Multiple species mY HK re a Global growth ) & Oi ial ) 7
Slide 78: Rick Spann, Global Operations
07 Rick Spann, Global Operations
Slide 79: Supply chain resiliency
Supply Chain Resiliency CHD has a short, resilient and tariff proof supply chain serving western and APAC markets with local manufacturing.
Slide 80: Short and tariff-proof
SHORT & TARIFF-PROOF waterpi k Malaysia Vietnam Thailand \ Weer o~.
Slide 81: Increasing our supply base
Slide 82: Diverse manufacturing capabilities
Slide 83: Capacity investments
Slide 84: Maintain operational excellence while creating the supply chain of the future
Slide 85: 08 How We Run the Company
Slide 86: We have five operating principles
Slide 87: Leverage brands
Slide 88: Friend of the environment
Slide 89: Environmental goals
Slide 90: ESG recognition
Slide 91: Leverage people: revenue per employee
Slide 92: Simple compensation structure
Slide 93: All employees focus on gross margin
Slide 94: Key gross margin growth drivers
Slide 95: Leverage assets: capital expenditures as % of sales
Slide 96: Leverage acquisitions: net sales
Slide 97: We have clear acquisition criteria
Slide 98: 14 power brands today, 20 tomorrow
Slide 99: 09 Financials
Slide 100: We have an Evergreen business model
Slide 101: Evergreen model
Slide 102: Q4 2021 highlights
Slide 103: Full year 2021 highlights
Slide 104: Gross margin contraction in 2021
Slide 105: 2022 Outlook
Slide 106: Outlook for 2022
Slide 107: 2022: +4-8% EPS growth
Slide 108: Organic sales – 10 year trend
Slide 109: Focus on gross margin
Slide 110: Gross margin 2022
Slide 111: Marketing spend target
Slide 112: SG&A leverage
Slide 113: Consistent strong adjusted EPS growth
Slide 114: EPS 2022
Slide 115: Best in class FCF conversion
Slide 116: Cash conversion cycle
Slide 117: Strong balance sheet
Slide 118: Significant financial capacity
Slide 119: Prioritized uses of free cash flow
Slide 120: Minimal capital investment
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