Church & Dwight Company, Inc. · NYSE:CHD
Church & Dwight — CAGNY 2024
133 slides from Church & Dwight's conference presentation, Feb 22, 2024
Slide 1: Church & Dwight Co., Inc. CAGNY 2024
CHURCH & DWIGHT CO., INC. CAGNY 2024
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation contains forward-looking statements, including, among others, statements relating to net sales and earnings growth; gross margin changes; trade, marketing, and SG&A spending; sufficiency of cash flows from operations; earnings per share; cost savings programs;
Slide 3: A Look Back: 2023
Strong reported and organic sales 1 growth and gross margin expansion. 2023 ARM & HAMMER LLD, ARM & HAMMER 2 Litter, Batiste, TheraBreath and Hero achieved all time high market shares. A Look Share gains on brands representing 3 close to 60% of our sales. Marketing spending back to historical 4 Back
Slide 4: Historical Total Shareholder Return
Historical Total Shareholder Return 10 YEAR 5 YEAR 3 YEAR 2023 12.6% 8.8% 4.0% 18.7% CAGNY 2024 4
Slide 5: We have confidence in our future
We have confidence in our future. Steady U.S. Sustainable high Consistent Digitally savvy New Evergreen Strong 2024 growth ahead International innovation model is fundamentals growth rate healthy CAGNY 2024 5
Slide 6: Who We Are
Who We Are 6
Slide 7: Church & Dwight's Business Segments
Church & Dwight’s Business Segments 78% 17% 2023 Domestic International Total Company Net Sales $5.9B 5% Specialty Products Division CAGNY 2024 7
Slide 8: Power Brands
FIRST RESPONSE VheraBreath. (2 Y o Ly i=) £ 7) =) [I O = a 7.) POWER BRANDS
Slide 9: 14 Power Brands
more than 85% of sales & profits are represented by these 14 POWER BRANDS 9
Slide 10: Focus from 14 Power Brands to 7 Power Brands
Focus from 14 Power Brands to 7 Power Brands. These seven brands primarily compete in larger categories and have the potential for global expansion. 10
Slide 11: Power Brands
POWER BRANDS 11
Slide 12: 7 Power Brands
more than 70% of sales & profits are represented by these 7 POWER BRANDS 12
Slide 13: We Have a Winning Formula
We Have a Winning Formula A balanced and Low private Strong and Acquisitive diversified label exposure consistent company portfolio innovation 13
Slide 14: A Balanced and Diversified Portfolio
A Balanced and Diversified Portfolio 5% SPD 46% Household 2023 49% Personal Care CAGNY 2024 14
Slide 15: Product Portfolio of Both Value and Premium Products
Product Portfolio of Both Value and Premium Products 37% 2023 63% Value Premium CAGNY 2024 15
Slide 16: Low Private Label Exposure
Low Private Label Exposure Weighted Average Private Label Share of Our Categories 16% 14% 12% Private Label 10% Consistently ~12% 8% 6% 4% 2% 0% 2018 2019 2020 2021 2022 2023 Source: Nielsen Total U.S. AOC CAGNY 2024 16
Slide 17: Category Leading Innovation
Category Leading Innovation 17
Slide 18: Long History of Growth Through Acquisitions
Long History of Growth Through Acquisitions Net Sales $5.9 $ Billions $1.5 2004 2005 2006 2008 2010 2011 2012 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Note: Trojan, Nair and First Response acquired in two parts – 2001 and 2004. CAGNY 2024 18
Slide 19: We Have Clear Acquisition Criteria
We Have Clear Acquisition Criteria Primarily High growth Asset Leverage Deliver #1 or #2 and high margin light C&D sustainable share brands that are manufacturing, competitive brands fast moving logistics and advantage consumables purchasing 19
Slide 20: 7 Power Brands Today and More to Come
7 Power Brands Today and More to Come Net Sales $6.5 $ Billions $6.0 $5.5 7 $5.0 6 $4.5 $4.0 5 $3.5 $3.0 4 3 $2.5 $2.0 2 $1.5 $1.0 $0.5 $0.0 1 184619981999200020012002200320042005200620072008200920102011201220132014201520162017201820192020202120222023 CAGNY 2024 20
Slide 21: Financials
Financials 21
Slide 22: FY 2023 Financial Highlights
FY 2023 Financial Highlights FY OUTLOOK ACTUALS (as of November 3) Net Sales Growth +9.0% +9.2% Domestic: 5.3% Organic Sales +5.0% +5.3% International: 8.5% SPD: -7.9% Gross Margin +210 bps +220 bps Reported EPS +80%, $3.03 +82%, $3.05 Adjusted EPS +6.0%, $3.15 +6.7%, $3.17 Cash from Operations ~$1B
Slide 23: Evolving the Evergreen Model
Evolving the Evergreen Model Prior New Domestic: 2% Domestic: 3% Organic Net Sales +3% International: 6% SPD: 5% +4% International: 8% SPD: 5% Gross Margin +25 bps +25 to +50 bps Marketing FLAT %, Higher $ FLAT %, Higher $ SG&A (25) bps (25) to 0 bps Operating Margin +50 bps +50 bps EPS Growth +8% +
Slide 24: New Evergreen Model Explained
New Evergreen Model Explained Organic • Fast growing categories • Fast growing acquisitions Net Sales • Taking share due to innovation • International growth Gross • Productivity outpacing inflation • Higher margin acquisitions Margin Marketing • Continue to drive efficiency • Higher $’s as the top
Slide 25: Outlook
2023 2024 OUTLOOK 2025
Slide 26: FY 2024 Financial Outlook
FY 2024 Financial Outlook New Evergreen Model 2024 Outlook Reported Sales Growth 4% to 5% Domestic: 3-4% Organic Sales Growth 4% 4% to 5% International: SPD: 4-5% 8% Gross Margin +25 to +50 bps +50 to +75 bps Marketing FLAT %, Higher $ FLAT %, Higher $ Adjusted SG&A (25) to 0 bps LEVERAGE Operating
Slide 27: 2024 Adjusted EPS Growth Breakdown
2024 Adjusted EPS Growth Breakdown (outlook 7-9%) Adjusted EPS Growth (ex-Megalac) 8% to 10% Megalac Impact (1)% Adjusted EPS Growth 7% to 9% Adjusted EPS is a non-GAAP measure. Refer to the Appendix for a reconciliation to the most directly comparable GAAP measures. CAGNY 2024 27
Slide 28: Net Sales Growth: 10 Year History
Net Sales Growth: 10 Year History 12.3% 9.8% 9.2% 8.1% 10 Year Average: 6.0% 4%-5% 5.1% 6.3% 3.2% 3.6% 2.9% 2.9% 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024E CAGNY 2024 28
Slide 29: Organic Sales Growth: 10 Year History
Organic Sales Growth: 10 Year History 10 Year Average: 4.2% 9.6% 4%-5% 5.3% 3.5% 4.3% 4.4% 4.3% 3.6% 3.2% 2.7% Evergreen Target: 1.4% 4.0% 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024E Organic sales is a non-GAAP measure. Refer to the Appendix for a reconciliation to the most directly comp
Slide 30: Volume Trend Continues to Improve
Volume Trend Continues to Improve 8.1% 5.0% 4.4% 3.4% 3.7% 3.1% 1.0% 1.0% 0.9% 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024E -5.1% Outlook as of February 2, 2024 CAGNY 2024 30
Slide 31: 2024 Focus On Gross Margin
2024 Focus On Gross Margin Evergreen Target: +25 to +50 bps 50-75 bps 45.5% ~80 bps remaining to get back to 2019 GM levels 44.1% 2018 2019 2020 2021 2022 2023 2024E Outlook as of February 2, 2024 CAGNY 2024 31
Slide 32: 2024 Marketing Spend Target
2024 Marketing Spend Target 11.7% 11.8% 12.1% 11.1% 10.9% 11.0% 11.0% with 4-5% Net Sales 10.0% Growth represents $35MM YOY increase in marketing investment in 2024 2018 2019 2020 2021 2022 2023 2024E Outlook as of February 2, 2024 CAGNY 2024 32
Slide 33: 2024 Adjusted SG&A
2024 Adjusted SG&A 14.2% 14.1% 14.7% 13.6% 13.0% Return to leverage in line with Evergreen model while making growth investments behind International and Ecommerce 2019 2020 2021 2022 2023 2024E Note: Adjusted SG&A is a non-GAAP measure. Refer to the Appendix for a reconciliation to the most compara
Slide 34: Consistent Strong Adjusted EPS Growth
Consistent Strong Adjusted EPS Growth 7% to 9% Midpoint $3.42 $3.17 $3.02 $2.97 $2.83 $2.47 $2.27 $1.94 $1.77 9.3% 9.6% 17.0% 8.8% 14.6% 6.7% -1.7% 6.7% 2016 2017 2018 2019 2020 2021 2022 2023 2024E Note: Adjusted EPS growth is a non-GAAP measure. Refer to the Appendix for a reconciliation to the mo
Slide 35: "Best In Class" FCF Conversion
“Best In Class” FCF Conversion 10 Year Average: 119% 129% 131% 126% 126% 125% 123% Elevated Capex 116% 112% 103% 97% 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Refer to the Appendix for a reconciliation to the most directly comparable GAAP measures. CAGNY 2024 35
Slide 36: Cash Conversion Cycle: Tight Control Of Working Capital
Cash Conversion Cycle: Tight Control Of Working Capital Drives Cash Conversion Cycle Improvement 52 40 36 34 32 32 27 27 22 22 days 21 19 18 18 14 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 CAGNY 2024 36
Slide 37: Strong Balance Sheet
Strong Balance Sheet Credit Rating: Total Debt/Bank EBITDA A3/BBB+ 2.6x 2.2x 1.9x 1.9x 1.6x 2.1x 1.5x 1.4x 1.8x 1.7x 1.6x 1.4x 1.4x 1.2x 0.7x 0.5x 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024E Note: Total debt/EBITA is a non-GAAP measure. Refer to the Appendix for
Slide 38: Significant Financial Capacity
Significant Financial Capacity (in $millions) Cash & Cash Equivalents $344 Leverage • 2023 TTM Bank EBITDA = Capacity $4,000 Acquisition $1,350M Power: • Example: Acquisition $4.3B EBITDA multiple of 12x Current Debt Outstanding $2,425 As of 12/31/23 CAGNY 2024 38
Slide 39: Prioritized Uses Of Free Cash Flow
Prioritized Uses Of Free Cash Flow 1 TSR-Accretive M&A 2 Capex For Organic Growth & G2G 3 New Product Development 4 Debt Reduction 5 Return Of Cash To Shareholders CAGNY 2024 39
Slide 40: Minimal Capital Investment
Minimal Capital Investment Capital Expenditures as a % of Sales 5.4% 3.8% 3.3% 3.0% 2.8% 2.5% 2.5% 2.3% 2.1% 2.1% 2.0% 1.8% ~2.0% 1.7% 1.4% 1.4% 1.2% $135 $64 $77 $75 $67 $71 $62 $50 $45 $60 $74 $99 $119 $179 $224 $180 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024E
Slide 41: 4% Dividend Increase In 2024
4% Dividend Increase In 2024 $1.13 $1.09 $1.05 $1.01 $0.96 $0.91 123 $0.87 $0.76 consecutive years of dividends +119% +7.0% +14.5% +4.6% +5.5% +5.2% +4.0% +4.0% +4.0% +35% 2017 2018 2019 2020 2021 2022 2023 2024 CAGNY 2024 41
Slide 42: U.S. Story
U.S. Story 42
Slide 43: US Domestic Sales Evergreen Target: +3%
US Domestic Sales Evergreen Target: +3% 3% United States 4% 8% International 5% Specialty Products CAGNY 2024 43
Slide 44: Consumer Domestic Organic Sales Performance
Consumer Domestic Organic Sales Performance We Are Leaders 10.7% In Growing Categories We Thrive In 5.7% New Difficult Evergreen Environments 4.3% 4.0% Target: 3.6% 3.0% 3.1% 3.0% 2.0% Acquisitions 1.4% Have Room To 0.9% Run 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Organic sales growth is a
Slide 45: Healthy, Growing Categories: 7 Power Brands
8 Healthy, Growing Categories: 7 Power Brands 2019 2020 2021 2022 2023 Laundry Clumping Litter Stain Fighters VMS Gummy Power Flossing Dry Shampoo Alcohol Free Mouthwash Acne Patch Source: Circana; Total US – MULO; Data through L52 WE12.31.23 CAGNY 2024 45
Slide 46: We Thrive In Difficult Environments
We Thrive In Difficult Environments 37% of Our Portfolio is Value Low Private Label Exposure Weighted Average Private Label Share Of Our Categories 63% Private Label Premium Consistently 16% ~12% 14% 12% 10% 37% Value 8% 6% 4% 2% 0% 2018 2019 2020 2021 2022 2023 Source: L: Circana; Total US – MULO;
Slide 47: TheraBreath & Hero Acquisitions Still Have Lots Of Room To Run
TheraBreath & Hero Acquisitions Still Have Lots Of Room To Run … Total Points of Distribution 2.8x 3.7x 2.6x TDP Change TDP Change -7.8% 3.5% 57.8% -2.3% 204.0% -20.4% vs YA vs YA Source: Circana, Total US – Multi Outlet, WE12.31.2023 CAGNY 2024 47
Slide 48: Household Penetration: Room To Run
Household Penetration: Room To Run … MOUTHWASH ACNE TREATMENT Mouthwash Acne Treatment Category Category 2019 63.1% 1.4% 16.3% 0.2% 2020 65.7% 2.7% 19.3% 0.9% 2021 64.2% 3.2% 20.5% 2.8% 2022 61.8% 4.5% 20.3% 4.4% 2023* 63.4% 7.3% 21.9% 6.4% Source: Numerator Insights; *12ME As pf 2023.11.30, CAGNY 2
Slide 49: Market Shares and Innovation in our Major Categories
Market Shares and Innovation in our Major Categories 49
Slide 50: Fabric Care
Fabric Care 50
Slide 51: A&H Liquid Laundry Category Growth
A&H Liquid Laundry Category Growth $ Consumption Change vs. YAG 2023 4.8% 3.3% Category A&H LLD Source: Circana, Total US – Multi Outlet, CY 2023 WE 12.31.2023 CAGNY 2024 51
Slide 52: A&H Laundry: All Time Share High Achieved In 2023
A&H Laundry: All Time Share High Achieved In 2023 A&H Liquid Laundry Share Of Market 14.4% All-time Share High! 5.0% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Source: Circana Total MULO Liquid Laundry, L52 WE12.31.2023 CAGNY 2024 52
Slide 53: Arm & Hammer Deep Clean
Introducing: Arm & Hammer Our Most Powerful Deep Clean Formula and our First Entry Into the Mid-Tier Laundry Detergent Segment Launching Nationally In Q1 2024 53
Slide 54: Arm & Hammer Laundry Architecture Good/Better/Best
Arm & Hammer Laundry Architecture Good/Better/Best Good Better Best CAGNY 2024 54
Slide 55: Arm & Hammer Deep Clean
Arm & Hammer Deep Clean 55
Slide 56: Arm & Hammer Power Sheets
Introducing: Arm & Hammer The First Mainstream Power Sheets Brand To Launch Laundry Detergent Sheets #2 Detergent Sheet on Amazon 4.5 Average Star Rating Already Biggest Growth Driver In The Sheet Category Launching Nationally In 2024 56
Slide 57: Arm & Hammer Power Sheets
Arm & Hammer Power Sheets 57
Slide 58: Cat Litter
Cat Litter 58
Slide 59: Cat Litter: Category Consumption
Cat Litter: Category Consumption $ Consumption Change vs. YAG 2023 11.7% 11.8% Category Arm & Hammer Source: Circana, Total US – Multi Outlet, CY 2023 WE 12.31.2023 CAGNY 2024 59
Slide 60: A&H Litter: All Time Share High Achieved In 2023
A&H Litter: All Time Share High Achieved In 2023 Clumping Litter Dollar Share 24.8% 2019 - 2023 All-time Share High 23.6% 2019 2020 2021 2022 2023 Source: Circana Total MULO + Pet A&H Clumping Litter Sales, L52 WE12.31.2023 CAGNY 2024 60
Slide 61: Arm & Hammer HardBall
Introducing: We’re Changing The Arm & Hammer Lightweight Litter HardBall Experience Lightweight Perfected: Ultra-compact strong clumps Nearly 60% lighter than our regular clay litter Plant based 4.2 Average Star Rating* Expanding Nationally in 2024 *Amazon.com 61
Slide 62: HardBall: Lightweight Fair Share Is A $100MM Opportunity
HardBall: Lightweight Fair Share Is A $100MM Opportunity 29% 4% A&H Lightweight Share A&H Regular Weight Litter Share Source: Circana: Total US MULO + Pet CY 2023 Ending 12.31.23 CAGNY 2024 62
Slide 63: Dry Shampoo
eo eee,, e e e Dry Shampoo 63
Slide 64: Batiste Drives Dry Shampoo Category Growth
Batiste Drives Dry Shampoo Category Growth $ Consumption Change vs. YAG 2023 15.6% 16.0% Category Batiste Source: Circana, Total US – Multi Outlet, CY 2023 WE 12.31.2023 CAGNY 2024 64
Slide 65: Batiste: All Time Share High Achieved in 2023
Batiste: All Time Share High Achieved in 2023 Dry Shampoo Dollar Share 46.3% 2019 - 2023 All-time Share High 37.2% 2019 2020 2021 2022 2023 Source: Circana Total MULO Dry Shampoo, L52 WE12.31.2023 CAGNY 2024 65
Slide 66: Batiste Sweat & Touch Activated
Introducing: Batiste Our Next Innovation Sweat & Touch In Dry Shampoo Activated A burst of fragrance with every touch or drop of sweat for up to 24 hours of freshness 4.5 Average Star Rating* Launching Nationally In 2024 *Ulta.com 66
Slide 67: Batiste Sweat & Touch Activated
Batiste Sweat & Touch Activated 67
Slide 68: Vitamins
Vitafusion) Vitamins
Slide 69: Vitafusion Update
Vitafusion Update What once made …is now Vitafusion unique… prevalent in • gummy form the VMS • great taste • wide assortment category The number of competitors has grown from 6 to 60 in the gummy VMS category CAGNY 2024 69
Slide 70: The Combination Has Resulted In Share Erosion Over Time
The Combination Has Resulted In Share Erosion Over Time 30% Vitafusion Market Share and Category Sales (Adult Gummy) 25% 23.9% 20% 15% 12.3% 10% 5% 0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2018 2018 2018 2018 2019 2019 2019 2019 2020 2020 2020 2020 2021 2021 2021 20
Slide 71: The Good News: Consumers & Retailers Still Love Vitafusion
The Good News: Consumers & Retailers Still Love Vitafusion Consumers Still Choosing Us More Than Our Brands Still Have Highest HH Gummy Any Other Gummy Brand In Biggest VMS Penetration Retailers Household Penetration - Gummy VMS 10.9% #1 6.3% 6.0% Vitafusion OLLY Nature Made Source: L-Circana, WE12.
Slide 72: Vitafusion 2024
Vitafusion 2024 Base Formula Upgrades New Displays New Advertising Texture & Flavor Enhancements New Packaging New Forms More pop! at shelf. Simpler for consumers to shop. Soft Chews Goal: Stabilize The Business In 2024 To Return To Growth In 2025 CAGNY 2024 72
Slide 73: Mouthwash
TheraBreath. Mouthwash
Slide 74: TheraBreath Drives Mouthwash Category Growth
TheraBreath Drives Mouthwash Category Growth $ Consumption Change vs. YAG 2023 85.6% 12.8% Category TheraBreath Source: Circana, Total US – Multi Outlet, CY 2023 WE 12.31.2023 CAGNY 2024 74
Slide 75: TheraBreath: All Time Share High Achieved In 2023
TheraBreath: All Time Share High Achieved In 2023 Mouthwash Dollar Share 13.3% 2019 - 2023 All-time Share High +45% +59% 2.6% 2019 2020 2021 2022 2023 Source: Circana; Total MULO Total Mouthwash, L52 WE 12.31.2023 CAGNY 2024 75
Slide 76: TheraBreath Deep Clean Alcohol Free
Introducing: TheraBreath Alcohol Free Deep Clean Antiseptic Rinse Antiseptic accounts for 30% of Total Mouth Wash Category Kills 99.9% of Germs No Burn Dentist Formulated Launching Nationally In 2024 76
Slide 77: TheraBreath
TheraBreath 77
Slide 78: Acne Treatment
Hero. Acne Treatment
Slide 79: Hero Drives Acne Category Growth
Hero Drives Acne Category Growth $ Consumption Change vs. YAG 2023 72.9% 20.4% Category Hero Source: Circana, Total US – Multi Outlet, CY 2023 WE 12.31.2023 CAGNY 2024 79
Slide 80: Hero: All Time Share High Achieved In 2023
Hero: All Time Share High Achieved In 2023 Total Acne Dollar Share 18.4% 2019 - 2023 All-time Share High 0.2% 2019 2020 2021 2022 2023 Source: Circana; Total MULO Acne Treatment, L52 WE 12.31.2023 CAGNY 2024 80
Slide 81: Mighty Patch is the #3 Selling Item at a Large Mass Retailer
Mighty Patch is the #3 Selling Item at a Large Mass Retailer #1. #2. #3. #4. CAGNY 2024 81
Slide 82: Hero Innovation Update
Hero Innovation Update Acne Patches Acne Prone Skin Cleansing New in 2023 Upgraded formula & new pack size Launching Q1 2024 CAGNY 2024 82
Slide 83: Great Momentum + Great NPD: We're Betting Big On 2024!
Great Momentum + Great NPD We’re Betting Big On 2024! 83
Slide 84: Digital Acceleration
Digital Acceleration 84
Slide 85: 70% of purchases in the U.S. are influenced by digital channels
70% of purchases in the U.S. are influenced by digital channels. CAGNY 2024 85
Slide 86: 80% of our media is now digital
Digital is a core business driver for Church & Dwight. 80% of our media is now digital. CAGNY 2024 86
Slide 87: eCommerce Continues To Accelerate For Our Brands
eCommerce Continues To Accelerate For Our Brands % of Global Church & Dwight Consumer Net Sales 20% 2% 2016 2017 2018 2019 2020 2021 2022 2023 CAGNY 2024 87
Slide 88: Growing Online Share in 6 of 7 Power Brands
Growing Online Share in 6 of 7 Power Brands CAGNY 2024 88
Slide 89: International & Specialty Products
International & Specialty Products 89
Slide 90: International Story
International Story 90
Slide 91: International Organic Sales Evergreen Target: +8%
International Organic Sales Evergreen Target: +8% 3% United States 4% 8% International 5% Specialty Products CAGNY 2024 91
Slide 92: International Sales By GMG & Subsidiaries
International Sales By GMG & 6 Subsidiaries 37% 27% Canada Global Markets 2023 Group 12% International UK Net Sales 8% Mexico ~$1B 7% 3% 6% Australia Germany France CAGNY 2024 92
Slide 93: Geographic Expansion: International Runway Ahead
Geographic Expansion….International Runway Ahead % of % of U.S. Domestic International Sales Sales Top 10 CPG Company 41% 59% AVG% Church & Dwight 83% 17% CAGNY 2024 93
Slide 94: International Organic Sales Performance
International Organic Sales Performance New Evergreen 9.2% Target: Our Brands Travel 8.6% 8.5% Well 7.8% 7.8% 8.0% 5.0% Investing in GMG Infrastructure 2.8% Accelerating recent acquisitions 2017 2018 2019 2020 2021 2022 2023 Organic sales growth is a non-GAAP measure. Refer to the Appendix for a rec
Slide 95: Brands Consumers Love That Travel The Globe
Brands Consumers Love That Travel The Globe U.S. Brand Expansion International OTC & Acquisition and Leveraging Personal Care Portfolio Acceleration Innovation CAGNY 2024 95
Slide 96: Investing in GMG Infrastructure
Investing in GMG Infrastructure • LATAM • APAC • EA • IME • CHINA CAGNY 2024
Slide 97: Committed To International Organic Growth
Committed To International Organic Growth • Our Brands Travel Well • Investing in GMG Infrastructure • Accelerating recent acquisitions CAGNY 2024 97
Slide 98: Specialty Products Division
Specialty Products Division 98
Slide 99: SPD Organic Sales Evergreen Target: +5%
SPD Organic Sales Evergreen Target: +5% 3% United States 4% 8% International 5% Specialty Products CAGNY 2024 99
Slide 100: Specialty Products Division
Specialty Products Division 55% 12% Animal Megalac 2023 Nutrition SPD Net Sales ~$321MM 33% Specialty Chemicals CAGNY 2024 100
Slide 101: Specialty Products Division Organic Growth (ex-Megalac)
Specialty Products Division Organic Growth (ex-Megalac) 2.5% -7.9% 2023 2023 ex-Megalac CAGNY 2024 101
Slide 102: Animal Productivity: Prebiotics, Probiotics, & Food Processing Safety
Animal Productivity: Prebiotics, Probiotics, & Food Processing Safety NUTRITIONAL SUPPLEMENTS CAGNY 2024 102
Slide 103: Animal Productivity: Growing International Presence
Animal Productivity: Growing International Presence % International Sales 17% +25% Net Sales Growth vs 2022 <6% 2015 2023 CAGNY 2024 103
Slide 104: Positioned For Organic Growth
Positioned For Organic Growth • Trusted brand • Aligned with consumer trends • Diversified to multiple species • Global growth runway CAGNY 2024 104
Slide 105: How We Run The Company
How We Run The Company 105
Slide 106: We Have Five Operating Principles
We Have Five Operating Principles 1 2 3 4 5 Leverage Friend of the Leverage Leverage Leverage Brands Environment People Assets Acquisitions Brands consumers Long history of Highly productive We strive to be Good shareholder love around the being a friend to people in a place asset light returns beco
Slide 107: We Have Five Operating Principles
We Have Five Operating Principles 1 2 3 4 5 Leverage Friend of the Leverage Leverage Leverage Brands Environment People Assets Acquisitions Brands consumers Long history of Highly productive We strive to be Good shareholder love around the being a friend to people in a place asset light returns beco
Slide 108: We Have Five Operating Principles
We Have Five Operating Principles 1 2 3 4 5 Leverage Friend of the Leverage Leverage Leverage Brands Environment People Assets Acquisitions Brands consumers Long history of Highly productive We strive to be Good shareholder love around the being a friend to people in a place asset light returns beco
Slide 109: Since 1888, a Friend of the Environment
Since 1888, a Friend of the Environment CAGNY 2024 109
Slide 110: Church & Dwight's Environmental Heritage
Church & Dwight’s Environmental Heritage 1888 1907 1970s 2017 2018 2021 2023 Company Company Sole sponsor of Partnering 100% of global Commitment Commenced introduces institutes the first Earth Day. with the Arbor electricity to Science projects for pro- use of Day demand offset Based Targets Scienc
Slide 111: Climate Is More Relevant Than Ever, Especially For Younger Consumers
Climate Is More Relevant Than Ever, Especially For Younger Consumers 67% make a sustainable planet their top priority. Datapoints shown for Gen Z Source: Pew Research Center, survey April 20-29, 2021; NCP survey, 2021 111
Slide 112: Our ESG Scores Continue to Improve
Our ESG Scores Continue to Improve 2020 CCC B BB BBB A AA AAA 2021 CCC B BB BBB A AA AAA 2022 CCC B BB BBB A AA AAA 2023 CCC B BB BBB A AA AAA CAGNY 2024 112
Slide 113: We Have Five Operating Principles
We Have Five Operating Principles 1 2 3 4 5 Leverage Friend of the Leverage Leverage Leverage Brands Environment People Assets Acquisitions Brands consumers Long history of Highly productive We strive to be Good shareholder love around the being a friend to people in a place asset light returns beco
Slide 114: Industry Leading Revenue Per Employee
Industry Leading Revenue Per Employee Revenue per Employee $1,020 (in ‘000s) CHD CLOROX PG Kenvue COLGATE KIMBERLY RECKITT NEWELL EDGEWELL Source: Most recent SEC filings CAGNY 2024 114
Slide 115: Simple Compensation Structure
Simple Compensation Structure Net Revenue Bonuses are tied 100% to business results. Strategic Gross Initiatives Margin Management is required to Expansion be heavily invested in company stock. Cash EPS From Operations CAGNY 2024 115
Slide 116: All Employees Focus On Gross Margin
All CHURCH & DWIGHT Employees Focus On Gross Margin 20% Gross margin is of all employees’ annual bonus. CAGNY 2024 116
Slide 117: Key Gross Margin Growth Drivers
Key Gross Margin Growth Drivers Good to Supply Chain Great Cost Optimization Optimization Acquisition New Products Synergies CAGNY 2024 117
Slide 118: We Have Five Operating Principles
We Have Five Operating Principles 1 2 3 4 5 Leverage Friend of the Leverage Leverage Leverage Brands Environment People Assets Acquisitions Brands consumers Long history of Highly productive We strive to be Good shareholder love around the being a friend to people in a place asset light returns beco
Slide 119: Minimal Capital Investment
Minimal Capital Investment Capital Expenditures as a % of Sales 5.4% 3.8% 3.3% 3.0% 2.8% 2.5% 2.5% 2.3% 2.1% 2.1% 2.0% 1.8% ~2.0% 1.7% 1.4% 1.4% 1.2% $135 $64 $77 $75 $67 $71 $62 $50 $45 $60 $74 $99 $119 $179 $224 $180 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024E
Slide 120: We Have Five Operating Principles
We Have Five Operating Principles 1 2 3 4 5 Leverage Friend of the Leverage Leverage Leverage Brands Environment People Assets Acquisitions Brands consumers Long history of Highly productive We strive to be Good shareholder love around the being a friend to people in a place asset light returns beco
Slide 121: Long History of Growth Through Acquisitions
Long History of Growth Through Acquisitions Net Sales $5.9 $ Billions $1.5 2004 2005 2006 2008 2010 2011 2012 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Note: Trojan, Nair and First Response acquired in two parts – 2001 and 2004. CAGNY 2024 121
Slide 122: We Have Clear Acquisition Criteria
We Have Clear Acquisition Criteria Primarily High growth Asset Leverage Deliver #1 or #2 and high margin light C&D sustainable share brands that are manufacturing, competitive brands fast moving logistics and advantage consumables purchasing 122
Slide 123: A Look AHEAD to 2024 – Strong Fundamentals
1 Strong organic growth. A Look AHEAD 2 Meaningful gross margin expansion. to 2024 – 3 Great new product pipeline. Strong 4 Investing in International and E-commerce. Fundamentals 5 Strong cash flow generation to fund future acquisitions. 123
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Slide 125: Reconciliation of Non-GAAP Measures
RECONCILIATION OF NON-GAAP MEASURES CHURCH & DWIGHT CO., INC.’s Reconciliation of Non-GAAP Measures: The following pages provide definitions of the non-GAAP measures used in this presentation and reconciliations of these non- GAAP measures to the most directly comparable GAAP measures. These non-GAA
Slide 126: Reconciliation of Non-GAAP Measures: Organic Sales Growth
RECONCILIATION OF NON-GAAP MEASURES ORGANIC SALES GROWTH The presentation provides information regarding organic sales growth, namely net sales growth excluding the effect of acquisitions, divestitures and foreign exchange rate changes, from year-over-year comparisons. Management believes that the p
Slide 127: Reported & Adjusted Non-GAAP Reconciliations
REPORTED & ADJUSTED NON-GAAP RECONCILIATIONS For the year ending December 31, 2023 2022 2021 2000 2019 Adjusted SG&A Reconciliation SG&A - Reported 15.2% 20.8% 11.7% 12.1% 14.4% Brazil Charge 0.0% 0.0% 0.0% 0.0% -0.2% Flaw less Earnout Adjustment 0.0% 0.0% 1.9% 1.9% -0.2% Flaw less I ntangible Asset
Slide 128: Reconciliation of Non-GAAP Measures: Earnings Per Share
RECONCILIATION OF NON-GAAP MEASURES EARNINGS PER SHARE This presentation discloses reported EPS excluding the following, namely, earnings per share calculated in accordance with GAAP adjusted to exclude significant one-time items that are not indicative of the Company’s period-to-period performance.
Slide 129: Reported & Adjusted Non-GAAP Reconciliations
REPORTED & ADJUSTED NON-GAAP RECONCILIATIONS For the year ending December 31, 2023 2022 2021 2020 2019 2018 2017 2016 Adjusted EPS Reconciliation EPS - Reported $ 3.05 $ 1.68 $ 3.32 $ 3.12 $ 2.44 $ 2.27 $ 2.90 $ 1.75 Pension Settlement Charge $ - $ - $ - $ - $ - $ - $ 0.12 $ - Brazil Charge $ - $ -
Slide 130: Reconciliation of Non-GAAP Measures
RECONCILIATION OF NON-GAAP MEASURES Free Cash Flow: Free cash flow (a non-GAAP measure) is defined as cash from operating activities (a GAAP measure) less capital expenditures (a GAAP measure). Management views free cash flow as an important measure because it is one factor in determining the amount
Slide 131: Reconciliation of Non-GAAP Measures
RECONCILIATION OF NON-GAAP MEASURES TOTAL DEBT TO BANK EBITDA Total Debt to Bank EBITDA is a ratio used in our debt agreements. Bank EBITDA (a non-GAAP measure) is a form of adjusted EBITDA, and represents earnings from Income (a GAAP measure), excluding interest income and interest expense income t
Slide 132: Total Debt to Bank EBITDA, Continued
RECONCILIATION OF NON-GAAP MEASURES TOTAL DEBT TO BANK EBITDA, Continued Total Debt to Bank EBITDA is a ratio used in our debt agreements. Bank EBITDA (a non-GAAP measure) is a form of adjusted EBITDA, and represents earnings from Income (a GAAP measure), excluding interest income, interest expense,
Slide 133: Reconciliation of Non-GAAP Measures (Q4'23)
RECONCILIATION OF NON-GAAP MEASURES (Q4’23) CAGNY 2024 133