Mixed Bag for Church & Dwight: Fool by Numbers

On Feb. 6, Church & Dwight (NYSE: CHD  ) , the company behind Arm & Hammer, among other products, released earnings for the year ended Dec. 31, 2006.

  • Church & Dwight beat expectations for both revenues and earnings per share with a 12% increase in sales and a 13.1% increase in EPS, but organic sales growth was just 2%.
  • Gross margins increased strongly, but didn't translate into expanding net margins.
  • Operating cash flow and free cash flow declined year over year, but the company said in its earnings release that it expects to deliver strong free cash flow. This will be something to watch as 2007 unfolds.

(Figures in thousands, except per-share data)

Income Statement Highlights

Avg. Est.

FY 2006

FY 2006

Change

Sales

$1,930,000

$1,945,661

$1,736,506

12.0%

Net Profit

--

$138,927

$122,906

13.0%

EPS

$2.02

$2.07

$1.83

13.1%

Diluted Shares

--

68,946

69,289

(0.5%)



Get back to basics with a look at the income statement.

Margin Checkup

FY 2006

FY 2005

Change*

Gross Margin

39.12%

36.68%

2.44

Operating Margin

12.96%

12.25%

0.71

Net Margin

7.14%

7.08%

0.06

*Expressed in percentage points

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets

FY 2006

FY 2005

Change

Cash + ST Invest.

$110,476

$126,678

(12.8%)

Accounts Rec.

$231,403

$187,863

23.2%

Inventory

$194,900

$156,149

24.8%



Liabilities

FY 2006

FY 2005

Change

Accounts Payable

No data

$145,444

N/A

Long-Term Debt

$792,925

$635,261

24.8%



Learn the ways of the balance sheet.

Cash Flow Highlights

FY 2006

FY 2005

Change

Cash From Ops.

$186,000

$190,000

(2.1%)

Capital Expenditures

$47,600

$37,700

26.3%

Free Cash Flow

$138,400

$152,300

(9.1%)



Find out why Fools always follow the money.

Related companies:

  • Procter & Gamble (NYSE: PG  )
  • Colgate-Palmolive (NYSE: CL  )
  • Clorox (NYSE: CLX  )
  • Unilever (NYSE: UL  )

Related Foolishness:

Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so checkFool.com for more of our in-depth discussion of what the numbers mean.

Colgate-Palmolive is a Motley Fool Inside Value selection. Unilever is an Income Investor selection. Need new ideas for your money? Talk stocks with other investors and our analysts when you give our newsletters a try free for 30 days.

At the time of publication, Nathan Parmelee had no position in any of the companies mentioned. Fool rules are here.


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