The need to disinfect every surface during the coronavirus pandemic has sales surging at Clorox (NYSE:CLX), which reported double-digit sales growth across all of its business units in its fiscal 2021 first quarter Monday.
Demand for its cleaning products has been monumental, and despite bringing on contract manufacturers to help produce more product, Clorox says disinfecting wipes will remain in short supply until 2021.
Cleaning up on disinfectants
Clorox reported organic sales growth of 27% in the quarter ended Sept. 30, driven by 39% gains in its household division and a 28% rise in health and wellness. Even so, its lifestyle and international segments also saw 17% increases in organic growth.
Swelling demand led profits to more than double in the period, rising 103% to $3.22 per share, with gross margin widening by 400 basis points to 48% and marking the eighth consecutive quarter of year-over-year expansion.
"We delivered another quarter of outstanding results to have a strong start to the fiscal year, with broad-based strength across our portfolio, driving double-digit sales growth in all reportable segments," CEO Linda Rendle said in a statement.
While the increase in consumer demand for cleaning products is a result of the pandemic, Clorox also benefited from more people cooking at home. Its grilling business in the household segment saw sales double in the first quarter. Clorox owns the Kingsford brand of charcoal.
As a result of its increased performance, Clorox raised its guidance for the full year and now expects to report earnings between $7.75 and $7.90 per share, up 5% to 8% from fiscal 2020. It had previously forecast a mid-single-digit decrease to mid-single-digit increase in earnings per share.