CHURCH & DWIGHT CO., INC. (NYSE: CHD)
|500 Charles Ewing Blvd||Phone: 609-683-5900|
|Ewing, NJ||Fax: 609-497-7269|
|08628||Toll Free: 800-524-1328|
|United States||Map This Company|
|http://www.churchdwight.com||Hoover's coverage by Catherine Colbert|
Church & Dwight has operations, including manufacturing facilities, in the US, as well as in Australia, Brazil, China, France, and the UK. Furthermore, it exports its products to more than 80 other countries. The company's US manufacturing facilities are located in Pennsylvania, Missouri, New Jersey, Virginia, Ohio, California, and Iowa.
Church & Dwight has diversified its operations during the past 12 years from a US-centric business to a global company that derives more than 20% of sales from foreign countries.
Sales and Marketing
Church & Dwight sells a bulging portfolio of consumer products through a broad distribution platform that includes supermarkets, mass merchandisers, wholesale clubs, drugstores, convenience stores, dollar, pet, and other specialty stores and websites. These customers sell products directly to consumers. It also sells specialty products to industrial customers and distributors.
Three customers accounted for 34% of sales in 2012, including
In 2013 the company plans to increase its marketing spending to coincide with the launches of new premium products in power brands. Such campaigns include ARM & HAMMER ULTRA POWER 4X, a concentrated form of liquid laundry detergent, and a line of lubrication products under the Trojan brand.
The company's business segments are divided into three groups: Consumer Domestic, Consumer International, and Specialty Products.
The Consumer Domestic segment comprises eight power brands -- ARM & HAMMER, Trojan condoms, XTRA laundry detergent, Oxiclean stain removers and cleaning solutions, Nair depilatories, First Response home pregnancy and ovulation test kits, Orajel oral analgesics, and SpinBrush battery-operated toothbrushes -- as well as other household and personal care products. The segment contributes about 75% of sales.
The Consumer International segment sells primarily personal care products in international markets. Some of them share the same brands as its domestic product lines.
The Specialty Products segment is the nation's largest producer of sodium bicarbonate, which it sells together with other specialty inorganic chemicals for a variety of applications for the industrial, institutional, medical, and food industries. Church & Dwight's Specialty Products segment, which logs some 10% of its sales, is what sets the company apart from other consumer products companies. It manufactures antacid feed additives for cattle, industrial- and medical-grade sodium bicarbonate (used in kidney dialysis), potassium carbonate (used in video monitor glass), and industrial cleaning products. A small subsidiary in the UK produces specialty chemicals for European markets.
As part of its operations, Church & Dwight owns 50% joint venture Armand Products Company, which operates a potassium carbonate manufacturing plant in Muscle Shoals, Alabama. It also operates a Brazilian subsidiary in Rio de Janeiro, Quimica Geral do Nordeste (QGN).
Church & Dwight has grown steadily since 2008 despite the economic downturn. Indeed, the diversified consumer products company has logged both revenue and net income growth during the past decade even through the worst of the recession. In fiscal 2012 the company's revenue rose 6% to $2.9 billion as compared to $2.7 billion in 2011. Profits were up by 13% in 2012 vs. 2011. Church & Dwight grew its Consumer Domestic segment by 9%, offsetting both flat revenue in the Consumer International segment and revenue drops in the Specialty Products segment. The company's Consumer Domestic business was further spurred by increased product volumes and strategic acquisitions, such as Avid Health in 2012 and BATISTE dry shampoo in 2011.
Primarily, Church & Dwight has been investing in its consumer business in the US, where it sells most of these products. The segment houses Church & Dwight's eight "power brands," or well-recognized brand names: ARM & HAMMER, Trojan, XTRA, Oxiclean, Nair, First Response, Orajel, and SpinBrush. In 2012 the company was able to increase the market share of six of its eight power brands. New product rollouts, including its ARM & HAMMER Ultra Last detergent and Oxiclean Dishwashing Booster, have helped to fuel growth. Premium products, when tend to sell well industry-wide regardless of Wall Street woes, have also allowed Church & Dwight to weather poor economic times. Indeed, its portfolio consists of 60% premium products and 40% value brands.
Its largest segment, household, was responsible for bringing in 48% of Church & Dwight's revenue in 2012. The company has been able to maintain its momentum by increasing its manufacturing capacity and keep up with growth of its popular laundry segment. It did so by building a new integrated laundry detergent plant and distribution center located in York County, Pennsylvania. The facility replaced its existing laundry detergent plant in North Brunswick, New Jersey. It has also expanded its distribution of ARM & HAMMER laundry and pet care products, as well as Oxiclean and Orange Glo, in North America. Church & Dwight's expansion and upgrade effort was funded by its 2010 sale of the well-known Brillo brand of scouring pads to Armaly Brands, a manufacturer of polyester sponge brand Estracell.
While Church & Dwight's strong base in the US helped it weather the European recession in 2012, the company continues to concentrate on its international consumer business (which brought in more than 20% of revenue). It peddles brands such as Nair in foreign markets and sells Trojan condoms in China and the UK. Since purchasing SpinBrush, the company markets the top US seller in Australia, Canada, China, Japan, and the UK.
Church & Dwight continues to experience high raw material and energy costs. Historically, it has been able to mitigate the effects of cost increases primarily by implementing cost reduction programs. Maintaining tight controls on its overhead costs has enabled it to effectively navigate recent challenging economic conditions.
To consolidate its growing operations from four separate buildings to one 250,000-sq.-ft. one, Church & Dwight moved its headquarters within New Jersey in 2013. As part of the move, the company stands to benefit from potential financial incentives approved by the state's Economic Development Agency aimed at retaining jobs and creating new ones at the headquarters site. The new location on Charles Ewing Boulevard houses the executive offices and functions focused on sales, marketing, operations, finance, accounting, information technology, law, and human resources.
Mergers and Acquisitions
Its oral care products portfolio has been significantly fortified by a pair of acquisitions -- buying the pharmaceuticals business of Del Laboratories (maker of Orajel) from Coty for about $380 million and purchasing