(Bloomberg) -- Clorox (NYSE:CLX) Co. Chief Executive Officer Linda Rendle said she’s committed to rebuilding the company’s margins after a turbulent 20 months of pandemic ups and downs, focusing on raising prices and holding down costs.
“We’re controlling what we can control,” Rendle, who took the helm last September after 17 years at the firm, said Tuesday in an interview with Bloomberg News. At 43, she is the youngest female CEO of an S&P 500 company.
Clorox has slumped from its pandemic-driven high, with shares trading higher than in 2019 but far below last year’s levels. Although well-known for disinfectant wipes and cleaning supplies, its brands are wide-ranging. Clorox also makes Burt’s Bees personal-care products, Brita filtered-water pitchers and Hidden Valley Ranch salad dressing.
Like many packaged-goods companies, Clorox is struggling with high commodity costs, labor shortages and supply-chain challenges. The Oakland, California-based company expects its gross margin, at 37% in the fiscal first quarter, to decline by 3 or 4 percentage points before beginning to expand again in the fourth quarter.
“We have every intention of restoring margins and we believe we can do it,” Rendle said. “I do see these things starting to ease as the global supply chain rights itself. Our mantra is to take every action that we can right now and we can always take additional action.”
To counter cost pressures, the company is increasing prices on 70% of its products this fiscal year -- on some of them, more than once. Rendle said she’s prepared to raise prices more if needed. “We do think this cost environment is more pervasive than was originally thought months ago,” she said.
Clorox capitalized early in the pandemic on consumers’ worries that the coronavirus spread easily on surfaces, which turned out not to be the case. Even so, Rendle said, the company’s customers are still cleaning more than they did pre-pandemic, with a more normal cold and flu season this winter likely to support use of wipes and sprays.
©2021 Bloomberg L.P.