(Reuters) - Clorox (NYSE:CLX) Co raised its annual profit forecast on Tuesday after beating quarterly earnings expectations, banking on effects of price hikes taken to offset escalating costs.
Consumer good companies, including Clorox, have been increasing product prices steadily over the last few years to protect profits from costs tied to manufacturing and logistics.
Peers Colgate-Palmolive (NYSE:CL) and Kimberly-Clark (NYSE:KMB) have also raised their respective sales and profit forecasts in recent weeks on the back of higher product prices.
Benefits of pricing and easing commodity costs helped the company boost its margins by 40 basis points to 42.2%.
The household staples maker now forecasts adjusted earnings between $5.80 and $5.95 per share in 2024, compared with its prior outlook range of $5.30 to $5.50 per share.
Excluding one-off items, Clorox earned $1.71 cents per share, topping analysts' estimate of $1.37 per share.
However, due to disruptions caused by the August cyberattack and charges incurred related to the divestiture of its Argentina business, the Pine-Sol manufacturer maker now expects annual net sales to be down at the low end of low single digits range and reported a downbeat quarterly sales.
"While we experienced short-term cyberattack-related supply constraints in a few areas, which impacted sales, we expect to fully restore lost distribution by the end of the fourth quarter," said Chief Executive Linda Rendle in a statement.
Kevin Jacobsen, Clorox's chief financial officer, said in an interview with Reuters that Clorox is expecting to recover distribution it lost in the cyberattack when retailers reset their stores shelves in this spring. The bleach maker has so far regained almost 90% of the market share it had lost, he said.
The company's net sales fell 5% to $1.81 billion in the quarter ending March 31, while analysts on average had estimated $1.87 billion, as per LSEG data.