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Clorox increasingly confident in 2H13 outlook

On the company's Q2 earnings conference call, Clorox (CLX) CEO Don Knauss said based on the 5% sales and 10% EPS growth in 1H13, continued growth in all categories, and a pipeline of second half product innovation, he felt "more optimistic about the full year outlook." For FY13, Clorox anticipates free cash flow of 9%-10% of sales. The company continues to expect EBIT margin will increase by 25-50 bps for FY13, reflecting strong cost savings and the benefit of price increases. Commodity costs are estimated to be about flat versus the prior year. Capital expenditures are expected to be approximately $200M-$210M. Management did note that its updated FY13 outlook reflects a range of 5c-10c of diluted earnings per share impact from an expected currency devaluation in Venezuela and the continued difficulty of taking pricing in that country. Overall, management is increasingly bullish on the company's prospects for the second half of FY13.