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Clorox wipes can be found in stores again — its CEO explains why

Brian Sozzi
·Editor-at-Large
·3 min read
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You may have a way better chance of finding Clorox's popular disinfecting wipes down the cleaning aisle of your supermarket now that the very worst of the COVID-19 pandemic ,consumer-product buying hysteria appears to be slowing just a bit.

"For the most part, people can find all the bleach they need and we are bringing other cleaners like Pine-Sol and sprays back online. Wipes we have made great progress on. We went from last quarter making about a million canisters of wipes per day for retail to a million and a half canisters of wipes, and we will increase that even more as we head into our fourth quarter," Clorox CEO Linda Rendle told Yahoo Finance Live. "They are still difficult to find, but more help is on the way and people are telling us more stories of finding them on the shelves."

Rendle — who joined Clorox in 2003 -- assumed the CEO position in September 2020 from long-time leader Benno Dorer. It's now Rendle's job to ensure the world is fully stocked with disinfecting supplies, especially amid what is likely lasting changes to how people think about cleaning surfaces (and frankly, themselves).

"We are seeing signs that the consumer has permanently changed their behavior in a number of categories, cleaning being one of them. We are doing everything we can to help them as they adjust their habits and lifestyles," Rendle added.

Containers of Lysol and Clorox wipes are on sale at a grocery store on Tuesday, Dec. 1, 2020, in Long Beach, Calif. (AP Photo/Ashley Landis)
Containers of Lysol and Clorox wipes are on sale at a grocery store on Tuesday, Dec. 1, 2020, in Long Beach, Calif. (AP Photo/Ashley Landis)

Clorox’s fiscal second quarter results reported earlier this month sheds light on the new reality that Rendle and her teams are navigating.

Sales exploded 27% from the prior year. Volume surged 23%. Earnings soared 39%. Sales and pre-tax earnings in Clorox’s health and wellness segment (which houses the prized cleaning business) increased an impressive 42% and 84%, respectively. These are growth rates that would have been unimaginable pre-pandemic — but may remain the new medium-term norm at a Clorox settling into a post health pandemic world.

For its full fiscal year that ends in June, Clorox sees organic sales growth of 10% to 13%. Earnings are expected to be up 9% to 12%.

Wall Street is now closely watching whether Clorox could pull off another feat — successfully raising prices to offset inflation in key inputs such as resin. Concerns on the profit impact to Clorox from inflation have weighed on the stock in recent months, analysts say.

Shares of Clorox are down about 16% in the past six months versus a 16% gain for the S&P 500.

Rendle said she thinks Clorox has pricing power in the market, but is not yet ready to pull the trigger on price hikes.

"The very first thing we do is employ the huge toolbox we have to deal with costs over the short to mid- and long-term. That's a focus on strong cost savings, a discipline which we deliver year after year. We delivered on our goals in fiscal year 2020 and are on track to deliver in fiscal 2021. We have no news to report [on prices] but we are looking at it," Rendle explained. "Given the strength of our brands — which have never been stronger as about 90% of our portfolio has stable or growing household penetration — we do see the pricing power to do that."

Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.

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