Armkel, LLC

Whether you call it saleratus (aerated salt), sodium bicarbonate, or plain old baking soda, Church & Dwight is a top maker worldwide of the powder under the ARM & HAMMER name. The consumer products company has expanded the key brand into a products portfolio powerhouse, with laundry detergent (the company's top consumer business by sales), bathroom cleaners, carpet deodorizer, air fresheners, toothpaste, antiperspirants, industrial-grade carbonates, cat litter, and animal nutrition. The company's other brand names include XTRA, Oxiclean, Nair, First Response, Orajel, and SpinBrush. Church & Dwight, which operates globally, also makes Trojan-brand condoms.

Geographic Reach

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 13 years from a US-centric business to a global company that derives about 20% of its sales from foreign countries.

Operations

The company's business segments are divided into three groups: Consumer Domestic, Consumer International, and Specialty Products.

The Consumer Domestic segment comprises nine 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 more than 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).

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 35% of sales in 2013, including Wal-Mart and its affiliates, which generated about 24%.

In 2013 the company increased 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.

Financial Performance

Church & Dwight has grown steadily since 2009 despite the economic downturn. In 2013 the company reported a 9% increase in sales driven by a 31% increase in Personal Care Products' revenues and a 2% rise in Household Products sales thanks to a US sales increase of $256.6 million from increased gummy vitamin dietary supplement, ARM & HAMMER liquid laundry detergent, OXICLEAN laundry additives, TROJAN products, and FIRST RESPONSE diagnostic kits sales. Its consumer international sales also increased by $22.7 million. These increases were partially offset by lower specialty products revenues due to lower product sales of animal nutrition products, mitigated by higher bulk sales of sodium bicarbonate.

In 2013 Church & Dwight posted a 13% rise in net income of $394.4 million mainly due to increased revenues coupled with higher investment earnings offset by a growth in marketing costs, and selling, general, and administrative expenses, and higher interest expenses.

Although cash flow in operating activities had trended upward trend from 2009 to 2012, it decreased by $24 million in 2013 due to increased accounts payable and accrued expenses (which more than doubled) and higher other operating assets and liabilities, asset impairment charges, and other asset write-offs. These were partially offset by increased net income, decreased deferred income taxes, and lower Equity in net earnings of affiliates.

Strategy

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 2013 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 45% of Church & Dwight's revenues in 2013. 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 about 20% of revenues). 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 expand its gummy vitamin production capacity, in 2014 it began construction of a new production line at its manufacturing facility in Pennsylvania.

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.

▲ Show Less▼ Show Full Description


Armkel, LLC


469 N Harrison St
Princeton, NJ 08540-3510
Phone: 1 (609) 683-5900
www.naircare.com

STATS


  • Employer Type: Unknown
  • Mbr: Robert Davies
  • Data Processing Executive: Karen Egan
  • Director: Bradley Irwin

Major Office Locations

  • Princeton, NJ

Become a Vault Basic Member

Complete your Vault Profile and get seen by top employers