About Armkel, LLC

Whether you call it sodium bicarbonate or plain old baking soda, Church & Dwight is a top maker of the powder under the ARM & HAMMER brand. The global 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 products. Beyond Arm & Hammer, the company's top brands include XTRA and Oxiclean detergents, Nair depilatories, First Response pregnancy tests, Orajel toothpaste, L'il Critters and Vitafusion gummy vitamins, SpinBrush toothbrushes, and Trojan-brand condoms.

Operations

The company operates three segments. The Consumer Domestic segment, which made up 76% of the company's sales during 2015, comprises its 10 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, SpinBrush battery-operated toothbrushes, and L'il Critters and Vitafusion gummy vitamins -- as well as other household and personal care products. The Consumer International segment (15% of sales) sells primarily personal care products in international markets, including some of its domestic brand lines.

Church & Dwight's Specialty Products segment (9% of sales) is what sets the company apart from other consumer products companies. As the nation's largest producer of sodium bicarbonate, it sells a variety of applications for the industrial, institutional, medical, and food industries, manufacturing 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).

Geographic Reach

In addition to the US, where it generated 85% of its sales during 2015, Church & Dwight exports its products to more than 90 other countries. The company's manufacturing facilities and other operations in the US are in Pennsylvania, Missouri, New Jersey, Virginia, Ohio, Wyoming, California, and Iowa. Its international facilities are in Australia, Brazil, China, France, Mexico, Canada, and the UK. The company's US manufacturing facilities are located.

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 2015, including Wal-Mart and its affiliates, which generated about 24%.

In 2014 Major League Baseball and Church & Dwight signed a multi-year, multi-category sponsorship agreement making ARM & HAMMER and Oxiclean "The Official Laundry Detergent and Stain Remover of MLB".

Overall, the company has boosted its marketing spend over the past several years to support new product launches. It spent $417.5 million on marketing during fiscal 2016 (ended January 2016), up from $416.9 million and $399.8 million in the prior two fiscal years, respectively.

Financial Performance

Church & Dwight's annual revenues and profits have been reaching record highs for the past several years as the company has expanded its product and brand lines and has entered new geographic markets.

The company's revenue climbed 3% to $3.39 billion during fiscal 2016 (ended January 2016) with most of the growth coming from a 5% jump in Consumer Domestic product sales stemming from the Lil' Drug Store Brands acquisition as well as new product launches including Arm & Hammer Clump & Seal cat litter, Arm & Hammer lightweight liquid laundry detergent, and Batiste dry shampoo. Declining sales of the Spinbrush toothbrushes, Trojan condoms, and XTRA laundry detergent offset some of the company's top-line gains. Specialty Product sales rose 7% with the VI-COR acquisition, while international sales rose in Europe, Australia, and Mexico after excluding unfavorable foreign exchange rates.

Despite revenue growth in FY2016, Church & Dwight's net income dipped 1% to $410.4 million mostly due to costs associated with its acquisitions of the Lil' Drug Store Brands and VI-COR businesses, as well as research & development costs. The company's operating cash levels jumped 12% to $606.1 million during the year thanks to a rise in cash earnings and favorable working capital changes stemming from lower accounts receivables from factoring as well as higher accounts payable and accrued expenses from the timing of invoice payments.

Strategy

Church & Dwight continues to introduce new products based on its 10 well-recognized "power brands." During 2015, for example, the company launched innovative new products such as the ARM & HAMMER Clump & Seal Microguard cat litter which destroys and prevents odors, a new dual-chamber dose Oxiclean laundry product, a new beauty line of adult Vitafusion brand vitamins, a GROOVE condom and Riviera lubricant under the Trojan brand, and a bluetooth-enabled Pregnancy Pro product under the First Response brand. In 2013 the company was able to increase the market share of six of its eight power brands by introducing new products such as ARM & HAMMER Ultra Last detergent and Oxiclean Dishwashing Booster.

Beyond developing and launching new and differentiated products, Church & Dwight follows several key strategic initiatives: maintain competitive marketing and trade spending, tightly control its cost structure, and pursue valuable brand acquisitions. It also intends to continue to boost its international product sales, and maintain an offering of premium and value brand products. The company’s long-term mission is to secure annual organic revenue growth of 3- 4%, gross margin expansion, and tight management of overhead costs.

While Church & Dwight's strong base in the US has helped it weather regional downturns, the company continues to concentrate on its international consumer business. 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.

Mergers and Acquisitions

Church & Dwight has acquired one company per year on average over the past several years to expand its brand and product lines.

In January 2016, the company bought California-based Spencer Forrest, Inc., which makes the TOPPIK brand of hair building fibers, for a total of $175 million.

In January 2015, Church & Dwight expanded its Specialty Product lines after buying Iowa-based Varied Industries Corporation (VI-COR), which makes and sells feed ingredients for cows, beef cattle, poultry, and other livestock.

In September 2014, the company acquired the REPHRESH and REPLENS feminine care brands from Lil' Drug Store Products Inc.

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Armkel, LLC

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

Stats

  • Employer Type: Public
  • Mbr: Bradley A Casper
  • Mbr: Robert A Davies

Major Office Locations

  • Princeton, NJ

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