Church & Dwight: Time to Rethink the Portfolio?

Church & Dwight: Time to Rethink the Portfolio

EXECUTIVESUMMARY

Church & Dwight Co., Inc., was founded in 1846, and from than onwards company has shows a steady growth every year. In 2011, the Company achieved a TSR of 35%. Over the past decade, the Company delivered an annual TSR of approximately 19% to its shareholders, significantly better than the 1% TSR of the S&P 500 stock index during the same period. As company has entered into the new market, so Church & Dwight Co is facing some a global market. The biggest challenge, which company is facing at present is maintain constant growth. Firm’s expanded consumer products portfolio of 80 brands into the existing corporate structure while continuing to scout for new avenues of growth. This is no easy task as it competes for market share with such formidable consumer products powerhouses as Colgate-Palmolive, Clorox, and Procter & Gamble, commanding combined sales of over $100 billion. The core business of the company is production of sodium bicarbonate. Company wanted to expand itself in the other products, which is not an easy task. Despite the challenging business environment, company believe that in 2012 they will deliver 9-10% earnings per share growth through continued relentless focus on the 10 key areas that contributed to their outstanding TSR results over the past 10 years. In order to achieve their goal, they have targeted, organic sales growth of 3-4%, 25-50 basis points of gross margin expansion, maintaining strong marketing spending at approximately 13% of net revenue, and continued tight management of overhead costs. Company believes that organic sales growth will be driven by the outstanding pipeline of new products and continued strong marketing support of our Power Brands.

THE SITUATION

The company was founded in 1896 to unify two companies created by John Dwight of Massachusetts and his brother-in-law, Austin Church of Connecticut. Their partnership had begun in...