Church & Dwight: Time to Rethink the Portfolio?

Church & Dwight: Time to Rethink the Portfolio?

A case report prepared for

MG 495 Business Policy

Fall 1 2013

September 8, 2013

Church & Dwight: Time to Rethink the Portfolio?

1. INTRODUCTION

A. EXECUTIVE SUMMARY

Church & Dwight is a major manufacturer of household and personal products, including the popular Arm & Hammer brand along with well-known labels like Aim, Brillo, Nair, Oxi-Clean, and much more. Their trusted A & H trademark appears on a broad range of consumer and specialty products sold around the world. In 2011, the Company achieved a total sales revenue 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, (Wheelen & Hunger, 2012, p. 35-2). However with the entrance of other companies wanting the same market share, Church & Dwight is facing some market competition issues. The biggest challenge, which the company is facing is maintaining constant growth. The company expanded consumer products portfolio over 70 brands into the existing corporate structure while
continuing to scout for new avenues for 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 revenue of over $100 billion. As the world's largest producer and marketer of sodium bicarbonate-based products, Church & Dwight had, until recently, achieved consistent growth in sales and earnings. The core business of the company being the production of sodium bicarbonate.

The company tried to expand its other products lines, which is not an easy task. Despite the challenging business environment, the company envisioned that in 2012 they will deliver 9-10% earnings per share growth through continued relentless focus on the 10 key...