切遲杜威 (CHD) 2023 Q2 法說會逐字稿

Good morning, ladies and gentlemen, and welcome to Church & Dwight Second Quarter 2023 Earnings Conference Call. Before we begin, I have been asked to remind you that on this call, the company's management may make forward-looking statements regarding, among other things, the company's financial objectives and forecasts. These statements are subject to risks and uncertainties and other factors that are described in detail in the company's SEC filings. I would now like to introduce your host for today's call, Mr. Matt Farrell, President and Chief Executive Officer of Church & Dwight. Please go ahead, sir.

早上好，女士們、先生們，歡迎參加 Church & Dwight 2023 年第二季度收益電話會議。在我們開始之前，我被要求提醒您，在這次電話會議上，公司管理層可能會就公司的財務目標和預測等做出前瞻性陳述。這些聲明受到風險和不確定性以及公司向 SEC 文件中詳細描述的其他因素的影響。現在我想介紹一下今天電話會議的主持人，Church & Dwight 總裁兼首席執行官馬特·法雷爾 (Matt Farrell) 先生。請繼續，先生。

Thank you, operator. Okay. Good morning, everyone. Thanks for joining us today. I'll begin with a review of Q2 results, and then I'll turn the call over to Rick Dierker, our CFO. And when Rick has wrapped up, we'll open the call up for questions. Q2 was an excellent quarter for Church & Dwight. Reported revenue was up 9.7%, exceeding our 7% outlook. And this is thanks to strong results from several brands, including our 2 most recent acquisitions, HERO and THERABREATH. Organic sales grew 5.4%. This exceeded our 3% Q2 outlook. Gross margin expanded 270 basis points and marketing as a percentage of sales increased 130 basis points. Two items that are worthy of note. First one is 18% of our global sales were purchased online compared to 17.5% in the year-ago quarter. And second, private label is stable in our categories, both in the U.S. and internationally.

謝謝你，接線員。好的。大家，早安。感謝您今天加入我們。我將首先回顧第二季度的業績，然後將電話轉給我們的首席財務官 Rick Dierker。當 Rick 結束後，我們將開始提問。第二季度對於 Church & Dwight 來說是一個出色的季度。報告收入增長 9.7%，超過我們 7% 的預期。這要歸功於多個品牌的強勁業績，包括我們最近收購的兩個品牌 HERO 和 THERABREATH。有機銷售額增長 5.4%。這超出了我們 3% 的第二季度預期。毛利率擴大了 270 個基點，營銷佔銷售額的百分比增加了 130 個基點。有兩個項目值得注意。第一個是我們全球銷售額的 18% 是在線購買的，而去年同期為 17.5%。其次，自有品牌在我們的品類中保持穩定，無論是在美國還是在國際上。

Adjusted EPS was $0.92, and this was $0.14 higher than our $0.78 EPS outlook. And that result was driven by higher sales, higher-than-expected gross margin and a lower tax rate. Now I'm going to comment on each business. First up is the U.S. The U.S. consumer business had 6.3% organic sales growth and 6 of our 14 power brands held or gained market share in the quarter. And for context, the brands that grew share represent 65% of our U.S. sales.

調整後每股收益為 0.92 美元，比我們預期的 0.78 美元高出 0.14 美元。這一結果是由更高的銷售額、高於預期的毛利率和更低的稅率推動的。現在我將對每個業務進行評論。首先是美國。美國消費者業務的有機銷售額增長了 6.3%，我們的 14 個強勢品牌中有 6 個在本季度保持或增加了市場份額。就背景而言，份額增長的品牌占我們美國銷售額的 65%。

Now I want to look at a few of the more important categories in the U.S., starting with laundry. So laundry is a real success story in Q2. Church & Dwight closed out the quarter as the fastest-growing overall laundry detergent, liquid detergent, unit dose detergent and scent booster manufacturer in both dollar and unit share. ARM & HAMMER Liquid Laundry continues to see strong consumption growth, driven in part by the continued trade down to value brands and in part by media support behind our new, Give it the HAMMER master brand advertising campaign. ARM & HAMMER Liquid Laundry detergent grew share by 90 basis points in the quarter, so we're now at 14.5% share. And XTRA, which is in the extreme value segment of the category, grew consumption 7.2% and gained 20 basis points of share in Q2.

現在我想看看美國的一些更重要的類別，從洗衣開始。因此，洗衣店在第二季度是一個真正的成功故事。 Church & Dwight 在本季度結束時成為整體洗衣粉、液體洗滌劑、單位劑量洗滌劑和香味增強劑製造商（按美元和單位份額計算）增長最快的製造商。 ARM & HAMMER Liquid Laundry 的消費量繼續強勁增長，部分原因是對價值品牌的持續關注，部分原因是我們新推出的“Give it the HAMMER 主品牌”廣告活動背後的媒體支持。 ARM & HAMMER 液體洗衣粉的份額在本季度增長了 90 個基點，因此我們現在的份額為 14.5%。 XTRA 屬於該類別的極值部分，第二季度消費增長了 7.2%，份額增加了 20 個基點。

ARM & HAMMER Litter also continues to perform extremely well with 12.6% growth outpacing the category and growing share. Consumers continue to choose ARM & HAMMER Litter offerings and our orange box in particular, offers great value for the cost constrained cat owner.

ARM & HAMMER Litter 也繼續表現出色，增長超過同類產品 12.6%，並且份額不斷增長。消費者繼續選擇 ARM & HAMMER 貓砂產品，特別是我們的橙色盒子，為成本有限的貓主人提供了巨大的價值。

Turning now to Personal Care. BATISTE grew consumption 12% in the quarter as we continue to build dry shampoo awareness and drive household penetration. While TROJAN delivered share growth and increased share to 68.3% in Q2. HERO, which was acquired last October, grew year-over-year consumption by 66%, gating 4.7 share points to achieve a 17.2% market share in the total acne treatment category. The number of retail distribution points has tripled since we acquired the brand, and we still have room to run as we expand across all classes of trade. The HERO team is doing a spectacular job growing this business, and there continues to be a great deal of excitement at Church & Dwight about the HERO brand. Similarly, THERABREATH, which was acquired in 2021, is performing extremely well with 100% year-over-year consumption growth in the quarter. THERABREATH grew share of 5.6 points year-over-year to a 13% share of the mouthwash category. The mouthwash category grew 14% in the quarter, and THERABREATH accounted for 50% of the category growth. Distribution of THERABREATH has more than doubled since the acquisition date. So THERABREATH is now the #2 non-alcohol mouthwash brand and the clear #3 in total mouthwash. And we expect this brand to be a long-term grower for Church & Dwight. Regarding a couple of businesses that depressed our '22 results, WATERPIK is stabilizing, with Q2 coming in close to plan, and this is similar to Q1. While VITAFUSION was close to our plan in the first half, our consumption was down in Q2, 9%, partly due to distribution losses at some retailers due to our supply issues in 2022.

現在轉向個人護理。隨著我們繼續提高乾洗洗髮水的認知度並推動家庭普及，巴蒂斯特本季度的消費量增長了 12%。而 TROJAN 則實現了份額增長，第二季度份額增至 68.3%。去年 10 月被收購的 HERO 的消費量同比增長 66%，佔據了 4.7 個百分點的份額，在整個痤瘡治療類別中獲得了 17.2% 的市場份額。自從我們收購該品牌以來，零售分銷點的數量增加了兩倍，而且隨著我們向所有貿易類別的擴張，我們仍然有運營空間。 HERO 團隊在發展這項業務方面做得非常出色，而且 Church & Dwight 仍然對 HERO 品牌感到非常興奮。同樣，2021 年收購的 THERABREATH 表現極為出色，本季度消費同比增長 100%。 THERABREATH 在漱口水類別中的份額同比增長 5.6 個百分點，達到 13%。漱口水品類本季度增長 14%，THERABREATH 佔該品類增長的 50%。自收購之日起，THERABREATH 的分銷量增加了一倍多。因此，THERABREATH 現在是排名第二的無酒精漱口水品牌，也是排名第三的透明漱口水品牌。我們預計該品牌將成為 Church & Dwight 的長期增長點。對於一些影響我們 22 年業績的業務，WATERPIK 正在穩定，第二季度接近計劃，這與第一季度類似。雖然 VITAFUSION 上半年接近我們的計劃，但我們第二季度的消費量下降了 9%，部分原因是我們 2022 年的供應問題導致一些零售商的分銷損失。

The good news is the gummy category was up 1% in Q2 after 3 successive down quarters. And our job now is to win back retailer confidence and then regain lapsed consumers. So we expect both businesses, this is WATERPIK and VITAFUSION year-over-year to be flat net sales, so although not hurting us in '23 versus '22.

好消息是，軟醣類別在連續三個季度下跌後，第二季度上漲了 1%。我們現在的工作是贏回零售商的信心，然後重新贏得流失的消費者。因此，我們預計 WATERPIK 和 VITAFUSION 這兩項業務的淨銷售額將同比持平，因此儘管 23 年與 22 年相比不會對我們造成傷害。

Next up is international. Our international team is doing a great job, delivering organic sales growth of 6.1% in Q2, driven by broad-based growth in every 1 of our 6 subsidiaries in all 5 regions of our Global Markets Group. And finally, Specialty Products. Specialty Products organic sales decreased 6.5%, but this is primarily due to lower volume in the dairy business as lower-priced imports returned to the U.S. market. I'm going to wrap up my comments right now by saying consumption on our consumer products businesses are strong. A return to volume growth is expected in the second half. In fact, July is off to a very strong start. Our value offerings are performing well, as are our premium offerings, acquisitions are on track. And because we had an excellent first half, and we have a strong outlook for the second half, we are in a position to significantly increase our marketing spend. Last year, we pulled back on marketing due to our fill rate issues. When we started 2023, we intended to increase our marketing from 10% of sales in 2022 to 10.5% of sales in 2023 and then 11% in 2024. So we now intend to ramp up marketing to 11% of sales this year in 2023 and in support of our brands and new product launches as business gets back to normal. And now I'm going to turn it over to Rick to give you some color on Q2 and the full year and other investments that we'll be making in the second half.

接下來是國際。我們的國際團隊表現出色，在全球市場集團所有 5 個地區的 6 家子公司中每一個的廣泛增長的推動下，第二季度的有機銷售額增長了 6.1%。最後是特色產品。特色產品有機銷售額下降 6.5%，但這主要是由於低價進口產品返回美國市場導致乳製品業務銷量下降。我現在要總結我的評論，我們的消費品業務的消費強勁。預計下半年銷量將恢復增長。事實上，七月已經有了一個非常強勁的開局。我們的價值產品表現良好，我們的優質產品也表現良好，收購正在進行中。由於我們上半年表現出色，並且下半年前景樂觀，因此我們有能力大幅增加營銷支出。去年，由於填充率問題，我們取消了營銷活動。當我們開始 2023 年時，我們打算將營銷佔銷售額的比例從 2022 年的 10% 增加到 2023 年的 10.5%，然後到 2024 年增加到 11%。因此，我們現在打算在 2023 年將營銷佔銷售額的比例提高到 11%，隨著業務恢復正常，支持我們的品牌和新產品的發布。現在我將把它交給 Rick，為您提供有關第二季度和全年以及我們將在下半年進行的其他投資的一些信息。

Thank you, Matt, and good morning, everybody.

謝謝你，馬特，大家早上好。

We'll start with EPS. Second quarter adjusted EPS was $0.92, up 21% to the prior year. As Matt mentioned, the $0.92 was better than our $0.78 outlook, primarily due to continued strong consumer demand for many of our products and higher-than-expected gross margins as well as a lower tax rate. Net sales was up 9.7% and organic sales were up 5.4%. Almost half of the reported revenue growth year-over-year was HERO. Organic sales were once again driven by pricing in Q2 with volumes slightly down. That slight decline was better than expected and turning to the second half, we continue to expect a return to volume growth. Our second quarter gross margin was 43.9%, a 270 basis point increase from a year ago, primarily due to productivity pricing and strong contributions from higher-margin acquisitions that are offsetting inflation. This result exceeded our expectations for the quarter as we saw a greater impact from productivity programs, a better product mix driven by our recent acquisitions.

我們將從 EPS 開始。第二季度調整後每股收益為 0.92 美元，比去年同期增長 21%。正如 Matt 提到的，0.92 美元的預期好於我們 0.78 美元的預期，主要是由於消費者對我們許多產品的持續強勁需求、高於預期的毛利率以及較低的稅率。淨銷售額增長 9.7%，有機銷售額增長 5.4%。所報告的同比收入增長幾乎有一半來自 HERO。第二季度的定價再次推動有機銷售，銷量略有下降。這種小幅下降好於預期，下半年我們繼續預計銷量將恢復增長。我們第二季度的毛利率為 43.9%，比去年同期增長 270 個基點，這主要是由於生產力定價以及抵消通脹的高利潤收購的強勁貢獻。這一結果超出了我們對本季度的預期，因為我們看到生產力計劃產生了更大的影響，我們最近的收購推動了更好的產品組合。

Let me walk you through the Q2 bridge. Gross margin was made up of the following: Positive 280 basis points impact from price/volume mix, positive 120 basis points from acquisitions, a positive 160 basis point impact from productivity and 10 basis points from currency, partially offset by a drag of 300 basis points due to higher manufacturing costs. For the balance of the year, we expect this trend to continue.

讓我帶您穿過 Q2 橋。毛利率由以下因素組成：價格/數量組合帶來 280 個基點的正影響，收購帶來的 120 個基點的正影響，生產率帶來的 160 個基點的正影響，以及貨幣帶來的 10 個基點的正影響，部分被 300 個基點的拖累所抵消由於製造成本較高而得分。對於今年餘下的時間，我們預計這一趨勢將持續下去。

Moving to marketing. Marketing was $29 million, up year-over-year. Marketing expense as a percentage of net sales was 9.1% or 130 basis points higher than Q2 of last year. For SG&A, Q2 adjusted SG&A increased 60 basis points year-over-year. Other expense all in was $24 million, a $9.1 million increase due to higher average interest rates. For the full year, we now expect other expense of approximately $100 million. We do not have any looming long-term debt refinancing. In fact, other than the $200 million left in our term loan, August of 2027 is the timing of our next maturity.

轉向營銷。營銷收入為 2900 萬美元，同比增長。營銷費用占淨銷售額的百分比為 9.1%，比去年第二季度高出 130 個基點。對於 SG&A，第二季度調整後的 SG&A 同比增長 60 個基點。其他費用總計 2,400 萬美元，由於平均利率上升而增加了 910 萬美元。我們現在預計全年其他費用約為 1 億美元。我們沒有任何迫在眉睫的長期債務再融資。事實上，除了我們的定期貸款還剩下 2 億美元之外，2027 年 8 月就是我們下一次到期的時間。

For income tax, our effective rate for the quarter was 17.9% compared to 24.1% in 2022, a decrease of 620 basis points driven by a higher tax benefit from stock option exercises, we now expect the full year rate to be approximately 22%. And now to cash, for the first 6 months of 2023, cash from operating activities increased to $509 million due to higher cash earnings and improvements in working capital.

對於所得稅，我們本季度的有效稅率為 17.9%，與 2022 年的 24.1% 相比，由於股票期權行使帶來的稅收優惠增加，下降了 620 個基點，我們現在預計全年稅率約為 22%。現在轉向現金，由於現金收入增加和營運資本改善，2023 年前 6 個月，經營活動現金增加至 5.09 億美元。

Turning to the full year outlook. Given the strength of our Q2 results and our confidence for the remainder of the year, we're raising our outlook for sales, gross margin, EPS and cash flow. We now expect the full year 2023 reported sales growth to be approximately 8%, and organic sales growth to be approximately 5%. Given the strength of the business, we see opportunities to make incremental investments in our brands and capabilities in future quarters. We now expect full year reported gross margin to expand 200 basis points. Compared to our previous outlook, we see commodity cost favorability, higher productivity and faster growth from our higher margin recent acquisitions. While we have seen some pockets of lower inflationary pressure, since our prior outlook, we continue to expect net inflation for the year. For perspective, we expect $120 million of manufacturing cost increases in 2023, much better than the $290 million we saw in 2021 and the $250 million in 2022, but still elevated from historical levels.

轉向全年展望。鑑於我們第二季度的強勁業績以及我們對今年剩餘時間的信心，我們正在提高對銷售額、毛利率、每股收益和現金流的預期。我們現在預計 2023 年全年報告銷售額增長約為 8%，有機銷售額增長約為 5%。鑑於業務的實力，我們看到了未來幾個季度對我們的品牌和能力進行增量投資的機會。我們現在預計全年報告的毛利率將擴大 200 個基點。與我們之前的展望相比，我們認為近期收購的利潤率較高，商品成本有利，生產率更高，增長更快。儘管我們看到一些地區通脹壓力較低，但自我們之前的展望以來，我們仍然預計今年將出現淨通脹。從長遠來看，我們預計 2023 年製造成本將增加 1.2 億美元，遠好於 2021 年的 2.9 億美元和 2022 年的 2.5 億美元，但仍高於歷史水平。

Speaking of history, if we look back at history from 2010 to 2019, we typically had 2% of COGS as inflation. During the COVID impacted years of 2020 to 2022, we saw an 8% of COGS impact. And in 2023, we're seeing about a 4% inflation rate. So currently, we see commodities like ethylene down 20% year-over-year. However, going the other way, we see soda ash, up 50%. Soda ash is now used with lithium for lithium carbonate, which is then used in lithium batteries and solar panels. This demand spike, combined with pressure on the supply side. So for example, China is the largest supplier of soda ash globally and has had intermittent supply issues, and that's causing upwards pressure on price.

說到歷史，如果我們回顧 2010 年至 2019 年的歷史，我們通常將 COGS 的 2% 視為通貨膨脹。在 2020 年至 2022 年受新冠疫情影響期間，我們看到了 8% 的銷貨成本影響。到 2023 年，我們預計通脹率約為 4%。目前，我們看到乙烯等大宗商品同比下跌 20%。然而，反之亦然，我們看到純鹼上漲了 50%。純鹼現在與鋰一起用於生產碳酸鋰，然後用於鋰電池和太陽能電池板。需求激增，加上供應方面的壓力。例如，中國是全球最大的純鹼供應國，但間歇性出現供應問題，這導致價格上漲。

So the point is we're not in a deflationary period as of yet. Wrapping up gross margins, we have made a lot of progress. However, for the full year, we still expect to be about 200 basis points below our pre-COVID margin levels. So a lot of opportunity over the next few years. We intend to increase marketing as a percent of net sales to 11%. This is great news as we previously anticipated getting back up to 11% in 2024 and the fact that we're able to get there sooner than initially anticipated will position the business well for the future.

所以關鍵是我們目前還沒有處於通貨緊縮時期。總結毛利率，我們取得了很大進步。然而，我們仍預計全年利潤率將比新冠疫情前的水平低約 200 個基點。所以未來幾年會有很多機會。我們打算將營銷占淨銷售額的百分比提高到 11%。這是個好消息，因為我們之前預計 2024 年將恢復到 11%，而且我們能夠比最初預期更早實現這一目標，這將為業務的未來做好準備。

We expect SG&A both in dollars and as a percent of sales to increase compared to 2022. The increase in SG&A is expected to be larger than what was assumed in our prior outlook as the strong business performance increases incentive compensation and as we make strategic investments. As in past years, when we have strong business performance we're invested for the future. These investments are focused in 2 areas: First, growth with higher marketing investments and R&D investments around MPD as well as accelerating product registrations in international markets. Second would be efficiency, investments in automation and technology. We now expect full year EPS to be approximately 6%. And as a reminder, our EPS guidance includes a step-up of marketing that we're talking about in higher SG&A. We now expect full year cash flow from operations to be approximately $1 billion. Previously, we expected to be $950 million. The $50 million increase is driven by higher cash earnings and an improvement in working capital. Our full year CapEx plan continues to be approximately $250 million as we continue to make capacity investments, and we expect to return to historical levels of 2% of sales by 2025.

我們預計，與 2022 年相比，SG&A（以美元計）和占銷售額的百分比都會有所增加。由於強勁的業務業績增加了激勵性薪酬以及我們進行了戰略投資，SG&A 的增幅預計將大於我們之前展望中的假設。與過去幾年一樣，當我們擁有強勁的業務業績時，我們就會為未來進行投資。這些投資主要集中在兩個領域：首先，通過圍繞 MPD 進行更高的營銷投資和研發投資以及加快國際市場上的產品註冊來實現增長。其次是效率以及對自動化和技術的投資。我們現在預計全年每股收益約為 6%。提醒一下，我們的 EPS 指導包括我們在更高的 SG&A 中討論的營銷升級。我們現在預計全年運營現金流約為 10 億美元。此前，我們預計為 9.5 億美元。增加 5000 萬美元的原因是現金收入增加和營運資本改善。隨著我們繼續進行產能投資，我們的全年資本支出計劃繼續約為 2.5 億美元，我們預計到 2025 年將恢復到佔銷售額 2% 的歷史水平。

Strong performance in the first half of the year drove 12% EPS growth. As a result of accelerating investments, we expect second half EPS growth to be flat. And for Q3 specifically, we have a strong outlook and expect reported sales growth of 8%, approximately 4% for organic and gross margin expansion.

上半年的強勁業績推動每股收益增長 12%。由於投資加速，我們預計下半年每股收益增長將持平。具體來說，對於第三季度，我們的前景十分樂觀，預計銷售額將增長 8%，有機利潤和毛利率將增長約 4%。

We also expect a significant increase year-over-year in marketing spend as well as SG&A. Adjusted EPS is expected to be $0.66 per share, a 13% decrease from last year's adjusted Q3 as investment spending is weighted more towards Q3. So to summarize, a strong 6 months of the year are behind us, a return to volume growth in the back part of the year and a lot of momentum as we move into 2024. And with that, Matt and I would be happy to take questions.

我們還預計營銷支出以及銷售、一般管理費用將同比大幅增長。調整後每股收益預計為每股 0.66 美元，比去年調整後第三季度下降 13%，因為投資支出更多地偏向第三季度。總而言之，今年強勁的 6 個月已經過去，今年下半年銷量將恢復增長，並且在進入 2024 年時將出現強勁勢頭。因此，馬特和我很樂意接受問題。

(Operator Instructions)

（操作員說明）

Your first question comes from Chris Carey from Wells Fargo Securities.

你的第一個問題來自富國銀行證券公司的克里斯·凱里。

So on my math, this is the first return to organic sales growth in Personal Care since the beginning of 2021, unless I'm calculating that wrong? And clearly, there was some commentary around WATERPIK and vitamins being on plan. Nevertheless, it does feel like a bit of a step change on this kind of important area of the P&L. And I wonder if you could just frame what's going on, on an underlying basis in that business to drive this reacceleration? I know comps are getting easier, but we hear so much about WATERPIK and FLAWLESS and sometimes not the rest of the underlying drivers of organic sales here. And really, I'm just trying to get a sense of the full delivery of this personal care portfolio into the back half of the year, specifically as the HERO comes into the base?

因此，根據我的計算，這是自 2021 年初以來個人護理領域首次恢復有機銷售增長，除非我計算錯誤？顯然，有一些關於正在計劃中的 WATERPIK 和維生素的評論。儘管如此，在損益表的這一重要領域，這確實感覺像是一個逐步的改變。我想知道您是否可以在該業務的根本基礎上描述正在發生的事情，以推動這一重新加速？我知道比較變得越來越容易，但我們聽到了太多關於 WATERPIK 和 FLAWLESS 的信息，有時卻沒有聽到這裡有機銷售的其他潛在驅動因素。事實上，我只是想了解今年下半年該個人護理產品組合的全面交付情況，特別是當 HERO 進入基地時？

Okay. I'll start. This is Matt, Chris and Rick can pile on. So I mentioned WATERPIK and vitamins, so we said on a full year basis that they would be flattish in net sales. So first half, they're both down year-over-year. The expectation is up in the second half. So you're right about that. They're going to start contributing to the inflection of Personal Care starting to grow. In international, we have BATISTE and STERIMAR where we've been somewhat capacity constrained. And that's abating right now, too. So that's going to help us on the international side. And BATISTE continues to grow in the U.S. We continue to be able to expand, as I mentioned in my remarks, awareness and also household penetration. THERABREATH is a juggernaut and when we bought that business, probably had around $100 million in sales. Our ambition long term is for that to be a $0.5 billion business globally. So that's going to continue to grow. We've got lots of distribution gains already this year and more ahead of us. And the same is true for HERO. Here we just bought last October, we got a fantastic team driving that business. They, by and large, have all stuck around with us and we want them to stay for a long time because we have so much success and so much runway ahead of us. So to give you a little sense for half a dozen brands here that are contributing to the growth.

好的。我開始吧。這是馬特、克里斯和瑞克可以繼續努力的。所以我提到了 WATERPIK 和維生素，所以我們說全年淨銷售額將持平。所以上半年，它們都同比下降。下半年的預期有所上升。所以你是對的。他們將開始為個人護理的發展做出貢獻。在國際上，我們有 BATITE 和 STERIMAR，但我們的產能有些受到限制。現在這種情況也在減弱。所以這將對我們在國際方面有所幫助。 BATIST 在美國繼續增長。正如我在發言中提到的那樣，我們繼續能夠擴大知名度和家庭滲透率。 THERABREATH 是一家巨頭，當我們收購該業務時，其銷售額可能約為 1 億美元。我們的長期目標是使其成為全球價值 5 億美元的業務。所以這將繼續增長。今年我們已經獲得了很多分銷收益，而且未來還會有更多收益。 HERO 也是如此。我們去年十月剛剛買下了這裡，我們有一支出色的團隊來推動這項業務。總的來說，他們都一直陪伴在我們身邊，我們希望他們能長期留在我們身邊，因為我們已經取得了巨大的成功，前面還有很長的路要走。因此，讓您對這里為增長做出貢獻的六個品牌有一點了解。

Yes. And I'll try to just add, Chris, it's Rick, that Matt's exactly right. BATISTE, THERABREATH, all those things are happening. You're right. Your math is correct. Q1 organically for Personal Care was negative. Q2 was positive. We expect Q3, Q4 to be positive. So we do see the inflection point as well.

是的。我會嘗試補充一下，克里斯，我是里克，馬特是完全正確的。巴蒂斯特、THERABREATH，所有這些事情都在發生。你說得對。你的數學是正確的。個人護理品第一季度的有機增長率為負。第二季度是積極的。我們預計第三季度、第四季度將是積極的。所以我們也確實看到了拐點。

And good news there, that's a high-margin part of the business, it's Personal Care.

好消息是，個人護理是該業務的高利潤部分。

Okay. Yes. And that's just one thing I wanted to confirm that mix should become a bit more of a tailwind for gross margins in the back half as well. So I think you just need to care of that. One other that I'll get back in, we saw some incremental pricing in the Nielsen data around laundry. Just wanted to confirm that, if that's true or not, (inaudible) way if there was pricing taken in the business, and then maybe just contextualize if that was the case, why it happened and how you're thinking about kind of maintaining value and volume share in the laundry business in the U.S. going forward.

好的。是的。這只是我想確認的一件事，混合也應該成為後半段毛利率的更多推動力。所以我認為你只需要關心這一點。我會再講的另一件事是，我們在尼爾森的洗衣數據數據中看到了一些增量定價。只是想確認一下，無論這是真的還是假的，（聽不清）業務中是否進行了定價，然後也許只是結合上下文，如果是這種情況，為什麼會發生這種情況以及您如何考慮維持價值以及未來美國洗衣業的銷量份額。

Yes. We haven't taken any incremental pricing on laundry. I mean, there's still the impact of concentration, as an example, but that's not really pricing. So we have not taken any incremental pricing.

是的。我們沒有對洗衣採取任何增量定價。我的意思是，舉例來說，仍然存在集中度的影響，但這並不是真正的定價。所以我們沒有採取任何增量定價。

Yes. And Chris, the only area where we have announced an increase in price to retailers is in baking soda for the obvious reasons with the 50% increase in soda ash that Rick made reference to.

是的。 Chris，我們向零售商宣布提價的唯一領域是小蘇打，原因很明顯，Rick 提到的純鹼價格上漲了 50%。

Your next question comes from Rupesh Parikh from Oppenheimer.

您的下一個問題來自奧本海默的魯佩什·帕里克（Rupesh Parikh）。

Also congrats on a really nice quarter. So just going back to your commentary on the U.S. consumer business, where I think you gained -- gain to maintain share in 6 out of your 14 power brands category. How are you thinking about this for the balance of the year? Do you expect that metric to improve as we get to Q3 and Q4, especially as maybe some of your advertising picks up?

還要祝賀這個季度非常美好。回到您對美國消費者業務的評論，我認為您在這方面獲得了收益——在您的 14 個強勢品牌類別中維持了 6 個品牌的份額。您如何看待今年剩下的時間？您預計隨著第三季度和第四季度的到來，這一指標會有所改善，特別是您的一些廣告可能會有所增加嗎？

Rupesh, we do think we're going to improve that as we go through the year as our market investments behind it -- as our fill levels comp year-over-year are comparable. But I think even a better metric is instead of 6 of 14, we've been talking about 65% of our net sales have gained share. So that's -- our large brands are winning.

Rupesh，我們確實認為我們將在這一年中改進這一點，因為我們背後的市場投資 - 因為我們的填充水平與去年同期相比是可比的。但我認為更好的指標不是 14 中的 6，而是我們一直在談論的淨銷售額的 65% 已經獲得了份額。所以，我們的大品牌正在獲勝。

Yes. Rupesh, some of the categories in Personal Care that are down like battery, pregnancy test kits, cold shortening. These are small categories, but they count as 1 of the 14. So we're trying to get to focus more on the big brands and how they're performing.

是的。 Rupesh，個人護理品類中的一些類別下降了，例如電池、妊娠測試套件、冷起酥油。這些都是小類別，但它們算作 14 個類別中的其中之一。因此，我們正努力更多地關注大品牌及其表現。

Okay. Great. And then given we've seen margin to prove not only for you guys, but also other players out there, just curious what you're seeing the competitive promotional backdrop right now? And then just how you think about the promotional environment for the balance of the year?

好的。偉大的。然後，鑑於我們已經看到了不僅可以向你們證明的餘地，而且還可以向其他玩家證明，只是好奇您現在看到的競爭性促銷背景是什麼？那麼您如何看待今年剩餘時間的促銷環境？

Yes. Well, look, as far as promotions go, generally, the conversation goes around household. So if you look at the laundry category in total, it's -- sequentially, it's up about 80, 90 bps from Q1 to Q2. And if you look at liquid laundry detergent, that's up a couple of hundred basis points and sold on deal from Q1 to Q2. On the other hand, if you look at unit dose sequentially, it's down 340 basis points from Q1 to Q2. So all in, I'd say, if you look at the laundry category in total, it's not significantly more promotional in Q2 than Q1. And then if you look at laundry -- pardon me, at Litter sold on deal just the last few quarters, it's been pretty steady. It's been around 15% sold on deal.

是的。嗯，看，就促銷而言，一般來說，談話都是圍繞著家庭進行的。因此，如果你看一下洗衣類別的總體情況，就會發現，從第一季度到第二季度，該類別增長了約 80、90 個基點。如果你看看液體洗衣粉，你會發現從第一季度到第二季度，液體洗衣粉的銷量上漲了幾百個基點。另一方面，如果按順序查看單位劑量，會發現從第一季度到第二季度下降了 340 個基點。總而言之，我想說，如果你從總體上看洗衣類別，你會發現第二季度的促銷活動並不比第一季度明顯更多。然後，如果你看看洗衣店——請原諒我，在過去幾個季度的 Litter 促銷中，它一直相當穩定。成交價約為 15%。

So I would -- and then the last one would be a vitamin business, VMS that actually is less promotional in Q2 than in Q1. So I would say that from where we sit when we look at our most promotional categories, we think that things are pretty steady.

所以我會 - 最後一個是維生素業務，VMS 實際上在第二季度的促銷力度比第一季度要少。所以我想說，從我們所處的位置來看，當我們查看最促銷的類別時，我們認為情況相當穩定。

Your next question comes from Peter Grom from UBS.

您的下一個問題來自瑞銀集團的彼得·格羅姆。

This is Bryan Adams on for Peter. So just looking at the implied -- I think you said up to the back half that implies around up to 2.2% or a little over 2% growth in volume in the second half, should we be thinking about that as a sequential build? Or is it more just looking at the year ago comparisons with how challenging 3Q was? Is it reasonable to expect that 3Q volumes might be on par or even above that of 4Q?

我是布萊恩·亞當斯 (Bryan Adams) 替彼得發言。因此，只要看看隱含的內容——我認為您所說的下半年的銷量增長大約為 2.2% 或略高於 2%，我們是否應該將其視為一個連續的增長？還是只是將去年的情況與第三季度的挑戰性進行比較？預期第三季度銷量可能與第四季度持平甚至高於第四季度是否合理？

Yes. Bryan, we've kind of said about up to 50% in the second half is going to be volume driven. We think that is impactful, it inflects positively. I think because of the comp, maybe Q3 is a little bit better than Q4.

是的。 Bryan，我們說過下半年高達 50% 的份額將由銷量驅動。我們認為這是有影響力的，它會產生積極的影響。我認為由於比較，也許Q3比Q4好一點。

Okay. Great. And then just one more quick one on Specialty Products. I think entering the quarter, the expectation was for that business to be slightly negative this year and you've had another choppy quarter here. I know you called out the reasons why with the lower price import. I (inaudible) far from an expert on the puts and takes of the business here. But just looking ahead, should we expect kind of a similarly challenged backdrop as we head into the second half? Are you expecting any improvement here?

好的。偉大的。然後是關於特色產品的快速介紹。我認為進入本季度，預計今年該業務將略有下滑，並且您又經歷了一個動蕩的季度。我知道您說出了進口價格較低的原因。我（聽不清）遠不是這裡業務的專家。但展望未來，當我們進入下半年時，我們是否應該期待類似的挑戰背景？您期待這裡有任何改進嗎？

Yes. I'll give you the division kind of organic outlook here we are in July. So approximately 5% for domestic, 6% to 7% for international and negative for SPD, and that gets us to approximately 5%. So we continue to think we'll have the same issue that we experienced in Q2 for the balance of the year.

是的。我將為您提供 7 月份的部門有機展望。因此，國內約為 5%，國際約為 6% 至 7%，SPD 為負，這樣我們就達到了約 5%。因此，我們仍然認為今年剩餘時間我們將遇到第二季度遇到的同樣問題。

Your next question comes from Lauren Lieberman from Barclays.

您的下一個問題來自巴克萊銀行的勞倫·利伯曼。

I just want to maybe try to ask a bit of a longer-term question, which is that now it feels you've got really good visibility into gross margin recovery to pre-COVID levels through the worst in terms of kind of the discretionary driven volatility on top line. And with all of that, reinvest and set up to get back to not quite 12%, but a huge step change this year. Now that things are kind of more settled, if you will, you also talked about some incremental investments in efficiency. And so I was wondering if we could just hear a little bit about kind of longer range planning as you think about investments in capabilities, in supply chain, which I know we've talked about in pieces, but you kind of think over a multiyear view, perhaps, how you think about investments that you may want to be making more kind of infrastructure to support the business with the hindsight being 2020 of some of the operational headwinds that you ultimately face during the global pandemic that nobody could have planned for.

我只是想嘗試問一個更長期的問題，那就是，現在感覺你已經非常清楚地看到毛利率在最糟糕的情況下恢復到新冠疫情前的水平，從可自由支配的角度來看頂線的波動性。考慮到所有這些，再投資和設置將回到不到 12%，但今年是一個巨大的變化。現在事情已經比較穩定了，如果您願意的話，您還談到了一些提高效率的增量投資。因此，我想知道當您考慮對能力和供應鏈的投資時，我們是否可以聽到一些有關長期規劃的信息，我知道我們已經多次討論過這些問題，但您會考慮多年或許，您如何看待您可能希望進行更多類型的基礎設施來支持業務的投資，事後看來，2020 年您最終會在全球大流行期間面臨一些運營逆風，而這是任何人都無法預料到的。

Yes, it's a good question. You've heard us say in the past that we think that sales per employee is an underappreciated measurement of a company's performance, but we focus on that quite a bit. And Rick kind of chime in with some details. But we look at how do we make our people in the plants more efficient through automation and how do we do the same with respect to the white collar office workers. We have -- we're going to be close to $6 billion in sales next year. We have around 5,200, 5,300 employees. And the goal here is can you continue to grow your top line without necessarily growing the number of plants that you have or the number of employees that you have to make the team far more efficient. But we can give you a couple of examples of RPA and the number of projects we've done in the past, how many we plan to do this year and in the future as an example of how you try to make certainly, your office workers more productive. And of course, we, like so many other companies out there are now looking to AI and Chat and say, well, how can we leverage that to make everybody more productive. But Rick, you can throw a few examples on the table.

是的，這是一個好問題。您過去曾聽我們說過，我們認為員工人均銷售額是衡量公司業績的一個未被充分重視的指標，但我們非常關注這一點。里克也插話了一些細節。但我們著眼於如何通過自動化提高工廠員工的效率，以及如何對白領辦公室職員做同樣的事情。我們明年的銷售額將接近 60 億美元。我們約有 5,200 名、5,300 名員工。這裡的目標是，您是否可以繼續增加收入，而不必增加您擁有的工廠數量或您必須增加的員工數量，從而使團隊效率更高。但我們可以為您提供幾個 RPA 示例以及我們過去完成的項目數量、我們計劃今年和未來完成的項目數量，作為您如何努力讓您的辦公室工作人員確信無疑的示例更有成效。當然，我們和許多其他公司一樣，現在正在尋求人工智能和聊天，並說，我們如何利用它來提高每個人的工作效率。但是里克，你可以舉幾個例子。

Yes. So it's all in the backdrop of making sure that our Evergreen model of 25 basis points of SG&A leverage each and every year is solid for the next 5, 10 years. And so 2 examples, one Matt mentioned is like RPA. So one of the investments we're making right now with automation and technology is we have 20 or 30 projects that represent thousands and thousands of hours that we're automating and that way that our people have more capacity to do other work, which is really impactful as we build the company and we have more and more brands every day.

是的。因此，這一切都是為了確保我們每年 25 個基點的 SG&A 槓桿槓桿在未來 5 年、10 年保持穩定。 Matt 提到的兩個例子就像 RPA。因此，我們現在在自動化和技術方面進行的投資之一是我們有 20 或 30 個項目，這些項目代表了我們自動化的數千小時，這樣我們的員工就有更多的能力去做其他工作，即隨著我們建立公司，我們每天都有越來越多的品牌，這確實具有影響力。

The second one we're doing is we're making significant technology investments. I think you've heard us talk about before, but we put an ERP system into China as an example. We're investing into an ERP system for our GMG business, which is our fastest-growing international business. So we're putting technology. We're putting -- enabling technology so that we can scale and grow. We have SG&A investments for people and regulatory and R&D so that, that business can continue to grow at the rate that it's been growing at.

我們正在做的第二件事是我們正在進行重大的技術投資。我想你以前聽過我們談論過，但我們以ERP系統進入中國為例。我們正在為 GMG 業務投資 ERP 系統，這是我們增長最快的國際業務。所以我們正在投入技術。我們正在投入支持技術，以便我們能夠擴展和發展。我們對人員、監管和研發進行SG&A 投資，以便該業務能夠繼續以其一直在增長的速度增長。

Your next question comes from Dara Mohsenian from Morgan Stanley.

您的下一個問題來自摩根士丹利的 Dara Mohsenian。

So just along the vein of the last question, clearly, a lot of reinvestment in the back half of the year relative to original plan. Can you just talk about the level of payback you expect from those investment areas as well as the timing of payback? Obviously, marketing is a line item that's highly visible to us. But it seems like there are a bunch of other areas in terms of higher R&D, greater registrations, technology. You just mentioned Europe and China, Rick. So those are more nebulous and harder to judge. So just how do you think about the payback and are you basically pulling forward some incremental investment that would have occurred in '24 as we think about this reinvestment in the back half of the year?

因此，沿著最後一個問題的脈絡，顯然，相對於原計劃，今年下半年有大量再投資。您能談談您對這些投資領域的預期回報水平以及回報時間嗎？顯然，營銷是我們高度關注的一個項目。但在更高的研發、更大的註冊和技術方面似乎還有很多其他領域。你剛才提到了歐洲和中國，里克。所以這些更加模糊，更難判斷。那麼，您如何看待投資回報？當我們考慮今年下半年的再投資時，您是否基本上會推進一些本應在 24 年發生的增量投資？

Yes. So in terms of payback, we'll start with marketing. Marketing, we're spending $30 million more, where we're spending that incremental marketing, while it's around brands like THERABREATH, like HERO, the ARM & HAMMER campaign, Give it The Hammer, which has been great in the recessionary time. So all those things are driving the top line. We're seeing an immediate payback, right? We talked about distribution gains for THERABREATH and HERO.

是的。因此，就回報而言，我們將從營銷開始。營銷方面，我們多花了 3000 萬美元，進行增量營銷，圍繞 THERABREATH、HERO、ARM & HAMMER 活動、Give it The Hammer 等品牌進行營銷，這些品牌在經濟衰退時期表現出色。因此，所有這些因素都在推動營收增長。我們看到了立竿見影的回報，對嗎？我們討論了 THERABREATH 和 HERO 的發行收益。

Sometimes these are the first national campaigns they've ever experienced and consumption is on fire, and that's as a result of marketing and distribution gains. So the payback there is rapid. On the SG&A, 2/3 of that SG&A number is incentive comp year-over-year as our results are outperforming, then maybe 1/3 is the investments. And those investments were more onetime in nature. And yes, for registrations, we've pulled forward a couple of years of registrations. We may do that again in terms of -- it gets us ready to grow even faster, and it gives you more optionality to expand in different countries around the world. Anything, Matt, you would add?

有時，這是他們經歷過的第一次全國性活動，消費火爆，這是營銷和分銷收益的結果。所以回報很快。在 SG&A 方面，SG&A 數字的 2/3 是同比激勵補償，因為我們的業績表現出色，那麼可能 1/3 是投資。這些投資本質上更多是一次性的。是的，對於註冊，我們已經提前了幾年的註冊。我們可能會再次這樣做，因為它讓我們準備好更快地發展，並且為您提供了在世界各地不同國家擴張的更多選擇。馬特，你還有什麼要補充的嗎？

Yes. I just say, Dara, we're very consistent. We've got a long-standing practice that when the business is performing well, we look at that as an opportunity to reinvest. So things -- initiatives you might have had next year or the year after, we're going to say, "Hey, we could fund it now, let's do it." And with respect to marketing, it's really a no-brainer as marketing correlates with the health of brands and the strength of our brand equity. And you can't live at 10% of sales. And there's another example of something we were going to ramp up in '24. We got ahead of it now, so that is not going to be a drag year-over-year in '24 versus '23, that ramp up to 11%. So these are all good things.

是的。我只是說，達拉，我們非常一致。我們長期以來的做法是，當業務表現良好時，我們將其視為再投資的機會。所以，對於你明年或後年可能採取的舉措，我們會說，“嘿，我們現在就可以資助它，讓我們開始吧。”就營銷而言，這確實是理所當然的，因為營銷與品牌的健康狀況和我們品牌資產的實力相關。而且你不能靠銷售額的 10% 過活。還有另一個例子，說明我們將在 24 年加大力度。我們現在已經領先了，因此 24 年與 23 年相比，這不會成為同比拖累，增幅高達 11%。所以這些都是好事。

Your next question comes from Andrea Teixeira from JPMorgan.

您的下一個問題來自摩根大通的 Andrea Teixeira。

I wanted to ask more about your point on volumes for the more discretionary categories, not to take away from, obviously, the improvement in any other areas and the down trade that you benefit, but some of these categories, of course, the 20%, I believe, is still around what they represent in your revenues. So I understand that you're comping very easy comparisons, but consumption-wise, I wonder why consumers will go back to FLAWLESS and WATERPIK given the headwinds in the category. And in general, I think we've heard all companies talk about like, well, we will see volumes rebounding. It is not like your volumes were relatively outperforming. So I wonder ex those 2 of those 3 categories, including VMS, so what makes you comfortable with the rebounding volumes that is predicated in your guidance?

我想更多地詢問您對更多可自由支配類別的交易量的看法，顯然，不是為了排除您受益的任何其他領域的改善和下降交易，但其中一些類別，當然，20%我相信，仍然圍繞著它們在您的收入中所代表的內容。所以我知道你正在進行非常簡單的比較，但從消費角度來看，我想知道為什麼消費者會回到 FLAWLESS 和 WATERPIK 考慮到該類別的逆風。總的來說，我認為我們聽到所有公司都在談論，我們將看到銷量反彈。並不是說你們的銷量表現相對優異。所以我想知道這 3 個類別中的 2 個類別（包括 VMS）是什麼讓您對指導中預測的反彈量感到滿意？

Yes. Well, I'll start with FLAWLESS. We haven't said a word about FLAWLESS nor will we. It's a small brand for us now. For as WATERPIK, just remember, when we entered the year, if you go back 6 months, we said, "Hey, the first 6 months were going to be choppy here. We had inventory in the channel that we had to work through. We had an imbalance out there." That's behind us now. So that obviously has a direct impact on our sales in the second half. And same with vitamins. We -- that was our biggest problem child when it came to supply in 2022, we got punished for that by suppliers where we lost displays.

是的。好吧，我將從“完美”開始。我們沒有說過任何關於“FLAWLESS”的字，我們也不會。現在對我們來說這是一個小品牌。對於 WATERPIK，請記住，當我們進入這一年時，如果你回到 6 個月，我們會說，“嘿，前 6 個月會很不穩定。我們必須處理渠道中的庫存。我們那裡存在不平衡。”現在已經在我們身後了。因此，這顯然對我們下半年的銷售產生了直接影響。維生素也一樣。我們——這是我們在 2022 年供應方面遇到的最大問題，我們因此受到了供應商的懲罰，因為我們失去了顯示器。

In some cases, we lost distribution. So consequently, on it, we've took that on the chin in the first half, but that's starting to improve in the second half as far as the number of displays we're able to get in. And some of the variants that we weren't able to make last year that we're going to start introducing back in example, a magnesium gummy, for example. So for those 2 businesses, we would say, "Hey, there's reasons to believe that they're going to start inflecting in the second half."

在某些情況下，我們失去了分銷。因此，在這一點上，我們在上半場就已經解決了這個問題，但在下半年，就我們能夠進入的顯示器數量而言，情況開始有所改善。去年我們沒能開始推出鎂軟糖等產品。因此，對於這兩家企業，我們會說，“嘿，有理由相信它們將在下半年開始出現變化。”

Yes. And so I'll just give you a couple of comments to Andrea. In the back half of 2022, those businesses were down. So we expect those businesses to be really like, Matt said earlier, a little -- a couple of them a little positive in the back half and really flat for the year. But when you add up all those 3 businesses and the impact they've had in the company, I've quoted it a couple of times. But in Q4, it was a 4% drag. In Q1, they were a 3% drag. In Q2, they were only a 1% drag, and we expect them to be flat in the second half. So it's already improved, I guess, what we're saying.

是的。所以我只想向安德里亞提幾點意見。 2022 年下半年，這些業務出現下滑。因此，我們預計這些業務確實會像馬特早些時候所說的那樣，其中一些業務在下半年會有點積極，但今年會表現平平。但當你把這三項業務以及它們對公司的影響加起來時，我已經引用過幾次了。但在第四季度，這一數字下降了 4%。第一季度，它們拖累了 3%。在第二季度，它們僅造成了 1% 的拖累，我們預計下半年將持平。所以我想，我們所說的已經得到了改善。

Your next question comes from Steve Powers from Deutsche Bank.

您的下一個問題來自德意志銀行的史蒂夫·鮑爾斯。

On VITAFUSION, just maybe a little bit more detail on your visibility into stabilization and kind of winning back those retailers and consumers, just kind of where you are in the process and how long you think it will take?

在 VITAFUSION 上，也許可以更詳細地介紹一下您對穩定性的了解以及贏回那些零售商和消費者的情況，以及您在此過程中所處的位置以及您認為需要多長時間？

Well, a lot of work has been gotten into this business. I know we're looking at our packaging, our graphics, our messaging. The black eye we got last year gave us a chance to stand down and take a hard look at the brand and look ahead. I think over the next 12 months, you're going to start seeing some changes on shelf and how we go to market. I wouldn't disclose any more than that right now. Anything to add, Rick?

嗯，這項業務已經做了很多工作。我知道我們正在關注我們的包裝、我們的圖形和我們的信息。去年的黑眼圈讓我們有機會停下來認真審視這個品牌並展望未來。我認為在接下來的 12 個月裡，您將開始看到貨架上以及我們進入市場的方式發生一些變化。我現在不會透露更多信息。有什麼要補充的嗎，瑞克？

Yes. I mean for vitamins, I think it's -- when we have our TDPs get impacted a little bit because we're in the penalty box for supply, we got to do what Matt alluded to, we're going to -- we've gotten more displays. We're adding advertising. We're looking at our messaging and then it takes 9 months or so to make that case for the retailers so you can get the distribution back into a leading position.

是的。我的意思是，對於維生素，我認為，當我們的 TDP 受到一點影響時，因為我們處於供應的懲罰範圍內，我們必須做馬特提到的事情，我們將 - 我們已經獲得了更多的展示。我們正在添加廣告。我們正在研究我們的信息，然後需要大約 9 個月的時間向零售商說明情況，以便您可以使分銷重新回到領先地位。

I guess just going back to maybe kind of the question on there is and that Lauren brought up on the reinvestment rates. I think the reinvestments you're doing now were very well telegraphed. And as you've articulated, necessary for lots of reasons. But I guess the idea, Matt, as you outlined that the history of the business has been when things are good, you reinvest to kind of get ahead. I guess there's (inaudible) like there's a little bit of tension between that dynamic. And then the other side of it trying to catch up from sort of a last year in '22. So as you go forward, do you -- is the philosophy to run the business as you have from here forward, which effectively means we're kind of getting back to more of an Evergreen mentality off of this newly established base or is there more of a desire at some point to recruit some of these upfront investments and kind of return to trend off of maybe a '21 basis? Like how do you think about that from, just how you're managing the business from here?

我想只是回到勞倫提出的再投資率的問題。我認為你們現在正在進行的再投資已經得到了很好的傳達。正如您所闡述的，出於多種原因，這是必要的。但我猜想這個想法，馬特，正如你所概述的那樣，企業的歷史是，當情況良好時，你會進行再投資以取得成功。我猜想（聽不清）這種動態之間存在著一點緊張關係。另一方面，它試圖追趕去年 22 年的情況。因此，當你繼續前進時，你會——這是你從現在開始經營業務的理念，這實際上意味著我們在這個新建立的基地上回歸了更多的常青心態，或者還有更多是否希望在某個時候招募一些前期投資，並在 21 世紀的基礎上回歸趨勢？就像您如何看待這個問題，您如何在這裡管理業務？

Yes. Well, look, we -- I've been here for a long time since 2006, and we've had -- we've lived with our Evergreen model for many, many years and it served us well. And last year was an anomaly for us. And we said, okay, we got to get back to our algorithm. And we said we had a big step up in 2023. And by virtue of what we've shown in the first half, we're going to get to 6% EPS growth in 2023. We're going to get marketing back up to 11% of sales, which is how we want to run the railroad. And we sold 200 basis points light versus what our gross margins were pre-COVID. So when we get to the end of '23, that's ahead of us. So it's going to take us a few years to get back there. But as we improve our gross margin in '24 and '25, that's obviously going to throw off a fair amount of profit.

是的。好吧，看，我們——自 2006 年以來我已經在這裡很長時間了，我們已經——我們已經使用長青模式很多很多年了，它對我們很有幫助。去年對我們來說是不尋常的一年。我們說，好吧，我們必須回到我們的算法上來。我們說我們在 2023 年取得了很大的進步。憑藉我們上半年所表現的情況，我們將在 2023 年實現 6% 的每股收益增長。我們將讓營銷恢復到銷售額的 11%，這就是我們希望運營鐵路的方式。與新冠疫情爆發前相比，我們的毛利率低了 200 個基點。所以當我們到 23 年底時，這一切就在我們前面了。所以我們需要幾年的時間才能回到那裡。但隨著我們在 24 年和 25 年提高毛利率，這顯然會損失相當多的利潤。

So if you look at just the first half of this year, we had double-digit gross profit growth. That's a great trend. So I'd say that the short story is the success we've had in the first 6 months, the strength we see in the second half, certainly on sales and gross profit growth gives us greater confidence so we can return to our normal Evergreen model algorithm in 2024, but we're not -- it's too early to be calling numbers at this point. But I think going to 11% of marketing as a percentage of sales this year is a big deal. It won't be a headwind in next year '24 versus '23. And we still have the ambition to grow gross margin significantly in the next couple of years. So that's a short story about how we think about the P&L, Steve.

因此，如果你看看今年上半年，我們的毛利潤增長了兩位數。這是一個很好的趨勢。所以我想說，簡短的故事是我們在前 6 個月取得的成功，我們在下半年看到的實力，當然是銷售和毛利潤的增長給了我們更大的信心，這樣我們就可以恢復正常的常青樹模型算法將在 2024 年推出，但我們還沒有——現在宣布數字還為時過早。但我認為今年營銷佔銷售額的比例達到 11% 是一件大事。明年的 24 年與 23 年相比，這不會是一個逆風。我們仍然有志在未來幾年大幅提高毛利率。這是一個關於我們如何看待損益表的小故事，史蒂夫。

Your next question comes from Anna Lizzul from Bank of America.

您的下一個問題來自美國銀行的 Anna Lizzul。

I was wondering on the distribution gains with HERO and THERABREATH. Could you comment on where you're seeing the largest gains in distribution with your various retail partners? And are there any challenges to gaining distribution? Also, to what extent do you think you have more runway on distribution? And do you have any concerns from some of the larger brands that have been innovating in this space with similar offerings that might have distribution already well established.

我想知道 HERO 和 THERABREATH 的發行收益。您能否評論一下您在與各個零售合作夥伴的分銷中看到的最大收益在哪裡？獲得分銷有什麼挑戰嗎？另外，您認為在發行方面您有更多的跑道嗎？您是否對一些較大品牌有任何擔憂，這些品牌一直在這個領域進行創新，提供類似的產品，而這些產品可能已經建立了良好的分銷網絡。

As I go through, you're going to have to remind me about the question 3 and 4. But as far as where the distribution is coming from, if you take HERO, so HERO was built through Amazon, Target and Ulta. And those were the mainstay retailers that the HERO team chose to grow the brand. So consequently, every other retailer in class of trade is an opportunity for us. And so we've -- that's what we've been pursuing.

當我講完時，你必須提醒我問題 3 和 4。但就分發的來源而言，如果你採用 HERO，那麼 HERO 是通過 Amazon、Target 和 Ulta 構建的。這些都是 HERO 團隊選擇發展品牌的主要零售商。因此，貿易類中的所有其他零售商對我們來說都是一個機會。所以我們——這就是我們一直在追求的目標。

We've been going after a mass, which would be companies like -- retailers like Walmart, the big drug chains, et cetera, and then food. So the opportunity is, a, would be distribution and b, would be facings. Now if you go to THERABREATH, THERABREATH was more developed as far as the -- throughout many classes of trade, but not with respect to facings and how many variants are shown. So there's 2 things happening with THERABREATH. One is, yes, we're getting more retailers, but we're spreading out when we're on shelf. And because of -- this is the -- actually the highest priced mouthwash, it's accounting for 50% of the category growth in mouthwash in Q2. The retailers see that. Their penny profit is high on THERABREATH mouthwash. So consequently, they're interested in helping us grow. So we can anticipate more facings in the future, particularly in 2024. So I think both of those brands have a big tailwind going.

我們一直在追求大眾，比如沃爾瑪等零售商、大型藥品連鎖店等等，然後是食品。所以機會是，a，將是分配，b，將是面。現在，如果你去 THERABREATH，你會發現 THERABREATH 在許多行業中都更加發達，但不是在外觀和顯示的變體方面。 THERABREATH 發生了兩件事。一是，是的，我們有更多的零售商，但當我們上架時，我們正在分散。因為，這實際上是價格最高的漱口水，它佔第二季度漱口水類別增長的 50%。零售商看到了這一點。 THERABREATH 漱口水的利潤很高。因此，他們有興趣幫助我們成長。因此，我們可以預見未來會出現更多的情況，特別是在 2024 年。所以我認為這兩個品牌都有很大的發展空間。

And I would just add, Anna, that both of those brands have a lot of runway left on TDPs. Even if you look at there, for example, it's maybe third or fourth in the segment on TDPs and the next step change maybe is another competitor that has 1,100. So there's still room to run.

安娜，我想補充一點，這兩個品牌在 TDP 上都有很大的發展空間。例如，即使你看一下那裡，它在 TDP 方面可能排名第三或第四，下一步的變化可能是另一個擁有 1,100 的競爭對手。所以還有奔跑的空間。

Yes. I mean the amount of the velocity and the sales that we have would suggest that we should have far more shelf space than we have today.

是的。我的意思是，我們的速度和銷量表明我們應該擁有比今天更多的貨架空間。

And just any concern, I guess, from some of the larger brands that have been innovating in this space with some similar offerings that already have been distribution well established. Just any concern from that.

我想，這正是來自一些較大品牌的擔憂，這些品牌一直在這個領域進行創新，推出了一些已經建立良好分銷渠道的類似產品。只是對此的任何擔憂。

Yes. Are you referring to the acne category?

是的。您指的是痤瘡類別嗎？

Yes, both in the acne category and in the mouthwash category.

是的，無論是在痤瘡類別還是在漱口水類別。

Well, look, we welcome competition. As far as patches go, the advantage MIGHTY PATCH has is, number one, it was first. And number two, it's (inaudible) more efficacious than other patches. So I think that is what's going to make the difference going forward. Yes, and as far as THERABREATH goes, THERABREATH's got a different formula than other mouthwashes, even in the mouthwashes and the nonalcohol. So no, I would say we feel advantaged with respect to our offering, not just our formulas, but also our packaging and our go-to-market strategy and our use of social media.

好吧，看，我們歡迎競爭。就補丁而言，MIGHTY PATCH 的優勢是，第一，它是第一。第二，它（聽不清）比其他補丁更有效。所以我認為這就是未來產生變化的原因。是的，就 THERABREATH 而言，THERABREATH 的配方與其他漱口水不同，甚至包括漱口水和非酒精成分。所以不，我想說，我們在我們的產品方面感到有優勢，不僅僅是我們的配方，還有我們的包裝、我們的上市策略以及我們對社交媒體的使用。

Your next question comes from Bill Chappell from Truist Securities.

您的下一個問題來自 Truist Securities 的 Bill Chappell。

Just a little bit more on sodium bicarbonate. Just I don't remember, maybe you said what the percentage that is in terms of cost of goods sold, but also because I always enjoy the discussion on Animal Husbandry. I thought the key part of the specialty ingredients business was feeding sodium bicarbonate to cows to produce more milk. So why would that business not be passing off pretty meaningful price increases as well in driving sales?

稍微多一點碳酸氫鈉。只是我不記得了，也許你說的是銷售成本的百分比是多少，但也因為我總是喜歡關於畜牧業的討論。我認為特種原料業務的關鍵部分是給奶牛餵食碳酸氫鈉以生產更多的牛奶。那麼，為什麼該企業不通過大幅提價來推動銷售呢？

Yes. Yes, sodium bicarbonate is not a big part of the animal business within SBD. As far as -- we got into the animal business about 50 years ago when we learned that we were selling super sacks and baking soda to big bakers and they were selling out the back door to some dairies and they were sort of used -- putting in the feed sort of like (inaudible) for cows. That then got us into other nutritional products, prebiotic, probiotics over time. So the story with respect to soda ash and sodium bicarbonate is largely on the consumer side of the business. Now, Specialty Products business, 2/3 is animal, 1/3 is bulk sodium bicarbonate. And there, you would see that we have been raising price, but this is just -- it's a $100 million business. So it's not a real needle mover for us, Bill, when we raised price in bulk sodium bicarbonate.

是的。是的，碳酸氫鈉並不是 SBD 動物業務的重要組成部分。就我們而言，大約 50 年前，我們進入了動物行業，當時我們得知我們正在向大型麵包師出售超級麻袋和小蘇打，而他們卻通過後門將其出售給一些乳品廠，而它們在某種程度上被利用了——在飼料中有點像（聽不清）奶牛。隨著時間的推移，這讓我們開始涉足其他營養產品、益生元、益生菌。因此，關於純鹼和碳酸氫鈉的故事主要是在消費者方面。現在，在特種產品業務中，2/3 是動物產品，1/3 是散裝碳酸氫鈉。在那裡，你會看到我們一直在提高價格，但這只是——這是一項價值 1 億美元的業務。因此，比爾，當我們提高散裝碳酸氫鈉的價格時，這對我們來說並不是真正的推動因素。

Got it. So it's not enough to drive sales.

知道了。所以這不足以推動銷售。

Yes. On the consumer side, it's a much bigger deal. We don't typically quote what percentage of our COGS is sodium carbonate or baking soda, but remember, we use baking soda in a lot of different products. It's in toothpaste, it's in underarm deodorant, it's in cat litter, laundry detergent. It's -- we use it quite a bit. So it does matter.

是的。在消費者方面，這是一件更重要的事情。我們通常不會引用碳酸鈉或小蘇打佔 COGS 的百分比，但請記住，我們在許多不同的產品中使用小蘇打。它存在於牙膏、腋下除臭劑、貓砂、洗衣粉中。我們經常使用它。所以這確實很重要。

Okay. And then second, and I might have missed it. I mean in terms of the strength of our results in the past couple of quarters, you had leaned on or not leaned on indicated that consumer trade down was driving it. I mean, is that still a big driver? I mean it seems like it's more just the strength of the brands and the categories or is it really you continue to see a nervous consumer?

好的。其次，我可能錯過了。我的意思是，就過去幾個季度我們業績的實力而言，您是否依賴或不依賴表明消費者貿易下降正在推動這一趨勢。我的意思是，這仍然是一個大驅動力嗎？我的意思是，這似乎更像是品牌和品類的實力，還是您真的繼續看到緊張的消費者？

Yes. Well, look, the we've had 4 quarters now, 4 or 5 quarters now of trade down. So a lot of that's happening mid-'22 and it's going to continue through mid-'23. So you would say now that you're sort of starting to lap the trade down, but the ARM & HAMMER brand continues to grow. And like I said, July is equally as strong as year-over-year as Q1 and Q2. In fact, as Rick has pointed out and we pointed out in the release, a lot of the year-over-year comparisons, not just for Church & Dwight, but most CPGs has been colored by price. And the expectation now is we're going to go positive in volume in Q3 and Q4. So we expect that the launch is going to be one of those participants for positive volume in Q3.

是的。好吧，看，我們已經經歷了 4 個季度、4 個或 5 個季度的交易下滑。因此，很多事情都發生在 22 年中期，並將持續到 23 年中期。因此，您現在可能會說，您已經開始放棄貿易，但 ARM & HAMMER 品牌仍在繼續增長。正如我所說，7 月份的同比表現與第一季度和第二季度一樣強勁。事實上，正如 Rick 和我們在新聞稿中指出的那樣，許多同比比較，不僅針對 Church & Dwight，而且大多數 CPG 都受到了價格的影響。現在的預期是我們將在第三季度和第四季度實現正銷量。因此，我們預計此次發布將成為第三季度銷量增長的參與者之一。

Your next question comes from Olivia Tong from Raymond James.

您的下一個問題來自 Raymond James 的 Olivia Tong。

First question is around marketing. If you could just elaborate in terms of how much of the marketing spend is going towards maybe some more value to your products, where you are seeing some of that trade-down benefit versus some of the higher-end, THERABREATH, HERO and Personal Care type products.

第一個問題是關於營銷的。如果您能詳細說明有多少營銷支出可能會為您的產品帶來更多價值，您會看到一些與一些高端產品、THERABREATH、HERO 和個人護理產品相比的折價收益型產品。

You heard Rick mention that HERO and THERABREATH by virtue being part of Church & Dwight, we certainly have the wherewithal to invest quite a bit on 2 brands that are growing significantly and have a lot of runway ahead of them. The other place destination would be, which I mentioned briefly in my opening remarks, and that's our master brand campaign, which is going to Give it the HAMMER. And Give it the HAMMER campaign is really resonating with consumers. And I'm just talking about your average consumer out there. And it's really resonating with them because it really halos to all of our different categories. And it's consistent, and we came up with this as we entered the year and we said, "Hey, we got all this trade down going on. ARM & HAMMER is the working men's brand. So let's get behind that, and let's come up with a campaign that's going to support that thesis." And it's working. That brand is really scoring super high, and we're continuing to get behind it. We're going to get behind it in the second half continually.

您聽到 Rick 提到 HERO 和 THERABREATH 是 Church & Dwight 的一部分，我們當然有足夠的資金對這兩個正在顯著增長且有很大發展前景的品牌進行大量投資。另一個目的地是，我在開場白中簡要提到過，那就是我們的主品牌活動，即“Give it the HAMMER”。 “Give it the HAMMER”活動確實引起了消費者的共鳴。我只是談論那裡的普通消費者。這確實引起了他們的共鳴，因為它確實給我們所有不同的類別帶來了光環。這是一致的，我們在進入這一年時就提出了這一點，我們說，“嘿，我們把所有這些交易都進行下去了。ARM & HAMMER 是工人的品牌。所以讓我們支持這一點，讓我們來吧開展一場支持這一論點的活動。”它正在發揮作用。該品牌的得分確實很高，我們將繼續支持它。我們將在下半場繼續落後。

Great. And then just following up, in terms of your expectations for volumes to turn positive in the second half and being up for the fiscal year, as you mentioned in your prepared remarks, can you talk about your view on price mix in the second half. And then maybe on price, what's already in place that hasn't lapped yet and whether you have incremental plans in the second half of the year?

偉大的。然後，正如您在準備好的發言中提到的那樣，就您對下半年銷量轉正以及本財年銷量增長的預期而言，您能否談談您對下半年價格組合的看法。然後也許在價格方面，哪些已經到位但尚未完成，以及下半年是否有增量計劃？

Yes. Olivia. So there's -- most of our pricing has lapped. A lot of our Laundry, Litter, OXICLEAN pricing happened in July a year ago. So most of the pricing has been lapped. There's a little bit still to come, that's why we're saying maybe 50-50 in the back half of the year. And then the only pricing action that we've talked about is baking soda, so that's only one left from a list price perspective. We always want to go optimize trade and revenue growth management. But with the [60%] increase and...

是的。奧利維亞。所以我們的大部分定價已經失效。我們的許多洗衣、垃圾、OXICLEAN 定價發生在一年前的 7 月。所以大部分定價已經被套用了。還有一些事情要做，這就是為什麼我們說下半年可能會達到 50-50。然後，我們討論的唯一定價行為是小蘇打，因此從標價的角度來看，這僅剩一個定價行為。我們始終希望優化貿易和收入增長管理。但隨著 [60%] 的增加......

And BATISTE would be the other one that we haven't completely lapped all the price increases. So that's going to be part of the story for price in the second half is (inaudible)

BATITE 將是我們尚未完全接受所有價格上漲的另一款產品。這將成為下半年價格故事的一部分（聽不清）

Your next question comes from Filippo Falorni from Citi.

您的下一個問題來自花旗銀行的 Filippo Falorni。

A question on private label. I know some of your largest categories don't have a lot of exposure. But maybe you can comment on private label performance in some of the categories that do have the exposure? And then, Matt, to your point on consumer trade down kind of starting to cycle that, what are you assuming in your second half guidance, you're assuming a continuation of this trend and acceleration of the trend towards trade down? Any color would be helpful.

關於自有品牌的問題。我知道你們的一些最大的類別沒有太多的曝光度。但也許您可以評論一些確實有曝光的類別中的自有品牌表現？然後，馬特，就您關於消費者貿易下降開始循環的觀點而言，您在下半年的指導中假設什麼，您假設這種趨勢會持續，並且貿易下降趨勢會加速？任何顏色都會有幫助。

Yes. Well, look, there's a half a dozen categories where we have private label competition. And I would say Litter is usually the one we've talked most about, but that's been stable for the last 3 quarters. It's around 13% Q4 -- Q1 and Q2. As far as trade down goes in household, it's a consumer is more likely to trade down. And we talked about trade down within laundry to ARM & HAMMER. We've had 4 quarters of that, as I just mentioned with the previous question. We do -- based on how July is setting up, it looks like that's continuing to happen. I do expect it's going to abate a little bit. One thing that's notable about trade down is, which I said in my opening remarks, is that XTRA, which is an extreme value detergent. It grew 7.5% consumption in Q2, and it actually gained share. And that was the first time in, I was like, 14 quarters that XTRA gained share. So that would suggest that there's trade down. Then Q2, remember, this is our most recent quarter, first time that's happened in 14 quarters. So you'd say, yes, there's still a tendency to trade down, particularly on the household side. When it comes to personal care, particularly health-related categories, far less likely to see trade down. So I think it's more of a household story.

是的。好吧，看，我們有六個類別有自有品牌競爭。我想說的是，垃圾通常是我們談論最多的一個，但在過去三個季度裡一直保持穩定。第四季度（第一季度和第二季度）約為 13%。就家庭中的降價消費而言，消費者更有可能進行降價消費。我們還討論了洗衣行業向 ARM & HAMMER 的換代。正如我剛剛在上一個問題中提到的那樣，我們已經經歷了四個季度。我們確實這麼做了——根據 7 月的情況，這種情況似乎還在繼續發生。我確實預計它會有所減弱。我在開場白中說過，關於折價交易值得注意的一件事是 XTRA，這是一種極有價值的清潔劑。第二季度消費量增長了 7.5%，市場份額實際上有所增加。我想，這是 XTRA 14 個季度以來第一次獲得市場份額。所以這表明貿易正在下降。然後是第二季度，請記住，這是我們最近的一個季度，也是 14 個季度以來第一次發生這種情況。所以你會說，是的，仍然存在降價購買的趨勢，尤其是在家庭方面。當談到個人護理，特別是與健康相關的類別時，貿易下降的可能性要小得多。所以我認為這更像是一個家庭故事。

Our last question for today comes from Javier Escalante from Evercore ISI.

我們今天的最後一個問題來自 Evercore ISI 的 Javier Escalante。

Another permutation on the spending and reinvestment and what to expect from it in the second half. It feels as if do you guys have built a financial benefit from that spending -- the higher advertising spending in the second half or not? It's just basically, you are assuming that you are just rebuilding a baseline of investment?

關於支出和再投資的另一種排列以及下半年的預期。感覺好像你們已經從這筆支出中獲得了經濟利益——下半年的廣告支出是否更高？基本上，您假設您只是在重建投資基線？

Well, look, some of it is -- it's hard to parse out, well, how much is restoring your typical spend that to maintain brand health and how much is actually going to change your top line. As Rick said, I think it's more likely that it's going to help THERABREATH and HERO in the second half. The other brands that are already doing extremely well, just pour some gasoline on those.

嗯，看，其中一些是 - 很難解析出，有多少是為了維持品牌健康而恢復的典型支出，以及有多少實際上會改變你的收入。正如Rick所說，我認為下半場更有可能幫助THERABREATH和HERO。其他已經做得非常好的品牌，只需在它們上面加點汽油即可。

Yes. And Javier, I would say it also positions us well as we enter 2024. So that should be taken into account as well.

是的。哈維爾，我想說，在我們進入 2024 年時，這也使我們處於有利的位置。所以也應該考慮到這一點。

And if things continue as well, say, right, that essentially gross margin ahead, top line ahead, that upside, do you rather say close the year with 12% advertising spending or you would rather balance that out and flow some of the upside to the bottom line?

如果情況繼續如此，比如說，毛利率基本領先，營收領先，這種上升趨勢，你是否願意說以 12% 的廣告支出結束這一年，或者你寧願平衡這一點並將部分上升空間流向底線？

Yes. Well, I mean, our outlook is what our outlook is. That's our best forecast of results. So right now, we're saying we're extremely happy that we got the 6% EPS growth while bringing marketing back up to 11%, which we thought was going to take 2 years. We're doing it all in 1 year and also making some investments for the future. So not really ready to talk about what we're going to do if we have upside to that.

是的。嗯，我的意思是，我們的觀點就是我們的觀點。這是我們對結果的最佳預測。所以現在，我們非常高興我們實現了 6% 的每股收益增長，同時將營銷增長率恢復到 11%，我們原以為這需要 2 年時間。我們將在一年內完成這一切，並為未來進行一些投資。因此，我們還沒有真正準備好談論如果我們有好處的話我們將做什麼。

But look at -- just to pile on gross margin expansion, gross profit growing. These are all great things and volumes inflecting some positive in the second half. There's a lot of barrels right now for the company.

但看看——只是為了增加毛利率的擴張、毛利潤的增長。這些都是偉大的事情和數量，在下半年產生了一些積極的影響。現在公司有很多桶。

I will now turn the call back over to Matt Farrell for closing remarks.

現在，我將把電話轉回給馬特·法雷爾（Matt Farrell），讓他發表結束語。

Yes. Thanks, everybody, for joining us today, and look forward to talking to you again at the end of the third quarter. Have a good one.

是的。感謝大家今天加入我們，並期待在第三季度末再次與您交談。祝你有個好的一天。

Ladies and gentlemen, this concludes your conference call for today. We thank you for joining, and you may now disconnect your lines.

女士們、先生們，今天的電話會議到此結束。我們感謝您的加入，您現在可以斷開線路了。