Supplement sales helped drive gains in Clorox’s lifestyle segment in Q4
“In our lifestyle segment, Q4 sales increased 21%, reflecting gains from the Nutranext acquisition. And on a full year basis, sales increased 8%, largely reflecting the benefit of Nutranext,” reported Lisah Burhan, VP of investor relations for The Clorox Company during its Q4 earnings call this week.
Clorox’s lifestyle segment includes dressings and sauces (Hidden Valley), water filtration (Brita), natural personal care (Burt’s Bees), and dietary supplements, which includes probiotic brand Renew Life and the former Nutranext brands.
It acquired Nutranext in March this year for $700 million, which added the brands NeoCell, Rainbow Light, Sedona Labs, and Natural Vitality. The acquisition also diversified Clorox's reach in terms of channels, as some of the brands were direct-to-consumer and online exclusive.
For all segments, Clorox saw its Q4 sales grow by 3%, which, SVP and CFO Kevin Jacobsen attributed to “three points of benefit from Nutranext acquisition” during the call.
Gross margin decreased 170 basis points to 44% from 45.7% in last year’s Q4—this included 60 basis points of negative impact from costs related to the Nutranext acquisition.
CEO and chairman Benno Dorer said that he remains confident in the long-term outlook for the company’s health and wellness ventures.
“We continue to anticipate about three points of growth from the newest member of our portfolio, the Nutranext vitamins and dietary supplement business where integration is progressing in line with expectations,” he added.
“From a channel perspective, including Nutranext, e-commerce is now estimated at 6% of company sales and we anticipate growing strongly in this channel again in fiscal year 2019 to an estimated 8% of company sales.”
