By Linda Rendle, Chair and Chief Executive Officer
Our second-quarter results from fiscal year 2024, which we reported today, reflect strong progress on our recovery from the August cyberattack, continued advancement of our strategies to drive top-line growth and rebuild margin, and swift and effective management of currency headwinds in Argentina.
Net sales in the quarter increased 16% to $1.99 billion. We also expanded gross margin by 730 basis points to 43.5% due to the benefits of pricing and cost-savings initiatives, more than offsetting unfavorable foreign exchange rates. Gross margin also reflects the benefit of better cost absorption from strong shipment growth. This led to adjusted EPS growth of 120% to $2.16.
During the quarter, we restored the vast majority of retailer inventories ahead of our expectations, enabling us to minimize consumption losses, regain distribution and rebuild market shares. We’re now working on further restoring and improving distribution, getting back to full merchandising, and returning to normalized service levels. We have a proven track record of doing this, and I have no doubt we can do it again. While there is still more work to do to return our business to the trajectory it was on before the cyberattack, we’re on the right path to generate consistent, profitable growth over time.
Here are some additional highlights from the quarter:
- Maintained strong consumer value superiority results throughout our out-of-stock and recovery period. This speaks to the power of our advantaged portfolio as well as the superior value of our brands and their role in consumers’ daily lives.
- Delivered another strong quarter of cost savings as part of our ongoing effort to rebuild margin.
- Executed incremental pricing in Argentina to address significant currency headwinds, supporting our ability to deliver double-digit organic sales growth in International while maintaining strong market shares.
While we expect the operating environment to remain challenging as we look ahead, we’re committed to growing the top line and rebuilding margins, guided by our IGNITE strategy. The combination of our strong portfolio of trusted brands and ongoing investments in our brands, categories and capabilities position us well to make progress on these objectives. I’m confident that we’re taking the appropriate actions to build a stronger, more resilient company that is positioned to win in the marketplace and create value for our stakeholders.
I’d like to recognize my Clorox teammates for their resiliency and dedication and thank them for all they’ve done and continue to do for our company and our stakeholders. I also want to extend my gratitude to our consumers for their continued loyalty and to our customers for their tremendous patience and partnership.