Anna Lizzul

Linda affirmed ongoing portfolio-review discipline but declined to signal specific trimming; nothing to comment on at the moment.

Linda: Innovation execution strong except Litter. PURE allergen above expectations on velocity and distribution. Scentiva Cherry Blossom #1 scent. Food launches starting well. Glad absorbent layer strong distribution. Litter behind, hard conversion friction but distribution gains achieved, adjustments underway. Private label flat, consumers still want brands. Brita watching carefully for PL pickup.

Linda: Q1 and Q2 categories about flat, expect 0-1% back half. January weather creating noise, don't project from short periods. IGNITE algorithm requires categories back to 2-2.5%, plus 1pt from Pro/International. GOJO accretive to growth and supportive of algorithm. Don't see normalized categories yet this year but investing to support return.

Linda said no material PL inroads in aggregate. Watching Brita carefully (consumers trading to PL filters and smaller sizes). Bleach also watching closely with some PL uptick. Wipes not a concern, Scentiva growing well. Adjusting plans to offer right value to lower-income consumers.

Linda said not seeing material destocking, ERP actually had opposite effect (rebuilding inventories). Retailers doing good structural work to reduce inventories but nothing impacting CLX results. Strong club positions across most businesses. Glad still working on club opportunities.

Linda said no material private label shift in aggregate. Glad exception driven by retailer assortment and channel mix. Wipes: Scentiva growing 4x rate of portfolio, not worried about PL. Watching closely and adjusting sizes to prevent forced trade-downs.

Linda said innovation and NRM are the drivers, not predicting consumer improvement. Using promotion strategically for life events and innovation introductions, not to subsidize category growth. Adjusting promotions to right sizes given consumer preference shifts.

Linda said aggregate promo normalized but Glad seeing deep discounting from competition including below private label pricing on larger sizes (not sustainable long-term). Premium innovation still resonating (Scentiva, ToiletWand, premium litter). Consumers willing to pay for superior value.

Linda described value-seeking behavior: consumers trading up to innovation on per-use basis, larger sizes for best cost-per-use, smaller for cash-constrained. Private label shares down. Grew share in 7/8 categories.

Linda said U.S. growth is volume-based with minimal pricing beyond net revenue management. Trade promo headwind concentrated in front half.

Rick said ARM & HAMMER held share despite competitors raising promotion sharply, with the value segment growing and each good-better-best tier doing well.

CEO very positive on current portfolio. Categories grew 3% this quarter. M&A team actively pursuing U.S. and international acquisitions. Touchland performing well in club channel and Amazon; beauty channels slower due to promotion timing.

CEO emphasized proactive strategy across all channels with right pack sizes and price points. On M&A: agnostic on category, focused on functional beauty/problem-solution brands. Not a beauty company.

CEO emphasized share gains across multiple brands (mouthwash, acne, Touchland) as growth driver beyond category recovery. Protecting 11% marketing spend and investing in back-half innovation.

CEO noted trade-down has not yet materialized - Orange Box not growing faster than Black Box on litter. Company well-positioned with good/better/best strategy when it does.

Urdaneta detailed: Q2 slightly below Q1 organic (strongest comp + $20M DC fire), H2 acceleration. Gross margin Q1 down 60bps largely from private label exit lapping. Full year gross and OP margins to expand 70-80bps.

Hsu detailed premium mix shift (40%→70% NA, 6%→40% China) while cascading innovation to value tiers. Torres noted IFP JV reducing fiber cost volatility through Suzano partnership.

Urdaneta confirmed advertising maintained at 6%, CapEx of $1B-$1.2B unchanged. No impact to long-term strategy. Hsu emphasized avoiding quality cuts or marketing reductions.

Hsu noted exits from Nigeria and Bolivia, optimization of Brazilian tissue. Professional globally positioned well with plans to improve North America washroom softness.

CEO confirmed continued investment increases with keen eye on ROI. In investment mode for skin health in 2025 with margin improvement expected as consumption grows and H1 headwinds dissipate.

CEO highlighted new Tate McRae campaign results and confirmed a revamped team, stronger innovation pipeline, and expansion of Neutrogena, Aveeno, OGX distribution.