DOW JONES NEWSWIRES
Clorox Co. (CLX) boosted its quarterly dividend 8.7% to 50 cents
a share in a move investors and analysts had been counting on,
while the company sees future margins rising more than expected on
cost savings.
Many consumer-products makers have been sweetening their
dividends during the recession and are expected to continue
boosting their payouts in coming months, a striking contrast with
the dividend cuts made by other industries.
Goldman Sachs analyst Andrew Sawyer said in April that Clorox's
hike could be in the double-digit range and might bring the payout
just above 50 cents. The company has raised its annual dividend for
the last 32 years.
Clorox follows in the footsteps of such consumer brand companies
such as Coca-Cola Co. (KO) and Kimberly-Clark Corp. (KMB), which
raised their dividends earlier this year.
But consumer-staples makers like Clorox haven't been immune to
the slide in spending. They have also been roiled by volatile
commodities prices for the past few years. Chairman and Chief
Executive Don Knauss said earlier this year that the company had
succeeded in imposing more price increases, despite pressure during
the recession for retailers and consumers to cut costs.
The company, which also backed its expectations for its
just-started fiscal year, anticipates margins rising as much as 1
percentage point a year the next four years, not the up to
0.75-point growth previously seen, on anticipated cost savings and
a moderating commodity environment.
Shares of Clorox, which made the announcements ahead of an
analyst conference, closed Wednesday at $53.49 and haven't traded
premarket. The stock is up 2.2% the past year, significantly
outperforming the broader market.
-By Kerry E. Grace, Dow Jones Newswires; 201-938-5089;
kerry.grace@dowjones.com