Good day, ladies and gentlemen and welcome to The Clorox Company First Quarter Fiscal Year 2021 Earnings Release Conference Call. At this time, all participants are in a listen-only mode. At the conclusion of our prepared remarks, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this call is being recorded. I would now like to introduce your host for today’s conference call, Ms. Lisah Burhan, Vice President of Investor Relations for The Clorox Company. Ms. Burhan, you may begin your conference.

Thank you, Sharon. Welcome, everyone and thank you for joining us. We certainly hope you and your family continue to remain safe and healthy in what remains a challenging environment. As usual, we have a few reminders before we go into results. We are broadcasting this call over the Internet and a replay of the call will be available for 7 days at our website, at cloroxcompany.com. Today’s discussion contains forward-looking statements, including statements related to the expected or potential impact of COVID-19. These statements are based on management’s current expectations, but may differ from actual results or outcomes. In addition, we may refer to certain non-GAAP financial measures. Please refer to the forward-looking statements section, which identifies various factors that could affect such forward-looking statements and the non-GAAP financial information section, which includes the table that reconciles non-GAAP financial measures to the most directly comparable GAAP measures, both of which are located at the end of today’s earnings release, which has also been posted on our website and filed with the SEC. Turning to today’s discussion of our results, I will start by covering our usual top line commentary with highlights in each of our segments. Kevin will then address our total company results, as well as our FY ‘21 outlook. Finally, Linda will offer her perspective and we’ll close with Q&A. For the total company, Q1 sales increased 27%, reflecting about a point of benefit from the acquisition of majority interest in our joint venture in the Kingdom of Saudi Arabia, and about a point of headwinds from unfavorable foreign exchange impact. This quarter’s 27% organic sales growth is supported by double digit sales growth in eight of our 10 businesses. I will now go through our results by segment. In our Health and Wellness segment, Q1 sales…

Thank you, Lisa and thank you everyone for joining us today. I sincerely hope you and your families are well. I am pleased with our very strong start to the fiscal year, reflecting broad-based strength across our portfolio, with double-digit volume, sales and profit growth in each of our reporting segments. Additionally, each reporting segment delivered gross margin expansion, contributing to our eighth consecutive quarter of gross margin expansion for the company. As you saw in our press release, we raised our fiscal year ‘21 outlook, given the strength of our Q1 results and our expectations for a higher top line growth over the balance of the fiscal year. Turning to our first quarter results, first quarter sales were up 27%, driven by 22 points of organic volume growth and 5 points of favorable price mix. Sales results also included one point of growth from acquiring majority control of our Saudi joint venture, offset by one point of FX headwinds. On an organic basis, sales grew 27%. Gross margin for the quarter increased 400 basis points to 48% compared to 44% in the year ago quarter. First quarter gross margin included the benefit of strong volume growth, as well as 170 basis points of cost savings and 150 basis points of favorable mix. These factors were partially offset by 300 basis points of higher manufacturing and logistics costs, which were similar to last quarter, included temporary COVID-19 spending. Selling and administrative expenses as a percentage of sales came in at 12% compared to 14% in the year ago quarter. Primarily from increased operating leverage. Advertising and sales promotion investment levels as a percentage of sales, came in at about 9%, equal to the year ago quarter. We’re spending for our U.S. retail business coming in at 11% of sales. Importantly,…

Thanks, Kevin. Hello everyone and thank you for being with us today. I hope you are well and in good spirits, as we continue to navigate this pandemic. It’s great to be joining you on my first call as CEO, especially after the tremendous first quarter we delivered. Our results show what Clorox does best. We serve people who count on our brands, especially during a time when they need to feel safe, and when their home is the center of their world. This reinforces my first message, our outstanding results are a reflection of our team’s dedication to serving consumers and communities. I am incredibly proud to see the broad based strength in our portfolio, with double-digit sales and profit growth in all reporting segments. In the last 8 months, all eyes have been on Clorox disinfecting products, and our brands delivered once again this quarter, with double-digit sales growth in our Cleaning and Professional Products businesses, reflecting continued higher usage of products in homes, businesses and healthcare settings. And now, we’re also shining a brighter light on the terrific performance delivered by other parts of our portfolio, with double-digit sales growth in eight of 10 businesses, demonstrating the important role our brands play in addressing people’s everyday needs. It’s particularly gratifying to see great results from our Grilling and Glad businesses, as the team has been relentless in driving progress on our business plans, including meaningful innovation. Based on double-digit top line increases and significant margin expansion in our first quarter, we delivered very strong earnings growth for our shareholders and I’m happy we were able to raise our fiscal year outlook. These results would not be possible without the passion and commitment of our Clorox teammates around the world. I’m thankful and proud of how they live…

[Operator Instructions] First question comes from Andrea Teixeira with JPMorgan.

Hi, thank you and congrats everybody for the results. Linda, I was just following up from your comments and also Kevin on, kind of the momentum of the portfolio, and obviously you raised your guide for organic. But it does look like your EPS could have some room here. I was just trying to see if you can help us like gauge the level of investment, or perhaps some of the mix effect that we should be seeing, so that you kept your EPS relatively under control, given the gain that you had just to kind of parse out what part of it is investment in promo or just a mix effect? Thank you.

Hi Andrea, this is Kevin. I can talk about our EPS, as you think about the balance of the year. So as you mentioned, we’ve raised our expectations for the year 5% to 8% off to a very strong start to the year. If you think about the impact of the balance of the year, as I’m sure you’ve done the math, we are projecting we will be down in the back half of the year on our EPS year-over-year, that’s primarily driven by the impact of the prior year. If you recall, we grew EPS, about 30% in the back half of fiscal year ‘20. So from the initial impact of COVID-19, the pantry loading, very strong results in the back half of the year. We have to lap that and in addition to lapping that, as we’ve spoken in the last couple of calls, we are leaning in and investing behind the additional growth opportunities we see in front of us. And you may have heard in my prepared remarks, we think that advertising investment will be back-half loaded. So we would expect to be spending about 12% of sales in the back half. One, supporting a very robust innovation program we have teed up for the back half of the year, as well as pursuing a number of new growth initiatives, both our partnerships and some of the international opportunities we are spending behind. And maybe just a last comment I’d make, Andrea, and I think you know this about us. We are certainly not looking to maximize one quarter, but making sure we’re taking the right investments that generate long-term value. And so, we think there is a good opportunity for us to do that, and we will certainly do it in the back half of the year.

That’s fair. And if I can just ask about Professional, where do you think this business can become, as you are progressing with all these investments and new partnerships?

Yes. Professional has been a strong part of our portfolio for a number of years, with high-single digit increases up to this point, and we continue to see a long runway for the business, both in the businesses that are established well today, in the Healthcare and Industrial customer setting, but also we’re setting our sights on expanding the reach this business can have, as consumers start to leave their home and we can create environments, partnering with businesses to keep them safe. So that’s what we’re focused on right now, is investing in the people to support that future growth, investing in the innovation to support that future growth, and of course investing in the brand, so that people continue to turn to the most trusted cleaning disinfecting brand with Clorox.

Thank you, both.

Next question comes from Wendy Nicholson with Citi.

Hi, my first question is just sort of a follow-up to that, totally get the difficult comparison year-over-year in the March and June quarters, a 100%. But I also heard you call out higher commodities, and may be freight. And I just wanted to ask what your thoughts were on pricing, whether you plan to take price increases to offset some of those commodity increases, or whether you feel like the market is tentative and shaky enough, where it’s better to potentially hold off on pricing?

Yes, Wendy. Thanks for the question. We are committed to not taking pricing during the pandemic, it’s to do the right thing and we want to make sure consumers have our products at the right value. And so what we’re focused on right now, is a continued lean into our aggressive cost savings program that we’ve had for a number of years, to ensure that we have the fuel to manage the investments that we have and of course to manage any bumpiness we expect in commodities. But we do expect cost increases through the back half as you said, and we’re monitoring that environment closely. But again we are committed to ensuring that consumers have our brand during a recessionary time at the right value, not taking pricing during a pandemic and leveraging our cost savings program to manage through short-terms up and down.

Got it. And that actually leads into my second question, which is kind of thinking sort of strategically, but also very much with an eye toward the dollars that you’re investing in capacity. I mean clearly, there is a surge right now and the fact that you are signing so many agreements with the airlines or whatever, I mean clearly there is just a huge demand for disinfecting products and wipes in particular. But there will be a day when that passes. I’m kind of curious just as you think about capital spending, are you hurrying to build capital to support demand that is I think going to be huge for some time to come, but is eventually going to fade. How do you think about that conceptually, so that you don’t end up with a lot of capital, but ends up not being needed two years or three years down the road?

Got it, Wendy. I think it would be helpful to step back and just talk a little bit about what we’re seeing in the macro environment, and why we have strong belief that we’re going to see a lot of these behaviors continue well into the future. We’re seeing consumers in the U.S. and around the world, cleaning much more frequently, cleaning new surfaces and of course cleaning both in and outside of the home and that is true for business customers as well, where they’re having to welcome people back to their businesses, with safe environment. From our research with consumers, they are telling us that they expect many of these behaviors to stick, regardless of whether or not, there is a vaccine or how long COVID goes on, because it’s a way to reassure their health and wellness and for them to feel safe. So we’re hearing from consumers that this is here to stay and we’ve seen evidence of that in past pandemics, as well as just bad cold and flu seasons, where people have adopted new behaviors. The other thing I would tell you, in addition to capacity supporting just that change in behavior, we also see significant growth opportunities that are brand new to our business. Expanding Clorox Disinfecting Wipes and international, if you step back, we’re in about 100 countries around the world with very little presence in disinfecting wipes. That’s a big opportunity for us, complete white space that as we built capacity, we can lean into that even further. And the other thing that I would talk about is, in the industrial space, there’s new technologies that we have, and we think those cleaning behaviors will need to change on a more permanent basis, to reassure people that it’s safe to enter those businesses. And so that’s the other thing I would just put in perspective. We can shift supply to the opportunities that are most poignant at the moment, as we move forward. And then of course Wendy, as you always know we’re really good at balancing and spending capital in a disciplined way, and we can make adjustments to our network, whether that be through in-housing or working with third party manufacturers as we move forward, and we’ve been very balanced in how we’ve approached this, so that we can do just that.

Great, thanks. Sounds terrific.

Next question comes from Kevin Grundy with Jefferies.

Thanks. Good afternoon, everyone and congrats on a really strong result. Just kind of building on Wendy’s question a little bit. I wanted to kind of dig into the organic sales growth guidance. So not expecting think it’s a wide range, but understandably so, up 5% to 9% core sales coming up from what was previously flat to up low-single digits in August. So can you dimension for us a bit, what’s changed since early August? This is – retail is carrying higher inventory levels now in some of the higher demand category, an extremely strong quarter that was not anticipated in early August, with Kingsford as an example. Maybe just dimension for us, because the magnitude of the upward revision is noteworthy. Maybe just kind of dimensionalize for us a bit, what’s driving the more bullish outlook? And then I have a follow-up for Kevin, on cash flow.

Hey Kevin, this is Kevin. I can take your first question as well, as it relates to sales. And to your point, we’ve taken up our expectation for the balance of the year pretty materially. I think there is a number of things we are seeing that’s giving us even more confidence for this year. The first is, we continue to see growing household penetration. So we are now three quarters into the pandemic in Q1, and it continued to grow. Additionally, we’re seeing increased repeat purchase rates with both new and existing consumers, and so growing household penetration, accelerating repurchase rates, both giving us more confidence, and as you know, we’ve been exploring a number of additional growth opportunities, both our partnerships, as well as expanding our disinfecting portfolio outside the U.S., and we’re seeing more and more opportunity in both those spaces, that will start to contribute in the back half of the year. And then maybe the last time I’d mentioned is, while we knew, we’d have a very strong year as it relates to our disinfecting portfolio, we’re seeing very strong results outside of disinfectant. I mean you clearly saw our results in our Household segment. Again, we’re seeing users, more users coming into those categories, they’re increasing their frequency of usage, and we think that’s going to continue through the balance of the fiscal year. So I’d say those are the key drivers that led to us taking up the outlook for the full year.

Got it. Alright, thanks Kevin. That’s helpful. I have a number of questions, but I’ll – just one more if I may. Just on with respect to balance sheet and cash flow, so through the cash balance is higher than you are normally carrying and the business typically needs, from a working capital perspective. Understanding is a lot the business is considering now with respect to additional capacity and so forth, but between the higher than normal cash balances, the business is throwing off a significant amount of cash from operations. Talk a little bit about if you were, just in terms of intentions with respect to capex and is there any intention to return to share buybacks as well, something that the company has kind of gotten away from a little bit in recent quarters, but now as we sort of move through the pandemic and there is greater visibility, it could be something that’s potentially on the table. So, thanks for all that and I will pass it on.

Sure. Happy to, Kevin, talk about cash. And as you mentioned, Kevin, we are seeing a pretty significant acceleration in the cash we are generating. Last year, our cash provided by operations was up about 56%. In Q1, it was up about 40%. We’re sitting on just a little under $900 million of cash on the balance sheet, which to your point is more than we typically hold. That really gives us quite a bit of financial flexibility. So for Lind and I, job one will be to continue to look for opportunities to invest in our base business. We know that’s where we can continue to create very strong returns for our shareholders. So we will do that, including investing more in capacity to the extent we think that’s required. Additionally, we will continue to look for targeted M&A. We still have an interest in pursuing strategic acquisitions. The good news is, they don’t feel like we have to do it to be successful, we got plenty of cash to pursue acquisitions to the extent we find a good opportunity. And then Kevin, you mentioned about share buybacks, we actually restart our share buybacks very modestly in the fourth quarter toward the end of the quarter, and in this quarter, we returned about $240 million to shareholders, combination of our dividend, plus about $100 million in share buybacks, that we assigned all to our dilution management program. So we are back in the market, I do expect that to continue. I expect this year, we will return around $900 million to shareholders, both in the form of our dividend, and our share repurchase program. But I think the key takeaway you should have is, the company continued to generate a significant amount of cash, and that gives us a lot of financial flexibility to pursue growth, both organically and inorganically.

Got it. Very helpful. Good luck.

Thanks, Kevin.

Next question comes from Jason English with Goldman Sachs.

Hey, good afternoon folks. Thank you so much for spotting me in, very much appreciate it. A couple of quick questions. First, based on your prepared remarks, it sounds like you’re still running behind demand in Health and Wellness, effectively selling everything you can make. In that context, the $800 million revenue you’ve been able to reduce to and sell to the last few quarters, any reason to believe that would drop off, as we go into the second quarter?

Jason, this is Kevin. We expect to still continue to have very strong Q2. As you heard, we think we will be up double-digits. The one thing I’d point to you is if you look at our Q1, we delivered 27% revenue growth. About 2 to 3 points was related to rebuilding retailer inventories. That was on Kingsford, our vitamins, minerals and supplements, as well as our Clorox liquid bleach. We’ve made pretty good progress on catching up with demand on Clorox bleach, and so we rebuilt some capacity in Q1. So I’d expect to have some impact on Q2. But beyond that I expect to see continued very strong performance in our cleaning portfolio, and that’s – my comment is a global comment, not just in the U.S., but globally.

Got it. So maybe not, but we are probably not too far off is what I heard. Your full year guidance, from a reinvestment perspective, suggests that, if I look at A&P, and I just compare it sort of a clean year in fiscal ‘19, you’re looking to spend roughly $180 million more in A&P than you did two years ago, and SG&A is expected to be up around $150 million than it was two years ago. As we think forward, how much of those costs do you expect to stick, and how many of them do you think you’ll have the flexibility to retract, when and if demand begins to subside?

Yes. Thanks Jason. I’ll start with that. You know these investment levels are not a mandate in our business, they are a choice. And we’re choosing to lean into the momentum we see in our portfolio right now, behind some of what Kevin covered. Household penetration has more than doubled the amount of our portfolio that’s stable or growing. We have the highest ever consumer value measures, so – the percentage of people deem our products as superior. We are seeing people enter our categories at rates we’ve never seen before, and we are seeing repeat, although it’s early, strong. And so what we are trying to do by increasing our advertising and sales promotion spending, by increasing our admin spending, is about accelerating the long-term performance of the company, and that is what we are aspiring to do. And so it’s a choice, it’s not something that we have to do or that’s dictated by the market, and we think it’s a smart choice, because what it allows us to do, is hold on to new households and you know the customer acquisition is one of the toughest things we do in established categories that have high share. So we want to make sure that we’re doing that. We see additional places where we can grow household penetration in the U.S. and beyond in our categories, and we want to ensure we’re doing that. And then we want to support the behavior change that we see with consumers, whether it be in Health and Wellness, the fact that they’re drinking more water or taking more supplements. In hygiene, the fact that they are cleaning more, the fact that they are cleaning new surfaces and they are doing it and inside and outside of the home, supporting behaviors, as people stay at home. So people have been delighted by the fact they get to cook and they are actually enjoying more time around the family meal table and they are able to use different methods of cooking, like grilling, during the week, not just on the weekend or a special occasion. So we think of this investment in both administrative spending and in A&SP, support keeping those new consumers in, bringing additional people into our franchise, in hopes that we can accelerate the long-term performance. But I just want to be clear, it’s a choice, and it’s always a choice that we can revisit, if these behaviors are not as sticky, and we can optimize. One other fact I’d give you, Jason, because I think it’s important. We went back and looked at our spending. Recall that we put about $70 million of incremental spending in the back half of fiscal year ‘20, and the return on investment was extremely strong, and it gave us confidence to lean in, in fiscal year ‘21, that this is both a good short term spend and long-term spend.

Super helpful. Thank you so much.

Thanks Jason.

Next question comes from Olivia Tong with Bank of America.

Thanks. Good afternoon. My first question is around the impact of volume growth and mix to gross margin that you called out because of volume growth. Could you talk about why it was such an outsized contributor this quarter versus last? Because volume was strong obviously, but only a point different versus Q4, and then on mix, I understand the aggregate benefit, but I suspect you saw gross margin improvement in each of your segments as well. So can you talk a little bit about promotion, whether that was a factor or lack thereof was a factor?

Hi Olivia. Yes, I can talk about those questions. Let me start with benefit of volume to gross margin. It was more impactful in Q1 as you said versus Q4. We got a little over 400 basis points of benefit to margin in the Q1. If you go back to Q4, it is about 350 basis points of benefit. And so, as we have seen our volume continue to grow, we delivered about 22% volume growth last quarter, and were up stronger this quarter. So we are seeing a little bit incremental benefit. And then on the mix side, the mix was really driven by business unit mix, as we shared with you in our prepared remarks. We saw a very strong growth from our Household segment, and that tends to have a higher revenue and higher margin, in those businesses, relative to the average for the company. So we have five points of favorable price mix. It was mostly all mix, and it was mostly driven by the strength of certain ones of our businesses growing at an accelerated rate.

That’s helpful. And then on consumption trends in your key categories, obviously like to moving parts we see still catch up to demand, in the Health and Wellness segment. But then, you are obviously going to have some volatile comps in household, but specific to household, can you just talk about the drivers of the acceleration there, because the comp was easier, but it was two points easier versus Q4 and you accelerated growth by over 20 points. So how much of this is related to exogenous factors like COVID and more time at home or an active outdoor season, versus attracting new consumers to the categories of your brands. And what do you think is sort of a sustainable growth rate for the household business going forward?

Olivia, I will highlight two businesses. I will highlight Grilling and Glad as good examples of what we have done, and what our expectations are moving forward. So grilling more than doubled sales, as we talked about, and this was due mainly to strong consumption. We did see some inventory replenishment, but that was about a third of what we saw from a sales growth perspective. And what’s going on, are two factors that are coming together really nicely. We spoke about in our Investor Day in October, the fact that we were rebuilding our business plan on Grilling from the ground up. And that was based on business plans that we are in partnership with retailers to grow categories, and fundamentally reinventing our innovation program on grilling. And that has worked very well. You combine that with new behaviors we are seeing in the grilling category and that’s really where we got to the place, where we experienced double-digit sales growth. And what we are seeing from consumers is this, about three quarters of people, even as mobility has increased in the U.S., are continuing to cook at home and expect to continue to cook at home, as they move forward. We are seeing 50% of charcoal grillers, grill more during COVID, and the vast majority of those, expect to continue to grill more, regardless of whether or not COVID is around in the near future, or farther ahead. And the most exciting thing for us, is we are seeing grilling occasions become everyday meal occasions. So before, most of the time when people were grilling, it was for the weekends, gatherings outside for holidays, and now we are seeing the grill being used for everyday occasions, and we expect that trend to continue. So those two things coming…

Thanks. Congrats on a great quarter.

Next question comes from Steve Powers with Deutsche Bank.

Yes. Hey, thanks. A couple of quick follow-ups, if I could and then I actually really want to ask about the international supply chain in wipes, but just to clean up what you were just talking about to Olivia? The Household and Lifestyle, you mentioned the inventory catch-up, can you just confirm whether those inventories were back in balance actually in the quarter, or whether there are any lingering pockets of dislocation we should be aware of?

For Grilling, we have mainly gotten back to a point where we are in supply, and given this is the smaller quarter for Kingsford coming up, just given seasonality, we think we are in a good position moving forward. We still have some work to do on Glad, and still have additional work to do on Vitamins Minerals and Supplements and Brita. So we are not out of the woods yet and what we will say is, it will be a staggered recovery across those businesses that we have remaining over the next two quarters.

Okay. That helps. And then on the international supply chain in wipes, can you give us a little bit more detail us to what that looks like as we stand here today? How expensive it is? How much is in-sourced versus, I presume, most of it outsourced, but just some color there? And then how is that may be likely to change over time, as you build out against the opportunities that you spotlighted?

Happy to. Yes, this supply chain was incredibly important for us to build it local, in-market, so that we could react to the opportunities we saw quickly, and we stood the supply chain up in just a matter of months, and we already have product shipping into countries today. We do have locations around the world, where we are supplying, because again we have business in Latin America and Asia, and so we are thinking about that expansion, ensuring that we have a distribution availability in that market. We also have designed this product from the ground up as well specifically for the consumer in those markets. So the needs can be a little bit different, depending on the country that you are in, the size of the wipe, the way that they want the lotion to feel. So again, did that within a matter of months and stood it up. We will continue to be flexible. Just as we have built this business in the U.S. over the last 20 years, as we expand in International, we will have all of those things under consideration, how much makes sense for us to have in-house, how much it makes sense to have with third-party suppliers. But the good news about this is, we find the supply chain to be scalable, and will lean in and pursue this opportunity aggressively, because we think our products can help so many more people around the world.

Okay. Thanks Linda. Appreciate it. I will leave it there.

Thanks.

Next question comes from Jonathan Feeney with Consumer Edge. Jonathan, your line is open. [Operator Instructions] We have a question from Lauren Lieberman with Barclays.

Great, thank you. I guess I wanted first off I wanted to talk about untracked channel dynamics, because you were helpful in sharing that about two to three points of the sales growth this quarter was related to restocking retail inventories. But there is still kind of even outside of that, a number of these businesses that really don’t tie to what’s showing up in Nielsen. So I was curious, I guess, if there is new distribution, we should be aware of for Glad or for Kingsford, in particular, and if not just you know is the performance offline dramatically different – sorry, on track, dramatically different than tracked?

Sure Lauren. Happy to start on that one. So I think it’s safe to say that the relationship in our performance in tracked channels and on track is going to be less linear over time, and is certainly less linear in Q1. But I think it would be helpful to back up and just set the backdrop for what we’ve seen in fiscal year ‘20 and then specifically get into Q1 and then our expectations on this one moving forward. So if you back up in fiscal year ‘20 tracked channels for us as a total company, including international and our professional products business, represented about 60% of total company sales. 80% of total U.S. retail is in tracked channels. And what happened this quarter is, we had strong growth in professional products in international and that accounts for about a quarter of our sales growth, which of course is not accounted for in Nielsen as you highlighted. But if you looked at tracked and non-tracked channels, those growth rates were about the same at about 20%, and that makes sense, because we have been on allocation for a number of our businesses, so you would expect to see both of those at about the same rate. But as you mentioned, Kevin called out inventory, and as we started to replenish inventory and businesses like Kingsford, Brita, Bleach and Vitamins. Minerals and Supplements, that accounted for about two to three points this quarter of the disconnect. We also had a year ago inventory effect, if you think about grilling, because last year we had the inventory, this year we have low inventory and heavy sales that we were replenishing that consumption, and you saw a disconnect in Grilling. And then the one other thing I would call out for you Lauren is promotional periods versus year ago, and I would really caution everybody against using narrow time periods like a week or four weeks, because those periods have changed year-over-year and it causes noise in the data, as well as the fact that we were not merchandising anything in our cleaning and disinfecting portfolio, given our supply. So those two factors both inventory and promotional also contributed. And then going forward, we’d expect this disconnect to continue, because we expect strong growth from international, strong growth from professional products. And then as more consumers move online, more of that will be on track.

Okay, that’s super helpful. And then the other question that was a little bit longer term. So historically, right, a key kind of mantra for Clorox was big share brands in mid-sized categories, right, and that’s still in your investor slide deck and still kind of how you talked about your business. The thing though, is that, your previously mid-sized categories are becoming really big categories, where everybody wants to participate. So I guess, Linda, wanted to talk a little bit about how you may be factoring that change in, whether it’s competitive dynamics, overall category size, attention being paid to these businesses where you’ve kind of been able to operate at a very high level, but arguably with a bit less competitive intensity historically, then may be the case going forward?

Sure Lauren. Let me try to take that in a couple of buckets, and start first with just your portfolio question. And I feel terrific about our portfolio. If you look at the broad-based growth we had, eight out of 10 businesses with double-digit sales growth, growing most businesses expansion and household penetration, strong consumer value measure across those businesses. I think our portfolio is in a terrific place to be competitive. And then if I answer your question around big share brands in mid-sized categories, I do think that’s what we are still about. And these categories, even though there is a lot of attractiveness, are still relatively small to some of the categories in store, and even with the growth rates we have been experiencing, we would still consider them to be mid-sized. And then if I think about competition, maybe I would disagree a little bit, Lauren. I think our categories have been competitive for quite a long time. We have had national players, if you think about Cleaning, in that businesses, certainly internationally for a long time, people have entered in our space and wipes before several times. So I think that’s going to continue to be competitive, and to your point, will be more competitive in the near future, because it’s a very attractive place to play right now. And what we turn back to, is really what separates us and how we think we can win, and that starts with having strong brands that consumers love, and that they are loyal to. And as I highlighted at the beginning, those factors around the health of the portfolio, our household penetration, our consumer value measure scores, how we’re seeing people enter our categories give us reassurance that we have the right brands to win in that space. And then Ignite really elevates the role of innovation, and I think that’s going to be critical for us to win in the future in these categories. People’s needs are changing. Their behaviors are changing, and we need to innovate to meet those new needs and we’re feeling terrific about the innovation program we have in place now. About the innovation, you can expect to see in the back half of fiscal year ‘21 and then well beyond that, we’re feeling great about that. So for us, again that moment is about investing right now and leaning into the strength of those brands, knowing it’s going to be more competitive, focusing relentlessly on superior consumer value, and ensuring that people know that our brands offer them the very best, when it comes to meeting their needs today as they deal with COVID, and staying home more. Does that help answer your question Lauren?

It does. Yes, thank you so much Linda.

Thanks.

[Operator Instructions] I have a question from Jonathan Feeney with Consumer Edge. Please go ahead.

Hey thanks for fitting me, and sorry about that. I had some technical difficulties, pretty more than the usual, great quarter. Just – and I apologize if this has been asked, does your 27% organic sales gain in your opinion represent any data you have, a share gain on a weighted basis versus your categories? Because I am trying to figure out where you stand, particularly in cleaning but broadly, and then as a related question, what’s your current share of sales right now in e-commerce, which would probably be your fastest growing and highest contributive non-measured sales? Thanks very much.

Sure. Jonathan, I think we can’t answer the question of folks, we have categories that don’t have relevant track share data that we can quantify so Professional Products is a good example and international. But I think if you look at all outlets, we are in a place where share is about flat right now and most of that is due to supply constraints and we would anticipate, if we were in a position to better supply across those categories, to see improvement on that, and I know you know that we hold all of our businesses accountable to growing share. So that’s what I would say about the first part of your question. And then, what I think about moving forward, and how we are anticipating looking at that we are trying to see, is in the very narrow buckets that we compete in, whether that be online or out of home, how are we doing in that individual space, because it’s hard to aggregate this and understand what we’re doing broadly. So we’re looking country by country. We are looking at specific channels in our professional business to see how we are doing, and then we are looking at online. Online specifically about two-thirds of our brands are number one share online, which lines up nicely with the rest of our portfolio, and we’re doing very well there. And that has to do with the early investments we made in e-commerce. We were one of the first to stand up a fully dedicated team on e-commerce pure play customers, as well as standing up integrated teams on our brick and click customers. So we’re in a very good position online, as consumers continue to move online, we will continue to invest there. And you know, the one other thing I would point out is, we have been spending over 60% of our dollars online for a number of years. So we are where shoppers are today, and that has helped contribute to that share expansion.

Okay, thank you very much.

[Operator Instructions] And this concludes the question-and-answer session. Ms. Rendle, I would now like to turn the program back over to you.

Thank you so much, Sharon. I feel great about our strong start to fiscal year ‘21 and look forward to another year of delivering value to all our stakeholders. Thank you so much everyone, and we will speak again on our next call in February. We hope you all stay well. Take care.

This concludes today’s conference call. You may now disconnect.