Company: CLX
Filing Date: 2025-05-05
Form Type: 10-Q
Source: 0000021076-25-000023
Chunk: 121

Company: CLOROX CO /DE/
Filing Date: 2025-05-05
Form: 10-Q
Item: Part I, Item 2
Chunk 121
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. It also allows investors to view underlying operating results in the same manner as they are viewed by Company management. 

Of the total investment, approximately 70% is expected to represent incremental operating costs primarily recorded within selling and administrative expenses to be adjusted from reported earnings before income taxes for purposes of disclosing adjusted EBIT over the course of the next five years. About 70% of these operating costs are expected to be related to the implementation of the ERP, with the remaining costs primarily related to the implementation of complementary technologies.

During the three and nine months ended March 31, 2025, the Company incurred approximately $26 and $81, respectively, and during the three and nine months ended March 31, 2024, the Company incurred approximately $26 and $85, respectively, of operating expenses related to its digital capabilities and productivity enhancements investment. The expenses relate to the following:

Three months endedNine months ended3/31/20253/31/20243/31/20253/31/2024External consulting fees (1)$19 $19 $56 $65 IT project personnel costs (2)1 2 5 6 Other (3)6 5 20 14 Total$26 $26 $81 $85 

(1)Comprised of third-party consulting fees incurred to assist in the project management and end-to-end systems integration of this transformative investment. The Company relies on consultants for certain capabilities required for these programs that the Company does not maintain internally. These costs support the implementation of these programs incremental to the Company's normal IT costs and will not be incurred following implementation.

(2)Comprised of labor costs associated with internal IT project management teams that are utilized to oversee the new system implementations. Given the magnitude and transformative nature of the implementations planned, the necessary project management costs are incremental to the historical levels of spend and will no longer be incurred subsequent to implementation. As a result of this long-term strategic investment, the Company considers these costs not reflective of the ongoing costs to operate its business.

(3)Comprised of various other expenses associated with the Company’s new system implementations, including Company personnel dedicated to the project that have been backfilled with either permanent or temporary resources in positions that are considered part of normal operating expenses.

34

NON-GAAP FINANCIAL MEASURES (Continued)

Organic sales growth / (decrease) is defined as net sales growth / (decrease) excluding the effect of foreign exchange