Company: CLX
Filing Date: 2025-11-03
Form Type: 10-Q
Source: 0000021076-25-000053
Chunk: 71

Company: CLOROX CO /DE/
Filing Date: 2025-11-03
Form: 10-Q
Item: Part I, Item 8
Chunk 71
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 due to the lower shipments in the current three month period following the incremental shipments related to the ERP transition in the fourth quarter of fiscal year 2025. The higher Accounts payable and accrued liabilities balance was due to the timing of payments.

Payment Terms Extension and Supply Chain Financing 

The Company has arranged for a global financial institution to offer a voluntary supply chain finance (SCF) program for the benefit of the Company’s suppliers. The Company’s current payment terms do not exceed 120 days in keeping with industry standards. The Company’s operating cash flows are directly impacted as a result of the extension of payment terms with suppliers. There would not be an expected material impact to the Company’s liquidity or capital resources if the financial institution or a supplier terminated the SCF arrangement. While the Company does not have direct access to information on, or influence over, which invoices a participating supplier elects to sell to the financial institution, the Company expects that the majority of these amounts have been sold to the financial institution. Refer to the notes to condensed consolidated financial statements for detail on the SCF program.

Investing Activities

Net cash used for investing activities was $34 in the current three month period, compared with net cash proceeds of $89 in the prior three month period. The year-over-year change was mainly due to net proceeds from the sale of the Better Health VMS business in the prior three month period.

25

FINANCIAL POSITION AND LIQUIDITY (Continued)

Financing Activities

Net cash used for financing activities was $59 in the current three month period, compared with $237 in the prior three month period. The year-over-year change was mainly due to higher cash sourced from short term borrowings in the current three month period.

Capital Resources and Liquidity

As of September 30, 2025, current liabilities exceeded current assets by $539, primarily due to the Company's Glad venture agreement terminal obligation coming due for payment in January 2026. This balance is classified within Accounts payable and accrued liabilities as it is reasonably expected to be settled within one year. The venture agreement terminal obligation is expected to be repaid through the Company’s anticipated ability to generate positive cash flows from operations in the future, access to capital markets enabled by our strong short-term and long-term credit ratings and current borrowing availability.

Notwithstanding potential unforeseen adverse market conditions and as part of the Company’s regular assessment of its cash needs, the Company believes it will have the funds necessary to support its short- and long-term liquidity and operating needs,