Company: CLX
Filing Date: 2025-05-05
Form Type: 10-Q
Source: 0000021076-25-000023
Chunk: 40

Company: CLOROX CO /DE/
Filing Date: 2025-05-05
Form: 10-Q
Item: Part I, Item 1
Chunk 40
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 excluding interest income, interest expense and other significant items that are nonrecurring or unusual (such as the pension settlement charge, incremental costs and insurance recoveries related to the August 2023 cyberattack, asset impairments, charges related to the streamlined operating model, charges related to the digital capabilities and productivity enhancements investment, significant losses/(gains) related to acquisitions / divestitures and other nonrecurring or unusual items impacting comparability). The Company uses this measure to assess the operating results and performance of its segments, perform analytical comparisons, identify strategies to improve performance, and allocate resources to each segment. Management believes that the presentation of adjusted EBIT is useful to investors to assess operating performance on a consistent basis by removing the impact of the items that management believes does not directly reflect the performance of each segment's underlying operations. Adjusted EBIT margin is the ratio of adjusted EBIT to net sales.

32

NON-GAAP FINANCIAL MEASURES (Continued)

Reconciliation of earnings (losses) before income taxes to adjusted EBITThree months endedNine months ended3/31/20253/31/20243/31/20253/31/2024Earnings before income taxes$254 $(42)$668 $123 Interest income(2)(4)(7)(21)Interest expense23 22 66 69 Loss on divestiture (1)— 240 118 240 Pension settlement charge (2)— — — 171 Cyberattack costs, net of insurance recoveries (3)(35)8 (70)57 Streamlined operating model (4)— 10 — 13 Digital capabilities and productivity enhancements investment (5)26 26 81 85 Adjusted EBIT$266 $260 $856 $737 

(1)Represents losses related to the divestiture of the Better Health VMS and Argentina businesses. Due to the nature, scope and magnitude of these costs, the Company’s management believes presenting these costs as an adjustment in the non-GAAP results provides additional information to investors about trends in the Company’s operations and is useful for period over period comparisons. It also allows investors to view underlying operating results in the same manner as they are viewed by Company management. See Notes to Condensed Consolidated Financial Statements for additional information. 

(2)Represents costs related to the settlement of the domestic qualified pension plan. Due to the nature, scope and magnitude of these costs, the Company