10-Q 1 wdfc-20240229.htm 10-Q wdfc-20240229
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
þQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended February 29, 2024
oTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to ________
Commission File Number: 000-06936
Commission Company Name: WD 40 CO
WD-40 COMPANY
(Exact name of registrant as specified in its charter)
Delaware95-1797918
(State or other jurisdiction
of incorporation or organization)
(I.R.S. Employer
Identification No.)
9715 Businesspark Avenue, San Diego, California
92131
(Address of principal executive offices)(Zip code)
Registrant’s telephone number, including area code: (619) 275-1400
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol Name of exchange on which registered
Common stock, par value $0.001 per share WDFC NASDAQ Global Select Market
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.
Yes þ No o
Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer þ Accelerated filer o Non-accelerated filer o Smaller reporting company o
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes o No þ
The number of outstanding shares of the registrant’s common stock, par value $0.001 per share, as of April 3, 2024 was 13,552,637.
1

WD-40 COMPANY
QUARTERLY REPORT ON FORM 10-Q
For the Quarter Ended February 29, 2024
TABLE OF CONTENTS
2

PART 1 — FINANCIAL INFORMATION
Item 1.    Financial Statements
WD-40 COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited and in thousands, except share and per share amounts)
February 29,
2024
August 31,
2023
Assets
Current assets:
Cash and cash equivalents$55,443 $48,143 
Trade and other accounts receivable, net104,794 98,039 
Inventories78,029 86,522 
Other current assets12,248 15,821 
Total current assets250,514 248,525 
Property and equipment, net64,575 66,791 
Goodwill95,499 95,505 
Other intangible assets, net4,165 4,670 
Right-of-use assets10,968 7,820 
Deferred tax assets, net1,189 1,201 
Other assets15,111 13,454 
Total assets$442,021 $437,966 
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable$32,405 $30,826 
Accrued liabilities31,710 30,000 
Accrued payroll and related expenses14,869 16,722 
Short-term borrowings29,790 10,800 
Income taxes payable1,657 494 
Total current liabilities110,431 88,842 
Long-term borrowings85,894 109,743 
Deferred tax liabilities, net10,987 10,305 
Long-term operating lease liabilities5,509 5,832 
Other long-term liabilities12,922 13,066 
Total liabilities225,743 227,788 
Commitments and Contingencies (Note 12)
Stockholders’ equity:
Common stock — authorized 36,000,000 shares, $0.001 par value; 19,920,049 and 19,905,815 shares issued at February 29, 2024 and August 31, 2023, respectively; and 13,554,668 and 13,563,434 shares outstanding at February 29, 2024 and August 31, 2023, respectively
20 20 
Additional paid-in capital173,263 171,546 
Retained earnings487,233 477,488 
Accumulated other comprehensive loss(31,249)(31,206)
Common stock held in treasury, at cost — 6,365,381 and 6,342,381 shares at February 29, 2024 and August 31, 2023, respectively
(412,989)(407,670)
Total stockholders’ equity216,278 210,178 
Total liabilities and stockholders’ equity$442,021 $437,966 
See accompanying notes to condensed consolidated financial statements (unaudited).
3

WD-40 COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited and in thousands, except per share amounts)
Three Months Ended February 29/28,Six Months Ended February 29/28,
2024202320242023
Net sales$139,105 $130,193 $279,521 $255,086 
Cost of products sold66,164 64,115 131,027 124,753 
Gross profit72,941 66,078 148,494 130,333 
Operating expenses:
Selling, general and administrative45,023 37,690 89,158 77,674 
Advertising and sales promotion6,725 5,985 13,708 11,324 
Amortization of definite-lived intangible assets252 250 503 503 
Total operating expenses52,000 43,925 103,369 89,501 
Income from operations20,941 22,153 45,125 40,832 
Other income (expense):
Interest income66 51 140 95 
Interest expense(1,008)(1,502)(2,154)(2,671)
Other (expense) income, net(193)165 (233)315 
Income before income taxes19,806 20,867 42,878 38,571 
Provision for income taxes4,270 4,341 9,860 8,048 
Net income$15,536 $16,526 $33,018 $30,523 
Earnings per common share:
Basic$1.14 $1.21 $2.43 $2.24 
Diluted$1.14 $1.21 $2.42 $2.23 
Shares used in per share calculations:
Basic13,55813,58313,55913,586
Diluted13,58313,60813,58313,608
See accompanying notes to condensed consolidated financial statements (unaudited).
4

WD-40 COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited and in thousands)
Three Months Ended February 29/28, Six Months Ended February 29/28,
2024202320242023
Net income$15,536 $16,526 $33,018 $30,523 
Other comprehensive income (loss):
Foreign currency translation adjustment(433)8 (43)1,344 
Total comprehensive income$15,103 $16,534 $32,975 $31,867 
See accompanying notes to condensed consolidated financial statements (unaudited).
5

WD-40 COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(Unaudited and in thousands, except share and per share amounts)
Common StockAdditional
Paid-in
Capital
Retained
Earnings
Accumulated
Other
Comprehensive
Income (Loss)
Treasury StockTotal
Stockholders’
Equity
SharesAmountSharesAmount
Balance at August 31, 202319,905,815$20 $171,546 $477,488 $(31,206)6,342,381$(407,670)$210,178 
Issuance of common stock under share-based compensation plan, net of shares withheld for taxes5,680(678)(678)
Stock-based compensation2,271 2,271 
Cash dividends ($0.83 per share)
(11,297)(11,297)
Repurchases of common stock11,500(2,414)(2,414)
Foreign currency translation adjustment390 390 
Net income17,482 17,482 
Balance at November 30, 202319,911,495$20 $173,139 $483,673 $(30,816)6,353,881$(410,084)$215,932 
Issuance of common stock under share-based compensation plan, net of shares withheld for taxes8,554 (1,742)(1,742)
Stock-based compensation1,866 1,866 
Cash dividends ($0.88 per share)
(11,976)(11,976)
Repurchases of common stock11,500(2,905)(2,905)
Foreign currency translation adjustment(433)(433)
Net income15,536 15,536 
Balance at February 29, 202419,920,049$20 $173,263 $487,233 $(31,249)6,365,381$(412,989)$216,278 
See accompanying notes to condensed consolidated financial statements (unaudited).

6

WD-40 COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(Unaudited and in thousands, except share and per share amounts)
 Common StockAdditional
Paid-in
Capital
Retained
Earnings
Accumulated
Other
Comprehensive
Income (Loss)
Treasury StockTotal
Stockholders’
Equity
SharesAmountSharesAmount
Balance at August 31, 202219,888,807$20 $165,973 $456,076 $(36,209)6,286,461$(397,236)$188,624 
Issuance of common stock under share-based compensation plan, net of shares withheld for taxes7,670(600)(600)
Stock-based compensation2,719 2,719 
Cash dividends ($0.78 per share)
(10,634)(10,634)
Repurchases of common stock22,420(4,072)(4,072)
Foreign currency translation adjustment1,336 1,336 
Net income13,997 13,997 
Balance at November 30, 202219,896,477$20 $168,092 $459,439 $(34,873)6,308,881$(401,308)$191,370 
Stock-based compensation2,261 2,261 
Cash dividends ($0.83 per share)
(11,324)(11,324)
Repurchases of common stock9,250(1,569)(1,569)
Foreign currency translation adjustment8 8 
Net income16,526 16,526 
Balance at February 28, 202319,896,477$20 $170,353 $464,641 $(34,865)6,318,131$(402,877)$197,272 
See accompanying notes to condensed consolidated financial statements (unaudited).
7

WD-40 COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited and in thousands)
 Six Months Ended February 29/28,
 20242023
Operating activities:
Net income$33,018 $30,523 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization4,683 3,864 
Net (gains) losses on sales and disposals of property and equipment(108)83 
Deferred income taxes711 (224)
Stock-based compensation4,137 4,980 
Amortization of implementation costs associated with cloud computing arrangements313 150 
Unrealized foreign currency exchange losses (gains)245 (1,820)
Provision for credit losses122 53 
Write-off of inventories1,088 568 
Changes in assets and liabilities:
Trade and other accounts receivable(7,071)(9,689)
Inventories7,267 (4,159)
Other assets(2,256)(930)
Operating lease assets and liabilities, net(16)60 
Accounts payable and accrued liabilities3,612 (3,059)
Accrued payroll and related expenses(1,872)260 
Other long-term liabilities and income taxes payable1,019 287 
Net cash provided by operating activities44,892 20,947 
Investing activities:
Purchases of property and equipment(2,092)(3,571)
Proceeds from sales of property and equipment349 290 
Net cash used in investing activities(1,743)(3,281)
Financing activities:
Treasury stock purchases(5,319)(5,641)
Dividends paid(23,273)(21,958)
Repayments of long-term senior notes(400)(400)
Net (repayments) proceeds from revolving credit facility(4,177)8,305 
Shares withheld to cover taxes upon conversions of equity awards(2,420)(600)
Net cash used in financing activities(35,589)(20,294)
Effect of exchange rate changes on cash and cash equivalents(260)2,777 
Net increase in cash and cash equivalents7,300 149 
Cash and cash equivalents at beginning of period48,143 37,843 
Cash and cash equivalents at end of period$55,443 $37,992 
Supplemental disclosure of noncash investing activities:
Accrued capital expenditures
$125 $137 
Finance lease obligation settled with prepaid deposit$3,855 $- 
See accompanying notes to condensed consolidated financial statements (unaudited).
8

WD-40 COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
Note 1.    The Company
WD-40 Company (the “Company”), incorporated in Delaware and based in San Diego, California, is a global marketing organization dedicated to creating positive lasting memories by developing and selling products that solve problems in workshops, factories and homes around the world. The Company owns a wide range of brands that include maintenance products and homecare and cleaning products: WD-40® Multi-Use Product, WD-40 Specialist®, 3-IN-ONE®, GT85®, X-14®, 2000 Flushes®, Carpet Fresh®, no vac®, Spot Shot®, 1001®, Lava® and Solvol®.
The Company’s products are sold in various locations around the world. Maintenance products are sold worldwide in markets throughout North, Central and South America, Asia, Australia, Europe, the Middle East and Africa. Homecare and cleaning products are sold primarily in North America, the United Kingdom (“U.K.”) and Australia. The Company’s products are sold primarily through hardware stores, automotive parts outlets, industrial distributors and suppliers, mass retail and home center stores, value retailers, grocery stores, online retailers, warehouse club stores, farm supply, sport retailers, and independent bike dealers.
Note 2.    Basis of Presentation and Summary of Significant Accounting Policies
Basis of Consolidation
The unaudited condensed consolidated financial statements included herein have been prepared by the Company according to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations. The August 31, 2023 year-end condensed consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by U.S. GAAP.
In the opinion of management, the unaudited financial information for the interim periods shown reflects all adjustments necessary for a fair statement thereof and such adjustments are of a normal recurring nature. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended August 31, 2023, which was filed with the SEC on October 23, 2023.
The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could materially differ from those estimates. Operating results for interim periods are not necessarily indicative of operating results for an entire fiscal year.
Global economic conditions have been adversely impacted and financial markets have experienced significant volatility in recent years. Although the Company’s estimates consider current conditions, the inputs into certain of the Company’s significant and critical accounting estimates include judgments and assumptions about the economic implications of factors that have been subject to such volatility and how management expects them to change in the future, as appropriate. It is possible that actual results experienced may differ materially from the Company’s estimates in future periods, which could materially affect its results of operations and financial condition.
Foreign Currency Forward Contracts
In the normal course of business, the Company employs established policies and procedures to manage its exposure to fluctuations in foreign currency exchange rates. The Company utilizes foreign currency forward contracts to limit its exposure to net asset balances held in non-functional currencies, primarily at its U.K. subsidiary. The Company monitors its foreign currency exchange rate exposures to ensure the overall effectiveness of its foreign currency hedge positions.
9

While the Company engages in foreign currency hedging activity to reduce its risk, for accounting purposes, none of its foreign currency forward contracts are designated as hedges.
Foreign currency forward contracts are carried at fair value, with net realized and unrealized gains and losses recognized in other income (expense), net in the Company’s condensed consolidated statements of operations. Cash flows from settlements of foreign currency forward contracts are included in operating activities in the condensed consolidated statements of cash flows. Foreign currency forward contracts in an asset position at the end of the reporting period are included in other current assets, while foreign currency forward contracts in a liability position at the end of the reporting period are included in accrued liabilities in the Company’s condensed consolidated balance sheets. At February 29, 2024, the Company had a notional amount of $9.9 million outstanding in foreign currency forward contracts, which will mature in March 2024. Unrealized net gains and losses related to foreign currency forward contracts were not significant at February 29, 2024 and August 31, 2023. Realized net gains and losses related to foreign currency forward contracts were not significant for the three and six months ended February 29, 2024 and February 28, 2023. Both unrealized and realized net gains and losses are recorded in other (expense) income, net in the Company’s condensed consolidated statements of operations.
Fair Value of Financial Instruments
Accounting Standards Codification (“ASC”) 820, “Fair Value Measurements and Disclosures”, defines fair value as the exchange price that would be received for an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company categorizes its financial assets and liabilities measured at fair value into a hierarchy that categorizes fair value measurements into the following three levels based on the types of inputs used in measuring their fair value:
Level 1: Observable inputs such as quoted market prices in active markets for identical assets or liabilities;
Level 2: Observable market-based inputs or observable inputs that are corroborated by market data; and
Level 3: Unobservable inputs reflecting the Company’s own assumptions.
Under fair value accounting, assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. As of February 29, 2024, the Company had no assets or liabilities that are measured at fair value in the financial statements on a recurring basis, except for foreign currency forward contracts, which are classified as Level 2 within the fair value hierarchy. The carrying values of cash equivalents and short-term borrowings are recorded at cost, which approximates their fair values, primarily due to their short-term nature. In addition, the carrying value of borrowings held under the Company’s revolving credit facility approximates fair value, based on Level 2 inputs, due to the variable nature of underlying interest rates, which generally reflect market conditions. The Company’s fixed rate long-term borrowings consist of senior notes and are recorded at carrying value. The Company estimates that the fair value of its senior notes, based on Level 2 inputs, was approximately $60.1 million as of February 29, 2024, which was determined based on a discounted cash flow analysis using current market interest rates for instruments with similar terms, compared to their carrying value of $67.2 million. During the six months ended February 29, 2024, the Company did not record any significant nonrecurring fair value measurements for assets or liabilities in periods subsequent to their initial recognition.
Recently Issued Accounting Standards
In November 2023, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures.” These amendments primarily require enhanced disclosures about significant segment expenses regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss. The amendments are effective for the Company’s annual periods beginning September 1, 2024, and interim periods beginning September 1, 2025, with early adoption permitted, and will be applied retrospectively to all prior periods presented in the financial statements. The Company is in the process of evaluating this ASU to determine its impact on the Company’s disclosures.
In December 2023, the FASB issued ASU No. 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures,” which includes amendments that further enhance income tax disclosures, primarily through standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. The amendments are effective for the Company’s annual periods beginning September 1, 2025, with early adoption permitted, and should be applied either prospectively or retrospectively. The Company is in the process of evaluating this ASU to determine its impact on the Company’s disclosures.

10

Note 3.    Inventories
Inventories consisted of the following (in thousands):
February 29,
2024
August 31,
2023
Product held at third-party contract manufacturers$5,031 $6,680 
Raw materials and components10,566 11,924 
Work-in-process277 497 
Finished goods62,155 67,421 
Total$78,029 $86,522 

Note 4.    Property and Equipment and Capitalized Cloud-Based Software Implementation Costs
Property and equipment, net, consisted of the following (in thousands):
February 29,
2024
August 31,
2023
Machinery, equipment and vehicles$54,561 $49,804 
Buildings and improvements27,606 27,555 
Computer and office equipment6,404 6,151 
Internal-use software9,671 11,277 
Furniture and fixtures3,050 3,027 
Capital in progress3,900 7,937 
Land4,218 4,220 
Subtotal109,410 109,971 
Less: accumulated depreciation and amortization(44,835)(43,180)
Total$64,575 $66,791 
As of February 29, 2024 and August 31, 2023, the Company’s condensed consolidated balance sheets included $12.7 million and $11.0 million, respectively, of capitalized cloud-based implementation costs recorded as other assets within the Company’s condensed consolidated balance sheets. These balances primarily consist of capitalized implementation costs related to a new cloud-based enterprise resource planning (“ERP”) system which the Company placed into service in the U.S. during the second quarter of fiscal year 2024. The useful lives of the Company’s internal-use software and capitalized cloud computing implementation costs are generally three to five years. However, the useful lives of major information system installations such as implementations of ERP systems and certain related software are determined on an individual basis and may exceed five years depending on the estimated period of use. The Company has determined the useful life of the new ERP system to be ten years and is amortizing over such period. Accumulated amortization associated with these assets was $1.0 million and $0.7 million as of February 29, 2024 and August 31, 2023, respectively. Amortization expense associated with these assets was not significant for the three and six months ended February 29, 2024 and February 28, 2023.
Note 5.    Goodwill and Other Intangible Assets
Goodwill
The following table summarizes the changes in the carrying amounts of goodwill by segment (in thousands):
AmericasEIMEAAsia-PacificTotal
Balance as of August 31, 2023$85,436 $8,860 $1,209 $95,505 
Translation adjustments(1)(5)- (6)
Balance as of February 29, 2024$85,435 $8,855 $1,209 $95,499 
11


During the second quarter of fiscal year 2024, the Company performed its annual goodwill impairment test. The annual goodwill impairment test was performed at the reporting unit level as of the Company’s most recent goodwill impairment testing date, December 1, 2023. The Company performed a quantitative assessment to determine whether the fair value of any of its reporting units was less than each reporting unit’s carrying amount. The Company determined the fair value of its reporting units by following the income approach, which uses a discounted cash flow methodology. The discounted cash flow methodology bases the fair value of each reporting unit on the present value of its estimated future cash flows. The discounted cash flow methodology also requires that management make assumptions about certain key inputs in the estimated cash flows, including long-term sales forecasts or growth rates, terminal growth rates and discount rates, all of which are inherently uncertain. The forecast of future cash flows was primarily based on historical data and management’s best estimates of sales growth rates and operating margins for each reporting unit for the next five fiscal years. The discount rate used was based on management’s estimate of the current weighted-average cost of capital for each reporting unit. As these assumptions are largely unobservable, the estimated fair values fall within Level 3 of the fair value hierarchy. Based on quantitative analysis, the Company determined that the estimated fair value of each of its reporting units significantly exceeded their respective carrying values. As a result, the Company concluded that no impairment of its goodwill existed as of December 1, 2023. In addition, the Company concluded that there were no indicators of impairment identified as a result of the Company’s review of events and circumstances related to its goodwill subsequent to December 1, 2023 through February 29, 2024. To date, there have been no impairment losses identified and recorded related to the Company’s goodwill.
Definite-lived Intangible Assets
The net carrying value of the Company’s definite-lived intangible assets, which include the Spot Shot, Carpet Fresh, 1001, EZ REACH and GT85 trade names, was $4.2 million and $4.7 million as of February 29, 2024 and August 31, 2023, respectively. These balances are classified as other intangible assets, net in the Company’s condensed consolidated balance sheets. Amortization expense related to these assets was not material for the three and six months ended February 29, 2024 and February 28, 2023.
Note 6.    Leases
Right-of-use assets and lease liabilities consisted of the following (in thousands):
February 29,
2024
August 31,
2023
Assets:
Operating lease right-of-use assets$7,241 $7,820 
Finance lease right-of-use asset3,727 - 
Total right-of-use assets$10,968 $7,820 
Liabilities:
Current operating lease liabilities(1)
$1,864 $2,144 
Long-term operating lease liabilities5,509 5,832 
Total operating lease liabilities$7,373 $7,976 
(1) Current operating lease liabilities are classified in accrued liabilities on the Company’s condensed consolidated balance sheets.
During the six months ended February 29, 2024, the Company entered into a finance lease for a blending facility (the “Finance Lease”). As of August 31, 2023, the Company had $3.8 million of prepaid deposits, which converted to a right-of-use asset at the commencement of the Finance Lease during the six months ended February 29, 2024. Since the Finance Lease was fully prepaid at commencement, no lease liability exists related to it.
12

Note 7.    Accrued and Other Liabilities
Accrued liabilities consisted of the following (in thousands):
February 29,
2024
August 31,
2023
Accrued advertising and sales promotion expenses$15,671 $14,472 
Accrued professional services fees2,792 1,924 
Accrued sales taxes and other taxes2,981 2,618 
Deferred revenue3,340 4,552 
Short-term operating lease liability1,864 2,144 
Other5,062 4,290 
Total$31,710 $30,000 
Accrued payroll and related expenses consisted of the following (in thousands):
February 29,
2024
August 31,
2023
Accrued incentive compensation$5,844 $6,698 
Accrued payroll5,441 4,298 
Accrued payroll taxes1,665 1,650 
Accrued profit sharing1,406 3,561 
Other513 515 
Total$14,869 $16,722 
Note 8.    Debt
As of February 29, 2024, the Company held borrowings under two separate agreements as detailed below.
Note Purchase and Private Shelf Agreement
The Company holds borrowings under its Note Purchase and Private Shelf Agreement, as amended (the “Note Agreement”) by and among the Company, PGIM, Inc. (“Prudential”), and certain affiliates and managed accounts of Prudential (the “Note Purchasers”). As of February 29, 2024, the Company had outstanding balances on its series A, B and C notes issued under this Note Agreement.
Credit Agreement
The Company’s Amended and Restated Credit Agreement, as amended (the “Credit Agreement”) with Bank of America, N.A. consists of a revolving commitment for borrowing by the Company up to $150.0 million with a sublimit of $100.0 million for WD-40 Company Limited, a wholly owned operating subsidiary of the Company for Europe, India, the Middle East and Africa.
On November 29, 2021, the Company entered into its most recent amendment to the Credit Agreement (the “LIBOR Amendment”) with Bank of America, N.A. The LIBOR Amendment changed the Company’s index rates under the Credit Agreement for Pound Sterling and U.S. Dollar borrowings from the London Interbank Offered Rate as administered by ICE Benchmark Administration to the Sterling Overnight Index Average Reference Rate and the Bloomberg Short-term Bank Yield Index rate, respectively, as well as certain definitions and clarifications within the Credit Agreement to accommodate the change in index rates. The impact of the LIBOR Amendment was insignificant to the Company’s consolidated financial statements.
13

Short-term and long-term borrowings under the Company’s Credit Agreement and Note Agreement consisted of the following (in thousands):
IssuanceMaturitiesFebruary 29,
2024
August 31,
2023
Credit Agreement – revolving credit facility (1)
Various9/30/2025$48,484 $52,943 
Note Agreement
Series A Notes – 3.39% fixed rate(2)
11/15/2017
2024-2032
15,200 15,600 
Series B Notes – 2.50% fixed rate(3)
9/30/202011/15/202726,000 26,000 
Series C Notes – 2.69% fixed rate(3)
9/30/202011/15/203026,000 26,000 
Total borrowings115,684 120,543 
Short-term portion of borrowings(29,790)(10,800)
Total long-term borrowings$85,894 $109,743 
(1)The Company has the ability to refinance any draw under the line of credit with successive short-term borrowings through the maturity date. Outstanding draws for which management has the ability and intent to refinance with successive short-term borrowings for a period of at least twelve months are classified as long-term. As of February 29, 2024, $19.5 million of this facility was classified as long-term and was entirely denominated in Euros. $29.0 million was classified as short-term and was denominated in U.S. Dollars and Pounds Sterling. As of August 31, 2023, $42.9 million on this facility was classified as long-term and was denominated in Euros and Pounds Sterling. $10.0 million was classified as short-term and was denominated entirely in U.S. Dollars. Euro and Pound Sterling denominated draws fluctuate in U.S. Dollars from period to period due to changes in foreign currency exchange rates.
(2)Principal payments are required semi-annually in May and November of each year in equal installments of $0.4 million through May 15, 2032, resulting in $0.8 million classified as short-term. The remaining outstanding principal in the amount of $8.4 million will become due on November 15, 2032.
(3)Interest on notes is payable semi-annually in May and November of each year with no principal due until the maturity date.
Both the Note Agreement and the Credit Agreement contain representations, warranties, events of default and remedies, as well as affirmative, negative and other financial covenants customary for these types of agreements. These covenants include, among other things, certain limitations on the ability of the Company and its subsidiaries to incur indebtedness, create liens, dispose of assets, make investments, declare, make or incur obligations to make certain restricted payments, including payments for the repurchase of the Company’s capital stock and enter into certain merger or consolidation transactions. The Credit Agreement includes, among other limitations on indebtedness, a $125.0 million limit on other unsecured indebtedness.
Each agreement also includes a most favored lender provision which requires that any time any other lender has the benefit of one or more financial or operational covenants that is different than, or similar to, but more restrictive than those contained in its own agreement, those covenants shall be immediately and automatically incorporated by reference to the other lender’s agreement. Both the Note Agreement and the Credit Agreement require the Company to adhere to the same financial covenants. For the financial covenants, the definition of consolidated EBITDA includes the add back of non-cash stock-based compensation to consolidated net income when arriving at consolidated EBITDA. The terms of the financial covenants are as follows:
The consolidated leverage ratio cannot be greater than three and a half to one. The consolidated leverage ratio means, as of any date of determination, the ratio of (a) consolidated funded indebtedness as of such date to (b) consolidated EBITDA for the most recently completed four fiscal quarters.
The consolidated interest coverage ratio cannot be less than three to one. The consolidated interest coverage ratio means, as of any date of determination, the ratio of (a) consolidated EBITDA for the most recently completed four fiscal quarters to (b) consolidated interest charges for the most recently completed four fiscal quarters.
As of February 29, 2024, the Company was in compliance with all debt covenants under both the Note Agreement and the Credit Agreement.
14

Note 9.    Share Repurchase Plan
On June 19, 2023, the Company’s Board (the “Board”) approved a share repurchase plan (the “2023 Repurchase Plan”). Under the 2023 Repurchase Plan, which became effective on September 1, 2023, the Company is authorized to acquire up to $50.0 million of its outstanding shares through August 31, 2025. The timing and amount of repurchases are based on terms and conditions as may be acceptable to the Company’s Chief Executive Officer and Chief Financial Officer, subject to present loan covenants and in compliance with all laws and regulations applicable thereto. During the six months ended February 29, 2024, the Company repurchased 23,000 shares at an average price of $231.26 per share, for a total cost of $5.3 million under this $50.0 million plan.
Note 10.    Earnings per Common Share
The table below reconciles net income to net income available to common stockholders (in thousands):
Three Months Ended February 29/28,Six Months Ended February 29/28,
2024202320242023
Net income$15,536 $16,526 $33,018 $30,523 
Less: Net income allocated to participating securities(56)(71)(122)(125)
Net income available to common stockholders$15,480 $16,455 $32,896 $30,398 
The table below summarizes the weighted-average number of common shares outstanding included in the calculation of basic and diluted EPS (in thousands):
Three Months Ended February 29/28,Six Months Ended February 29/28,
2024202320242023
Weighted-average common shares outstanding, basic13,558 13,583 13,559 13,586 
Weighted-average dilutive securities25 25 24 22 
Weighted-average common shares outstanding, diluted13,583 13,608 13,583 13,608 
For the three months ended February 29, 2024, there were no anti-dilutive stock-based equity awards outstanding. For the six months ended February 29, 2024, weighted-average stock-based equity awards outstanding that are non-participating securities in the amount of 2,702 were excluded from the calculation of diluted EPS under the treasury stock method as they were anti-dilutive.
For the three and six months ended February 28, 2023, weighted-average stock-based equity awards outstanding that are non-participating securities in the amount of 10,734 and 9,103, respectively, were excluded from the calculation of diluted EPS under the treasury stock method as they were anti-dilutive.
15

Note 11.    Revenue
The following table presents the Company’s revenues by segment and major source (in thousands):
Three Months Ended February 29, 2024Six Months Ended February 29, 2024
AmericasEIMEAAsia-PacificTotalAmericasEIMEAAsia-PacificTotal
WD-40 Multi-Use Product$49,043 $41,572 $16,619 $107,234 $97,554 $78,616 $38,741 $214,911 
WD-40 Specialist7,090 7,525 2,202 16,817 14,198 14,191 5,270 33,659 
Other maintenance products (1)
4,003 3,009 176 7,188 8,129 6,071 614 14,814 
Total maintenance products60,136 52,106 $18,997 $131,239 119,881 98,878 44,625 263,384 
HCCP (2)
3,371 2,207 2,288 7,866 7,701 4,189 4,247 16,137 
Total net sales$63,507 $54,313 $21,285 $139,105 $127,582 $103,067 $48,872 $279,521 
Three Months Ended February 28, 2023Six Months Ended February 28, 2023
AmericasEIMEAAsia-PacificTotalAmericasEIMEAAsia-PacificTotal
WD-40 Multi-Use Product$48,405 $35,660 $16,196 $100,261 $91,562 $65,838 $37,449 $194,849 
WD-40 Specialist$6,875 $6,122 $2,277 $15,274 13,700 12,133 4,847 30,680 
Other maintenance products (1)
$3,846 $2,569 $154 $6,569 7,435 5,109 343 12,887 
Total maintenance products$59,126 $44,351 $18,627 $122,104 112,697 83,080 42,639 238,416 
HCCP (2)
3,764 2,458 1,867 8,089 8,207 4,501 3,962 16,670 
Total net sales$62,890 $46,809 $20,494 $130,193 $120,904 $87,581 $46,601 $255,086 
(1)Other maintenance products consist of the 3-IN-ONE and GT85 brands.
(2)Homecare and cleaning products (“HCCP”).
Contract Balances
Contract liabilities consist of deferred revenue related to undelivered products. Deferred revenue is recorded when payments have been received from customers for undelivered products. Revenue is subsequently recognized when revenue recognition criteria are met, generally when control of the product transfers to the customer. The Company had contract liabilities of $3.3 million and $4.6 million as of February 29, 2024 and August 31, 2023, respectively. Substantially all of the $4.6 million that was included in contract liabilities as of August 31, 2023 was recognized to revenue during the six months ended February 29, 2024. These contract liabilities are recorded in accrued liabilities on the Company’s condensed consolidated balance sheets. Contract assets are recorded if the Company has satisfied a performance obligation but does not yet have an unconditional right to consideration. The Company did not have any contract assets as of February 29, 2024 and August 31, 2023. The Company has an unconditional right to payment for its trade and other accounts receivable on the Company’s condensed consolidated balance sheets. These receivables are presented net of an allowance for credit losses of $0.6 million as of February 29, 2024 and which was not significant as of August 31, 2023.
Note 12.    Commitments and Contingencies
Purchase Commitments
The Company has ongoing relationships with various suppliers (contract manufacturers) that manufacture the Company’s products and third-party distribution centers that warehouse and ship the Company’s products to customers. The contract manufacturers maintain title and control of certain raw materials and components, materials utilized in finished products, and the finished products themselves until shipment to the Company’s third-party distribution centers or customers in accordance with agreed upon shipment terms. Although the Company has contractual minimum purchase obligations with certain contract manufacturers, such obligations are either immaterial or below the volume of goods that the Company has historically purchased. In the ordinary course of business, supply needs are communicated by the Company to its contract manufacturers based on orders and short-term projections, ranging from two months to six months. The Company is committed to purchase the products produced by the contract manufacturers based on the projections provided.
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Upon the termination of contracts with contract manufacturers, the Company obtains certain inventory control rights and is obligated to work with the contract manufacturer to sell through all product held by or manufactured by the contract manufacturer on behalf of the Company during the termination notification period. If any inventory remains at the contract manufacturer at the termination date, the Company is obligated to purchase such inventory, which may include raw materials, components and finished goods. The amounts for inventory purchased under termination commitments have been immaterial.
In addition to the commitments to purchase products from contract manufacturers described above, the Company may also enter into commitments with other manufacturers to purchase finished goods and components to support innovation and renovation initiatives and/or supply chain initiatives. As of February 29, 2024, no such commitments were outstanding.
Litigation
From time to time, the Company is subject to various claims, lawsuits, investigations and proceedings arising in the ordinary course of business, including but not limited to, product liability litigation and other claims and proceedings with respect to intellectual property, breach of contract, labor and employment, tax and other matters. As of February 29, 2024, there were no unasserted claims or pending proceedings for claims against the Company that the Company believes will result in a probable loss. As to claims that the Company believes may result in a reasonably possible loss, the Company believes that no reasonably possible outcome of any such claim will have a materially adverse impact on the Company’s financial condition, results of operations or cash flows.
Indemnifications
As permitted under Delaware law, the Company has agreements whereby it indemnifies senior officers and directors for certain events or occurrences while the officer or director is, or was, serving at the Company’s request in such capacity. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company maintains Director and Officer insurance coverage that mitigates the Company’s exposure with respect to such obligations. As a result of the Company’s insurance coverage, management believes that the estimated fair value of these indemnification agreements is minimal. Thus, no liabilities have been recorded for these agreements as of February 29, 2024.
From time to time, the Company enters into indemnification agreements with certain contractual parties in the ordinary course of business, including agreements with lenders, lessors, contract manufacturers, marketing distributors, customers and certain vendors. All such indemnification agreements are entered into in the context of the particular agreements and are provided in an attempt to allocate risk of loss in connection with the consummation of the underlying contractual arrangements. Although the maximum amount of future payments that the Company could be required to make under these indemnification agreements is unlimited, management believes that the Company maintains adequate levels of insurance coverage to protect the Company with respect to most potential claims arising from such agreements and that such agreements do not otherwise have value separate and apart from the liabilities incurred in the ordinary course of the Company’s business. Thus, no liabilities have been recorded with respect to such indemnification agreements as of February 29, 2024.
Note 13.    Income Taxes
The Company uses an estimated annual effective tax rate, which is based on expected annual income, statutory tax rates and tax planning opportunities available in the various jurisdictions in which the Company operates, to determine its quarterly provision for income taxes. Certain significant or unusual items are separately recognized in the quarter in which they occur and can be a source of variability in the effective tax rates from quarter to quarter.
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The provision for income taxes was 21.6% and 20.8% of income before income taxes for the three months ended February 29, 2024 and February 28, 2023, respectively. This 0.8% increase in the effective tax rate from period to period was primarily due to the following impacts:
Description of impacts on the Company’s estimated annual effective tax rate
Unfavorable/(Favorable)
Higher tax rates in certain foreign jurisdictions from period to period
1.7%
An increase in non-deductible performance based compensation
0.7%
Windfalls from the settlement of stock-based equity awards in the second quarter of fiscal year 2024
(0.8)%
Benefits related to income tax positions affected by expiring statutes of limitation
(0.6)%
The provision for income taxes was 23.0% and 20.9% of income before income taxes for the six months ended February 29, 2024 and February 28, 2023, respectively. This 2.1% increase in the effective tax rate from period to period was primarily due to the following impacts:
Description of impacts on the Company’s estimated annual effective tax rate
Unfavorable/(Favorable)
A non-recurring charitable donation made in the first quarter of fiscal year 2023
1.9%
Higher tax rates in certain foreign jurisdictions from period to period
1.4%
Lower year to date shortfalls from the settlements of stock-based equity awards in fiscal year 2024
(1.3)%
The Company is subject to taxation in the U.S. and in various state and foreign jurisdictions. Due to expired statutes, the Company’s federal income tax returns for years prior to fiscal year 2018 are not subject to examination by the U.S. Internal Revenue Service. Generally, for the majority of state and foreign jurisdictions where the Company does business, periods prior to fiscal year 2020 are no longer subject to examination. The Company is currently under audit in various state jurisdictions for fiscal years 2021 through 2022. The Company has estimated that up to $12.4 million of unrecognized tax benefits related to income tax positions may be affected by the resolution of tax examinations or expiring statutes of limitation within the next twelve months. This includes $12.1 million associated with the Tax Cuts and Jobs Act’s mandatory one-time “toll tax” on unremitted foreign earnings. Audit outcomes and the timing of settlements are subject to significant uncertainty.
Note 14.    Business Segments and Foreign Operations
The Company evaluates the performance of its segments and allocates resources to them based on sales and income from operations. The Company is organized on the basis of geographical area into the following three segments: the Americas; EIMEA; and Asia-Pacific. Segment data does not include inter-segment revenues. Unallocated corporate expenses are general corporate overhead expenses not directly attributable to the business segments and are reported separate from the Company’s identified segments. Corporate overhead costs include expenses for the Company’s accounting and finance, information technology, human resources, research and development, quality control and executive management functions, as well as all direct costs associated with public company compliance matters including legal, audit and other professional services costs.
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Summary information about reportable segments is as follows (in thousands):
For the Three Months EndedAmericasEIMEAAsia-Pacific
Unallocated
Corporate (1)
Total
February 29, 2024
Net sales$63,507 $54,313 $21,285 $- $139,105 
Income from operations$13,220 $12,087 $7,489 $(11,855)$20,941 
Depreciation and amortization expense (2)
$1,144 $1,150 $56 $72 $2,422 
Interest income$- $36 $30 $- $66 
Interest expense$505 $502 $1 $- $1,008 
February 28, 2023
Net sales$62,890 $46,809 $20,494 $- $130,193 
Income from operations$13,712 $10,383 $7,023 $(8,965)$22,153 
Depreciation and amortization expense (2)
$869 $973 $51 $75 $1,968 
Interest income$- $26 $25 $- $51 
Interest expense$1,087 $413 $2 $- $1,502 
For the Six Months Ended
February 29, 2024
Net sales$127,582 $103,067 $48,872 $- $279,521 
Income from operations$27,416 $21,602 $18,514 $(22,407)$45,125 
Depreciation and amortization expense (2)
$2,195 $2,224 $113 $151 $4,683 
Interest income$- $82 $58 $- $140 
Interest expense$1,065 $1,086 $3 $- $2,154 
February 28, 2023
Net sales$120,904 $87,581 $46,601 $- $255,086 
Income from operations$26,484 $16,666 $16,640 $(18,958)$40,832 
Depreciation and amortization expense (2)
$1,747 $1,870 $96 $151 $3,864 
Interest income$4 $35 $56 $- $95 
Interest expense$1,977 $692 $2 $- $2,671 
(1)These expenses are reported separately from the Company’s identified segments and are included in selling, general and administrative expenses in the Company’s condensed consolidated statements of operations.
(2)Amortization presented above includes amortization of definite-lived intangible assets and excludes amortization of implementation costs associated with cloud computing arrangements.
The Company’s Chief Operating Decision Maker does not review assets by segment as part of the financial information provided, and therefore, no asset information is provided in the above table.
Note 15.    Subsequent Events
Acquisition of Theron Marketing
On March 4, 2024, the Company acquired a Brazilian marketing distributor, Theron Marketing Ltda. (“Theron”). Theron had been the exclusive distributor of WD-40 Brand products in Brazil for the last 27 years. Pursuant to the terms of the transaction, WD-40 Holding Company Brasil Ltda., a wholly owned subsidiary of the Company established during the three months ended February 29, 2024, acquired all outstanding shares of capital stock of Theron for cash of approximately
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$6.9 million (subject to a 90-day post closing adjustment). With this transaction, the Company began direct distribution within Brazil in March 2024.
Dividend Declaration
On March 19, 2024, the Company’s Board declared a cash dividend of $0.88 per share payable on April 30, 2024 to stockholders of record on April 19, 2024.
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Item 2.    Management’s Discussion and Analysis of Financial Condition and Results of Operations

As used in this report, the terms “we,” “our,” and “us” and “the Company” refer to WD-40 Company and its wholly-owned subsidiaries, unless the context suggests otherwise. Amounts and percentages in tables and discussions may not total due to rounding.
The following information is provided as a supplement to, and should be read in conjunction with, the unaudited condensed consolidated financial statements and notes thereto included in Part I—Item 1 of this Quarterly Report and the audited consolidated financial statements and notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the fiscal year ended August 31, 2023, which was filed with the Securities and Exchange Commission (“SEC”) on October 23, 2023.
Use of Non-GAAP Constant Currency
In order to show the impact of changes in foreign currency exchange rates on our results of operations, we have included constant currency disclosures, where necessary, in the Overview and Results of Operations sections which follow. Constant currency disclosures represent the translation of our current fiscal year revenues, expenses and net income from the functional currencies of our subsidiaries to U.S. Dollars using the exchange rates in effect for the corresponding period of the prior fiscal year. Results on a constant currency basis are not in accordance with accounting principles generally accepted in the United States of America (“non-GAAP”) and should be considered in addition to, not as a substitute for, results prepared in accordance with U.S. GAAP. We use results on a constant currency basis as one of the measures to understand our operating results and evaluate our performance in comparison to prior periods in order to enhance the visibility of the underlying business trends, excluding the impact of translation arising from foreign currency exchange rate fluctuations. Management believes this non-GAAP financial measure provides investors with additional financial information that should be considered when assessing our underlying business performance and trends. However, reference to constant currency basis should not be considered in isolation or as a substitute for other financial measures calculated and presented in accordance with U.S. GAAP.
Forward-Looking Statements
The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for certain forward-looking statements. This report contains forward-looking statements, which reflect our current views with respect to future events and financial performance. These forward-looking statements are generally identified with words such as “believe,” “expect,” “intend,” “plan,” “project,” “could,” “may,” “aim,” “anticipate,” “target,” “estimate” and similar expressions.
These forward-looking statements include, but are not limited to, discussions about future financial and operating results, including: growth expectations for maintenance products; expected levels of promotional and advertising spending; anticipated input costs for manufacturing and the costs associated with distribution of our products; plans for and success of product innovation, the impact of new product introductions on the growth of sales; anticipated results from product line extension sales; expected tax rates and the impact of tax legislation and regulatory action; changes in the political conditions or relations between the United States and other nations; the impacts from inflationary trends and supply chain constraints; changes in interest rates; and forecasted foreign currency exchange rates and commodity prices. We undertake no obligation to revise or update any forward-looking statements.
Actual events or results may differ materially from those projected in forward-looking statements due to various factors, including, but not limited to, those identified in Part I—Item 1A, “Risk Factors,” in our Annual Report on Form 10-K for the fiscal year ended August 31, 2023, and in Part II—Item 1A, “Risk Factors” of this Quarterly Report on Form 10-Q.
Overview
The Company
WD-40 Company based in San Diego, California, is a global marketing organization dedicated to creating positive lasting memories by developing and selling products that solve problems in workshops, factories and homes around the world. We own a wide range of well-known brands that include maintenance products and homecare and cleaning products: WD-40® Multi-Use Product, WD-40 Specialist®, 3-IN-ONE®, GT85®, X-14®, 2000 Flushes®, Carpet Fresh®, no vac®, Spot Shot®, 1001®, Lava® and Solvol®.
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Our products are sold in various locations around the world. Maintenance products are sold worldwide in markets throughout North, Central and South America, Asia, Australia, Europe, India, the Middle East and Africa. Homecare and cleaning products are sold primarily in North America, the United Kingdom (“U.K.”) and Australia. We sell our products primarily through hardware stores, automotive parts outlets, industrial distributors and suppliers, mass retail and home center stores, value retailers, grocery stores, online retailers, warehouse club stores, farm supply, sport retailers, and independent bike dealers.
Highlights
The following summarizes the financial and operational highlights for our business during the six months ended February 29, 2024:
Consolidated net sales increased $24.4 million, or 10%, compared to the corresponding period of the prior fiscal year. Increases in sales volume favorably impacted net sales by approximately $9.9 million from period to period. Increases in the average selling price of our products positively impacted net sales by approximately $7.7 million from period to period, primarily due to sales price increases implemented in certain regions during the prior fiscal year. Changes to net sales attributable to volumes and average selling price of our products are impacted by differences in sales mix related to products, markets and distribution channels from period to period. In addition, changes in foreign currency exchange rates from period to period had a favorable impact of $6.8 million on consolidated net sales for the first three months of fiscal year 2024. On a constant currency basis, net sales would have increased by $17.6 million, or 7%, from period to period. This favorable impact from changes in foreign currency exchange rates mainly came from our EIMEA segment, which accounted for 37% of our consolidated sales for the six months ended February 29, 2024.
Gross profit as a percentage of net sales increased to 53.1% compared to 51.1% for the corresponding period of the prior fiscal year.
Consolidated net income increased $2.5 million, or 8%, compared to the corresponding period of the prior fiscal year. Changes in foreign currency exchange rates from period to period had a favorable impact of $1.2 million on consolidated net income for the first half of fiscal year 2024. Thus, on a constant currency basis, net income would have increased $1.3 million, or 4%, from period to period.
Diluted earnings per common share were $2.42 versus $2.23 in the prior fiscal year period.
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Results of Operations
Three and Six Months Ended February 29, 2024 Compared to Three and Six Months Ended February 28, 2023
Operating Items
The following table summarizes operating data for our consolidated operations (in thousands, except percentages and per share amounts):
Three Months Ended February 29/28,Six Months Ended February 29/28,
20242023Change from
Prior Year
20242023Change from
Prior Year
DollarsPercentDollarsPercent
Net sales:
WD-40 Multi-Use Product107,234 100,261 6,973 %$214,911 $194,849 $20,062 10 %
WD-40 Specialist16,817 15,274 1,543 10 %33,659 30,680 2,979 10 %
Other maintenance products7,188 6,569 619 %14,814 12,887 1,927 15 %
Total maintenance products131,239 122,104 9,135 %263,384 238,416 24,968 10 %
HCCP (1)
7,866 8,089 (223)(3)%16,137 16,670 (533)(3)%
Total net sales139,105 130,193 8,912 %279,521 255,086 24,435 10 %
Cost of products sold66,164 64,115 2,049 %131,027 124,753 6,274 %
Gross profit72,941 66,078 6,863 10 %148,494 130,333 18,161 14 %
Operating expenses52,000 43,925 8,075 18 %103,369 89,501 13,868 15 %
Income from operations$20,941 $22,153 $(1,212)(5)%$45,125 $40,832 $4,293 11 %
Net income$15,536 $16,526 $(990)(6)%$33,018 $30,523 $2,495 %
EPS – diluted$1.14 $1.21 $(0.07)(6)%$2.42 $2.23 $0.19 %
Shares used in diluted EPS13,58313,608(25)%13,583 13,608 (25)%
(1)Homecare and cleaning products (“HCCP”)
Net Sales by Segment
The following table summarizes net sales by segment (in thousands, except percentages):
Three Months Ended February 29/28,Six Months Ended February 29/28,
20242023Change from
Prior Year
20242023Change from
Prior Year
DollarsPercentDollarsPercent
Americas$63,507 $62,890 $617 %$127,582 $120,904 $6,678 %
EIMEA54,313 46,809 7,504 16 %103,067 87,581 15,486 18 %
Asia-Pacific21,285 20,494 791 %48,872 46,601 2,271 %
Total$139,105 $130,193 $8,912 %$279,521 $255,086 $24,435 10 %
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Americas Sales
The following table summarizes net sales by product line for the Americas segment, which includes the U.S., Canada and Latin America (in thousands, except percentages):
Three Months Ended February 29/28,Six Months Ended February 29/28,
20242023Change from
Prior Year
20242023Change from
Prior Year
DollarsPercentDollarsPercent
WD-40 Multi-Use Product$49,043 $48,405 $638 %$97,554 $91,562 $5,992 %
WD-40 Specialist7,090 6,875 215 %14,198 13,700 498 %
Other maintenance products4,003 3,846 157 %8,129 7,435 694 %
Total maintenance products60,136 59,126 1,010 %119,881 112,697 7,184 %
HCCP3,371 3,764 (393)(10)%7,701 8,207 (506)(6)%
Total net sales$63,507 $62,890 $617 %$127,582 $120,904 $6,678 %
% of consolidated net sales46 %48 %46 %48 %
CC Net sales – non-GAAP (1)
$62,779 $62,890 $(111)%$126,128 $120,904 $5,224 %
Currency impact on current period – non-GAAP$728 $1,454 
(1)Current fiscal year constant currency (“CC”) net sales translated at the foreign currency exchange rates in effect for the corresponding period of the prior fiscal year, compared to prior period actual net sales.
The following table summarizes management’s estimates of effects on net sales of changes in price, volume and foreign currency exchange rate impacts for the Americas segment (in millions):
Change from Prior Year
First QuarterSecond QuarterYear to Date
Increase in average selling price(1)
$1.8 $2.2 $4.0 
Increase (decrease) in sales volume(1)
3.6 (2.4)1.2 
Currency impact on current period – non-GAAP0.7 0.8 1.5 
Increase in net sales$6.1 $0.6 $6.7 
(1)Management’s estimates of changes in net sales attributable to volumes and the average selling price of our products are impacted by differences in sales mix related to products, markets and distribution channels from period to period.
Americas Sales – Three Months Ended – February 29, 2024 Compared to February 28, 2023
Net sales in the Americas segment increased due to the following:
WD-40 Multi-Use Product sales increased $0.6 million, or 1%, primarily due to increases in Latin America and the U.S. of $1.1 million and $0.7 million, or 12% and 2%, respectively, partially offset by decreases in Canada of $1.2 million, or 35%. The increased sales in Latin America were primarily due to the favorable impact of price increases and higher volumes in Mexico as a result of the timing of customer orders, as well as the favorable impacts of changes in foreign currency exchange rates. The decrease in sales in Canada was primarily due to the timing of promotional activities and customer orders period over period.
WD-40 Specialist and other maintenance product sales slightly increased across most regions in the Americas.
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Homecare and cleaning product sales decreased $0.4 million, or 10%, primarily due to lower volume in the U.S. as a result of reduced demand.
For both the three months ended February 29, 2024 and February 28, 2023, 76% of sales came from the U.S., and 24% of sales came from Canada and Latin America combined.
Americas Sales – Six Months Ended – February 29, 2024 Compared to February 28, 2023
Net sales in the Americas segment increased due to the following:
WD-40 Multi-Use Product sales increased $6.0 million, or 7%, primarily due to increases in Latin America and the U.S. of $3.5 million and $3.2 million, or 20% and 5%, respectively. In Latin America, sales in the first half of fiscal year 2024 were favorably impacted by higher volumes as the result of timing of customer orders. This favorable impact was due to reduced demand in the comparative period as a result of customers that purchased higher levels of our product at the end of fiscal year 2022 in anticipation of price increases. In addition, sales in Mexico increased due to higher volumes as a result of timing of customer orders and favorable impacts of changes in foreign exchange rates. The increase in the U.S. was due to a combination of recovering volumes at increased selling prices as well as a result of successful promotional programs.
WD-40 Specialist sales slightly increased across most regions in the Americas.
Other maintenance product sales increased due to a $0.7 million, or 9%, increase in 3-IN-ONE sales, primarily due to successful promotional programs in Mexico and Canada.
Homecare and cleaning product sales decreased $0.5 million, or 6%, primarily due to lower volume in the U.S. as a result of reduced demand.
For the six months ended February 29, 2024, 75% of sales came from the U.S., and 25% of sales came from Canada and Latin America combined compared to the six months ended February 28, 2023 when 77% of sales came from the U.S., and 23% of sales came from Canada and Latin America.
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EIMEA Sales
The following table summarizes net sales by product line for the EIMEA segment, which includes Europe, India, the Middle East and Africa (in thousands, except percentages):
Three Months Ended February 29/28,Six Months Ended February 29/28,
20242023Change from
Prior Year
20242023Change from
Prior Year
DollarsPercentDollarsPercent
WD-40 Multi-Use Product41,572 35,660 5,912 17 %$78,616 $65,838 $12,778 19 %
WD-40 Specialist7,525 6,122 1,403 23 %14,191 12,133 2,058 17 %
Other maintenance products3,009 2,569 440 17 %6,071 5,109 962 19 %
Total maintenance products52,106 44,351 7,755 17