What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2023-10-23 compared with 2022-10-24 · 70 added, 66 removed, 100 unchanged (58% of the section changed)

8 unchanged sentences

Homecare and cleaning products are sold primarily in North America, the United Kingdom (“U.K.”) and Australia.

Our strategic initiatives are the areas where we will continue to focus our time, talent and resources in future periods.

Our strategic initiatives include:

(i) building a business for the future;

(ii) attracting, developing and engaging outstanding tribe members;

(iii) striving for operational excellence;

(iv) growing WD-40 Multi-Use Product;

(v) growing WD-40 Specialist product line;

(vi) expanding and supporting portfolio opportunities that help us grow .

Our top priority is to build an enduring business that we will be proud to pass onto the next generation by using our purpose and values as a decision-making filter.

Our desired outcome for this top strategic initiative is to further align and integrate our business decisions with Environmental, Social, and Governance (“ESG”) factors and considerations.

We understand that we cannot achieve this without attracting, developing and engaging outstanding people, whom we refer to collectively as a tribe, that strive for operational excellence daily.

The principal driver of our growth continues to be taking the blue and yellow can with the little red top, to new users in global markets.

We are currently conducting a strategic review regarding the future of our homecare and cleaning products.

The principal driver of our sales growth is focused on our maintenance products and making them available in more places, for more people, who will find more uses, more frequently.

Our future is guided by a long-term four-by-four strategic framework tied to our purpose and our values.

There are two main elements of our strategic framework.

The first element of our four-by-four strategic framework, which we refer to as our Must-Win Battles, focuses on increasing sales of our maintenance products.

Our Must-Win Battles include:

growing WD-40 Multi-Use Product sales through geographic expansion;

growing sales and gross margin through the premiumization of WD-40 Multi-Use Product;

growing the WD-40 Specialist ® product line through category leadership;

accelerating our capabilities in building our brand digitally and maximizing our global digital commerce presence.

The second element of our four-by-four strategic framework, which we refer to as our Strategic Enablers, focuses on operational excellence.

Our Strategic Enablers include:

ensuring a people-first mindset where we can attract, develop and engage outstanding employees;

building a sustainable business for the future;

achieving operational excellence in supply chain;

driving productivity via enhanced systems.

These make up our four-by-four strategic framework and are where we will continue to focus our time, talent and resources.

We continue to be focused and committed to innovation and renovation of our products.

We see innovation and renovation as important factors to the long-term growth of our brands and product lines, and intend to continue to work on future products, product lines, product packaging, and product delivery systems, as well as promotional innovations and renovations in order to expand our product portfolio to help us grow.

We are also focused on expanding our current brands in existing markets with new product development.

Our product development teams support new product development and current product improvement for our brands.

Our research and development team supports new product development and current product improvement for our brands.

Over the years, our research and development team has made an impact on most of our brands through our innovation activities.

Key innovations for our products include, but are not limited to, WD-40 EZ-Reach ® Flexible Straw, WD-40 Smart Straw ® , WD-40 Trigger Pro ® , WD-40 Specialist ® , WD-40 BIKE ® , 3-IN-ONE RVcare ® and 3-IN-ONE ® Professional Garage Door Lube.

Our homecare and cleaning products, particularly those in the U.S., are considered harvest brands which continue to provide positive returns, but are becoming a smaller part of the business as sales of the maintenance products grow with the execution of our strategic initiatives.

Although we have evaluated strategic alternatives for certain of our homecare and cleaning products, particularly those in the U.S., we have continued to sell products within these brands but with a reduced level of marketing investment.

Key innovations for our products include, but are not limited to, WD-40 EZ-Reach ® Flexible Straw, WD-40 Smart Straw ® , WD-40 Trigger Pro ® , WD-40 Specialist ® , WD-40 Specialist ® Degreaser & Cleaner EZ-Pods, WD-40 ® Precision Pen, WD-40 BIKE ® , 3-IN-ONE RVcare ® and 3-IN-ONE ® Professional Garage Door Lube.

Our homecare and cleaning products, particularly those in the U.S.

and the U.K., are considered harvest brands which continue to provide positive returns but are becoming a smaller part of the business as sales of the maintenance products grow with the execution of our four Must Win Battles within our strategic framework.

We are exploring options to further de-emphasize our homecare and cleaning brands, particularly those in the U.S.

De-emphasizing these brands over time will create opportunities for our workforce to bring an even greater focus to our higher margin maintenance products.

Although we are evaluating strategic alternatives for certain of our homecare and cleaning products we have continued to sell products within these brands but with a reduced level of marketing investment.

Human Capital Resources

Our success is the result of the engagement and commitment of our people, whom we refer to as tribe members.

We believe that a tribe is a group of people who come together to feed and defend one another in order to fulfill a common purpose.

Our purpose can only be achieved with the efforts of our 583 tribe members who create positive lasting memories for our stakeholders, including our end users as they work to ensure that our products solve problems in factories, workshops, and homes around the world.

Our purpose can only be achieved with the efforts of our 613 employees who create positive lasting memories for our stakeholders, including end users of our products who solve problems in factories, workshops, and homes around the world.

Our workforce is distributed globally in 17 countries, with approximately 36% in the Americas, 42% in EMEA, 14% in Asia-Pacific, and 8% corporate employees.

Women make up approximately 46% of our global tribe.

The average tenure of our global tribe is 8 years.

A foundational strategic initiative is to attract, develop and engage outstanding tribe members.

We believe that our ability to attract, develop, engage, and retain outstanding tribe members is the result of our inclusive, purpose-driven, learning focused and values guided culture.

This strategic initiative guides our commitment to develop tribe members throughout the organization.

One of the primary responsibilities of our leaders, whom we refer to as coaches, is to tailor individual development plans to support the needs of our tribe members to achieve their performance goals.

We also offer various internal training programs to our tribe members and encourage attendance at external training programs that allow tribe members to grow from both a technical and leadership standpoint.

As a result of the culture we have nurtured and evolved, we have increased employee engagement over time while expanding the size of our tribe to support our growing business.

Our most recent biennial global employee engagement survey, which was conducted in January 2022 by an independent third-party, resulted in a very high employee engagement level of 93%.

Consistently living our company values grants each of us the freedom and agility to make autonomous decisions yet remain aligned as we act in the best interest of all our stakeholders across the globe.

Our approach to diversity and inclusion focuses on what unites us:

a common purpose as a tribe.

Our diverse global tribe, hired primarily within local markets, contains an array of talent and experiences, work collaboratively to solve problems and bring meaning to our work life.

Our tribe is comprised of talented and dedicated members, many of whom work together with their international peers in the areas of :

marketing, sales, customer service, finance and accounting, legal, information technology, human resources, supply chain and logistics, innovation, R&D, quality, and other technical fields.

We believe our culture is a competitive advantage, and we prioritize it as such.

Understanding the views, perspectives and experiences of our end-users and tribe members is foundational in maintaining and growing the WD-40 Company brand and business.

Our language, norms, artifacts, and traditions result in psychological safety, learning, and goal achievement.

This includes a total rewards strategy that ensures each tribe member can sustain their well-being today and into the future.

The recent and ongoing global pandemic has reinforced the importance of our priority to maintain the safety, health, and well-being of every tribe member.

During various stages of the COVID-19 pandemic, much of our workforce worked remotely, in accordance with public health and safety guidance.

The pandemic inspired us to launch what we call “Work from Where”, a philosophy to support the work-life integration of our global tribe members.

This “Work from Where” philosophy enables our coaches and tribe members to align on where work is completed.

Women make up approximately 44% of our global workforce.

The average tenure of our global workforce is eight years.

A strategic enabler of our business is to be an employer of choice with a people-first mindset.

This competitive advantage enables us to attract, develop and engage outstanding employees.

One of the primary responsibilities of our leaders, whom we refer to as coaches, is to support the development needs of our employees to achieve their performance goals.

We offer various learning opportunities to allow employees to grow from both a technical and leadership standpoint.

Consistently living our company values grants each of us the freedom to make autonomous decisions in the best interest of all stakeholders.

We are committed to celebrating the diversity of our individual characteristics that make us unique and creating a culture where everyone experiences a sense of belonging.

Our organizational culture is a competitive advantage, and we prioritize it as such.

We care about understanding the views, perspectives and experiences of our end-users and employees.

This is foundational in maintaining and growing the WD-40 Company brand and business.

Our language, norms, and traditions result in psychological safety, learning, and goal achievement.

This includes a total rewards strategy that ensures each employee can sustain their well-being today and into the future.

Our workforce is comprised of the following functions:

marketing, sales, customer service, finance and accounting, legal, information technology, human resources, supply chain and logistics, innovation, research and development, quality, and other technical fields.

Increasingly, employees collaborate globally with their functional peers or in squads focused on common goals.

Success is accelerated through this global collaboration and learning.

The pandemic inspired us to launch what we call “Work from Where”, a philosophy to support the work-life integration of our global workforce.

This “Work from Where” philosophy enables our coaches and employees to use our values in their decision-making to align on where work is completed.

The Compensation Committee of our Board of Directors provides oversight of our relevant people-management practices.

Our approach to compensation attempts to align the interests of every tribe member with the creation of company value over time.

Our approach to compensation aligns the interests of every employee with the creation of company value over time.

We completed a study in February 2020 to examine gender pay differences to determine if there were occasions of compensation decisions not being based on job-related criteria.

This study identified no biased decision-making, as any differences were explainable by job-related criteria.

The next study will be completed in calendar year 2023.

We will continue to conduct equitable pay studies going forward and will include results from those studies in our future ESG reports.

We invite you to review our ESG

Report (located on our Internet site at www.wd40company.com) for more information about corporate responsibility, our tribe, programs, and initiatives.

Nothing on our website shall be deemed incorporated by reference into this Annual Report on Form 10-K.

The next study will be completed in late calendar year 2023.

We will continue to conduct equitable pay studies going forward.

We invite you to review our ESG report (located on our Internet site at www.wd40company.com) for more information about corporate responsibility, our workforce, programs, and initiatives.

Nothing on our website, including but not limited to our ESG report, shall be deemed incorporated by reference into this Annual Report on Form 10-K.

Maintenance Products

4 unchanged sentences

We have various products and product lines which we currently sell under the WD-40 Brand and they are as follows:

WD-40 Multi-Use Product – The WD-40 Multi-Use Product is a market leader in many countries among multi-purpose maintenance products and is sold as an aerosol spray with various unique delivery systems, a non-aerosol trigger spray and in liquid-bulk form through mass retail stores, hardware stores, warehouse club stores, automotive parts outlets, online retailers and industrial distributors and suppliers.

WD-40® Multi-Use Product – The WD-40 Multi-Use Product is a market leader in many countries among multi-purpose maintenance products and is sold as an aerosol spray with various unique delivery systems, a non-aerosol trigger spray, a precision pen, and in liquid-bulk form through mass retail stores, hardware stores, automotive parts outlets, online retailers, warehouse club stores and industrial distributors and suppliers.

The WD-40 Multi-Use Product is sold worldwide in North, Central and South America, Asia, Australia, Europe, the Middle East and Africa.

WD-40 Multi-Use Product has a wide variety of consumer uses in, for example, household, marine, automotive, construction, repair, sporting goods and gardening applications, in addition to numerous industrial applications.

WD-40 Specialist product line – WD-40 Specialist consists of a line of professional-grade specialty maintenance products that include penetrants, degreasers, corrosion inhibitors, greases, lubricants and rust removers that are aimed at professionals and consumer enthusiasts.

WD-40 Specialist® product line – WD-40 Specialist consists of a line of professional-grade specialty maintenance products that includes penetrants, degreasers, corrosion inhibitors, greases, lubricants and rust removers that are aimed at professionals and consumer enthusiasts.

These products are also sold with various unique delivery systems.

The WD-40 Specialist product line is sold primarily in the U.S.

9 unchanged sentences

3-IN-ONE products are sold primarily in the U.S., Europe, Canada, Latin America and Australia.

GT85 ® – The GT85 brand is a multi-purpose bike maintenance product line that consists of professional spray maintenance products and lubricants which are sold primarily in the bike market through the automotive and industrial channels in the United Kingdom.

This brand was acquired by our U.K.

subsidiary in September 2014 and it has helped build upon our strategy to develop new product categories for WD-40 Specialist and WD-40 BIKE.

Homecare and Cleaning Products

5 unchanged sentences

Spot Shot ® – The Spot Shot brand is sold as an aerosol and a liquid trigger carpet stain and odor eliminator.

The brand also includes environmentally friendly products such as Spot Shot Instant Carpet Stain & Odor Eliminator and Spot Shot Pet Instant Carpet Stain & Odor Eliminator, which are non-toxic and biodegradable.

Spot Shot products are sold primarily through grocery and mass retail channels, online retailers, warehouse club stores and hardware and home center stores in the U.S., Canada and the United Kingdom.

15 unchanged sentences

Our sales do not reflect any significant degree of seasonality.

However, it is common for our sales to fluctuate from period to period or year to year due to various factors including, but not limited to, new or lost distribution, the number of product offerings carried by a customer and the level of promotional activities and programs being run at customer locations.

However, it is common for our sales to fluctuate from period to period or year to year due to various factors including, but not limited to, new or lost distribution, the timing of customer orders particularly in distributor markets, the number of product offerings carried by a customer and the level of promotional activities and programs being run at customer locations.

New or lost distribution occurs when we gain or lose customers, when we gain or lose store count for a customer or when our products are added to new locations within a store or removed from existing locations.

From time to time, as part of new product offering launches, we may gain access to entirely new distribution channels.

The number of product offerings refers to the number of brands and/or the number of products within each of those brands that our customers offer for sale to end user customers.

The number of product offerings refers to the number of brands and/or the number of products within each of those brands that our customers offer for sale to end users.

The level of promotional activities and programs relates to the number of events or volumes of purchases by customers in support of off-shelf or promotional display activities.

Changes in any one of these three factors or a combination of them can cause our sales levels to increase or decrease from period to period.

Promotional activities can also be impacted by customers adjusting to price increases and other market disruptions.

It is also common and/or possible that we could lose distribution or product offerings and experience a decrease in promotional activities and programs in one period and subsequently regain this business in a future period.

2 unchanged sentences

We outsource our finished goods manufacturing directly or through our marketing distributors to various third-party manufacturers.

The Company or its marketing distributors use contract manufacturers in the U.S., Canada, Mexico, Brazil, Argentina, Colombia, the U.K., Italy, Poland, Australia, China, South Korea and India.

We or our marketing distributors use contract manufacturers in the U.S., Mexico, Brazil, Argentina, Colombia, the U.K., Italy, Poland, Australia, China, South Korea and India.

Although we have definitive minimum purchase obligations included in the contract terms with certain contract manufacturers, when such obligations have been included, they have either been immaterial or the minimum amounts have been such that they are below the volume of goods that we have historically purchased.

Supply needs are communicated by us to our contract manufacturers, and we are committed to purchase the products manufactured based on orders and short-term projections, ranging from two months to six months, provided to the contract manufacturers.

Supply needs are communicated by us to our contract manufacturers, and we are committed to purchasing the products manufactured based on orders and short-term projections, ranging from two months

to six months, provided to the contract manufacturers.

We also formulate and manufacture concentrate used in our WD-40 products at certain of our own facilities and at third-party contract manufacturers.

2 unchanged sentences

We rely on a limited number of third-party contract manufacturers and component suppliers, including single or sole-sourced suppliers, for certain of our raw materials, packaging, product components and other necessary supplies.

Where possible and where it makes business sense, we work with secondary or multiple suppliers to qualify additional supply and, historically, we have been able to obtain adequate capacity and raw materials.

However, during the COVID-19 pandemic, we have experienced certain constraints, particularly in our Americas supply chain.

These challenges include general aerosol-related production capacity constraints primarily due to increased demand at third-party manufacturers along with shortages of certain other raw

materials and freight services.

Where possible and where it makes business sense, we work with secondary or multiple suppliers to qualify additional supply sources.

Historically, except for limited circumstances during the COVID-19 pandemic, we have been able to obtain adequate capacity and raw materials.

The primary components and raw materials for most of our products include specialty chemicals and aerosol cans, which are manufactured from commodities that are subject to market price fluctuations.

The availability of these components and raw materials is affected by a variety of supply and demand factors, including global market conditions, plant capacity utilization, and natural disasters.

We have been experiencing input cost inflation that has impacted the cost of certain raw materials and freight services over the last couple of years.

Actions that we are taking to increase prices with our customers and cost savings initiatives that are currently underway will mitigate some of these inflationary pressures.

We have been experiencing input cost inflation that has impacted the cost of certain raw materials and freight services over the last several years.

As a result, we took actions to increase prices with our customers to help mitigate some of these inflationary pressures.

We also have and continue to implement cost savings initiatives to help mitigate those pressures.

Our business results depend on the effective management and remedy of any supply disruptions.

We expect these components and raw materials to continue to be readily available in the future and we have developed sourcing alternatives and risk mitigation plans.

We expect some level of market constraints to persist in fiscal year 2023, as described above.

We expect some level of challenging market conditions to persist in fiscal year 2024, as described above.

Research and Development

14 unchanged sentences

The WD-40 brand, 3-IN-ONE, Lava, Solvol, X-14, 2000 Flushes, Carpet Fresh and no vac, Spot Shot, GT85, and 1001 trademarks are registered or have pending registrations in various countries throughout the world.

WD-40 Company, the WD-40 ® logo, WD-40 ® Multi-Use Product, WD-40 Specialist ® , WD-40 BIKE ® , 3-IN-ONE ® , GT85 ® , 2000 Flushes ® , no vac ® , 1001 ® , Spot Shot ® , Lava ® , Solvol ® , X-14 ® , and Carpet Fresh ® and other trademarks or service marks of WD-40 Company or its subsidiaries are the property of WD-40 Company or its subsidiaries.

Other service marks, trademarks, and tradenames referred to in this Annual Report on Form 10-K are the property of their respective

Except as set forth above and solely for convenience, the trademarks and tradenames in this Annual Report on Form 10-K are generally referred to without the ® and ™ symbols, but such references should not be construed as any indicator that their respective owners will not assert, to the fullest extent under applicable law, their rights thereto.

Financial Information about Foreign and Domestic Operations

6 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business