Scotts Miracle-Gro reported a strong second quarter ended March 29, driven by strong sell-in of its consumer products in the United States and Europe.
Adjusted income from continuing operations increased 38% to $136.7 million from $99.3 million in the prior-year quarter. This growth was driven by increased sales, continued margin expansion and strong control of operating expenses.
Net sales were $1.08 billion for the quarter, up 7% from $1.01 billion a year ago, due to strong initial sell-in to retailers.
"It should come as no surprise that consumer activity was lighter than we had originally anticipated, but we have seen high levels of consumer purchases when the weather has cooperated," said Jim Hagedorn, chairman and CEO. "We are pleased with the strong support we are seeing from our retail partners and glad to see a strong start to the season in Europe, where our business is currently trending ahead of our internal expectations.
Sales in the Global Consumer segment increased 9% to $1.05 billion during the second quarter, compared with $962.8 million during the same quarter a year ago.
Scotts LawnService sales were down 12% to $28.9 million in the second quarter, compared with $32.9 million a year ago, primarily due to a delay in the start of the spring season.
Net sales for the first six months of fiscal 2014 were $1.27 billion, an increase of 6% from $1.20 billion a year ago. The year-over-year change was attributable to increased sales in the Global Consumer segment, primarily due to strong retailer support, targeted pricing and the acquisition of the Tomcat business. For the first six months of the year, Scotts LawnService sales were down 3%.
Adjusted income from continuing operations was $71.1 million for the first six months of the year, compared with $30.8 million during the same period a year ago.