Central Garden & Pet snags 16.6% sales boost in Q1
Central Garden & Pet Company experienced a solid double-digit boost in the first quarter, putting the company on track to meet its 2017 guidance.
"The first quarter puts Central well on track to deliver our fiscal year earnings guidance, which will remain unchanged at this time," said George Roeth, president & CEO of Central Garden & Pet. "While over half of the year-over-year earnings increase in the first quarter was related to acquisitions and timing, we continue to be encouraged by our strong organic sales growth and market share gains. We remain focused on executing with excellence against our strategy and plan."
Net sales for the first quarter ended Dec. 24 increased 16.6% to $419.5 million, up from $359.8 million in the year-ago period. Much of the gain was owing to two recent acquisitions, as well as a favorable close to the Fall garden season and share growth in the Pet segment.
Branded product sales were up 20.4%, and sales of other manufacturers’ products rose 4.1%. Organic sales growth was 7.0%.
Net sales were up 22.2% in the Pet segment, as well as 4.0% in the Garden segment.
Meanwhile, the company moved into the black, with net income of $7.6 million up from a loss of $8.6 million in the year-ago period.
In terms of 2017 guidance, the company expects non-GAAP earnings per fully-diluted share of $1.34 or higher for fiscal 2017, an increase of 6% or more from the prior year.
"It is important to note that our first quarter is a very small part of the company’s annual earnings, and as such, we are holding our guidance at this time," added Roeth. "Our business plans are delivering against expectations, and we continue to stay focused on executing our strategies of accelerating our portfolio growth momentum, increasing our innovation output and success rates, and driving cost savings and productivity improvements. We fully expect that these actions and associated investments will drive sustainable profit growth in the years ahead; however quarterly results versus a year ago may be somewhat lumpy due to our size, weather and timing of activity."
Beacon breaches $1 billion again
Beacon Roofing Supply hit an important benchmark for the third straight quarter in Q1, exceeding $1 billion in sales once again.
“Fiscal 2017 is off to a solid start with a third consecutive quarter of sales greater than $1 billion," president and CEO Paul Isabella said. "Our residential roofing business delivered 6.5% daily sales growth in existing markets, representing the 11th consecutive quarter in which we demonstrated year-over-year improvement. Gross margin remains robust, exceeding 25%, a 117 basis point improvement over last year. This increase results from a product mix shift as well as our pricing discipline and initiatives."
Net sales for the first quarter ended Dec. 31 increased 2.6% to a Q1 record of $1.00 billion, compared to $976.5 million in 2016.
Residential roofing product sales increased 7.2%, non-residential roofing product sales declined 10.4%, and complementary product sales increased 19.8% over the prior year.
Net income more than doubled: $20.4 million compared to $7.1 million in the year-ago period. This was largely thanks to volume growth within residential roofing and strong levels of year-to-year gross margin improvement.
"More normalized weather conditions have made for challenging sales comparisons to last year’s mild fall and winter, but should provide benefit in the latter half of the year," Isabella added. "We continue deployment of our growth strategy in 2017 including integrating the three great acquisitions made in December and January that added nine branches, including seven in the Pacific Northwest. As we move forward this year, we will maintain our focus on sales growth, gross margin stability and improved operating leverage, all of which should enable us to deliver another great year of performance and earnings for our shareholders.”
Readers Respond: Bullish on marketing
New year, new you, new marketing budget?
Earlier this week, we took a pulse check of our readership by asking whether they intended to spend more or less on marketing this year.
So how do marketing budgets stack up in 2017?
The biggest share of respondents so far (32%) said their budgets were increasing by 10% or more, suggesting that advertising will play an increasingly larger role in the home improvement industry this year. A slightly smaller contingent (29%) said they were looking at increase of 10% or less.
A full 25% voted "flat," suggesting they would maintain the level of their marketing output.
Only 14% total said they would spend less this year — 7% for "down 0 to 10%," and 7% for "down more than 10%."
What are your plans for 2017? Let us know by voting here.