Scotts posts Q3 declines
Scotts Miracle-Gro reported declines in sales and income for the third quarter of 2014, but pointed to momentum that may place the company at the top end of its guidance for the year.
"The second half of the lawn and garden season has been extremely strong, with positive consumer purchases against the double-digit increases we posted a year ago," said Jim Hagedorn, chairman and CEO. "Our momentum is carrying into the fourth quarter with consumer purchases in July at an all-time high and our European business on track to have its most profitable year ever."
Net sales for the three months ended June 28 were $1.12 billion, down about 2% from $1.14 billion in the year-ago period. Scotts largely attributed this to a 3% decline in the Global Consumer segment, which saw lower unit volume in the U.S. this quarter. Meanwhile, Scotts LawnService sales jumped 3% to $92.8 million.
Additionally, net income was $121.7 million for the quarter, down from $148.2 million in 2013.
Scotts estimates that gathering momentum from June onward will likely place the company at a 1% to 2% year-over-year net sales increase for 2014, up from its previously issued guidance. A jump of 100 basis points in adjusted gross margin is also expected.
"Based on our continued momentum, we’re now confident that full-year earnings are trending toward the high end of our previous guidance range with upside potential depending on results for the balance of the year," added Hagedorn. "We also are finalizing plans to increase our focus on shareholder-friendly actions. Within the coming weeks, we expect to announce returning roughly $125 million, or about $2 per share, to shareholders during the fourth quarter."
HIRI announces fall conference, focused on the future
Noted futurist J. Walker Smith will kick off the Home Improvement Research Institute’s 2014 Fall Conference. This year’s conference is titled "Managing The Future in Home Improvement" and will be held on Oct. 16, 2014, in Chicago.
Smith is executive chairman of The Futures Company, a market research and consulting firm. His topic is described as “Planning for the Future of Home Improvement.”
Other presenters on the agenda include Joshua Rosenbaum, managing director of RBC Capital Markets, and Eric Voyer, VP of the Stevenson Group.
“With the industry on solid footing, companies are looking to get their share of the growth,” said Fred Miller, managing director of HIRI. “This year’s conference is loaded with information on key future trends that will help them accomplish their goals.”
For more information, visit HIRI.org.
LP loses momentum in Q2
Nashville, Tennessee-based Louisiana-Pacific Corporation slowed down in the second quarter of 2014, which saw a sales decline of 9% and significantly lower earnings for the building products giant.
Net sales for the three months ended June 30 were $518.5 million, down from $567.0 million in 2013. Sales for the six-month period were also down year-over-year, netting $963.2 million in comparison to $1.1 billion last year.
Net income for the quarter was $2.1 million, down from $94.1 million in the year-ago period. LP also posted a loss of $12.1 million for the six-month period, compared to income of $159.4 million in 2013.
LP’s second-quarter performance included bright spots. The Siding segment posted an 11% increase in net sales. Engineered Wood Products were up 32.8%.
“LP’s Siding business had another quarter of record volume shipments of SmartSide despite a tepid housing recovery in the quarter,” said CEO Curt Stevens. “Strong demand from retail, repair and remodeling and non-residential structures allowed for continued growth in this business.”
LP’s Oriented Strand Board segment was down 26.8% year-over-year, however.
“All the signs point to improving demand for housing given demographics, an improving economy and job growth,” continued Stevens. “However, for this recovery to reach its potential, steps must be taken to foster credit access to the first time home buyer."