|The Scotts Miracle-Gro Company||NEWS|
ScottsMiracle-Gro Announces Record Full Year Results as
Fourth Quarter Sales Exceed Expectations in U.S. Consumer Segment
•U.S. Consumer segment sales increase 11% in fiscal 2021; decline 28% in Q4
•Full-year Hawthorne sales increase 39%, decline 2% in Q4 despite growth in the U.S.
•Full-year GAAP earnings of $9.03 per share; Q4 loss of $0.87 per share
•Non-GAAP adjusted full-year EPS of $9.23; Q4 adjusted loss of $0.82 per share
•Fiscal 2022 guidance: Non-GAAP adjusted EPS $8.50 to $8.90; sales growth 0 to 3%
•Company announces intent for share repurchases of $300 million in fiscal 2022
MARYSVILLE, Ohio, November 3, 2021 – The Scotts Miracle-Gro Company (NYSE: SMG), the world’s leading marketer of branded consumer lawn and garden as well as indoor and hydroponic growing products, today released record full year financial results driven by a company-wide sales increase of 19 percent and continued growth in all major operating segments.
The Company also established guidance for fiscal 2022 that includes non-GAAP adjusted earnings of $8.50 to $8.90 per share on company-wide sales growth of 0 to 3 percent, both of which will be aided by a second pricing action in the U.S. Consumer segment to mitigate commodity inflation. The Company also said it plans to repurchase up to another $300 million in shares during fiscal 2022.
For the year ended September 30, 2021, company-wide sales increased 19 percent to a record $4.93 billion, compared with $4.13 billion a year earlier. GAAP earnings from continuing operations were $9.03 per diluted share, compared with $6.78 per diluted share in the prior year. Non-GAAP adjusted earnings, which are the basis of the Company’s guidance and exclude impairment, restructuring, and other non-recurring items, were $9.23 per diluted share compared with $7.24 per diluted share a year ago.
Company-wide sales in the fourth quarter declined by 17 percent to $737.8 million. The Company reported a GAAP loss in the quarter of $0.87 per share compared with earnings last year of $0.07 per diluted share. The adjusted loss in the quarter was $0.82 per share compared with earnings of $0.06 per diluted share a year ago.
“The continued engagement by consumers throughout the lawn and garden season drove full-year U.S. Consumer sales 11 percent higher on a full-year basis on top of last year’s 25 percent growth,” said Jim Hagedorn, chairman and chief executive officer. “Consumer purchases of our products at our largest retail partners – as measured in units – were up 6 percent for the full year, with growth in every major product category. When compared to 2019, consumer purchases are up 21 percent and suggest a level of consumer enthusiasm that we expect to carry into the 2022 lawn and garden season.
“At Hawthorne, we continued to use our competitive advantages to drive 39 percent segment growth on a full-year basis despite a 2 percent decline in the fourth quarter. While we saw expected pressure on Hawthorne’s Q4 results due to a widely publicized over-supply of cannabis in California, sales of hydroponic supply products in the U.S. increased more than 10 percent on an apples-to-apples basis and we remain focused on the long-term opportunities to expand our leadership in this rapidly evolving industry.
“As we look to fiscal 2022, we have continued confidence in our strategy and ability to drive long-term shareholder value,” Hagedorn continued. “Certain macro issues beyond our control may present challenges we haven’t faced for a while, but I’m confident in our team’s ability to execute. We expect to continue pursuing acquisition opportunities throughout the year and remain committed to using our financial flexibility to return cash to shareholders. That is why, in addition to the $113 million of share repurchases in fiscal ’21, we plan to repurchase as much as another $300 million in 2022.”
Fourth quarter details
Company-wide sales declined 17 percent to $737.8 million. U.S. Consumer, which was facing a 92 percent growth comparison from fiscal 2020, decreased 28 percent to $369.4 million. Hawthorne sales declined 2 percent to $329.1 million due to declines in the European and Canadian businesses. Due to a shift in the fiscal calendar, the fourth quarter had six fewer days than a year ago which negatively impacted the quarter by $54 million. Excluding the calendar impact U.S. Consumer sales declined 23 percent and Hawthorne sales increased 5 percent, including a more than 10 percent increase in sales of hydroponic products in the U.S.
For the quarter, the GAAP and non-GAAP adjusted gross margin rate was 17.1 percent and 17.4 percent, respectively, compared with 24.3 percent in the prior year. The decline was driven primarily by a year-over-year decline in fixed cost leverage as well as higher distribution costs. Pricing and decreased promotional activity net of increased material costs helped to offset the decline.
The following information was filed by Scotts Miraclegro Co (SMG) on Wednesday, November 3, 2021 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.