Spectrum Brands announced first-quarter sales and earnings grew year over year as its brand and e-commerce investments took hold.
Net income from continuing operations was $24.6 million, or 87 cents per diluted share, versus $17.5 million, or 51 cents per diluted share, in the year-before period.
Adjusted diluted earnings per share were $1.02 versus 63 cents in the year-earlier quarter, the company reported.
Spectrum beat a Zacks Investment Research analyst consensus estimate of 91 cents per adjusted diluted share but came up short of a $701.5 million revenue forecast.
Net sales increased 1.2% to $700.2 million, with an increase in organic net sales of 1.9%, Spectrum indicated, excluding the impact of $5.1 million of unfavorable foreign exchange rates. In the Home & Garden segment, net sales gained 27.9% to $92.1 million. Net sales in the Home & Personal Care segment increased 1.4% to $348.1 million, and net sales in the Global Pet Care segment decreased 6.1% to $260 million. An extended fall season and accelerated pre-season sales gave Home & Garden a boost, and strong e-commerce revenues helped Home & Personal Care gain, according to Spectrum Brands. Growth in those segments partially was offset by the sales decline in Global Pet Care primarily because of a strategic acceleration of orders into the prior year related to a resource planning software implementation, the company pointed out.
Spectrum’s home and personal care business includes such small appliance brands as Black & Decker, George Foreman, Russell Hobbs, Remington, PowerXL, Emeril Lagasse and CopperChef.
Operating income was $44.7 million versus $25 million in the year-previous quarter with the increase due to improved gross profit and cost savings initiatives offset by higher marketing and advertising spending, Spectrum maintained.
“The brand-focused investments we started making in 2024, and are continuing to make in 2025, are driving innovation in our products and consumer demand,” said David Maura, Spectrum chairman and CEO. “Our investments in e-commerce are helping us win in what is the fastest growing channel for most of our products. The momentum we built last year is carrying over into this year. Our Home and Personal Care business had a solid holiday season, and our Home and Garden business had one of its best first quarters in recent history. Global Pet Care’s quarterly sales were negatively impacted by the acceleration of retailer purchases into last quarter ahead of the business’ go-live on S/4Hana. GAAP net income and diluted earnings per share both increased, and our adjusted EBITDA was 26.9% higher than last year’s adjusted EBITDA excluding investment income. Gross margins are also up 140 basis points over the first quarter of fiscal ‘24. Our operations are continuing to deliver cost improvements and we are staying lean.”
In response to sourcing issues, Maura said, “Our operations and commercial teams are activating plans to minimize and mitigate the impact of the recent tariff actions, accelerating our plans to pivot our production out of China where practical and working with our suppliers and retailers to offset tariff headwinds. We are encouraged by the start of our year and intend to continue this momentum as the year progresses.”
