In the fourth quarter, Newell Brands did better than Wall Street expected as it pursued a revamped corporate strategy that included initiatives to improve operations.
Net loss was $86 million, or 21 cents per diluted share, versus a net loss of $249 million, or 60 cents per diluted share, in the year-earlier quarter. Adjusted for one-time events, net income was $92 million, or 22 cents per diluted share, compared with $65 million, or 16 cents per diluted share, in the prior-year period, the company reported.
An analyst consensus estimate published by Yahoo Finance put adjusted diluted earnings per share at 17 cents and revenues at $1.98 billion.
Net sales were $2.08 billion versus $2.29 billion in the year-previous quarter. Operating loss was $10 million versus an operating loss of $273 million in the year-before period, while adjusted operating income was $159 million versus $113 million.
In the quarter, Newell’s Home and Commercial Solutions segment generated net sales of $1.28 billion versus $1.39 billion in the fiscal 2022 period, reflecting a core sales decline of 8.2% and the impact of certain category exits, partially offset by the impact of favorable foreign exchange, the company noted. Core sales declined in all three segment businesses: kitchen, home fragrance and commercial. Reported operating income was $31 million versus an operating loss of $300 million in the fiscal 2022 quarter, while adjusted operating income was $162 million compared with $58 million.
The Learning and Development segment generated net sales of $635 million versus $684 million in the fiscal 2022 quarter, as the impact of favorable foreign exchange partially offset a core sales decline of 7.7%, Newell pointed out. Core sales declined in both the writing and baby businesses. Reported operating income was $80 million versus $88 million in the fiscal 2022 period, while adjusted operating income was $88 million compared with $98 million.
The Outdoor and Recreation segment generated net sales of $165 million versus $211 million in the fiscal 2022 quarter, Newell maintained. Reported operating loss was $45 million versus $14 million in the fiscal 2022 period, while the adjusted operating loss was $25 million compared with $4 million.
For the full year, net loss was $388 million, or 94 cents per diluted share, versus net income of $197 million, or 47 cents per diluted share, in the year earlier. Adjusted net income was $330 million, or 79 cents per diluted share, versus $654 million, or $1.57 per diluted share, in the year prior.
Net sales were $8.13 billion versus $9.46 billion in the year previous. Operating loss was $85 million versus operating income of $312 million in the year before, while adjusted operating income was $570 million versus $956 million.
In introducing the financial results, Chris Peterson, Newell Brands president and CEO, said, “Since our leadership transition in May 2023, we introduced and deployed a comprehensive corporate strategy, which focuses on disproportionately investing in innovation, brand building and go-to-market excellence in our largest and most profitable countries and brands as part of a clear set of Where to Play and How to Win choices. Behind this clear focus, and amidst a difficult external environment, we drove record productivity across the supply chain, significantly improved cash flow by rightsizing inventory, further reduced Newell’s SKU count and took decisive actions to strengthen the company’s front-end commercial capabilities, which are critical to returning Newell to sustainable and profitable growth. The tangible progress on our strategy, together with our actions to reduce overhead cost structure, bolster our confidence that we are taking appropriate actions to strengthen the organization, improve its financial performance and create value for our stakeholders.”
Mark Erceg, Newell Brands CFO added, “We dramatically improved the underlying structural economics of the business during the fourth quarter, as both gross margin and operating margin expanded significantly versus last year. In addition, full-year operating cash flow was very strong, increasing by $1.2 billion to $930 million, which allowed us to reduce debt by about $500 million. We remain confident that despite a challenging macroeconomic backdrop, the significant investments we are making to augment our core capabilities and accelerate our business transformation will allow us to fully operationalize our new corporate strategy and strengthen the company’s performance going forward.”
