- Company-wide sales growth now expected in 17-19% range
- Adjusted non-GAAP adjusted EPS expected in a range of $ 9.00 to $ 9.30
- Consumer purchases of lawn and garden products are up 10% year-to-date in June
MARYSVILLE, Ohio, June 01, 2021 (GLOBE NEWSWIRE) – The Scotts Miracle-Gro Company (NYSE: SMG), a global marketer of branded lawn and garden products, as well as indoor growing and hydroponic products, today announced increased sales and profit guidance for fiscal 2021 based on the continued strength of its US Consumer and Hawthorne segments.
For the fiscal year ending September 30, 2021, ScottsMiracle-Gro now expects company-wide sales growth of 17-19%. The revision is mainly due to stronger growth in the consumer segment in the United States, where the company is now forecasting sales growth of 7 to 9 percent, compared to its previous range of 4 to 6 percent. Hawthorne’s sales also continue to beat expectations, as the company now forecasts sales growth of 40 to 45 percent for the full year, compared to previous forecasts of 30 to 40 percent growth.
As a result, adjusted non-GAAP earnings are expected to be in a range of $ 9.00 to $ 9.30 per share. This compares to the previous forecast of $ 8.60 to $ 9.00 per share. Adjusted non-GAAP results exclude depreciation, restructuring and other non-recurring expenses.
“The level of engagement we see in our consumer segment in the United States continues to exceed expectations with consumer purchases up 10% as of June,” said Jim Hagedorn, President and CEO . “Consumer purchases, in units, have increased by more than 20% since the start of the year, with retailers resuming a higher level of promotional activity than last season. While consumer purchases declined in dollars in May, as we expected, it was still the third highest on record for a single month, surpassed only by what we experienced in May and April. . In fact, so far this season we’ve seen four weeks in which consumer purchases have exceeded $ 160 million. Before last year, we had never seen a single week of consumer shopping at this level.
“The gardening business continues to be the primary driver of growth with strong consumer engagement in all regions of the United States and across all retail channels. We also continue to see year-over-year improvement in our lawn and pest control categories. The investments we have made to retain the new consumers who entered the category last season are paying off, giving us confidence to continue investing throughout the remainder of fiscal 2021 with the goal of bringing back again these new gardeners in the category next season. .
“We also intend to increase our investment in the Hawthorne business for the remainder of the year as sales and operating margin continue to exceed our expectations. Sales volume at Hawthorne continues to improve even in the face of difficult year-over-year comparisons, as we not only benefit from the growth of the overall market but also the unique competitive advantages we have. worked so hard to establish.
Due to increased investment in both segments, the company said it expects selling and administrative expenses for the full year to be flat or slightly higher than in ‘one year ago. The gross margin rate forecast for the full year is unchanged with an expected decline of 175 to 225 basis points.
“Although commodity prices remain significantly higher than a year ago, we remain focused on ensuring that prices that go into effect in August will offset the pressures on commodities as we prepare for the season. next, ”said Cory Miller, senior vice president and interim chief financial officer. “We remain prepared to be more aggressive in our pricing decisions, if necessary, to stay ahead of these costs.”
Management will provide further comment on its expected results at 9:40 a.m. Eastern Time tomorrow, June 2, 2021, in a virtual presentation at William Blair & Co. 41st Annual Growth Actions Conference. The discussion will be available on the Company’s investor relations website at http://investor.scotts.com.
With sales of approximately $ 4.1 billion, the company is one of the world’s largest distributors of branded consumer lawn and garden care products. The Company’s brands are among the most recognized in the industry. The Company’s Scotts®, Miracle-Gro® and Ortho® brands are market leaders in their categories. The company’s wholly owned subsidiary, The Hawthorne Gardening Company, is a leading supplier of nutrients, lighting and other materials used in the indoor growing and hydroponics segment. For more information, visit us at www.scottsmiraclegro.com.
Caution regarding forward-looking statements
Statements contained in this press release, other than statements of historical fact, which relate to activities, events and developments that the Company expects or anticipates will occur or may occur in the future , including, but not limited to, information regarding future economic and financial performance the condition of the company, the plans and objectives of the management of the company and the assumptions of the company regarding such performance and plans are “Forward-looking statements” within the meaning of US federal securities laws which are subject to risks and uncertainties. These forward-looking statements can generally be identified as statements that include phrases such as “direction”, “outlook”, “projected”, “believe”, “target”, “predict”, “estimate”, “forecast”,, ” “may”, “objective”, “expect”, “anticipate”, “intend”, “plan”, “foresee”, “probable”, “will”, “should” or others Similar words or expressions. Actual results could differ materially from the forward-looking information contained in this press release due to various factors, including, but not limited to:
- The ongoing COVID-19 pandemic could have a material adverse effect on the Company’s business, results of operations, financial condition and / or cash flow;
- Compliance with environmental and other public health regulations or changes in such regulations or regulatory enforcement priorities could increase the Company’s operating costs or limit the Company’s ability to market all of its products. ;
- Any damage to the Company’s reputation or to the reputation of its products or of the products it markets on behalf of third parties could have an unfavorable effect on its business;
- If the Company underestimates or overestimates demand for its products and does not maintain appropriate inventory levels, its net sales and / or working capital could be adversely affected;
- If the Company is unable to effectively carry out its electronic commerce activities, its reputation and operating results could be compromised;
- Due to the concentration of the Company’s sales to a small number of retail customers, the loss of one or more of its main customers or a significant reduction in orders from its main customers could adversely affect the Company’s financial results;
- Climate change and adverse weather conditions could have a negative impact on financial results;
- Some of the Company’s products may be purchased for use in new or emerging industries or segments and / or be subject to varying, inconsistent and inconsistent laws, regulations, administrative practices, enforcement approaches, judicial interpretations and consumer perceptions. rapidly changing;
- The Company’s operations may be affected if its computer systems are not functioning properly or if it is the subject of a data breach or cyber attack;
- The Company may not be able to adequately protect its intellectual property and other property rights which are important to the business of the Company;
- If the third reformulated marketing agreement for Roundup consumer products is terminated, or if Monsanto’s consumer Roundup business declines significantly, the Company would lose a substantial source of future profits and absorption of overheads;
- Hagedorn Partnership, LP beneficially owns approximately 25% of the common shares of the Company and can significantly influence decisions that require shareholder approval;
- Acquisitions, other strategic alliances and investments could cause operating difficulties, dilution and other adverse consequences that could have a negative impact on the business and operating results of the Company.
Additional detailed information regarding a number of important factors that could cause actual results to differ materially from the forward-looking information contained in this press release is readily available in the quarterly, annual and other reports publicly filed by the Company. The Company disclaims any obligation to update developments in these risk factors or to publicly announce any revision of any of the forward-looking statements contained in this press release, or to make corrections to reflect future events or developments.
Jim the King
Executive Vice President
Investor Relations and Corporate Affairs