Company now expects adjusted earnings of $2.35 to $2.45 per share; Free cash flow outlook also improves to a minimum of $180 million
MARYSVILLE, Ohio, June 17 /PRNewswire-FirstCall/ — The Scotts Miracle-Gro Company (NYSE: SMG), the world’s leading marketer of branded consumer lawn and garden products, today updated its financial outlook for fiscal 2009 based on strong continued demand for its products in the United States. The Company said it expects adjusted earnings for fiscal 2009 to be in a range of $2.35 to $2.45 per share.
The Company also updated its fiscal 2009 outlook for free cash flow to a minimum of $180 million.
Consumer purchases of the Company’s products in the U.S., as measured by point-of-sale data from its largest retail partners, were up 17 percent on a fiscal year-to-date basis through the end of May, with particular strength in gardening-related categories. Consumer purchases of growing media products improved 23 percent through May compared with the same period last year. Consumer purchases of lawn fertilizer increased 19 percent. Similar trends remained in place through the first half of June.
“The high level of consumer engagement we’ve seen this season is a testament to three things: the coordinated approach to marketing and promotion between us and our retail partners; our increased advertising spend throughout the season and improved creative direction; and a 30 percent increase in the number of hours our sales force has spent in retail stores,” said Jim Hagedorn, chairman and chief executive officer. “These factors have helped to drive strong momentum beyond the peak of the season, and we’re hopeful it will continue through the balance of the fiscal year.”
In addition to the strength of the Global Consumer segment, Scotts LawnService is now expected to report strong earnings improvement despite lower year-over-year revenue and customer count.
“The performance at Scotts LawnService this year is due to the outstanding work of Peter Korda and his entire team,” Hagedorn continued. “By accurately projecting challenges and aggressively managing costs, they are exceeding expectations and may even be positioned to deliver a record level of earnings this year, a significant achievement given the current economic environment.”
Company-wide sales are expected to increase 7 to 8 percent, excluding the impact of recall and registration matters and foreign currency. On a reported basis, that translates to an expected improvement of 4 to 5 percent.
The Company’s previous guidance assumed adjusted earnings in a range of $2.10 to $2.30 per share and free cash flow between $150 million and $170 million.
With nearly $3 billion in worldwide sales and more than 6,000 associates, The Scotts Miracle-Gro Company, through its wholly-owned subsidiary, The Scotts Company LLC, is the world’s largest marketer of branded consumer products for lawn and garden care, with products for professional horticulture as well. The Company’s brands are the most recognized in the industry. In the U.S., the Company’s Scotts®, Miracle-Gro®, Ortho® and Smith & Hawken brands are market-leading in their categories, as is the consumer Roundup® brand, which is marketed in North America and most of Europe exclusively by Scotts and owned by Monsanto. In the U.S., we operate Scotts LawnService®, the second largest residential lawn care service business. In Europe, the Company’s brands include Weedol®, Pathclear®, Evergreen®, Levington®, Miracle-Gro®, KB®, Fertiligene® and Substral®. For additional information, visit us at www.scotts.com.