Spectrum Brands readily beat Wall Street estimates in its third quarter as sales across the company’s three business segments, including its small appliance group, advanced.
The company also reported it received $60.6 million in International Emergency Economic Powers Act tariff refunds in the period.
Net loss from continuing operations was $20.3 million, or $1.11 per diluted share, versus net income from continuing operations of $20.5 million, or 83 cents per diluted share, in the year-earlier quarter.
Adjusted for one-time events, earnings per diluted share from continuing operations were $2.79 versus $1.24 in the year-prior period, the company maintained.
An analyst consensus estimate from Zacks Investment Research forecast earnings per adjusted diluted share of $1.49 and revenues of $732.4 million.
Net sales were $753.3 million versus $699.6 million in the year-previous quarter.
Net sales gained 7.7% with an increase in organic net sales of 6.6%, which excludes the impact of $7.5 million of favorable foreign exchange rates. Net sales increased across all three business segments, led by Home and Garden with market share gains across key brands and favorable weather conditions early in the quarter driving purchasing, Spectrum maintained.
Operating income was $15.9 million versus 31.3 million in the year-before period.
In the Home and Personal Care appliance segment, net sales were $264.4 million versus $255.2 million in the year-past quarter. The group includes such kitchen electrics brands as Black & Decker, George Foreman (pictured above), Russell Hobbs, PowerXL and Emeril Lagasse, along with the Remington personal care appliance business.
Net sales increased 3.6% while organic net sales gained 1.1% excluding favorable foreign currency impacts. Net sales in Personal Care advanced in the mid-teens while net sales in Home Appliances slipped in the mid-single digits, Spectrum reported. North American net sales slid in the mid single digits primarily due to lower sales in Home Appliances, reflecting softness across certain brands and exiting the DRTV business.
In the Home & Garden segment, net sales were $225.2 million versus $189.2 million in the year-past quarter.
Net sales increased 19.% and organic net sales gained 19.1% due to favorable weather conditions in April positively impacting POS and retailer replenishment order patterns, with above-market growth across key brands, Spectrum asserted.
In the Global Pet Care segment, net sales were $263.7 million versus $255.2 million in the year-past quarter.
Net sales increased 3.3%, and excluding favorable foreign currency impacts, organic net sales increased 2.9%, Spectrum indicated. Net sales in Companion Animal gained mid-single digits while sales in Aquatics declined mid-single digits. North American net sales advanced, led by Companion Animal with modest category growth and continued market share gains across key brands.
In announcing the third-quarter results, David Maura, Spectrum chairman and CEO, said. “We are pleased with our results this quarter, with all three businesses delivering top-line growth, highlighted by a record-setting quarter in our Home & Garden business. Across both Global Pet Care and Home & Garden, our categories benefited from solid underlying demand and our key brands continued to outperform the market. In Home & Personal Care, while results remain impacted by soft consumer demand, we are seeing encouraging signs of stabilization in North America, and our key brands in Latin America continue to perform well. Our focus on profitability is reflected in our results, with each segment delivering adjusted EBITDA growth.”
Maura added it was important to consider that “the strength of our earnings performance was driven by operational execution and business fundamentals, independent of the benefit from IEEPA tariff refunds. These tariff refunds represent a recovery of prior losses which will allow us to invest back into our businesses for overall long-term health. Given our strong year-to-date performance and continued operating momentum, we are updating our earnings framework and increasing our adjusted EBITDA expectation, excluding the impact of tariff refunds, to mid-single-digit growth while maintaining our net sales expectation of flat to low single-digit growth in fiscal 2026,” he said.
