The Scotts Miracle-Gro Company (SMG - Free Report) reported a loss from continuing operations of $50 million or 90 cents per share in first-quarter fiscal 2022 (ended Jan 1, 2022) compared with a profit of $25.2 million or 43 cents per share in the year-ago quarter.
Barring one-time items, the adjusted loss was 88 cents per share against earnings of 39 cents a year ago. The figure was wider than the Zacks Consensus Estimate of a loss of 81 cents.
Net sales fell 24.4% year over year to $566 million and beat the consensus mark of $554.7 million.
Company-wide gross margin rate (as adjusted) was 21% compared with 25.5% in the year-ago quarter.
Segment Details
In the first quarter, net sales in the U.S. Consumer division declined 16% year over year to $342.4 million. The segment delivered a profit of $10.7 million against $45.3 million in the prior-year quarter.
Net sales in the Hawthorne segment declined 38% year over year to $190.6 million in the reported quarter. The segment reported a loss of $5.3 million, down 113% year over year.
Net sales in the Other segment rose 6% year over year to $33 million. The segment reported a profit of $1.3 million.
Balance Sheet
At the end of the first quarter, the company had cash and cash equivalents of $16.4 million, down 23.7% year over year. The long-term debt was $3,082.2 million, up 55.7% year over year.
Outlook
The company noted that better-than-expected results in the U.S. Consumer segment, along with additional pricing actions that will take effect in the third quarter, allowed it to raise full-year sales guidance to a range of +2% to -2%. The earlier guided range was flat to -4%.
SMG also announced plans to consolidate U.S. lighting manufacturing for Hawthorne into a single location and to close another recently acquired assembly facility and move those operations to its Santa Rosa, CA site. A restructuring charge of up to $5 million is projected to be recorded in the second quarter and will be excluded from the company’s full-year adjusted results.
Price Performance
Shares of Scotts Miracle-Gro have declined 38.9% in the past year against a 22.4% rise of the industry.
Zacks Rank & Key Picks
Scotts Miracle-Gro currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the basic materials space are Albemarle Corporation (ALB - Free Report) , Nutrien Ltd. (NTR - Free Report) and AdvanSix Inc. (ASIX - Free Report) .
Albemarle, currently sporting a Zacks Rank #1 (Strong Buy), has an expected earnings growth rate of 51.3% for the current year. The Zacks Consensus Estimate for ALB's earnings for the current year has been revised 5.4% upward in the past 60 days. You can see the complete list of today’s Zacks #1 Rank stocks here.
Albemarle beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, the average being 22.1%. ALB has rallied around 39.1% over a year.
Nutrien, sporting a Zacks Rank #1, has a projected earnings growth rate of 53.8% for the current year. The Zacks Consensus Estimate for NTR's current-year earnings has been revised 17.4% upward in the past 60 days.
Nutrien beat the Zacks Consensus Estimate for earnings in three of the last four quarters while missing once. It has a trailing four-quarter earnings surprise of roughly 73.5%, on average. NTR has rallied around 42% in a year.
AdvanSix has a projected earnings growth rate of 7.4% for the current year. The Zacks Consensus Estimate for ASIX’s current-year earnings has been revised 5.3% upward in the past 60 days.
AdvanSix beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, the average being 46.9%. ASIX has surged 83.5% over a year. The company sports a Zacks Rank #1.
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The Scotts Miracle-Gro Company (SMG - Free Report) reported a loss from continuing operations of $50 million or 90 cents per share in first-quarter fiscal 2022 (ended Jan 1, 2022) compared with a profit of $25.2 million or 43 cents per share in the year-ago quarter.
Barring one-time items, the adjusted loss was 88 cents per share against earnings of 39 cents a year ago. The figure was wider than the Zacks Consensus Estimate of a loss of 81 cents.
Net sales fell 24.4% year over year to $566 million and beat the consensus mark of $554.7 million.
Company-wide gross margin rate (as adjusted) was 21% compared with 25.5% in the year-ago quarter.
Segment Details
In the first quarter, net sales in the U.S. Consumer division declined 16% year over year to $342.4 million. The segment delivered a profit of $10.7 million against $45.3 million in the prior-year quarter.
Net sales in the Hawthorne segment declined 38% year over year to $190.6 million in the reported quarter. The segment reported a loss of $5.3 million, down 113% year over year.
Net sales in the Other segment rose 6% year over year to $33 million. The segment reported a profit of $1.3 million.
Balance Sheet
At the end of the first quarter, the company had cash and cash equivalents of $16.4 million, down 23.7% year over year. The long-term debt was $3,082.2 million, up 55.7% year over year.
Outlook
The company noted that better-than-expected results in the U.S. Consumer segment, along with additional pricing actions that will take effect in the third quarter, allowed it to raise full-year sales guidance to a range of +2% to -2%. The earlier guided range was flat to -4%.
SMG also announced plans to consolidate U.S. lighting manufacturing for Hawthorne into a single location and to close another recently acquired assembly facility and move those operations to its Santa Rosa, CA site. A restructuring charge of up to $5 million is projected to be recorded in the second quarter and will be excluded from the company’s full-year adjusted results.
Price Performance
Shares of Scotts Miracle-Gro have declined 38.9% in the past year against a 22.4% rise of the industry.
Zacks Rank & Key Picks
Scotts Miracle-Gro currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the basic materials space are Albemarle Corporation (ALB - Free Report) , Nutrien Ltd. (NTR - Free Report) and AdvanSix Inc. (ASIX - Free Report) .
Albemarle, currently sporting a Zacks Rank #1 (Strong Buy), has an expected earnings growth rate of 51.3% for the current year. The Zacks Consensus Estimate for ALB's earnings for the current year has been revised 5.4% upward in the past 60 days. You can see the complete list of today’s Zacks #1 Rank stocks here.
Albemarle beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, the average being 22.1%. ALB has rallied around 39.1% over a year.
Nutrien, sporting a Zacks Rank #1, has a projected earnings growth rate of 53.8% for the current year. The Zacks Consensus Estimate for NTR's current-year earnings has been revised 17.4% upward in the past 60 days.
Nutrien beat the Zacks Consensus Estimate for earnings in three of the last four quarters while missing once. It has a trailing four-quarter earnings surprise of roughly 73.5%, on average. NTR has rallied around 42% in a year.
AdvanSix has a projected earnings growth rate of 7.4% for the current year. The Zacks Consensus Estimate for ASIX’s current-year earnings has been revised 5.3% upward in the past 60 days.
AdvanSix beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, the average being 46.9%. ASIX has surged 83.5% over a year. The company sports a Zacks Rank #1.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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