Lawn and garden care products maker Scotts Miracle-Gro (SMG) on Tuesday reaffirmed its earnings outlook for fiscal 2013, citing an increase in U.S. consumer purchases for the fiscal third quarter through early June.
Ahead of William Blair's 33rd Annual Growth Stock Conference, where its management will discuss current business strategies, Scotts Miracle-Gro reiterated its expectation for fiscal 2013 adjusted earnings from continuing operations in the range of $2.50 to $2.75 per share. The company expects full-year net sales to range from a 1 percent decrease to an increase of 1 percent compared to the prior year.
On average, analysts polled by Thomson Reuters expect the company to earn $2.53 per share for the year on revenues of $2.74 billion. Analysts' estimates typically exclude special items.
In addition, Scotts Miracle-Gro reiterated its forecast for fiscal 2013 adjusted gross margin to improve up to 125 basis points and its expectations for operating cash flow of at least $250 million.
Larry Hilsheimer, chief financial officer of Scotts-Miracle-Gro said, "U.S. consumer purchases for the fiscal third quarter are up 15% through June 9, giving us continued confidence in the earnings guidance we established heading into the year. Consumer purchases, which were down more than 25 percent on a fiscal year-to-date basis entering April, are down 4 percent through June 9."
The company now projects selling, general and administrative expenses to decline 3 percent to 5 percent for the full-year. Previously, the company expected SG&A savings of 2 percent to 3 percent for the year.
In early May, Marysville, Ohio-based Scotts Miracle-Gro reported a 21 percent decline in profit for the second quarter on double-digit decline in sales and lower margins. The company primarily attributed the decline in profit to a significant delay in the start of the lawn and garden season across nearly all North American and European markets due to a colder than normal March.
The company's net income for the second quarter was $100.0 million or $1.60 per share, lower than $127.2 million or $2.05 per share in the prior-year quarter. Net sales declined 13 percent to $1.02 billion from $1.17 billion in the same period last year.
SMG closed Monday's trading at $47.20, up $0.88 on a volume of 292,600 shares.
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