Monday, lubricants and cleaning products maker WD-40 Co. (WDFC), reported an increase in profit for the first quarter on better gross margins despite the decline in sales.
According to the company, net income for the first quarter increased to $9.41 million or $0.56 per share from $7.68 million or $0.46 per share in the year-ago period.
On average, four analysts polled by Thomson Reuters estimated earnings of $0.51 per share. Analysts' estimates typically exclude special items.
The San Diego, California-based company said that sales for the quarter declined by 7.0% to $77.7 million from $83.58 million in the comparable period a year-ago. Four Wall Street analysts estimated a revenue of $81.28 million for the quarter.
Product-wise, first quarter multi-purpose maintenance products sales, which include the WD-40 and 3-IN-ONE brands declined by 7.9% to $60.7 million from the same quarter last year while Homecare and cleaning products sales, which include all other brands, declined by 3.8% to $17.0 million from the first quarter last year.
Geographic area-wise, Americas first quarter sales declined by 4.0% to $43.7 million year-over-year, while Europe sales were down by 9.6% to $27.2 million. Sales in the Asia-Pacific region declined by 14.4% year-over-year to $6.8 million.
WD-40 said that the first quarter gross margin rose to 51.4% from 46.3% in the same quarter last year.
According to the company, the cost of products sold for the quarter declined to $37.80 million from $44.86 million a year-ago and total operating expenses, which include selling, general and administrative expenses, advertising and sales promotion and amortizaiton of definite-lived intangible assets declined to $25.18 million from $26.65 million in the year-ago period.
According to the company, foreign currency exchange rates negatively affected net sales by $1.8 million and net income by $0.3 million during the quarter.
The company said that as previously announced, its board declared on December 8, 2009 the regular quarterly dividend of $.25 per share, payable January 29, 2010 to stockholders of record on January 8, 2010.
Additionally, WD-40 company also announced that on December 8, 2009, the board authorized an open-ended buy back of company shares up to $15 million over the next 12 months.
WD-40 company reiterated that it expects fiscal year 2010 earnings to be in the range of $1.80 to $1.95 per share. The company expects net sales to grow 2%-9% to $298-$318 million during the year.
Four Wall Street analysts estimate earnings of $1.92 per share on revenue of $305.42 million for fiscal 2010.
WDFC closed Monday's last trade on the Nasdaq at $32.50, up $0.62 or 1.94%. In the afterhours the stock traded down $0.78 or 2.45%.
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