Scotts Miracle-Gro fiscal 1Q loss widens

Published:

MARYSVILLE, Ohio (AP) -- Scotts Miracle-Gro Co. reported a larger fiscal first-quarter loss Tuesday as the consumer lawn and garden products company took steps to shift sales for one of its segments out of the quarter to coincide with start of the planting season.

Its revenue fell but still beat Wall Street estimates. Its shares rose $2.46, or 5 percent, to $51.51 in morning trading.

Scotts said it normally reports a fiscal first-quarter loss due to the seasonal nature of the lawn and garden business. Sales for its Global Consumer business dropped 21 percent to $149.1 million. The company said that was expected as it worked with retailers to move product shipments closer to the start of the lawn and garden season.

The Marysville, Ohio, company reported a net loss of $73.9 million, or $1.21 per share, in the three months that ended Dec. 31. That compares to a net loss of $67.9 million, or $1.02 per share, in the previous year's quarter, when results also included a $1.2 million loss from discontinued operations.

The adjusted loss, which excludes costs tied to product registrations, recall matters and a restructuring, was $1.18 per share. Analysts surveyed by FactSet expected a loss of $1.21 per share. They typically exclude one-time items from their estimates.

Revenue fell 8 percent to $211.2 million from $230.2 million a year ago. Analysts expected $201.5 million in revenue.

Sales for its Scotts LawnService business grew 1 percent to $37.6 million in the quarter.

Selling, general and administrative expenses fell 14 percent to $123 million.

But Scotts interest expense grew to $15.3 million from $9.5 million due to an increase in average borrowings and the impact of higher rates tied to a new financing structure.

The company said it expects sales growth from continuing operations of at least 6 percent for the year, and said it would provide more details on its full-year outlook at its annual analysts' day event on Feb. 14.