“Our third quarter results represent an important inflection point in our progress advancing the Growth Game Plan,” President and CEO Michael Polk said. “Core sales grew 3.3 percent and normalized EPS grew 10.6 percent to $0.52. The sequential improvement in our growth rate versus our first half results was driven by core sales growth of over 4 percent in North America and 35 percent in Latin America. Successful new product launches, expanded distribution and stronger marketing initiatives delivered market share gains in Baby & Parenting, Home Solutions and Tools. Our growth was supported by increased advertising and promotion spending funded by Project Renewal savings and disciplined discretionary cost management. This is the power of the Growth Game Plan in action.
“Concurrent with our third quarter earnings announcement, our Board has authorized a $350 million accelerated share repurchase plan. This plan reflects confidence in the future prospects for Newell Rubbermaid and is an efficient use of divestiture proceeds and current year cash flow. Our company is growing stronger each quarter and, as a result, we can deliver increased value to shareholders through the accelerated purchase of the company’s shares while simultaneously investing to drive the Growth Game Plan into action.”
Third quarter executive summary:
o Net sales were $1.49 billion, a 2.1 percent increase versus prior year results.
o Core sales, which exclude the impact of changes in foreign currency, grew 3.3 percent.
o Normalized operating margin of 14.6 percent increased 30 basis points compared with prior year. Reported operating margin declined 80 basis points.
o Normalized diluted earnings per share were $0.52, a year-over-year increase of 10.6 percent.
o Reported diluted earnings per share were $0.66 compared with $0.37 in the year-ago period due largely to a gain on disposal of the company’s Hardware business.
o Operating cash flow was $360.8 million versus $301.5 million in the prior year.
o The company paid dividends of $44.0 million and repurchased 1.8 million shares at a cost of $46.8 million, for a total of $90.8 million returned to shareholders, up 65 percent versus prior year.
o 2013 guidance is unchanged. The company continues to expect 2013 core sales growth of 2 to 4 percent, operating margin improvement of up to 20 basis points, normalized EPS of $1.80 to $1.84, and operating cash flow of $575 to $625 million.
o Newell Rubbermaid’s board approved a $350 million accelerated share repurchase plan in October.