Third quarter net sales at Helen of Troy were flat as growth in its housewares segment offset declines in the company’s other key product categories.
For the three-month period ended November 30, 2016, total company sales were $444.4 million, down 0.2% from the comparable quarter the previous year. Net income for the quarter was $57.6 million, or $2.07 per diluted share, compared to $46.8 million, or $1.63 per diluted share for the same period the prior year.
“Our transformation strategy, combined with the ongoing benefits of our diversified business model, led to a strong quarter of profitability highlighted by a 270 basis point increase in gross profit margin and a 14.5% increase in adjusted EPS,” said Julien Mininberg, CEO, Helen of Troy.
Housewares net sales increased by 42% driven by net sales growth of 39.1% from Hydro Flask and a 2.9% increase in core business net sales revenue. In the core business, company officials said growth was fueled by new products and expansion in the club channel, partially offset by a decline in EMEA sales due to the negative impact of the weakened British Pound.
Health and home net sales declined 3.5% reflecting the company’s de-emphasis of lower margin hot/cold therapy business and declines in humidification due to retailers exiting last year’s below average cough/cold/flu season with higher inventory levels. These declines were partially offset by strong sales gains in PUR water filtration, early seasonal shipments of thermometry products, and growth in air purification.
Beauty net sales decreased 19.5%, which includes anticipated declines of 5.3% and 2%, respectively, from the company’s Venezuelan and North American personal care businesses, and the negative impact of approximately 1.5% from foreign currency fluctuations. Another 2% of the decline is due to the company’s de-emphasis of the foot care category, as it has become commoditized, officials said.
The company also announced that Thurman Case has joined the Helen of Troy Board as of January 1; and that Jay Caron will join the company as chief supply chain officer effective January 9.