Newell Brands asserted that its turnaround plans were taking hold, as its fourth quarter and fiscal year results reflected a decline in sales but progress in its transformation initiatives.
In the fourth quarter, net sales were $2.6 billion, a 3.1% decline compared to the prior year period. The company reported net income of $794 million, or $1.87 diluted earnings per share, compared with $184 million, or $0.41 diluted earnings per share, in the prior year period, with the year over year change largely reflecting a more favorable tax benefit compared with the prior year.
The appliances and cookware segment generated net sales of $570 million in the fourth quarter compared with $604 million in the prior year period, due to the impact of unfavorable foreign exchange and a core sales decline of 4.6%. Reported operating income was $58 million compared with an operating loss of $46 million in the prior year period.
For the full fiscal year, overall net sales ended December 31, 2019 were $9.7 billion, a decline of 4.3% compared with $10.2 billion in the prior year. Core sales decreased 1.9%.
Reported net income in the fiscal year was $107 million compared with a net loss of $6.9 billion in the prior year. Reported diluted earnings per share were $0.25 compared with a reported diluted loss per share of $14.65 in the prior year.
“2019 was an important year of inflection for Newell Brands,” said Ravi Saligram, president and CEO, Newell Brands. “We developed a turnaround framework and delivered consistently against our goals in the early stages of the turnaround. Four of our eight business units delivered core sales growth in 2019, our international business returned to growth, we generated operating margin improvement of 50 bps reflecting diligent cost management and we more than doubled free cash flow. We’ve strengthened the executive leadership team through an expanded role for Chris Peterson, the previously announced hiring of Steve Parsons as chief human resources officer, and the addition of two new key executives, Mike McDermott and Kris Malkoski, each of whom bring unique strengths and relevant backgrounds to galvanize the organization to win in the marketplace. In 2020, we will be laser focused on positioning the company for sustainable and profitable growth through clarity and stability of direction, strengthening the innovation funnel across the portfolio, striving for excellence in ecommerce and social marketing and executing flawlessly in the marketplace.”
Newell Brands also appointed Chris Peterson as chief financial officer and president, business operations, effective immediately. Peterson’s expanded role will include oversight of supply chain, procurement, investor relations and IT. Peterson joined Newell Brands in 2018 as CFO and served as interim CEO from June 2019 to October 2019.
On January 24, Mike McDermott joined Newell Brands as business unit CEO for commercial, which includes the Rubbermaid Commercial Products, MAPA/Spontex and Quickie brands. McDermott joined the company from Bass Pro Shops, where he served as president, omnichannel retail. Prior to that he was evp/chief customer officer at Lowe’s.
Kristine (Kris) Malkoski will join Newell Brands on February 17 in the role of business unit CEO for food, comprising the Rubbermaid, Sistema, FoodSaver and Ball brands. Malkoski joins the company from Arc International, where she served as CEO for the Americas. Previously she held various roles of increasing responsibility at World Kitchen, including president, global business and chief commercial officer.