Newell Rubbermaid has announced its fourth quarter 2014 and full year financial results.
The company reported that its net sales in the fourth quarter were $1.53 billion compared with $1.47 billion in the prior year. Reported gross margin was 37.6%, a 60 basis point improvement versus prior year. Normalized gross margin was 37.7%, a 70 basis point improvement versus prior year, as benefits from productivity, pricing and favorable segment mix more than offset input cost inflation and the impact of negative foreign currency, the company reported.
Normalized net income was $135.3 million, compared with $132.5 million in the prior year. Normalized diluted earnings per share were $0.49, an increase of 6.5% versus $0.46 in the prior year. The improvement was attributable to increased core sales, gross margin expansion, contribution from acquisitions, and the positive impact of fewer outstanding shares, partially offset by a higher tax rate, negative foreign currency impacts and a significant increase in advertising and promotion support. Operating cash flow was $290.8 million compared with $304.2 million in the prior year period.
Home Solutions net sales were $458.6 million, a 10.8% increase compared to the prior year. The Ignite Holdings, LLC and bubba brands, inc. acquisitions contributed net sales of $55.5 million. Core sales declined 1.8%, as pricing and innovation were more than offset by planned declines on certain lower margin Rubbermaid product lines, the company reported. Normalized operating income was $60.7 million versus $57.4 million in the prior year. Normalized operating margin decreased 70 basis points to 13.2% of sales as a result of inflation, the negative impact of foreign currency and increased advertising and promotion spending.
“We are pleased to have finished the year with a strong set of fourth quarter results. Core sales grew 3.3% or nearly 4% when adjusted for timing shifts related to SAP implementation and our third quarter distribution center transition,” said Michael Polk, president and CEO, Newell Rubbermaid.
“[We have raised our] full year guidance on core sales growth to 3.5% to 4.5%. Our growth momentum is building, driven by a terrific pipeline of new innovations, our plans to increase marketing investment again, and the sustained strong performance of our recent acquisitions,” he added.
Newell Rubbermaid’s net sales for the full year ended December 31, 2014 were $5.73 billion, an increase of 2.1% compared with $5.61 billion in the prior year. Core sales increased 3% for the full year, despite the 40 basis point negative impact of exiting approximately $25 million of EMEA business. Reported net income was $377.8 million as compared with $474.6 million in the prior year. Reported EPS was $1.35 per diluted share as compared with $1.63 per diluted share in the prior year.