Spectrum Brands continued on a growth track in its fourth quarter, with sales accelerating across all of the company’s business units including in its home and personal care division.
Net sales increased 17.9% to $1.2 billion in the fourth quarter ended September 30, 2020, compared to $993 million in the previous fourth quarter.
Net income was $43.8 million and diluted earnings per share of $1.01 compared to a loss of $79 million and a loss of $1.62 diluted earnings per share in last year’s fourth quarter.
In the company’s home and personal care division, net sales were driven by growth in both small appliances and personal care. This included strong net sales growth in the U.S. from e-commerce and mass channels and small appliances category performance, with continued strength in convenience cooking including new product introductions from George Foreman grills. Excluding favorable foreign exchange impacts of $0.5 million, organic net sales grew 5.6%. Net sales were $302.3 million compared to net sales of $285.8 million in last year’s fourth quarter.
David Maura, chairman and CEO of Spectrum Brands, said, “Our Q4 and full year financial results reflect a better, faster and stronger Spectrum Brands, with net sales, operating income and adjusted EBITDA growth. During the quarter, our net sales accelerated as we grew 17.9%, with strong growth across all business units. These top line results reflect elevated demand levels, with strong POS and improved output. This is evidence of our quick recovery from COVID-19 related supply disruptions earlier in the year. Additionally, our incremental marketing and advertising investments are paying dividends by driving stronger organic top line growth. Operating Income and Adjusted EBITDA growth was driven by strong volumes and improved gross margins. Adjusted EBITDA in Q4 2020 includes a change to our annual incentive compensation program converting to cash payment from a mix of equity and cash in order to better align with industry best practices and our peer group. This change negatively impacts comparability, with $17 million in incremental corporate expense in the quarter. If not for the change, we would have delivered $190 million in adjusted EBITDA this quarter and $597 million in the full year.”
Maura added, “We believe we are better positioned today than we have ever been to drive demand as a home essentials company with consumers needing our brands and products more than ever. Additionally, with the supply chain disruptions from COVID-19 earlier in 2020 largely behind us, momentum in the business remains strong, and with continued strong demand in October, fiscal 2021 is off to a great start.”