Newell Rubbermaid Q1 Profit Declines, Hikes Dividend

(RTTNews) - Consumer and commercial products company Newell Rubbermaid, Inc. (NWL) Friday reported a lower first-quarter profit, as sales declined mainly due to a product recall in its Baby & Parenting segment. Normalized earnings, excluding items, topped analysts' expectations, while revenues missed view. The board has also approved a 13 percent increase in quarterly dividend.

Looking ahead, the company expects its core sales and earnings per share growth to accelerate through the remainder of the year.

In February, Graco announced a voluntary recall in the U.S. of harness buckles used on about 4 million toddler car seats manufactured between 2006 and 2013. These toddler car seat buckles were susceptible to contamination from food, debris or spilled liquids, which can result in difficulty or inability to open the buckles.

The company expects the infant harness buckle discussions with the National Highway Traffic Safety Administration, or NHTSA, will be resolved in the second quarter.

For the first quarter, the Atlanta, Georgia-based maker of Sharpie pens and Rubbermaid containers posted net income of $52.9 million, down from $54.2 million in the previous year. Meanwhile, earnings per share remained flat with last year at $0.19.

Earnings from continuing operations were $0.18, lower than $0.22 per share last year. On a normalized basis, excluding items, earnings per share remained flat year-on-year at $0.35.

On average, 16 analysts polled by Thomson Reuters expected earnings per share of $0.32 for the quarter. Analysts' estimates typically exclude one-time items.

According to the company, lower restructuring costs and positive impact from a lower share count were offset by $0.09 per share monetary asset devaluation charge resulting from the adoption of SICAD I Venezuelan Bolivar exchange rate and $0.02 per share reflecting costs associated with the harness buckle recall issue.

Restructuring costs for the quarter were $0.05, down from $0.12 per share a year go.

Net sales for the quarter edged down 0.7 percent to $1.23 billion from $1.24 billion a year ago. Analysts estimated revenues of $1.24 billion for the quarter.

However, core sales, excluding the impact of changes in foreign currency, improved 0.7 percent.

Gross margin was 38.1 percent, compared to 38.2 percent a year ago. Normalized gross margin improved 60 basis points to 38.8 percent.

For full year 2014, the company still expects normalized earnings per share of $1.94 to $2.00 and core sales growth if 3 to 4 percent. The firm continues to expect operating margin improvement of up to 40 basis points.

Street currently is looking for full-year earnings of $1.98 per share, on revenues of $5.83 billion.

Further, the company said its board has approved a quarterly dividend of $0.17 per share, up 13 percent from last year,

NWL closed Thursday's regular trading at $30.04, down 0.23 percent.