Scotts Miracle-Gro (SMG) Misses Q2 EPS by 43c, Sales Miss; Earnings Guidance Unchanged

Scotts Miracle-Gro (NYSE: SMG) reported Q2 EPS of $2.88, $0.43 worse than the analyst estimate of $3.31. Revenue for the quarter came in at $1.01 billion versus the consensus estimate of $1.08 billion.

“The start to this lawn and garden season has been delayed to a greater extent than we have seen in recent memory,” said Jim Hagedorn, chairman and chief executive officer. “Consumer purchases entering May are down double digits from a year ago. However, in the markets like California and Florida, where the weather has cooperated, consumer purchases are in line with last year’s results and we’ve seen an enthusiastic response to our new products. We’ve begun to see momentum picking up in the Midwest and Northeast in recent weeks as the weather has turned more favorable, making us optimistic that we can quickly make up ground and finish the season as strong as possible.”

Earnings guidance unchanged

The Company made no changes to its previously stated earnings guidance, but reminds investors that its planned acquisition of Sunlight Supply, Inc. is expected to reduce non-GAAP adjusted earnings by $0.30 to $0.40 per share in fiscal 2018. The Company expects to adjust its full-year guidance after the transaction closes, which is expected to occur by June 1.

“The slow start to the season and the declines at Hawthorne create challenges for us as we navigate the balance of fiscal 2018,” Coleman said. “However, given the amount of consumer activity still in front of us, it is too early to revise our expectations. We currently anticipate providing the investment community an updated outlook for fiscal 2018 in mid-June, a practice consistent with how we have operated in the past.”

For earnings history and earnings-related data on Scotts Miracle-Gro (SMG) click here.

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