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Sales Rise 5% and Earnings Meet Company Expectations
Beam Sales Increase 11% to a Record on Broad-Based Global Share Gains
Home & Security Continues to Outperform Market
Fortune Brands, Inc. (NYSE: FO) today reported results for the second quarter of 2011.
Net sales from continuing operations, which excludes the recently divested golf business, were $1.59 billion, up 5%.
Diluted earnings per share from continuing operations were $0.65, and diluted EPS before charges/gains was $0.71 versus $0.74 in the year-ago quarter.
Including results from the divested golf unit, sales would have been $1.99 billion and diluted EPS before charges/gains would have been $0.93 for the quarter.
“As we approach the planned separation of our two remaining businesses, both Beam and Home & Security are outperforming their markets and will be ready to hit the ground running on Day One as independent companies,” said Bruce Carbonari, chairman and chief executive officer of Fortune Brands. “As expected, EPS before charges/gains for the second quarter was modestly lower due to the challenging comparisons we highlighted three months ago: the 10-15 cents per share benefit to the year-ago quarter primarily from the mid-2010 expiration of the U.S. homebuyer tax credit; higher year-over-year costs for raw materials and transportation; and the impact in the current-year period of our double-digit increase in strategic spend to support profitable long-term growth.
“Beam achieved record second quarter sales with gains across its three geographic regions,” Carbonari said. “Notably, our investments in innovation and brand building are paying off in profitable share gains, and we’re further stepping up our brand investment as a result. The Jim Beam brand accelerated its momentum in the quarter, Maker’s Mark continued its double-digit growth, and our distribution muscle is fueling explosive growth for the Skinnygirl cocktails brand we acquired in March. In fact, Skinnygirl has already become the fastest-growing spirits brand in America, and we’re planning to build on its success with innovations like the new Skinnygirl Sangria. Spirits operating income growth trailed top-line growth, as anticipated, due principally to our strong double-digit increase in brand investment and the startup costs associated with new product launches.”