The Newell Professional segment posted third quarter net sales of $535.4 million, a 1.1 percent decline from the prior year. Core sales growth for the segment was 2.5 percent against very strong core sales growth in the year ago period of 7.5 percent. Year-to-date core sales growth in this segment was 4.3 percent. The Commercial Products global business unit contributed to strong Professional core sales in North America and Latin America. Core sales in Europe, Australia and New Zealand came in below expectations, as order patterns slowed due to macroeconomic pressures. The segment’s normalized operating income was $70.6 million, or 13.2 percent of sales, as compared with $84.5 million, or 15.6 percent of sales, in the prior year. The decline in operating margin reflects the sustained investment in selling and marketing resources in our Win Bigger Professional businesses as well as sourced goods inflation.
Third quarter net sales in the Baby & Parenting segment were $185.3 million, a 5.2 percent improvement over the prior year. Core sales increased 7.8 percent, driven by continued strong performance by the Graco ® brand in North America and the Aprica ® brand in Japan. Year-to-date, the Baby & Parenting segment generated 11.2 percent core sales growth. Third quarter normalized operating income was $18.3 million, or 9.9 percent of sales, compared with $17.7 million, or 10.0 percent of sales, in the prior year.
Expansion of Project Renewal
Today, the company announced an expansion of its Project Renewal restructuring program.The expansion of Project Renewal is expected to generate incremental annualized cost savings of approximately $180 to $225 million when fully implemented by the end of the second quarter of 2015. The majority of these savings will be reinvested in programming to accelerate growth and in strengthening brand building and selling capabilities in priority markets around the world. The company expects to incur incremental cash costs of $225 to $250 million and record pretax restructuring charges of $250 to $275 million over the same period.