Fortune Brands Home & Security, Inc. (NYSE: FBHS), an industry-leading home and security products company, today announced second quarter 2013 results and raised its annual outlook for sales and earnings per share. The Company has also completed a strategic acquisition in the cabinet segment, paid its first quarterly dividend and extended the maturity of its existing credit agreement.
“We continue to leverage the market recovery with strong second quarter results,” said Chris Klein, chief executive officer, Fortune Brands Home & Security. “We developed solid momentum in the first half of the year by focusing on profitable growth. Based on our strong first half performance, our continued confidence in the home products market, and our efficient closing of the WoodCrafters acquisition, we are again increasing our annual outlook.”
Second Quarter 2013
For the second quarter of 2013, net sales were $1.04 billion, an increase of 11 percent over the second quarter of 2012. Diluted earnings per share were $0.37, compared to $0.29 in the prior year quarter. Diluted EPS before charges/gains was $0.41, compared to $0.29 the prior year.
Operating income was $106.5 million, compared to $72.3 million in the prior year quarter. Operating income before charges/gains was $107.2 million, compared to $72.7 million the prior year.
“Sales were up double digits in each of our home segments, with these segments growing a combined 13 percent vs. last year, once again outperforming the market. Importantly, this was very profitable growth, with operating income before charges/gains increasing 54 percent for the home product segments. New housing construction continued at a strong pace, and spending on home repairs and remodeling continued to strengthen,” Klein said.
For each segment in the second quarter 2013, compared to the prior-year quarter:
Company Raises Annual Outlook for 2013
- Kitchen & Bath Cabinetry net sales were up 13 percent, with operating income before charges/gains of $35.3 million vs. $18.5 million last year. Growth and share gains were driven across all parts of the business, with new construction leading the momentum and our semi-custom products benefitting more broadly from increasing repair and remodel spending.
- Plumbing & Accessories net sales were up 15 percent, and operating income before charges/gains was up 29 percent with share gains across the business.
- Advanced Material Windows & Door Systems net sales were up double digits, as entry doors grew 15 percent, and we began to see some positive signs in windows. Importantly, operating income before charges/gains for the segment more than doubled to $10 million.
- Security & Storage net sales were relatively even with prior year, with a security sales increase of 4 percent, offset by lower tool storage sales as we reposition that business. Segment operating income before charges/gains was up 25 percent.
Based on the Company’s first half performance, its continued confidence in the home products market recovery and expectation to continue outperforming the market, plus growth from the recently closed WoodCrafters acquisition, the Company now expects full-year 2013 net sales to increase 13 to 15 percent. The Company now expects diluted EPS before charges/gains to be in the range of $1.35 to $1.43, which includes $0.04 from the WoodCrafters acquisition. This targeted range compares to 2012 diluted EPS before charges/gains of $0.89.