Scotts Miracle-Gro (SMG - Get Report) rose more than 8% after the lawn and garden care company reported stronger-than-expected performance from its Hawthorne and U.S. consumer segments in the third quarter.
For the quarter ended June 29, company-wide sales rose 18% to $1.17 billion from $994.6 million a year earlier. GAAP income from continuing operations was $3.15 a share, compared with $2.23 in the prior year.
Non-GAAP adjusted earnings, which excludes one-time items, were $3.11 a share, compared with $2.67 a year ago. The results exceeded analysts' consensus predictions, which had been $2.74 a share and $1.07 billion in revenue.
The company also increased its full-year projections for the second time in fiscal 2019, saying it now expects non-GAAP adjusted earnings in a range of $4.35 to $4.50 a share on projected sales growth of 16% to 17%.
"Fiscal 2019 continues to deliver outstanding results as nearly every aspect of our business is exceeding our expectations," said Jim Hagedorn, chairman and CEO. Hagedorn said the strong recovery in the Hawthorne segment was led by increased sales of lighting and nutrients products.
The company also announced that Monsanto agreed to purchase four of its Roundup-branded product lines, as well as the right to use the Roundup brand (previously licensed to Scotts by Monsanto) for $112 million. Scotts Miracle-Gro will act as marketing agent for these brand extension product lines and the companies will equally share future profits, which are expected to be approximately $15 million in fiscal 2019.
Shares were up 8.43% to $112 in trading Wednesday.
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