Central Garden & Pet Company Announces Fiscal 2012 Second Quarter Results
Central Garden & Pet Company (NASDAQ:CENT) (NASDAQ:CENTA), a leading
innovator, marketer and producer of quality branded products for the
lawn and garden and pet supplies markets, today reported financial
Central Garden & Pet Company (NASDAQ:CENT) (NASDAQ:CENTA), a leading innovator, marketer and producer of quality branded products for the lawn and garden and pet supplies markets, today reported financial results for its second quarter ended March 24, 2012. The Company reported second quarter net sales of $466.9 million, a decrease of 4 percent from the same period a year ago. The second quarter operating income was $45.2 million, compared to operating income of $59.6 million in the second quarter of 2011, reflecting reduced sales and a lower gross margin. Net interest expense was $10.4 million compared to $9.3 million in the year-ago period. Net income for the quarter totaled $21.6 million, or $0.45 per fully diluted share, compared with net income of $31.8 million, or $0.54 per fully diluted share, in the second quarter of 2011. “Even with strong demand from consumers for our products, our sales and earnings were impacted this quarter by short-term execution issues arising from our transformational efforts, which hindered our ability to fully meet demand,” said Bill Brown, Chairman and Chief Executive Officer. “We are addressing these issues and are continuing to see strong demand for our products. April sales are up significantly over last year, helped by delayed shipments and strong demand for our flea and tick products.” Gus Halas, President and CEO of Central Operating Companies, commented, “As is often the case with business transformations, we encountered some disruptions as we transitioned operational activities during the quarter. We have made good progress executing on our transformational plan as we create a more efficient and effective operation to support our customers and position the Company for success in the coming years.” Second Quarter and Year-To-Date Details Net sales for the Garden Products segment decreased 6 percent or $15.9 million from the same period a year ago to $244.4 million, impacted by the delay in filling orders as well as lower grass seed and wild bird feed sales. The Garden Products segment’s branded product sales were $211.7 million and sales of other manufacturers’ products were $32.7 million. In the second quarter, the Garden Products segment’s gross and operating margins declined, impacted by the mix of product sales, including lower sales of higher-margin branded control products and grass seed and higher sales of third-party products. The Garden Products segment’s operating income in the quarter was $36.6 million, compared to an operating income of $46.9 million in the second quarter of 2011.