ATLANTA-Newell Rubbermaid reported a net income increase of 29.6 percent for the first quarter of 2011, ended March 31, 2011, for a total of $75.7 million as reported.
Net sales in the first quarter were $1.30 billion, a decline of 0.3 percent compared with the prior year, which the company attributed to several timing shifts that accounted for $40 million. Adjusting for these differences, the first quarter 2011 core sales growth would have been up 1.5 percent, it said. Gross margin for the quarter was 37.7 percent, up 160 basis points from last year as pricing, favorable mix and productivity offset the impact of input cost inflation. SG&A expenses were 27.2 percent as reported for the first quarter, while it was 24.9 percent as reported for the prior year period.
“First quarter results represent a solid start to the year, especially our earnings and gross margin performance,” said Mark Ketchum, president and CEO. “We remain confident in our ability to meet our full year guidance of 4 to 5 percent core sales growth, gross margin expansion of 50 to 75 basis points and normalized EPS growth of 10 to 12 percent. Our international businesses led the way, building on already strong momentum, with core sales growth of almost 5 percent. Developing markets, where we have substantially increased our focus and investment, grew double digits in the first quarter.”
“Our topline performance fell short of expectations driven mainly by consumer trade down behavior and reduced promotional activity affecting two key businesses,” added Ketchum. “We are taking steps to respond to these trends by introducing additional value priced items and restoring promotional activity behind our new product launches. These actions, in concert with already strong growth trends in our other businesses, give us confidence in our full year growth projections.”