ATLANTA-Weak sales of home products and higher costs both played a part in reducing Newell Rubbermaid’s first-quarter profit and sales.
Net income in the quarter, which ended on March 31, fell 2.4 percent to $52.9 million. Net sales were down 0.7 percent to $1.2 billion. Sales in Newell’s Home Solutions segment were down 5.2 percent, the result of the difficult weather in much of the first quarter along with reduced merchandising of certain low-margin products in the Rubbermaid Consumer sector, partially offset by increased distribution of Calphalon-branded products.
Selling, general and administrative expenses (which included a charge taken for the costs of a voluntary recall of harness buckles used on toddler car seats) rose 3.1 percent in dollars and 110 basis points as a percentage of sales, to 28.6 percent. Gross margin was cut by 10 basis points to 38.1 percent
For all of 2014, Newell said it projects core sales growth of 3 to 4 percent. Michael Polk, the company’s CEO, said, “We are confident in our full-year financial guidance and expect the company’s core sales and earnings-per-share growth to accelerate through the balance of the year, as we significantly increase advertising and promotion investment levels in support of our brands and innovation.”