ScottsMiracle-Gro Reports Fiscal 2024 Fourth Quarter and Full-Year Results
- U.S. Consumer fiscal 2024 sales up 6 percent in line with guidance; POS units up 9 percent year-over-year
- Full-year GAAP gross margin rate of 23.9 percent; Non-GAAP adjusted gross margin rate up 340 basis points excluding one-time charges of 80 basis points
- Full-year GAAP loss per share of $0.61; Non-GAAP adjusted EPS of $2.29 including one-time charges of $0.35 per share
- Company exceeds free cash flow target of $1 billion over two years through fiscal 2024; Net leverage at 4.86x
- Non-GAAP adjusted EBITDA of $510 million at high end of guidance range when excluding $29 million of one-time charges
MARYSVILLE, Ohio, Nov. 06, 2024 (GLOBE NEWSWIRE) — The Scotts Miracle-Gro Company (NYSE: SMG), the world’s largest marketer of branded consumer lawn and garden as well as a leader in indoor and hydroponic growing products, today announced its results for the full year and fourth quarter ended September 30, 2024.
“Our performance in fiscal 2024 serves as a testament to our financial turnaround,” said Jim Hagedorn, chairman, CEO and president of Scotts Miracle-Gro. “We delivered upon or exceeded the goals we set this year and returned to managing the business with an eye toward future growth and value creation.
“We’ve established a foundation for our three-year growth plan that is grounded in my mid-term priorities, and we expect to make substantial progress against these priorities in 2025. It’s important to recognize that throughout our recovery journey, we have upheld our commitment to shareholders while investing in the core strengths of our business to enhance our ability to deliver improved returns.”
Financial Results
Fourth Quarter Details
For the quarter ended September 30, 2024, total Company net sales were $414.7 million, an increase of 11 percent compared to $374.5 million a year ago. U.S. Consumer net sales increased 54 percent to $309.7 million from $201.0 million in the same period last year. U.S. Consumer segment favorability in the fourth quarter was mainly driven by normalization of shipment timing versus the same period last year.
Hawthorne segment sales decreased 46 percent, to $80.5 million, compared to $149.7 million in the fourth quarter last year, mainly driven by Hawthorne’s exit from distribution of third-party brands and a decline in sales from its professional horticultural lighting business.
GAAP and non-GAAP adjusted gross margin rates for the quarter were negative 7.1 percent and negative 3.1 percent, respectively. These compare to negative 15.2 percent and negative 8.8 percent, respectively, in the prior year with the year-over-year improvements mainly driven by fixed-cost leverage from higher sales volume. These improvements were partially offset by incremental charges of $29 million, worth 690 bps to the quarter non-GAAP rate, driven by excess and obsolete inventory write-offs associated with the previously announced wind-down of the AeroGarden indoor growing unit business.
Equity in loss of unconsolidated affiliates, which represents the Company’s share of the results of its live goods joint venture, Bonnie Plants, LLC, includes a non-cash, pre-tax impairment charge of $51.5 million recorded during the fourth quarter.
For the fourth quarter, the Company reported GAAP net loss of $244.0 million, or $4.29 per share, compared with the prior year’s fourth quarter loss of $468.4 million, or $8.33 per share. In addition to the live goods joint venture impairment, these results include pre-tax charges of $85.5 million, comprising $64.6 million of non-cash impairments of convertible debt investments related to RIV Capital, and restructuring and other charges of $20.9 million reflecting continued Project Springboard actions.
Non-GAAP adjusted net loss for the quarter, which excludes impairment, restructuring and other non-recurring items, was a loss of $131.5 million, or $2.31 per share, compared to a loss of $155.4 million, or $2.77 per share, for the same period last year.
