Newell Brands Inc. (NYSE: NWL) announced it will reaffirm its
outlook for fiscal years 2016 and 2017, as provided in its third
quarter 2016 earnings press release dated October 28, 2016, during
its presentation tomorrow at the Morgan Stanley Global Consumer
& Retail Conference.
Chief Executive Officer Michael Polk will present Tuesday,
November 15, at 8:00 a.m. ET. The presentation will be webcast live
and may be accessed through Events & Presentations in the
Investor Relations section of the Newell Brands website at
www.newellbrands.com. The webcast will be archived and available
for replay following the live presentation.
The company is reaffirming its full year 2016 guidance as
follows:
2016 Full Year
Outlook Reported net sales growth 122.5% to
128.0% Reported earnings per share $1.15 to $1.20
Core sales growth 3.5% to 4.0% Normalized earnings per share
$2.85 to $2.90
As of April 15, 2016, Newell Brands core sales include pro forma
core sales associated with the Jarden transaction as if the
combination occurred April 15, 2015. Core sales exclude the impact
of foreign currency, acquisitions (other than the Jarden
acquisition) until their first anniversary and planned and
completed divestitures (including the deconsolidation of
Venezuela). Newell Brands expects to exit product lines with annual
sales of $75 million to $125 million by the end of 2018, which will
be reflected as a negative impact on core sales. Beginning with the
second quarter of 2016, the company is excluding the amortization
of intangible assets associated with acquisitions from its
calculation of normalized earnings per share.
The company is reaffirming its full year 2017 guidance as
follows:
2017 Full Year
Outlook Core sales growth 3% to 4%
Normalized earnings per share $2.85 to $3.05
2017 normalized earnings per share outlook includes $0.20 of
dilution, net of interest benefits, related to the planned
divestiture of about 10 percent of the company’s portfolio. The
2017 guidance assumes a January 1, 2017 completion of divestitures
of all businesses designated as held for sale.
The company has presented forward-looking statements regarding
normalized earnings per share and core sales growth for 2017, each
of which is a non-GAAP financial measure. These non–GAAP financial
measures are derived by excluding certain amounts, expenses or
income and/or certain impacts, including the impact of foreign
exchange or business portfolio determinations, from the
corresponding financial measures determined in accordance with
GAAP. The determination of the amounts that are excluded from these
non-GAAP financial measures is a matter of management judgment and
depends upon, among other factors, the nature of the underlying
expense or income amounts recognized in a given period. We are
unable to present a quantitative reconciliation of the
aforementioned forward-looking non-GAAP financial measures to their
most directly comparable forward-looking GAAP financial measures
because such information is not available and management cannot
reliably predict all of the necessary components of such GAAP
measures without unreasonable effort or expense. The unavailable
information could have a significant impact on the company's
full-year 2017 GAAP financial results.
About Newell Brands
Newell Brands (NYSE: NWL) is a leading global consumer goods
company with a strong portfolio of well-known brands, including
Paper Mate®, Sharpie®, Dymo®, EXPO®, Parker®, Elmer’s®, Coleman®,
Jostens®, Marmot®, Rawlings®, Oster®, Sunbeam®, FoodSaver®, Mr.
Coffee®, Rubbermaid Commercial Products®, Graco®, Baby Jogger®,
NUK®, Calphalon®, Rubbermaid®, Contigo®, First Alert®, Waddington
and Yankee Candle®. For hundreds of millions of consumers, Newell
Brands makes life better every day, where they live, learn, work
and play.
This press release and additional information about Newell
Brands are available on the company’s website,
www.newellbrands.com.
Non-GAAP Financial
Measures
This release contains non-GAAP financial measures within the
meaning of Regulation G promulgated by the Securities and Exchange
Commission and includes a reconciliation of these non-GAAP
financial measures to the most directly comparable financial
measures calculated in accordance with GAAP.
The company uses certain non-GAAP financial measures that are
included in this press release and the additional financial
information both in explaining its results to stockholders and the
investment community and in its internal evaluation and management
of its businesses. The company’s management believes that these
non-GAAP financial measures and the information they provide are
useful to investors since these measures (a) permit investors to
view the company’s performance using the same tools that management
uses to evaluate the company’s past performance, reportable
business segments and prospects for future performance and (b)
determine certain elements of management’s incentive
compensation.
The company’s management believes that core sales provides a
more complete understanding of underlying sales trends by providing
sales on a consistent basis as it excludes the impacts of
acquisitions (other than the Jarden acquisition, which is included
in core sales on a pro forma basis starting in the second quarter
of 2016), planned or completed divestitures, the deconsolidation of
the company’s Venezuelan operations and changes in foreign currency
from year-over-year comparisons. The effect of foreign currency on
reported sales is determined by applying a fixed exchange rate,
calculated as the 12-month average in the prior year, to the
current and prior year local currency sales amounts (excluding
acquisitions and divestitures), with the difference in these two
amounts being the increase or decrease in core sales, and the
difference between the change in as reported sales and the change
in constant currency sales reported as the currency impact. The
company’s management believes that “normalized” earnings per share,
which exclude restructuring and other expenses and one-time and
other events such as costs related to certain product recalls, the
extinguishment of debt, certain tax benefits and charges,
impairment charges, pension settlement charges, discontinued
operations, costs related to the acquisition, integration and
financing of acquired businesses, amortization of intangible assets
associated with acquisitions (beginning in the second quarter of
2016), advisory costs for process transformation and optimization
initiatives, costs of personnel dedicated to integration activities
and transformation initiatives under Project Renewal and certain
other items, are useful because they provide investors with a
meaningful perspective on the current underlying performance of the
company’s core ongoing operations.
The company determines the tax effect of the items excluded from
normalized diluted earnings per share by applying the estimated
effective rate for the applicable jurisdiction in which the pre-tax
items were incurred, and for which realization of the resulting tax
benefit, if any, is expected. In certain situations in which an
item excluded from normalized results impacts income tax expense,
the company uses a “with” and “without” approach to determine
normalized income tax expense.
While the company believes that these non-GAAP financial
measures are useful in evaluating the company’s performance, this
information should be considered as supplemental in nature and not
as a substitute for or superior to the related financial
information prepared in accordance with GAAP. Additionally, these
non-GAAP financial measures may differ from similar measures
presented by other companies.
Reconciliation of Non-GAAP Financial
Measures
Reconciliations of the 2016 core sales growth and normalized
earnings per share outlooks are as follows:
Year Ending
December 31, 2016
Estimated net sales growth (GAAP) 122.5 % to
128.0 % Less: Jarden net sales growth included in pro
forma base 115.0 % to 120.0 % Net sales growth, Adjusted Pro Forma
(1) 7.5 % to 8.0 % Less: Currency (1.0 %) to (2.0 %) Acquisitions,
net of divestitures (2) 6.0 % to 7.0 % Venezuela deconsolidation
(1.0
%)
Core Sales Growth, Adjusted Pro Forma 3.5 % to 4.0 %
(1) Adjusted pro forma reflects Jarden sales from April 16, 2016
and 2015, respectively.
(2) Acquisitions, net of divestitures represents estimated sales
of The Waddington Group, Inc., Jostens, Inc. and Elmer's Products,
Inc. until the one year anniversary of their respective dates of
acquisition, net of the impacts of the divestiture of the
Rubbermaid medical cart business in August 2015 and the divestiture
of the Levolor and Kirsch window coverings brands ("Décor") in June
2016.
Year Ending
December 31, 2016
Diluted earnings per share $ 1.15 to
$ 1.20 Tools sale - tax on basis difference $ 0.33 to
$ 0.35 Project Renewal and Project Lean restructuring and other
costs $ 0.09 to $ 0.11 Integration costs to drive synergies $ 0.28
to $ 0.32 Estimated gain on sale of Décor $ (0.24 ) Jarden
transaction-related costs, including debt/credit facility
extinguishment costs $ 0.19 to $ 0.21 Acquisition-related
amortization* and inventory step-up $ 0.98 to $ 1.00 Normalized
earnings per share $ 2.85 to $ 2.90
* Represents amortization of acquisition-related intangibles
beginning in the second quarter of 2016.
Caution Concerning Forward-Looking
Statements
Statements in this press release that are not historical in
nature constitute forward-looking statements. These forward-looking
statements relate to information or assumptions about the effects
of sales, income, earnings per share, operating income, operating
margin or gross margin improvements or declines, Project Renewal,
capital and other expenditures, cash flow, dividends, restructuring
and other project costs, costs and cost savings, inflation or
deflation, particularly with respect to commodities such as oil and
resin, debt ratings, changes in exchange rates, expected benefits
and financial results from the Jarden transaction and other
recently completed acquisitions and related integration activities
and planned divestitures and management's plans, projections and
objectives for future operations and performance. These statements
are accompanied by words such as "anticipate," "expect," "project,"
"will," "believe," "estimate" and similar expressions. Actual
results could differ materially from those expressed or implied in
the forward-looking statements. Important factors that could cause
actual results to differ materially from those suggested by the
forward-looking statements include, but are not limited to, our
dependence on the strength of retail, commercial and industrial
sectors of the economy; competition with other manufacturers and
distributors of consumer products; major retailers' strong
bargaining power and consolidation of our retail customers; changes
in the prices of raw materials and sourced products and our ability
to obtain raw materials and sourced products in a timely manner
from suppliers; our ability to develop innovative new products and
to develop, maintain and strengthen our end-user brands, including
the ability to realize anticipated benefits of increased
advertising and promotion spend; product liability, product recalls
or regulatory actions; our ability to expeditiously close
facilities and move operations while managing foreign regulations
and other impediments; a failure of one of our key information
technology systems or related controls; our ability to attract,
retain and motivate key employees; future events that could
adversely affect the value of our assets and require impairment
charges; our ability to improve productivity and streamline
operations; changes to our credit ratings; significant increases in
the funding obligations related to our pension plans due to
declining asset values, declining interest rates or otherwise; the
imposition of tax liabilities greater than our provisions for such
matters; the risks inherent in our foreign operations, including
exchange controls and pricing restrictions; our ability to execute
our new corporate strategy; our ability to complete planned
divestitures, including our ability to obtain the regulatory
approvals required to complete the Tools divestiture; our ability
to successfully integrate acquired businesses, including the
recently acquired Jarden business; our ability to realize the
expected benefits and financial results from our recently acquired
businesses and planned divestitures; and those factors listed in
our filings with the Securities and Exchange Commission
(including the information set forth under the caption “Risk
Factors” in the Company’s Annual Report on Form 10-K). Changes in
such assumptions or factors could produce significantly different
results. The information contained in this news release is as of
the date indicated. The company assumes no obligation to update any
forward-looking statements contained in this news release as a
result of new information or future events or developments.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20161114006514/en/
Newell Brands Inc.Investor
Contact:Nancy O’Donnell, +1-770-418-7723Vice President,
Investor Relationsnancy.odonnell@newellco.comorNewell Brands
Inc.Media Contacts:Tom Sanford,
+1-973-600-3880Vice President, Global
Communicationstom.sanford@newellco.comorWeber ShandwickLiz Cohen,
+1-212-445-8044liz.cohen@webershandwick.com
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