Central Garden & Pet Revises Outlook for Fiscal 2022 GAAP EPS
June 22 2022 - 9:05AM
Business Wire
Fiscal 2022 GAAP EPS now expected to be at
or above prior year Lower outlook driven primarily by poor
Garden season Confident in Central to Home Strategy and
long-term profitable growth in Pet and Garden
Central Garden & Pet Company (NASDAQ: CENT)
(NASDAQ: CENTA) (“Central”), a market leader in the Garden and Pet
industries, today announced that despite favorable long-term
industry trends, several factors have led the Company to lower its
outlook for fiscal 2022 GAAP EPS.
“The operating environment continues to be extremely
challenging, with high inflation and geopolitical developments
unfavorably impacting commodities, labor and freight, significant
pricing actions and growing economic uncertainty. As we indicated
in early May, the garden season had a late start. Poor weather
conditions continued and that, coupled with reduced foot traffic
and changing inventory expectations from our customers, led to
softness across most of our Garden portfolio, driving the vast
majority of the revised guidance,” said Tim Cofer, CEO of Central
Garden & Pet.
“While it’s disappointing to not deliver on our original
outlook, we nonetheless expect to deliver GAAP EPS at or above
prior year, despite the uncertain and inflationary economic
environment and two years of extraordinary growth. Importantly, we
are confident our Central to Home strategy and the investments we
are making will drive profitable long-term growth and allow us to
capture opportunities in both the Pet and Garden industries.”
The Company now expects fiscal 2022 GAAP EPS to be at or above
prior year GAAP EPS of $2.75. The outlook takes into account
increasing costs for commodities and freight, exacerbated by the
current geopolitical environment, labor and a return to more
normalized consumer demand patterns following extraordinary demand
spanning two fiscal years. This guidance further includes
anticipated pricing actions across the Company’s portfolio as well
as investments in capacity expansion, brand building, consumer
insights, innovation and eCommerce to drive sustainable growth.
This outlook does not include the impact of acquisitions that may
close during fiscal 2022.
The Company will provide further details during its fiscal 2022
Q3 earnings call scheduled for August 3, 2022.
About Central Garden & Pet
Central Garden & Pet (NASDAQ: CENT) (NASDAQ: CENTA)
understands that home is central to life and has proudly nurtured
happy and healthy homes for over 40 years. With fiscal 2021 net
sales of $3.3 billion, Central is on a mission to lead the future
of the Pet and Garden industries. The Company’s innovative and
trusted products are dedicated to helping lawns grow greener,
gardens bloom bigger, pets live healthier and communities grow
stronger. Central is home to a leading portfolio of more than 65
high-quality brands including Pennington, Nylabone, Kaytee, Amdro
and Aqueon, strong manufacturing and distribution capabilities and
a passionate, entrepreneurial growth culture. Central Garden &
Pet is based in Walnut Creek, California and has over 7,000
employees across North America and Europe. For additional
information about Central, please visit www.central.com.
Safe Harbor Statement
“Safe Harbor” Statement under the Private Securities Litigation
Reform Act of 1995: The statements contained in this release which
are not historical facts, including earnings guidance for fiscal
2022, expectations for increased levels of investment to drive
capacity expansion, brand building and eCommerce, increases in
labor and freight cost as well as key commodities, the accretive
expectations for recent acquisitions, a return to more normalized
consumer demand patterns, in addition to resuming more normal
levels of travel, and their impact on future growth, are
forward-looking statements that are subject to risks and
uncertainties that could cause actual results to differ materially
from those set forth in or implied by forward-looking statements.
All forward-looking statements are based upon the Company’s current
expectations and various assumptions. There are a number of risks
and uncertainties that could cause our actual results to differ
materially from the forward-looking statements contained in this
release including, but not limited to, the following factors:
- inflation and other adverse macro-economic conditions;
- fluctuations in market prices for seeds and grains and other
raw materials;
- our ability to successfully manage the continuing impact of
COVID-19 on our business, including but not limited to, the impact
on our workforce, operations, fill rates, supply chain, demand for
our products and services, and our financial results and
condition;
- the potential for future reductions in demand for product
categories that benefited from the COVID-19 pandemic, including the
potential for reduced orders as retailers work through excess
inventory;
- adverse weather conditions;
- our inability to pass through cost increases in a timely
manner;
- the success of our Central to Home strategy;
- risks associated with our acquisition strategy, including our
ability to successfully integrate acquisitions and the impact of
purchase accounting on our financial results;
- fluctuations in energy prices, fuel and related petrochemical
costs;
- supply chain delays and disruptions resulting in lost sales,
reduced fill rates and service levels and delays in expanding
capacity and automating processes;
- seasonality and fluctuations in our operating results and cash
flow;
- supply shortages in pet birds, small animals and fish;
- dependence on a small number of customers for a significant
portion of our business;
- impacts of tariffs or a trade war;
- consolidation trends in the retail industry;
- declines in consumer spending during economic downturns;
- risks associated with new product introductions, including the
risk that our new products will not produce sufficient sales to
recoup our investment;
- competition in our industries;
- continuing implementation of an enterprise resource planning
information technology system;
- potential environmental liabilities;
- risk associated with international sourcing;
- access to and cost of additional capital;
- potential goodwill or intangible asset impairment;
- our dependence upon our key executives;
- our ability to recruit and retain new members of our management
team to support our growing businesses and to hire and retain
employees;
- our inability to protect our trademarks and other proprietary
rights;
- litigation and product liability claims;
- regulatory issues;
- the impact of product recalls;
- potential costs and risks associated with actual or potential
cyber attacks;
- potential dilution from issuance of authorized shares;
- the voting power associated with our Class B stock; and
- the impact of new accounting regulations and the possibility
our effective tax rate will increase as a result of future changes
in the corporate tax rate or other tax law changes.
These risks and others are described in the Company’s Securities
and Exchange Commission filings. The Company undertakes no
obligation to publicly update these forward-looking statements to
reflect new information, subsequent events or otherwise. The
Company has not filed its Form 10-Q for the fiscal quarter ended
June 25, 2022, so all financial results are preliminary and subject
to change.
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version on businesswire.com: https://www.businesswire.com/news/home/20220622005430/en/
Investor Relations Contact Friederike Edelmann VP,
Investor Relations (925) 412-6726 fedelmann@central.com
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