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Sep 30, 2022
Scotts Q4 2022 Earnings Report
ScottsMiracle-Gro's Q4 2022 sales and earnings aligned with expectations, with Project Springboard achieving $100 million in annualized cost savings and a new phase targeting an additional $85 million in savings was launched.
Key Takeaways
ScottsMiracle-Gro announced Q4 2022 results with sales declining by 33 percent, driven by decreases in both major business segments. The company reported a GAAP loss of $3.97 per share and a non-GAAP adjusted loss of $2.04 per share. Project Springboard achieved $100 million in annualized cost savings, and Project Springboard 2.0 was launched to target an additional $85 million in cost reductions.
Consolidated sales and earnings results were consistent with expectations despite a challenging finish to fiscal 2022.
The company remained within its leverage covenants and established a path to return to acceptable profitability levels.
Prioritizing more profitable product mixes and front-loading marketing and promotional activities to drive early consumer traffic.
Decisive actions are being taken across the organization to manage leverage and create stronger conditions for long-term success.
Scotts
Scotts
Scotts Revenue by Segment
Revenue by Segment
U.S. Consumer Segment Revenue
CapyFin.comHawthorne Segment Revenue
CapyFin.comOther Segment Revenue
CapyFin.com Forward Guidance
The Company provided direction for fiscal 2023 that includes low single-digit percentage growth in adjusted operating income versus fiscal 2022, mid-single digit percentage growth in adjusted EBITDA versus fiscal 2022, interest expense increase of $35 million to $40 million, effective tax rate of 25 percent to 26 percent, and free cash flow of $1 billion over the next two years.
Positive Outlook
- Low single-digit percentage growth in adjusted operating income versus fiscal 2022
- Mid-single digit percentage growth in adjusted EBITDA versus fiscal 2022
- Free cash flow of $1 billion over the next two years
Challenges Ahead
- Interest expense increase of $35 million to $40 million
- Effective tax rate of 25 percent to 26 percent
Revenue & Expenses
Visualization of income flow from segment revenue to net income