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Dec 29, 2024
Spectrum Brands Q1 2025 Earnings Report
Reported a mixed first quarter of fiscal 2025, marked by increased net sales and net income, alongside a decrease in adjusted EBITDA.
Key Takeaways
Spectrum Brands Holdings reported a 1.2% increase in net sales and a 1.9% increase in organic sales, driven by an extended fall season and accelerated pre-season sales for Home & Garden. Net income from continuing operations increased to $24.6 million, while adjusted EBITDA decreased to $77.8 million. The company maintains its fiscal 2025 earnings framework, expecting low single-digit net sales growth and mid to high single-digit adjusted EBITDA growth.
Net sales increased by 1.2% and organic sales increased by 1.9%, driven by the extended fall season and accelerated pre-season sales for Home & Garden.
Net income from continuing operations was $24.6 million, while adjusted EBITDA was $77.8 million.
Adjusted EBITDA increased $16.5 million excluding investment income in the prior year.
The company repurchased 0.8 million shares in Q1 for $72.9 million.
Spectrum Brands
Spectrum Brands
Forward Guidance
Spectrum Brands continues to expect low single-digit growth in reported net sales in fiscal 2025. Fiscal 2025 adjusted EBITDA is expected to increase by mid to high single-digits. Adjusted free cash flow is expected to be approximately 50% of adjusted EBITDA.
Positive Outlook
- Expects low single-digit growth in reported net sales in fiscal 2025.
- Fiscal 2025 adjusted EBITDA is expected to increase by mid to high single-digits.
- Adjusted free cash flow is expected to be approximately 50% of adjusted EBITDA.
- Targeting a long-term net leverage ratio of 2.0 - 2.5 times.
- Brand-focused investments are expected to drive innovation and consumer demand.
Challenges Ahead
- Impact of the Russia-Ukraine war and the Israel-Hamas war.
- Increased reliance on third-party partners, suppliers and distributors that are outside our control.
- Impact of government intervention with or influence on the operations of our suppliers, including in China.
- The impact of expenses resulting from the implementation of new business strategies, divestitures or current and proposed restructuring and optimization activities
- General economic conditions, including the impact of, uncertainty around and changes to, tariffs and trade policies, including the tariffs announced by the Trump Administration in February 2025, inflation, recession or fears of a recession, depression or fears of a depression, labor costs and stock market volatility or monetary or fiscal policies in the countries where we do business.