The Scotts Miracle-Gro Company reported third quarter net sales of $1.17 billion, a 1% increase, and raised its full-year non-GAAP adjusted EPS guidance to a range of $4.30 to $4.45 per share, up from the prior range of $4.15 to $4.35. Branded product sales grew 4.5% year to date, reflecting a strategic shift toward higher-margin brands and away from lower-margin commodity items, while e-commerce point-of-sale dollars rose 27% and now account for 13% of total company POS dollars. The company exited approximately $100 million in low-margin commodity mulch and soil sales during the year and is targeting a 30% reduction in its lowest-performing stock-keeping units by the end of fiscal 2027. Net leverage improved to 3.78x from 4.15x a year ago, and free cash flow guidance of $275 million was reaffirmed, with the intent to drive the leverage ratio toward the high 3s. Management noted that entering the fourth quarter, retailer inventories were slightly elevated over the prior year by high-single-digit percentages, which is expected to lead to a slowdown in purchasing activity and push full-year U.S. Consumer sales growth toward the lower end of the low-single-digit guidance range.
Scotts Miracle-Gro CompanyRaises full-year EPS guidance and improves leverage, indicating stronger profitability and financial health.
