Retailers, consumers and prices
Check out the latest batch of quarterly earnings to parse in the consumer world.
Fortune Brands and Newell Rubbermaid both posted a stronger-than-expected quarterly profit and raised their full-year forecasts despite talk of “headwinds” in the second half of the year by the former and a “lackluster economy” by the latter.
Consumer goods maker Fortune Brands said its results were helped by double-digit sales growth for its home and security products. The maker of Jim Beam bourbon, Titleist golf balls and Moen faucets cited headwinds for the rest of the year higher but still raised its profit outlook.
“We anticipate the back half of the year will be impacted by certain headwinds we’ve previously discussed, including higher costs for raw materials and transportation, the stronger U.S. dollar, annualizing cost savings and increasingly challenging comparisons to last year’s improving results,” Chief Executive Bruce Carbonari said in a statement.
“However, even with these headwinds, we continue to believe that the markets for each of our three brand groups will grow at a low-single-digit rate for the year,” he added.
Venezuela President Hugo Chavez has rained on the U.S. consumer goods parade.
His government’s decision this month to devalue the Venezuela bolivar promises to hurt the profits of many leading U.S. consumer products makers this year even as they seem to be turning a corner.
On Friday, Newell Rubbermaid said the devaluation – which basically creates a two-tiered system that sells U.S. dollars for 4.3 bolivars in one market, and a separate parallel market where the greenback is going for about 6 bolivars- would shave 4-5 cents per share off of its 2010 earnings, sending its shares down.
That could be important since Newell on Tuesday said it was cutting its quarterly dividend to 5 cents a share from 10.5 cents. In January, it cut its dividend in half to get to that 10.5 cents.