MARYSVILLE, Ohio, Feb. 05, 2024 (GLOBE NEWSWIRE) -- The Scotts Miracle-Gro Foundation and the Alliance for Water Efficiency (AWE) have announced an extension of their partnership that will support research to improve the efficiency of lawns and other landscapes. The grant helps to fund environmental programs through December 2025.  "We are honored to receive this funding from The Scotts Miracle-Gro Foundation, which continues our long-standing partnership to research how to design, grow, and irrigate lawns ...

MARYSVILLE, Ohio, Jan. 30, 2024 (GLOBE NEWSWIRE) -- The Scotts Miracle-Gro Company (NYSE:SMG), the world's leading marketer of branded consumer lawn and garden as well as indoor and hydroponic growing products, today announced that Nancy Mistretta has retired from its Board of Directors. Mistretta has been a director since 2007 and served on various Board committees, most recently as a member of the Audit Committee and the Compensation and Organization Committee. "Nancy has been a great partner and friend o ...

MARYSVILLE, Ohio, Jan. 29, 2024 (GLOBE NEWSWIRE) -- The Scotts Miracle-Gro Company (NYSE:SMG), the world's leading marketer of branded consumer lawn and garden as well as indoor and hydroponic growing products, will release its first quarter financial results on Wednesday, February 7, 2024, prior to the opening of the U.S. financial markets. The Company will host a video presentation via webcast at 9:00 a.m. EST to discuss those results. The webcast will be followed by an audio question-and-answer session. ...

MARYSVILLE, Ohio, Jan. 22, 2024 (GLOBE NEWSWIRE) -- The Scotts Miracle-Gro Company (NYSE:SMG), the world's leading marketer of branded consumer lawn and garden as well as indoor and hydroponic growing products, announced that its Board of Directors has approved the payment of a cash dividend of $0.66 per share. The dividend is payable on Friday, March 8, 2024, to shareholders of record as of Friday, February 23, 2024. About ScottsMiracle-GroWith approximately $3.6 billion in sales, the Company is the world' ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 _____________________________________ Form 10-K _____________________________________ (Mark One) ☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended September 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-11593 ________________________________ ...

The Scotts Miracle-Gro Company (NYSE:SMG) Q4 2023 Earnings Conference Call November 1, 2023 9:00 AM ET Company Participants Aimee DeLuca - Senior Vice President of Investor Relations James Hagedorn - Chairman, President, and CEO Matthew Garth - Chief Financial and Administrative Officer Nate Baxter - Chief Operating Officer Chris Hagedorn - Group President of Hawthorne Conference Call Participants John Andersen - William Blair & Co. Bill Chappell - Truist Securities Joseph Altobello - Raymond James & Associ ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 _________________________________________ FORM 10-Q _________________________________ (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended July 1, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-11593 ____________________________________ The Scotts ...

The Scotts Miracle-Gro Company (NYSE:SMG) Q3 2023 Earnings Conference Call August 2, 2023 9:00 AM ET Company Participants Aimee DeLuca - Senior Vice President of Investor Relations James Hagedorn - Chairman and Chief Executive Officer Matthew Garth - Executive Vice President and Chief Financial Officer Michael Lukemire - President and Chief Operating Officer Chris Hagedorn - Division President of Hawthorne Patti Ziegler - Vice President of Global Marketing and Communications Conference Call Participants Jos ...

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section presents the company's unaudited financial statements, MD&A, market risk, and internal controls [Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20%28Unaudited%29) This section presents the unaudited condensed consolidated financial statements, highlighting significant decreases in net income and total equity Condensed Consolidated Statements of Operations Highlights | Metric | Three Months Ended April 1, 2023 | Three Months Ended April 2, 2022 | Six Months Ended April 1, 2023 | Six Months Ended April 2, 2022 | | :--- | :--- | :--- | :--- | :--- | | Net sales | $1,531.5 M | $1,678.4 M | $2,058.1 M | $2,244.3 M | | Gross margin | $412.7 M | $588.4 M | $508.4 M | $707.0 M | | Income from operations | $206.2 M | $387.9 M | $164.4 M | $352.5 M | | Net income | $109.4 M | $276.5 M | $44.7 M | $226.4 M | | Diluted net income per common share | $1.94 | $4.94 | $0.80 | $4.02 | Condensed Consolidated Balance Sheets Highlights | Metric | April 1, 2023 | April 2, 2022 | September 30, 2022 | | :--- | :--- | :--- | :--- | | Total current assets | $2,842.4 M | $3,254.4 M | $1,981.9 M | | Total assets | $4,988.1 M | $6,207.5 M | $4,296.8 M | | Total current liabilities | $1,372.5 M | $1,470.3 M | $963.9 M | | Total liabilities | $4,850.6 M | $5,232.5 M | $4,149.1 M | | Total equity | $137.5 M | $975.0 M | $147.7 M | Condensed Consolidated Statements of Cash Flows Highlights (Six Months Ended) | Metric | April 1, 2023 | April 2, 2022 | | :--- | :--- | :--- | | Net cash used in operating activities | $(566.9) M | $(1,142.6) M | | Net cash used in investing activities | $(20.6) M | $(255.8) M | | Net cash provided by financing activities | $525.3 M | $1,171.3 M | | Cash and cash equivalents at end of period | $25.0 M | $17.1 M | [Note 4: Impairment, Restructuring and Other](index=9&type=section&id=NOTE%204.%20IMPAIRMENT%2C%20RESTRUCTURING%20AND%20OTHER) Significant restructuring charges of **$140.5 million** and **$159.2 million** were incurred for Hawthorne supply chain optimization Impairment, Restructuring and Other Charges (in millions) | Charge Type | Three Months Ended April 1, 2023 | Six Months Ended April 1, 2023 | | :--- | :--- | :--- | | Cost of sales—impairment, restructuring and other | $118.7 | $129.0 | | Operating expenses—impairment, restructuring and other | $21.8 | $30.2 | | **Total** | **$140.5** | **$159.2** | - The company accelerated the optimization of its Hawthorne supply chain, announcing the closure of four additional distribution centers and selling its non-core Hurricane branded fans business for **$5.0 million**[34](index=34&type=chunk) - Total costs incurred from the inception of this restructuring initiative through April 1, 2023, were **$180.3 million** for the Hawthorne segment and **$23.1 million** for the U.S. Consumer segment[34](index=34&type=chunk) [Note 7: Debt](index=11&type=section&id=NOTE%207.%20DEBT) Total debt was **$3.59 billion** as of April 1, 2023, with a leverage ratio of **6.01**, compliant with amended covenants Debt Components (in millions) | Component | April 1, 2023 | April 2, 2022 | | :--- | :--- | :--- | | Revolving loans | $642.5 | $1,135.0 | | Term loans | $950.0 | $650.0 | | Senior Notes (aggregate) | $1,600.0 | $1,600.0 | | Receivables facility | $380.0 | $400.0 | | **Total debt** | **$3,593.5** | **$3,829.1** | - The company's leverage ratio was **6.01** at April 1, 2023, compliant with the amended maximum permitted ratio of **6.50** for Q2 and Q3 of fiscal 2023[45](index=45&type=chunk) - The company has contingency plans, including further restructuring and potential financing transactions, to address potential future noncompliance with debt covenants[47](index=47&type=chunk) [Note 15: Segment Information](index=23&type=section&id=NOTE%2015.%20SEGMENT%20INFORMATION) Hawthorne segment sales dramatically declined by **43%** to **$224.2 million**, resulting in a significant loss, while U.S. Consumer sales remained flat Net Sales by Segment (Six Months Ended, in millions) | Segment | April 1, 2023 | April 2, 2022 | % Change | | :--- | :--- | :--- | :--- | | U.S. Consumer | $1,726.3 | $1,722.2 | +0.2% | | Hawthorne | $224.2 | $393.2 | -43.0% | | Other | $107.6 | $128.9 | -16.5% | | **Consolidated** | **$2,058.1** | **$2,244.3** | **-8.3%** | Segment Profit (Loss) (Six Months Ended, in millions) | Segment | April 1, 2023 | April 2, 2022 | | :--- | :--- | :--- | | U.S. Consumer | $428.7 | $439.6 | | Hawthorne | $(33.0) | $(2.0) | | Other | $16.0 | $11.8 | | **Total Segment Profit** | **$411.7** | **$449.4** | [Management's Discussion and Analysis (MD&A)](index=25&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Q2 net sales declined **8.8%** due to the Hawthorne segment's **54.2%** collapse, prompting a restructuring plan targeting over **$200 million** in annualized savings [Executive Summary](index=25&type=section&id=Executive%20Summary) Performance was impacted by the Hawthorne segment downturn and cost inflation, leading to a restructuring targeting at least **$200 million** in annualized savings - Hawthorne segment sales volume decreased significantly due to continued challenges in the hydroponic industry from an oversupply of cannabis, which has depressed prices and cultivation[100](index=100&type=chunk) - The company is implementing a restructuring initiative and now expects to deliver run-rate annualized savings of at least **$200.0 million**, up from the original **$185.0 million** goal[100](index=100&type=chunk) - The company continued to experience cost inflation in manufacturing and logistics, as well as volatile commodity costs, which necessitated material price increases in fiscal 2022 and 2023[101](index=101&type=chunk) [Results of Operations](index=27&type=section&id=Results%20of%20Operations) Q2 fiscal 2023 net sales decreased **8.8%** to **$1.53 billion**, with gross margin falling to **26.9%** due to **$140.5 million** in charges Drivers of Net Sales Change (Q2 FY2023 vs Q2 FY2022) | Factor | Percentage Change | | :--- | :--- | | Volume and mix | (16.4)% | | Pricing | 8.0% | | Foreign exchange rates | (0.4)% | | **Total Change in Net Sales** | **(8.8)%** | - The gross margin rate decreased by **8.2 percentage points**, from **35.1%** to **26.9%**, primarily due to a **7.5 percentage point** negative impact from impairment and restructuring charges[107](index=107&type=chunk) - Interest expense increased **70.7%** in the quarter to **$48.3 million**, driven by higher average borrowings and a **210 basis point** increase in the weighted average interest rate[117](index=117&type=chunk) [Segment Results](index=32&type=section&id=Segment%20Results) Hawthorne segment Q2 net sales plummeted **54.2%** to **$92.7 million**, resulting in a **$16.8 million** loss, while U.S. Consumer sales slightly declined - U.S. Consumer Q2 net sales decreased **1.6%** to **$1,357.4 million**, as a **10.4%** volume decline was mostly offset by an **8.7%** price increase[129](index=129&type=chunk) - Hawthorne Q2 net sales plummeted **54.2%** to **$92.7 million**, driven by a **59.9%** volume decline. The segment reported a loss of **$16.8 million**[131](index=131&type=chunk)[132](index=132&type=chunk) - Other segment Q2 net sales decreased **15.2%**, but Segment Profit increased **39.0%** to **$14.6 million** due to cost management[133](index=133&type=chunk)[134](index=134&type=chunk) [Liquidity and Capital Resources](index=34&type=section&id=Liquidity%20and%20Capital%20Resources) Cash used in operations improved to **$566.9 million** for the first six months of FY2023, with debt covenants maintained at a leverage ratio of **6.01** - Net cash used in operating activities for the six months ended April 1, 2023, was **$566.9 million**, a significant improvement from the **$1,142.6 million** used in the same period last year[136](index=136&type=chunk)[137](index=137&type=chunk) - The company's leverage ratio was **6.01** at April 1, 2023, compliant with the amended covenant maximum of **6.50** for Q2 2023. The company expects to remain in compliance for the next twelve months[147](index=147&type=chunk)[148](index=148&type=chunk) - The company's share repurchase authorization expired on March 25, 2023, with no repurchases made under it during fiscal 2023[140](index=140&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=39&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) Market risks have not materially changed from those disclosed in the 2022 Annual Report - Market risks have not materially changed from those disclosed in the 2022 Annual Report[173](index=173&type=chunk) [Controls and Procedures](index=39&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of April 1, 2023, with no material changes to internal control over financial reporting - The principal executive officer and principal financial officer have concluded that the Registrant's disclosure controls and procedures were effective as of April 1, 2023[175](index=175&type=chunk) - There were no changes in the Registrant's internal control over financial reporting during the fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Registrant's internal control over financial reporting[176](index=176&type=chunk) [PART II. OTHER INFORMATION](index=40&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, equity sales, debt defaults, mine safety disclosures, other information, and exhibits [Legal Proceedings](index=40&type=section&id=Item%201.%20Legal%20Proceedings) No material developments in legal proceedings were reported, and ongoing lawsuits are not expected to have a material adverse effect - There have been no material developments to the pending legal proceedings previously disclosed in the 2022 Annual Report[177](index=177&type=chunk) [Risk Factors](index=40&type=section&id=Item%201A.%20Risk%20Factors) The company's risk factors have not materially changed from those described in its 2022 Annual Report on Form 10-K - The Company's risk factors, as of April 1, 2023, have not materially changed from those described in Part I, Item 1A of the 2022 Annual Report[179](index=179&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=41&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The **$750 million** share repurchase program expired on March 25, 2023, with no repurchases, and dividends are limited to **$225.0 million** annually by the credit agreement - The share repurchase program announced on February 6, 2020, for up to **$750.0 million** expired on March 25, 2023. The company does not have an active repurchase program[189](index=189&type=chunk) - The amended credit agreement limits regularly scheduled cash dividends to an aggregate amount not to exceed **$225.0 million** per fiscal year[184](index=184&type=chunk) [Defaults Upon Senior Securities](index=41&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reports no defaults upon senior securities - None[186](index=186&type=chunk) [Mine Safety Disclosures](index=41&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable - Not Applicable[187](index=187&type=chunk) [Other Information](index=41&type=section&id=Item%205.%20Other%20Information) This item is not applicable - Not Applicable[188](index=188&type=chunk) [Exhibits](index=41&type=section&id=Item%206.%20Exhibits) This section provides an index of the exhibits filed with the report, including certifications and XBRL data files - Lists exhibits filed with the Form 10-Q, including certifications by the CEO and CFO, and XBRL data[191](index=191&type=chunk)

Financial Data and Key Metrics Changes - The company reported a significant improvement in free cash flow, increasing nearly $600 million through the first half of fiscal 2023, with a guidance reaffirmation of generating $1 billion in free cash flow through fiscal 2024 [41][42] - The adjusted gross margin rate declined by 70 basis points for both the quarter and first half, resulting in rates of 34.7% and 31% respectively [35] - SG&A expenses decreased by $44 million due to cost reduction efforts, with SG&A as a percentage of sales down from 16% in the first half of last year to 15.3% this year [43][68] Business Line Data and Key Metrics Changes - The US Consumer business reported second-quarter sales of $1.36 billion, just 2% shy of the prior year record, with first half sales totaling nearly $1.73 billion [91] - Hawthorne's second-quarter and first-half sales were $93 million and $224 million, down 54% and 43% respectively, primarily due to declines in North America lighting and growing environment [93] - The company expects to maintain SG&A savings moving forward, yielding SG&A between 15% and 16% of net sales for the full year [97] Market Data and Key Metrics Changes - The company observed significant point-of-sale (POS) lifts, with branded fertilizers up nearly 40% in Texas and 17% in Florida during Q2 [18] - POS units were essentially flat, with dollars up mid-single digits at the largest retailers [92] - The company noted that while the overall volume in the lawn category was down mid-to-high single digits through April, higher margin branded fertilizers were performing positively [64] Company Strategy and Development Direction - The company is focused on returning Hawthorne to run-rate profitability by the end of the year, with a strategy to align with the realities of the cannabis market [34][55] - The company plans to continue investing in innovation, marketing, and growth initiatives, including strategic investments in Hawthorne [16] - The company aims to achieve financial targets including reducing leverage to 3.5x or less and improving total company gross margin to 30% or more [45] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the consumer's engagement in lawn and garden, noting that consumers are responding positively to promotions that provide value [62] - The company anticipates favorable weather conditions that could extend the peak lawn and garden season deeper into the summer [20] - Management acknowledged the challenges in the cannabis sector but highlighted opportunities for those who adapt and innovate [24][55] Other Important Information - The company has made significant progress in reducing inventory, with inventory levels $467 million lower than the same time last year [99] - The company sold its Hurricane branded fans business, which is expected to accelerate distribution cost savings [66] - The company is actively advocating for regulatory changes to stabilize the cannabis industry [60] Q&A Session Summary Question: Why was guidance lowered despite strong POS and US Consumer performance? - Management indicated that the primary negative impact was from Hawthorne, which is top-line driven, but overall consumer performance is strong [79][80] Question: Are retail inventories reasonable at this point in the year? - Management stated that retail inventories are reasonable and that the volume decline is more related to a significant amount of units coming in at the right time [109] Question: What are the expectations for US Consumer volume for the year? - Management expects flat to positive growth in the US Consumer business, with more clarity expected by July [116] Question: What is the outlook for gross margins in fiscal 2024? - Management indicated that they are working towards achieving gross margins of 30% or more, with expectations for improvement towards the end of 2024 [120]