WD-40 pany(US:WDFC)2026-01-08 21:12Financial Performance - Consolidated net sales increased by $0.9 million, or 1%, to $154.4 million compared to the same period last year, with a $4.2 million unfavorable impact from sales volume decreases [99]. - Consolidated net income decreased by $1.5 million, or 8%, with diluted earnings per share at $1.28 compared to $1.39 in the prior year [99]. - On a constant currency basis, net sales would have decreased by $2.4 million, or 2%, from the prior year [99]. - Net income decreased 8% to $17.5 million, or $1.28 per share, with a constant currency basis showing an 11% decrease [134]. - Adjusted EBITDA as a percentage of net sales decreased from 18% to 17% [140]. Segment Performance - Net sales in the Americas segment increased by $2.4 million, or 4%, driven by a $1.7 million increase in WD-40 Multi-Use Product sales [101]. - WD-40 Specialist sales grew by $3.4 million, or 18%, primarily due to increased online retail sales and new distribution [100]. - Homecare and cleaning product sales decreased by $2.5 million, or 31%, primarily due to the sale of the HCCP business in EIMEA [100]. - The EIMEA segment accounted for 38% of consolidated sales, with a favorable impact of $3.4 million from foreign currency exchange rates [99]. - EIMEA segment net sales increased by $1,192, or 2%, to $58,675, with WD-40 Specialist sales rising by 27% to $9,933 [106]. - In the Asia-Pacific segment, total net sales decreased by $2,701, or 10%, to $23,875, primarily due to a 12% decline in WD-40 Multi-Use Product sales [112]. Profitability and Expenses - Gross profit as a percentage of net sales rose to 56.2% from 54.8% in the prior year [99]. - Gross profit for the three months ended November 30, 2025, increased by $2,745 to $86,832, with gross margin improving by 140 basis points to 56.2% [117]. - Selling, General and Administrative (SG&A) expenses rose by $4,811, or 10%, to $55,336, representing 35.8% of net sales [120]. - Income from operations in the Americas segment increased by $2,387, or 19%, to $15,039, while EIMEA segment income decreased by $1,207, or 9% [127]. - Americas operating income increased to $15.0 million, up $2.4 million, or 19%, with gross margin rising from 50.4% to 53.3% [128]. - EIMEA operating income decreased to $12.5 million, down $1.2 million, or 9%, with gross margin increasing from 57.8% to 58.7% [129]. - Asia-Pacific operating income decreased to $8.0 million, down $2.2 million, or 22%, with gross margin decreasing from 59.6% to 58.9% [130]. - Total operating expenses increased to $63.6 million, with cost of doing business as a percentage of net sales rising to 40% [139]. Cash Flow and Shareholder Returns - Approximately $20.6 million was returned to stockholders through share repurchases and dividends during the quarter [99]. - The company had $48.6 million in cash and cash equivalents as of November 30, 2025, indicating strong liquidity [144]. - The Board approved an extension of the share repurchase plan, allowing for up to $50.0 million in buybacks, with $21.8 million remaining available [146]. - Net cash used in financing activities increased by $14.6 million to $18.7 million for the three months ended November 30, 2025, primarily due to net proceeds of $4.5 million on the revolving credit facility [152]. - A cash dividend of $1.02 per share was declared on December 10, 2025, payable on January 30, 2026, to stockholders of record at the close of business on January 16, 2026 [156]. Other Information - Research and development costs remained stable at $1.9 million for both the three months ended November 30, 2025, and 2024, focusing on sustainability and product innovation [122]. - Advertising and Sales Promotion (A&P) expenses decreased by $204, or 2%, to $8,189, with total promotional costs recorded as a reduction to sales at $9.0 million [123][125]. - The company experienced a currency impact of $3.2 million favorably affecting net sales in the Asia-Pacific segment [113]. - The decrease in sales volume in the EIMEA segment was attributed to the sale of the homecare and cleaning product businesses, which will not be included in fiscal year 2026 results [108]. - The company reported a decrease in average selling price by $0.2 million and a decrease in sales volume due to the sale of HCCP by $1.6 million in the EIMEA segment [107]. - Unallocated corporate expenses increased to $12.2 million, up $0.8 million, or 7%, primarily due to higher employee-related costs [131]. - There have been no material changes in critical accounting estimates from those disclosed in the previous fiscal year [159]. - Information on recently issued accounting standards that could impact consolidated financial statements is referenced in the report [160].