Scotts Miracle-Gro(US:SMG) ZACKSยท2024-08-01 12:10Core Viewpoint - Scotts Miracle-Gro Company (SMG) reported significant profit growth in Q3 fiscal 2024, with adjusted earnings surpassing expectations despite a slight miss in net sales [1][2]. Financial Performance - The company reported a profit of $132.1 million or $2.28 per share, compared to $43.7 million or 77 cents per share in the same quarter last year [1]. - Adjusted earnings were $2.31 per share, up from $1.17 a year ago, exceeding the Zacks Consensus Estimate of $1.89 [1]. - Net sales increased by approximately 7.5% year over year to $1,202.2 million, but fell short of the consensus mark of $1,203.6 million [1]. Segment Details - U.S. Consumer division net sales rose 11% year over year to $1,017.5 million, although it was below the estimate of $1,083.2 million; the segment's profit increased by 69% to $210.3 million [2]. - The Hawthorne segment experienced a 28% decline in net sales to $67.7 million, significantly lower than the estimate of $94.7 million; however, profit rose 144% to $3.8 million [2]. - The other segment saw a 7% increase in net sales to $117 million, with profit up 102% to $11.7 million [3]. Balance Sheet - At the end of the quarter, cash and cash equivalents stood at $279.9 million, a substantial increase from $27.4 million a year ago [4]. - Long-term debt decreased by approximately 7.3% to $2,436.4 million [4]. Outlook - The company reiterated its adjusted fiscal 2024 guidance, except for the Hawthorne segment, which is now expected to see net sales 35-40% lower than the previous year due to strategic exits from lower-margin brands and a decline in the professional horticulture lighting business [5]. - The Hawthorne segment anticipates break-even or improved adjusted EBITDA for the full year [5]. Price Performance - Scotts Miracle-Gro shares have increased by 35.9% over the past year, contrasting with a 25.2% decline in the industry [7].