Newell's Q4 Earnings Surpass Estimates, Lower Core Sales Hurt

Core Insights - Newell Brands Inc. (NWL) reported mixed fourth-quarter 2024 results, with earnings surpassing estimates but sales falling short, both metrics declining year over year [1][2] Financial Performance - Normalized earnings per share (EPS) were 16 cents, down 11.1% from 18 cents in the prior year, exceeding the consensus estimate of 14 cents [1] - Net sales decreased by 6.1% year over year to $1,949 million, missing the consensus estimate of$1,973 million, with core sales down 3% [2] - The normalized gross margin improved by 330 basis points year over year to 34.6%, marking the sixth consecutive quarter of year-over-year improvement [4] - The normalized operating margin increased by 70 basis points year over year to 7.1% [4] Segment Performance - Home & Commercial Solutions segment net sales were $1.2 billion, down 7.7$628 million, down 1.1% year over year, but core sales grew by 0.4% [6] - Outdoor and Recreation segment net sales were $152 million, a decline of 7.9$75 million under the realignment plan, with restructuring costs of $52 million [10] Financial Position - At the end of the quarter, NWL had cash and cash equivalents of$198 million, long-term debt of $4.5 billion, and shareholders' equity of$2.8 billion [12] - The company generated $496 million in cash from operating activities during 2024 and refinanced$1.25 billion of debt [12] Outlook - For 2025, management anticipates sales to decline by 2-4% year over year, with core sales expected to decrease by 2% to increase by 1% [13] - The normalized operating margin is projected to be between 9-9.5%, and normalized EPS is expected to be in the range of 70-76 cents [13] - For the first quarter, net sales are expected to drop by 5-8%, with core sales anticipated to decline by 2-4% [14]