Newell Brands(US:NWL)2023-02-24 22:00Financial Data and Key Metrics Changes - Newell Brands reported a core sales growth of 12.5% in 2021, followed by a decline of 3.5% in 2022, with a significant drop of 10.1% in the second half of 2022 [6][44] - The company expects core sales to decline by 6% to 8% in 2023, with more pronounced declines in the first half of the year [45] - Operating cash flow decreased in 2022 due to working capital adjustments, but the company anticipates a return to strong cash generation in 2023 [46][47] Business Line Data and Key Metrics Changes - The largest segment, Home and Commercial Solutions, accounts for over half of Newell's sales, while Learning and Development is the most profitable despite being less than one-third of sales [5] - E-commerce sales represent 22% of global sales, showcasing a competitive advantage for Newell [7] - The company has reduced its SKU count from 102,000 in 2018 to 28,000, a 73% reduction, which has improved revenue per SKU significantly [8][50] Market Data and Key Metrics Changes - Approximately one-third of Newell's business is international, with EMEA being the largest market at about $1.5 billion [5] - The top 10 countries account for 90% of sales, with significant markets including the U.K., Canada, France, Japan, Mexico, and Brazil [4] Company Strategy and Development Direction - Newell aims to become a consumer-led innovation powerhouse, focusing on enhancing consumer value and simplifying operations [5][52] - The company has implemented Project Phoenix to streamline operations and reduce complexity, consolidating 23 supply chains into one [9][39] - Newell is focusing on operational excellence, automation, and building strategic relationships with suppliers to enhance its supply chain [28][29] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the current constrained consumer demand for discretionary products due to inflation and expects to emerge stronger as macroeconomic conditions improve [4][52] - The leadership transition is seen as a positive step, with confidence in the new CEO's ability to drive the company forward [53][54] Other Important Information - Newell has made significant progress in employee engagement, with scores improving from 45 to 75 over recent years [10] - The company has launched annual consumer and customer marketing campaigns to enhance brand visibility and engagement [8] Q&A Session All Questions and Answers Question: How does the P&G experience help Newell in the current environment? - The new leadership team believes that while they will not turn Newell into P&G, their experience provides valuable insights into best-in-class capabilities and operational strategies [56] Question: What is the scope of the portfolio review? - The review will focus on evaluating tuck-in and tuck-out divestitures, with no expectation for significant major acquisitions or divestitures, as there are ample organic growth opportunities [63]