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Alberto Culver profit tops expectations; Q3 Profit Rises

By Amarendra Bhushan for CEOWORLD Magazine Updated:July 27, 2009

Alberto Culver Company, a leading manufacturer and marketer of personal care products including TRESemme, Alberto VO5, Nexxus, St. Ives and Noxzema today announced growth in organic revenue and diluted earnings per share from continuing operations, excluding restructuring and discrete items.

* Net sales for the third quarter decreased 3.6% to $351.6 million from $364.9 million in the prior year quarter. Reported net sales were reduced 7.9% by foreign currency fluctuations. Excluding the effect of foreign currency fluctuations and the acquisition of Noxzema, organic sales increased 2.0% in the third quarter.

* Pre-tax earnings from continuing operations, which includes restructuring and discrete expenses of $7.7 million in the current quarter and restructuring expense of $2.7 million and discrete income of $3.9 million in the prior year quarter, decreased 11.1% to $37.9 million from $42.7 million in the prior year quarter. Excluding restructuring and discrete items, pre-tax earnings from continuing operations increased 9.9% to $45.6 million compared to $41.5 million in the prior year quarter.

* Diluted earnings per share from continuing operations were 28 cents in the current quarter compared to 29 cents in the prior year quarter. Excluding restructuring and discrete items (see detail in bullets below), diluted earnings per share from continuing operations increased 11.1% to 30 cents compared to 27 cents in the prior year. The reported diluted earnings per share from continuing operations includes the following items:

- The current and prior year quarters include approximately 3 cents and 2 cents per share, respectively, of restructuring expense.

- The current year quarter includes approximately 2 cents per share of expenses related to a dispute with a supplier while the prior year quarter includes approximately 3 cents per share of benefit from the reversal of a contingent liability.

- The current and prior year quarters include approximately 3 cents and 1 cent per share, respectively, of discrete tax benefits, primarily due to changes in certain estimates related to the previous years’ tax returns and the favorable resolution of certain open tax items.

Nine Months:

* Net sales for the nine month period decreased 0.8% to $1.05 billion from $1.06 billion in the prior year. Reported net sales were reduced 9.1% by foreign currency fluctuations. Excluding the effect of foreign currency fluctuations and the acquisition of Noxzema, organic sales increased 5.8% in the nine month period.

* Pre-tax earnings from continuing operations, which includes restructuring and discrete items of $8.0 million in the current year and $5.7 million in the prior year, increased 12.6% to $141.1 million from $125.4 million in the prior year. Excluding restructuring and discrete items, pre-tax earnings from continuing operations increased 13.8% to $149.1 million compared to $131.1 million in the prior year.

* Diluted earnings per share from continuing operations were 87 cents compared to 85 cents in the prior year. Excluding restructuring and discrete items (see detail in bullets below), diluted earnings per share from continuing operations increased 13.8% to 99 cents compared to 87 cents in the prior year. The reported diluted earnings per share from continuing operations includes the following items:

- The current year and prior year include approximately 3 cents and 6 cents per share, respectively, of restructuring expense.

- The current year includes approximately 2 cents per share of expenses related to a dispute with a supplier while the prior year includes approximately 3 cents per share of benefit from the reversal of a contingent liability.

- The current year includes approximately 7 cents per share of discrete tax expense, primarily related to taxes on a local currency gain on U.S. dollar denominated cash held in Sweden following the Cederroth sale. The prior year includes approximately 1 cent per share of discrete tax benefit.

Author : Amarendra Bhushan

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