Alberto-Culver Co. reported that third-quarter profits vaulted 68.8 percent to $47.2 million, or 47 cents a diluted share, from $28 million, or 28 cents a share, in the same period a year ago on an 18.8 percent increase in sales.
Excluding restructuring items related to the downsizing of the firm’s manufacturing plant in Chatsworth, Calif., and a discrete tax benefit, diluted earnings per share from continuing operations came in at 39 cents a share, 2 cents higher than expected by analysts polled by Yahoo Finance, versus 30 cents in the prior-year period.
Revenues during the quarter reached $417.6 million compared with $351.6 million last year, an increase attributed to double-digit organic sales growth of core beauty brands. Alberto-Culver’s portfolio includes TRESemmé, Alberto VO5, Nexxus, St. Ives, Simple and Noxzema.
“We [recorded] exceptionally strong growth in the third quarter,” V. James Marino, president and chief executive officer of the Melrose Park, Ill.-based firm, told analysts during a conference call Monday. “U.S. sales were strong,” he said, adding that due to the performance of “TRESemmé in every region, international sales” were up.
While international sales jumped 29 percent, U.S. sales grew 12.7 percent, behind “effective marketing and promotional activity,” the firm stated, adding, “replenishment of retailer inventory levels…were restored to levels that existed prior to the company’s supply chain, manufacturing and systems disruptions.”
“We are reestablishing momentum in our business,” Marino remarked.
“Despite challenging economic conditions and soft category growth rates, we continue to outperform the hair care category and gain market share,” the firm stated.
Selling and administrative expenses decreased to 19.4 percent of sales in the quarter compared with 22.6 percent a year ago. Meanwhile, quarterly advertising and other marketing investments increased 20.2 percent to $67.7 million compared with $56.3 million last year, primarily due to double-digit increases on TRESemmé and St. Ives and the December acquisition of the Simple skin care brand.
When asked by an analyst during the call if there was potential to expand Simple from its U.K. home into other markets, Marino responded, “If it maintains growth levels in the U.K. and above average margins…time will tell how it travels in other markets.”
Year-to-date profits surged 29.9 percent to $114 million, or $1.14 a share, from $87.7 million, or 89 cents, on an 11.1 percent increase in sales to $1.17 billion from $1.05 billion in the previous nine-month period.
Shares of Alberto-Culver closed up $1.53, or 5.2 percent, to close at $30.93.
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