DIAL’S BATH UNIT SLIPS 34.6 PERCENT IN SALES
Byline: Andrea M. Grossman
SCOTTSDALE, Ariz. — The Dial Corp.’s specialty personal care division fell 34.6 percent in sales to $24.7 million in its third quarter, compared with $37.8 million in last year’s comparable period. The SPC division — which includes Freeman Cosmetics hair and bath products and Sarah Michaels specialty bath products — recorded a $40 million inventory charge, half of which went toward slashing Sarah Michaels’s and Freeman’s stockkeeping unit portfolio.
“We are moving to a smaller, more focused, more profitable product line. We have taken out more than 40 percent of the SPC sku’s,” said Herbert Baum, Dial’s chief executive officer, in a conference call on Tuesday.
The balance of the inventory charge went for discontinuing the company’s “unprofitable” Nature’s Accents line of bath products, as well as discontinuing the unit’s private-label bath business.
Selling SPC may be an option for Dial sometime in the future. Regarding a possible sale, Baum said Dial “has no sacred cows” and that the SPC unit “has had several interested parties, but [no one] specific at this time.” In the meantime, Baum plans to “continue to pare and shape the business for near-term profitability.”
Overall, Dial Corp. announced a third-quarter net income of $4.4 million, excluding special charges and a one-time gain, down from $30.8 million last year. Sales fell 6 percent to $411.1 million from $437 million a year ago, due in part to the company’s concerted effort to reduce end-of-quarter shipments and promotions.