Jarden Corporation reported sales declined 1.6 percent to $684.1 million at its Outdoor Solutions segment in the quarter ended March 31 and that earnings fell 22.3 percent to $55.3 million compared with $71.2 million in the same quarter of 2013.
Segment operating earnings, which reflect the effect of inventory valuation adjustments, exchange rates, depreciation and amortization, reached $36.3 million, down 35.4 percent from $56.2 million.
The segment owns more than 20 sporting goods brands including the winter sports brands Madshus, Marker, Marmot and Volkl.
Companywide results Jarden reported consolidated sales, which include results at two other operating segments focused on household products, reached $1.73 billion in the first quarter ended March 31, compared to $1.58 billion for the same period in 2013. Companywide, organic net sales grew 0.6 percent, or $8.7 million. Gross margins rose 160 basis points to 29.7 percent compared to the same period in 2013. Adjusted gross margin grew 200 basis poins to 30.4 percent compared to 28.4 percent for the same period in 2013; Net income increased to $3.7 million, compared to net loss of $4.4 million for the same period in 2013; resulting in earnings per share of 3 cents per diluted share, compared to a loss of 4 cents per diluted share for the same period in 2013. Adjusted net income was $25.1 million, compared to $33.1 million for the same period in 2013; and adjusted diluted earnings per share was $0.20 per diluted share, compared to $0.30 per diluted share for the same period in 2013.
"We began the year solidly, reporting record first quarter revenues, positive organic growth, and continued expansion in gross margins, giving us good momentum in our seasonally smallest quarter of the year. We believe that we are well positioned to achieve our annual guidance expectations," said Martin E. Franklin, Executive Chairman. "We grew organically driven by product innovation and category expansion.
Franklin noted the company made progress toward its capital management objectives with stock repurchase activity as well as a $690 million private offering of 1 percent Senior Subordinated Convertible Notes due 2034.
CEO James E. Lillie called it a positive start to the year that positions the company to deliver on its 2014 plan, which calls for organic growth in the 3-to-5 percent. "We are particularly pleased with our performance considering the number of customer store closings that occurred in the first quarter as a result of the extreme weather," said Lillie. "Jarden's diversification continued to serve us well, as the weather aided the continued sell through of many of our traditional winter products. We continue to expect that variance within our adjusted diluted earnings per share guidance in 2014, will largely be driven by currency fluctuations and not operational performance. The first quarter is by far our smallest quarter, as we look beyond the first quarter, I am encouraged by our team's focus and alignment on this year and on our recently detailed long-term goals."
All earnings per share and shares outstanding amounts have been adjusted to reflect the effect of the 3-for-2 split of the Company's outstanding shares of common stock that occurred during the first quarter of 2013.
Jarden Corporation Outdoor Solutions segment includes Abu Garcia, AeroBed, Berkley, Campingaz and Coleman, ExOfficio, Fenwick, Greys, Gulp!, Hardy, Invicta, K2, Madshus, Marker, Marmot, Mitchell, PENN, Rawlings, Ride, Sevylor, Shakespeare, Stearns, Stren, Trilene, Volkl, Worth and Zoot.
