Consumer Products Segment
Presented below is a table that summarizes the results of operations of our Consumer Products segment and compares the amount of the change between the periods (in millions):
|
| | | | | | | | | | | | |
| | Fiscal Quarter |
| | 2016 | | 2015 | | Increase / (Decrease) |
Net consumer and other product sales | | $ | 1,218.8 |
| | $ | 1,067.8 |
| | $ | 151.0 |
|
Cost of consumer products and other goods sold | | 778.1 |
| | 697.6 |
| | 80.5 |
|
Consumer products segment gross profit | | 440.7 |
| | 370.2 |
| | 70.5 |
|
Selling, acquisition, operating and general expenses | | 274.6 |
| | 234.1 |
| | 40.5 |
|
Amortization of intangibles | | 23.6 |
| | 20.5 |
| | 3.1 |
|
Operating income - Consumer Products segment | | $ | 142.5 |
| | $ | 115.6 |
| | $ | 26.9 |
|
Revenues. Net consumer products sales for the Fiscal 2016 Quarter increased $151.0 million, or 14.1%, to $1,218.8 million from $1,067.8 million for the Fiscal 2015 Quarter. The increase in net consumer product sales in the Fiscal 2016 Quarter was primarily due to the impact of the acquisitions of AAG, European IAMS and Eukanuba and Salix that accounted for $144.9 million, as well as growth in sales in the global pet supplies, consumer batteries, home and garden control products, personal care products, and hardware and home improvement products lines. These increases were partially offset by the negative impact of foreign exchange of $61.4 million and a decrease in small appliances sales.
Global pet supplies sales grew by $15.5 million on a constant currency basis driven by increases in companion animal and aquatic sales in addition to a $71.2 million increase in sales due to the acquisitions of European IAMS and Eukanuba and Salix. The improvement in consumer batteries revenues was primarily driven by a $35.9 million increase in alkaline batteries sales across North America and Europe. Hardware and home improvement products sales grew by $16.2 million mainly as a result of increase in sales for security and plumbing products in domestic sales from new product initiatives and increased sales volumes with retail and non-retail customers, which was partially offset by a reduction in sales for the planned exit of unprofitable businesses and expiration of a customer tolling agreement. Personal care products revenues increased by $12.3 million mainly due to expansion with new retail customers and increased promotional volumes. Home and garden control products sales also increased by $8.2 million primarily driven by warmer weather extending the outdoor season compounded with seasonal inventory sales to retailers earlier than in the prior year. The decrease in small appliances sales of $20.6 million was mainly driven by a decline in North America sales due to softer volumes within the product category and increased competitor discounting during the holiday season.
The following table details the principal components of the change in the Consumer Products segment net sales from the Fiscal 2015 Quarter to the Fiscal 2016 Quarter (in millions):
|
| | | | |
| | Net Sales |
Fiscal 2015 Quarter Net consumer and other product sales | | $ | 1,067.8 |
|
Increase in global pet supplies | | 86.7 |
|
Increase in global auto care | | 73.7 |
|
Increase in consumer batteries | | 35.9 |
|
Increase in hardware and home improvement products | | 16.2 |
|
Increase in personal care products | | 12.3 |
|
Increase in home and garden control products | | 8.2 |
|
Decrease in small appliances | | (20.6 | ) |
Foreign currency impact, net | | (61.4 | ) |
Fiscal 2016 Quarter Net consumer and other product sales | | $ | 1,218.8 |
|
