NWL Lowers FY11 EPS Guidance

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Last Update: 03-Jun-11 10:05 ET

Newell Rubbermaid (NWL $15.01 -1.96) believes that its second quarter performance will be lower than analysts' consensus expectations as reported by First Call.

Normalized earnings per share could be as much as 15% lower than analysts' current expectations.

For its fiscal year 2011, the company lowered its earnings guidance to $1.60 to $1.67 versus $1.69 Thomson Reuters consensus, down from $1.67 to $1.70; sees core sales growth of 3% to 4%, down from 4% to 5% (+5.2% as reported) in light of disappointing economic conditions and weak consumer spending trends in the U.S. market.

"Persistent softness in the U.S. economy and increased inflationary pressure have caused us to revise our outlook for the balance of the year. We still expect solid core sales growth versus our 2010 results; however, our revised expectations are lower than they were just a short while ago. Several of our large retail customers are revising downward their U.S. growth expectations for the year, pointing to weak consumer confidence levels and lower-than-expected spending trends, particularly in the semi-discretionary categories in which we compete. These lowered expectations are impacting customer ordering patterns and, as a result, we think it prudent to reflect those assumptions for lower growth in our own sales projections for the year."