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This excerpt taken from the SMG 10-K filed Nov 29, 2007. North
America
Segment net sales were $1.99 billion in fiscal 2007, an
increase of 3.9% from fiscal 2006. Excluding the impact of
acquisitions, net sales improved 2.5%, approximately 1.9% of
which was a result of pricing. Adverse weather conditions for
much of the core selling season disproportionately impacted the
lawns business, which includes both fertilizers and grass seed,
resulting in a 5.6% decline in net sales. The other core
businesses were less impacted by the weather, with net sales in
the gardening category (growing media and plant food) up 7.4%
and
Ortho®
up 2.9%. Net sales in our wild bird food business improved 13.5%
as we began to see success from the launch of
Scotts®
branded bird food at Wal*Mart, combined with significant pricing
increases in the latter portion of fiscal 2007. The increase in
net sales did not generate the gross margin improvement needed
to offset the growth in advertising and other SG&A
spending, with the result being a decline in segment operating
income of $15.8 million or 4.0%.
For fiscal 2006, segment net sales were $1.91 billion, an
increase of 14.8% from fiscal 2005. Excluding the impact of
acquisitions, sales improved 7.9%, approximately 1.9% of which
was a result of pricing. Each of the core businesses performed
well, with lawns business up 10.5%, gardening up 16.0%
benefiting from the very successful launch of
Miracle-Gro®
LiquaFeed®,
and
Ortho®
net sales down 1.5% due to an unfavorable season for weed
control products. The overall net sales growth and Project
Excellence savings, offset by a gross margin rate decline and
growth in advertising spending, led to an increase in segment
operating income of $35.8 million or 10.1%.
This excerpt taken from the SMG 10-K filed Dec 14, 2006. North
America
North America segment net sales were $1.91 billion in
fiscal 2006, an increase of 14.8% from fiscal 2005. Excluding
the impact of acquisitions, sales improved 7.9%, approximately
1.9% of which was a result of pricing. Each of the core
businesses performed well, with lawn fertilizers up 8% and
growing media up 17%. Plant food grew 12%, benefiting from the
very successful launch of
Miracle-Gro®
LiquaFeed®,
while grass seed grew 24%.
Ortho®
sales were flat to last year due to a unfavorable season for
weed control products.
During fiscal 2005, North America segment net sales increased
6.3%. Of the increase in North America net sales, approximately
2.3% was attributable to pricing. Within the North America
segment, Gardening Products net sales, which include growing
media and garden fertilizers, increased 9.8% with higher sales
of value-added
Miracle-Gro®
garden soils and potting mix, Shake ’N
Feed®
continuous release plant food and Organic
Choice®
garden soils. Net sales of
Ortho®
products increased by 11.0% in fiscal 2005, driven largely by
the successful launches of Home Defense
MAX®,
Weed-B-Gon®
MAX®,
and
Ortho®
Season-Long Grass and Weed Killer concentrate. Excluding the
favorable impact of foreign exchange rates, the Canadian group
of North America posted a 23.0% net sales increase in fiscal
2005. Unfavorable early season weather conditions adversely
impacted the Lawns group within North America, resulting in net
sales that were flat compared to fiscal 2004.
In fiscal 2006, North America segment operating income increased
$38.1 million or 11.1%. This increased operating income was
primarily the result of higher net sales and Project Excellence
savings, offsetting a gross margin rate decline and growth in
advertising spending.
In fiscal 2005, North America segment operating income increased
$37.8 million or 12.3%. Higher sales volume and gross
profits, product price increases, strong performance in the
Roundup®
business and moderate increases in SG&A spending more than
offset higher commodity and fuel costs, investments in the home
center sales team, and in research and development projects.
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