Newell Rubbermaid Inc., the maker of Sharpie pens and Calphalon cookware, said Friday it would put its Hardware and Teach Platform businesses up for sale as part of a restructuring plan to boost profitability.
The businesses, which include brands such as Bulldog, Ashland and Amerock, represented about $300 million in revenue in 2012, the Atlanta-based company said in a statement. Total revenue last year was $5.9 billion, up less than 1 percent from the prior period.
Chief Executive Officer Michael Polk has been cutting jobs and reducing operating units in an effort to improve margins and boost sales outside the U.S. Last year, Newell announced plans to eliminate 10 percent of its work force.
Newell shares have gained about 19 percent this year compared with a 12 percent advance for the Standard & Poor’s 500 Index.
Newell reported adjusted first-quarter earnings per share of 35 cents, topping the 32-cent average of analysts’ estimates compiled by Bloomberg News. Net income was $54.2 million, or 19 cents a share, for the first quarter. That was down from $79.3 million, or 27 cents a share, in the prior year.
The company’s operations include a food container manufacturing facility in Mogadore and a distribution and storage center in Brimfield Township.
“We’ve had a good start to the year and made further progress driving the Growth Game Plan into action,” said Polk in a prepared statement.
“Underlying financial results on our continuing business were solid, with particularly strong performances from our Commercial Products, Tools and Baby & Parenting operating segments.”
Polk added that the units to be sold “do not fit with our strategy. The divestiture of these businesses will help to create a faster growing, higher margin and more focused portfolio, enabling us to drive accelerated performance.”
The company said its financial report was restated to reflect that the sale means those divisions are classified as discontinued operations.
First quarter 2013 net sales were $1.24 billion, a 0.8 percent decline versus prior year results.
Newell said earnings per share were 35 cents, a year-over-year increase of 9.4 percent. It credited the results to “a more favorable tax rate, lower interest expense and improved operating performance.”
The company said it returned $78.3 million to shareholders through a dividend payout of $44.5 million and the repurchase of 1.4 million shares at a cost of $33.8 million.
Newell said its 2013 financial guidance is “core sales growth in a range from 2 to 4 percent,” operating margin improvement of up to 0.2 percent, earnings per share of $1.78 to $1.84 and operating cash flow of $575 to $625 million.
