Newell Brands May Initiate Wintersports Brand Sell Off Following Jarden Acquisition.
Newell Brands Inc. floated its plans to offload product lines with $250 million in annual sales over the next two to three years will slow core sales at Jarden Corp. in fiscal 2016.
The acquisition gave Newell control of a quiver full of leading ski and snowboard brands that may now be on the block. The company’s core sales growth guidance assumes legacy Newell Rubbermaid core sales growth of 4 to 5 percent and legacy Jarden core sales growth of 2 to 4 percent, which includes the negative impact of planned product line exits. Jarden core sales growth of 2 to 4 percent is roughly in line with Jarden’s pre-transaction long term “organic growth” target of 3 to 5 percent.
Jarden’s Outdoor Solutions segment manufactures or sources, markets and distributes global consumer active lifestyle products for outdoor and outdoor-related activities. Alpine and nordic skiing, snowboarding, snowshoeing and in-line skating products are sold under brand names such as Atlas, Full Tilt, K2, Line, Little Bear, Madshus, Marker, Morrow, Ride, Tubbs, Völkl and 5150 Snowboards. The Company also sells high performance technical and outdoor apparel and equipment under brand names such as Adio, Ex Officio, Marmot and Planet Earth.
The company announced it will reaffirm its fiscal year 2016 outlook, as provided in its first quarter 2016 earnings press release dated April 29, 2016, during its presentation tomorrow at the Deutsche Bank Global Consumer Conference in Paris, France.
The company is reaffirming its full year 2016 guidance as follows:
Year Ending December 31, 2016
Newell Brands core sales growth 3.0% to 4.0%
Normalized earnings per share $2.75 to $2.90
Industry experts have raised questions about the future of the wintersports businesses in the Newell group. The announcement of Newell’s intention to dump some brands will fuel these questions.
Jarden's major winter sports brands include the K2, Marker and Volkl ski brands, with K2 in turn owning various brands including Line, Full Tilt and Madshus.