Spectrum Brands Holdings Inc., a global consumer products company and parent company of the ArmorAll brand, has reported record performance for the first quarter of fiscal 2016 ended Jan. 3, 2016, and reiterated expectations for a seventh consecutive year of record results for fiscal 2016.

During January 2016, Spectrum Brands’ iconic Rayovac brand began a yearlong celebration of its 110th anniversary as a worldwide leader in battery power and innovation with a rich heritage of state-of-the-art products offering consumers more power for the money. Also in January, the company’s Baldwin Hardware brand turned “70 Years Bold,” launching a celebration of the brand’s rich history and milestone 70th anniversary throughout 2016.

Fiscal 2016 First Quarter Highlights

Net sales of $1.22 billion in the first quarter of fiscal 2016 increased 14.1 percent compared to $1.07 billion last year. Excluding the negative impact of $61.4 million of foreign exchange and sales from recent acquisitions of $144.9 million, organic sales increased 6.3 percent from the prior year. 

Net income of $73.6 million and diluted earnings per share of $1.24 in the first quarter of fiscal 2016 compared to net income of $49.8 million and diluted earnings per share of 94 cents in fiscal 2015.

Adjusted diluted earnings per share, a non-GAAP measure, of $1.01 in the first quarter of fiscal 2016 decreased compared to $1.07 last year predominantly due to the impact of higher interest expense and common shares outstanding and the seasonality of the Global Auto Care business acquired in May 2015.

“Our solid first quarter performance is an excellent start to achieving a seventh consecutive year of record performance in fiscal 2016,” said Andreas Rouvé, CEO of Spectrum Brands Holdings. “Highlights included record home and garden and HHI results, and strong performances from our global battery and legacy pet businesses, and, regionally, in the U.S. as well as in Europe and Latin America on a currency neutral basis in the face of expected and significant foreign currency headwinds,” said Rouvé. “We are especially pleased with the improved performances of our North American battery and legacy pet businesses which were challenged in fiscal 2015.

“Our organic net sales growth of 6.3 percent was broad-based, reflecting contributions from virtually all businesses globally,” said Rouvé. “Organic adjusted EBITDA grew at a faster rate as every business improved. Higher margins benefited from the leverage of our fixed global infrastructure and shared services platform, and from another quarter of solid cost improvement savings.

“New product introductions also contributed as we work to step up our vitality rate in fiscal 2016 and beyond and selectively invest more behind some of our key brands,” he added. “The integration of Global Auto Care continues on a fast and smooth timetable with expected synergies being realized.

“Looking to the rest of the year, we continue to expect healthy top- and bottom-line growth from a mix of new products, new customers, distribution and market share gains, increased cross-selling, geographic expansion and continuous improvement savings along with expense controls,” he said. “As in recent years, the second half of our fiscal year should again be larger than the first half, given the seasonal nature of some of our businesses.

“We are managing the business for long-term, sustainable organic growth and therefore are selectively increasing our spending on growth initiatives,” said Rouvé. “We are making good progress in implementing our Spectrum First organic growth accelerators.”

Global Auto Care Segment Results

The Global Auto Care (GAC) segment reported net sales of $73.7 million, adjusted net income of $8.8 million and adjusted EBITDA of $19.2 million in the first quarter of fiscal 2016. U.S. appearance, performance and refrigerant category consumption was strong, helped by unseasonably warm weather. Armor All experienced especially solid point-of-sale at key U.S. customers. Adjusted EBITDA margin was 26.1 percent.

Fiscal 2016 Outlook

Spectrum Brands expects fiscal 2016 net sales, as reported, to increase in the high-single digit range compared to fiscal 2015 reported net sales of $4.69 billion, including the positive impacts of the acquisitions of the European pet food business on Dec. 31, 2014, Salix Animal Health on Jan. 16, 2015, and Armored Auto Group on May 21, 2015, along with an anticipated negative impact from foreign exchange of approximately 200 to 220 basis points based on current spot rates.