Newell's higher profit helped by lower tax rate
(Reuters) - Consumer products maker Newell Rubbermaid Inc (NWL.N) reported a better-than-expected quarterly profit on Friday, buoyed by its business in emerging markets and a lower tax rate, but 2013 profit may fall short of Wall Street expectations.
Under Chief Executive Mike Polk, who took the Newell helm in July 2011, the maker of Sharpie markers and Rubbermaid storage containers has cut jobs, consolidated manufacturing and distribution facilities, and reduced the number of business units to control costs.
Newell, which also makes Graco strollers, Calphalon cookware and Paper Mate pens, has now met or exceeded Wall Street expectations for profit and sales for six consecutive quarters.
Newell's forecast for 2013 suggests it is being cautious. It expects earnings of $1.78 to $1.84 per share, excluding special items, while analysts were looking for $1.82, according to Thomson Reuters I/B/E/S.
"We expected conservative 2013 guidance and believe the investments will pay off," said BMO Capital Markets analyst Connie Maneaty, who has an "outperform" rating on Newell shares.
The shares closed at $23.48 on Thursday, near a nearly five-year high. The shares rose 37.9 percent last year.
Fourth-quarter net income rose to $101.9 million, or 35 cents per share, from $80.4 million, or 27 cents per share, a year earlier.
Excluding one-time items such as restructuring costs, Newell earned 43 cents per share, beating analysts' average estimate by a penny. The tax rate on those adjusted earnings declined to 20.7 percent from 23 percent a year earlier.
Maneaty said she had expected a tax rate of 26 percent.
Net sales rose 1.6 percent to $1.52 billion, meeting analysts' expectations. Excluding the impact of foreign currency fluctuations, sales rose 2.2 percent.
The company said it is generating strong sales growth in emerging markets, in particular in Latin America.
Newell said this year's sales should rise 1 percent to 3 percent, or 2 percent to 4 percent excluding foreign currency fluctuations.
(Reporting by Jessica Wohl in Chicago; editing by John Wallace)
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