Newell Rubbermaid Inc. (NYSE:NWL) 1Q11 Beats Expectations

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On April 29, 2011, Newell Rubbermaid Inc. (NYSE:NWL) reported first fiscal quarter results above consensus was primarily tax rate-driven The Company reported first fiscal quarter net income of $75.7 million or 25 cents a share, an increase of 29.62% from net income of $58.4 million or 19 cents a share, in the prior year, above consensus of 30 cents a share. Excluding called-out items, normalized EPS were $0.30 compared with consensus estimate of $0.28. Net sales during the quarter declined 0.3% year over year to $1.303 billion from $1.306 billion in the same quarter, a year earlier, above the consensus of $1.332 billion. Core sales declined 1.7% offset partially by 1.4% of favorable currency translation.  Adjusted for $40 million of timing shifts due to SAP pre-buy in the prior year quarter and some year-end pull forward to qualify for volume rebates, core sales would have increased 1.5%.  Office Products sales increased 3.8% year-over-year to $365 million. Gross margins were quite strong in the quarter, expanding 160 basis points year over year to 37.7%. This increase in gross margin is due to productivity gains and improved mix, which more than offset commodity cost inflation. The Company reaffirmed its FY 2011 EPS guidance range of $1.67 to $1.70 which assumes core sales growth of 4% to 5%, 1% to 2% of favorable currency translation, and 50 to 75 basis points of gross margin expansion. The Company’s fiscal 2011 normalized EPS expectation excludes between $80 and $85 million of restructuring and other Plan-related costs associated with the Company’s European Transformation Plan. Analysts on an average are expecting the Company to report revenue of $6.04 billion and EPS of $1.69 for fiscal 2011. Shares of a global marketer of consumer and commercial products went down by 5.47% to $18.65. Volume of 5.97 million shares has been traded compared to the daily average of 2.39 million shares. The 52 week range of the stock is $14.14-$20.38. The market capital of the stock stands at $5.79 billion with P/E of 19.67. Its products are marketed under a portfolio of brands, including Rubbermaid, Graco, Aprica, Levolor, Calphalon, Goody, Sharpie, Paper Mate, Dymo, Parker, Waterman, Irwin, Lenox and Technical Concepts. Its multi-product offering consists of consumer and commercial products in three business segments: Home & Family; Office Products, and Tools, Hardware & Commercial Products.