WD-40 Co. (WDFC) Misses Q1 EPS by 10c, Revenues Miss; Offers FY20 EPS Guidance

January 9, 2020 4:09 PM EST

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WD-40 Co. (NASDAQ: WDFC) reported Q1 EPS of $0.88, $0.10 worse than the analyst estimate of $0.98. Revenue for the quarter came in at $98.6 million versus the consensus estimate of $103.97 million.

Financial Highlights and Summary

  • Total net sales for the first quarter were $98.6 million, a decrease of 3 percent compared to the prior year fiscal quarter.
  • Translation of the Company's foreign subsidiary results from their functional currencies to U.S. dollars had an unfavorable impact on sales for the first quarter. On a constant currency basis, total net sales for the first quarter would have been $100.8 million, relatively constant compared to the prior year fiscal quarter.
  • Net income for the first quarter was $12.2 million, a decrease of 8 percent from the prior year fiscal quarter.
  • Diluted earnings per share were $0.88 compared to $0.95 in the prior year fiscal quarter.
  • Gross margin percentage was 54.3 percent compared to 55.1 percent in the prior year fiscal quarter.
  • Selling, general and administrative expenses were down $0.1 million in the first quarter to $32.6 million compared to the prior year fiscal quarter.
  • Advertising and sales promotion expenses were down 6 percent to $5.6 million compared to the prior year fiscal quarter.

"If you follow us quarter to quarter, you may not like our results this quarter," said Garry Ridge, WD-40 Company's chairman and chief executive officer. "Our business is one in which fluctuations in the performance of our markets from quarter to quarter are not unusual. That's why we don't issue quarterly guidance and why we frequently caution investors not to follow us too closely quarter to quarter."

"We are playing the infinite game which is why it\'s more important for investors to understand that our long-term strategic drivers are performing in-line with our expectations, than it is for them to be concerned about the performance of a particular market or segment in a finite period."

"Overall, we acknowledge that our first quarter does not reflect the revenue growth we would like to see in our business. However, we expect a solid, steady year ahead as we continue to put our efforts behind the strategic initiatives we believe will help us achieve our 'probably wrong and roughly right\' long-term revenue objectives," Ridge concluded.


WD-40 Co. sees FY2020 EPS of $4.74-$4.83, versus the consensus of $4.79.

"Our guidance reflects the Company's current view of the business," said Jay Rembolt, WD-40 Company's vice president and chief financial officer. "The revenue softness we experienced in the first quarter was primarily driven by the timing of customer orders and we expect that sales activity will shift into later quarters. We remain comfortable with our current guidance range and are reiterating it today."

For earnings history and earnings-related data on WD-40 Co. (WDFC) click here.

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