Scotts Miracle-Gro (NYSE: SMG) reported Q1 EPS of $0.39, $1.15 better than the analyst estimate of ($0.76). Revenue for the quarter came in at $748.6 million versus the consensus estimate of $624 million.

GUIDANCE:

Scotts Miracle-Gro sees FY2021 EPS of $8.00-$8.40, versus the consensus of $8.26.

• The Company said it now expects fiscal 2021 sales growth of 1 to 6 percent compared to 0 to 5 percent previously. Hawthorne sales guidance was increased to a range of 20 to 30 percent from a previous range of 15 to 20 percent. Guidance for U.S. Consumer sales of 0 to minus 5 percent was reaffirmed. Guidance for non-GAAP adjusted EPS of $8.00 to $8.40 was reaffirmed as the Company noted that it now expects SG&A to decline 3 to 8 percent from 2020 spending levels, compared to a previous estimate of a 6 to 11 percent year-over-year decline. The adjusted gross margin rate is now expected to decline 125 to 175 basis points year-over-year due to higher commodity costs and segment mix more heavily skewed to the lower margin Hawthorne business than previously contemplated. The revised gross margin rate guidance compares to a previous expected decline of 50 basis points.

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