Helen of Troy's personal care sales fall again
first quarter, which combined with a series of write-downs led to a
profit slump.
The company reported that total sales for the period ending May 31 rose by 3.4 percent to $145m, representing a strong quarter for the company's household products business. But on the personal care front, where the company manufacturers for brands such as Vidal Sassoon and Revlon, as well as making its own brands, including SkinMilk and Brut, the company's fortunes were less encouraging. Personal care sales fall Personal care sales fell by 0.3 percent to $106.5m, reflecting what the company termed 'the continuing difficult retail environment'. The company's personal care operations appear to have been more significantly hit by the slump in the US, which has seen consumer spending power diminished by the credit crunch and inflation. Likewise the company's business has also been impacted by the rising cost of raw materials, which it has until now largely been able to counterbalance by raising its prices in specific areas. Charges hit bottom line As well as the mixed fortunes in the company's sales, the bottom line was also impacted by a series of write-downs, which included a $7.6m charge for intangible assets, $2.5m in bad debts and $2.6m on casualty insurance settlements. The bottom line meant that net income slumped by 45 percent for the quarter, from $10.1m in the corresponding period last year to $5.6m this year. The results are part of a similar pattern in the company's recent quarterly results, which have been particularly weak for the personal care business. Cosmetics continues to be weak spot For its full year 2007 results, released in mid-May, the company said that personal care sales during the period had fallen by 1.9 percent to reach $488.4m. Looking to the rest of the financial year, CEO Gerald Rubin said that the company's strategic plan for 2008 would remain firm. "We believe we are poised to effectively react to changes in the marketplace as they occur," said Rubin. "We stand ready to take advantage of improvements to the future retail environment."
