Helen of Troy Limited reported that fiscal third-quarter net sales at its Home & Outdoor segment, which includes OXO, Hydro Flask and Osprey, increased 3.1 percent, to $235.9 million for the three-month period ended November 30, compared to $228.9 million on the prior-year corresponding period.
The increase was said to be driven by organic growth of $4.5 million, or 2.0 percent, primarily from higher home category sales in the club, online and brick & mortar channels, consumer demand and expanded distribution, insulated beverageware growth in the online channel, driven by expanded distribution and replenishment of the new travel tumbler, higher travel related sales in the outdoor category, and higher sales in the closeout channel.
The above factors were partially offset by reduced sales to Bed, Bath & Beyond due to its bankruptcy, a decline in brick & mortar sales in the insulated beverageware category and lower home category sales in the closeout channel. These factors were also partially offset by increased consolidated online channel sales and consumer demand for products in the home and travel categories.
Home & Outdoor operating income was $49.5 million, or 21.0 percent of segment net sales revenue, in the fiscal third quarter, compared to $30.8 million, or 13.5 percent of segment net sales revenue, in the prior-year period. The 750 basis point increase in segment operating margin was primarily due to an allocated portion of a $16.2 million gain on the sale of distribution and office facilities in El Paso, TX, lower inbound and outbound freight costs, a $4.5 million decrease in restructuring charges, lower commodity costs, lower salary and wage costs primarily, as a result of Project Pegasus role reductions, and a more favorable customer mix.
The above factors were partially offset by higher distribution expenses, increased marketing expenses, increased inventory obsolescence expenses, higher share-based compensation expenses, increased annual incentive compensation expenses, and increased depreciation expenses primarily due to a new distribution facility.
Adjusted operating income decreased 0.2 percent to $39.8 million, or 16.9 percent of segment net sales revenue, compared to $39.9 million, or 17.4 percent of segment net sales revenue, in the year-ago period.
Photo courtesy Hydro Flask
