Scotts Miracle-Gro Sees FY14 Adj. EPS In Line With View - Quick Facts

(RTTNews) - Lawn and garden care products maker Scotts Miracle-Gro Co. (SMG) said Friday that it expects adjusted earnings from continuing operations for fiscal 2014 to be in the range of $3.05 to $3.20 per share, an increase of 10 to 15 percent.

In advance of its Analyst & Investor Day, the company noted that it expects company-wide net sales to increase by approximately 2 to 3 percent in fiscal 2014 on flat unit volume, strategic pricing, the recent acquisition of the Tomcat consumer rodent control business and the continued growth of its LawnService business.

Analysts polled by Thomson Reuters expect the company to report earnings of $3.17 per share and revenues of $2.89 billion fiscal 2014. Analysts' estimates typically exclude special items.

The company anticipates improvement in gross margin rate of approximately 100 basis points and an increase in selling, general & administrative expenses or SG&A of approximately 3 to 4 percent for fiscal 2014.

Operating margin rate is expected to be in the range of 12.5 to 13 percent in fiscal 2014. Interest expense is forecasted to be lower by $5 to $7 million compared to fiscal 2013.

The company's operating cash flow is expected to be approximately $275 million in fiscal 2014.

"We remain confident in the strength of our brands and continue to see commitment to the category from consumers and our retail partners," said Jim Hagedorn, chairman and chief executive officer.

In addition, the company said it is in the final phases of renegotiating its existing credit facility and expects to have it completed by the end of the calendar year. The amendment and extension will extend the facility's maturity through December 2018, decrease pricing and relax certain restrictive covenants.

Additionally, the company announced it will exercise its call option on the $200 million of 7.25 percent senior notes issued in 2010. The company expects the combination of these actions will reduce its overall cost of debt by approximately 60 basis points.

The company is holding its Analyst & Investor Day today.