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[May 2005]
Jacuzzi Brands Second Quarter
Jacuzzi Brands Inc (West Palm Beach, FL, USA) recorded net sales for the second quarter of 2005 of US$337.6 million, an increase of 1.4% from the second quarter of 2004. Operating income increased by 18.3% to US$21.3 million, up from US$18 million in Q2 2004. Net earnings for Q2 2005 increased by 27.1%, from US$5.9 million up to US$7.5 million.
Higher consolidated net sales were driven primarily by the 15% increase in Plumbing Products sales. The Plumbing products and Bath products segments each reported increases in operating income, which offset a slight decline in operating income at Rexair. Q2 net income included restructuring charges of US$1.2 million compared to US$3 million in Q2 2004. Net income this time was favourably impacted by a reduced effective tax rate resulting from a US$2.9 million tax benefit recognised upon completion of a Federal tax audit.
Sales in the Bath Products segment decreased by 1.9%. A US$3.6 million foreign currency benefit was offset by lower sales in the UK Bath and Sink businesses caused by a decline in the UK market, lower domestic spa sales and a US$1.7 million decline in Eljer branded sales attributable to the previously announced product rationalisations.
Bath and Sink sales in the UK declined as the market abruptly slowed in the second half of Q2 and retailers reduced orders to address higher inventory levels. President and COO Donald Devine confirmed that Jacuzzi had reduced personnel numbers in the UK Bath operations in Bradford to match the lower volume levels. He said that the company expected the UK markets to slowly improve throughout the remainder of the year. Managers in the Jacuzzi Bath business now report directly to Mr Devine, promoting a sharpened focus on sales growth, cost reduction and margin expansion.
ENDS