Inflation has created a sticky situation for Newell Brands.
The consumer products company cut its financial guidance for the third quarter and the full-year Tuesday, saying inflation-pinched consumers were pulling back on spending more than it had expected.
Newell is the maker of Rubbermaid Tupperware, Elmer’s Glue, Sharpie pens, Krazy Glue, and Oster kitchen appliances.
“Although we remain enthusiastic about the back-to-school season and continue to see solid growth in the Commercial business, we have experienced a significantly greater than expected pullback in retailer orders and continued inflationary pressures on the consumer. As a result of these developments and our more cautious posture for the balance of the year, we are adjusting our expectations for the second half of 2022,” said Newell CEO Ravi Saligram.
The company said it now expects third-quarter earnings of between 46 cents a share and 51 cents a share, down from its earlier guidance for 50 cents a share to 54 cents a share. The company said sales for its third quarter are forecast to be between $2.21 billion to $2.32 billion, down from the previous guidance of $2.39 billion to $2.50 billion.
For the full year, Newell says it expects earnings to come in between $1.56 a share to $1.70 a share and sales of $9.37 billion to $9.58 billion. Its prior guidance was for earnings in the range of $1.79 a share to $1.86 a share and sales the range of $9.76 billion to $9.98 billion.
The company had said it expected core sales to decline in the third quarter by one percent to five percent. It now expects a decline of between eight percent and 12 percent. For the year, the previous guidance had been for core sales to be flat to up two percent. Now Newell expects core sales to fall between two and four percent.