Newell Brands (NWL) Q1 2022 Earnings Call Transcript

For the period ending March 31, 2022

April 29, 2022 9:30 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good morning, and welcome to Newell Brands' First Quarter 2022 Earnings Conference Call. [Operator Instructions]. As a reminder, today's conference is being recorded. A live webcast of this call is available at ir.newellbrands.com.

I will now turn the call over to Sofya Tsinis, Vice President of Investor Relations. Ms. Tsinis, please go ahead.

Sofya Tsinis

Thank you. Good morning, everyone. Welcome to Newell Brands' First Quarter Earnings call. On the call with me today are Ravi Saligram, our President and CEO; and Chris Peterson, our CFO and President, Business Operations.

Before we begin, I'd like to inform you that during the course of today's call, we will be making forward-looking statements, which involve risks and uncertainty. Actual results and outcomes may differ materially, and we undertake no obligation to update forward-looking statements. I refer you to the cautionary language and risk factors available in our earnings release, our Form 10-K, Forms 10-Q and other SEC filings available on our Investor Relations website for a further discussion of the factors affecting forward-looking statements.

Please also recognize that today's remarks will refer to certain non-GAAP financial measures, including those we refer to as normalized measures. We believe these non-GAAP measures are useful to investors, although they should not be considered superior to the measures presented in accordance with GAAP. Explanations of these non-GAAP measures and available reconciliations between GAAP and non-GAAP measures can be found in today's earnings release and tables as well as in other materials on Newell's Investor Relations website.

Thank you. And now I'll turn the call over to Ravi.

Ravichandra Saligram

Thank you, Sofya. Good morning, everyone, and welcome to the New Newell on our first quarter call. We are pleased with the strong start to 2022. Building on the momentum from the prior quarters, as our team remains laser-focused on executing with excellence in a challenging environment.

Core sales grew 6.9% against a difficult 20.9% comparison. While normalized operating income and normalized earnings per share increased 10.4% and 20%, respectively, despite significant ongoing inflation. This demonstrates the power of our diversified portfolio and the nimbleness of our model. We're significantly better today at leveraging our brands to scale growth and efficiency.

Our strategy is working. And we have put a strong foundation in place for sustainable and profitable growth. Q1 marked the seventh consecutive quarter of core sales growth for your brands. In Q1, our core sales growth was driven by pricing as volume was relatively flat. Core sales grew in 5 of 7 business units, including food, driving Outdoor & Recreation, Baby and Commercial. The Outdoor & Recreation and Food businesses led the charge with double-digit increases versus the prior year period despite difficult comparisons. Home Fragrance and Home Appliances declined in the first quarter as they lapped a significant surge in demand in the year ago period due to the pandemic and the passage of stimulus in the U.S., importantly, on both a 2-year and 3-year stack basis, core sales increased in the double-digit range for all 7 business units a fantastic achievement.