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WD40 Company Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: July 8, 2011 04:32PM

WD40 Company (WDFC) filed Quarterly Report for the period ended 2011-05-31. Wd40 Company has a market cap of $704.7 million; its shares were traded at around $41.68 with a P/E ratio of 20.7 and P/S ratio of 2.1. The dividend yield of Wd40 Company stocks is 2.6%. Wd40 Company had an annual average earning growth of 2.2% over the past 10 years. GuruFocus rated Wd40 Company the business predictability rank of 2-star.



Highlight of Business Operations:

Sales of multi-purpose maintenance products in the Americas segment increased $1.8 million, or 5%, for the three months ended May 31, 2011 compared to the corresponding period of the prior fiscal year. This sales increase was primarily driven by higher sales of WD-40 products in the U.S. and Canada, which were up 3% and 24%, respectively, for the three months ended May 31, 2011 compared to the corresponding period of the prior fiscal year. The increase in the U.S. was primarily due to a major promotional program for the WD-40 products which was conducted during the three months ended May 31, 2011 with certain of our key customers. Although this was a major promotional program in the U.S. and sales increased from period to period, sales of the WD-40 products have been negatively impacted in fiscal year 2011 by reduced product offerings and lost promotional opportunities with certain of our key customers. The increase in Canada was due to a higher level of promotional activities for the WD-40 products from period to period. As a result of fluctuations in the promotional patterns with certain of our key customers, particularly those in the mass retail, home center and warehouse club channels, it is common for our sales to vary period over period and year over year.

Sales of homecare and cleaning products in the Americas segment decreased $2.0 million, or 18%, for the three months ended May 31, 2011 compared to the corresponding period of the prior fiscal year. Although we remain focused on stabilizing the sales of our homecare and cleaning products, sales of these products continue to be negatively impacted by competition, category declines, lost distribution, reduced product offerings and the volatility of orders from and promotional programs with certain customers, particularly those in the warehouse club and mass retail channels. Sales of homecare and cleaning products in the U.S., which is where the majority of such sales originate, decreased 23% from period to period. This sales decrease was driven primarily by lower sales of Spot Shot products, which were down 23% in the U.S. for the three months ended May 31, 2011 compared to the corresponding period of the prior fiscal year. This decrease in Spot Shot sales was due to several factors, including lost promotional opportunities with our customers, specifically those within the warehouse club channel, category declines, lost distribution and the effect of competitive factors. Sales of our automatic toilet bowl cleaners in the Americas segment also decreased $0.6 million, or 18%, from period to period due to competitive factors, category declines and lost distribution.

For the Americas segment, 80% of sales came from the U.S., and 20% of sales came from Canada and Latin America combined for the three months ended May 31, 2011, compared to the distribution for the three months ended May 31, 2010, when 83% of sales came from the U.S., and 17% of sales came from Canada and Latin America combined.

Switzerland and Belgium). Overall, sales from direct markets increased $1.5 million, or 8%, for the three months ended May 31, 2011 compared to the corresponding period of the prior fiscal year. We experienced sales increases throughout the Europe segment for the three months ended May 31, 2011 compared to the corresponding period of the prior fiscal year, with percentage increases in sales as follows: Italy, 25%; Iberia and France, 13% each; U.K., 4%; and the Germanics sales region, 3%.

In the countries in which we sell through local distributors, sales decreased $0.4 million, or 4%, for the three months ended May 31, 2011 compared to the corresponding period of the prior fiscal year, primarily due to decreased sales of WD-40 products in the Middle East as a result of unstable economic conditions. The distributor markets accounted for 30% of the Europe segment’s total sales for the three months ended May 31, 2011, compared to 33% for the corresponding period of the prior fiscal year.

Sales in Asia, which represented 63% of the total sales in the Asia-Pacific segment for the three months ended May 31, 2011, increased $1.3 million, or 22%, for the three months ended May 31, 2011 compared to the corresponding period of the prior fiscal year primarily due to improved economic conditions throughout the Asia region. The distributor markets in the Asia region experienced a sales increase of

Read the The complete Report



Stocks Discussed: WDFC,
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