Jarden Corp. sees the recent drop in oil prices as giving it a tailwind in the second half of this year because many of the group's products, including its household items, are made with oil derivatives and it typically takes six to nine months for lower commodity costs to affect the supply chain.
In fourth quarter ended last Dec. 31, Jarden's Outdoor Solutions segment, or JOS, turned around to a positive operating result of $11.6 million against a loss of $1.9 million in the same period a year earlier, although the segment's revenues inched up by only 0.5 percent to $621.1 million. Organically, they increased by 5 percent, driven by broad gains at Coleman, Völkl, fishing and technical apparel, an area where the group is represented by brands such as Marmot Mountain.
For the full financial year, JOS' operating profit slid by 1.3 percent to $193.4 million on 0.5 percent higher revenues of $2,739.2 million. Organically, sales rose by 1.9 percent for the year. The group's total net sales went up by 10.0 percent to $2.44 billion in the fourth quarter, delivering an adjusted gross margin of 34.5 percent, up from 33.0 percent in the year-ago period. Adjusted net earnings went up to $220 million from $167 million.
Commenting on the situation in the world snow sports market, the management said the European Union and the U.S. West Coast were in terrible shape, the U.S. Rockies “okay,” New England “healthy” and Japan “good.”
Jarden has moved its snowboard manufacturing operations to a new plant in China and plans to transfer its ski business there this year.
For the Jarden group as a whole, annual sales grew by 12.7 percent to $8.29 billion, with an 5.8 percent increase on an organic basis. The adjusted gross margin rose to 32.2 percent from 30.3 percent and the adjusted net income increased to $512 million from $413 million.
