Overview

* Scotts Miracle-Gro ( SMG ) fiscal Q3 sales fall 1%, missing analyst expectations, per LSEG data

* Adjusted EPS for fiscal Q3 beats consensus, reflecting improved operational efficiency

* Company reaffirms full-year non-GAAP fiscal 2025 guidance, indicating confidence in strategy

Outlook

* Scotts Miracle-Gro ( SMG ) reaffirms full-year non-GAAP fiscal 2025 guidance

* Company expects U.S. Consumer net sales to grow low single-digit, excluding non-repeat sales

* Scotts Miracle-Gro ( SMG ) anticipates non-GAAP adjusted gross margin of ~30% for fiscal 2025

* Company projects non-GAAP adjusted EBITDA of $570 mln to $590 mln for fiscal 2025

* Scotts Miracle-Gro ( SMG ) expects non-GAAP adjusted EPS of at least $3.50 for fiscal 2025

* Company forecasts free cash flow of approximately $250 mln for fiscal 2025

Result Drivers

* PRODUCT MIX - Improved mix driven by non-recurrence of lower-margin sales and increased sales of higher-margin branded products

* LEVERAGE IMPROVEMENT - Leverage improved by over 1.3x compared to last year, reflecting better financial health

Key Details

Metric Beat/Mis Actual Consensu

s s

Estimate

Q3 Sales Miss $1.19 $1.23

bln bln (8

Analysts

)

Q3 Beat $2.59 $2.27 (8

Adjusted Analysts

EPS )

Q3 EPS $2.54

Q3 Net $149.10

Income mln

Q3 Beat $256.10 $251 mln

Adjusted mln (7

EBITDA Analysts

)

Q3 Gross 378.0%

Margin

Q3 Basic $2.58

EPS

Q3 $215 mln

Operatin

g Income

Q3 $207.30

Pretax mln

Profit

Analyst Coverage

* The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 6 "strong buy" or "buy", 4 "hold" and no "sell" or "strong sell"

* The average consensus recommendation for the agricultural chemicals peer group is "hold."

* Wall Street's median 12-month price target for Scotts Miracle-Gro Co ( SMG ) is $75.00, about 9.5% above its July 29 closing price of $67.86

* The stock recently traded at 16 times the next 12-month earnings vs. a P/E of 14 three months ago

Press Release:

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)