=Newell Brands (NWL) reported earnings on Fri 28 Oct 2016 (b/o)

Newell Brands beats by $0.05, misses on revs; raises low end of FY16 guidance; guides FY17 :

• Reports Q3 (Sep) adj. earnings of $0.78 per share, $0.05 better than the Capital IQ Consensus of $0.73; revenues rose 158.5% year/year to $3.95 bln vs the $4.06 bln Capital IQ Consensus, primarily due to the inclusion of net sales from the acquired Jarden business. Core sales grew 3.0 percent driven by strong results on the Writing, Baby, Food, and Appliance businesses partially offset by declines in Commercial Products and Outdoor Solutions. 
• Co issues in-line guidance for FY16, sees EPS of $2.85-2.90, excluding non-recurring items, vs. $2.86 Capital IQ Consensus. Reported net sales for 2016 are projected to grow between 122.5 and 128.0 percent and reported earnings per share to be $1.15 to $1.20, after absorbing ~$1.18 of one-time costs related to the Jarden and Tools transactions. Raised lower end of both 2016 full year guidance ranges to 3.5 to 4.0 percent core sales growth and normalized earnings per share of $2.85 to $2.90 from previous guidance of 3 to 4 percent core sales growth and normalized earnings per share of $2.75 to $2.90 per share.
• Co sees FY17 normalized EPS of $2.85-3.05, including $0.20 of dilution, net of interest benefits, related to the planned divestiture of about 10 percent of the company's portfolio, may not compare to $3.06 Capital IQ Consensus; core sales +3-4%. 
• Newell Brands recently announced an update of its corporate strategy designed to capture the unique value creation opportunity related to its new larger portfolio and broader geographic and retail presence. As part of this new strategy, the company plans to transform Newell Brands from a holding company to an operating company, consolidating 32 business units to 16 Global Divisions while investing to extend its design, innovation and brand development capabilities across a broader set of categories. As part of its portfolio optimization, the company plans to divest businesses representing about $1.5 billion of annualized revenue. On October 12, 2016 the company announced a definitive agreement to sell the Tools business for $1.95 billion to Stanley Black & Decker. The sale is subject to customary conditions, including regulatory approval, and is expected to close in the first half of 2017. The company intends to use the available cash proceeds from divestitures primarily for accelerated debt repayment, with the goal of achieving the targeted leverage ratio of 3 to 3.5 times, faster than the original commitment of two to three years from the date of the Jarden combination.