Newell Brands Inc. (NWL) Bundle
A Brief History of Newell Brands Inc.
Newell Brands Inc. (NWL), a leading consumer goods company, has experienced significant transformations over the years. As of 2024, the company operates across various segments, including Home and Commercial Solutions, Learning and Development, and Outdoor and Recreation.
Recent Financial Performance
For the three months ended September 30, 2024, Newell Brands reported net sales of $1,947 million, a decrease of 4.9% compared to $2,048 million in the same period of 2023. The gross profit for this quarter was $679 million, resulting in a gross margin of 34.9%, up from 30.3% the previous year. The operating loss for this quarter stood at $121 million, compared to a loss of $159 million in Q3 2023.
| Financial Metrics | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Net Sales | $1,947 million | $2,048 million | (4.9%) |
| Gross Profit | $679 million | $621 million | 9.3% |
| Gross Margin | 34.9% | 30.3% | 4.6% |
| Operating Loss | ($121 million) | ($159 million) | 23.9% |
Year-to-Date Financial Overview
For the nine months ended September 30, 2024, Newell Brands reported net sales of $5,633 million, down 7% from $6,057 million in the prior year. The gross profit for this period was $1,882 million, with a gross margin of 33.4%, up from 28.6% in 2023. The operating income for the same period reached $58 million, a notable improvement from the operating loss of $75 million reported in 2023.
| Financial Metrics | YTD 2024 | YTD 2023 | Change (%) |
|---|---|---|---|
| Net Sales | $5,633 million | $6,057 million | (7.0%) |
| Gross Profit | $1,882 million | $1,732 million | 8.7% |
| Gross Margin | 33.4% | 28.6% | 4.8% |
| Operating Income | $58 million | ($75 million) | NM |
Segment Performance
Newell Brands operates in three primary segments. The Home and Commercial Solutions segment reported net sales of $1,047 million in Q3 2024, down from $1,123 million in Q3 2023. The Learning and Development segment saw an increase in net sales to $717 million, up from $694 million. The Outdoor and Recreation segment experienced a decline in net sales to $183 million from $231 million.
| Segment | Q3 2024 Net Sales | Q3 2023 Net Sales | Change (%) |
|---|---|---|---|
| Home and Commercial Solutions | $1,047 million | $1,123 million | (6.8%) |
| Learning and Development | $717 million | $694 million | 3.3% |
| Outdoor and Recreation | $183 million | $231 million | (20.8%) |
Balance Sheet Highlights
As of September 30, 2024, Newell Brands reported total assets of $11,773 million and total liabilities of $8,913 million, resulting in stockholders' equity of $2,860 million. The company had cash and cash equivalents amounting to $494 million, up from $332 million at the end of 2023.
| Balance Sheet Item | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Total Assets | $11,773 million | $12,163 million |
| Total Liabilities | $8,913 million | $9,051 million |
| Stockholders' Equity | $2,860 million | $3,112 million |
| Cash and Cash Equivalents | $494 million | $332 million |
Impairment Charges
In Q3 2024, Newell Brands recorded significant non-cash impairment charges, including $260 million related to goodwill and intangible assets, reflecting the challenges faced in the current market environment. This compares to $263 million in the same quarter of 2023.
Market Conditions and Strategic Initiatives
The company continues to navigate a challenging retail environment marked by inflationary pressures and shifting consumer demand. In response, Newell Brands has implemented restructuring initiatives aimed at improving operational efficiency and reducing costs, contributing to an improved gross profit margin despite declining sales.
Overall, Newell Brands is actively working to enhance its financial health and operational effectiveness as it adapts to the evolving consumer landscape.
A Who Owns Newell Brands Inc. (NWL)
Ownership Structure
As of 2024, Newell Brands Inc. (NWL) has a diverse ownership structure primarily comprised of institutional investors, mutual funds, and retail investors. The company has approximately 416 million shares outstanding, net of treasury shares.
Major Shareholders
| Shareholder Type | Ownership Percentage | Number of Shares |
|---|---|---|
| Institutional Investors | 92.5% | 384 million |
| Mutual Funds | 24.8% | 103 million |
| Retail Investors | 7.5% | 32 million |
| Insider Ownership | 0.2% | 0.8 million |
Institutional Ownership Breakdown
The institutional investors hold a significant portion of Newell Brands' shares, with major entities including:
| Institution | Ownership Percentage | Number of Shares |
|---|---|---|
| Vanguard Group | 8.5% | 35.4 million |
| BlackRock Inc. | 7.8% | 32.4 million |
| State Street Corporation | 6.7% | 27.8 million |
| Fidelity Investments | 5.9% | 24.6 million |
| Invesco Ltd. | 4.1% | 17.1 million |
Recent Stock Performance
As of the end of September 2024, Newell Brands' stock performance has shown fluctuations, with a current share price approximately at $3.92. The company has experienced a net loss of $162 million in the nine months ended September 30, 2024, compared to a net loss of $302 million in the same period of 2023.
Equity Structure
Newell Brands has common stock with a par value of $1.00 per share, and the total stockholders' equity stood at approximately $2.86 billion as of September 30, 2024.
Recent Financial Data
| Financial Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Net Sales | $1.947 billion | $2.048 billion |
| Gross Profit | $679 million | $621 million |
| Operating Loss | ($121 million) | ($159 million) |
| Net Loss | ($198 million) | ($218 million) |
| Diluted Loss per Share | ($0.48) | ($0.53) |
Market Capitalization
The market capitalization of Newell Brands Inc. is approximately $1.63 billion as of October 21, 2024.
Debt and Financial Obligations
As of September 30, 2024, Newell Brands reported total liabilities amounting to $8.91 billion, with long-term debt at $4.09 billion.
Newell Brands Inc. (NWL) Mission Statement
Overview of Mission Statement
Newell Brands Inc. aims to enhance the lives of consumers by creating innovative, high-quality products that are essential to everyday life. The company focuses on building brands that resonate with customers and drive sustainable growth.
Core Values
- Innovation: Continuously investing in product development to meet the evolving needs of consumers.
- Quality: Commitment to producing reliable and high-standard products.
- Sustainability: Integrating sustainable practices across operations to minimize environmental impact.
- Customer Focus: Prioritizing customer needs and satisfaction in all business decisions.
Financial Performance and Impact
As of September 30, 2024, Newell Brands reported a net loss of $198 million, compared to a net loss of $218 million in the same quarter of the previous year. This reflects a 9.2% improvement year-over-year.
Key Financial Metrics
| Metric | Q3 2024 | Q3 2023 | Change ($) | Change (%) |
|---|---|---|---|---|
| Net Sales | $1,947 million | $2,048 million | ($101 million) | (4.9%) |
| Gross Profit | $679 million | $621 million | $58 million | 9.3% |
| Operating Loss | ($121 million) | ($159 million) | $38 million | 23.9% |
| Net Loss | ($198 million) | ($218 million) | $20 million | 9.2% |
| Diluted Loss per Share | ($0.48) | ($0.53) | $0.05 | 9.4% |
Business Segments Performance
Newell Brands operates through three primary segments: Home and Commercial Solutions, Learning and Development, and Outdoor and Recreation. The financial performance of these segments as of Q3 2024 is summarized below:
| Segment | Net Sales (Q3 2024) | Net Sales (Q3 2023) | Operating Income (Loss) (Q3 2024) | Operating Income (Loss) (Q3 2023) |
|---|---|---|---|---|
| Home and Commercial Solutions | $1,047 million | $1,123 million | ($94 million) | $64 million |
| Learning and Development | $717 million | $694 million | $75 million | ($127 million) |
| Outdoor and Recreation | $183 million | $231 million | ($23 million) | ($42 million) |
Operational Strategies
The company is currently focusing on several strategic initiatives to enhance operational efficiency and financial performance:
- Project Phoenix: A restructuring initiative aimed at reducing costs and improving operational efficiency.
- Network Optimization: Streamlining distribution and logistics to better serve customer needs.
- Innovation Pipeline: Investing in new product development to drive future sales growth.
Recent Developments
Newell Brands has faced challenges due to soft global demand and distribution losses, particularly in the Home and Commercial Solutions segment. The company continues to adapt its strategies to navigate these market conditions effectively.
How Newell Brands Inc. (NWL) Works
Company Overview
Newell Brands Inc. (NWL) operates through three main segments: Home and Commercial Solutions (H&CS), Learning and Development (L&D), and Outdoor and Recreation (O&R). The company offers a diverse range of consumer and commercial products, including kitchen appliances, writing instruments, and outdoor gear.
Financial Performance
As of September 30, 2024, Newell Brands reported the following financial highlights:
| Financial Metrics | 2024 (Q3) | 2023 (Q3) | Change ($) | Change (%) |
|---|---|---|---|---|
| Net Sales | $1,947 million | $2,048 million | ($101 million) | (4.9%) |
| Gross Profit | $679 million | $621 million | $58 million | 9.3% |
| Gross Margin | 34.9% | 30.3% | — | — |
| Operating Loss | ($121 million) | ($159 million) | $38 million | 23.9% |
| Net Loss | ($198 million) | ($218 million) | $20 million | 9.2% |
| Diluted Loss per Share | ($0.48) | ($0.53) | $0.05 | 9.4% |
Segment Performance
The performance across the three segments for the nine months ended September 30, 2024, is as follows:
| Segment | Net Sales (in millions) | Operating Income (Loss) (in millions) | Operating Margin (%) |
|---|---|---|---|
| Home and Commercial Solutions | $2,902 | ($30) | (1.0%) |
| Learning and Development | $2,089 | $374 | 17.9% |
| Outdoor and Recreation | $642 | ($52) | (8.1%) |
Liquidity and Capital Resources
As of September 30, 2024, Newell Brands had the following liquidity metrics:
| Liquidity Metrics | Amount (in millions) |
|---|---|
| Cash and Cash Equivalents | $494 |
| Accounts Receivable, Net | $931 |
| Inventories | $1,652 |
| Total Current Assets | $3,362 |
| Total Assets | $11,773 |
| Total Liabilities | $8,913 |
Debt and Interest Expense
Newell Brands' interest expense has been impacted by recent downgrades in credit ratings:
- Weighted Average Interest Rate (2024): Approximately 5.8%
- Weighted Average Interest Rate (2023): Approximately 5.1%
- Estimated increase in interest expense due to downgrades: $16 million annually (approximately $12 million in 2024)
Restructuring and Impairment Charges
Newell Brands has recorded significant restructuring and impairment charges:
| Type of Charge | 2024 (in millions) | 2023 (in millions) | Change ($) |
|---|---|---|---|
| Restructuring Costs | $87 | $131 | ($44) |
| Impairment of Goodwill and Intangible Assets | $260 | $271 | ($11) |
Recent Developments
In June 2024, Newell Brands entered into an operating lease agreement for its corporate headquarters with a minimum contractual lease payment of approximately $106 million over 14.5 years.
Market Challenges
The company has faced challenges due to soft global demand, net distribution losses, and product line exits, particularly in the H&CS segment. Changes in foreign currency have also impacted sales negatively.
Future Outlook
Newell Brands continues to assess its cash requirements and available sources to fund its operations amid a rapidly changing retail landscape, focusing on maintaining liquidity and flexibility.
How Newell Brands Inc. (NWL) Makes Money
Revenue Streams
Newell Brands Inc. generates revenue through several key product segments, which include Home and Commercial Solutions, Learning and Development, and Outdoor and Recreation. The following table summarizes the net sales for the three and nine months ended September 30, 2024, compared to the same periods in 2023 (in millions):
| Segment | Three Months Ended September 30, 2024 | Three Months Ended September 30, 2023 | Nine Months Ended September 30, 2024 | Nine Months Ended September 30, 2023 |
|---|---|---|---|---|
| Home and Commercial Solutions | $1,047 | $1,123 | $2,902 | $3,152 |
| Learning and Development | $717 | $694 | $2,089 | $2,071 |
| Outdoor and Recreation | $183 | $231 | $642 | $834 |
| Total Net Sales | $1,947 | $2,048 | $5,633 | $6,057 |
Segment Analysis
The Home and Commercial Solutions segment, which includes brands like Rubbermaid and Mr. Coffee, reported a decline in net sales due to soft global demand and product line exits. For the three months ended September 30, 2024, net sales fell to $1,047 million from $1,123 million in the prior year, reflecting a decrease of 6.8%.
The Learning and Development segment, which features products from brands like Elmer's and Sharpie, saw a slight increase in net sales, rising to $717 million from $694 million, an increase of 3.3% year-over-year. This growth was driven by improved orders in the Baby business, which partially offset declines in the Writing business.
In contrast, the Outdoor and Recreation segment experienced a significant decline, with net sales decreasing from $231 million in 2023 to $183 million in 2024, a drop of 20.8%. This was attributed to reduced demand and distribution losses.
Operating Performance
Operating income for the three months ended September 30, 2024, was a loss of $121 million, improved from a loss of $159 million in the same period of 2023. The operating loss was impacted by a non-cash impairment charge of $260 million related to goodwill and intangible assets.
| Operating Income (Loss) (in millions) | Three Months Ended September 30, 2024 | Three Months Ended September 30, 2023 |
|---|---|---|
| Home and Commercial Solutions | ($94) | $64 |
| Learning and Development | $75 | ($127) |
| Outdoor and Recreation | ($23) | ($42) |
| Total Operating Income (Loss) | ($121) | ($159) |
Cost Structure
The cost of products sold for the three months ended September 30, 2024, was $1,268 million, compared to $1,427 million in the prior year. This resulted in a gross profit of $679 million, representing a gross margin of 34.9%, compared to 30.3% in the prior year. The increase in gross margin was attributed to productivity improvements and lower restructuring-related charges.
Geographical Breakdown
Net sales by geography for the three months ended September 30, 2024, are as follows (in millions):
| Geography | North America | International | Total |
|---|---|---|---|
| Home and Commercial Solutions | $691 | $356 | $1,047 |
| Learning and Development | $531 | $186 | $717 |
| Outdoor and Recreation | $97 | $86 | $183 |
| Total Net Sales | $1,319 | $628 | $1,947 |
Financial Position
As of September 30, 2024, Newell Brands had total assets of $11,773 million, with total liabilities of $8,913 million. This results in stockholders' equity of $2,860 million. Cash and cash equivalents stood at $494 million, a significant increase from $332 million at the end of December 2023.
Newell Brands' debt situation is also notable, with long-term debt amounting to $4,092 million, down from $4,575 million at the end of 2023. The company has faced increased interest expenses, with net interest expense reaching $223 million for the nine months ended September 30, 2024.
Conclusion on Profitability
Newell Brands' profitability has been challenged by soft demand, restructuring costs, and impairment charges. For the nine months ended September 30, 2024, the company reported a net loss of $162 million, compared to a net loss of $302 million in the same period of 2023, reflecting an improvement in operational efficiency despite ongoing market challenges.
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Article updated on 8 Nov 2024
Resources:
- Newell Brands Inc. (NWL) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Newell Brands Inc. (NWL)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Newell Brands Inc. (NWL)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.