Finances

WD-40 Company (WDFC) announced its third quarter earnings on Monday, July 10. The manufacturer of household and multi-use products reported increased sales and revenue, causing its shares to rise nearly 5% after the release of the report.

The company's net sales for the third quarter totaled $141.7 million. This was up 15% from sales of $123.7 million during the same quarter last year and above analysts' estimates of $138.4 million.

"I am happy to share with you that after two quarters of flat-to-down sales, we have returned to solid top line growth in the third fiscal quarter," said WD-40 Company CEO, Steve Brass. "The impacts of changing foreign currency exchange rates have had a significant negative impact on our reported results in both the third quarter and year to date. On a constant currency basis, global sales were up 18% in the third quarter and 7% year to date. Achieving year to date growth of 7% in constant currency is in-line with our long-term objectives."

WD-40 reported net income of $18.9 million or $1.38 per adjusted share for the quarter. This is a 30% increase from earnings during the same quarter last year of $14.5 million or $1.07 per adjusted share.

WD-40's Americas segment net sales increased by 16% reaching $71.1 million for the quarter. This increase was attributed to higher sales of maintenance products in the U.S. The Europe, Middle East, Africa and India segment reported an increase in sales of 6% in the third quarter to $52.5 million. Sales in the Asia-Pacific segment rose by 42% to $18.1 million due to an increase in sales of maintenance products in the Asia-Pacific distributor markets and China. WD-40 Company's board of directors declared a quarterly dividend of $0.83 per share payable on July 31, 2023 to stockholders of record at the close of business on July 14, 2023.

WD-40 Company (WDFC) shares ended the week at $224.86, up 19% for the week.

PriceSmart Reports Quarterly Earnings

PriceSmart Inc. (PSMT) announced its third quarter earnings on Monday, July 10. Despite meeting analysts' revenue forecast, the company's shares dropped more than 6% following the release of the report.

Revenue for PriceSmart's third quarter increased to $1.10 billion. This is up 6.4% from $1.03 billion in revenue at this time last year and was in line with analysts' expectations.

"Congratulations for a job well done during the third quarter," said PriceSmart's CEO, Robert Price. "Our year-over-year increased sales performance was supported by significant strengthening of the Costa Rica currency, the Colon, along with the strong opening of our new location in San Miguel, El Salvador by improvements in buying and operations and by growth in online sales. After operating in the region for 26 years, we have the experience and skills required to successfully operate the club business in the region to U.S. standards, but we are often faced with country-specific events that result in risk to our financial results. We continue to address these risk factors with improved risk prevention systems, along with meeting with government officials as needed."

PriceSmart reported a net income of $29.57 million or $0.94 per adjusted share. This is up from a net income of $19.26 million or $0.62 per adjusted share in the same quarter last year.

The San Diego-based company that owns and operates U.S.-style membership warehouse clubs in Latin America and the Caribbean reported an increase in merchandise sales across several segments. The company's Central America segment sales increased 11.8%, while the Caribbean segment sales increased 7.3%. The Colombia segment saw a decrease of 15.7%, which was attributed to the significant devaluation of the Colombian currency. Membership accounts grew 2.2% to 1.79 million with Platinum membership accounts reaching 8.6% of the total membership base. PriceSmart opened its newest warehouse club this quarter, bringing the total number of clubs in operation to 51, with two anticipated openings in 2023 in Colombia and Guatemala.

PriceSmart Inc. (PSMT) shares ended the week at $76.09, relatively unchanged for the week.

Helen of Troy Posts Earnings

Helen of Troy Limited (HELE) reported its first quarter earnings on Monday, July 10. After reporting better-than-expected fiscal first quarter earnings and revenue, the company's shares rose 16% following the release of the report.

Helen of Troy reported sales of $474.7 million in the first quarter. This was down 6.6% from $508.1 million reported at this time last year, but above analysts' expectations of $465.4 million.

"I am pleased to report that first quarter financial performance exceeded our expectations despite continued pressure on certain categories from lower consumer demand and shifting buying patterns," said Helen of Troy's CEO, Julien R. Mininberg. "As expected, we significantly improved our gross profit margin and expanded adjusted operating margin during the quarter. I am very pleased with how well our organization is executing, not only on Pegasus, but also across the many other initiatives underway to drive results this fiscal year and over the long term."

Helen of Troy posted net income of $22.6 million or $0.94 per adjusted share. This was down 4.8% from net income of $24.6 million or $1.02 per adjusted share at this time last year.

The parent company of brands such as Hydro Flask, Vicks, Braun and Honeywell reported a 7.3% decrease in their Home & Outdoor revenue to $217.1 million. The company also saw a 5.9% decrease in their Beauty & Wellness segment to $257.5 million. The company attributed the decrease in revenues to a 7.2% decline in its Organic business for the Home & Outdoor segment and an 8.1% decrease for its Beauty & Wellness segment. This decline was primarily driven by a decrease in sales in the insulated beverage category, lower houseware sales due to a reduction in club channel programs and the impact of the Bed, Bath & Beyond bankruptcy. The reduction in revenue was partially offset by a rise in online channel sales and stronger consumer demand for travel-related products in the outdoor category. For fiscal 2024 annual outlook, the company expects net sales to be in the range of $1.97 billion to $2.02 billion.

Helen of Troy Limited (HELE) shares ended the week at $128.38, down 2% for the week.

The Dow started the week of 7/10 at 33,706 and closed at 34,509 on 7/14. The S&P 500 started the week at 4,394 and closed at 4,505. The NASDAQ started the week at 13,645 and closed at 14,114.

U.S. Treasury Yields fell at the start of the week as investors awaited the latest commentary from Federal Reserve officials on key inflation data. Yields continued to fall at the end of the week as investors digested the newest U.S. wholesale inflation report.

On Wednesday, the U.S. Department of Labor announced that the consumer price index (CPI), which measures the cost of dozens of everyday consumer goods, rose 0.2% in June, slightly below economists' forecast of 0.3%. The CPI year-over-year rose 3.0% following 4.0% in May and marked the smallest annual increase since March 2021.

"There has been significant progress made on the inflation front, and today's report confirmed that while most of the country is dealing with hotter temperatures outside, inflation is finally cooling," said chief investment officer at Key Private Bank, George Mateyo. "The Fed will embrace this report as validation that their policies are having the desired effect – inflation has fallen while growth has not yet stalled."

The benchmark 10-year Treasury note yield opened the week of July 10 at 4.07% and traded as low as 3.76% on Thursday. The 30-year Treasury bond opened the week at 4.05% and traded as low as 3.89% on Thursday.

On Thursday, the U.S. Department of Labor reported that initial claims for unemployment fell by 12,000 to 237,000 for the week ending July 8. This was well below analysts' expectations of 250,000. Continuing unemployment claims fell 11,000 to 1.73 million.

The Federal Reserve's "Beige Book" report stated, "Labor demand remained healthy, though some contacts reported that hiring was getting more targeted and selective. Employers continued to have difficulty finding workers, particularly in health care, transportation, and hospitality, and for high-skilled positions in general."

The 10-year Treasury note yield finished the week of 7/10 at 3.83%, while the 30-year Treasury note yield finished the week at 3.93%.

Freddie Mac released its latest Primary Mortgage Market Survey on Thursday, July 13. Mortgage rates increased for both the 30-year and 15-year fixed rates for the third consecutive week.

This week, the 30-year fixed rate mortgage averaged 6.96%, up from last week's average of 6.81%. Last year at this time, the 30-year fixed rate mortgage averaged 5.51%.

The 15-year fixed rate mortgage averaged 6.30% this week, up from 6.24% last week. During the same week last year, the 15-year fixed rate mortgage averaged 4.67%.

"Mortgage rates increased to their highest level since November 2022, the last time rates broke 7%," said Freddie Mac's Chief Economist, Sam Khater. "Incoming data suggest that inflation is softening, falling to its lowest annual rate in more than two years. However, increases in housing costs, which account for a large share of inflation, remain stubbornly high, mainly due to low inventory relative to demand."

Based on published national averages, the savings rate was 0.42% as of 6/20. The one-year CD averaged 1.63%.

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