Ecolab Announces Plan to Buy Back Stock
At Henkel’s request, Ecolab has filed a registration statement with the Securities and Exchange Commission that would enable Henkel to sell all 72.7 million Ecolab shares it holds. Ecolab and Henkel have also agreed to amend the stockholder’s agreement between the parties to facilitate the offering.
Ecolab further announced that it has agreed to purchase $300 million of its shares directly from Henkel in conjunction with Henkel’s sale of Ecolab shares. Ecolab will use existing cash balances, commercial paper and committed bank lines to fund the purchase. The purchase is expected to be accretive to Ecolab’s 2009 earnings per share.
“We have had a productive relationship with Henkel,” said Douglas M. Baker Jr., Ecolab's chairman, president and chief executive officer. “Through it, we expanded our global business reach and developed new and better opportunities to serve our customers. Henkel has been a strong and supportive shareholder, and we wish them well in the future.”
Henkel has held an investment in Ecolab since 1989. The investment originated as part of a transaction in which Ecolab and Henkel formed a joint venture in Europe, combining each company’s European commercial cleaning and sanitizing operations. Also at that time, Henkel sold its remaining worldwide commercial cleaning and sanitizing businesses to Ecolab. In 2001, Ecolab purchased Henkel's interest in the joint venture for cash. In August 2007 Henkel announced its intention to acquire the adhesives and electronic materials businesses of National Starch. In February, Henkel announced its intention to sell some or all of its Ecolab shares. More info: www.ecolab.com
Avon’s Beauty Product Sales Soar 15% in Q3
Avon Products’ profit in the third quarter rose 60% to $222.6 million, boosted by strong foreign sales, demand for new products and a tax benefit. Sales of beauty products rose 15%. The company’s 15% growth in beauty sales included increases in all categories: color was up 19%, fragrance grew 18%, skin care increased 9% and personal care rose 13%.
Active representatives increased 5%. Revenues benefited 7% from pricing and mix, and units sold decreased 1% versus the prior-year quarter, according to the company. Total revenue rose 13% to $2.64 billion, partly because of higher prices and 15% growth in sales of beauty products. More info: www.avon.com
Physicians Formula Posts Small Gain in Third
Physician's Formula's third quarter sales rose 2.5% to $20.3 million. Net income soared from $102,000 to nearly $1.7 million.
“Given the very soft consumer environment, we are pleased with our double-digit net sales growth we have achieved in the first nine months of the year. This growth represents the success of our 2008 new product introductions, as well as 2008 distribution gains,” said Ingrid Jackel, chairwoman and chief executive offier of Physicians Formula.
While the company anticipates the weakened consumer environment to continue well into 2009, “We remain dedicated to providing consumers the new products and formulas that will expand our market share and maintain our philosophy of product innovation,” Ms. Jackel continued. “We are very excited about our new strategic initiatives that form the foundation of our new 2009 line. These initiatives include expansion of Organic wear, innovation in the Mineral Wear and bronzer category, as well as the continued rejuvenation of our eye makeup products.”
Net sales for the first nine months of 2008 rose 10.6% to $85.8 million. Net income rose 21% to $4.7 million. More info: www.physiciansformula.com
Unit Sales Boost Revlon's Third Quarter Results
Revlon reported a 1% increase in third quarter sales to $334.4 million, while posting net income of $29.2 million, vs. a loss of $10.4 million a year ago. However, the gain in profit is attributable to the July sale of Revlon’s Bozzano branded men’s hair care and shaving line of products, which are sold only in Brazil. The purchase price was $107 million.
“We have executed our strategy and profitably grown our business during the first nine months of this year. Specifically, we have launched a comprehensive and successful new lineup of Revlon and Almay color cosmetics products, supported our brands with appropriate levels of advertising and promotional support, increased our margins and improved our capital structure,” said David Kennedy, president and chief executive officer, Revlon.
For the nine months, sales rose nearly 2% to $1.01 billion. According to Mr. Kennedy, Revlon is confident about the new product introductions for the first half of 2009. More info: www.revlon.com