Earnings Double at Dial

Dial Corp., Scottsdale, AZ, said Thursday that earnings more than doubled in the second quarter, helped by strong sales in the U.S. and improvement in its Argentine market. The improved results are the latest sign that the maker of Dial soap, Renuzit air fresheners, Purex laundry detergent, and Armour Star canned meats has turned itself around under chairman and chief executive Herbert Baum.

Since Mr. Baum took over two years ago, the company has exited unprofitable businesses and eliminated practices like booking most of its sales at the end of the quarter to meet financial goals, which loaded up retailers with inventory. The results also come almost a year after Dial’s board of directors decided to seek a buyer for the company, saying it is difficult for a company of Dial’s size to compete alone against giants like Procter & Gamble Co. and Unilever Plc. But the company has yet to find a buyer that would be interested in all of Dial’s diverse businesses.

Dial posted profit of $33.4 million, or 35 cents a share, including $2.2 million in after-tax gains from the sale of a plant and other factors. That compares with $14.7 million, or 16 cents a share, a year ago. Analysts forecast earnings of 32 cents for the quarter, according to market research firm Thomson First Call. The company said in June it expected to beat what was then the average analyst estimate of 25 cents by at least 7 cents on the strong U.S. sales, favorable costs and better-than-expected business in Argentina.

Dial also said it expects full-year earnings from continuing operations of $1.19 per share. Analysts forecast earnings of $1.15 to $1.19 a share, with an average of $1.18, according to First Call.

Sales rose 5.6 percent to $333.3 million. Excluding Argentina, which has been hurt by the currency devaluation in that country, sales would have been up 8 percent, the company said.

Sales in the company’s four core U.S. businesses rose 8.9 percent, lead by a 21 percent gain in laundry care, which was helped by the introduction of Purex After The Rain fragrance, and a 22 percent gain in air-freshener sales.

International sales fell 20.6 percent, weighed down by Argentina, though unit volume in that country, which factors out currency and pricing changes, rose 10.2 percent.