WD-40 Company (NASDAQ: WDFC) stock rising over 8.6% on 10th July 2019 (Source: Google finance) after the company posted better than expected results for the third quarter of FY 19 due to increased sales in the Asia-Pacific region and in Europe, Middle East, and Africa. The company has reported a 12% growth in the net profit to $18.1 million.
WDFC in the third quarter of FY 19 has reported the adjusted earnings per share of $1.30, beating the analysts’ estimates for the adjusted earnings per share of $1.26, as per Analysts polled by FactSet. The company had reported the adjusted revenue growth of 7 percent to $114 million in the third quarter of FY 19, beating the analysts’ estimates for revenue of $109.4 million. The translation of the Company’s foreign subsidiary results to U.S. dollars had an unfavorable impact on sales for the current quarter and year-to-date. On a constant currency basis, total net sales would have been $117.5 million for the third quarter and $324.6 million year to date.
Moreover, the net sales in the Americas remained constant in the third quarter primarily due to lower sales of maintenance products in Latin America and Canada, which decreased 16 and 18 percent, respectively, compared to the prior year fiscal period. The significant decline in sales was because in the comparable period last year customers were buying high volumes of product in advance of our planned price increases. Net sales in EMEA rose 13% in the third quarter primarily due to higher sales of WD-40 Multi-Use Product due toa higher level of promotional activities and increased distribution of WD-40 EZ-REACH Flexible product. Net sales in Asia-Pacific rose 14% in the third quarter mainly due to a 66 percent increase in sales of WD-40 Multi-Use Product in the Asia distributor markets. The significant rise in sales was because, in the comparable period of last year, sales in the Asia distributer markets were negatively impacted by the transitioning of three distributor partners in the region.
For FY 19, the company expects net sales to be between $425 million and $437 million, net income is expected to be between $63.3 million and $64.4 million and diluted earnings per share is expected to be between $4.58 and $4.65. The gross margin percentage for the full year is expected to be about 55 percent and advertising and promotion investments are projected to be between 5.5 and 6.0 percent of net sales.