Central Garden & Pet sees 6% increase in first quarter sales

Central Garden & Pet Company reported first quarter net sales of $307.3 million, an increase of 6%, compared with $290.5 million in the first quarter of the prior year.

"We are beginning to see signs of progress from our efforts to improve our business and better utilize our resources," said John Ranelli, president and CEO of Central Garden & Pet. "As a result of these efforts, our operations are becoming more efficient and we are executing better."
First quarter net sales for the pet segment increased $14.7 million, or 8%, from the same period a year ago to $199.3 million, due in large part to higher sales of other manufacturers' products as well as higher flea and tick and professional revenues. Sales of other manufacturers' products increased primarily due to higher dog food and treat sales. Professional revenues benefited from a shift in timing of sales. The pet segment's branded product sales were $146.7 million in the first quarter of 2015 and sales of other manufacturers' products were $52.6 million.
The pet segment's operating income was $20.6 million compared with $14.4 million in the first quarter of 2014. The $6.2 million increase in operating income was largely due to increased sales and improved gross margins. The Pet segment's operating margin increased 250 basis points, benefitting predominately from higher gross margins across most of the pet categories. The professional and flea and tick businesses were the largest contributors to the operating margin increase, reflecting a shift in mix toward higher-margin products. The pet nutrition and aquatics businesses experienced lower profitability during the quarter.
Overall, the company’s gross margin of 28.6% increased 120 basis points compared to the prior year as a result of strength in the pet segment. The company's first quarter operating income was $1.1 million, compared with an operating loss of $8.4 million in the first quarter of 2014, an improvement of $9.5 million. Operating margin of 0.4% rose 320 basis points from the prior year period. Increased profitability in the pet and garden segments contributed to the operating income and operating margin improvement. The net loss for the quarter was $5.7 million, or $0.12 per fully diluted share, compared to a net loss of $12.7 million, or $0.26 per fully diluted share in the year-ago period.

How do Americans plan to treat their pets this Valentine’s Day?

Old Mother Hubbard survey finds 42% of Americans will buy their dogs a special treat

Old Mother Hubbard has conducted a survey of 600 US pet owners to see how they planned to spend Valentine’s Day with their pets.


The survey found that 57% of pet parents said it was a deal breaker if their significant other or potential significant other didn’t like pets. Forty-two percent of Americans will buy their dogs a special treat this Valentine’s Day and another 11% will prepare a special meal for their furry friend.
Other survey findings include:


• 26% of all pet parents say that their pet gets jealous when they show affection to their significant other
• 54% of American pet owners tell their pets “I Love You” on a daily basis
• 1 in 10 American pet parents have used a photo of their pet in an online dating profile

To celebrate Valentine’s Day with their pets:


• 21% will invest in new toys  
• 18% will show their pooch some extra attention  
• 6% will invest in some chic new clothing
• 4% will take their pets to the groomer

UK pet care spending to surpass US$7 billion in 2015

Total spending on pet care in the UK is set to reach a record high of US$7.16 billion (£4.6 billion) in 2015, a 3% increase on 2014’s US$6.92 billion and a growth of 25% since 2010, according to reports.
Of the near-US$7 billion spent in 2014, UK consumers allocated US$5.57 billion to petfood and US$1.5 billion to non-food items such as grooming, day care, clothes and toys—expenses that speak to the ongoing trend of pet humanization. “Pet owners are increasingly treating their cats, dogs and even small mammals like members of their family,” said Gina Westbrook, director of strategy briefings at Euromonitor, during an interview with The Telegraph. “The opportunity to commercialize this trend into a vast range of goods and services—from dog beer to cat counseling, from pet weddings to 'social petworking'—is staggering for the company that can position itself to gain credibility among this growing demographic.”
According to Westbrook, there are three kinds of pet owners: mainstream humanizers, who account for roughly two-thirds of pet owners and opt for reliable premium pet brands; anti-humanizers, who make up 20%–30% of pet owners and choose smaller, ethical brands over the large corporations (and are also more likely to put their pets on wild, raw or organic diets); and extreme humanizers, who make up 5% of pet owners and tend to see their pet as an accessory or child substitute, spending money on designer outfits, exercise activities and extreme grooming treatments.
There are a number of reasons for this humanization, said Westbrook. "On the one hand, people are single and increasingly lonely, living in more 'dehumanized' societies," she said. "On the other hand, there is also the DINKS: Double Income No Kids. Couples delay marriage and the first child so pets are often the choice for their love and affection. In many emerging markets splashing on pets is a way to flaunt status and also a reflection of westernization."
Two-thirds of animal owners see their pets as beloved family members, according to Euromonitor data, and the humanization trend is expected to continue for the foreseeable future.