Nov 1, 2010
Alberto Culver tops Street on strong int'l sales
Nov 1, 2010
NEW YORK, Nov 1 (Reuters) - Hair care products maker Alberto Culver Co (ACV.N), which Unilever is buying for $3.7 billion, reported a higher-than-expected quarterly profit, boosted by strong sales in Latin America and Canada.
The results reinforce the idea that consumer goods company Unilever (UNc.AS) (ULVR.L) is getting some popular brands with room to grow, said Morningstar Inc analyst Lauren DeSanto, while Alberto Culver needed a larger partner to expand those brands.
"If you look back at the reasoning behind the acquisition, it's small company with strong healthy brands," DeSanto said. The two companies announced the deal in September and expect it to close during this quarter.
Alberto Culver said international sales rose by 26.7 percent in the fourth quarter ended on Sept. 30, while U.S. sales were up 3.5 percent as the company sold more of its TRESemme and Nexxus hair care products domestically.
DeSanto noted that marketing had driven much of the sales increase. Advertising and marketing costs rose 9.3 percent for the full year.
Net income at Alberto Culver, which makes Alberto V05 and other brands of shampoos, rose to $41.3 million, or 41 cents a share, from $31.7 million, or 32 cents a share, a year earlier.
Excluding tax benefits resulting from dividend payments, it earned 42 cents a share, beating the analysts' average estimate of 39 cents, according to Thomson Reuters I/B/E/S.
The company, which competes with larger rivals Procter & Gamble Co (PG.N) and L'Oreal SA (OREP.PA), said net sales rose 12.1 percent to $431.9 million, while analysts had expected $429.5 million.
L'Oreal posted better-than-expected quarterly earnings on rebounding luxury brands, while P&G beat expectations by relying on heavy advertising and overseas growth.
Shares of Alberto were up 5 cents at $37.34 on the New York Stock Exchange.
(Reporting by Dhanya Skariachan and Jon Lentz, editing by Gerald E. McCormick and Lisa Von Ahn)
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