Lifted by Hydro Flask, sales at Helen of Troy’s Housewares segment jumped by 28.5 percent to $183.2 million in the fiscal third quarter ended on Nov. 30. The better-than-expected results led the group to lift its guidance for the year.
The Houseware division’s operating income soared by 41.7 percent to $42.3 million to represent 23.1 percent of the segment’s sales, compared with 20.9 percent for the year-ago quarter. This was driven by higher sales from both OXO and Hydro Flask, thanks to strong demand from existing domestic brick-and-mortar customers, an increase in online sales, an increase in international sales, higher club sales and new products.
The management noted that Hydro Flask continued to add significant incremental market share, with the brand being the number one most searched-for brand on Amazon in October. In particular, Hydro Flask’s eco-friendly vacuum insulated bottles, its accessories and its soft cooler packs continue to grow in popularity.
During the quarter, Hydro Flask’s growth was based broadly domestically and internationally across all channels and key retailers including online, active lifestyle, specialty outdoor and natural foods. New distribution accounted for about 25 percent of the total Housewares segment growth in the quarter. Hydro Flask also grew at other retailers and channels where point-of-sale exceeded the category average growth rate and new outlets and shelf space were added, particularly in the eastern U.S. In addition, some retailers accelerated orders of Hydro Flask to support holiday demand.
Overall, Helen of Troy’s revenues rose by 10.1 percent to $474.7 million, while the gross margin expanded by 2.0 percentage points to 44.2 percent thanks to strong high-margin housewares revenues and a better product mix within the segment. Net income jumped by 39.0 percent to $68.7 million. The group raised its full-year guidance and now expects revenues of $1,650 to $1,675 million, including a growth of 19 to 21 percent from the Housewares segment, up from prior guidance of 13 to 15 percent.
The management said that beyond the current fiscal year, Hydro Flask has multiple key growth drivers, including new product introductions, expansion into new categories as the brand expands beyond the bottle, and additional distribution gains, not only in the U.S. but also internationally, where the management said the brand has scope for further penetration. The company said it would continue to make incremental marketing investments to build digital content on OXO and Hydro Flask products.