Currency pressure and the ongoing housing slump battered Fortune Brands' bottom line as the liquor, hardware and sporting-goods conglomerate posted a better-than-90% drop in first-quarter profit Friday.
Before the start of trading, Fortune said it earned just $7.4 million, or 5 cents a share, in the period -- down from $120.5 million, or 70 cents a share, in the same quarter a year ago. On an adjusted basis, the Deerfield, Ill.-based company said it would have earned 30 cents a share.
Sales fell 20% to $1.4 billion from $1.8 billion last year. Spirits sales were off 3%; golf equipment fell 5%; and home and hardware sales plummeted 30%.
The average estimate of analysts polled by FactSet Research had been for the company to earn 23 cents a share on revenue of $1.38 billion.
The company attributed the profit skid to lower sales, a stronger dollar and charges for supply-chain initiatives, among other factors.
"Against the headwinds of the global recession, the severe U.S. housing downturn and reduced consumer discretionary spending, each of Fortune Brands' businesses performed at or above our expectations in the first quarter," said Bruce Carbonari, chief executive, in the earnings report.
He added that the spirits business experienced stable consumer demand and higher pricing but that was mostly offset by soft results internationally.
Looking ahead, Fortune said it expects to earn $2 to $2.50 a share for all of 2009, bracketing a current Wall Street view of $2.24 a share.
Shares of Fortune closed Thursday at $39.31, up marginally.
