Newell Rubbermaid sees early success

Strong sales in writing, baby categories under new business strategy.

Newell Rubbermaid is still in the beginning stages of a new business plan that focuses resources and attention on its products with the most potential for growth. But executives at the Sandy Springs company said Friday early growth in some categories is indicative of a good year ahead.

Regardless of the economic environment — which Newell Rubbermaid president and CEO Michael Polk said is “certainly better than it was a year ago” — the company must work hard to innovate and create products shoppers do not consider nonessential.

“It’s only discretionary if we let it be discretionary,” he said.

The company is putting more resources into fast-growing categories like its writing businesses, including Sharpie markers and Paper Mate pens, while some brands like Calphalon cookware won’t receive the same level of investment.

Sales of Newell Rubbermaid’s baby categories have improved more than 21 percent over the first three months of last year. In part, better-than-expected 2012 sales in that category and others came because the company is upgrading its ordering systems in Europe, and delivered goods early in order to ease into the new system in the business’ second quarter.

Still, Newell Rubbermaid said it expected to do well for the year, increasing its core sales between 2 and 3 percent, the same level it predicted at the end of 2011. Its end goal, Polk said, is to operate less like a holding company.

In a research note, SunTrust Robinson Humphrey analyst Bill Chappell said he was pleased by the baby and parenting growth, and expects Newell Rubbermaid to be at the higher end of its predicted sales growth range, even as it reinvests most of its money into the business as it continues to transition.

The company made $79.3 million in the first three months of the year, a 4.8 percent increase over the $75.7 million it made for the same period a year ago.