MoreNet income for the nine months ended May 31, 2002 was $16.1 million, or $1.01 per share compared to $10.5 million, or $0.68 per share the nine months last year, a 49% increase.
Net sales for the third quarter ended May 31, 2002 were $51.5 million, an increase of 28% over the prior year quarter. Sales for the current year to date were reported at $151 million, an increase of 40% over the same period last year.
Results reported reflect the application of the consensus reached by the Emerging Issue Task Force of the FASB in Issue 01-09 (EITF 01-09): "Accounting for Consideration Given by a Vendor to a Customer or a Reseller of the Vendor's Products." The change requires a re-classification of certain marketing and promotional expenses from operating expenses to a reduction in sales. The change has no effect on net income. Prior period financial statements have been reclassified to comply with this guidance.
The change reduced both net sales and advertising and sales promotion expense during the quarter ended May 31, 2002 by $5.4 million and by $2.4 million during the third quarter last year. Through nine months ended May 31, 2002 and 2001, the reclassification reduced net sales and advertising and sales promotion expense by $15 million and $5.1 million, respectively.
"We are proud of the efforts our people have made to execute our long-term plan of diversification across brands, borders and business channels, and because of those efforts, it is more than likely that we will deliver the most profitable year in WD-40 Company's history," said Garry O. Ridge, WD-40 Co. president and chief executive officer. "We are also pleased that our year-to-date earnings before interest, taxes, depreciation, and amortization (EBITDA) are up nearly 36% from last year."
Total invoiced sales (defined as sales excluding the impact of the application of EITF 01-09) for the quarter were 77.4% from the Americas, 16.7% from Europe and 5.9% from Asia/Pacific.
The household products X-14®, Carpet Fresh®, and 2000 Flushes® added $18.5 million to the quarter and $56.6 million year to date. The recently acquired Spot Shot brand, which closed on May 31, 2002, did not add any sales to the quarter.
