The Scotts Miracle-Gro Company (SMG), the Ohio-based gardening giant, announced its financial results for the full year and fourth quarter ended Sept. 30, 2024, showcasing a mixed bag of performance. While the company experienced strong growth in its core business, its subsidiary for cannabis growers, Hawthorne Gardening Company, continued to struggle.
Core Business Flourishes
Despite the challenges in the cannabis market, Scotts Miracle-Gro reported positive news in its core gardening segment. “Fiscal 2024 was a strong transition year for the Company in which we continued to transform the business while achieving meaningful top-and bottom-line growth in our core business,” stated Matt Garth, the company’s CFO and chief administrative officer. “We made strategic investments in marketing and innovation to drive sales and support the long-term health of our brands powered by additional efficiency gains across our organization.” This strategic focus resulted in an 11% increase in total company net sales to $414.7 million for the fourth quarter, compared to $374.5 million in the same quarter last year. The U.S. consumer segment sales soared by 54% year-over-year to $309.7 million.
Hawthorne Segment Continues to Struggle
However, the Hawthorne Gardening Company, which serves the cannabis cultivation market, continued to see declining sales. Net sales for Hawthorne plummeted 46% year-over-year to $80.5 million in the fourth quarter of fiscal 2024. This trend, previously reported in the third quarter, is attributed to the discontinuation of Hawthorne’s third-party distributed brands business. This significant decline in Hawthorne sales underscores the challenges faced by the cannabis industry, particularly in light of ongoing regulatory uncertainties and evolving market dynamics.
Financial Highlights
For the full fiscal year 2024, total net sales for Scotts Miracle-Gro remained relatively flat compared to the prior year, coming in at $3.6 billion. The U.S. Consumer segment sales increased 6% year-over-year to $3 billion, driven by factors like increased shelf space, new product listings, and promotional efforts, primarily in the gardens and controls businesses. Meanwhile, sales for the Hawthorne segment declined 37% year-over-year to $294.7 million, largely due to the discontinuation of its third-party distribution business.
Despite the Hawthorne segment’s challenges, Scotts Miracle-Gro demonstrated resilience in its core business, emphasizing its commitment to long-term growth through strategic investments and operational efficiency. As the company navigates the complexities of the cannabis market, its focus on its core gardening segment appears to be paying off. This suggests a path forward for Scotts Miracle-Gro, with potential for continued success in the future.
