Scotts Miracle-Gro Co. Reports Positive Financial Results

By Chris Stiles • Wednesday, January 28 11:55 • Permanent Link

The Scotts Miracle-Gro Company has reported its first quarter results for the period ended December 27, 2025. The company has also made significant announcements regarding divestiture plans for its Hawthorne subsidiary and the initiation of a new multi-year share repurchase program.

In terms of financial performance, the company's U.S. consumer net sales for the quarter were $328.5 million. The GAAP gross margin rate improved by 90 basis points to 25.0%, while the non-GAAP adjusted gross margin rate also improved by 90 basis points to 25.4% compared to the prior year. The GAAP net loss from continuing operations was reported at $0.83 per share, while the non-GAAP adjusted net loss from continuing operations stood at $0.77 per share, representing improvements of $0.32 and $0.11 per share, respectively, over the prior year.

Furthermore, the non-GAAP adjusted EBITDA for the quarter was $3.0 million, marking an improvement of $2.1 million over the prior year. The net leverage also improved to 4.03x, showing a reduction of 0.49x compared to the previous year.

The company's divestiture plans involve the sale of its Hawthorne subsidiary to Vireo Growth, Inc. The proposed transaction will see Vireo acquiring Hawthorne in exchange for an investment in Vireo, integrating the cultivation supply business into its broader consumer cannabis operations. The closing of the transaction is anticipated to occur in the fiscal second quarter.

In addition, The Scotts Miracle-Gro Company announced a new share repurchase program authorizing the repurchase of up to $500 million of its common stock. The program is set to commence in late 2026, aligning with the company’s capital allocation strategy. The timing and number of shares repurchased will depend upon ongoing progress in deleveraging, market conditions, and other factors as determined by management.

Looking ahead, the company has reaffirmed its fiscal 2026 guidance, which includes expectations of low single-digit growth in U.S. consumer net sales, non-GAAP adjusted gross margin of at least 32%, non-GAAP adjusted net income per share from continuing operations of $4.15 to $4.35, mid single-digit growth in non-GAAP adjusted EBITDA, and free cash flow of $275 million, driving the leverage ratio down to the high 3's.

Following these announcements, the company's shares moved -0.78%, and are now trading at a price of $63.61. For more information, read the company's full 8-K submission here.

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