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Rubbermaid bounces back
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April 22, 1998: 2:26 p.m. ET
Earnings beat Street despite weak Curver line, restructuring charge
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NEW YORK (CNNfn) - Household products maker Rubbermaid Inc. said Wednesday that its aggressive corporate streamlining program allowed it to post 8.6 percent earnings growth for the first quarter of 1998, surpassing forecasts from both the company and Wall Street.
Before one-time restructuring charges, the company earned $37.2 million, or 25 cents per share, up from $34.0 million, or 22 cents per share, a year earlier.
Revenue surged to $649.7 billion from $601.7 billion.
The results surpassed both Wall Street expectations of 24 cents per share and the company's own January warning that earnings might drop as low as 21 cents per share.
After a $28.2 million charge for a corporate streamlining program announced in January, the company earned $9 million, or 9 cents per share, in the period.
Investors welcomed the news, with Rubbermaid stock (RBD) up 7/16 at 28-11/16 in midday trading on the New York Stock Exchange.
When it announced the restructuring, Rubbermaid estimated the program, which included far-reaching job cuts and increased reliance on automation, would cost a total of $200 million by the year 2000.
"This improvement in operating profitability marks the point in our turnaround where we begin to reap the benefits of our cost-cutting and service initiatives," said Wolfgang R. Schmitt, Rubbermaid's chairman and CEO.
Schmitt also said Rubbermaid would significantly increase its advertising budget to promote consumer awareness of its brands, which include Rubbermaid and Curver home products, Little Tikes toys and Graco infant products.
The company said its acquisition of Curver was "slightly dilutive," but the other units, particularly Little Tikes, had "achieved strong volume increases" and "steady market-share gains." 
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Rubbermaid
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