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Drought Hurts Lawn Care Sales07-12-07 | News

Drought Hurts Lawn Care Sales




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How will the drought continue to affect lawn care product sales? Some predict profits will be below expectations this year.


As the Southeastern U.S. has had its driest spring on record, the warm weather in May has helped U.S. retail sales in general snap back from a weak April but it has hurt sales of grass seed, weed killers and insecticides at some suppliers.

Central Garden & Pet Co., the second-largest U.S. lawn and garden- supply company, warned that ?EUR??,,????'?????<

Two-thirds of the Central Garden?EUR??,,????'?????<

“What happened is the retailers sold through the inventory they had in the stores and we’ve not seen the reorders we thought we’d see,” said Chief Executive for Central Garden & Pet, Glenn Novotny at an investor conference.

Novotny referred to the fact that many communities in the Southeast have water restrictions. “When you can’t water your lawns… and you can’t plant things very well, it’s very tough on grass seed as well as our insect controls, and we don’t know how much of that (business) we’re going to get back.”

As a response to Central Garden?EUR??,,????'?????<

“While Central’s products really only correlate with a small portion of Scotts’ business (perhaps 10% or so), we believe its weakness may be indicative of an overall challenging lawn and garden environment, at least partially attributable to dry weather,” analyst Sam Darkatsh said in a note to clients.

It’s unclear whether watering restrictions have made it harder for retailers to catch up on lost sales of lawn-care products, or to offset them with sales of sprinklers and irrigation systems, he added.

Source: CNN Money.com.

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