High praise for cannabis biz
Along with 17% company-wide sales gains, Scotts MiracleGro reported a massive sales increase in the second quarter in the company’s Hawthorne Gardening Company hydroponics business.
Hawthorne sales were up 245% due to an acquisition of Sunlight Supply Inc. and volume growth in most categories. Hawthorne is a family of brands revolving around sustainable gardening, organic gardening, and hydroponics – the latter is closely associated with what is expected to be a growing business in legal marijuana.
“Clearly, we’re pleased with what we’re seeing,” said CEO Jim Hagedorn, referring to Hawthorne.
“While it's become cool and fashionable to invest in companies that are affiliated in the hands and state authorized cannabis industries, we were the first major player and certainly the first public company to enter the space,” Hagedorn said. “We’ve been bullish on this category from day-one, including a year ago when it felt like the sky was falling.”
The big money he explained, was in commercial accounts, for which Scotts has a dedicated team to build the business. Hagedorn said only about 5% of the company’s hydroponics products are sold to people growing plants to home. The bulk – more than $500 million in products, will be used by commercial growers.
“Large commercial operators in the industry see us as a critical part of their success,” he told investors.
The upbeat nature of the call marks a big shift from last August, when Hawthorne’s performance was below expectations. In this week’s conference call, Hagedorn rolled back his comments about the company’s Hawthorne team being “gun shy.”
“In a moment of frustration last year, I made a comment on one of these calls that the team was gun shy,” Hagedorn said. “They’ve taken great pride and proven me wrong.”
Hagedorn also said: “The results we posted in Q2 and the momentum we’ve seen so far in Q3 is showing once again that this industry has great potential and we are better position than anyone to win."
Hawthorne sales were up 245% due to an acquisition of Sunlight Supply Inc. and volume growth in most categories. Hawthorne is a family of brands revolving around sustainable gardening, organic gardening, and hydroponics – the latter is closely associated with what is expected to be a growing business in legal marijuana.
“Clearly, we’re pleased with what we’re seeing,” said CEO Jim Hagedorn, referring to Hawthorne.
“While it's become cool and fashionable to invest in companies that are affiliated in the hands and state authorized cannabis industries, we were the first major player and certainly the first public company to enter the space,” Hagedorn said. “We’ve been bullish on this category from day-one, including a year ago when it felt like the sky was falling.”
The big money he explained, was in commercial accounts, for which Scotts has a dedicated team to build the business. Hagedorn said only about 5% of the company’s hydroponics products are sold to people growing plants to home. The bulk – more than $500 million in products, will be used by commercial growers.
“Large commercial operators in the industry see us as a critical part of their success,” he told investors.
The upbeat nature of the call marks a big shift from last August, when Hawthorne’s performance was below expectations. In this week’s conference call, Hagedorn rolled back his comments about the company’s Hawthorne team being “gun shy.”
“In a moment of frustration last year, I made a comment on one of these calls that the team was gun shy,” Hagedorn said. “They’ve taken great pride and proven me wrong.”
Hagedorn also said: “The results we posted in Q2 and the momentum we’ve seen so far in Q3 is showing once again that this industry has great potential and we are better position than anyone to win."