WD-40 sees Q1 sales drop

WD-40 Company (WDFC) announced a decline in net sales for its first quarter of fiscal year 2023 ending Nov. 30, 2022.

The San Diego, Calif.-based company reported total net sales for the first fiscal quarter were $124.9 million, a decrease of 7% compared to $134.8 million in the prior year fiscal quarter.

However, Steve Brass, WD-40 chairman and CEO, pointed out some positives in gross margin, “in the first quarter gross margin improved sequentially by 400 basis points compared to the fourth quarter of fiscal year 2022,” said Brass.

WD-40 said net income for the first quarter was $14.0 million, a decrease of 25% from the prior year fiscal quarter.

The company said net sales by segment as a percent of total net sales for the first quarter were as follows: for the Americas, 3%; for EMEA, (29)%; for Asia-Pacific, 25%. 

Net sales in the Americas increased 3% in the first quarter due primarily to higher sales of maintenance products in the U.S., which increased 15% compared to the prior year fiscal quarter.

The Bottom Line: WD-40 Company had net sales decreases of 7% to about $125 million.

What the CEO said: “While we saw topline growth in our Asia-Pacific and Americas segments, our EMEA segment reported sales that were softer than we would like to see. In EMEA, we’ve experienced significant headwinds from fluctuating currency exchange rates, a lower level of customer orders, weaker economic conditions, and a reduction in sales linked to our decision to suspend sales in Russia in 2022,” said Steve Brass, WD-40 chairman and CEO.

Also, in the company earnings call Jan. 9, the CEO indicated that, “suspending sales to Russia has negatively impacted our sales by about 5% million.”

Company info: Click HERE to read the full first fiscal quarter financial report from WD-40 Company.