Newell Brands’ Outdoor & Recreation division saw sales fall in the fourth quarter on macroeconomic trends as retailers clear overstock and consumer spending tightens.

Newell Brands operates businesses across the food, home fragrance, commercial, baby, home appliances, and outdoor spaces.

The company’s Outdoor & Recreation division’s net sales totaled $211 million, down from $304 million in the prior year quarter.

The division includes Marmot, Coleman, Campingaz, Contigo, ExOfficio, Bubba, Stearns, and Aerobed.

“Despite taking proactive and decisive actions strengthening the company’s performance, we expect the external landscape to remain challenging in 2023,” said President Chris Peterson during an earnings call with analysts Friday. “The high level of uncertainty on the macro front has influenced our modeling assumptions.”

Peterson, who was announced on Friday as the successor to current CEO Ravi Saligram, said the company expects consumer disposable income will continue to face inflationary pressures, particularly in Europe.

“We also expect consumer demand for general merchandise categories to remain soft due both to the macroeconomic environment and normalization of home and outdoor categories from peak pandemic demand levels,” Peterson said. “Retailers are likely to continue reducing open-to-buy dollars in general merchandise categories.”

He also pointed to continued foreign exchange pressures for the year, while supply chain challenges are expected to continue to ease.

Peterson is expected to remain as president and will add the title of CEO following the company’s annual stockholder meeting May 16.

Turnaround Plan

Newell Brands is in the midst of a restructure, which it announced last month. The plan, called Project Phoenix, includes a 13% cut to office positions with layoffs expected to take place throughout the year.

Project Phoenix also includes the consolidation of manufacturing, some corporate offices, and operating divisions. Operating segments have been reorganized from five to three under the new plan, with Outdoor & Recreation continuing to be its own division headed up by former Timberland Global Brand President Jim Pisani.

The company estimates $220 million to $250 million in pretax savings once the restructure plans are rolled out.

“As macro conditions remain unfavorable to top-line growth, our primary focus in the near term is cash flow and gross margin improvement,” Saligram told analysts on Friday.

Newell Brands Q4, Full Year

Newell Brands reported total fourth-quarter sales of $2.3 billion, down 18.5% from a year ago. The sale of the company’s Connected Home & Security business partially contributed to the sales decrease.

The company swung to a loss of $249 million in the quarter from the $98 million in net income it recorded in the year-ago period.

For full-year 2022, the company’s sales fell 10.7% to $9.5 billion. Net income narrowed from $622 million in the previous year to $197 million.

Newell said it expects revenue for the current year to be in the range of $8.4 billion to $8.6 billion, with earnings per share of $0.95 to $1.08.