Newell Brands said it expects President Donald Trump’s trade war to cost it $US100 million every year.
That could mean more expensive Crock-Pots, Coleman stoves, and Sharpie markers.
The warning came on the company’s earnings call Monday, where it also cut its guidance for the fourth straight quarter.
Shares of Newell Brands – the company behind iconic names like Crock-Pot, Rubbermaid, Yankee Candle, and Sharpie – fell as much as 15% Monday after the company warned it expects to feel a $US100 million impact from President Trump’s quickly escalating trade war.
“As the tariffs currently stand, the annualized impact on Newell Brands could be as much as $US100 million,” Michael Polk, the company’s chief executive, told investors on an earnings call following Newell’s second-quarter earnings report.
Despite beating Wall Street estimates for the second quarter – earning $US0.82 where analysts had expected $US0.78 – Newell missed on expected revenues by about 2.7% and also cut it’s guidance for the fourth time this year.
When pressed for specifics on which brands or products would be affected most by tariffs from Europe and China, Polk said it was too early to tell.
“I think it’s too early to know exactly how much of the pricing will land but we’re not going to hesitate to take the price up,” he said.
An inventory shift at office-supply chains like Office Depot and Staples should also help to mitigate the potential drawbacks of a trade war. Sharpie and other writing products, more of which are now being sold online instead of distributed through big box chains, are some of Newell’s highest-margin items, Polk said. Other hits include outdoor brands like Marmot and Coleman.