Orlando, FL 7/10/12 (StreetBeat) -- Personal care product maker Helen of Troy Ltd. (Nasdaq: HELE) said Tuesday that is fiscal first-quarter profit fell 4.6 percent, as the effects of unfavorable exchange rates and higher costs more than offset a sales increase.
The profit fell short of Wall Street expectations and the El Paso, Texas-based company also cut its full-year profit forecast, sending its shares down more than 10 percent in premarket trading.
The company, which makes Revlon, Vidal Sassoon hair products and other personal care and housewares items, earned $23.5 million, or 74 cents per share, for the quarter ended May 31. That compared with $24.6 million, or 78 cents per share, in the same quarter last year.
Analysts, on average, expected a profit of 86 cents per share, according to FactSet.
Sales rose 11 percent to $300.2 million, from $271.5 million last year. Sales of housewares jumped 14 percent to $60.2 million on strong demand for OXO kitchen products, while personal care sales fell 4.2 percent to $117.6 million as a result of tough retail markets in the U.S., Latin America and Europe, the company said.
Healthcare and home environment sales jumped 28 percent to $122.4 million, mainly as a result of the company's Dec. 30 acquisition of the PUR water filtration business.
Helen of Troy said the effects of unfavorable foreign exchange rates, higher air freight costs at its personal care products business, increased closeout sales at its housewares division and higher general product costs were partially offset by the PUR acquisition, but still resulted in slightly lower profit margins.
Based on the fiscal first-quarter results and expectations that the retail sales environment will continue to be challenging, the company cut its full-year profit guidance to a range of $3.70 to $3.80 per share from its previous prediction of $3.80 to $3.90 per share.
Wall Street was expecting a fiscal year profit of $3.90 per share, according to FactSet.
Helen of Troy backed its previous revenue projection of $1.3 billion to $1.33 billion.
In premarket trading, Helen of Troy shares dropped $3.53, or 10.4 percent, to $30.50. The stock closed Monday at $34.03,
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