Fortune Brands Profit Jumps 63 Percent

Fortune Brands Inc. (FO), whose products range from Moen faucets to Titleist golf balls and Jim Beam bourbon (search),Friday said fourth-quarter jumped 63 percent on strong overall sales.

The company, whose stock rose 4 percent, said net income jumped to $249.5 million, or $1.68 a share, from $156.9 million, or $1.04 a share, a year earlier.

Excluding special items, the company earned $1.29 a share, topping analysts' expectations of $1.19 to $1.23 a share, with an average estimate of $1.21, according to Reuters Estimates.

"All four of their businesses are doing well. Their home and hardware department has been picking up market share and the Therma-Tru acquisition has added to sales. They've been putting its fiberglass doors in all of the Lowe's chain, and I'm sure they're going to do it in Home Depot, too," said Alexander Paris, an analyst at Barrington Asset Management.

Quarterly sales rose to $1.91 billion from $1.66 billion.

Fortune Brands, which also makes MasterBrand and KitchenCraft (search) cabinets and MasterLock padlocks, said benefits from Therma-Tru (search) surpassed expectations. It added the nationwide rollout of its doors at Lowe's would be completed in the first quarter.

Favorable demographics helped its home and hardware business, the company said, citing immigration trends, rising household wealth, aging housing stock and low interest rates.

Chief Financial Officer Craig Omtvedt told a conference call that 2005 growth rates were expected to return to "more normalized levels," adding the company aimed to hit its long-term goal of mid- to high-single-digit growth in operating income before charges in home and hardware.

An overhaul of the office products business, which includes Swingline staplers and Day-Timer personal organizers, also bore fruit, helped by "strong white-collar employment in the U.S. (which helped) growth in home offices and economic improvement in international markets," Omtvedt said.

"There was a really impressive performance in office, (which) had a very good quarter on the margin line," said Eric Bosshard, an analyst at Midwest Research.

Fortune said its spirits and wine business had strong volume growth in the United States, Australia and the United Kingdom.

Fourth-quarter golf operating income fell to $2.1 million from $4.4 million, hurt by the winding down of some products in advance of new launches.

Overall, the bottom line was boosted by $58.5 million, or 40 cents per share, in tax-related credits from a U.S. Internal Revenue Service review of the company's tax returns from 1997 through 2001. The company also expects to receive a $56 million tax refund in the first quarter.

The company expects to achieve its long-term goal of earnings per share growth before items in the first quarter and fulll year.

Shares of Fortune Brands rose $3.05 to $78.85 on the New York Stock Exchange (search).