This is a partial transcript from Your World with Neil Cavuto, June 28, 2002, that was edited for clarity. Click here for complete access to all of Neil Cavuto's CEO interviews.
Watch Your World w/Cavuto weekdays at 4 p.m. and 1 a.m. ET.
NEIL CAVUTO, HOST: If you're planning to do some work in your home or out in the yard this weekend, you're not alone. According to Barron's, consumers have been spending lots of cash on everything home related, creating a multibillion-dollar nesting industry. So, how long will this trend last?
JIM HAGEDORN, CEO, SCOTTS COMPANY: How you doing?
CAVUTO: So, things are going OK.
HAGEDORN: Things are great. The lawn business is up 17 percent and our biggest customers, our Miracle-Gro business.
CAVUTO: Year over year.
HAGEDORN: Yes, 13 percent. Our herbicide business round-up 18 percent, potting soils, 26 percent.
CAVUTO: What is going on here?
HAGEDORN: Nesting is not over and we've had great weather and people want to take care of their lawn and their garden.
CAVUTO: Yes, but we have this drought going on, right?
HAGEDORN: Our biggest increases are in the areas where the drought is supposedly the worst. But, you know, most of it is a deficit from last year. The rain so far this year sort of for the spring season has been pretty normal. So, people's yards and gardens look pretty good.
CAVUTO: So, in some areas where people can't water their lawns or there are restrictions on that, doesn't that hurt you or no?
HAGEDORN: No, our business looks really good. People want to fix, you know, their stressed out yard and garden. And so they buy some of our products to help their yard.
CAVUTO: Do you have products that don't need as much watering so -- because that is a big issue, certainly in the northeast, the Midwest, what have you.
HAGEDORN: One of the things we're working on is called a supergrass, which is part through conventional breeding and part through biotechnology, because if you ask people what do you not like about your yard, it is weeding, mowing and watering.
So we are developing grasses that you can weed with just one application. Through genetic engineering, they grow at about a third as fast and last using conventional breeding, using some southwestern grasses, grasses that are very drought tolerant.
CAVUTO: Let me ask you a little bit about this cocooning factor. You were mentioned as a favorite play of this nesting trend going on. But there are a lot of analysts I talk to, you know, and they say it is getting long in the tooth. Is it?
HAGEDORN: Well, you know, products like ours where, for $10, you can apply it to your lawn, you get a great looking lawn. And you tell me where you can get a bigger bang and sort of add value to your home with sort of less, less sort out of pocket expense. So, you know, we think we are fairly, you know, tolerant to sort of all kinds of economic conditions.
So the answer is no. I was with the CEO of Proctor and asked him, because I knew what was coming on, what do you think. And he said we're not seeing it either.
CAVUTO: Yes. When you talk about the market drought that's been going on and your stock has been, as we were just showing there, very resilient by and large to this phenomenon, there is this paper wealth issue. And it's been moaned again and again, but I'm tempted to ask it, that people will feel a little poor on paper and be less inclined to buy, you know, seed and lawncare products because they are feeling more bummed out. Do you find that?
HAGEDORN: No. I think the last thing they are going to do is let their yard and their home start to look, you know, not so good. So I think that's the last thing they will stop spending on.
CAVUTO: Yes. What about the situation with the dollar? Had a big effect on you as it weakens some more?
HAGEDORN: No. It is actually good because the money that's sent home from our European business, about $500 million of our business is overseas.
CAVUTO: You get more dollars back?
HAGEDORN: Yes. That is a good thing. More money to Ohio.
CAVUTO: You are a good viewer of the markets in general. I know you keep one eye on that strong stock of yours. You getting worried? You know, we've had five, six straight weeks of the downed market here and people saying it could go on a while, we could be looking at a third straight down year.
HAGEDORN: Yes, I am worried about it. I mean, just as a shareholder, my family and I own about 13 million shares of Scotts. So, yes, we worry...
CAVUTO: You must be going ka-ching, huh?
HAGEDORN: We worry about the stock. You know, if we do the right thing, drive our business, you know, care about our brands and account properly, I think, you know, our shareholders are showing confidence in us.
CAVUTO: All right. Jim, thank you very much. Good seeing you again. Jim Hagedorn is the Scotts Company CEO. This nesting craze, it is a big deal now.
Content and Programming Copyright 2002 Fox News Network, Inc. ALL RIGHTS RESERVED. Transcription Copyright 2002 eMediaMillWorks, Inc. (f/k/a Federal Document Clearing House, Inc.), which takes sole responsibility for the accuracy of the transcription. ALL RIGHTS RESERVED. No license is granted to the user of this material except for the user's personal or internal use and, in such case, only one copy may be printed, nor shall user use any material for commercial purposes or in any fashion that may infringe upon Fox News Network, Inc.'s and eMediaMillWorks, Inc.'s copyrights or other proprietary rights or interests in the material. This is not a legal transcript for purposes of litigation.