Central Garden & Pet Company
NasdaqGS:CENT
$ 43.87
+ $0.23 (0.53%)
$ 43.87
+ $0.23 (0.53%)
End-of-day quote: 02/29/2024

Central Garden & Pet Stock

About Central Garden & Pet

Central Garden & Pet Company (Central) produces and distributes branded and private label products for the lawn and garden, and pet supplies markets in the United States. Central Garden & Pet share price history

Segments

The company operates through two segments, Pet and Garden.

Pet segment

This segment includes dog and cat supplies, such as dog treats and chews, toys, pet beds and containment, grooming products, waste management and training pads; supplies for aquatics, small animals, reptiles and pet birds, including toys, cages and habitats, bedding, food and supplements; products for equine and livestock, animal and household health and insect control products; live fish and small animals, as well as outdoor cushions. These products are sold under brands, such as Aqueon, Cadet, Comfort Zone, Farnam, Four Paws, K&H Pet Products (K&H), Kaytee, Nylabone and Zilla.

The company is one of the leading producers and marketers of branded pet supplies in the United States. It also produces numerous private label brands. In addition, the company's Pet segment operates one of the largest sales and distribution networks in the industry, strategically supporting its brands. Central Garden & Pet share price history

Branded Pet Products

The company's principal pet supplies categories are dog and cat supplies, dog treats and chews; aquatics and reptile supplies, small animal and pet bird supplies, animal health products, as well as live fish and small animals. The company's Nylabone brand is one of the leading brands in dog toys and treats, Kaytee in pet birds and small animal, Farnam in equine, Aqueon in aquatics and Comfort Zone in cat calming. In addition, the company operates its Arden Companies outdoor cushion business in the Pet segment due to synergies in sourcing, manufacturing and innovation with its pet bed business.

The company continuously seeks to introduce new products, both as complementary extensions of existing product lines and in new product categories. In fiscal 2023, the company's Nylabone brand launched a new collection of play toys for imaginative fun, as well as four new product lines that include a variety of chew toys and chew treats. These releases feature chew toy shapes inspired by everyday objects with a fun twist; multi-flavored Basted Blast chew toys; the Sneaky Snacker chew & treat toy; and Healthy Edibles Meaty Center chew treats. And the company's Cadet brand introduced a unique line of all-natural, highly palatable, and digestible long-lasting chews called Bully Hide. In fiscal 2022, the company launched Nylabone Gourmet Style chew toys, which are uniquely crafted with enticing gourmet treats, and an exciting combination of flavor bits roasted throughout.

The company's dog and cat category, featuring brands, such as Cadet, Four Paws, Healthy Edibles, K&H, Mikki, Nylabone, Nubz, NutriDent among others, is an industry leader in manufacturing and marketing premium edible and non-edible chews, interactive toys, grooming supplies and pet beds, pet containment, training and waste management solutions.

Small Animal and Bird Supplies: The company is a leading manufacturer of supplies and pet food for small animals, pet birds and wild birds. It offers a full range of products, including species specific diets, treats, habitats, bedding, hay and toys under brands, such as Kaytee, Critter Trail, C&S Products, and Field+Forest by Kaytee. Many of the company's branded wild bird mixes are treated with a proprietary blend of vitamins and minerals. The company's brands are some of the most widely recognized and trusted brands for birds and small animals.

Animal Health (Health & Wellness, Equine and Professional): The company supplies calming products under the Comfort Zone brand, and flea and tick controls under the Adams brand. It also offers innovative products for horses in the fly control, supplements, grooming, deworming, wound care, leather care and rodenticides categories. The company's portfolio of brands for equine includes Farnam, Horse Health Products, Vita Flex, Just One Bite and Rodentex. These brands, along with sub-brands, including Bronco, Endure, IverCare, Horseshoer's Secret, Red Cell, Sand Clear, Super Mask II and Vetrolin position the company as a leader in these categories. Moreover, the company is a leading supplier of insect control products sold into various markets. The company is the only domestic provider of (S)-Methoprene, which is an active ingredient used to control mosquitoes, flies, fleas, beetles and ants in many professional and consumer insect control applications. The company's products are sold primarily under the Starbar and Zoëcon family of brands, as well as standalone brands, such as Altosid, Centynal, ClariFly IGR, Diacon, Essentria and Extinguish. The company also sells (S)-Methoprene to manufacturers of other insect control products, including Frontline Plus.

Aquatics and Reptile Supplies: The company is a leading supplier of aquariums and terrariums, as well as related fixtures and stands, water conditioners and supplements, water pumps and filters, sophisticated lighting systems and accessories featuring the brands Aqueon, Blagdon, Coralife, Interpet and Zilla.

Live Fish and Small Animals: Segrest and SunPet are leading wholesalers of aquarium fish and plants, reptiles and small animals to pet specialty and mass merchandiser stores, as well as public aquariums and research institutions.

Outdoor Cushions: The company sells Arden-branded outdoor cushions through major retailers, both in-store and online, and private label outdoor cushions through the largest big box stores in North America, all leveraging Arden's EverTru-branded outdoor fabric. The company's OceanTex fabrics, developed by EverTru, are responsibly made and composed of up to 100% recycled materials, including reclaimed ocean plastic and fishing nets.

Pet Sales and Distribution Network

The company's domestic sales and distribution network exists to promote both its proprietary brands and third-party brands. It provides value-added service to over 9,800 retailers, many of which are independent specialty stores with fewer than 10 locations, and over 6,400 veterinary offices. This includes acquisition and maintenance of premium shelf placement, prompt product replenishment, customization of retailer programs, quick response to changing customer and retailer preferences, rapid deployment and feedback for new products and immediate exposure for acquired brands. The combination of brands in the network that are supplied in single shipments enables the company's independent customers to work with it on a cost-effective basis to meet their pet supplies requirements. The company also operates a sales and logistics facility in the United Kingdom.

Pet Sales and Marketing

The company's sales strategy is multi-tiered and designed to capture maximum market share with retailers. Its customers include retailers, such as club, regional and national specialty pet stores, independent pet retailers, food, drug and mass stores, as well as the eCommerce channel. The company also serves the professional market with insect control and health and wellness products for use by veterinarians, municipalities, farmers and equine product suppliers. Costco Wholesale accounted for approximately 13% of the company's Pet segment's net sales in fiscal 2023. Walmart, Petco, Amazon and Kroger are also significant customers.

To optimize the company's product placement and visibility in retail stores, its focused sales resources are segmented as follows:

A sales organization operating by category and channel;

Dedicated account teams servicing its largest customers;

A group of account managers focused on regional chains;

A geographic based group of territory managers dedicated to the independent retailer; and

A specialized group of account managers dedicated to the professional and equine markets.

These sales teams deliver the company's marketing strategy that is consumer, brand and channel driven. The company provides value creation with a focus on innovation, product quality and performance, premium packaging, product positioning and consumer value. The company collaborates closely with its customers to identify their needs, jointly develop strategies to meet those needs and deliver programs that include digital execution, print, broadcast and direct mail. The company continues to invest in talent, innovation, brand building, digital capabilities and eCommerce as these play a critical role in its ambition to lead in the pet segment.

Pet Competition

The company's largest competitors in the product categories it participates in are Mars, Inc.; Spectrum Brands; and the J.M. Smucker Co. The company's Pet segment's sales and distribution network competes with Animal Supply Co., Phillips Pet Food & Supplies and a number of smaller local and regional distributors, with competition based on product selection, price, value-added services and personal relationships.

Garden segment

This segment includes lawn and garden consumables, such as grass seed; vegetable, flower and herb packet seed; wild bird feed, bird houses and other birding accessories; weed, grass, and other herbicides, insecticide and pesticide products; fertilizers and live plants. These products are sold under brands, such as Amdro, Ferry-Morse, Pennington and Sevin.

The company is a leader in the consumer lawn and garden consumables market in the United States and offer both premium and value-oriented branded products. The company also produces numerous private label brands. In addition, the company's Garden segment operates a manufacturing, sales and distribution network that strategically supports its brands with select national retailers.

Branded Lawn and Garden Products

The company's principal lawn and garden consumables product lines are grass seed, wild bird products, lawn and garden care products, including fertilizers, insect control products, live plants and packet seed. The company's Pennington brand is one of the largest in grass seed, wild bird feed and birding accessories. Ferry-Morse is a leader in vegetable, herb and flower packet seed, and the company's Amdro brand is a leading portfolio of control products.

The company continuously seeks to introduce new products, both as complementary extensions of existing product lines and in new product categories. In fiscal 2023, the company's Ferry-Morse brand introduced more than 40 different Plantlings Garden Starter Kits, curated bundles of Plantlings that complement each other and take the guesswork out of planning and buying. In fiscal 2022, the company launched Pennington Smart Patch lawn products, ideal for patching bare lawn spots and thinning areas.

Grass Seed: The company is a leading marketer, producer and distributor of numerous varieties and mixtures of cool and warm season grass seed for both the residential and professional markets, as well as forage and wildlife seed mixtures. The company sells these products under the Pennington brand along with several sub-brands, including Lawn Booster, One Step Complete, Rackmaster, Slopemaster, Smart Seed, Smart Patch, The Rebels and other brand names. The company also produces numerous private label brands of grass seed. The Pennington grass seed manufacturing facilities are some of the largest and most modern seed coating and conditioning facilities in the industry.

Wild Bird: The company operates as a producer, marketer and distributor of wild bird feed, bird feeders, bird houses and other birding accessories. These products are sold under the Pennington, 3-D Pet Products and Wild Delight brands. Many of the company's branded wild bird feed mixes are treated with a proprietary blend of vitamins and minerals. For example, the company's Pennington brand feed mixes are enriched with Bird-Kote, its exclusive process which literally seals each seed with a nutritious coating containing vitamins and minerals that are beneficial to the health of wild birds.

Fertilizer and Controls: The company is a producer, marketer and distributor of soil supplements and stimulants. It manufactures several lines of lawn and garden fertilizers and soil supplements in granular and liquid form under the Alaska Fish Fertilizer, Ironite, Pennington, Pro Care and Superthrive brand names and other private and controlled labels. The company also produces, markets and distributes lawn and garden weed, moss, insect and pest control products. The company sells these products under brands, such as Amdro, Corry's, Daconil, IMAGE, Knockout, Lilly Miller, Moss Out, Over-N-Out, Rootboost and Sevin, as well as other private and controlled labels.

Live Plants: With Bell Nursery and Hopewell Nursery, the company is the primary supplier of superior quality flowers, trees, shrubs and other plants to Home Depot in the Northeast and mid-Atlantic regions, producing and shipping tens of millions of annuals and perennials each year, also offering items the company does not grow, such as orchids and indoor plants.

Packet Seed: The company is a leading provider of vegetable, herb and flower packet seeds and seed starters. The company sells these products under the American Seed, Ferry-Morse, Jiffy, Livingston, McKenzie Seed and other brand names.

Garden Sales and Distribution Network

The company's sales and distribution network exists primarily to promote its proprietary brands and provides it with key access to select national retail chains for its branded products, acquisition and maintenance of premium shelf placement, prompt product replenishment, customization of retailer programs, quick responses to changing customer and retailer preferences, rapid deployment and feedback for new products, market intelligence and potential acquisition targets. The network also sells other manufacturers' brands of lawn and garden supplies and combines these products with the company's branded products into single shipments enabling select national retail chains to deal with it on a cost-effective basis to meet their lawn and garden supplies requirements.

Garden Sales and Marketing

The marketing strategy for the company's premium products is focused on meeting consumer needs through product performance, innovation, quality, upscale packaging and retail shelf placement. The marketing strategy for the company's value products is focused on promotion of the quality and efficacy of its value brands at a lower cost relative to premium brands. The company's customers include retailers, such as home improvement centers, food, drug and mass merchants, and professional end users. Sales to Home Depot represented approximately 35% sales to Walmart represented approximately 24% and sales to Lowe's represented approximately 14% of the company's Garden segment's net sales in fiscal 2023 (for the fiscal year ended September 30, 2023).

To maximize its product placement and visibility in retail stores, the company markets its products through the following four complementary strategies:

Dedicated sales forces represent its combined brand groups;

A retail sales and logistics network, which provides in-store training and merchandising for its customers, especially during the prime spring and summer seasons;

Dedicated account-managers and sales teams located near several of its largest customers; and

Selected independent distributors who sell its brands.

The company continues to invest in talent, digital capabilities and eCommerce as these play a critical role in its ambition to lead in the Garden segment.

Garden Competition

The company's turf and forage grass seed products, fertilizers, pesticides and combination products compete principally against products marketed by The Scotts Miracle-Gro Company. In addition, Spectrum Brands and S.C. Johnson & Son, Inc. are strong competitors in yard and household insecticides.

Seasonality

While demand for the company's pet supplies products, except for pest controls, is generally balanced over the year, the company's lawn and garden consumables business is highly seasonal with approximately two-thirds of net sales occurring in its second and third fiscal quarters (year ended September 30, 2023) combined. The company builds inventory based on expected demand and typically fill customer orders within a few days of receipt, so the backlog of unfilled orders is not material. Funding for working capital items, including inventory and receivables, is normally sourced from operating cash flows and short-term borrowings under its revolving credit facility.

Strategy

The company's Central to Home strategy reinforces its unique purpose to nurture happy and healthy homes and its ambition to lead the future of the pet and garden industries.

The key elements of the company's strategy are to build and grow brands that consumers love; win with winning customers and channels; and fortify the central portfolio.

Regulatory Considerations

The pesticides in the company's products, which are also used on foods, are evaluated by the United States Environmental Protection Agency (EPA) as part of this non-dietary exposure risk assessment.

History

Central Garden & Pet Company was founded in 1955. The company was incorporated in Delaware in 1992.

Country
Founded:
1955
IPO Date:
07/15/1992
ISIN Number:
I_US1535271068

Contact Details

Address:
1340 Treat Boulevard, Suite 600, Walnut Creek, California, 94597, United States
Phone Number
925 948 4000

Key Executives

CEO:
Springer, Mary
CFO
Lahanas, Nicholas
COO:
Data Unavailable