Consumer products maker Newell Rubbermaid said on Tuesday that it would exit some product lines and raise prices to offset rapidly rising resin costs and protect profit margins.
The maker of Sharpie markers, Goody hair products and Rubbermaid storage containers also cut its full-year profit outlook.
Newell expects to sell off, cut back or close down about $500 million in sales of selected consumer product categories.
The company had total sales of $6.4 billion in 2007. It said much of the action would be focused on the most resin-intensive product areas.
"In categories where resin is a high percentage of cost of goods sold and the consumer's willingness to pay for innovation is low, the economics are no longer viable," Newell Rubbermaid Chief Executive Mark Ketchum said in a statement.
The company plans to raise prices in the second half of this year, with some increases as high as 22 percent.
Newell's move comes a day after Kimberly-Clark , which makes tissue and diapers, cut its full-year outlook and said rising materials costs might force it to implement more price increases.
Atlanta-based Newell expects restructuring costs of $80 million to $100 million, or $68 million to $85 million aftertax, from the moves, which are expected to be completed within a year.
The company cut its full-year outlook to a range of $1.40 to $1.60 a share, but backed a previous forecast for second quarter earnings in the range of 47 cents to 50 cents a share.
In April, the company had forecast full-year profit of $1.80 to $1.90 a share.
Analysts expected profit of 48 cents a share for the second quarter and $1.76 a share for the full year, according to Reuters Estimates.
Newell Rubbermaid shares, trading at a year low, were off 49 cents, or 3.2 percent, to $14.94 in morning New York Stock Exchange trading. Kimberly-Clark shares fell $5.56, or 9.5 percent, to $52.24.