American consumers pulled back in June but lower wage growth in China is helping margins, Jarden'sexecutive chairman, Martin Franklin, told CNBC’s “Squawk on the Street” on Tuesday. Jarden is a diversified consumer products company the sells brands like Mr. Coffee, Coleman and Rawlings.
“For the overall consumer, you’re going into an election year so who knows what is going to happen,” Martin said about the outlook for spending.
But he still thinks the overall U.S. consumer is relatively healthy compared with consumers in Europe and other parts of the world.
“Is it the same level of growth we saw in the first half?” he asked. “Maybe not. But it’s not bad.” (Related: US Economy Going from Bad to Worse).
Jarden on Tuesday reported second-quarter earnings of $1.14 per share compared with 89 cents per share in the same quarter a year earlier. Organic net sales grew 3.7 percent while reported net sales came in at $3.17 billion versus $3.17 a year earlier.
Although Jarden is seeing a pullback in consumer spending, it is getting help from lower labor costs in China. After an 18 to 20 percent sequential rise in wage inflation last year, “that momentum seems to have come to a halt,” Franklin said. He attributed the weaker wage growth to higher unemployment and China’s economic slowdown.
“That has helped our margins,” Martin added. “At the moment commodity costs have held relatively stable, shipping costs have held relatively stable and wage inflation is more modest, so overall that helps.”
Questions? Comments? Email us at firstname.lastname@example.org.