TARRYTOWN, N.Y. — The booming 2012-2013 cough-cold season may not have come with a fresh set of challenges for the 2013-2014 season. Retailers who had to beef up their cold and flu remedy supplies in the latter half of the season may not need to order as heavily over the summer as they may have in the past. A late start to the allergy season also is reducing the need for cough-cold stock.
"Last quarter … was a very strong cough-cold season, probably the strongest in the last 10 years," Matthew Mannelly, Prestige Brands CEO and president, told analysts Thursday morning. Because of the heavy orders in this past quarter, summertime orders and potentially orders for the second half of the cough-cold season next year may not be as robust, Mannelly cautioned.
"Because of the heavy cough-cold, what you typically have in most seasons is retailers winding down their cough-cold purchases in late February, early March," Mannelly explained. "They didn't do that because of the strong cough-cold season this year. So we had solid growth throughout the quarter, but that means they're going to wind down their purchases in April of this year instead of March, which means you're actually going to see a deceleration in the first quarter."
Another challenge heading into next season will be the return of several venerable cough-cold brands to the shelf. "[The challenge will be] to manage pediatrics and cough-cold in the marketplace in light of the returning brands and the … heavy investments that we believe those returning brands will make," Mannelly said.