Little to Annoy at Helen of Troy

It's tough to judge beauty from the headlines. Take, for instance, this week's talk about Helen of Troy (Nasdaq: HELE). Never heard of her? Sure you have. You just don't think you have. She's the maven of Brut, Vitalis, Final Net, and other products. And like the ancient Greek Helen, this one weaves a tangled web of intrigue, producing items that are sold under trademarks licensed from sometime competitors such as Procter & Gamble (NYSE: PG), Schering-Plough (NYSE: SGP), and Revlon (NYSE: REV).

To get back to this week's story, Helen's latest earnings report trumpets record revenues and operating income, while some news channels reported an earnings fall. Which one is correct? That depends on how you like your earnings: with items or without.

To my mind, the first-quarter numbers reflect a pretty face. Revenues rose 17% to $107 million. But what's that blemish? Net earnings dropped from $0.50 to $0.44? Peering closer, we see that last year's results were juiced by proceeds from a legal settlement, while this year's are hindered by a loss from discontinued operations. Plucking those few stray whiskers leaves us with $0.45 this quarter, a nice 20% bump from last year.

Though gross margins were trimmed by 0.6%, penny-pinching in SG&A yielded a 0.4% improvement in operating margins. There was also a sizeable 16% reduction in inventory.

Turning to the future, management reiterated guidance for a near-40% gain in full-year earnings to around $2.65 per share. A firm in such a boring-looking industry, sporting a trailing P/E of 19, might look fully valued, but investor admiration for Helen's beauteous execution has allowed it to out-strut the S&P 500 for the past year. It's even out-prettied outstanding Avon Products (NYSE: AVP).

For more on Helen of Troy and beauty:

• Some Fools thought Helen was a hottie before the rest of the boys noticed.
• Lately, Revlon could use a little pancake and low light.
• Meanwhile, Avon looks like a classic beauty.

Fool contributor Seth Jayson used to own a hair dryer, but sadly, he no longer has the need. He has no position in any company mentioned. View his Fool profile here.