COLUMBUS, Ohio (COLUMBUS BUSINESS FIRST)–After racking up yet another record sales year and beating all of its five-year goals, Scotts Miracle-Gro Co. is planning for the next five years toward a transformed business, possibly double in size.

CEO Jim Hagedorn also floated the idea of spinning out its fast-growing cannabis and hydroponics supply division as its own company – but said in a Wednesday call with investors there are no immediate plans to do so. Likewise, he said he has no plans to leave, but Scotts has an eye on succession planning.

The Marysville company remains fixed on long-term horizons to strengthen the business and widen its lead over competitors, instead of short-term quarterly financials, Hagedorn said. Scotts (NYSE: SMG) posted a loss in the fourth quarter that ended Sept. 30, although it is $4.9 billion in full-year sales was an all-time high, topping last year’s record.

“There are a lot of great things happening at the company right now,” Hagedorn said. “We want smart growth, not growth simply for the sake of it.”

He outlined five main themes for the next five years across its two main divisions:

For the larger consumer gardening business, which has steady growth and lower margins: Attracting and keeping customers from younger generations becoming first-time homebuyers, expanding direct-to-consumer sales such as its AeroGrow indoor growing kits, and emphasizing its line of live plants alongside more traditional supplies such as tools and fertilizer.

For Hawthorne Gardening Supply, the indoor cultivation supplier: Strengthen innovation in plant science and technology to become an industry thought leader, and become a “courageous and first mover” to take advantage of the evolving cannabis industry in the U.S.

Nearing $10 billion is attainable if both divisions deliver on their potential, he said. For example, the last five-year plan projected flat to 2% annual growth in the consumer business, now the company expects a 2% to 4% clip.

Hagedorn expressed particular pride in his son, Chris Hagedorn, Scotts executive vice president and Hawthorne president. If Hawthorne were to spin out, the CEO said, “He’s ready to run things. He’s maybe better than I am.”

An example of growth prospects is Hawthorne’s $150 million loan in August to Toronto-based RIV Capital, which invests in U.S. cannabis businesses. The structure segregates the cash from Scotts to ensure none goes to companies that actually handle the plants, which the U.S. federal government still considers illegal.

But now Scotts has a foundation in place should that legal status change, Hagedorn said. In the coming years, that might mean RIV has to draw down more capital before there are returns.

“If you are a short-term investor (in Scotts), you might not like it – and that’s fine,” Hagedorn said.

For financial details on the quarter and year, click here.

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