HOBOKEN, N.J., Feb. 07, 2024 (GLOBE NEWSWIRE) -- Hain Celestial Group (Nasdaq: HAIN), a leading manufacturer of better-for-you brands to inspire healthier living, today reported financial results for the fiscal second quarter ended December 31, 2023.

“We are pleased with the continued progress we are making on key pillars of our Hain Reimagined strategy, generating fuel through working capital management and productivity savings, driving growth through channel expansion and building our organizational capabilities to scale our brands, expand our margins, and transform our business for sustained performance,” said Wendy Davidson, President and Chief Executive Officer. “This progress contributed to results in the second quarter which demonstrate sequential improvement in top- and bottom-line trends.”

Davidson added, “We are positioned to return to overall growth in the back half of the year, despite the challenging macroeconomic environment. Our North America Snacks launch of Garden Veggie™ Flavor Burst™, supported by a robust omnichannel launch plan, is setting up to be the strongest new product launch in recent company history, gaining outstanding acceptance across national and regional retailers and pre-order availability with online partners. Furthermore, we continue to earn incremental distribution across retail, away-from-home and e-commerce channels in our core growth categories of Snacks, Baby & Kids and Beverages. We are making steady progress, advancing towards the reimagination of our business and creation of a sustainable and profitable growth model.”

FINANCIAL HIGHLIGHTS*

Summary of Fiscal Second Quarter Results Compared to the Prior Year Period

  • Net sales were flat year-over year at $454.1 million, an improvement sequentially from the first quarter decrease of 3.3%
    • Organic net sales, defined as net sales adjusted to exclude the impact of acquisitions, divestitures and discontinued brands, increased 0.2% compared to the prior year period, an improvement sequentially from the first quarter decrease of 2.9%. The increase in organic net sales is inclusive of approximately 2.2 percentage points of benefit from foreign exchange.
  • Gross profit margin was 22.5%, a 40-basis point decrease from the prior year period.
    • Adjusted gross profit margin was 23.5%, a 60-basis point increase from the prior year period.
  • Net loss was $13.5 million compared to net income of $11.0 million in the prior year period.
    • Adjusted net income was $10.9 million compared to adjusted net income of $18.3 million in the prior year period.
  • Net loss margin was (3.0%), as compared to net income margin of 2.4% in the prior year period.
    • Adjusted net income margin was 2.4%, as compared to 4.0% in the prior year period.
  • Adjusted EBITDA was $47.1 million compared to $49.8 million in the prior year period; Adjusted EBITDA margin was 10.4%, a 60-basis point decrease compared to the prior year period.
  • Loss per diluted share was $0.15 compared to earnings per diluted share (“EPS”) of $0.12 in the prior year period.
    • Adjusted EPS was $0.12 compared to adjusted EPS of $0.20 in the prior year period.

________________
* This press release includes certain non-GAAP financial measures, which are intended to supplement, not substitute for, comparable GAAP financial measures. Reconciliations of non-GAAP financial measures to GAAP financial measures and other non-GAAP financial calculations are provided in the tables included in this press release.

Cash Flow and Balance Sheet Highlights

  • Net cash provided by operating activities in the second quarter was $20.7 million compared to $2.5 million in the prior year period.
  • Free cash flow in the second quarter was $14.8 million compared to negative free cash flow of $4.4 million in the prior year period.
  • Total debt at the end of the fiscal second quarter was $809.2 million down from $828.7 million at the beginning of the fiscal year.
  • Net debt at the end of the fiscal second quarter was $755.6 million compared to $775.4 million at the beginning of the fiscal year.
  • The company ended the fiscal second quarter with a net secured leverage ratio of 4.2x as calculated under our amended credit agreement as compared to 4.3x at the beginning of the fiscal year.

SEGMENT HIGHLIGHTS

The company operates under two reportable segments: North America and International.

North America

North America net sales in the fiscal second quarter were $267.7 million. This represents a 5.2% decrease compared to the prior year period and a sequential improvement from the 9.8% decrease in the fiscal first quarter. Organic net sales decreased by 4.8% from the prior year period, representing a sequential improvement from the 9.3% decrease in the fiscal first quarter. As expected, the decrease was primarily due to lower sales in baby formula as a result of continued industry-wide challenges in organic formula supply, as well as in Snacks as we shifted our promotional strategy and optimized our channel mix for improved trade efficiency and profitability. This decrease was partially offset by growth in Beverages.

Segment gross profit in the fiscal second quarter was $62.0 million, a decrease of 12.9% from the prior year period. Adjusted gross profit was $66.4 million, a decrease of 6.7% from the prior year period. Gross margin was 23.2%, a 200-basis point decrease from the prior year period, and adjusted gross margin was 24.8%, a 40-basis point decrease from the prior year period. The decrease was driven by deleverage on lower sales volume as well as by inflation, partially offset by pricing and productivity.

Adjusted EBITDA in the fiscal second quarter was $31.2 million, a decrease of 18.9% from the prior year period. The decrease was driven primarily by lower volume, inflation and marketing investments, partially offset by productivity. Adjusted EBITDA margin was 11.7%, a 190-basis point decrease from the prior year period.

International

International net sales in the fiscal second quarter demonstrated continued strength, up 8.5% year-over-year to $186.4 million. This increase reflects 5.8 percentage points of growth from the favorable impact of foreign exchange. The increase was primarily driven by growth in Meal Prep as well as in Beverages.

Segment gross profit in the fiscal second quarter was $40.2 million, a 22.9% increase from the prior year period. Adjusted gross profit was $40.4 million, an increase of 23.3% from the prior year period. Each of gross margin and adjusted gross margin was 21.6%, representing a 250-basis point and 260-basis point increase from the prior year period, respectively. The increase in gross profit was mainly due to pricing partially offset by inflation.

Adjusted EBITDA in the fiscal second quarter was $26.0 million, a 35.0% increase from the prior year period. The increase was driven primarily by pricing, partially offset by lower volumes and inflation. Adjusted EBITDA margin was 13.9%, a 270-basis point improvement from the prior year period.

FISCAL 2024 GUIDANCE**

Lee Boyce, Executive Vice President and Chief Financial Officer, stated, “We are making early progress against Hain Reimagined, especially in the delivery of fuel as planned in this foundational year of the restructure program. We have accelerated some of the initiatives outlined in the Focus Pillar, primarily portfolio and channel mix improvements. This is expected to create near-term revenue headwind as we rationalize lower margin SKUs and sales. As a result, we believe it is prudent to take a more conservative view of the balance of fiscal 2024. In addition, we expect less of a tailwind from foreign exchange than when we initially provided guidance in August. Considering these factors as well as performance year-to-date, we are adjusting our guidance for the full year.”

The company is revising guidance for fiscal 2024 as follows:

  • Organic net sales growth of approximately 1% or more, compared to previous guidance of 2% to 4% growth.
    • This reflects a reduction in the expected foreign exchange tailwind assumed in our fiscal year 2024 guidance provided in August from approximately 2 points to 1 point, assuming continuation of current rates.
  • Adjusted EBITDA between $155 million and $160 million, compared to previous guidance of $155 million to $165 million, aligned to the associated revenue assumptions.
  • Free cashflow of $40 to $45 million, compared to previous guidance of $50 to $55 million, reflecting costs associated with Hain Reimagined.

** The forward-looking non-GAAP financial measures included in this section are not reconciled to the comparable forward-looking GAAP financial measures. The company is not able to reconcile these forward-looking non-GAAP financial measures to their most directly comparable forward-looking GAAP financial measures without unreasonable efforts because the company is unable to predict with a reasonable degree of certainty the type and extent of certain items that would be expected to impact GAAP measures but would not impact the non-GAAP measures. Such items may include certain litigation and related expenses, transaction costs associated with acquisitions and divestitures, productivity and transformation costs, impairments, gains or losses on sales of assets and businesses, foreign exchange movements and other items. The unavailable information could have a significant impact on the company’s GAAP financial results.

Conference Call and Webcast Information

Hain Celestial will host a conference call and webcast today at 8:00 AM EST to discuss its results and business outlook. The live webcast and the accompanying presentation will be available under the Investors section of the company’s corporate website at www.hain.com. Investors and analysts can access the live call by dialing 877-407-9716 or 201-493-6779. Participation by the press and public in the Q&A session will be in listen-only mode. A replay of the call will be available approximately shortly after the conclusion of the live call until Wednesday, February 14, 2024, and can be accessed by dialing 844-512-2921 or 1-412-317-6671 and referencing the conference access ID: 13744015.

About The Hain Celestial Group

Hain Celestial Group is a leading health and wellness company whose purpose is to inspire healthier living for people, communities and the planet through better-for-you brands. For more than 30 years, our portfolio of beloved brands has intentionally focused on delivering nutrition and well-being that positively impacts today and tomorrow. Headquartered in Hoboken, N.J., Hain Celestial’s products across snacks, baby/kids, beverages, meal preparation, and personal care, are marketed and sold in over 75 countries around the world. Our leading brands include Garden Veggie™ snacks, Terra® chips, Garden of Eatin’® snacks, Earth’s Best® and Ella’s Kitchen® baby and kids foods, Celestial Seasonings® teas, Joya® and Natumi® plant-based beverages, Greek Gods® yogurt, Cully & Sully®, Imagine® and New Covent Garden® soups, Yves® and Linda McCartney’s® (under license) meat-free, and Alba Botanica® natural sun care, among others. For more information, visit hain.com and LinkedIn.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve risks, uncertainties and assumptions. If the risks or uncertainties ever materialize or the assumptions prove incorrect, our results may differ materially from those expressed or implied by such forward-looking statements. The words “believe,” “expect,” “anticipate,” “may,” “should,” “plan,” “intend,” “potential,” “will” and similar expressions are intended to identify such forward-looking statements. Forward-looking statements include, among other things: our beliefs or expectations relating to our future performance, results of operations and financial condition; our strategic initiatives (including statements related to Hain Reimagined and our related investments in our business); our business strategy; the impact of foreign exchange on our results; our brand portfolio; product performance; distribution of our products; and current or future macroeconomic trends.

Risks and uncertainties that may cause actual results to differ materially from forward-looking statements include: challenges and uncertainty resulting from the impact of competition; our ability to manage our supply chain effectively; input cost inflation, including with respect to freight and other distribution costs; disruption of operations at our manufacturing facilities; reliance on independent contract manufacturers; changes to consumer preferences; customer concentration; reliance on independent distributors; risks associated with operating internationally; pending and future litigation, including litigation relating to Earth’s Best® baby food products; the reputation of our company and our brands; compliance with our credit agreement; foreign currency exchange risk; the availability of organic ingredients; risks associated with outsourcing arrangements; our ability to execute our cost reduction initiatives and related strategic initiatives; risks associated with conflicts in Eastern Europe and the Middle East and other geopolitical events; our ability to identify and complete acquisitions or divestitures and our level of success in integrating acquisitions; our reliance on independent certification for a number of our products; our ability to use and protect trademarks; general economic conditions; cybersecurity incidents; disruptions to information technology systems; changing rules, public disclosure regulations and stakeholder expectations on ESG-related matters; the impact of climate change; liabilities, claims or regulatory change with respect to environmental matters; potential liability if our products cause illness or physical harm; the highly regulated environment in which we operate; compliance with data privacy laws; our ability to issue preferred stock; the adequacy of our insurance coverage; impairments in the carrying value of goodwill or other intangible assets; and other risks and matters described in our most recent Annual Report on Form 10-K and our other filings from time to time with the U.S. Securities and Exchange Commission.

We undertake no obligation to update forward-looking statements to reflect actual results or changes in assumptions or circumstances, except as required by applicable law.

Non-GAAP Financial Measures

This press release and the accompanying tables include non-GAAP financial measures, including, among others, organic net sales, adjusted operating income and its related margin, adjusted gross profit and its related margin, adjusted net income and its related margin, adjusted earnings per diluted share, adjusted EBITDA and its related margin, free cash flow and net debt. The reconciliations of historic non-GAAP financial measures to the comparable GAAP financial measures are provided in the tables below. These non-GAAP financial measures should not be considered in isolation or as a substitute for the comparable GAAP measures. In addition, these non-GAAP measures may not be the same as similar measures provided by other companies due to potential differences in methods of calculation and items being excluded. They should be read only in connection with the company’s consolidated financial statements presented in accordance with GAAP.

We define our non-GAAP financial measures as follows:

  • Organic net sales: net sales excluding the impact of acquisitions, divestitures and discontinued brands. To adjust organic net sales for the impact of acquisitions, the net sales of an acquired business are excluded from fiscal quarters constituting or falling within the current period and prior period where the applicable fiscal quarter in the prior period did not include the acquired business for the entire quarter. To adjust organic net sales for the impact of divestitures and discontinued brands, the net sales of a divested business or discontinued brand are excluded from all periods.
  • Adjusted gross profit and its related margin: gross profit, before inventory write-downs related to exited categories, plant closure related costs, net and warehouse and manufacturing consolidation and other costs, net.
  • Adjusted operating income and its related margin: operating income (loss) before certain litigation expenses, net, inventory write-downs related to exited categories, plant closure related costs, net, productivity and transformation costs, CEO succession costs, warehouse and manufacturing consolidation and other costs, net, costs associated with acquisitions, divestitures and other transactions, and long-lived asset impairments.
  • Adjusted net income and its related margin and diluted net income per common share, as adjusted: net (loss) income, adjusted to exclude the impact of certain litigation expenses, net, inventory write-downs related to exited categories, plant closure related costs, net, productivity and transformation costs, CEO succession costs, warehouse and manufacturing consolidation and other costs, net, costs associated with acquisitions, divestitures and other transactions, (gains) losses on sales of assets, long-lived asset impairments, unrealized currency losses and the related tax effects of such adjustments.
  • Adjusted EBITDA: net (loss) income before net interest expense, income taxes, depreciation and amortization, equity in net loss of equity-method investees, stock-based compensation, net, unrealized currency (gains) losses, certain litigation and related costs, inventory write-downs related to exited categories, plant closure related costs, net, productivity and transformation costs, CEO succession costs, warehouse and manufacturing consolidation and other costs, costs associated with acquisitions, divestitures and other transactions, (gains) losses on sales of assets, long-lived asset impairments and other adjustments.
  • Free cash flow: net cash provided by or used in operating activities less purchases of property, plant and equipment.
  • Net debt: total debt less cash and cash equivalents.

We believe that the non-GAAP financial measures presented provide useful additional information to investors about current trends in the company’s operations and are useful for period-over-period comparisons of operations. We provide:

  • Organic net sales to demonstrate the growth rate of net sales excluding the impact of acquisitions, divestitures and discontinued brands, and believe organic net sales is useful to investors because it enables them to better understand the growth of our business from period to period.
  • Adjusted results as important supplemental measures of our performance and believe they are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry.
  • Free cash flow as one factor in evaluating the amount of cash available for discretionary investments.
  • Net debt as a useful measure to monitor leverage and evaluate the balance sheet.

Investor Relations Contact:
Alexis Tessier
Investor.Relations@hain.com

Media Contact:
Jen Davis
Jen.Davis@hain.com 

 
THE HAIN CELESTIAL GROUP, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(unaudited and in thousands, except per share amounts)
        
 Second Quarter Second Quarter Year to Date
  2024   2023   2024   2023 
        
Net sales$454,100  $454,208  $879,129  $893,559 
Cost of sales 351,885   350,351   692,971   695,367 
Gross profit 102,215   103,857   186,158   198,192 
Selling, general and administrative expenses 73,952   72,357   151,121   147,308 
Long-lived asset impairment 20,666   340   21,360   340 
Productivity and transformation costs 6,869   986   13,272   1,759 
Amortization of acquired intangible assets 1,509   2,785   3,464   5,573 
Operating (loss) income (781)  27,389   (3,059)  43,212 
Interest and other financing expense, net 16,138   10,812   29,382   18,489 
Other income, net (42)  (1,062)  (307)  (2,852)
(Loss) income before income taxes and equity in net loss of equity-method investees (16,877)  17,639   (32,134)  27,575 
(Benefit) provision for income taxes (4,249)  6,357   (9,628)  8,988 
Equity in net loss of equity-method investees 907   316   1,405   698 
Net (loss) income$(13,535) $10,966  $(23,911) $17,889 
        
Net (loss) income per common share:       
Basic$(0.15) $0.12  $(0.27) $0.20 
Diluted$(0.15) $0.12  $(0.27) $0.20 
        
Shares used in the calculation of net (loss) income per common share:      
Basic 89,811   89,380   89,661   89,343 
Diluted 89,811   89,578   89,661   89,535 
        


THE HAIN CELESTIAL GROUP, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(unaudited and in thousands)
    
 December 31, 2023 June 30, 2023
ASSETS   
Current assets:   
Cash and cash equivalents$53,672  $53,364 
Accounts receivable, net 192,538   160,948 
Inventories 295,276   310,341 
Prepaid expenses and other current assets 57,954   66,378 
Total current assets 599,440   591,031 
Property, plant and equipment, net 273,451   296,325 
Goodwill 939,561   938,640 
Trademarks and other intangible assets, net 295,011   298,105 
Investments and joint ventures 11,411   12,798 
Operating lease right-of-use assets, net 91,388   95,894 
Other assets 23,372   25,846 
Total assets$2,233,634  $2,258,639 
LIABILITIES AND STOCKHOLDERS' EQUITY  
Current liabilities:   
Accounts payable$169,054  $134,780 
Accrued expenses and other current liabilities 90,857   88,520 
Current portion of long-term debt 7,569   7,567 
Total current liabilities 267,480   230,867 
Long-term debt, less current portion 801,675   821,181 
Deferred income taxes 52,900   72,086 
Operating lease liabilities, noncurrent portion 86,022   90,014 
Other noncurrent liabilities 29,736   26,584 
Total liabilities 1,237,813   1,240,732 
Stockholders' equity:   
Common stock 1,118   1,113 
Additional paid-in capital 1,224,667   1,217,549 
Retained earnings 628,650   652,561 
Accumulated other comprehensive loss (130,025)  (126,216)
  1,724,410   1,745,007 
Less: Treasury stock (728,589)  (727,100)
Total stockholders' equity 995,821   1,017,907 
Total liabilities and stockholders' equity$2,233,634  $2,258,639 
    


THE HAIN CELESTIAL GROUP, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(unaudited and in thousands)
        
 Second Quarter Second Quarter Year to Date
  2024   2023   2024   2023 
CASH FLOWS FROM OPERATING ACTIVITIES       
Net (loss) income$(13,535) $10,966  $(23,911) $17,889 
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities       
Depreciation and amortization 11,197   12,155   23,502   24,125 
Deferred income taxes (5,522)  (486)  (16,791)  (1,983)
Equity in net loss of equity-method investees 907   316   1,405   698 
Stock-based compensation, net 3,376   3,435   7,118   7,429 
Long-lived asset impairment 20,666   340   21,360   340 
(Gain) loss on sale of assets -   (3,335)  62   (3,395)
Other non-cash items, net 1,521   (1,048)  965   (2,505)
(Decrease) increase in cash attributable to changes in operating assets and liabilities:       
Accounts receivable (29,497)  3,053   (30,647)  (6,536)
Inventories 22,589   (1,722)  15,166   (18,629)
Other current assets (3,879)  (2,872)  4,882   (331)
Other assets and liabilities 622   2,830   (2,576)  4,178 
Accounts payable and accrued expenses 12,210   (21,168)  34,150   (23,932)
Net cash provided by (used in) operating activities 20,655   2,464   34,685   (2,652)
CASH FLOWS FROM INVESTING ACTIVITIES       
Purchases of property, plant and equipment (5,829)  (6,840)  (12,735)  (14,055)
Investments and joint ventures, net -   242   -   433 
Proceeds from sale of assets 75   7,512   1,332   7,608 
Net cash (used in) provided by investing activities (5,754)  914   (11,403)  (6,014)
CASH FLOWS FROM FINANCING ACTIVITIES       
Borrowings under bank revolving credit facility 76,000   105,000   122,000   185,000 
Repayments under bank revolving credit facility (80,000)  (123,000)  (137,000)  (191,000)
Repayments under term loan (1,875)  (1,875)  (3,750)  (3,750)
Payments of other debt, net (20)  (87)  (3,854)  (159)
Employee shares withheld for taxes (614)  (754)  (1,489)  (983)
Net cash used in financing activities (6,509)  (20,716)  (24,093)  (10,892)
Effect of exchange rate changes on cash 7,000   8,981   1,119   (2,517)
Net increase (decrease) in cash and cash equivalents 15,392   (8,357)  308   (22,075)
Cash and cash equivalents at beginning of period 38,280   51,794   53,364   65,512 
Cash and cash equivalents at end of period$53,672  $43,437  $53,672  $43,437 
        


THE HAIN CELESTIAL GROUP, INC. AND SUBSIDIARIES
Net Sales, Gross Profit and Adjusted EBITDA by Segment
(unaudited and in thousands)
        
 North America International Corporate/Other Hain Consolidated
Net Sales       
Net sales - Q2 FY24$267,671  $186,429  $-  $454,100 
Net sales - Q2 FY23$282,361  $171,847  $-  $454,208 
% change - FY24 net sales vs. FY23 net sales (5.2)%   8.5%     (0.0)% 
        
Gross Profit       
Q2 FY24       
Gross profit$61,982  $40,233  $-  $102,215 
Non-GAAP adjustments(1) 4,431   125   -   4,556 
Adjusted gross profit$66,413  $40,358  $-  $106,771 
% change - FY24 gross profit vs. FY23 gross profit (12.9)%   22.9%     (1.6)% 
% change - FY24 adjusted gross profit vs. FY23 adjusted gross profit (6.7)%   23.3%     2.8% 
Gross margin 23.2%   21.6%     22.5% 
Adjusted gross margin 24.8%   21.6%     23.5% 
        
Q2 FY23       
Gross profit$71,127  $32,730  $-  $103,857 
Non-GAAP adjustments(1) 22   (6)  -   16 
Adjusted gross profit$71,149  $32,724  $-  $103,873 
Gross margin 25.2%   19.0%     22.9% 
Adjusted gross margin 25.2%   19.0%     22.9% 
        
Adjusted EBITDA       
Q2 FY24       
Adjusted EBITDA$31,218  $25,969  $(10,061) $47,126 
% change - FY24 adjusted EBITDA vs. FY23 adjusted EBITDA (18.9)%   35.0%   (26.8)%   (5.4)% 
Adjusted EBITDA margin 11.7%   13.9%     10.4% 
        
Q2 FY23       
Adjusted EBITDA$38,510  $19,242  $(7,935) $49,817 
Adjusted EBITDA margin 13.6%   11.2%     11.0% 
        
(1) See accompanying table "Adjusted Gross Profit, Adjusted Operating Income, Adjusted Net Income and Adjusted EPS"  
        


THE HAIN CELESTIAL GROUP, INC. AND SUBSIDIARIES
Net Sales, Gross Profit and Adjusted EBITDA by Segment
(unaudited and in thousands)
        
 North America International Corporate/Other Hain Consolidated
Net Sales       
Net sales - Q2 FY24 YTD$527,725  $351,404  $-  $879,129 
Net sales - Q2 FY23 YTD$570,757  $322,802  $-  $893,559 
% change - FY24 net sales vs. FY23 net sales (7.5)%   8.9%     (1.6)% 
        
Gross Profit       
Q2 FY24 YTD       
Gross profit$112,878  $73,280  $-  $186,158 
Non-GAAP adjustments(1) 7,751   125   -   7,876 
Adjusted gross profit$120,629  $73,405  $-  $194,034 
% change - FY24 gross profit vs. FY23 gross profit (17.4)%   19.1%     (6.1)% 
% change - FY24 adjusted gross profit vs. FY23 adjusted gross profit (11.8)%   19.3%     (2.1)% 
Gross margin 21.4%   20.9%     21.2% 
Adjusted gross margin 22.9%   20.9%     22.1% 
        
Q2 FY23 YTD       
Gross profit$136,662  $61,530  $-  $198,192 
Non-GAAP adjustments(1) 52   -   -   52 
Adjusted gross profit$136,714  $61,530  $-  $198,244 
Gross margin 23.9%   19.1%     22.2% 
Adjusted gross margin 24.0%   19.1%     22.2% 
        
Adjusted EBITDA       
Q2 FY24 YTD       
Adjusted EBITDA$49,945  $43,407  $(22,136) $71,216 
% change - FY24 adjusted EBITDA vs. FY23 adjusted EBITDA (27.9)%   27.0%   (25.5)%   (17.0)% 
Adjusted EBITDA margin 9.5%   12.4%     8.1% 
        
Q2 FY23 YTD       
Adjusted EBITDA$69,291  $34,189  $(17,634) $85,846 
Adjusted EBITDA margin 12.1%   10.6%     9.6% 
        
(1) See accompanying table "Adjusted Gross Profit, Adjusted Operating Income, Adjusted Net Income and Adjusted EPS"  
        


THE HAIN CELESTIAL GROUP, INC. AND SUBSIDIARIES
Adjusted Gross Profit, Adjusted Operating Income, Adjusted Net Income and Adjusted EPS
(unaudited and in thousands, except per share amounts)
        
Reconciliation of Gross Profit, GAAP to Gross Profit, as Adjusted:       
 Second Quarter Second Quarter Year to Date
  2024   2023   2024   2023 
Gross profit, GAAP 102,215  $103,857  $186,158  $198,192 
Adjustments to Cost of sales:       
Plant closure related costs, net 2,302   16   5,622   52 
Inventory write-downs related to exited categories 1,443   -   1,443   - 
Warehouse/manufacturing consolidation and other costs, net 811   -   811   - 
Gross profit, as adjusted 106,771  $103,873  $194,034  $198,244 
        
Reconciliation of Operating (Loss) Income, GAAP to Operating Income, as Adjusted:      
 Second Quarter Second Quarter Year to Date
  2024   2023   2024   2023 
Operating (loss) income, GAAP$(781) $27,389  $(3,059) $43,212 
Adjustments to Cost of sales:       
Plant closure related costs, net 2,302   16   5,622   52 
Inventory write-downs related to exited categories 1,443   -   1,443   - 
Warehouse/manufacturing consolidation and other costs, net 811   -   811   - 
        
Adjustments to Operating expenses(a):       
Long-lived asset impairment 20,666   340   21,360   340 
Productivity and transformation costs 6,869   986   13,272   1,759 
Certain litigation expenses, net(b) 2,091   2,482   3,615   4,945 
Transaction and integration costs, net 109   402   227   1,769 
CEO succession -   5,113   -   5,113 
Plant closure related costs, net -   37   (53)  (1)
Warehouse/manufacturing consolidation and other costs, net -   (1,413)  -   (1,413)
Operating income, as adjusted$33,510  $35,352  $43,238  $55,776 
        
Reconciliation of Net (Loss) Income, GAAP to Net Income, as Adjusted:       
 Second Quarter Second Quarter Year to Date
  2024   2023   2024   2023 
Net (loss) income, GAAP$(13,535) $10,966  $(23,911) $17,889 
Adjustments to Cost of sales:       
Plant closure related costs, net 2,302   16   5,622   52 
Inventory write-downs related to exited categories 1,443   -   1,443   - 
Warehouse/manufacturing consolidation and other costs, net 811   -   811   - 
        
Adjustments to Operating expenses(a):       
Long-lived asset impairment 20,666   340   21,360   340 
Productivity and transformation costs 6,869   986   13,272   1,759 
Certain litigation expenses, net(b) 2,091   2,482   3,615   4,945 
Transaction and integration costs, net 109   402   227   1,769 
CEO succession -   5,113   -   5,113 
Plant closure related costs, net -   37   (53)  (1)
Warehouse/manufacturing consolidation and other costs, net -   (1,413)  -   (1,413)
        
Adjustments to Interest and other expense, net(c):       
Unrealized currency losses 950   2,160   154   449 
(Gain) loss on sale of assets -   (3,355)  62   (3,395)
        
Adjustments to (Benefit) provision for income taxes:       
Net tax impact of non-GAAP adjustments (10,807)  526   (15,233)  (20)
Net income, as adjusted$10,899  $18,260  $7,369  $27,487 
Net (loss) income margin (3.0)%   2.4%   (2.7)%   2.0% 
Adjusted net income margin 2.4%   4.0%   0.8%   3.1% 
        
Diluted shares used in the calculation of net (loss) income per common share: 89,811   89,578   89,661   89,535 
        
Diluted net (loss) income per common share, GAAP$(0.15) $0.12  $(0.27) $0.20 
Diluted net income per common share, as adjusted$0.12  $0.20  $0.08  $0.31 
        
(a) Operating expenses include amortization of acquired intangibles, selling, general and administrative expenses, long-lived asset impairment and productivity and transformation costs.
(b) Expenses and items relating to securities class action and baby food litigation.
(c) Interest and other expense, net includes interest and other financing expenses, net, unrealized currency losses, (gain) loss on sale of assets and other expense, net.
        


THE HAIN CELESTIAL GROUP, INC. AND SUBSIDIARIES
Organic Net Sales Growth
(unaudited and in thousands)
      
Q2 FY24North America International Hain Consolidated
Net sales$267,671  $186,429  $454,100 
Divestitures and discontinued brands -   -   - 
Organic net sales$267,671  $186,429  $454,100 
      
Q2 FY23     
Net sales$282,361  $171,847  $454,208 
Divestitures and discontinued brands (1,148)  -   (1,148)
Organic net sales$281,213  $171,847  $453,060 
      
Net sales (decline) growth (5.2)%   8.5%   (0.0)% 
Impact of divestitures and discontinued brands 0.4%   0.0%   0.2% 
Organic net sales (decline) growth (4.8)%   8.5%   0.2% 
      
Q2 FY24 YTDNorth America International Hain Consolidated
Net sales$527,725  $351,404  $879,129 
Divestitures and discontinued brands 8   -   8 
Organic net sales$527,733  $351,404  $879,137 
      
Q2 FY23 YTD     
Net sales$570,757  $322,802  $893,559 
Divestitures and discontinued brands (2,910)  -   (2,910)
Organic net sales$567,847  $322,802  $890,649 
      
Net sales (decline) growth (7.5)%   8.9%   (1.6)% 
Impact of divestitures and discontinued brands 0.4%   0.0%   0.3% 
Organic net sales (decline) growth (7.1)%   8.9%   (1.3)% 
      


THE HAIN CELESTIAL GROUP, INC. AND SUBSIDIARIES
Adjusted EBITDA
(unaudited and in thousands)
        
 Second Quarter Second Quarter Year to Date
  2024   2023   2024   2023 
        
Net (loss) income$(13,535) $10,966  $(23,911) $17,889 
        
Depreciation and amortization 11,197   12,155   23,502   24,125 
Equity in net loss of equity-method investees 907   316   1,405   698 
Interest expense, net 15,333   10,379   27,956   17,658 
(Benefit) provision for income taxes (4,249)  6,357   (9,628)  8,988 
Stock-based compensation, net 3,376   3,435   7,118   7,429 
Unrealized currency (gains) losses (194)  2,160   (159)  449 
Certain litigation expenses, net(a) 2,091   2,482   3,615   4,945 
Restructuring activities       
Productivity and transformation costs 6,869   986   13,272   1,759 
Plant closure related costs, net 2,302   53   4,143   51 
Warehouse/manufacturing consolidation and other costs, net 811   (1,972)  811   (1,972)
CEO succession -   5,113   -   5,113 
Acquisitions, divestitures and other       
Transaction and integration costs, net 109   402   227   1,769 
(Gain) loss on sale of assets -   (3,355)  62   (3,395)
Impairment charges       
Long-lived asset impairment 20,666   340   21,360   340 
Inventory write-downs related to exited categories 1,443   -   1,443   - 
Adjusted EBITDA$47,126  $49,817  $71,216  $85,846 
        
(a) Expenses and items relating to securities class action and baby food litigation.    


THE HAIN CELESTIAL GROUP, INC. AND SUBSIDIARIES
Free Cash Flow
(unaudited and in thousands)
        
 Second Quarter Second Quarter Year to Date
  2024   2023   2024   2023 
        
Net cash provided by (used in) operating activities$20,655  $2,464  $34,685  $(2,652)
Purchases of property, plant and equipment (5,829)  (6,840)  (12,735)  (14,055)
Free cash flow$14,826  $(4,376) $21,950  $(16,707)
        


THE HAIN CELESTIAL GROUP, INC. AND SUBSIDIARIES 
Net Debt 
(unaudited and in thousands) 
     
 December 31, 2023 June 30, 2023 
Debt    
Long-term debt, less current portion$801,675 $821,181 
Current portion of long-term debt 7,569  7,567 
Total debt$809,244 $828,748 
Less: Cash and cash equivalents 53,672  53,364 
Net debt$755,572 $775,384 
     

 


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Source: The Hain Celestial Group, Inc.

2024 GlobeNewswire, Inc., source Press Releases