LAKE SUCCESS, N.Y.,
May 9, 2019 /PRNewswire/ -- The
Hain Celestial Group, Inc. (Nasdaq: HAIN) ("Hain Celestial" or the
"Company"), a leading organic and natural products company with
operations in North America,
Europe, Asia and the Middle
East providing consumers with A Healthier Way of Life™,
today reported financial results for the third quarter ended
March 31, 2019. The results contained
herein are presented with the Hain Pure Protein operating segment
being treated as a discontinued operation.
"We are encouraged by our third quarter financial results that
demonstrate sequential performance improvements in many key areas
of our business, and we are on track to achieve our fiscal year
2019 outlook," commented Mark L.
Schiller, Hain Celestial's President and Chief Executive
Officer. "Our team is in the early innings of executing on our
transformational strategic plan to simplify our portfolio,
strengthen our core capabilities, reinvigorate profitable top-line
growth, and expand margins, return-on-invested-capital and cash
flow. We remain committed to delivering consistency in our
operational and financial results to drive long-term shareholder
value."
FINANCIAL HIGHLIGHTS1
Summary of Third Quarter Results from Continuing
Operations2
- Net sales decreased 5% to $599.8
million compared to the prior year period.
- Net sales decreased 2% on a constant currency basis compared to
the prior year period.
- When adjusted for Foreign Exchange and Acquisitions,
Divestitures and certain other items, including the Project Terra
Stock Keeping Unit ("SKU") rationalization3, net sales
were flat compared to the prior year period.
- Gross margin of 20.9%, a 10 basis point decrease over the prior
year period and a 130 basis point increase from the second quarter
of fiscal 2019.
- Adjusted gross margin of 21.6%, a 140 basis point decrease over
the prior year period and a 130 basis point increase from the
second quarter of fiscal 2019.
- Operating income of $23.9 million
compared to $29.3 million in the
prior year period and an operating loss of $15.4 million in the second quarter of fiscal
2019.
- Adjusted operating income of $38.9
million compared to $56.0
million in the prior year period and $29.9 million in the second quarter of fiscal
2019.
- Net income of $10.1 million
compared to $25.2 million in the
prior year period and a net loss of $29.3
million in the second quarter of fiscal 2019.
- Adjusted net income of $21.7
million compared to $38.6
million in prior year period and $15.0 million in the second quarter of fiscal
2019.
- EBITDA of $41.5 million compared
to $51.5 million in the prior year
period and $19.2 million in the
second quarter of fiscal 2019.
- EBITDA margin of 6.9%, a 120 basis point decrease compared to
the prior year period and 360 basis point increase from the second
quarter of fiscal 2019.
- Adjusted EBITDA of $55.5 million
compared to $73.4 million in the
prior year period and $44.9 million
in the second quarter of fiscal 2019.
- Adjusted EBITDA margin of 9.3%, a 230 basis point decrease
compared to the prior year period and a 160 basis point increase
from the second quarter of fiscal 2019.
- EPS of $0.10 compared to
$0.24 in the prior year period and a
loss per diluted share of $0.28 in
the second quarter of fiscal 2019.
- Adjusted EPS of $0.21 compared to
$0.37 in the prior year period and
$0.14 in the second quarter of fiscal
2019.
SEGMENT HIGHLIGHTS FROM CONTINUING OPERATIONS
Hain Celestial United States
Hain Celestial United
States third quarter net sales of $266.4
million decreased 5% over the prior year period. When
adjusted for Acquisitions, Divestitures and certain other items
including the Project Terra SKU rationalization3, net
sales decreased 2% over the prior year period. Segment operating
income in the third quarter was $17.1
million, a 32% decrease from the prior year period and a
138% increase from the second quarter of fiscal 2019. Adjusted
operating income was $21.8 million, a
39% decrease over the prior year period and a 62% increase from the
second quarter of fiscal 2019. Segment EBITDA in the third quarter
was $20.9 million, a 33% decrease
from the prior year period and 70% increase from the second quarter
of fiscal 2019. Adjusted EBITDA was $25.5
million, a 48% increase from the second quarter of 2019 and
a 36% decrease over the prior year period.
Hain Celestial United Kingdom
Hain Celestial United
Kingdom third quarter net sales of $227.2
million decreased 5% over the prior year period. When
adjusted for Foreign Exchange, Acquisitions and Divestitures and
certain other items3 net sales increased 3% over the
prior year period. The net sales increase compared to the prior
year period was driven by 5% growth from Tilda® and 2% growth from
Ella's Kitchen®, or 11% and 9% growth, respectively, after
adjusting for Foreign Exchange, Acquisitions and Divestitures and
certain other items3. The results for the United Kingdom segment compared to the prior
year period also reflected an 8% decline in Hain Daniels, or 1% after adjusting for Foreign
Exchange, Acquisitions and Divestitures and certain other
items3, primarily driven by declines from the New Covent
Garden Soup Co.®, Cully & Sully®, and Johnson's Juice Co.™
brands and private label sales, offset in part by growth in the
Linda McCartney® and Hartley's® brands. Segment operating income
was $18.1 million, a 31% increase
over the prior year period and a 24% increase from the second
quarter of fiscal 2019. Adjusted operating income was $19.1 million, a decrease of 8% over the prior
year period and a 6% increase from the second quarter of fiscal
2019. Segment EBITDA in the third quarter was $25.8 million, a 7% increase from the prior year
period and an 18% increase from the second quarter of fiscal 2019.
Adjusted EBITDA was $26.7 million, a
6% decrease over the prior year period and 6% increase from the
second quarter of 2019.
Rest of World
Rest of World third quarter net sales of
$106.1 million decreased 6% over the
prior year period. When adjusted for Foreign Exchange, Acquisitions
and Divestitures and certain other items3 net sales
increased 1% over the prior year period. Net sales for Hain
Celestial Canada decreased 6%, or increased 2% compared to the
prior year period after adjusting for Foreign Exchange,
Acquisitions and Divestitures and certain other items3,
primarily driven by growth from the Sensible Portions® and Yves
Veggie Cuisine® brands, offset in part by declines from the
Europe's Best®, Live Clean® and
Dream® brands. Net sales for Hain Celestial Europe decreased 4%, or
increased 4% on a constant currency basis, primarily driven by
strong performance from the Joya® and Natumi® brands and private
label sales, offset in part by declines from the Lima®, Danival®
and Dream® brands. Net sales for Hain Ventures, formerly known as
Cultivate Ventures, decreased 16%, or 14% after adjusting for
Acquisitions and Divestitures and certain other items3,
primarily driven by declines from the BluePrint®, DeBoles® and
SunSpire® brands, offset in part by growth from the GG UniqueFiber™
brand. Segment operating income in the third quarter was
$10.9 million, a 2% decrease over the
prior year period and a 30% increase from the second quarter of
fiscal 2019. Adjusted operating income was $11.3 million, an 8% decrease over the prior year
period and a 21% increase from the second quarter of fiscal 2019.
Segment EBITDA in the third quarter was $14.0 million, a 2% increase from the prior year
period and a 21% increase from the second quarter of fiscal 2019.
Adjusted EBITDA was $14.4 million, a
4% decrease over the prior year period and a 17% increase from the
second quarter of 2019.
Hain Pure Protein Discontinued Operations
As
previously disclosed on May 5, 2018,
the results of operations, financial position and cash flows
related to the operations of the Hain Pure Protein business segment
have been moved to discontinued operations in the current and prior
periods. On February 15, 2019, the
Company completed the sale of substantially all of the assets used
primarily for the Plainville Farms business and on May 8, 2019 the Company entered into a definitive
agreement to sell all of its equity interest in Hain Pure Protein
Corporation, which includes the FreeBird® and Empire Kosher®
businesses. Net sales for Hain Pure Protein in the third quarter
were $88.7 million, a decrease of 25%
compared to the prior year period. Net loss from discontinued
operations, net of tax in the third quarter was $75.9 million and included a $40.0 million non-cash impairment charge and a
loss on sale of $29.7 million.
Fiscal Year 2019 Guidance
The Company reiterates its
annual guidance for continuing operations for fiscal year 2019:
- Total net sales of $2.320 billion
to $2.350 billion, a decrease of
approximately 4% to 6% as compared to fiscal year 2018.
- Adjusted EBITDA of $185 million
to $200 million, a decrease of
approximately 22% to 28% as compared to fiscal year 2018.
- Adjusted EPS of $0.60 to
$0.70, a decrease of approximately
40% to 48% as compared to fiscal year 2018.
Guidance, where adjusted, is provided on a non-GAAP basis and
excludes acquisition-related expenses; integration charges;
restructuring charges, start-up costs, consulting fees and other
costs associated with Project Terra; costs associated with the CEO
Succession Agreement; unrealized net foreign currency gains or
losses, and accounting review and remediation costs and other
non-recurring items that may be incurred during the Company's
fiscal year 2019, which the Company will continue to identify as it
reports its future financial results. Guidance also excludes the
impact of any future acquisitions and divestitures.
The Company cannot reconcile its expected Adjusted EBITDA to net
income or adjusted earnings per diluted share to earnings per
diluted share under "Fiscal Year 2019 Guidance" without
unreasonable effort because certain items that impact net income
and other reconciling metrics are out of the Company's control
and/or cannot be reasonably predicted at this time.
1 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 are
provided herein in the tables "Reconciliation of GAAP Results to
Non-GAAP Measures."
2 Unless otherwise noted all results included in this
press release are from continuing operations.
3 Refer to "Net Sales Growth at Constant Currency and
Adjusted for Acquisitions, Divestitures and Other" provided
herein.
(unaudited and
dollars in thousands)
|
United
States
|
United
Kingdom
|
Rest of
World
|
Corporate/
Other
|
Total
|
Net
Sales
|
|
|
|
|
|
Net sales - Three
months ended 3/31/19
|
$266,445
|
$227,206
|
$106,146
|
$
-
|
$
599,797
|
Net sales - Three
months ended 3/31/18
|
$281,052
|
$238,321
|
$113,347
|
$
-
|
$
632,720
|
% change - FY'19 net
sales vs. FY'18 net sales
|
(5.2)%
|
(4.7)%
|
(6.4)%
|
|
(5.2)%
|
|
|
|
|
|
|
Operating income
(loss)
|
|
|
|
|
|
Three months ended
3/31/19
|
|
|
|
|
|
Operating income
(loss)
|
$
17,099
|
$
18,147
|
$
10,868
|
$
(22,249)
|
$
23,865
|
Non-GAAP adjustments
(1)
|
4,676
|
976
|
432
|
8,955
|
15,039
|
Adjusted operating
income (loss)
|
$
21,775
|
$
19,123
|
$
11,300
|
$
(13,294)
|
$
38,904
|
Operating income
margin
|
6.4%
|
8.0%
|
10.2%
|
|
4.0%
|
Adjusted operating
income margin
|
8.2%
|
8.4%
|
10.6%
|
|
6.5%
|
|
|
|
|
|
|
Three months ended
3/31/18
|
|
|
|
|
|
Operating income
(loss)
|
$
24,974
|
$
13,863
|
$
11,059
|
$
(20,642)
|
$
29,254
|
Non-GAAP adjustments
(1)
|
10,880
|
6,895
|
1,257
|
7,723
|
26,755
|
Adjusted operating
income (loss)
|
$
35,854
|
$
20,758
|
$
12,316
|
$
(12,919)
|
$
56,009
|
Operating income
margin
|
8.9%
|
5.8%
|
9.8%
|
|
4.6%
|
Adjusted operating
income margin
|
12.8%
|
8.7%
|
10.9%
|
|
8.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited and
dollars in thousands)
|
United
States
|
United
Kingdom
|
Rest of
World
|
Corporate/
Other
|
Total
|
Net
Sales
|
|
|
|
|
|
Net sales - Nine
months ended 3/31/19
|
$769,585
|
$671,121
|
$304,080
|
$
-
|
$1,744,786
|
Net sales - Nine
months ended 3/31/18
|
$815,013
|
$698,968
|
$324,190
|
$
-
|
$1,838,171
|
% change - FY'19 net
sales vs. FY'18 net sales
|
(5.6)%
|
(4.0)%
|
(6.2)%
|
|
(5.1)%
|
|
|
|
|
|
|
Operating income
(loss)
|
|
|
|
|
|
Nine months ended
3/31/19
|
|
|
|
|
|
Operating income
(loss)
|
$
26,449
|
$
36,822
|
$
27,078
|
$
(105,975)
|
$
(15,626)
|
Non-GAAP adjustments
(1)
|
16,413
|
11,050
|
2,731
|
75,075
|
105,269
|
Adjusted operating
income (loss)
|
$
42,862
|
$
47,872
|
$
29,809
|
$
(30,900)
|
$
89,643
|
Operating income
(loss) margin
|
3.4%
|
5.5%
|
8.9%
|
|
(0.9)%
|
Adjusted operating
income margin
|
5.6%
|
7.1%
|
9.8%
|
|
5.1%
|
|
|
|
|
|
|
Nine months ended
3/31/18
|
|
|
|
|
|
Operating income
(loss)
|
$
67,696
|
$
37,062
|
$
30,591
|
$
(45,889)
|
$
89,460
|
Non-GAAP adjustments
(1)
|
22,272
|
12,970
|
2,123
|
14,769
|
52,134
|
Adjusted operating
income (loss)
|
$
89,968
|
$
50,032
|
$
32,714
|
$
(31,120)
|
$
141,594
|
Operating income
margin
|
8.3%
|
5.3%
|
9.4%
|
|
4.9%
|
Adjusted operating
income margin
|
11.0%
|
7.2%
|
10.1%
|
|
7.7%
|
|
|
|
|
|
|
(1) See
accompanying table of "Reconciliation of GAAP Results to Non-GAAP
Measures"
|
Webcast Presentation
Hain Celestial will host a
conference call and webcast today at 8:30 AM
Eastern Time to discuss its results and business outlook.
The call will be webcast and available under the Investor Relations
section of the Company's website at www.hain.com.
About The Hain Celestial Group, Inc.
The Hain
Celestial Group (Nasdaq: HAIN), headquartered in Lake Success, NY, is a leading organic and
natural products company with operations in North America, Europe, Asia
and the Middle East. Hain
Celestial participates in many natural categories with well-known
brands that include Almond Dream®, Arrowhead Mills®, Bearitos®,
Better Bean®, BluePrint®, Casbah®, Celestial Seasonings®, Clarks™,
Coconut Dream®, Cully & Sully®, Danival®, DeBoles®, Earth's
Best®, Ella's Kitchen®, Europe's
Best®, Farmhouse Fare™, Frank
Cooper's®, Gale's®, Garden of Eatin'®, GG UniqueFiber™, Hain
Pure Foods®, Hartley's®, Health Valley®, Imagine™, Johnson's Juice
Co.™, Joya®, Kosher Valley®, Lima®, Linda McCartney® (under
license), MaraNatha®, Mary Berry
(under license), Natumi®, New Covent Garden Soup Co.®, Orchard
House®, Rice Dream®, Robertson's®, Rudi's Gluten-Free Bakery™,
Rudi's Organic Bakery®, Sensible Portions®, Spectrum® Organics, Soy
Dream®, Sun-Pat®, Sunripe®, SunSpire®, Terra®, The Greek Gods®,
Tilda®, Walnut Acres®, WestSoy®, Yorkshire Provender®, Yves Veggie
Cuisine® and William's™. The Company's personal care products are
marketed under the Alba Botanica®, Avalon Organics®, Earth's Best®,
JASON®, Live Clean® and Queen Helene® brands.
Safe Harbor Statement
Certain statements contained in
this press release constitute "forward-looking statements" within
the meaning of federal securities laws, including the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements are predictions based on expectations and projections
about future events and are not statements of historical fact. You
can identify forward-looking statements by the use of
forward-looking terminology such as "plan", "continue", "expect",
"anticipate", "intend", "predict", "project", "estimate", "likely",
"believe", "might", "seek", "may", "will", "remain", "potential",
"can", "should", "could", "future" and similar expressions, or the
negative of those expressions, or similar words or phrases that are
predictions of or indicate future events or trends and that do not
relate solely to historical matters. You can also identify
forward-looking statements by discussions of the Company's
strategic initiatives, including Project Terra, the Company's
announced divestiture of its Hain Pure Protein business, the
Company's Guidance for Fiscal Year 2019 and our future performance
and results of operations.
Forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
levels of activity, performance or achievements of the Company, or
industry results, to be materially different from any future
results, levels of activity, performance or achievements expressed
or implied by such forward-looking statements, and you should not
rely on them as predictions of future events. Forward-looking
statements depend on assumptions, data or methods that may be
incorrect or imprecise and may not be able to be realized. We do
not guarantee that the transactions and events described will
happen as described (or that they will happen at all). Such
factors, include, among others, the Company's beliefs or
expectations relating to the impact of competitive products,
changes to the competitive environment, changes to consumer
preferences, consolidation of customers, reliance on independent
distributors, general economic and financial market conditions,
risks associated with our international sales and operations, our
ability to manage our supply chain effectively, changes in raw
materials, freight, commodity costs and fuel, our ability to
execute and realize cost savings initiatives, including, but not
limited to, cost reduction initiatives under Project Terra and SKU
rationalization plans, the identification and remediation of
material weaknesses in our internal controls over financial
reporting, our ability to manage our financial reporting and
internal control system processes, potential liabilities due to
legal claims, government investigations and other regulatory
enforcement actions, costs incurred due to pending and future
litigation, the availability of key personnel and changes in our
management team, potential liability if our products cause illness
or physical harm, impairments in the carrying value of goodwill or
other intangible assets, our ability to identify and complete
acquisitions or divestitures and integrate acquisitions, the
availability of organic and natural ingredients, the reputation of
our brands, risks relating to the protection of intellectual
property, cybersecurity risks, unanticipated expenditures and other
risks detailed from time-to-time in the Company's reports filed
with the United States Securities and Exchange Commission,
including the Annual Report on Form 10-K for the fiscal year ended
June 30, 2018, and our quarterly
reports. As a result of the foregoing and other factors, the
Company cannot provide any assurance regarding future results,
levels of activity and achievements of the Company, and neither the
Company nor any person assumes responsibility for the accuracy and
completeness of these statements. All forward-looking statements
contained herein apply as of the date hereof or as of the date they
were made and, except as required by applicable law, the Company
disclaims any obligation to publicly update or revise any
forward-looking statement to reflects changes in underlying
assumptions or factors of new methods, future events or other
changes.
Non-GAAP Financial Measures
This press release and the
accompanying tables include non-GAAP financial measures, including
net sales adjusted for the impact of Foreign Exchange, Acquisitions
and Divestitures and certain other items, including SKU
rationalization, as applicable in each case, adjusted operating
income, adjusted gross margin, adjusted net income, adjusted
earnings per diluted share, EBITDA, Adjusted EBITDA and operating
free cash flow. The reconciliations of these non-GAAP financial
measures to the comparable GAAP financial measures are presented in
the tables "Reconciliation of GAAP Results to Non-GAAP Measures"
for the three and nine months ended March
31, 2019 and 2018 and the three months ended December 31, 2018 and in the paragraphs below.
Management believes 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. 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 Statements of Operations
presented in accordance with GAAP.
The Company defines Operating Free Cash Flow as cash provided by
or used in operating activities from continuing operations (a GAAP
measure) less capital expenditures. The Company views Operating
Free Cash Flow as an important measure because it is one factor in
evaluating the amount of cash available for discretionary
investments.
For the three and nine months ended March
31, 2019 and 2018, Operating Free Cash Flow from continuing
operations was calculated as follows:
|
Three Months Ended
March 31,
|
|
Nine Months Ended
March 31,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
|
(unaudited and
dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
Cash flow provided by
operating activities - continuing operations
|
$
13,056
|
|
$
38,980
|
|
$
12,043
|
|
$
67,370
|
Purchases of
property, plant and equipment
|
(14,353)
|
|
(23,683)
|
|
(55,892)
|
|
(48,368)
|
Operating Free Cash
Flow - continuing operations
|
$
(1,297)
|
|
$
15,297
|
|
$
(43,849)
|
|
$
19,002
|
The Company's Operating Free Cash Flow from continuing
operations was negative $1.3 million
for the three months ended March 31,
2019, a decrease of $16.6
million from the three months ended March 31, 2018. This decrease resulted
primarily from a decrease in net income adjusted for non-cash and
cash used in working capital accounts, offset in part by a decrease
in capital expenditures. The Company's Operating Free Cash Flow
from continuing operations was negative $43.8 million for the nine months ended
March 31, 2019, a decrease of
$62.9 million from the nine months
ended March 31, 2018. This decrease
resulted primarily from a decrease in net income adjusted for
non-cash charges and increased capital expenditures in the current
year, offset in part by cash provided by working capital
accounts.
The Company believes presenting net sales at constant currency
provides useful information to investors because it provides
transparency to underlying performance in the Company's
consolidated net sales by excluding the effect that foreign
currency exchange rate fluctuations have on period-to-period
comparability given the volatility in foreign currency exchange
markets. To present this information for historical periods,
current period net sales for entities reporting in currencies other
than the U.S. dollar are translated into U.S. dollars at the
average monthly exchange rates in effect during the corresponding
period of the prior fiscal year, rather than at the actual average
monthly exchange rate in effect during the current period of the
current fiscal year. As a result, the foreign currency impact is
equal to the current year results in local currencies multiplied by
the change in average foreign currency exchange rate between the
current fiscal period and the corresponding period of the prior
fiscal year.
The Company provides net sales adjusted for constant currency,
acquisitions and divestitures, and certain other items including
SKU rationalization, as applicable in each case, to understand the
growth rate of net sales excluding the impact of such items. The
Company's management believes net sales adjusted for such items is
useful to investors because it enables them to better understand
the growth of our business from period-to-period.
The Company defines EBITDA as net (loss) income from continuing
operations (a GAAP measure) before income taxes, net interest
expense, depreciation and amortization, equity in net loss (income)
of equity-method investees, stock-based compensation, net,
stock-based compensation expense in connection with the Succession
Plan, long-lived asset and intangible impairments and unrealized
currency gains and losses. The Company defines segment EBITDA as
operating income (a GAAP measure) before depreciation and
amortization, stock-based compensation, net and long-lived asset
impairments. Adjusted EBITDA is defined as EBITDA before
acquisition-related expenses, including integration and
restructuring charges, and other non-recurring items. The Company's
management believes that these presentations provide useful
information to management, analysts and investors regarding certain
additional financial and business trends relating to its results of
operations and financial condition. In addition, management uses
these measures for reviewing the financial results of the Company
as well as a component of performance-based executive
compensation.
For the three and nine months ended March
31, 2019 and 2018, EBITDA and Adjusted EBITDA from
continuing operations was calculated as follows:
|
Three Months Ended
March 31,
|
|
Nine Months Ended
March 31,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
(unaudited and
dollars in thousands)
|
|
|
|
|
|
|
|
|
Net (loss)
income
|
$
(65,837)
|
|
$
12,686
|
|
$
(169,763)
|
|
$
79,635
|
Net loss from
discontinued operations
|
(75,925)
|
|
(12,555)
|
|
(127,472)
|
|
(7,349)
|
Net income (loss)
from continuing operations
|
$
10,088
|
|
$
25,241
|
|
$
(42,291)
|
|
$
86,984
|
|
|
|
|
|
|
|
|
Provision (benefit)
for income taxes
|
3,114
|
|
(1,310)
|
|
(1,679)
|
|
(11,516)
|
Interest expense,
net
|
8,677
|
|
6,108
|
|
24,093
|
|
17,535
|
Depreciation and
amortization
|
13,968
|
|
15,074
|
|
42,074
|
|
45,139
|
Equity in net loss
(income) of equity-method investees
|
205
|
|
101
|
|
391
|
|
(104)
|
Stock-based
compensation, net
|
3,937
|
|
2,936
|
|
5,502
|
|
10,258
|
Stock-based
compensation expense in connection with
Chief Executive Officer Succession Agreement
|
-
|
|
-
|
|
429
|
|
-
|
Long-lived asset and
intangibles impairment
|
-
|
|
4,839
|
|
23,709
|
|
8,290
|
Unrealized currency
losses/(gains)
|
1,522
|
|
(1,465)
|
|
2,551
|
|
(5,170)
|
EBITDA
|
$
41,511
|
|
$
51,524
|
|
$
54,779
|
|
$
151,416
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Project Terra costs
and other
|
9,259
|
|
4,831
|
|
29,464
|
|
13,750
|
Chief Executive
Officer Succession Plan expense, net
|
455
|
|
-
|
|
29,727
|
|
-
|
Accounting review and
remediation costs, net of insurance proceeds
|
-
|
|
3,313
|
|
4,334
|
|
6,406
|
Warehouse/manufacturing facility start-up
costs
|
3,222
|
|
-
|
|
9,529
|
|
1,155
|
Plant closure related
costs
|
184
|
|
3,246
|
|
3,503
|
|
3,946
|
SKU
rationalization
|
505
|
|
4,913
|
|
2,035
|
|
4,913
|
Litigation and
related expenses
|
371
|
|
235
|
|
1,062
|
|
235
|
Losses on terminated
chilled desserts contract
|
-
|
|
2,939
|
|
-
|
|
6,553
|
Co-packer
disruption
|
-
|
|
952
|
|
-
|
|
3,692
|
Regulated packaging
change
|
-
|
|
-
|
|
-
|
|
1,007
|
Toys "R" Us bad
debt
|
-
|
|
897
|
|
-
|
|
897
|
Machine break-down
costs
|
-
|
|
317
|
|
-
|
|
317
|
Recall and other
related costs
|
-
|
|
273
|
|
-
|
|
273
|
Adjusted
EBITDA
|
$
55,507
|
|
$
73,440
|
|
$
134,433
|
|
$
194,560
|
THE HAIN CELESTIAL
GROUP, INC.
|
Consolidated
Balance Sheets
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
June
30,
|
|
|
|
2019
|
|
2018
|
ASSETS
|
(unaudited)
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
27,562
|
|
$
106,557
|
|
Restricted
cash
|
34,452
|
|
-
|
|
Accounts receivable,
net
|
256,799
|
|
252,708
|
|
Inventories
|
395,246
|
|
391,525
|
|
Prepaid expenses and
other current assets
|
54,786
|
|
59,946
|
|
Current assets of
discontinued operations
|
136,181
|
|
240,851
|
|
Total current
assets
|
905,026
|
|
1,051,587
|
Property, plant and
equipment, net
|
331,070
|
|
310,172
|
Goodwill
|
|
1,016,863
|
|
1,024,136
|
Trademarks and other
intangible assets, net
|
475,582
|
|
510,387
|
Investments and joint
ventures
|
19,228
|
|
20,725
|
Other
assets
|
30,502
|
|
29,667
|
|
Total
assets
|
$2,778,271
|
|
$2,946,674
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts
payable
|
$
205,014
|
|
$
229,993
|
|
Accrued expenses and
other current liabilities
|
176,400
|
|
116,001
|
|
Current portion of
long-term debt
|
22,522
|
|
26,605
|
|
Current liabilities
of discontinued operations
|
15,195
|
|
49,846
|
|
Total current
liabilities
|
419,131
|
|
422,445
|
Long-term debt, less
current portion
|
729,201
|
|
687,501
|
Deferred income
taxes
|
63,619
|
|
86,909
|
Other noncurrent
liabilities
|
16,528
|
|
12,770
|
Total
liabilities
|
1,228,479
|
|
1,209,625
|
Stockholders'
equity:
|
|
|
|
|
Common
stock
|
1,087
|
|
1,084
|
|
Additional paid-in
capital
|
1,154,182
|
|
1,148,196
|
|
Retained
earnings
|
708,568
|
|
878,516
|
|
Accumulated other
comprehensive loss
|
(204,467)
|
|
(184,240)
|
|
|
|
1,659,370
|
|
1,843,556
|
|
Treasury
stock
|
(109,578)
|
|
(106,507)
|
|
Total stockholders'
equity
|
1,549,792
|
|
1,737,049
|
|
Total liabilities and
stockholders' equity
|
$2,778,271
|
|
$2,946,674
|
THE HAIN CELESTIAL
GROUP, INC.
|
Consolidated
Statements of Operations
|
(unaudited and
in thousands, except per share amounts)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
Nine Months Ended
March 31,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
|
|
|
|
|
|
Net sales
|
$
599,797
|
|
$
632,720
|
|
$
1,744,786
|
|
$
1,838,171
|
Cost of
sales
|
474,528
|
|
499,707
|
|
1,405,650
|
|
1,447,820
|
Gross
profit
|
125,269
|
|
133,013
|
|
339,136
|
|
390,351
|
Selling, general and
administrative expenses
|
87,739
|
|
86,063
|
|
255,383
|
|
258,586
|
Amortization of
acquired intangibles
|
3,802
|
|
4,713
|
|
11,567
|
|
13,859
|
Project Terra costs
and other
|
9,408
|
|
4,831
|
|
29,613
|
|
13,750
|
Chief Executive
Officer Succession Plan expense, net
|
455
|
|
-
|
|
30,156
|
|
-
|
Accounting review and
remediation costs, net of insurance proceeds
|
-
|
|
3,313
|
|
4,334
|
|
6,406
|
Long-lived asset and
intangibles impairment
|
-
|
|
4,839
|
|
23,709
|
|
8,290
|
Operating income
(loss)
|
23,865
|
|
29,254
|
|
(15,626)
|
|
89,460
|
Interest and other
financing expense, net
|
9,390
|
|
6,782
|
|
25,912
|
|
19,543
|
Other
expense/(income), net
|
1,068
|
|
(1,560)
|
|
2,041
|
|
(5,447)
|
Income (loss) from
continuing operations before income taxes and
equity in net loss (income) of equity-method investees
|
13,407
|
|
24,032
|
|
(43,579)
|
|
75,364
|
Provision (benefit)
for income taxes
|
3,114
|
|
(1,310)
|
|
(1,679)
|
|
(11,516)
|
Equity in net loss
(income) of equity-method investees
|
205
|
|
101
|
|
391
|
|
(104)
|
Net
income (loss) from continuing operations
|
$
10,088
|
|
$
25,241
|
|
$
(42,291)
|
|
$
86,984
|
Net loss
from discontinued operations, net of tax
|
(75,925)
|
|
(12,555)
|
|
(127,472)
|
|
(7,349)
|
Net (loss)
income
|
$
(65,837)
|
|
$
12,686
|
|
$
(169,763)
|
|
$
79,635
|
|
|
|
|
|
|
|
|
Net (loss) income per
common share:
|
|
|
|
|
|
|
|
Basic net income
(loss) per common share from continuing operations
|
$
0.10
|
|
$
0.24
|
|
$
(0.41)
|
|
$
0.84
|
Basic net loss per
common share from discontinued operations
|
(0.73)
|
|
(0.12)
|
|
(1.23)
|
|
(0.07)
|
Basic
net (loss) income per common share
|
$
(0.63)
|
|
$
0.12
|
|
$
(1.63)
|
|
$
0.77
|
|
|
|
|
|
|
|
|
Diluted net income
(loss) per common share from continuing operations
|
$
0.10
|
|
$
0.24
|
|
$
(0.41)
|
|
$
0.83
|
Diluted net loss per
common share from discontinued operations
|
(0.73)
|
|
(0.12)
|
|
(1.23)
|
|
(0.07)
|
Diluted
net (loss) income per common share
|
$
(0.63)
|
|
$
0.12
|
|
$
(1.63)
|
|
$
0.76
|
|
|
|
|
|
|
|
|
Shares used in the
calculation of net (loss) income per common share:
|
|
|
|
|
|
|
Basic
|
104,117
|
|
103,918
|
|
104,045
|
|
103,821
|
Diluted
|
104,334
|
|
104,503
|
|
104,045
|
|
104,473
|
THE HAIN CELESTIAL
GROUP, INC.
|
Consolidated
Statements of Cash Flows
|
(unaudited and
dollars in thousands)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
Nine Months Ended
March 31,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
CASH FLOWS FROM
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
Net (loss)
income
|
$
(65,837)
|
|
$
12,686
|
|
$
(169,763)
|
|
$
79,635
|
Net loss from
discontinued operations
|
(75,925)
|
|
(12,555)
|
|
(127,472)
|
|
(7,349)
|
Net income (loss)
from continuing operations
|
10,088
|
|
25,241
|
|
(42,291)
|
|
86,984
|
Adjustments to
reconcile net income (loss) from continuing operations to net
cash
provided by operating activities from continuing
operations:
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
13,968
|
|
15,074
|
|
42,074
|
|
45,139
|
Deferred income
taxes
|
(1,863)
|
|
(1,307)
|
|
(24,653)
|
|
(30,115)
|
Chief Executive
Officer Succession Plan expense, net
|
455
|
|
-
|
|
29,727
|
|
-
|
Equity in net loss
(income) of equity-method investees
|
205
|
|
101
|
|
391
|
|
(104)
|
Stock-based
compensation, net
|
3,937
|
|
2,936
|
|
5,931
|
|
10,258
|
Long-lived asset and
intangibles impairment
|
-
|
|
4,841
|
|
23,709
|
|
8,290
|
Other non-cash items,
net
|
2,418
|
|
(265)
|
|
3,703
|
|
(2,025)
|
Increase (decrease)
in cash attributable to changes in operating assets and
liabilities:
|
|
|
|
|
|
|
|
Accounts
receivable
|
(15,407)
|
|
(7,921)
|
|
(8,824)
|
|
(23,998)
|
Inventories
|
10,296
|
|
19,776
|
|
(7,176)
|
|
(43,355)
|
Other current
assets
|
2,080
|
|
(4,264)
|
|
315
|
|
(8,153)
|
Other assets and
liabilities
|
632
|
|
108
|
|
5,248
|
|
5,367
|
Accounts payable and
accrued expenses
|
(13,753)
|
|
(15,340)
|
|
(16,111)
|
|
19,082
|
Net cash provided by
operating activities - continuing operations
|
13,056
|
|
38,980
|
|
12,043
|
|
67,370
|
CASH FLOWS FROM
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
Purchases of property
and equipment
|
(14,353)
|
|
(23,683)
|
|
(55,892)
|
|
(48,368)
|
Acquisitions of
businesses, net of cash acquired
|
-
|
|
-
|
|
-
|
|
(13,064)
|
Other
|
-
|
|
124
|
|
3,863
|
|
124
|
Net cash used in
investing activities - continuing operations
|
(14,353)
|
|
(23,559)
|
|
(52,029)
|
|
(61,308)
|
CASH FLOWS FROM
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
Borrowings under bank
revolving credit facility
|
90,000
|
|
10,000
|
|
240,000
|
|
45,000
|
Repayments under bank
revolving credit facility
|
(49,145)
|
|
(320,185)
|
|
(186,791)
|
|
(355,185)
|
Borrowings under term
loan
|
-
|
|
299,245
|
|
-
|
|
299,245
|
Repayments under term
loan
|
(3,750)
|
|
-
|
|
(11,250)
|
|
-
|
Funding of
discontinued operations entities
|
(33,455)
|
|
(4,409)
|
|
(37,451)
|
|
(17,167)
|
(Repayments)
borrowings of other debt, net
|
(13,397)
|
|
(10,801)
|
|
(4,770)
|
|
3,111
|
Shares withheld for
payment of employee payroll taxes
|
(149)
|
|
(168)
|
|
(3,071)
|
|
(6,853)
|
Net cash used in
financing activities - continuing operations
|
(9,896)
|
|
(26,318)
|
|
(3,333)
|
|
(31,849)
|
Effect of exchange
rate changes on cash
|
744
|
|
2,119
|
|
(1,225)
|
|
5,884
|
CASH FLOWS FROM
DISCONTINUED OPERATIONS
|
|
|
|
|
|
|
|
Cash used in
operating activities
|
(5,489)
|
|
(8,819)
|
|
(7,339)
|
|
(11,783)
|
Cash used in
investing activities
|
(29,811)
|
|
(2,189)
|
|
(32,742)
|
|
(8,531)
|
Cash provided by
financing activities
|
33,398
|
|
4,356
|
|
37,299
|
|
17,011
|
Net
cash flows used in discontinued operations
|
(1,902)
|
|
(6,652)
|
|
(2,782)
|
|
(3,303)
|
Net decrease in cash
and cash equivalents and restricted cash
|
(12,351)
|
|
(15,430)
|
|
(47,326)
|
|
(23,206)
|
Cash and cash
equivalents at beginning of period
|
78,043
|
|
139,216
|
|
113,018
|
|
146,992
|
Cash and cash
equivalents and restricted cash at end of period
|
$
65,692
|
|
$
123,786
|
|
$
65,692
|
|
$
123,786
|
Less: cash and cash
equivalents of discontinued operations
|
(3,678)
|
|
(6,634)
|
|
(3,678)
|
|
(6,634)
|
Cash and cash
equivalents and restricted cash of continuing operations at end of
period
|
$
62,014
|
|
$
117,152
|
|
$
62,014
|
|
$
117,152
|
THE HAIN CELESTIAL
GROUP, INC.
|
Reconciliation of GAAP Results to Non-GAAP
Measures
|
(unaudited and
in thousands, except per share amounts)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
2019
GAAP
|
Adjustments
|
2019
Adjusted
|
|
2018
GAAP
|
Adjustments
|
2018
Adjusted
|
|
|
|
|
|
|
|
|
Net sales
|
$
599,797
|
-
|
$
599,797
|
|
$
632,720
|
-
|
$
632,720
|
Cost of
sales
|
474,528
|
(4,153)
|
470,375
|
|
499,707
|
(12,640)
|
487,067
|
Gross
profit
|
125,269
|
4,153
|
129,422
|
|
133,013
|
12,640
|
145,653
|
Operating expenses
(a)
|
91,541
|
(1,023)
|
90,518
|
|
95,615
|
(5,971)
|
89,644
|
Project Terra costs
and other
|
9,408
|
(9,408)
|
-
|
|
4,831
|
(4,831)
|
-
|
Chief Executive
Officer Succession Plan expense, net
|
455
|
(455)
|
-
|
|
-
|
-
|
-
|
Accounting review and
remediation costs, net of insurance proceeds
|
-
|
-
|
-
|
|
3,313
|
(3,313)
|
-
|
Operating
income
|
23,865
|
15,039
|
38,904
|
|
29,254
|
26,755
|
56,009
|
Interest and other
expense (income), net (b)
|
10,458
|
(1,522)
|
8,936
|
|
5,222
|
1,465
|
6,687
|
Provision (benefit)
for income taxes
|
3,114
|
4,963
|
8,077
|
|
(1,310)
|
11,946
|
10,636
|
Net
income from continuing operations
|
10,088
|
11,598
|
21,686
|
|
25,241
|
13,344
|
38,585
|
Net
(loss) income from discontinued operations, net of tax
|
(75,925)
|
75,925
|
-
|
|
(12,555)
|
12,555
|
-
|
Net (loss)
income
|
(65,837)
|
87,523
|
21,686
|
|
12,686
|
25,899
|
38,585
|
|
|
|
|
|
|
|
|
Diluted net income
per common share from continuing operations
|
0.10
|
0.11
|
0.21
|
|
0.24
|
0.13
|
0.37
|
Diluted net (loss)
income per common share from discontinued operations
|
(0.73)
|
0.73
|
-
|
|
(0.12)
|
0.12
|
-
|
Diluted
net (loss) income per common share
|
(0.63)
|
0.84
|
0.21
|
|
0.12
|
0.25
|
0.37
|
|
|
|
|
|
|
|
|
Detail of
Adjustments:
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31, 2019
|
|
|
|
Three Months
Ended
March 31, 2018
|
|
Warehouse/manufacturing facility start-up
costs
|
|
$
3,222
|
|
|
|
$
-
|
|
Plant closure related
costs
|
|
426
|
|
|
|
3,246
|
|
SKU
rationalization
|
|
505
|
|
|
|
4,913
|
|
Recall and other
related costs
|
|
-
|
|
|
|
273
|
|
Machine break-down
costs
|
|
-
|
|
|
|
317
|
|
Losses on terminated
chilled desserts contract
|
|
-
|
|
|
|
2,939
|
|
Co-packer
disruption
|
|
-
|
|
|
|
952
|
|
Cost of
sales
|
|
4,153
|
|
|
|
12,640
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
4,153
|
|
|
|
12,640
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation acceleration
|
|
583
|
|
|
|
-
|
|
Long-lived asset
impairment charge associated with plant closure
|
|
-
|
|
|
|
4,839
|
|
Litigation and
related expenses
|
|
371
|
|
|
|
235
|
|
Plant closure related
costs
|
|
69
|
|
|
|
-
|
|
Toys "R" Us bad
debt
|
|
-
|
|
|
|
897
|
|
Operating expenses
(a)
|
|
1,023
|
|
|
|
5,971
|
|
|
|
|
|
|
|
|
|
Project Terra costs
and other
|
|
9,408
|
|
|
|
4,831
|
|
Project Terra costs
and other
|
|
9,408
|
|
|
|
4,831
|
|
|
|
|
|
|
|
|
|
Chief Executive
Officer Succession Plan expense, net
|
|
455
|
|
|
|
-
|
|
Chief Executive
Officer Succession Plan expense, net
|
|
455
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
Accounting review and
remediation costs, net of insurance proceeds
|
|
-
|
|
|
|
3,313
|
|
Accounting review and
remediation costs, net of insurance proceeds
|
|
-
|
|
|
|
3,313
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
15,039
|
|
|
|
26,755
|
|
|
|
|
|
|
|
|
|
Unrealized currency
losses/(gains)
|
|
1,522
|
|
|
|
(1,465)
|
|
Interest and other
expense (income), net (b)
|
|
1,522
|
|
|
|
(1,465)
|
|
|
|
|
|
|
|
|
|
Income tax related
adjustments
|
|
(4,963)
|
|
|
|
(11,946)
|
|
Provision (benefit)
for income taxes
|
|
(4,963)
|
|
|
|
(11,946)
|
|
|
|
|
|
|
|
|
|
Net income
from continuing operations
|
|
$
11,598
|
|
|
|
$
13,344
|
|
|
|
|
|
|
|
|
|
(a)Operating expenses include amortization
of acquired intangibles, selling, general, and administrative
expenses and long-lived asset and intangibles
impairment.
|
(b)Interest and other expense (income),
net includes interest and other financing expenses, net and other
expense (income), net.
|
THE HAIN CELESTIAL
GROUP, INC.
|
Reconciliation of GAAP Results to Non-GAAP
Measures
|
(unaudited and
in thousands, except per share amounts)
|
|
|
|
|
|
|
|
|
|
Nine Months Ended
March 31,
|
|
2019
GAAP
|
Adjustments
|
2019
Adjusted
|
|
2018
GAAP
|
Adjustments
|
2018
Adjusted
|
|
|
|
|
|
|
|
|
Net sales
|
$
1,744,786
|
-
|
$
1,744,786
|
|
$
1,838,171
|
-
|
$
1,838,171
|
Cost of
sales
|
1,405,650
|
(15,309)
|
1,390,341
|
|
1,447,820
|
(21,856)
|
1,425,964
|
Gross
profit
|
339,136
|
15,309
|
354,445
|
|
390,351
|
21,856
|
412,207
|
Operating expenses
(a)
|
290,659
|
(25,857)
|
264,802
|
|
280,735
|
(10,122)
|
270,613
|
Project Terra costs
and other
|
29,613
|
(29,613)
|
-
|
|
13,750
|
(13,750)
|
-
|
Chief Executive
Officer Succession Plan expense, net
|
30,156
|
(30,156)
|
-
|
|
-
|
-
|
-
|
Accounting review and
remediation costs, net of insurance proceeds
|
4,334
|
(4,334)
|
-
|
|
6,406
|
(6,406)
|
-
|
Operating (loss)
income
|
(15,626)
|
105,269
|
89,643
|
|
89,460
|
52,134
|
141,594
|
Interest and other
expense (income), net (b)
|
27,953
|
(2,551)
|
25,402
|
|
14,096
|
5,170
|
19,266
|
(Benefit) provision
for income taxes
|
(1,679)
|
19,204
|
17,525
|
|
(11,516)
|
40,389
|
28,873
|
Net
(loss) income from continuing operations
|
(42,291)
|
88,616
|
46,325
|
|
86,984
|
6,575
|
93,559
|
Net
(loss) income from discontinued operations, net of tax
|
(127,472)
|
127,472
|
-
|
|
(7,349)
|
7,349
|
-
|
Net (loss)
income
|
(169,763)
|
216,088
|
46,325
|
|
79,635
|
13,924
|
93,559
|
|
|
|
|
|
|
|
|
Diluted net (loss)
income per common share from continuing operations
|
(0.41)
|
0.85
|
0.45
|
|
0.83
|
0.06
|
0.90
|
Diluted net (loss)
income per common share from discontinued operations
|
(1.23)
|
1.23
|
-
|
|
(0.07)
|
0.07
|
-
|
Diluted
net (loss) income per common share
|
(1.63)
|
2.08
|
0.45
|
|
0.76
|
0.13
|
0.90
|
|
|
|
|
|
|
|
|
Detail of
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months
Ended
March 31, 2019
|
|
|
|
Nine Months
Ended March 31, 2018
|
|
Warehouse/manufacturing facility start-up
costs
|
|
$
9,529
|
|
|
|
$
1,155
|
|
Plant closure related
costs
|
|
3,745
|
|
|
|
3,946
|
|
SKU
rationalization
|
|
2,035
|
|
|
|
4,913
|
|
Recall and other
related costs
|
|
-
|
|
|
|
273
|
|
Machine break-down
costs
|
|
-
|
|
|
|
317
|
|
Losses on terminated
chilled desserts contract
|
|
-
|
|
|
|
6,553
|
|
Co-packer
disruption
|
|
-
|
|
|
|
3,692
|
|
Regulated packaging
change
|
|
-
|
|
|
|
1,007
|
|
Cost of
sales
|
|
15,309
|
|
|
|
21,856
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
15,309
|
|
|
|
21,856
|
|
|
|
|
|
|
|
|
|
Intangibles
impairment
|
|
17,900
|
|
|
|
-
|
|
Long-lived asset
impairment charge associated with plant closure
|
|
5,809
|
|
|
|
8,290
|
|
Litigation and
related expenses
|
|
1,062
|
|
|
|
235
|
|
Stock-based
compensation acceleration
|
|
583
|
|
|
|
700
|
|
Plant closure related
costs
|
|
503
|
|
|
|
-
|
|
Toys "R" Us bad
debt
|
|
-
|
|
|
|
897
|
|
Operating expenses
(a)
|
|
25,857
|
|
|
|
10,122
|
|
|
|
|
|
|
|
|
|
Project Terra costs
and other
|
|
29,613
|
|
|
|
13,750
|
|
Project Terra costs
and other
|
|
29,613
|
|
|
|
13,750
|
|
|
|
|
|
|
|
|
|
Chief Executive
Officer Succession Plan expense, net
|
|
30,156
|
|
|
|
-
|
|
Chief Executive
Officer Succession Plan expense, net
|
|
30,156
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
Accounting review and
remediation costs, net of insurance proceeds
|
|
4,334
|
|
|
|
6,406
|
|
Accounting review and
remediation costs, net of insurance proceeds
|
|
4,334
|
|
|
|
6,406
|
|
|
|
|
|
|
|
|
|
Operating (loss)
income
|
|
105,269
|
|
|
|
52,134
|
|
|
|
|
|
|
|
|
|
Unrealized currency
losses/(gains)
|
|
2,551
|
|
|
|
(5,170)
|
|
Interest and other
expense (income), net (b)
|
|
2,551
|
|
|
|
(5,170)
|
|
|
|
|
|
|
|
|
|
Income tax related
adjustments
|
|
(19,204)
|
|
|
|
(40,389)
|
|
(Benefit) provision
for income taxes
|
|
(19,204)
|
|
|
|
(40,389)
|
|
|
|
|
|
|
|
|
|
Net
(loss) income from continuing operations
|
|
$
88,616
|
|
|
|
$
6,575
|
|
|
|
|
|
|
|
|
|
(a)Operating expenses include amortization
of acquired intangibles, selling, general, and administrative
expenses and long-lived asset and intangibles
impairment.
|
(b)Interest and other expense (income),
net includes interest and other financing expenses, net and other
expense (income), net.
|
THE HAIN CELESTIAL
GROUP, INC.
|
|
|
|
|
Net Sales Growth
at Constant Currency
|
|
|
|
|
(unaudited and
dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hain
Consolidated
|
|
United
Kingdom
|
|
Rest of
World
|
|
|
|
|
|
|
Net sales -
Three months ended 3/31/19
|
$
599,797
|
|
$
227,206
|
|
$
106,146
|
|
|
|
|
|
|
Impact of
foreign currency exchange
|
21,792
|
|
15,378
|
|
6,414
|
|
|
|
|
|
|
Net sales on a
constant currency basis -
Three months ended 3/31/19
|
$
621,589
|
|
$
242,584
|
|
$
112,560
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales - Three
months ended 3/31/18
|
$
632,720
|
|
$
238,321
|
|
$
113,347
|
|
|
|
|
|
|
Net sales growth on a
constant currency basis
|
(1.8)%
|
|
1.8%
|
|
(0.7)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hain
Consolidated
|
|
United
Kingdom
|
|
Rest of
World
|
|
|
|
|
|
|
Net sales -
Nine months ended 3/31/19
|
$
1,744,786
|
|
$
671,121
|
|
$
304,080
|
|
|
|
|
|
|
Impact of
foreign currency exchange
|
35,586
|
|
23,897
|
|
11,689
|
|
|
|
|
|
|
Net sales on a
constant currency basis -
Nine months ended 3/31/19
|
$
1,780,372
|
|
$
695,018
|
|
$
315,769
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales - Nine
months ended 3/31/18
|
$
1,838,171
|
|
$
698,968
|
|
$
324,190
|
|
|
|
|
|
|
Net sales growth on a
constant currency basis
|
(3.1)%
|
|
(0.6)%
|
|
(2.6)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Sales Growth
at Constant Currency and Adjusted for Acquisitions, Divestitures
and Other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hain
Consolidated
|
|
United
States
|
|
United
Kingdom
|
|
Rest of
World
|
|
|
|
|
Net sales on a
constant currency basis -
Three months ended 3/31/19
|
$
621,589
|
|
$
266,445
|
|
$
242,584
|
|
$
112,560
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales - Three
months ended 3/31/18
|
$
632,720
|
|
$
281,052
|
|
$
238,321
|
|
$
113,347
|
|
|
|
|
Castle contract
termination
|
(2,036)
|
|
-
|
|
(2,036)
|
|
-
|
|
|
|
|
Project Terra SKU
rationalization
|
(10,976)
|
|
(9,477)
|
|
-
|
|
(1,499)
|
|
|
|
|
Net sales on a
constant currency basis adjusted for
acquisitions, divestitures and other - Three months
ended 3/31/18
|
$
619,708
|
|
$
271,575
|
|
$
236,285
|
|
$
111,848
|
|
|
|
|
Net sales
growth on a constant currency
basis adjusted for acquisitions, divestitures and
other
|
0.3%
|
|
(1.9)%
|
|
2.7%
|
|
0.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tilda
|
|
Hain
Daniels
|
|
Ella's
Kitchen
|
|
Hain Celestial
Europe
|
|
Hain Celestial
Canada
|
|
Hain
Ventures
|
Net sales growth -
Three months ended 3/31/19
|
4.7%
|
|
(8.1)%
|
|
2.1%
|
|
(4.1)%
|
|
(5.9)%
|
|
(15.5)%
|
Impact of foreign
currency exchange
|
6.4%
|
|
6.3%
|
|
6.9%
|
|
7.9%
|
|
4.7%
|
|
– %
|
Impact of castle
contract termination
|
– %
|
|
1.2%
|
|
– %
|
|
– %
|
|
– %
|
|
– %
|
Impact of Project
Terra SKU rationalization
|
– %
|
|
– %
|
|
– %
|
|
– %
|
|
3.1%
|
|
1.2%
|
Net sales
growth on a constant currency basis adjusted for
acquisitions, divestitures and other - Three months
ended 3/31/19
|
11.1%
|
|
(0.6)%
|
|
9.0%
|
|
3.8%
|
|
1.9%
|
|
(14.3)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hain
Consolidated
|
|
United
States
|
|
United
Kingdom
|
|
Rest of
World
|
|
|
|
|
Net sales on a
constant currency basis -
Nine months ended 3/31/19
|
$
1,780,372
|
|
$
769,585
|
|
$
695,018
|
|
$
315,769
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales - Nine
months ended 3/31/18
|
$
1,838,171
|
|
$
815,013
|
|
$
698,968
|
|
$
324,190
|
|
|
|
|
Acquisitions
|
4,335
|
|
-
|
|
4,335
|
|
-
|
|
|
|
|
Castle contract
termination
|
(12,359)
|
|
-
|
|
(12,359)
|
|
-
|
|
|
|
|
Project Terra SKU
rationalization
|
(32,865)
|
|
(28,891)
|
|
-
|
|
(3,974)
|
|
|
|
|
Net sales on a
constant currency basis adjusted for
acquisitions, divestitures and other - Nine months
ended 3/31/18
|
$
1,797,282
|
|
$
786,122
|
|
$
690,944
|
|
$
320,216
|
|
|
|
|
Net sales
growth on a constant currency
basis adjusted for acquisitions, divestitures and
other
|
(0.9)%
|
|
(2.1)%
|
|
0.6%
|
|
(1.4)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tilda
|
|
Hain
Daniels
|
|
Ella's
Kitchen
|
|
Hain Celestial
Europe
|
|
Hain Celestial
Canada
|
|
Hain
Ventures
|
Net sales growth -
Nine months ended 3/31/19
|
3.5%
|
|
(6.9)%
|
|
3.3%
|
|
(1.6)%
|
|
(7.9)%
|
|
(16.7)%
|
Impact of foreign
currency exchange
|
3.8%
|
|
3.3%
|
|
3.6%
|
|
4.3%
|
|
4.1%
|
|
– %
|
Impact of
acquisitions
|
– %
|
|
(0.8)%
|
|
– %
|
|
– %
|
|
– %
|
|
– %
|
Impact of castle
contract termination
|
– %
|
|
2.3%
|
|
– %
|
|
– %
|
|
– %
|
|
– %
|
Impact of Project
Terra SKU rationalization
|
– %
|
|
– %
|
|
– %
|
|
– %
|
|
2.0%
|
|
2.6%
|
Net sales
growth on a constant currency basis adjusted for
acquisitions, divestitures and other - Nine months
ended 3/31/19
|
7.3%
|
|
(2.1)%
|
|
6.9%
|
|
2.7%
|
|
(1.8)%
|
|
(14.1)%
|
THE HAIN CELESTIAL
GROUP, INC.
|
Segment
Information
|
(unaudited and
dollars in thousands)
|
|
|
|
|
|
|
|
United
States
|
United
Kingdom
|
Rest of
World
|
Corporate/
Other
|
Total
|
Net
Sales
|
|
|
|
|
|
Net sales - Three
months ended 12/31/18
|
$
259,155
|
$
225,338
|
$
99,663
|
$
-
|
$
584,156
|
|
|
|
|
|
|
Operating income
(loss)
|
|
|
|
|
|
Three months ended
12/31/18
|
|
|
|
|
|
Operating income
(loss)
|
$
7,180
|
$
14,655
|
$
8,374
|
$
(45,596)
|
$
(15,387)
|
Non-GAAP adjustments
(1)
|
6,257
|
3,429
|
953
|
34,624
|
45,263
|
Adjusted operating
income (loss)
|
$
13,437
|
$
18,084
|
$
9,327
|
$
(10,972)
|
$
29,876
|
Operating income
(loss) margin
|
2.8%
|
6.5%
|
8.4%
|
|
(2.6)%
|
Adjusted operating
income margin
|
5.2%
|
8.0%
|
9.4%
|
|
5.1%
|
|
|
|
|
|
|
(1) See
accompanying table of "Reconciliation of GAAP Results to Non-GAAP
Measures"
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
EBITDA and Adjusted EBITDA
|
Three Months
Ended December 31, 2018
|
|
|
|
|
|
|
Net loss
|
$
(66,501)
|
|
|
|
|
Net loss from
discontinued operations
|
(37,223)
|
|
|
|
|
Net loss from
continuing operations
|
$
(29,278)
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
4,690
|
|
|
|
|
Interest expense,
net
|
8,247
|
|
|
|
|
Depreciation and
amortization
|
13,722
|
|
|
|
|
Equity in net loss of
equity-method investees
|
11
|
|
|
|
|
Stock-based
compensation, net
|
1,774
|
|
|
|
|
Stock-based
compensation expense in connection with
Chief Executive Officer Succession Agreement
|
117
|
|
|
|
|
Long-lived asset and
intangibles impairment
|
19,473
|
|
|
|
|
Unrealized currency
losses
|
439
|
|
|
|
|
EBITDA
|
$
19,195
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Project Terra costs
and other
|
9,872
|
|
|
|
|
Chief Executive
Officer Succession Plan expense, net
|
10,031
|
|
|
|
|
Accounting review and
remediation costs, net of insurance proceeds
|
920
|
|
|
|
|
Warehouse/manufacturing facility start-up
costs
|
1,708
|
|
|
|
|
Plant closure related
costs
|
1,490
|
|
|
|
|
SKU
rationalization
|
1,530
|
|
|
|
|
Litigation and
related expenses
|
122
|
|
|
|
|
Adjusted
EBITDA
|
$
44,868
|
|
|
|
|
THE HAIN CELESTIAL
GROUP, INC.
|
Segment EBITDA and
Adjusted EBITDA
|
(unaudited and
dollars in thousands)
|
|
|
|
|
|
|
United
States
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
March 31,
2019
|
|
December 31,
2018
|
|
March 31,
2018
|
|
|
|
|
|
|
Operating
Income
|
$
17,099
|
|
$
7,180
|
|
$
24,974
|
|
|
|
|
|
|
Depreciation and
amortization
|
3,274
|
|
3,264
|
|
3,871
|
Long-lived asset
impairment
|
-
|
|
1,354
|
|
2,282
|
Other
|
499
|
|
508
|
|
206
|
EBITDA
|
$
20,872
|
|
$
12,306
|
|
$
31,333
|
|
|
|
|
|
|
Project Terra costs
and other
|
1,246
|
|
1,952
|
|
1,079
|
Warehouse/manufacturing facility start-up
costs
|
3,101
|
|
1,508
|
|
-
|
Plant closure related
costs
|
26
|
|
115
|
|
2,084
|
SKU
rationalization
|
303
|
|
1,328
|
|
3,712
|
Co-packer
disruption
|
-
|
|
-
|
|
826
|
Toys "R" Us bad
debt
|
-
|
|
-
|
|
897
|
Adjusted
EBITDA
|
$
25,548
|
|
$
17,209
|
|
$
39,931
|
|
|
|
|
|
|
|
|
|
|
|
|
United
Kingdom
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
March 31,
2019
|
|
December 31,
2018
|
|
March 31,
2018
|
|
|
|
|
|
|
Operating
Income
|
$
18,147
|
|
$
14,655
|
|
$
13,863
|
|
|
|
|
|
|
Depreciation and
amortization
|
7,258
|
|
7,091
|
|
7,822
|
Long-lived asset
impairment
|
-
|
|
62
|
|
2,560
|
Other
|
371
|
|
71
|
|
(128)
|
EBITDA
|
$
25,776
|
|
$
21,879
|
|
$
24,117
|
|
|
|
|
|
|
Project Terra costs
and other
|
896
|
|
2,135
|
|
(483)
|
Plant closure related
costs
|
77
|
|
1,232
|
|
1,162
|
Litigation and
related expenses
|
-
|
|
10
|
|
-
|
Losses on terminated
chilled desserts contract
|
-
|
|
-
|
|
2,938
|
Co-packer
disruption
|
-
|
|
-
|
|
126
|
Machine break-down
costs
|
-
|
|
-
|
|
317
|
Recall and other
related costs
|
-
|
|
-
|
|
273
|
Adjusted
EBITDA
|
$
26,749
|
|
$
25,256
|
|
$
28,450
|
|
|
|
|
|
|
|
|
|
|
|
|
Rest of
World
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
March 31,
2019
|
|
December 31,
2018
|
|
March 31,
2018
|
|
|
|
|
|
|
Operating
Income
|
$
10,868
|
|
$
8,374
|
|
$
11,059
|
|
|
|
|
|
|
Depreciation and
amortization
|
2,953
|
|
2,932
|
|
2,830
|
Long-lived asset
impairment
|
-
|
|
156
|
|
-
|
Other
|
166
|
|
96
|
|
(190)
|
EBITDA
|
$
13,987
|
|
$
11,558
|
|
$
13,699
|
|
|
|
|
|
|
Project Terra costs
and other
|
17
|
|
279
|
|
57
|
Warehouse/manufacturing facility start-up
costs
|
121
|
|
200
|
|
-
|
Plant closure related
costs
|
93
|
|
116
|
|
-
|
SKU
rationalization
|
202
|
|
202
|
|
1,201
|
Adjusted
EBITDA
|
$
14,420
|
|
$
12,355
|
|
$
14,957
|
THE HAIN CELESTIAL
GROUP, INC.
|
|
|
Reconciliation of GAAP Results to Non-GAAP
Measures
|
|
|
(unaudited and
in thousands, except per share amounts)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
December 31,
|
|
|
|
2018
GAAP
|
Adjustments
|
2018
Adjusted
|
|
|
|
|
|
|
|
|
Net sales
|
$
584,156
|
-
|
$
584,156
|
|
|
Cost of
sales
|
469,883
|
(4,294)
|
465,589
|
|
|
Gross
profit
|
114,273
|
4,294
|
118,567
|
|
|
Operating expenses
(a)
|
108,720
|
(20,029)
|
88,691
|
|
|
Project Terra costs
and other
|
9,872
|
(9,872)
|
-
|
|
|
Chief Executive
Officer Succession Plan expense, net
|
10,148
|
(10,148)
|
-
|
|
|
Accounting review and
remediation costs, net of insurance proceeds
|
920
|
(920)
|
-
|
|
|
Operating (loss)
income
|
(15,387)
|
45,263
|
29,876
|
|
|
Interest and other
expense (income), net (b)
|
9,190
|
(439)
|
8,751
|
|
|
Provision for income
taxes
|
4,690
|
1,462
|
6,152
|
|
|
Net
(loss) income from continuing operations
|
(29,278)
|
44,240
|
14,962
|
|
|
Net
(loss) income from discontinued operations, net of tax
|
(37,223)
|
37,223
|
-
|
|
|
Net (loss)
income
|
(66,501)
|
81,463
|
14,962
|
|
|
|
|
|
|
|
|
Diluted net (loss)
income per common share from continuing operations
|
(0.28)
|
0.43
|
0.14
|
|
|
Diluted net loss per
common share from discontinued operations
|
(0.36)
|
0.36
|
-
|
|
|
Diluted
net (loss) income per common share
|
(0.64)
|
0.78
|
0.14
|
|
|
|
|
|
|
|
|
Detail of
Adjustments:
|
|
|
|
|
|
|
|
Three Months
Ended
December 31, 2018
|
|
|
|
Warehouse/manufacturing facility start-up
costs
|
|
$
1,708
|
|
|
|
Plant closure related
costs
|
|
1,056
|
|
|
|
SKU
rationalization
|
|
1,530
|
|
|
|
Cost of
sales
|
|
4,294
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
4,294
|
|
|
|
|
|
|
|
|
|
Intangibles
impairment
|
|
17,900
|
|
|
|
Long-lived asset
impairment charge associated with plant closure
|
|
1,573
|
|
|
|
Litigation and
related expenses
|
|
122
|
|
|
|
Plant closure related
costs
|
|
434
|
|
|
|
Operating expenses
(a)
|
|
20,029
|
|
|
|
|
|
|
|
|
|
Project Terra costs
and other
|
|
9,872
|
|
|
|
Project Terra costs
and other
|
|
9,872
|
|
|
|
|
|
|
|
|
|
Chief Executive
Officer Succession Plan expense, net
|
|
10,148
|
|
|
|
Chief Executive
Officer Succession Plan expense, net
|
|
10,148
|
|
|
|
|
|
|
|
|
|
Accounting review and
remediation costs, net of insurance proceeds
|
|
920
|
|
|
|
Accounting review and
remediation costs, net of insurance proceeds
|
|
920
|
|
|
|
|
|
|
|
|
|
Operating (loss)
income
|
|
45,263
|
|
|
|
|
|
|
|
|
|
Unrealized currency
losses/(gains)
|
|
439
|
|
|
|
Interest and other
expense (income), net (b)
|
|
439
|
|
|
|
|
|
|
|
|
|
Income tax related
adjustments
|
|
(1,462)
|
|
|
|
Provision for income
taxes
|
|
(1,462)
|
|
|
|
|
|
|
|
|
|
Net
(loss) income from continuing operations
|
|
$
44,240
|
|
|
|
|
|
|
|
|
|
(a)Operating expenses include amortization
of acquired intangibles, selling, general, and administrative
expenses and long-lived asset and intangibles
impairment.
|
(b)Interest and other expense, net
includes interest and other financing expenses, net and other
expense (income), net.
|
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SOURCE The Hain Celestial Group, Inc.