LAKE SUCCESS, N.Y.,
Aug. 29, 2017 /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 results for the fourth
quarter and fiscal year ended June 30,
2017.
"We are pleased to have achieved sales growth in all of our
business segments on a constant currency basis in the fourth
quarter, despite an ever changing operating environment for food
manufacturers and retailers," said Irwin D.
Simon, Founder, President and Chief Executive Officer of
Hain Celestial. "Building upon our core platforms and cost savings
initiatives, our global team has made significant progress during
the year executing on our strategic plan. The business momentum and
operational improvements we experienced in the fourth quarter of
fiscal 2017 reinforces our confidence in the tremendous
opportunities ahead to generate the growth we know we are capable
of achieving over the next several
years."
Financial Highlights1
Fourth Quarter Fiscal Year 2017
For fourth quarter fiscal
year 2017, the Company reported:
- Net sales of $725.1 million, a 2%
decrease, or a 2% increase on a constant currency basis, compared
to the prior year period. Net sales were impacted by $28.2 million from foreign exchange rate
movements versus the prior year period.
- Operating income of $8.6 million;
adjusted operating income of $67.2
million.
- EBITDA of $82 million compared to
$83 million in the prior year period;
adjusted EBITDA of $86 million
compared to $91 million in the prior
year.
- Earnings per diluted share was breakeven compared to a loss per
diluted share of $0.86 in the prior
year period; adjusted earnings per diluted share of $0.43 was in-line with the prior year period, and
foreign currency exchange rates impacted reported results by
$0.03 per diluted share.
- Strong operating cash flow of $69
million.
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.
Fiscal Year 2017
For fiscal year 2017, the Company
reported:
- Net sales of $2.853 billion, a 1%
decrease, or a 3% increase on a constant currency basis, compared
to fiscal 2016 net sales of $2.885
billion. Net sales were impacted by $124.3 million in foreign exchange rate movements
compared to the prior year.
- Operating income of $111 million;
adjusted operating income of $202
million.
- EBITDA of $239 million compared
to $362 million in the prior year;
adjusted EBITDA of $275 million
compared to $379 million in the prior
year.
- Earnings per diluted share of $0.65 compared to $0.46 in the prior year; adjusted earnings per
diluted share of $1.22 compared to
$1.85 in the prior year, and foreign
currency exchange rates impacted reported results by $0.12 per diluted share.
- Strong operating cash flow of $217
million.
Segment Highlights
Fourth Quarter 2017
Hain
Celestial United States reported net sales of $309.0 million, an increase of 1% on a
year-over-year basis including a $4.5
million impact from product rationalization and $2.9 million in foreign exchange movements driven
by the Ella's Kitchen® brand. Hain Celestial United Kingdom
reported net sales of $194.8 million,
a 10% decrease, compared to the prior year period, or a 3% increase
adjusted for constant currency, acquisitions and
divestitures. Hain Pure Protein reported net sales of
$122.2 million, an 8% increase
compared to the prior year period. Within the Rest of World
segment, Hain Celestial Canada reported net sales of $40.2 million, a 2% increase, or a 7% increase on
a constant currency basis, compared to the prior year period; Hain
Celestial Europe reported net sales of $44.8
million, a 2% increase, or a 5% increase on a constant
currency basis, compared to the prior year period. The
Company had strong brand sales in constant currency during the
fourth quarter led by Earth's Best®, Terra®, Celestial Seasonings®,
Imagine® and FreeBird® in the United
States; Tilda, Ella's Kitchen®, Hartley's®, Linda McCartney's® and New Convent Garden Soup
Co.® in the United Kingdom; Yves
Veggie Cuisine®, Europe's Best®
and Live Clean® in Canada and
Lima® in Europe.
Fiscal Year 2017
Hain Celestial United States reported
net sales of $1.2 billion, a decrease
of 5% on a year-over-year basis including a $60.0 million impact from inventory realignment
of certain customers and product rationalization and $14.0 million in foreign exchange movements
driven by the Ella's Kitchen® brand, which will be reported in the
United Kingdom segment commencing
in fiscal year 2018. Hain Celestial United Kingdom reported
net sales of $768.3 million, a 1%
decrease, compared to the prior year, or a 6% increase adjusted for
constant currency and acquisitions and divestitures. Hain
Pure Protein reported net sales of $509.6
million, a 3.5% increase compared to the prior year. Within
the Rest of World segment, Hain Celestial Canada net sales of
$151.5 million, a 7% increase on an
actual and constant currency basis, compared to the prior year;
Hain Celestial Europe reported net sales of $172.6 million, a 12% increase, or a 14% increase
on a constant currency basis, compared to the prior year. The
Company had strong brand sales in constant currency during the
fiscal year led by Terra®, Celestial Seasonings®, Imagine®, Alba
Botanica®, Jason® and FreeBird® in the
United States; Tilda®, Ella's Kitchen®, Hartley's®,
Linda McCartney's®, New Convent
Garden Soup Co.® and Sun-Pat® in the United Kingdom; Yves Veggie Cuisine®,
Europe's Best® and Live Clean® in
Canada and Lima® in Europe.
Fiscal Year 2017 Achievements
The Company highlighted
several of its achievements during fiscal year 2017, including
executing on its strategic plan initiated in fiscal year 2016 to
drive net sales and margin expansion, as follows:
- Invested in Top Brands and Capabilities Globally
-
- Increased strategic investments and consumer engagement in
brand building assets.
- Enhanced in-market and online retail activation.
- Introduced over 200 new products worldwide.
- Strategic Transactions
-
- Expanded branded portfolio through two strategic acquisitions
in the growing chilled category:
-
- Yorkshire Provender™ under Hain
Daniels and
- Better Bean™ under Cultivate Ventures.
- Entered into strategic joint venture with Future Group in
India.
- Licensed Rosetto® brand to Rosetto Foods LLC, a joint venture
in which the Company holds a minority interest.
- Project Terra
-
- Established new core category platforms:
-
- Better-For-You Baby, Better-For-You Pantry, Better-For-You
Snacking, Fresh Living, Tea, Pure Personal Care and Cultivate
Ventures.
- Implemented stock-keeping unit ("SKU") rationalization,
eliminating $24 million in net sales,
or 20% of the SKUs in the United
States.
- Expanded global cost savings initiative to $350 million through fiscal year 2020 including
annual productivity.
- Enhanced Leadership Team to Deliver Strategic Plan
-
- Strengthened management team with seasoned professionals
including deep consumer products, brand building and natural
product experience as well as financial industry expertise.
Irwin Simon concluded, "We are
well-positioned among some of the fastest growing trends,
categories and channels in consumer products today and are
fortunate to have the financial flexibility to support our future
business growth and capital allocation priorities. We believe
our continued ability to evolve our business as we grow our
organic, natural and better-for-you brands, expand relationships
with new and existing customers and attract new consumers globally,
paired with Project Terra, will fuel our success and create
long-term value for our shareholders."
Fiscal Year 2018 Guidance
The Company provided its
annual guidance for fiscal year 2018:
- Total net sales of $2.967 billion to
$3.036 billion, an increase of approximately 4% to 6% as
compared to fiscal year 2017.
- Adjusted EBITDA of $350 million to $375
million, an increase of approximately 27% to 36% as compared
to fiscal year 2017.
- Adjusted earnings per diluted share of $1.63 to $1.80, an increase of approximately 34%
to 48% as compared to fiscal year 2017.
Guidance, where adjusted, is provided on a non-GAAP basis, which
excludes acquisition-related expenses, integration and
restructuring charges, start-up costs, unrealized net foreign
currency gains or losses, reserves for litigation matters and other
non-recurring items that have been or may be incurred during the
Company's fiscal year 2018, which the Company will continue to
identify as it reports its future financial results. Guidance
excludes the impact of any future acquisitions.
The Company has not reconciled its expected adjusted EBITDA to
net income or adjusted earnings per diluted share to earnings per
share under "Fiscal Year 2018 Guidance" 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.
Segment Results
Effective July
1, 2016, due to changes to the Company's internal management
and reporting structure resulting from the formation of Cultivate
Ventures, certain brands previously included within the United States operating segment were moved
to a new operating segment called Cultivate. As a result, the
Company is now managed in eight operating segments: the United States (excluding Cultivate),
United Kingdom, Tilda, Hain Pure
Protein Corporation, Empire, Canada, Europe and Cultivate. The United States (excluding Cultivate) is its
own reportable segment. Cultivate is now aggregated with
Canada and Europe and reported within the "Rest of
World". There were no changes to the United Kingdom (which includes Tilda) and Hain
Pure Protein (which includes HPPC and Empire) reportable segments.
The prior period segment information contained below has been
adjusted to reflect the Company's new operating and reporting
structure.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited and
dollars in thousands)
|
United
States
|
United
Kingdom
|
Hain Pure
Protein
|
Rest of
World
|
Corporate/
Other
|
Total
|
NET
SALES
|
|
|
|
|
|
|
Net sales - Three
months ended 06/30/17
|
$
308,988
|
$
194,760
|
$
122,193
|
$
99,144
|
$
-
|
$
725,085
|
Net sales - Three
months ended 06/30/16
|
$
306,423
|
$
216,608
|
$
113,050
|
$
101,466
|
$
-
|
$
737,547
|
% change - FY'17 net
sales vs. FY'16 net sales
|
0.8%
|
-10.1%
|
8.1%
|
-2.3%
|
|
-1.7%
|
|
|
|
|
|
|
|
OPERATING
INCOME
|
|
|
|
|
|
|
Three months ended
06/30/17
|
|
|
|
|
|
|
Operating
income
|
$
46,053
|
$
16,957
|
$
1,413
|
$
10,117
|
$
(65,953)
|
$
8,587
|
Non-GAAP Adjustments
(1)
|
-
|
942
|
-
|
-
|
57,661
|
58,603
|
Adjusted operating
income
|
$
46,053
|
$
17,899
|
$
1,413
|
$
10,117
|
$
(8,292)
|
$
67,190
|
Adjusted operating
income margin
|
14.9%
|
9.2%
|
1.2%
|
10.2%
|
|
9.3%
|
Three months ended
06/30/16
|
|
|
|
|
|
|
Operating
income
|
$
54,653
|
$
11,907
|
$
480
|
$
10,252
|
$
(142,430)
|
$
(65,138)
|
Non-GAAP Adjustments
(1)
|
2,967
|
1,062
|
795
|
850
|
131,102
|
136,776
|
Adjusted operating
income
|
$
57,620
|
$
12,969
|
$
1,275
|
$
11,102
|
$
(11,328)
|
$
71,638
|
Adjusted operating
income margin
|
18.8%
|
6.0%
|
1.1%
|
10.9%
|
|
9.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited and
dollars in thousands)
|
United
States
|
United
Kingdom
|
Hain Pure
Protein
|
Rest of
World
|
Corporate/
Other
|
Total
|
NET
SALES
|
|
|
|
|
|
|
Net sales - Twelve
months ended 06/30/17
|
$
1,191,262
|
$
768,301
|
$
509,606
|
$
383,942
|
$
-
|
$
2,853,111
|
Net sales - Twelve
months ended 06/30/16
|
$
1,249,123
|
$
774,877
|
$
492,510
|
$
368,864
|
$
-
|
$
2,885,374
|
% change - FY'17 net
sales vs. FY'16 net sales
|
-4.6%
|
-0.8%
|
3.5%
|
4.1%
|
|
-1.1%
|
|
|
|
|
|
|
|
OPERATING
INCOME
|
|
|
|
|
|
|
Twelve months ended
06/30/17
|
|
|
|
|
|
|
Operating
income
|
$
157,506
|
$
39,749
|
$
1,382
|
$
32,010
|
$
(119,842)
|
$
110,805
|
Non-GAAP Adjustments
(1)
|
6,193
|
4,696
|
-
|
(110)
|
80,402
|
91,181
|
Adjusted operating
income
|
$
163,699
|
$
44,445
|
$
1,382
|
$
31,900
|
$
(39,440)
|
$
201,986
|
Adjusted operating
income margin
|
13.7%
|
5.8%
|
0.3%
|
8.3%
|
|
7.1%
|
Twelve months ended
06/30/16
|
|
|
|
|
|
|
Operating
income
|
$
203,481
|
$
56,000
|
$
31,558
|
$
27,898
|
$
(168,577)
|
$
150,360
|
Non-GAAP Adjustments
(1)
|
5,858
|
2,082
|
4,734
|
1,438
|
141,011
|
155,123
|
Adjusted operating
income
|
$
209,339
|
$
58,082
|
$
36,292
|
$
29,336
|
$
(27,566)
|
$
305,483
|
Adjusted operating
income margin
|
16.8%
|
7.5%
|
7.4%
|
8.0%
|
|
10.6%
|
|
|
|
|
|
|
|
(1) See
accompanying table of "Reconciliation of GAAP Results to Non-GAAP
Measures"
|
Webcasts and Upcoming 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 Company is also scheduled to
present at Barclays Global Consumer Staples Conference on
September 7, 2017 at 10:30 AM Eastern Time. The events will be
webcast and be 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 Celestial Seasonings®, Earth's
Best®, Ella's Kitchen®, Terra®,
Garden of Eatin'®, Sensible Portions®, Health
Valley®, Arrowhead Mills®,
MaraNatha®, SunSpire®, DeBoles®,
Casbah®, Rudi's Organic Bakery®, Hain Pure
Foods®, Spectrum®, Spectrum
Essentials®, Imagine®, Almond
Dream®, Rice Dream®, Soy Dream®,
WestSoy®, The Greek Gods®,
BluePrint®, FreeBird®, Plainville
Farms®, Empire®, Kosher Valley®,
Yves Veggie Cuisine®, Better Bean™, Europe's Best®, Cully &
Sully®, New Covent Garden Soup Co.®,
Yorkshire Provender™, Johnson's Juice Co.®, Farmhouse
Fare®, Hartley's®, Sun-Pat®,
Gale's®, Robertson's®, Frank Cooper's®, Linda McCartney®, Lima®, Danival®,
Joya®, Natumi®, GG UniqueFiber®,
Tilda®, JASON®, Avalon Organics®,
Alba Botanica®, Live
Clean® and Queen
Helene®. Hain Celestial has been providing A
Healthier Way of Life™ since 1993. For more information, visit
www.hain.com.
Safe Harbor Statement
Certain statements contained in
this press release constitute "forward-looking statements" within
the meaning of 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 facts. You can also identify
forward-looking statements by discussions of guidance for the
fiscal year 2018 strategy, plans or intentions related to our
capital resources, performance and results of operations. Such
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 (i) the Company's guidance for Fiscal Year
2018; (ii) the Company's strategic plan including its ability to
generate growth and execution against such plan and (iii) the
Company's ability to deliver significant shareholder value
creation; and the other risks detailed from time-to-time in the
Company's reports filed with the Securities and Exchange
Commission, including the Annual Report on Form 10-K for the fiscal
year ended June 30, 2016, and our
quarterly reports. As a result of the foregoing and other
factors, no assurance can be given as to the 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 excluding the impact of foreign currency, adjusted
operating 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 months and 12
months ended June 30, 2017 and 2016
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 Income
presented in accordance with GAAP.
The Company defines Operating Free Cash Flow as cash provided
from or used in operating activities (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 12 months
ended June 30, 2017 and 2016,
operating free cash flow was calculated as follows:
|
Twelve Months
Ended
|
|
06/30/2017
|
|
06/30/2016
|
|
(unaudited and
dollars in thousands)
|
Cash flow provided by
operating activities
|
$
216,624
|
|
$
206,575
|
Purchase of property,
plant and equipment
|
(63,120)
|
|
(77,284)
|
Operating free cash
flow
|
$
153,504
|
|
$
129,291
|
The Company's operating free cash flow was $153.5 million for the 12 months ended
June 30, 2017, an increase of 19%
from the 12 months ended June 30, 2016.
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 year-to-year
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 defines EBITDA as net income or loss (a GAAP
measure) before income taxes, net interest expense, depreciation
and amortization, equity in net (income) loss of equity method
investees, stock based compensation expense, impairment of long
lived assets and intangibles, goodwill impairment, and unrealized
currency gains and losses. 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 3 months ended June 30,
2017 and 2016 and the 12 months ended June 30, 2017 and 2016, EBITDA and adjusted
EBITDA was calculated as follows:
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
6/30/2017
|
|
6/30/2016
|
|
6/30/2017
|
|
6/30/2016
|
|
(unaudited and
dollars in thousands)
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
313
|
|
$
(88,597)
|
|
$
67,430
|
|
$
47,429
|
Provision for income
taxes
|
2,520
|
|
11,086
|
|
21,842
|
|
70,932
|
Interest expense,
net
|
4,922
|
|
4,866
|
|
18,446
|
|
22,231
|
Depreciation and
amortization
|
17,397
|
|
17,524
|
|
68,697
|
|
65,622
|
Equity in net
(income) loss of equity-method
investees
|
(84)
|
|
(61)
|
|
(129)
|
|
47
|
Stock based
compensation expense
|
2,139
|
|
2,683
|
|
9,658
|
|
12,688
|
Long-lived asset and
tradename impairment
|
40,452
|
|
43,200
|
|
40,452
|
|
43,200
|
Goodwill
impairment
|
-
|
|
84,548
|
|
-
|
|
84,548
|
Unrealized currency
loss
|
14,056
|
|
7,739
|
|
12,570
|
|
14,831
|
EBITDA
|
81,715
|
|
82,988
|
|
238,966
|
|
361,528
|
|
|
|
|
|
|
|
|
Acquisition,
restructuring, integration, severance,
and other charges
|
6,095
|
|
2,156
|
|
9,694
|
|
13,904
|
Chilled desserts
contract related termination
costs
|
2,583
|
|
-
|
|
2,583
|
|
-
|
HPPC production
interruption related to chiller
breakdown and factory start-up costs
|
-
|
|
594
|
|
-
|
|
4,705
|
Inventory costs for
products discontinued or with
redesigned packaging
|
-
|
|
3,050
|
|
5,359
|
|
3,050
|
Costs incurred due to
co-packer default
|
-
|
|
770
|
|
-
|
|
770
|
U.K. deferred
synergies due to CMA Board
decision
|
-
|
|
949
|
|
918
|
|
949
|
U.K. factory start-up
costs
|
-
|
|
-
|
|
-
|
|
743
|
U.S. warehouse
consolidation project
|
-
|
|
197
|
|
-
|
|
623
|
Recall and other
related costs
|
-
|
|
-
|
|
809
|
|
-
|
Accounting review
costs
|
9,473
|
|
-
|
|
29,562
|
|
-
|
Litigation
expenses
|
-
|
|
1,200
|
|
-
|
|
1,200
|
Celestial Seasonings
marketing support and
Keurig transition
|
-
|
|
-
|
|
-
|
|
1,000
|
Tilda fire insurance
recovery costs
|
-
|
|
112
|
|
-
|
|
342
|
Luton closure
costs
|
-
|
|
-
|
|
1,804
|
|
-
|
Gain on Tilda fire
related fixed assets
|
-
|
|
(739)
|
|
-
|
|
(9,752)
|
Realized currency
gain on repayment of GBP
denominated debt
|
(14,290)
|
|
-
|
|
(14,290)
|
|
-
|
Adjusted
EBITDA
|
$
85,576
|
|
$
91,277
|
|
$
275,405
|
|
$
379,062
|
THE HAIN CELESTIAL
GROUP, INC.
|
Consolidated
Balance Sheets
|
(unaudited and
in thousands)
|
|
|
|
|
|
|
|
|
|
June 30,
2017
|
|
June 30,
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
146,992
|
|
$
127,926
|
|
Accounts receivable,
net
|
248,436
|
|
278,933
|
|
Inventories
|
427,308
|
|
408,564
|
|
Prepaid expenses and
other current assets
|
52,045
|
|
84,811
|
|
|
Total current
assets
|
874,781
|
|
900,234
|
|
|
|
|
|
|
Property, plant and
equipment, net
|
370,511
|
|
389,841
|
Goodwill
|
|
1,059,981
|
|
1,060,336
|
Trademarks and other
intangible assets, net
|
573,268
|
|
604,787
|
Investments and joint
ventures
|
18,998
|
|
20,244
|
Other
assets
|
33,565
|
|
32,638
|
|
|
Total
assets
|
$
2,931,104
|
|
$
3,008,080
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts
payable
|
$
222,136
|
|
$
251,712
|
|
Accrued expenses and
other current liabilities
|
108,514
|
|
78,803
|
|
Current portion of
long-term debt
|
9,844
|
|
26,513
|
|
|
Total current
liabilities
|
340,494
|
|
357,028
|
|
|
|
|
|
|
Long-term debt, less
current portion
|
740,304
|
|
836,171
|
Deferred income
taxes
|
121,475
|
|
131,507
|
Other noncurrent
liabilities
|
15,999
|
|
18,860
|
|
|
Total
liabilities
|
1,218,272
|
|
1,343,566
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
Common
stock
|
1,080
|
|
1,075
|
|
Additional paid-in
capital
|
1,137,724
|
|
1,123,206
|
|
Retained
earnings
|
868,822
|
|
801,392
|
|
Accumulated other
comprehensive loss
|
(195,479)
|
|
(172,111)
|
|
Subtotal
|
1,812,147
|
|
1,753,562
|
|
Treasury
stock
|
(99,315)
|
|
(89,048)
|
|
|
Total stockholders'
equity
|
1,712,832
|
|
1,664,514
|
|
|
|
|
|
|
|
|
Total liabilities and
stockholders' equity
|
$
2,931,104
|
|
$
3,008,080
|
THE HAIN CELESTIAL
GROUP, INC.
|
Consolidated
Statements of Income
|
(unaudited and
in thousands, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Twelve Months Ended
June 30,
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
725,085
|
|
$
737,547
|
|
$
2,853,111
|
|
$
2,885,374
|
Cost of
sales
|
|
575,366
|
|
587,466
|
|
2,311,739
|
|
2,271,243
|
Gross
profit
|
|
149,719
|
|
150,081
|
|
541,372
|
|
614,131
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
|
79,033
|
|
80,342
|
|
331,763
|
|
303,763
|
Amortization of
acquired intangibles
|
|
4,438
|
|
4,973
|
|
18,402
|
|
18,869
|
Acquisition related
expenses, restructuring and
integration charges, and other
|
|
7,736
|
|
2,156
|
|
10,388
|
|
13,391
|
Accounting review
costs
|
|
9,473
|
|
-
|
|
29,562
|
|
-
|
Goodwill
impairment
|
|
-
|
|
84,548
|
|
-
|
|
84,548
|
Long-lived asset and
tradename impairment
|
|
40,452
|
|
43,200
|
|
40,452
|
|
43,200
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
8,587
|
|
(65,138)
|
|
110,805
|
|
150,360
|
|
|
|
|
|
|
|
|
|
Interest and other
financing expenses, net
|
|
5,657
|
|
5,474
|
|
21,274
|
|
25,161
|
Other
(income)/expense, net
|
|
181
|
|
7,699
|
|
388
|
|
16,543
|
Gain on fire
insurance recovery
|
|
-
|
|
(739)
|
|
-
|
|
(9,752)
|
|
|
|
|
|
|
|
|
|
Income before income
taxes and equity-method investees
|
|
2,749
|
|
(77,572)
|
|
89,143
|
|
118,408
|
Provision for income
taxes
|
|
2,520
|
|
11,086
|
|
21,842
|
|
70,932
|
Equity in net loss
(income) of equity-method investees
|
|
(84)
|
|
(61)
|
|
(129)
|
|
47
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
$
313
|
|
$
(88,597)
|
|
$
67,430
|
|
$
47,429
|
|
|
|
|
|
|
|
|
|
Net income per common
share:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
-
|
|
$
(0.86)
|
|
$
0.65
|
|
$
0.46
|
Diluted
|
|
$
-
|
|
$
(0.86)
|
|
$
0.65
|
|
$
0.46
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
103,693
|
|
103,453
|
|
103,611
|
|
103,135
|
Diluted
|
|
104,294
|
|
103,453
|
|
104,248
|
|
104,183
|
THE HAIN CELESTIAL
GROUP, INC.
|
Reconciliation of GAAP Results to Non-GAAP
Measures
|
(unaudited and
in thousands, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
|
2017 GAAP
|
Adjustments
|
2017
Adjusted
|
|
2016 GAAP
|
Adjustments
|
2016
Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
725,085
|
$
-
|
$
725,085
|
|
$
737,547
|
$
-
|
$
737,547
|
Cost of
sales
|
|
575,366
|
(942)
|
574,424
|
|
587,466
|
(5,061)
|
582,405
|
Operating expenses
(a)
|
|
123,923
|
(40,452)
|
83,471
|
|
213,063
|
(129,559)
|
83,504
|
Acquisition related
expenses, restructuring and
integration charges, and other
|
|
7,736
|
(7,736)
|
-
|
|
2,156
|
(2,156)
|
-
|
Accounting review
costs
|
|
9,473
|
(9,473)
|
-
|
|
-
|
-
|
-
|
Operating
Income
|
|
8,587
|
58,603
|
67,190
|
|
(65,138)
|
136,776
|
71,638
|
Interest and other
expenses (income), net(b)
|
|
5,838
|
234
|
6,072
|
|
12,434
|
(7,000)
|
5,434
|
Provision for income
taxes
|
|
2,520
|
14,332
|
16,852
|
|
11,086
|
9,844
|
20,930
|
Net income
(loss)
|
|
313
|
44,037
|
44,350
|
|
(88,597)
|
133,932
|
45,335
|
Earnings (loss) per
share - diluted
|
|
-
|
0.42
|
0.43
|
|
(0.86)
|
1.29
|
0.43
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Detail of
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended June 30,
|
|
|
|
Three Months
Ended June 30,
|
|
|
|
|
2017
|
|
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
HPP chiller breakdown
related costs
|
|
|
$
-
|
|
|
|
$
594
|
|
Inventory costs for
products discontinued or having redesigned
packaging
|
|
|
-
|
|
|
|
3,050
|
|
UK deferred synergies
due to CMA Board decision
|
|
|
-
|
|
|
|
450
|
|
Costs incurred due to
co-packer default
|
|
|
-
|
|
|
|
770
|
|
Acquisition related
integration costs
|
|
|
-
|
|
|
|
197
|
|
Chilled desserts
write off of maintenance parts & packaging
|
|
|
942
|
|
|
|
-
|
|
Cost of
sales
|
|
|
942
|
|
|
|
5,061
|
|
|
|
|
|
|
|
|
|
|
UK deferred synergies
due to CMA Board decision
|
|
|
-
|
|
|
|
499
|
|
Tilda fire insurance
recovery costs and other setup/integration
costs
|
|
|
-
|
|
|
|
112
|
|
Litigation
expenses
|
|
|
-
|
|
|
|
1,200
|
|
Goodwill
impairment
|
|
|
-
|
|
|
|
84,548
|
|
Tradename
impairment
|
|
|
14,079
|
|
|
|
39,724
|
|
Fixed asset
impairment
|
|
|
26,373
|
|
|
|
3,476
|
|
Operating Expenses
(a)
|
|
|
40,452
|
|
|
|
129,559
|
|
|
|
|
|
|
|
|
|
|
Acquisition related
expenses, restructuring and
integration charges, and other
|
|
|
7,736
|
|
|
|
2,156
|
|
Acquisition related
expenses, restructuring and
integration charges, and other
|
|
|
7,736
|
|
|
|
2,156
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounting review
costs
|
|
|
9,473
|
|
|
|
-
|
|
Accounting review
costs
|
|
|
9,473
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
|
58,603
|
|
|
|
136,776
|
|
|
|
|
|
|
|
|
|
|
Unrealized currency
loss
|
|
|
14,056
|
|
|
|
7,739
|
|
Realized currency
gain on repayment of GBP denominated
debt
|
|
|
(14,290)
|
|
|
|
-
|
|
Gain on insurance
recovery on Tilda related fixed asset
purchases
|
|
|
-
|
|
|
|
(739)
|
|
Interest and other
expenses (income), net (b)
|
|
|
(234)
|
|
|
|
7,000
|
|
|
|
|
|
|
|
|
|
|
Income tax related
adjustments
|
|
|
14,332
|
|
|
|
9,844
|
|
Provision for income
taxes
|
|
|
14,332
|
|
|
|
9,844
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
$
44,037
|
|
|
|
$
133,932
|
|
|
|
|
|
|
|
|
|
|
(a)Operating expenses include amortization
of acquired intangibles, selling, general, and administrative
expenses and goodwill, long-lived assets and tradename
impairment.
|
(b)Interest and other expenses, net
include interest and other financing expenses, net, other
(income)/expense, net, and gain on fire insurance
recovery.
|
THE HAIN CELESTIAL
GROUP, INC.
|
Reconciliation of GAAP Results to Non-GAAP
Measures
|
(unaudited and
in thousands, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended
June 30,
|
|
|
2017 GAAP
|
Adjustments
|
2017
Adjusted
|
|
2016 GAAP
|
Adjustments
|
2016
Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
2,853,111
|
$
-
|
$
2,853,111
|
|
$
2,885,374
|
$
-
|
$
2,885,374
|
Cost of
sales
|
|
2,311,739
|
(7,205)
|
2,304,534
|
|
2,271,243
|
(10,639)
|
2,260,604
|
Operating expenses
(a)
|
|
390,617
|
(44,026)
|
346,591
|
|
450,380
|
(131,093)
|
319,287
|
Acquisition related
expenses, restructuring and
integration charges, and other
|
|
10,388
|
(10,388)
|
-
|
|
13,391
|
(13,391)
|
-
|
Accounting review
costs
|
|
29,562
|
(29,562)
|
-
|
|
-
|
-
|
-
|
Operating
Income
|
|
110,805
|
91,181
|
201,986
|
|
150,360
|
155,123
|
305,483
|
Interest and other
expenses, net (b)
|
|
21,662
|
1,720
|
23,382
|
|
31,952
|
(5,293)
|
26,659
|
Provision for income
taxes
|
|
21,842
|
29,883
|
51,725
|
|
70,932
|
14,958
|
85,890
|
Net income
|
|
67,430
|
59,578
|
127,008
|
|
47,429
|
145,458
|
192,887
|
Earnings per share -
diluted
|
|
0.65
|
0.57
|
1.22
|
|
0.46
|
1.40
|
1.85
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Detail of
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months
Ended June 30,
|
|
|
|
Twelve Months
Ended June 30,
|
|
|
|
|
FY 2017
|
|
|
|
FY 2016
|
|
|
|
|
|
|
|
|
|
|
HPPC production
interruption related to chiller breakdown and
factory start up costs
|
|
|
$
-
|
|
|
|
$
4,489
|
|
UK factory start up
costs
|
|
|
-
|
|
|
|
743
|
|
US warehouse
consolidation
|
|
|
-
|
|
|
|
426
|
|
Inventory costs for
products discontinued or having redesigned
packaging
|
|
|
5,359
|
|
|
|
3,050
|
|
Recall and other
costs
|
|
|
73
|
|
|
|
-
|
|
UK deferred synergies
due to CMA Board decision
|
|
|
367
|
|
|
|
450
|
|
Luton closure
costs
|
|
|
464
|
|
|
|
-
|
|
Costs incurred due to
co-packer default
|
|
|
-
|
|
|
|
770
|
|
Acquisition related
integration costs
|
|
|
-
|
|
|
|
711
|
|
Chilled desserts
write off of maintenance parts & packaging
|
|
|
942
|
|
|
|
-
|
|
Cost of
sales
|
|
|
7,205
|
|
|
|
10,639
|
|
|
|
|
|
|
|
|
|
|
Luton closure
costs
|
|
|
1,340
|
|
|
|
-
|
|
Tilda fire insurance
recovery costs and other
|
|
|
947
|
|
|
|
342
|
|
UK deferred synergies
due to CMA Board decision
|
|
|
551
|
|
|
|
499
|
|
Recall and other
costs
|
|
|
736
|
|
|
|
-
|
|
Keurig
transition
|
|
|
-
|
|
|
|
1,304
|
|
Litigation
expenses
|
|
|
-
|
|
|
|
1,200
|
|
Goodwill
impairment
|
|
|
-
|
|
|
|
84,548
|
|
Tradename
impairment
|
|
|
14,079
|
|
|
|
39,724
|
|
Fixed asset
impairment
|
|
|
26,373
|
|
|
|
3,476
|
|
Operating Expenses
(a)
|
|
|
44,026
|
|
|
|
131,093
|
|
|
|
|
|
|
|
|
|
|
Acquisition related
expenses, restructuring and
integration charges, and other
|
|
|
10,388
|
|
|
|
13,391
|
|
Acquisition related
expenses, restructuring and
integration charges, and other
|
|
|
10,388
|
|
|
|
13,391
|
|
|
|
|
|
|
|
|
|
|
Accounting review
costs
|
|
|
29,562
|
|
|
|
-
|
|
Accounting review
costs
|
|
|
29,562
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
|
91,181
|
|
|
|
155,123
|
|
|
|
|
|
|
|
|
|
|
Unrealized currency
loss
|
|
|
12,570
|
|
|
|
14,831
|
|
Realized currency
gain on repayment of GBP denominated debt
|
|
|
(14,290)
|
|
|
|
-
|
|
Gain on insurance
recovery on Tilda related fixed asset
purchases
|
|
|
-
|
|
|
|
(9,752)
|
|
HPP chiller
disposal
|
|
|
-
|
|
|
|
214
|
|
Interest and other
expenses, net (b)
|
|
|
(1,720)
|
|
|
|
5,293
|
|
|
|
|
|
|
|
|
|
|
Income tax related
adjustments
|
|
|
29,883
|
|
|
|
14,958
|
|
Provision for income
taxes
|
|
|
29,883
|
|
|
|
14,958
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
$
59,578
|
|
|
|
$
145,458
|
|
|
|
|
|
|
|
|
|
|
(a)Operating expenses include amortization
of acquired intangibles, selling, general, and administrative
expenses and goodwill, long-lived assets and tradename
impairment.
|
(b)Interest and other expenses, net
include interest and other financing expenses, net, other
(income)/expense, net, and gain on fire insurance
recovery.
|
THE HAIN CELESTIAL
GROUP, INC.
|
(unaudited and in
thousands)
|
|
|
|
|
|
|
|
|
|
|
Net Sales Growth
at Constant Currency:
|
|
Hain
Consolidated
|
|
United
States
|
|
United
Kingdom
|
|
Canada
|
|
Europe
|
Net sales -
Three months ended 06/30/17
|
$
725,085
|
|
$
308,988
|
|
$
194,760
|
|
$
40,239
|
|
$
44,774
|
Impact of
foreign currency exchange
|
28,169
|
|
2,899
|
|
22,292
|
|
1,731
|
|
1,247
|
|
$
753,254
|
|
$
311,887
|
|
$
217,052
|
|
$
41,970
|
|
$
46,021
|
|
|
|
|
|
|
|
|
|
|
Net sales - Three
months ended 06/30/16
|
$
737,547
|
|
$
306,423
|
|
$
216,608
|
|
$
39,289
|
|
$
43,743
|
|
2.1%
|
|
1.8%
|
|
0.2%
|
|
6.8%
|
|
5.2%
|
|
|
|
|
|
|
|
|
|
|
|
Hain
Consolidated
|
|
United
States
|
|
United
Kingdom
|
|
Canada
|
|
Europe
|
Net sales -
Twelve months ended 06/30/17
|
$
2,853,111
|
|
$
1,191,262
|
|
$
768,301
|
|
$
151,456
|
|
$
172,604
|
Impact of
foreign currency exchange
|
124,319
|
|
14,032
|
|
106,650
|
|
303
|
|
3,334
|
|
$
2,977,430
|
|
$
1,205,294
|
|
$
874,951
|
|
$
151,759
|
|
$
175,938
|
|
|
|
|
|
|
|
|
|
|
Net sales - Twelve
months ended 06/30/16
|
$
2,885,374
|
|
$
1,249,123
|
|
$
774,877
|
|
$
141,851
|
|
$
154,589
|
|
3.2%
|
|
-3.5%
|
|
12.9%
|
|
7.0%
|
|
13.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Sales Growth
at Constant Currency and Adjusted for
Acquisitions/Divestitures:
|
|
|
|
|
|
|
|
|
|
|
|
United
Kingdom
|
|
|
|
|
|
|
Net sales on a
constant currency basis - Three months
ended 06/30/17
|
$
217,052
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales - Three
months ended 06/30/16
|
$
216,608
|
|
|
|
|
|
|
|
|
Acquisitions
|
1,175
|
|
|
|
|
|
|
|
|
Divestitures
|
(7,188)
|
|
|
|
|
|
|
|
|
|
$
210,595
|
|
|
|
|
|
|
|
|
|
3.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
United
Kingdom
|
|
|
|
|
|
|
|
|
Net sales on a
constant currency basis - Twelve months
ended 06/30/17
|
$
874,951
|
|
|
|
|
|
|
|
|
Impact of
foreign currency exchange on acquisitions
|
15,804
|
|
|
|
|
|
|
|
|
|
$
890,755
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales - Twelve
months ended 06/30/16
|
$
774,877
|
|
|
|
|
|
|
|
|
Acquisitions
|
86,190
|
|
|
|
|
|
|
|
|
Divestitures
|
(21,024)
|
|
|
|
|
|
|
|
|
|
$
840,043
|
|
|
|
|
|
|
|
|
|
6.0%
|
|
|
|
|
|
|
|
|
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SOURCE The Hain Celestial Group, Inc.