Prestige Consumer Healthcare Inc. (NYSE:PBH) today reported
financial results for its second quarter and first six months ended
September 30, 2023.
“Our second quarter results build on a strong first quarter
performance thanks to our diverse and leading portfolio of brands
and broad distribution. This stable top-line performance was
amplified by our strong financial model and resulted in second
quarter mid-single-digit earnings growth versus prior year. The
earnings growth translated into robust free cash flow that we used
for debt reduction and resulting leverage which will enable further
disciplined capital deployment,” said Ron Lombardi, Chief Executive
Officer of Prestige Consumer Healthcare.
Second Fiscal Quarter Ended September 30,
2023
Reported revenues in the second quarter of fiscal 2024 of $286.3
million compared to a record $289.3 million in the second quarter
of fiscal 2023. Revenues decreased 0.7% versus the prior year
second quarter excluding the impact of foreign currency. The
revenue performance for the quarter was led by Cough & Cold and
Ear & Eye Care category performances in North America and
strong International OTC segment growth versus the prior year
comparable period, offset by declines in certain other categories
and the planned strategic exit of private label revenues.
Reported net income for the second quarter of fiscal 2024
totaled $53.6 million, compared to the prior year second quarter’s
net income of $51.0 million. Diluted earnings per share of $1.07
for the second quarter of fiscal 2024 increased 5.4% versus $1.02
in the prior year comparable period.
Six Months Ended September 30, 2023
Reported revenues for the first six months of fiscal 2024
totaled $565.6 million and compared to revenues of $566.3 million
for the first six months of fiscal 2023. Revenues increased 0.5%
versus the prior year six-month period, excluding the impact of
foreign currency. The revenue growth for the first six months was
driven by International OTC segment performance and strong
Dermatological category sales in North America, offset by lower
Women’s Health category sales and the strategic exit of private
label revenues.
Reported net income for the first six months of fiscal 2024
totaled $106.8 million versus the prior year comparable period net
income of $106.3 million. Diluted earnings per share were $2.13 for
the first six months of fiscal 2024 increased compared to diluted
earnings per share of $2.11 in the prior year comparable
period.
Free Cash Flow and Balance Sheet
The Company's net cash provided by operating activities for the
second quarter fiscal 2024 was $62.5 million, compared to $57.5
million during the prior year comparable period. Non-GAAP free cash
flow in the second quarter of fiscal 2024 was $59.5 million
compared to $55.2 million in the prior year second quarter. The
Company's net cash provided by operating activities for the first
six months of fiscal 2024 was $110.5 million, compared to $115.8
million during the prior year comparable period. Non-GAAP free cash
flow in the first six months of fiscal 2024 was $106.1 million
compared to $112.4 million in the prior year comparable period,
with the change attributable to the timing of working capital.
In the first quarter fiscal 2024, the Company repurchased
approximately 0.4 million shares at a total investment of $25.0
million, completing its previously authorized share repurchase
program.
The Company's net debt position as of September 30, 2023 was
approximately $1.2 billion, resulting in a covenant-defined
leverage ratio of 3.0x.
Segment Review
North American OTC Healthcare: Segment revenues of $244.4
million for the second quarter fiscal 2024 decreased 3.0% compared
to the prior year comparable quarter's record segment revenues of
$252.1 million. The revenue performance for the quarter was driven
by lower sales in Women’s Health and certain other categories as
well as the strategic exit of private label, partially offset by
strong performance in the Cough & Cold and Ear & Eye Care
categories.
For the first six months of the current fiscal year, reported
revenues for the North American OTC segment were $490.6 million,
which compared to $494.6 million in the prior year comparable
period. The change was attributable to lower sales in the Women’s
Health category, partially offset by higher sales in other
categories including Dermatologicals, Ear & Eye Care, and
Gastrointestinal.
International OTC Healthcare: Fiscal second quarter 2024 segment
revenues were $41.9 million compared to $37.2 million reported in
the prior year comparable period. The increase in revenue versus
the prior year second quarter was driven by strong Eye & Ear
Care and Women’s Health sales, partially offset by a $0.7 million
currency headwind.
For the first six months of the current fiscal year, reported
revenues for the International OTC Healthcare segment were $75.1
million, an increase of approximately 5% over the prior year
comparable period’s revenues of $71.8 million or an increase of
8.5% after excluding the impact a $2.6M foreign currency headwind.
The strong sales growth exceeded the Company’s long-term growth
expectation for the segment.
Commentary Reaffirming Outlook for Fiscal
2024
Ron Lombardi, Chief Executive Officer, stated, “We were pleased
with our top-line performance against a record result in Q2 of the
prior year. This was driven by our continued brand-building efforts
and growth in multiple categories including Cough & Cold and
Ear & Eye Care as well as our International segment. The
resulting strong profitability and free cash flow enabled our
continued disciplined capital deployment, which reduced debt by $55
million in the quarter and improved our leverage to 3.0x and the
end of September.”
“Looking ahead, we are reaffirming our fiscal 2024 outlook that
includes solid sales and earnings growth expectations. While we
anticipate a continued dynamic macro environment, our diverse
portfolio of brands in a resilient needs-based section of the store
leave us well positioned to continue to create long-term
shareholder value,” Mr. Lombardi concluded.
|
Reaffirmed Fiscal 2024 Outlook |
|
Revenue |
$1,135 to $1,140 million |
|
Organic Revenue Growth |
1% to 2% |
|
Diluted E.P.S. |
$4.27 to $4.32 |
|
Free Cash Flow |
$240 million or more |
|
|
|
|
Fiscal Second Quarter 2024 Conference Call, Accompanying
Slide Presentation and Replay
The Company will host a conference call to review its second
quarter fiscal 2024 results today, November 2, 2023 at 8:30 a.m.
ET. The Company provides a live Internet webcast, a slide
presentation to accompany the call, as well as an archived replay,
all of which can be accessed from the Investor Relations page of
the Company's website at www.prestigeconsumerhealthcare.com. To
participate in the conference call via phone, participants may
register for the call here to receive dial-in details and a
unique pin. While not required, it is recommended to join 10
minutes prior to the event start. The slide presentation can be
accessed from the Investor Relations page of the website by
clicking on Webcasts and Presentations.
A conference call replay will be available for approximately one
week following completion of the live call and can be accessed on
the Company’s Investor Relations page.
Non-GAAP and Other Financial InformationIn
addition to financial results reported in accordance with generally
accepted accounting principles (GAAP), we have provided certain
non-GAAP financial information in this release to aid investors in
understanding the Company's performance. Each non-GAAP financial
measure is defined and reconciled to its most closely related GAAP
financial measure in the “About Non-GAAP Financial Measures”
section at the end of this earnings release.
Note Regarding Forward-Looking Statements This
news release contains "forward-looking statements" within the
meaning of the federal securities laws that are intended to qualify
for the Safe Harbor from liability established by the Private
Securities Litigation Reform Act of 1995. "Forward-looking
statements" generally can be identified by the use of
forward-looking terminology such as "outlook," "projected," "may,"
"will," "would," "expect," "anticipate," or "continue" (or the
negative or other derivatives of each of these terms) or similar
terminology. The "forward-looking statements" include, without
limitation, statements regarding the Company's future operating
results including revenues, organic growth, diluted earnings per
share, and free cash flow, the Company’s disciplined capital
deployment, the Company’s brand-building efforts, the impact of the
macro environment, and the Company’s ability to create shareholder
value. These statements are based on management’s estimates and
assumptions with respect to future events and financial performance
and are believed to be reasonable, though are inherently uncertain
and difficult to predict. Actual results could differ materially
from those expected as a result of a variety of factors, including
the impact of business and economic conditions, including as a
result of labor shortages, inflation and geopolitical instability,
consumer trends, the impact of the Company’s advertising and
marketing and new product development initiatives, customer
inventory management initiatives, fluctuating foreign exchange
rates, competitive pressures, and the ability of the Company’s
manufacturing operations and third party manufacturers and
logistics providers and suppliers to meet demand for its products
and to avoid inflationary cost increases and disruption as a result
of labor shortages. A discussion of other factors that could cause
results to vary is included in the Company’s Annual Report on Form
10-K for the year ended March 31, 2023 and other periodic reports
filed with the Securities and Exchange Commission.
About Prestige Consumer Healthcare Inc.Prestige
Consumer Healthcare is a leading consumer healthcare products
company with sales throughout the U.S. and Canada, Australia, and
in certain other international markets. The Company’s diverse
portfolio of brands include Monistat® and Summer’s Eve® women’s
health products, BC® and Goody's® pain relievers, Clear Eyes® and
TheraTears® eye care products, DenTek® specialty oral care
products, Dramamine® motion sickness treatments, Fleet® enemas and
glycerin suppositories, Chloraseptic® and Luden’s® sore throat
treatments and drops, Compound W® wart treatments, Little Remedies®
pediatric over-the-counter products, Boudreaux’s Butt Paste® diaper
rash ointments, Nix® lice treatment, Debrox® earwax remover,
Gaviscon® antacid in Canada, and Hydralyte® rehydration products
and the Fess® line of nasal and sinus care products in Australia.
Visit the Company’s website at
www.prestigeconsumerhealthcare.com.
Investor Relations ContactPhil Terpolilli, CFA,
914-524-6819irinquiries@prestigebrands.com
Prestige Consumer Healthcare Inc. |
Condensed Consolidated Statements of Income and
Comprehensive Income |
(Unaudited) |
|
|
Three Months Ended September 30, |
|
Six Months Ended September 30, |
(In thousands, except per share data) |
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Total Revenues |
$ |
286,316 |
|
|
$ |
289,273 |
|
|
$ |
565,625 |
|
|
$ |
566,332 |
|
|
|
|
|
|
|
|
|
Cost of Sales |
|
|
|
|
|
|
|
Cost of sales excluding depreciation |
|
124,324 |
|
|
|
126,384 |
|
|
|
246,978 |
|
|
|
241,380 |
|
Cost of sales depreciation |
|
1,972 |
|
|
|
1,880 |
|
|
|
3,954 |
|
|
|
3,824 |
|
Cost of sales |
|
126,296 |
|
|
|
128,264 |
|
|
|
250,932 |
|
|
|
245,204 |
|
Gross profit |
|
160,020 |
|
|
|
161,009 |
|
|
|
314,693 |
|
|
|
321,128 |
|
|
|
|
|
|
|
|
|
Operating Expenses |
|
|
|
|
|
|
|
Advertising and marketing |
|
40,102 |
|
|
|
43,819 |
|
|
|
76,333 |
|
|
|
83,770 |
|
General and administrative |
|
25,997 |
|
|
|
26,438 |
|
|
|
53,684 |
|
|
|
53,152 |
|
Depreciation and amortization |
|
5,671 |
|
|
|
6,368 |
|
|
|
11,232 |
|
|
|
12,808 |
|
Total operating expenses |
|
71,770 |
|
|
|
76,625 |
|
|
|
141,249 |
|
|
|
149,730 |
|
Operating income |
|
88,250 |
|
|
|
84,384 |
|
|
|
173,444 |
|
|
|
171,398 |
|
|
|
|
|
|
|
|
|
Other expense |
|
|
|
|
|
|
|
Interest expense, net |
|
17,606 |
|
|
|
16,979 |
|
|
|
35,325 |
|
|
|
32,271 |
|
Other (income) expense, net |
|
229 |
|
|
|
812 |
|
|
|
(1,009 |
) |
|
|
1,637 |
|
Total other expense, net |
|
17,835 |
|
|
|
17,791 |
|
|
|
34,316 |
|
|
|
33,908 |
|
Income before income taxes |
|
70,415 |
|
|
|
66,593 |
|
|
|
139,128 |
|
|
|
137,490 |
|
Provision for income taxes |
|
16,856 |
|
|
|
15,570 |
|
|
|
32,293 |
|
|
|
31,195 |
|
Net income |
$ |
53,559 |
|
|
$ |
51,023 |
|
|
$ |
106,835 |
|
|
$ |
106,295 |
|
|
|
|
|
|
|
|
|
Earnings per share: |
|
|
|
|
|
|
|
Basic |
$ |
1.08 |
|
|
$ |
1.02 |
|
|
$ |
2.15 |
|
|
$ |
2.12 |
|
Diluted |
$ |
1.07 |
|
|
$ |
1.02 |
|
|
$ |
2.13 |
|
|
$ |
2.11 |
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding: |
|
|
|
|
|
|
|
Basic |
|
49,687 |
|
|
|
49,804 |
|
|
|
49,727 |
|
|
|
50,033 |
|
Diluted |
|
50,081 |
|
|
|
50,265 |
|
|
|
50,138 |
|
|
|
50,496 |
|
|
|
|
|
|
|
|
|
Comprehensive income, net of tax: |
|
|
|
|
|
|
|
Currency translation adjustments |
|
(3,784 |
) |
|
|
(7,118 |
) |
|
|
(4,430 |
) |
|
|
(16,637 |
) |
Net loss on termination of pension plan |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(790 |
) |
Total other comprehensive loss |
|
(3,784 |
) |
|
|
(7,118 |
) |
|
|
(4,430 |
) |
|
|
(17,427 |
) |
Comprehensive income |
$ |
49,775 |
|
|
$ |
43,905 |
|
|
$ |
102,405 |
|
|
$ |
88,868 |
|
Prestige Consumer Healthcare Inc. |
Condensed Consolidated Balance Sheets |
(Unaudited) |
|
(In
thousands) |
September 30, 2023 |
|
March 31, 2023 |
|
|
|
|
Assets |
|
|
|
Current assets |
|
|
|
Cash and cash equivalents |
$ |
60,067 |
|
$ |
58,489 |
Accounts receivable, net of allowance of $21,994 and $20,205,
respectively |
|
158,456 |
|
|
167,016 |
Inventories |
|
161,283 |
|
|
162,121 |
Prepaid expenses and other current assets |
|
8,392 |
|
|
4,117 |
Total current assets |
|
388,198 |
|
|
391,743 |
|
|
|
|
Property, plant and equipment, net |
|
70,700 |
|
|
70,412 |
Operating lease right-of-use assets |
|
12,134 |
|
|
14,923 |
Finance lease right-of-use assets, net |
|
2,870 |
|
|
4,200 |
Goodwill |
|
526,860 |
|
|
527,553 |
Intangible assets, net |
|
2,328,250 |
|
|
2,341,893 |
Other long-term assets |
|
3,862 |
|
|
3,005 |
Total Assets |
$ |
3,332,874 |
|
$ |
3,353,729 |
|
|
|
|
Liabilities and Stockholders' Equity |
|
|
|
Current liabilities |
|
|
|
Accounts payable |
|
44,381 |
|
|
62,743 |
Accrued interest payable |
|
15,635 |
|
|
15,688 |
Operating lease liabilities, current portion |
|
6,732 |
|
|
6,926 |
Finance lease liabilities, current portion |
|
2,876 |
|
|
2,834 |
Other accrued liabilities |
|
60,080 |
|
|
72,524 |
Total current liabilities |
|
129,704 |
|
|
160,715 |
|
|
|
|
Long-term debt, net |
|
1,262,972 |
|
|
1,345,788 |
Deferred income tax liabilities |
|
388,481 |
|
|
380,434 |
Long-term operating lease liabilities, net of current portion |
|
6,644 |
|
|
9,876 |
Long-term finance lease liabilities, net of current portion |
|
218 |
|
|
1,667 |
Other long-term liabilities |
|
8,896 |
|
|
8,165 |
Total Liabilities |
|
1,796,915 |
|
|
1,906,645 |
|
|
|
|
Total Stockholders' Equity |
|
1,535,959 |
|
|
1,447,084 |
Total Liabilities and Stockholders' Equity |
$ |
3,332,874 |
|
$ |
3,353,729 |
Prestige Consumer Healthcare Inc. |
Condensed Consolidated Statements of Cash
Flows |
(Unaudited) |
|
|
Six Months Ended September 30, |
(In thousands) |
|
2023 |
|
|
|
2022 |
|
Operating Activities |
|
|
|
Net
income |
$ |
106,835 |
|
|
$ |
106,295 |
|
Adjustments to reconcile net income to net cash provided by
operating activities: |
|
|
|
Depreciation and amortization |
|
15,186 |
|
|
|
16,632 |
|
Loss on disposal of property and equipment |
|
191 |
|
|
|
94 |
|
Deferred income taxes |
|
9,721 |
|
|
|
4,211 |
|
Amortization of debt origination costs |
|
2,302 |
|
|
|
1,798 |
|
Stock-based compensation costs |
|
7,834 |
|
|
|
7,323 |
|
Non-cash operating lease cost |
|
2,816 |
|
|
|
2,984 |
|
Other |
|
— |
|
|
|
447 |
|
Changes in operating assets and liabilities: |
|
|
|
Accounts receivable |
|
4,415 |
|
|
|
(8,276 |
) |
Inventories |
|
223 |
|
|
|
(21,810 |
) |
Prepaid expenses and other current assets |
|
(3,814 |
) |
|
|
(1,501 |
) |
Accounts payable |
|
(18,820 |
) |
|
|
1,016 |
|
Accrued liabilities |
|
(11,764 |
) |
|
|
9,788 |
|
Operating lease liabilities |
|
(3,493 |
) |
|
|
(3,201 |
) |
Other |
|
(1,085 |
) |
|
|
(13 |
) |
Net cash provided by operating activities |
|
110,547 |
|
|
|
115,787 |
|
|
|
|
|
Investing Activities |
|
|
|
Purchases of property, plant and equipment |
|
(4,411 |
) |
|
|
(3,423 |
) |
Other |
|
3,800 |
|
|
|
— |
|
Net cash provided by (used in) investing activities |
|
(611 |
) |
|
|
(3,423 |
) |
|
|
|
|
Financing Activities |
|
|
|
Term loan repayments |
|
(85,000 |
) |
|
|
(40,000 |
) |
Borrowings under revolving credit agreement |
|
— |
|
|
|
20,000 |
|
Repayments under revolving credit agreement |
|
— |
|
|
|
(20,000 |
) |
Payments of finance leases |
|
(1,403 |
) |
|
|
(1,369 |
) |
Proceeds from exercise of stock options |
|
9,183 |
|
|
|
1,489 |
|
Fair value of shares surrendered as payment of tax withholding |
|
(5,508 |
) |
|
|
(5,450 |
) |
Repurchase of common stock |
|
(25,000 |
) |
|
|
(50,000 |
) |
Net cash used in financing activities |
|
(107,728 |
) |
|
|
(95,330 |
) |
|
|
|
|
Effects of exchange rate changes on cash and cash equivalents |
|
(630 |
) |
|
|
(1,777 |
) |
Increase (decrease) in cash and cash equivalents |
|
1,578 |
|
|
|
15,257 |
|
Cash and cash equivalents - beginning of period |
|
58,489 |
|
|
|
27,185 |
|
Cash and cash equivalents - end of period |
$ |
60,067 |
|
|
$ |
42,442 |
|
Interest paid |
$ |
33,706 |
|
|
$ |
19,016 |
|
Income taxes paid |
$ |
25,118 |
|
|
$ |
15,689 |
|
Prestige Consumer Healthcare Inc. |
Condensed Consolidated Statements of Income |
Business Segments |
(Unaudited) |
|
|
Three Months Ended September 30, 2023 |
(In thousands) |
North American OTCHealthcare |
|
International OTCHealthcare |
|
Consolidated |
Total segment revenues* |
$ |
244,423 |
|
$ |
41,893 |
|
$ |
286,316 |
Cost of sales |
|
107,466 |
|
|
18,830 |
|
|
126,296 |
Gross profit |
|
136,957 |
|
|
23,063 |
|
|
160,020 |
Advertising and marketing |
|
35,389 |
|
|
4,713 |
|
|
40,102 |
Contribution margin |
$ |
101,568 |
|
$ |
18,350 |
|
$ |
119,918 |
Other operating expenses |
|
|
|
|
|
31,668 |
Operating income |
|
|
|
|
$ |
88,250 |
|
|
|
|
|
|
*Intersegment revenues of $0.6 million were eliminated from the
North American OTC Healthcare segment. |
|
Six Months Ended September 30, 2023 |
(In thousands) |
North American OTC Healthcare |
|
International OTC Healthcare |
|
Consolidated |
Total segment revenues* |
$ |
490,566 |
|
$ |
75,059 |
|
$ |
565,625 |
Cost of sales |
|
217,542 |
|
|
33,390 |
|
|
250,932 |
Gross profit |
|
273,024 |
|
|
41,669 |
|
|
314,693 |
Advertising and marketing |
|
66,790 |
|
|
9,543 |
|
|
76,333 |
Contribution margin |
$ |
206,234 |
|
$ |
32,126 |
|
$ |
238,360 |
Other operating expenses |
|
|
|
|
|
64,916 |
Operating income |
|
|
|
|
$ |
173,444 |
|
*Intersegment revenues of $2.0 million were eliminated from the
North American OTC Healthcare segment. |
|
Three Months Ended September 30, 2022 |
(In thousands) |
North American OTC Healthcare |
|
International OTC Healthcare |
|
Consolidated |
Total segment revenues* |
$ |
252,054 |
|
$ |
37,219 |
|
$ |
289,273 |
Cost of sales |
|
113,533 |
|
|
14,731 |
|
|
128,264 |
Gross profit |
|
138,521 |
|
|
22,488 |
|
|
161,009 |
Advertising and marketing |
|
39,316 |
|
|
4,503 |
|
|
43,819 |
Contribution margin |
$ |
99,205 |
|
$ |
17,985 |
|
$ |
117,190 |
Other operating expenses |
|
|
|
|
|
32,806 |
Operating income |
|
|
|
|
$ |
84,384 |
|
*
Intersegment revenues of $1.1 million were eliminated from the
North American OTC Healthcare segment. |
|
Six Months Ended September 30, 2022 |
(In thousands) |
North American OTC Healthcare |
|
International OTC Healthcare |
|
Consolidated |
Total segment revenues* |
$ |
494,572 |
|
$ |
71,760 |
|
$ |
566,332 |
Cost of sales |
|
216,454 |
|
|
28,750 |
|
|
245,204 |
Gross profit |
|
278,118 |
|
|
43,010 |
|
|
321,128 |
Advertising and marketing |
|
74,728 |
|
|
9,042 |
|
|
83,770 |
Contribution margin |
$ |
203,390 |
|
$ |
33,968 |
|
$ |
237,358 |
Other operating expenses |
|
|
|
|
|
65,960 |
Operating income |
|
|
|
|
$ |
171,398 |
|
*
Intersegment revenues of $1.7 million were eliminated from the
North American OTC Healthcare segment. |
|
About Non-GAAP Financial Measures
In addition to financial results reported in
accordance with GAAP, we disclose certain Non-GAAP financial
measures ("NGFMs"), including, but not limited to, Non-GAAP Organic
Revenues, Non-GAAP Organic Revenue Change Percentage, Non-GAAP
EBITDA, Non-GAAP EBITDA Margin, Non-GAAP Free Cash Flow, and Net
Debt.
We use these NGFMs internally, along with GAAP
information, in evaluating our operating performance and in making
financial and operational decisions. We believe that the
presentation of these NGFMs provides investors with greater
transparency, and provides a more complete understanding of our
business than could be obtained absent these disclosures, because
the supplemental data relating to our financial condition and
results of operations provides additional ways to view our
operation when considered with both our GAAP results and the
reconciliations below. In addition, we believe that the
presentation of each of these NGFMs is useful to investors for
period-to-period comparisons of results in assessing shareholder
value, and we use these NGFMs internally to evaluate the
performance of our personnel and also to evaluate our operating
performance and compare our performance to that of our
competitors.
These NGFMs are not in accordance with GAAP,
should not be considered as a measure of profitability or
liquidity, and may not be directly comparable to similarly titled
NGFMs reported by other companies. These NGFMs have limitations and
they should not be considered in isolation from or as an
alternative to their most closely related GAAP measures reconciled
below. Investors should not rely on any single financial measure
when evaluating our business. We recommend investors review the
GAAP financial measures included in this earnings release. When
viewed in conjunction with our GAAP results and the reconciliations
below, we believe these NGFMs provide greater transparency and a
more complete understanding of factors affecting our business than
GAAP measures alone.
NGFMs Defined
We define our NGFMs presented herein as
follows:
- Non-GAAP Organic Revenues: GAAP
Total Revenues excluding the impact of foreign currency exchange
rates in the periods presented.
- Non-GAAP Organic Revenue Change
Percentage: Calculated as the change in Non-GAAP Organic Revenues
from prior year divided by prior year Non-GAAP Organic
Revenues.
- Non-GAAP EBITDA: GAAP Net Income
before interest expense, net, provision for income taxes, and
depreciation and amortization.
- Non-GAAP EBITDA Margin: Calculated
as Non-GAAP EBITDA divided by GAAP Total Revenues.
- Non-GAAP Free Cash Flow: Calculated
as GAAP Net cash provided by operating activities less cash paid
for capital expenditures.
- Net Debt: Calculated as total
principal amount of debt outstanding ($1,275,000 at
September 30, 2023) less cash and cash equivalents ($60,067 at
September 30, 2023). Amounts in thousands.
The following tables set forth the
reconciliations of each of our NGFMs (other than Net Debt, which is
reconciled above) to their most directly comparable financial
measures presented in accordance with GAAP.
Reconciliation of GAAP Total Revenues to Non-GAAP
Organic Revenues and related Non-GAAP Organic Revenue Change
percentage:
|
Three Months Ended September 30, |
|
Six Months Ended September 30, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
(In thousands) |
|
|
|
|
|
|
|
GAAP Total Revenues |
$ |
286,316 |
|
|
$ |
289,273 |
|
|
$ |
565,625 |
|
|
$ |
566,332 |
|
Revenue Change |
|
(1.0 |
)% |
|
|
|
|
(0.1 |
)% |
|
|
Adjustments: |
|
|
|
|
|
|
|
Impact of foreign currency exchange rates |
|
— |
|
|
|
(1,035 |
) |
|
|
— |
|
|
|
(3,759 |
) |
Total adjustments |
|
— |
|
|
|
(1,035 |
) |
|
|
— |
|
|
|
(3,759 |
) |
Non-GAAP Organic Revenues |
$ |
286,316 |
|
|
$ |
288,238 |
|
|
$ |
565,625 |
|
|
$ |
562,573 |
|
Non-GAAP Organic Revenue Change |
|
(0.7 |
)% |
|
|
|
|
0.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP Net Income to Non-GAAP EBITDA and
related Non-GAAP EBITDA Margin:
|
Three Months Ended September 30, |
|
Six Months Ended September 30, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
(In thousands) |
|
|
|
|
|
|
|
GAAP Net Income |
$ |
53,559 |
|
|
$ |
51,023 |
|
|
$ |
106,835 |
|
|
$ |
106,295 |
|
Interest expense, net |
|
17,606 |
|
|
|
16,979 |
|
|
|
35,325 |
|
|
|
32,271 |
|
Provision for income taxes |
|
16,856 |
|
|
|
15,570 |
|
|
|
32,293 |
|
|
|
31,195 |
|
Depreciation and amortization |
|
7,643 |
|
|
|
8,248 |
|
|
|
15,186 |
|
|
|
16,632 |
|
Non-GAAP EBITDA |
$ |
95,664 |
|
|
$ |
91,820 |
|
|
$ |
189,639 |
|
|
$ |
186,393 |
|
Non-GAAP EBITDA Margin |
|
33.4 |
% |
|
|
31.7 |
% |
|
|
33.5 |
% |
|
|
32.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP Net Income to Non-GAAP Free Cash
Flow:
|
Three Months Ended September 30, |
|
Six Months Ended September 30, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
(In thousands) |
|
|
|
|
|
|
|
GAAP Net Income |
$ |
53,559 |
|
|
$ |
51,023 |
|
|
$ |
106,835 |
|
|
$ |
106,295 |
|
Adjustments: |
|
|
|
|
|
|
|
Adjustments to reconcile net income to net cash provided by
operating activities as shown in the Statement of Cash Flows |
|
19,862 |
|
|
|
17,255 |
|
|
|
38,050 |
|
|
|
33,489 |
|
Changes in operating assets and liabilities as shown in the
Statement of Cash Flows |
|
(10,961 |
) |
|
|
(10,738 |
) |
|
|
(34,338 |
) |
|
|
(23,997 |
) |
Total adjustments |
|
8,901 |
|
|
|
6,517 |
|
|
|
3,712 |
|
|
|
9,492 |
|
GAAP Net cash provided by operating activities |
|
62,460 |
|
|
|
57,540 |
|
|
|
110,547 |
|
|
|
115,787 |
|
Purchases of property and equipment |
|
(2,934 |
) |
|
|
(2,376 |
) |
|
|
(4,411 |
) |
|
|
(3,423 |
) |
Non-GAAP Free Cash Flow |
$ |
59,526 |
|
|
$ |
55,164 |
|
|
$ |
106,136 |
|
|
$ |
112,364 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outlook for Fiscal Year
2024:
Reconciliation of Projected GAAP Net
cash provided by operating activities to Projected Non-GAAP Free
Cash Flow:
(In millions) |
|
Projected FY'24 GAAP Net cash provided by operating activities |
$ |
250 |
|
Additions to property and equipment for cash |
|
(10 |
) |
Projected FY'24 Non-GAAP Free Cash Flow |
$ |
240 |
|
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