HAIN Hain Celestial Group Inc

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

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

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

FINANCIAL HIGHLIGHTS*

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

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

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

Cash Flow and Balance Sheet Highlights

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

SEGMENT HIGHLIGHTS

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

North America

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

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

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

International

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

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

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

FISCAL 2024 GUIDANCE**

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

The company is revising guidance for fiscal 2024 as follows:

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

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

Conference Call and Webcast Information

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

About The Hain Celestial Group

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

Forward-Looking Statements

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

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

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

Non-GAAP Financial Measures

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

We define our non-GAAP financial measures as follows:

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

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

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

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

Media Contact:Jen DavisJen.Davis@hain.com 

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

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

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

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

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

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

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

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

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

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