Consolidated Net Sales Growth of 14.3%; Core Net Sales Growth of 17.2% GAAP Diluted EPS of $1.64; Core Adjusted Diluted EPS Growth of 76.8%

Full Year Core Net Sales Growth and Adjusted Diluted EPS Growth Above Phase II Long-Term Targets On Top of Fiscal 2021 Elevated Base

Initiates Fiscal 2023 Outlook: Consolidated Net Sales Growth of 6.8%-8.8%; Core Net Sales Growth of 8.5%-10.5% Consolidated Diluted EPS of $9.92-$10.38 Core Adjusted Diluted EPS of $12.73-$13.03; Growth of 4.5%-7.0%

Helen of Troy Limited (NASDAQ: HELE), designer, developer and worldwide marketer of consumer brand-name home, outdoor, health, wellness, and beauty products, today reported results for the three-month period ended February 28, 2022.

In the fourth quarter of fiscal 2022, the Company changed the names of two of its segments to align with the growth in certain product offerings and brands. The previously named “Housewares” segment was changed to “Home & Outdoor,” and the previously named “Health & Home” segment was changed to “Health & Wellness.” There were no changes to the products or brands included within the segments as part of these name changes.

Executive Summary – Fourth Quarter of Fiscal 2022 Compared to Fiscal 2021 and Fiscal 2020

  • Consolidated net sales revenue of $582.0 million, an increase of 14.3% from fiscal 2021 and an increase of 31.6% from fiscal 2020
  • Core net sales increase of 17.2% from fiscal 2021 and an increase of 37.1% from fiscal 2020
  • GAAP diluted EPS of $1.64, compared to $0.90 for the same period last year and $(0.13) in fiscal 2020
  • Non-GAAP Core adjusted diluted EPS of $2.51, an increase of 76.8% from fiscal 2021 and an increase of 45.1% from fiscal 2020
  • Non-GAAP adjusted diluted EPS of $2.51, an increase of 59.9% from fiscal 2021 and an increase of 33.5% from fiscal 2020
  • Net cash provided by operating activities of $145.9 million

Executive Summary - Fiscal 2022 Compared to Fiscal 2021 and Fiscal 2020

  • Consolidated net sales revenue of $2.22 billion, an increase of 5.9% from fiscal 2021 and an increase of 30.2% from fiscal 2020
  • Core business net sales growth of 8.4% from fiscal 2021 and an increase of 35.5% from fiscal 2020
  • GAAP diluted EPS of $9.17, compared to $10.08 for the same period last year and $6.02 in fiscal 2020
  • Non-GAAP Core adjusted diluted EPS of $12.18, an increase of 10.4% from fiscal 2021 and an increase of 39.7% from fiscal 2020
  • Non-GAAP adjusted diluted EPS of $12.36, an increase of 6.1% from fiscal 2021 and an increase of 32.9% from fiscal 2020
  • Net cash provided by operating activities of $140.8 million, compared to $314.1 million for the same period last year, primarily due to cash used for inventory purchases

Julien R. Mininberg, Chief Executive Officer, stated: “Our fourth quarter results significantly outperformed our expectations in each business segment, delivering an exceptionally strong finish to our fiscal year. We are very proud that fiscal 2022 marks another year of top and bottom line growth well ahead of our Phase II targets, despite the global pandemic, supply chain disruption, inflation, the EPA matter, and the elevated base.”

Mr. Mininberg continued: “Looking back over the first three years of Phase II, core net sales and core adjusted diluted EPS increased by 50% and 68%, respectively. We believe our performance so far in Phase II illustrates the strength of our strategic choices, the power of our diversified portfolio, the return on investments in our Leadership Brands and shared services, and the winning culture and organization we have built. We are proud that our results contributed to total shareholder returns significantly ahead of our proxy peer group since the start of Phase II, and all through Phase I.”

Mr. Mininberg concluded: “As we now begin the fourth year of Phase II, we are pleased to be able to provide our outlook for continued top and bottom-line growth in fiscal 2023. We expect our recent acquisitions of Osprey and Curlsmith will drive revenue and adjusted EPS growth and further expand margins. Our outlook includes our current assessment of the impact from continued widespread inflation on input costs and consumer buying power, further supply chain disruption, and expected rising interest rates. Our outlook also reflects the work we have done with our supply chain partners, cost mitigation measures, pre-negotiated sea freight contracts, and price increases. We will continue to make thoughtful spending choices that support the most important opportunities for our brands, cost efficiency projects, new capabilities, and further scalability for our shared services. We believe this approach will help us continue creating incremental value for shareholders in the remaining two years of Phase II and beyond.”

 

Three Months Ended Last Day of February,

(in thousands)

Home & Outdoor

 

Health & Wellness

 

Beauty

 

Total

Fiscal 2021 sales revenue, net

$

162,463

 

 

$

228,623

 

 

$

118,289

 

 

$

509,375

 

Organic business (1)

 

24,683

 

 

 

(388

)

 

 

25,910

 

 

 

50,205

 

Impact of foreign currency

 

(672

)

 

 

(630

)

 

 

(631

)

 

 

(1,933

)

Acquisition (2)

 

24,373

 

 

 

 

 

 

 

 

 

24,373

 

Change in sales revenue, net

 

48,384

 

 

 

(1,018

)

 

 

25,279

 

 

 

72,645

 

Fiscal 2022 sales revenue, net

$

210,847

 

 

$

227,605

 

 

$

143,568

 

 

$

582,020

 

 

 

 

 

 

 

 

 

Total net sales revenue growth (decline)

 

29.8

%

 

 

(0.4

)%

 

 

21.4

%

 

 

14.3

%

Organic business

 

15.2

%

 

 

(0.2

)%

 

 

21.9

%

 

 

9.9

%

Impact of foreign currency

 

(0.4

)%

 

 

(0.3

)%

 

 

(0.5

)%

 

 

(0.4

)%

Acquisition

 

15.0

%

 

 

%

 

 

%

 

 

4.8

%

 

 

 

 

 

 

 

 

Operating margin (GAAP)

 

 

 

 

 

 

 

Fiscal 2022

 

10.7

%

 

 

4.2

%

 

 

12.6

%

 

 

8.7

%

Fiscal 2021

 

10.0

%

 

 

(0.7

)%

 

 

8.5

%

 

 

4.8

%

Adjusted operating margin (non-GAAP)

 

 

 

 

 

 

 

Fiscal 2022

 

13.1

%

 

 

10.2

%

 

 

15.2

%

 

 

12.5

%

Fiscal 2021

 

11.7

%

 

 

0.7

%

 

 

18.9

%

 

 

8.4

%

Three Months Ended Last Day of February, % Change (in thousands, except per share data) (unaudited)

2022

2021

2020

FY22/FY21

FY22/FY20

Consolidated net sales revenue

$

582,020

$

509,375

$

442,365

 

14.3

%

31.6

%

Core business net sales revenue (3)

 

578,141

 

493,458

 

421,640

 

17.2

%

37.1

%

Leadership Brand net sales revenue (4)

 

480,391

 

417,931

 

347,713

 

14.9

%

38.2

%

Online channel net sales revenue (5)

 

162,107

 

140,016

 

107,329

 

15.8

%

51.0

%

  Consolidated Diluted EPS

$

1.64

$

0.90

($

0.13

)

82.2

%

* Consolidated Adjusted Diluted EPS (non-GAAP) (6)

 

2.51

 

1.57

 

1.88

 

59.9

%

33.5

%

Core Adjusted Diluted EPS (non-GAAP) (3) (6)

 

2.51

 

1.42

 

1.73

 

76.8

%

45.1

%

* Calculation is not meaningful.   Year Ended Last Day of February, % Change (in thousands, except per share data) (unaudited)

2022

2021

2020

FY22/FY21

FY22/FY20

Consolidated net sales revenue

$

2,223,355

$

2,098,799

$

1,707,432

 

5.9

%

30.2

%

Core business net sales revenue (3)

 

2,189,239

 

2,020,453

 

1,615,094

 

8.4

%

35.5

%

Leadership Brand net sales revenue (4)

 

1,810,249

 

1,706,545

 

1,360,059

 

6.1

%

33.1

%

Online channel net sales revenue (5)

 

531,114

 

538,191

 

407,230

 

(1.3

)%

30.4

%

  Consolidated Diluted EPS

$

9.17

$

10.08

$

6.02

 

(9.0

)%

52.3

%

Consolidated Adjusted Diluted EPS (non-GAAP) (6)

 

12.36

 

11.65

 

9.30

 

6.1

%

32.9

%

Core Adjusted Diluted EPS (non-GAAP) (3) (6)

 

12.18

 

11.03

 

8.72

 

10.4

%

39.7

%

Consistent with its strategy of focusing resources on its Leadership Brands, during the fourth quarter of fiscal 2020, the Company committed to a plan to divest certain assets within its Beauty segment’s mass channel personal care business (“Personal Care”). On June 7, 2021, the Company completed the sale of its Personal Care business, not including the Latin America and Caribbean regions, to HRB Brands LLC, for $44.7 million in cash. Accordingly, the Company continued to classify the identified net assets of the Latin America and Caribbean Personal Care businesses as held for sale in its fiscal 2022 financial statements. Subsequent to its fiscal 2022 year end, on March 25, 2022, the Company completed the sale of the Latin America and Caribbean Personal Care businesses to HRB Brands LLC, for $1.8 million in cash.

The Company defines Core business as strategic business that it expects to be an ongoing part of its operations, and Non-Core business as business or net assets (including net assets held for sale) that it expects to divest within a year of its designation as Non-Core. Sales from the Latin America and Caribbean Personal Care businesses are included in Non-Core business for all periods presented and sales from the North America Personal Care business are included in Non-Core business for all periods presented through June 7, 2021.

 

Three Months Ended Last Day of February,

(in thousands)

Home & Outdoor

 

Health & Wellness

 

Beauty

 

Total

Fiscal 2021 sales revenue, net

$

162,463

 

 

$

228,623

 

 

$

118,289

 

 

$

509,375

 

Core business (3)

 

48,384

 

 

 

(1,018

)

 

 

37,317

 

 

 

84,683

 

Non-Core business (Personal Care) (3)

 

 

 

 

 

 

 

(12,038

)

 

 

(12,038

)

Change in sales revenue, net

 

48,384

 

 

 

(1,018

)

 

 

25,279

 

 

 

72,645

 

Fiscal 2022 sales revenue, net

$

210,847

 

 

$

227,605

 

 

$

143,568

 

 

$

582,020

 

 

 

 

 

 

 

 

 

Total net sales revenue growth (decline)

 

29.8

%

 

 

(0.4

)%

 

 

21.4

%

 

 

14.3

%

Core business

 

29.8

%

 

 

(0.4

)%

 

 

31.5

%

 

 

16.6

%

Non-Core business (Personal Care)

 

%

 

 

%

 

 

(10.2

)%

 

 

(2.4

)%

Consolidated Results - Fourth Quarter Fiscal 2022 Compared to Fourth Quarter Fiscal 2021

  • Consolidated net sales revenue increased $72.6 million, or 14.3% to $582.0 million compared to $509.4 million. The growth was driven by an increase from Organic business of $50.2 million, or 9.9%, and from the acquisition of Osprey Packs, Inc. (“Osprey”) of $24.4 million, or 4.8%. The Organic business increase primarily reflects higher brick and mortar and online channel sales in the Home & Outdoor and Beauty segments due primarily to strong consumer demand, approximately $20 million of accelerated retailer orders to improve inventory levels and in anticipation of price increases, higher sales in the club and closeout channels, the impact of customer price increases related to rising freight and product costs, growth in consolidated international sales, and the favorable comparative impact of orders that were not able to be shipped at the end of the fourth quarter of fiscal 2021 due to Winter Storm Uri. These factors were partially offset by a decrease in sales in the Health & Wellness segment as a result of stronger COVID-19 driven demand for healthcare and healthy living products, primarily in thermometry and air filtration, in the comparative prior year period, and a net sales revenue decline in Non-Core business primarily due to the sale of the North America Personal Care business during the second quarter of fiscal 2022.
  • Consolidated gross profit margin decreased 2.6 percentage points to 42.6%, compared to 45.2%. The decrease was primarily due to the net dilutive impact of inflationary costs and related customer price increases, EPA compliance costs of $4.0 million, higher inventory obsolescence expense, and a less favorable channel mix within the Beauty segment. These factors were partially offset by a more favorable brand mix within the Home & Outdoor segment and a favorable mix of more Home & Outdoor and Beauty segment sales within consolidated net sales revenue.
  • Consolidated selling, general and administrative expense (“SG&A”) ratio decreased 4.7 percentage points to 34.0%, compared to 38.7%. The decrease was primarily due to a decrease in marketing expense and the favorable leverage impact of net sales growth. These factors were partially offset by EPA compliance costs of $7.4 million in the Health & Wellness segment, an increase in annual incentive compensation expense, and higher outbound freight costs.
  • Consolidated operating income was $50.4 million, or 8.7% of net sales revenue, compared to $24.5 million, or 4.8% of net sales revenue. The increase in consolidated operating margin was primarily due to a decrease in marketing expense in the Health & Wellness segment, the favorable comparative impact of asset impairment charges recorded in the prior year period and lower marketing expense in the Beauty segment, lower distribution expense and a more favorable brand mix in the Home & Outdoor segment, favorable consolidated operating leverage, and a favorable mix of more Home & Outdoor and Beauty segment sales within consolidated net sales revenue. These factors were partially offset by EPA compliance costs of $11.4 million, the net dilutive impact of inflationary costs and related customer price increases, increased inventory obsolescence expense, an increase in annual incentive compensation expense, higher outbound freight costs, and a less favorable channel mix within the Beauty segment.
  • Income tax expense as a percentage of income before tax was 15.6%, compared to income tax benefit as a percentage of income before tax of 2.7%. The year-over-year change was primarily due to shifts in the mix of taxable income in the Company’s various tax jurisdictions, higher taxes associated with the Company’s Macao subsidiary, the comparative impact of tax benefits recognized on impairment charges in the prior year period, and differences in the Company’s fiscal 2021 actual year-to-date results as compared to estimates used to calculate the estimated annual effective tax rate for the Company’s fiscal 2021 third quarter results.
  • Net Income was $39.8 million, compared to $22.2 million. Diluted EPS was $1.64 compared to $0.90. The increase in diluted EPS was primarily due to higher operating income in all segments and lower weighted average diluted shares outstanding. These factors were partially offset by an increase in the effective income tax rate and higher interest expense.
  • Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) increased 61.9% to $78.7 million compared to $48.6 million.

On an adjusted basis for the fourth quarters of fiscal 2022 and 2021, excluding acquisition-related expenses, asset impairment charges, EPA compliance costs, restructuring charges, amortization of intangible assets, and non-cash share-based compensation, as applicable:

  • Adjusted operating income increased $29.8 million, or 69.5%, to $72.6 million, or 12.5% of net sales revenue, compared to $42.9 million, or 8.4% of net sales revenue. The 4.1 percentage point increase in adjusted operating margin was primarily driven by a decrease in marketing expense in the Health & Wellness and Beauty segments, lower distribution expenses and a favorable brand mix in the Home & Outdoor segment, favorable consolidated operating leverage, and a favorable mix of more Home & Outdoor and Beauty segment sales within consolidated net sales revenue. These factors were partially offset by the net dilutive impact of inflationary costs and related customer price increases, higher inventory obsolescence expense, an increase in annual incentive compensation expense, higher outbound freight costs, and a less favorable channel mix within the Beauty segment.
  • Adjusted income increased $22.1 million, or 56.9%, to $60.8 million, compared to $38.8 million. Adjusted diluted EPS increased 59.9% to $2.51, compared to $1.57. The increase in adjusted diluted EPS was primarily due to higher adjusted operating income in the Home & Outdoor and Health & Wellness segments and lower weighted average diluted shares outstanding. These factors were partially offset by lower adjusted operating income in the Beauty segment, an increase in the effective income tax rate and higher interest expense.

Segment Results - Fourth Quarter Fiscal 2022 Compared to Fourth Quarter Fiscal 2021

Home & Outdoor net sales revenue increased $48.4 million, or 29.8%, to $210.8 million, compared to $162.5 million. The growth was driven by an increase from Organic business of $24.7 million, or 15.2%, and growth from the acquisition of Osprey of $24.4 million, or 15.0%. The Organic business increase was primarily due to higher brick and mortar and online channel sales driven by strong consumer demand, accelerated retailer orders to improve inventory levels and in anticipation of price increases, higher sales in the club and closeout channels, the impact of customer price increases related to rising freight and product costs, growth in international sales, and the favorable comparative impact of COVID-19 reduced store traffic and orders that were not able to be shipped at the end of the fourth quarter of fiscal 2021 due to Winter Storm Uri. Operating income increased 39.7% to $22.6 million, or 10.7% of segment net sales revenue, compared to $16.2 million, or 10.0% of segment net sales revenue. The 0.7 percentage point increase was primarily due to favorable operating leverage, a more favorable brand mix and a decrease in distribution expense. These factors were partially offset by the net dilutive impact of inflationary costs and related customer price increases, higher inventory obsolescence expense, increased personnel expense, higher acquisition-related expenses, and higher amortization expense. Adjusted operating income increased 45.2% to $27.5 million, or 13.1% of segment net sales revenue, compared to $19.0 million, or 11.7% of segment net sales revenue.

Health & Wellness net sales revenue decreased $1.0 million, or 0.4%, to $227.6 million, compared to $228.6 million. The decline was driven by a decrease from Organic business of $0.4 million, or 0.2%, primarily due to a decrease in sales of thermometers and air filtration products due to stronger COVID-19 driven demand for healthcare and healthy living products in the comparative prior year period. These factors were partially offset by an increase in sales of fans, higher humidification product sales due to the COVID-19 Omicron variant surge, and the impact of customer price increases related to rising freight and product costs. Operating income was $9.6 million, or 4.2% of segment net sales revenue, compared to operating loss of $1.7 million, or 0.7% of segment net sales revenue. The 4.9 percentage point increase in segment operating margin was primarily due to a decrease in marketing expense, lower new product development expense, lower royalty expense, and a decrease in amortization expense. These factors were partially offset by EPA compliance costs of $11.4 million, an increase in outbound freight costs, increased inventory obsolescence expense, higher distribution expense, a less favorable product mix, and the net dilutive impact of inflationary costs and related customer price increases. Adjusted operating income increased to $23.3 million, or 10.2% of segment net sales revenue, compared to $1.5 million, or 0.7% of segment net sales revenue.

Net sales revenue from Beauty Core business increased $37.3 million, or 31.5%, primarily reflecting higher brick and mortar and online channel sales driven by strong consumer demand and accelerated retailer orders to improve inventory levels and in anticipation of price increases, an increase in closeout channel sales, new product introductions, higher international sales. Total Beauty segment net sales revenue increased $25.3 million, or 21.4%, to $143.6 million, compared to $118.3 million primarily due to Core business growth partially offset by the sale of the Non-Core North America Personal Care business during the second quarter of fiscal 2022. Operating income was $18.2 million, or 12.6% of segment net sales revenue, compared to $10.0 million, or 8.5% of segment net sales revenue. The 4.1 percentage point increase in segment operating margin reflects favorable operating leverage, the favorable comparative impact of asset impairment charges recorded in the prior year period, a decrease in marketing expense, and lower amortization expense. These factors were partially offset by a less favorable channel mix, the net dilutive impact of inflationary costs and related customer price increases, higher royalty expense, and an increase in annual incentive compensation expense. Adjusted operating income decreased 2.5% to $21.8 million, or 15.2% of segment net sales revenue, compared to $22.4 million, or 18.9% of segment net sales revenue.

Balance Sheet and Cash Flow Highlights - Fiscal 2022 Compared to Fiscal 2021

  • Cash and cash equivalents totaled $33.4 million, compared to $45.1 million.
  • Accounts receivable turnover for fiscal 2022 was 72.6 days, compared to 68.6 days for the same period last year.
  • Inventory was $558.0 million, compared to $481.6 million. Inventory turnover for fiscal 2022 was 2.3 times, compared to 3.2 times for the same period last year.
  • Total short- and long-term debt was $813.2 million, compared to $343.6 million.
  • Net cash provided by operating activities for fiscal 2022 was $140.8 million, compared to $314.1 million.
  • Net cash used by investing activities of $438.9 million included investments to acquire Osprey for $410.9 million and capital and intangible asset expenditures of $78.0 million, of which $55.8 million was for land and initial construction expenditures related to a new 2 million square foot distribution center. This was partially offset by proceeds from the sale of the Company's North America Personal Care business of $44.7 million.
  • Net cash provided by financing activities included share repurchases of common stock in the open market during the fiscal year for $170.7 million.

Subsequent Events

On March 30, 2022, a third-party facility that the Company utilizes for inventory storage incurred severe damage from a weather-related incident. The Company’s inventory stored at this facility primarily relates to the Health & Wellness and Beauty segments. While the inventory is insured, some seasonal inventory and inventory designated for specific customer promotions is currently not accessible, and as a result, may unfavorably impact the Company's net sales revenue in the first half of fiscal 2023. The Company is working with local officials and its insurance provider to understand the extent of the damage, however the building must be assessed and made to be structurally sound before the Company will have access to the inventory and be able to fully assess damages.

On April 22, 2022, the Company completed the acquisition of Recipe Products Ltd., a producer of innovative prestige hair care products for all types of curly and wavy hair under the Curlsmith brand (“Curlsmith”). The total purchase consideration, net of cash acquired, was $150.0 million in cash, subject to certain customary closing adjustments. The acquisition was funded with cash on hand and borrowings under the Company’s existing revolving credit facility.

EPA Update

As previously disclosed, during fiscal 2022, the Company was in discussions with the U.S. Environmental Protection Agency (the “EPA”) regarding the compliance of packaging claims on certain of its products in the air and water filtration categories and a limited subset of humidifier products within the Health & Wellness segment that are sold in the United States. The EPA approved modest changes to labeling claims on packaging of the air and water filtration impacted products, which the Company implemented, and subsequently resumed shipping during fiscal 2022. While the Company resumed normalized levels of shipping of the affected inventory by the end of the third fiscal quarter, the Company is still in process of repackaging the existing inventory of impacted products. Additionally, as a result of continuing dialogue with the EPA, the Company is executing further repackaging and relabeling plans on certain additional humidifier products and certain additional air filtration products.

Executive Leadership Update

To accommodate the significant growth during its Transformation, the Company previously announced that it would be creating a Chief Operating Officer role. Noel Geoffroy will join Helen of Troy as Chief Operating Officer on May 9, 2022 and will oversee the day-to-day business and execution of the major Phase II projects. Ms. Geoffroy joins Helen of Troy with over 25 years of experience as a proven leader in President and General Manager roles at world class companies including Sanofi in Consumer Healthcare, Kellogg, H. J. Heinz, and Procter & Gamble. She is a consumer-centric leader, brand builder, and product innovator with a strong reputation as an inspirational organizational and cultural leader.

Fiscal 2023 Annual Outlook

Due to the sale of the majority of the Personal Care business during the second quarter of fiscal 2022 and the sale of the remaining Latin America and Caribbean Personal Care business on March 25, 2022, the Company is not currently expecting any material activity related to Non-Core business in fiscal 2023. Therefore, the amounts included in its outlook for fiscal 2023 will be shown on a consolidated basis. However, due to the fact that the fiscal 2022 results include material activity related to Non-Core business, the year-over-year growth rates on a consolidated and Core business basis will be different. Where appropriate, the information provided in the outlook will reflect growth rates on both a consolidated and Core business basis. The Company believes that Core business growth is the most relevant basis as it provides the best comparability between historical and future periods.

The Company expects consolidated net sales revenue in the range of $2.38 billion to $2.42 billion, which implies consolidated growth of 6.8% to 8.8% and Core business growth of 8.5% to 10.5%.

The Company’s fiscal year net sales outlook reflects the following expectations by segment:

  • Home & Outdoor net sales growth of 19.0% to 21.0%; including net sales from Osprey of $180 million to $185 million;
  • Health & Wellness net sales decline of 1.0% to growth of 1.0%; and
  • Beauty Core business net sales growth of 4.5% to 7.5%; including net sales from Curlsmith of $30 million to $35 million

The Company expects consolidated GAAP diluted EPS of $9.92 to $10.38 and consolidated non-GAAP adjusted diluted EPS in the range of $12.73 to $13.03, which implies consolidated adjusted diluted EPS growth of 3.0% to 5.4% and Core adjusted diluted EPS growth of 4.5% to 7.0%. This includes adjusted diluted EPS contribution from Osprey of $0.50 to $0.55 and $0.20 to $0.25 from Curlsmith.

The Company’s consolidated net sales and EPS outlooks reflect the following assumptions:

  • the severity of the cough/cold/flu season will be in line with pre-COVID historical averages;
  • April 2022 foreign currency exchange rates will remain constant for the remainder of the fiscal year;
  • the estimated net favorable impact to net sales of approximately $10 million and adjusted diluted EPS of approximately $0.10 related to the EPA matter;
  • an estimated unfavorable impact to net sales of approximately $10 million and adjusted diluted EPS of approximately $0.10 due to not being able to ship certain products on a timely basis related to damage to a third party storage facility caused by a severe weather event in March 2022;
  • estimated incremental after-tax inflationary cost pressures in the range of $75 million to $80 million, or approximately $3.10 to $3.30 of adjusted diluted EPS
  • expected interest expense in the range of $35 million to $36 million due to higher average levels of debt due to recent acquisitions and the expectation the Federal Open Market Committee (“FOMC”) will increase interest rates by 225 basis points during calendar year 2022;
  • a reported consolidated GAAP effective tax rate range of 13.0% to 14.0% for the full fiscal year 2023 and a consolidated adjusted effective tax rate range of 11.7% to 12.7%; and
  • an estimated weighted average diluted shares outstanding of 24.2 million.

The Company expects capital and intangible asset expenditures of $180 million to $205 million for the full fiscal year 2023 including expected expenditures of $145 million to $170 million related to the construction of a new distribution facility that is expected to be completed by the end of fiscal 2023.

With regard to quarterly cadence, the Company expects the majority of its net sales and adjusted diluted EPS growth to be concentrated in the second and third quarters of fiscal 2023 due primarily to the impact of approximately $20 million of accelerated retailer orders in the fourth quarter of fiscal 2022, the strong net sales and adjusted diluted EPS growth comparisons in the first and fourth quarters of fiscal 2022, and the adverse net sales and earnings impact of the EPA matter in the second and third quarters of fiscal 2022.

The likelihood and potential impact of any additional fiscal 2023 acquisitions and divestitures, future asset impairment charges, future foreign currency fluctuations, additional interest rate increases, material long-term distribution losses and/or customer returns that may arise related to the EPA matter, or further share repurchases are unknown and cannot be reasonably estimated; therefore, they are not included in the Company’s outlook.

Conference Call and Webcast

The Company will conduct a teleconference in conjunction with today’s earnings release. The teleconference begins at 9:00 a.m. Eastern Time today, Wednesday, April 27, 2022. Institutional investors and analysts interested in participating in the call are invited to dial (877) 407-3982 approximately ten minutes prior to the start of the call. The conference call will also be webcast live on the Events & Presentations page at: http://investor.helenoftroy.com/. A telephone replay of this call will be available at 12:00 p.m. Eastern Time on April 27, 2022 until 11:59 p.m. Eastern Time on May 4, 2022 and can be accessed by dialing (844) 512-2921 and entering replay pin number 13728630. A replay of the webcast will remain available on the website for one year.

Non-GAAP Financial Measures

The Company reports and discusses its operating results using financial measures consistent with accounting principles generally accepted in the United States of America (“GAAP”). To supplement its presentation, the Company discloses certain financial measures that may be considered non-GAAP such as Adjusted Operating Income, Adjusted Operating Margin, Core and Non-Core Adjusted Operating Income, Core and Non-Core Adjusted Operating Margin, Adjusted Effective Tax Rate, Core Adjusted Effective Tax Rate, Adjusted Income, Adjusted Diluted Earnings per Share (“EPS”), Core and Non-Core Adjusted Diluted EPS, EBITDA, Adjusted EBITDA, and Free Cash Flow, which are presented in accompanying tables to this press release along with a reconciliation of these financial measures to their corresponding GAAP-based measures presented in the Company’s consolidated statements of income and cash flows. For additional information see Note 6 to the accompanying tables to this press release.

About Helen of Troy Limited

Helen of Troy Limited (NASDAQ: HELE) is a leading global consumer products company offering creative products and solutions for its customers through a diversified portfolio of well-recognized and widely-trusted brands, including OXO, Hydro Flask, Osprey, Vicks, Braun, Honeywell, PUR, Hot Tools and Drybar. The Company sometimes refers to these brands as its Leadership Brands. All trademarks herein belong to Helen of Troy Limited (or its subsidiaries) and/or are used under license from their respective licensors.

For more information about Helen of Troy, please visit http://investor.helenoftroy.com

Forward-Looking Statements

Certain written and oral statements made by the Company and subsidiaries of the Company may constitute “forward-looking statements” as defined under the Private Securities Litigation Reform Act of 1995. This includes statements made in this press release, in other filings with the SEC, and in certain other oral and written presentations. Generally, the words “anticipates”, “believes”, “expects”, “plans”, “may”, “will”, “would”, “should”, “seeks”, “estimates”, “project”, “predict”, “potential”, “currently”, “continue”, “intends”, “outlook”, “forecasts”, “could”, and other similar words identify forward-looking statements. All statements that address operating results, events or developments that the Company expects or anticipates may occur in the future, including statements related to sales, earnings per share results, and statements expressing general expectations about future operating results, are forward-looking statements and are based upon its current expectations and various assumptions. The Company believes there is a reasonable basis for these expectations and assumptions, but there can be no assurance that the Company will realize these expectations or that these assumptions will prove correct. Forward-looking statements are subject to risks that could cause them to differ materially from actual results. Accordingly, the Company cautions readers not to place undue reliance on forward-looking statements. The forward-looking statements contained in this press release should be read in conjunction with, and are subject to and qualified by, the risks described in the Company’s Form 10-K for the year ended February 28, 2022, and in the Company’s other filings with the SEC. Investors are urged to refer to the risk factors referred to above for a description of these risks. Such risks include, among others, the occurrence of cyber incidents or failure by the Company or its third-party service providers to maintain cybersecurity and the integrity of confidential internal or customer data, a cybersecurity breach, obsolescence or interruptions in the operation of the Company’s central global Enterprise Resource Planning systems and other peripheral information systems, the geographic concentration and peak season capacity of certain U.S. distribution facilities which increase its risk to disruptions that could affect the Company’s ability to deliver products in a timely manner, the Company's ability to successfully manage the demand, supply, and operational challenges associated with the actual or perceived effects of COVID-19 and any similar future public health crisis, pandemic or epidemic, the Company’s ability to develop and introduce a continuing stream of innovative new products to meet changing consumer preferences, actions taken by large customers that may adversely affect the Company’s gross profit and operating results, the Company’s dependence on sales to several large customers and the risks associated with any loss of, or substantial decline in, sales to top customers, the Company’s dependence on third-party manufacturers, most of which are located in Asia, and any inability to obtain products from such manufacturers, the Company’s ability to deliver products to its customers in a timely manner and according to their fulfillment standards, the risks associated with trade barriers, exchange controls, expropriations, and other risks associated with domestic and foreign operations including uncertainty and business interruptions resulting from political changes and actions in the U.S. and abroad, such as the current conflict between Russia and Ukraine, and volatility in the global credit and financial markets and economy, the Company’s dependence on the strength of retail economies and vulnerabilities to any prolonged economic downturn, including a future downturn from the effects of COVID-19, risks associated with the use of licensed trademarks from or to third parties, risks associated with weather conditions, the duration and severity of the cold and flu season and other related factors, the Company’s reliance on its Chief Executive Officer and a limited number of other key senior officers to operate its business, expectations regarding recent acquisitions (including Curlsmith and Osprey) and any future acquisitions or divestitures, including the Company’s ability to realize related synergies along with its ability to effectively integrate acquired businesses or disaggregate divested businesses, the risks of potential changes in laws and regulations, including environmental, employment and health and safety and tax laws, and the costs and complexities of compliance with such laws, the risks associated with increased focus and expectations on climate change and other environmental, social and governance matters, the risks associated with significant changes in or the Company’s compliance with regulations, interpretations or product certification requirements, the risks associated with global legal developments regarding privacy and data security that could result in changes to its business practices, penalties, increased cost of operations, or otherwise harm the business, the Company’s ability to continue to avoid classification as a Controlled Foreign Corporation, the risks associated with legislation enacted in Bermuda and Barbados in response to the European Union’s review of harmful tax competition, the risks associated with accounting for tax positions and the resolution of tax disputes, the risks of significant tariffs or other restrictions being placed on imports from China, Mexico or Vietnam or any retaliatory trade measures taken by China, Mexico or Vietnam, the risks associated with product recalls, product liability and other claims against the Company, and associated financial risks including but not limited to, significant impairment of the Company’s goodwill, indefinite-lived and definite-lived intangible assets or other long-lived assets, increased costs of raw materials, energy and transportation, the risks to the Company’s liquidity or cost of capital which may be materially adversely affected by constraints or changes in the capital and credit markets and limitations under its financing arrangements, risks associated with foreign currency exchange rate fluctuations, and projections of product demand, sales and net income, which are highly subjective in nature, and from which future sales and net income could vary in a material amount. The Company undertakes no obligation to publicly update or revise any forward-looking statements as a result of new information, future events or otherwise.

HELEN OF TROY LIMITED AND SUBSIDIARIES

Consolidated Statements of Income (2)

(Unaudited) (in thousands, except per share data)

  Three Months Ended Last Day of February,

2022

2021

Sales revenue, net

$

582,020

100.0

%

$

509,375

 

100.0

%

Cost of goods sold

 

333,846

57.4

%

 

279,037

 

54.8

%

Gross profit

 

248,174

42.6

%

 

230,338

 

45.2

%

Selling, general and administrative expense (“SG&A”)

 

197,790

34.0

%

 

197,366

 

38.7

%

Asset impairment charges

 

%

 

8,452

 

1.7

%

Restructuring charges

 

%

 

(5

)

%

Operating income

 

50,384

8.7

%

 

24,525

 

4.8

%

Non-operating income, net

 

75

%

 

119

 

%

Interest expense

 

3,336

0.6

%

 

3,049

 

0.6

%

Income before income tax

 

47,123

8.1

%

 

21,595

 

4.2

%

Income tax expense (benefit)

 

7,329

1.3

%

 

(577

)

(0.1

)%

Net income

$

39,794

6.8

%

$

22,172

 

4.4

%

  Diluted earnings per share (“EPS”)

$

1.64

$

0.90

 

  Weighted average shares of common stock used in computing diluted EPS

 

24,259

 

24,737

 

  Fiscal Year Ended Last Day of February,

2022

2021

Sales revenue, net

$

2,223,355

100.0

%

$

2,098,799

 

100.0

%

Cost of goods sold

 

1,270,168

57.1

%

 

1,171,497

 

55.8

%

Gross profit

 

953,187

42.9

%

 

927,302

 

44.2

%

SG&A

 

680,257

30.6

%

 

637,012

 

30.4

%

Asset impairment charges

 

%

 

8,452

 

0.4

%

Restructuring charges

 

380

%

 

350

 

%

Operating income

 

272,550

12.3

%

 

281,488

 

13.4

%

Non-operating income, net

 

260

%

 

559

 

%

Interest expense

 

12,844

0.6

%

 

12,617

 

0.6

%

Income before income tax

 

259,966

11.7

%

 

269,430

 

12.8

%

Income tax expense

 

36,202

1.6

%

 

15,484

 

0.7

%

Net income

$

223,764

10.1

%

$

253,946

 

12.1

%

  Diluted EPS

$

9.17

$

10.08

 

  Weighted average shares of common stock used in computing diluted EPS

 

24,410

 

25,196

 

 

Consolidated Statements of Income and Reconciliation of Non-GAAP Financial Measures –

Adjusted Operating Income, Adjusted Income and Adjusted Diluted EPS (2) (6)

(Unaudited) (in thousands, except per share data)

 

 

Three Months Ended February 28, 2022

 

As Reported

(GAAP)

 

Adjustments

 

Adjusted

(Non-GAAP)

Sales revenue, net

$

582,020

 

 

100.0

%

 

$

 

 

$

582,020

 

100.0

%

Cost of goods sold

 

333,846

 

 

57.4

%

 

 

(3,953

)

(

7)

 

329,893

 

56.7

%

Gross profit

 

248,174

 

 

42.6

%

 

 

3,953

 

 

 

252,127

 

43.3

%

SG&A

 

197,790

 

 

34.0

%

 

 

(7,403

)

(

7)

 

179,498

 

30.8

%

 

 

 

 

 

 

(819

)

(

8)

 

 

 

 

 

 

 

 

 

(3,801

)

(

9)

 

 

 

 

 

 

 

 

 

(6,269

)

(

10)

 

 

 

Operating income

 

50,384

 

 

8.7

%

 

 

22,245

 

 

 

72,629

 

12.5

%

Non-operating income, net

 

75

 

 

%

 

 

 

 

 

75

 

%

Interest expense

 

3,336

 

 

0.6

%

 

 

 

 

 

3,336

 

0.6

%

Income before income tax

 

47,123

 

 

8.1

%

 

 

22,245

 

 

 

69,368

 

11.9

%

Income tax expense

 

7,329

 

 

1.3

%

 

 

1,216

 

 

 

8,545

 

1.5

%

Net Income

$

39,794

 

 

6.8

%

 

$

21,029

 

 

$

60,823

 

10.5

%

 

 

 

 

 

 

 

 

 

 

Diluted EPS

$

1.64

 

 

 

 

$

0.87

 

 

$

2.51

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares of common stock used in computing diluted EPS

 

24,259

 

 

 

 

 

 

 

24,259

 

 

 

 

Three Months Ended February 28, 2021

 

As Reported

(GAAP)

 

Adjustments

 

Adjusted

(Non-GAAP)

Sales revenue, net

$

509,375

 

 

100.0

%

 

$

 

 

$

509,375

 

100.0

%

Cost of goods sold

 

279,037

 

 

54.8

%

 

 

 

 

 

279,037

 

54.8

%

Gross profit

 

230,338

 

 

45.2

%

 

 

 

 

 

230,338

 

45.2

%

SG&A

 

197,366

 

 

38.7

%

 

 

(4,116

)

(

9)

 

187,486

 

36.8

%

 

 

 

 

 

 

(5,764

)

(

10)

 

 

 

Asset impairment charges

 

8,452

 

 

1.7

%

 

 

(8,452

)

(

11)

 

 

%

Restructuring charges

 

(5

)

 

%

 

 

5

 

(

12)

 

 

%

Operating income

 

24,525

 

 

4.8

%

 

 

18,327

 

 

 

42,852

 

8.4

%

Non-operating income, net

 

119

 

 

%

 

 

 

 

 

119

 

%

Interest expense

 

3,049

 

 

0.6

%

 

 

 

 

 

3,049

 

0.6

%

Income before income tax

 

21,595

 

 

4.2

%

 

 

18,327

 

 

 

39,922

 

7.8

%

Income tax (benefit) expense

 

(577

)

 

(0.1

) %

 

 

1,743

 

 

 

1,166

 

0.2

%

Net income

$

22,172

 

 

4.4

%

 

$

16,584

 

 

$

38,756

 

7.6

%

 

 

 

 

 

 

 

 

 

 

Diluted EPS

$

0.90

 

 

 

 

$

0.67

 

 

$

1.57

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares of common stock used in computing diluted EPS

 

24,737

 

 

 

 

 

 

 

24,737

 

 

 

Consolidated Statements of Income and Reconciliation of Non-GAAP Financial Measures –

Adjusted Operating Income, Adjusted Income and Adjusted Diluted EPS (2) (6)

(Unaudited) (in thousands, except per share data)

 

 

Fiscal Year Ended February 28, 2022

 

As Reported

(GAAP)

 

Adjustments

 

Adjusted

(Non-GAAP)

Sales revenue, net

$

2,223,355

 

100.0

%

 

$

 

 

$

2,223,355

 

100.0

%

Cost of goods sold

 

1,270,168

 

57.1

%

 

 

(17,728

)

(

7)

 

1,252,440

 

56.3

%

Gross profit

 

953,187

 

42.9

%

 

 

17,728

 

 

 

970,915

 

43.7

%

SG&A

 

680,257

 

30.6

%

 

 

(14,626

)

(

7)

 

615,825

 

27.7

%

 

 

 

 

 

 

(2,424

)

(

8)

 

 

 

 

 

 

 

 

 

(12,764

)

(

9)

 

 

 

 

 

 

 

 

 

(34,618

)

(

10)

 

 

 

Restructuring charges

 

380

 

%

 

 

(380

)

(

12)

 

 

%

Operating income

 

272,550

 

12.3

%

 

 

82,540

 

 

 

355,090

 

16.0

%

Non-operating income, net

 

260

 

%

 

 

 

 

 

260

 

%

Interest expense

 

12,844

 

0.6

%

 

 

 

 

 

12,844

 

0.6

%

Income before income tax

 

259,966

 

11.7

%

 

 

82,540

 

 

 

342,506

 

15.4

%

Income tax expense

 

36,202

 

1.6

%

 

 

4,553

 

 

 

40,755

 

1.8

%

Net Income

$

223,764

 

10.1

%

 

$

77,987

 

 

$

301,751

 

13.6

%

 

 

 

 

 

 

 

 

 

 

Diluted EPS

$

9.17

 

 

 

$

3.19

 

 

$

12.36

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares of common stock used in computing diluted EPS

 

24,410

 

 

 

 

 

 

24,410

 

 

 

 

Fiscal Year Ended February 28, 2021

 

As Reported

(GAAP)

 

Adjustments

 

Adjusted

(Non-GAAP)

Sales revenue, net

$

2,098,799

 

100.0

%

 

$

 

 

$

2,098,799

 

100.0

%

Cost of goods sold

 

1,171,497

 

55.8

%

 

 

 

 

 

1,171,497

 

55.8

%

Gross profit

 

927,302

 

44.2

%

 

 

 

 

 

927,302

 

44.2

%

SG&A

 

637,012

 

30.4

%

 

 

(17,643

)

(

9)

 

592,951

 

28.3

%

 

 

 

 

 

 

(26,418

)

(

10)

 

 

 

Asset impairment charges

 

8,452

 

0.4

%

 

 

(8,452

)

(

11)

 

 

%

Restructuring charges

 

350

 

%

 

 

(350

)

(

12)

 

 

%

Operating income

 

281,488

 

13.4

%

 

 

52,863

 

 

 

334,351

 

15.9

%

Non-operating income, net

 

559

 

%

 

 

 

 

 

559

 

%

Interest expense

 

12,617

 

0.6

%

 

 

 

 

 

12,617

 

0.6

%

Income before income tax

 

269,430

 

12.8

%

 

 

52,863

 

 

 

322,293

 

15.4

%

Income tax expense

 

15,484

 

0.7

%

 

 

13,159

 

 

 

28,643

 

1.4

%

Net Income

$

253,946

 

12.1

%

 

$

39,704

 

 

$

293,650

 

14.0

%

 

 

 

 

 

 

 

 

 

 

Diluted EPS

$

10.08

 

 

 

$

1.58

 

 

$

11.65

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares of common stock used in computing diluted EPS

 

25,196

 

 

 

 

 

 

25,196

 

 

 

Consolidated and Segment Net Sales Revenue

(Unaudited) (in thousands)

 

 

Three Months Ended Last Day of February,

 

Home & Outdoor

 

Health & Wellness

 

Beauty

 

Total

Fiscal 2021 sales revenue, net

$

162,463

 

 

$

228,623

 

 

$

118,289

 

 

$

509,375

 

Organic business (1)

 

24,683

 

 

 

(388

)

 

 

25,910

 

 

 

50,205

 

Impact of foreign currency

 

(672

)

 

 

(630

)

 

 

(631

)

 

 

(1,933

)

Acquisition (2)

 

24,373

 

 

 

 

 

 

 

 

 

24,373

 

Change in sales revenue, net

 

48,384

 

 

 

(1,018

)

 

 

25,279

 

 

 

72,645

 

Fiscal 2022 sales revenue, net

$

210,847

 

 

$

227,605

 

 

$

143,568

 

 

$

582,020

 

 

 

 

 

 

 

 

 

Total net sales revenue growth (decline)

 

29.8

%

 

 

(0.4

)%

 

 

21.4

%

 

 

14.3

%

Organic business

 

15.2

%

 

 

(0.2

)%

 

 

21.9

%

 

 

9.9

%

Impact of foreign currency

 

(0.4

)%

 

 

(0.3

)%

 

 

(0.5

)%

 

 

(0.4

)%

Acquisition

 

15.0

%

 

 

%

 

 

%

 

 

4.8

%

 

 

Fiscal Year Ended Last Day of February,

 

Home & Outdoor

 

Health & Wellness

 

Beauty

 

Total

Fiscal 2021 sales revenue, net

$

727,354

 

 

$

890,191

 

 

$

481,254

 

 

$

2,098,799

 

Organic business (1)

 

113,495

 

 

 

(116,690

)

 

 

96,550

 

 

 

93,355

 

Impact of foreign currency

 

622

 

 

 

3,579

 

 

 

2,627

 

 

 

6,828

 

Acquisition (2)

 

24,373

 

 

 

 

 

 

 

 

 

24,373

 

Change in sales revenue, net

 

138,490

 

 

 

(113,111

)

 

 

99,177

 

 

 

124,556

 

Fiscal 2022 sales revenue, net

$

865,844

 

 

$

777,080

 

 

$

580,431

 

 

$

2,223,355

 

 

 

 

 

 

 

 

 

Total net sales revenue growth (decline)

 

19.0

%

 

 

(12.7

) %

 

 

20.6

%

 

 

5.9

%

Organic business

 

15.6

%

 

 

(13.1

) %

 

 

20.1

%

 

 

4.4

%

Impact of foreign currency

 

0.1

%

 

 

0.4

%

 

 

0.5

%

 

 

0.3

%

Acquisition

 

3.4

%

 

 

%

 

 

%

 

 

1.2

%

 

Leadership Brand and Other Net Sales Revenue (2)

(Unaudited) (in thousands)

 

 

Three Months Ended Last Day of February,

 

2022

 

2021

 

$ Change

 

% Change

Leadership Brand sales revenue, net (4)

$

480,391

 

$

417,931

 

$

62,460

 

14.9

%

All other sales revenue, net

 

101,629

 

 

91,444

 

10,185

 

11.1

%

Total sales revenue, net

$

582,020

 

$

509,375

 

$

72,645

 

14.3

%

 

 

Fiscal Year Ended Last Day of February,

 

2022

 

2021

 

$ Change

 

% Change

Leadership Brand sales revenue, net (4)

$

1,810,249

 

$

1,706,545

 

$

103,704

 

6.1

%

All other sales revenue, net

 

413,106

 

 

392,254

 

 

20,852

 

5.3

%

Total sales revenue, net

$

2,223,355

 

$

2,098,799

 

$

124,556

 

5.9

%

 

Consolidated and Segment Net Sales from Core and Non-Core Business (3)

(Unaudited) (in thousands)

 

 

Three Months Ended Last Day of February,

 

Home & Outdoor

 

Health & Wellness

 

Beauty

 

Total

Fiscal 2021 sales revenue, net

$

162,463

 

 

$

228,623

 

 

$

118,289

 

 

$

509,375

 

Core business

 

48,384

 

 

 

(1,018

)

 

 

37,317

 

 

 

84,683

 

Non-Core business (Personal Care)

 

 

 

 

 

 

 

(12,038

)

 

 

(12,038

)

Change in sales revenue, net

 

48,384

 

 

 

(1,018

)

 

 

25,279

 

 

 

72,645

 

Fiscal 2022 sales revenue, net

$

210,847

 

 

$

227,605

 

 

$

143,568

 

 

$

582,020

 

 

 

 

 

 

 

 

 

Total net sales revenue growth (decline)

 

29.8

%

 

 

(0.4

) %

 

 

21.4

%

 

 

14.3

%

Core business

 

29.8

%

 

 

(0.4

) %

 

 

31.5

%

 

 

16.6

%

Non-Core business (Personal Care)

 

%

 

 

%

 

 

(10.2

)%

 

 

(2.4

)%

 

 

Fiscal Year Ended Last Day of February,

 

Home & Outdoor

 

Health & Wellness

 

Beauty

 

Total

Fiscal 2021 sales revenue, net

$

727,354

 

 

$

890,191

 

 

$

481,254

 

 

$

2,098,799

 

Core business

 

138,490

 

 

 

(113,111

)

 

 

143,407

 

 

 

168,786

 

Non-Core business (Personal Care)

 

 

 

 

 

 

 

(44,230

)

 

 

(44,230

)

Change in sales revenue, net

 

138,490

 

 

 

(113,111

)

 

 

99,177

 

 

 

124,556

 

Fiscal 2022 sales revenue, net

$

865,844

 

 

$

777,080

 

 

$

580,431

 

 

$

2,223,355

 

 

 

 

 

 

 

 

 

Total net sales revenue growth (decline)

 

19.0

%

 

 

(12.7

) %

 

 

20.6

%

 

 

5.9

%

Core business

 

19.0

%

 

 

(12.7

) %

 

 

29.8

%

 

 

8.0

%

Non-Core business (Personal Care)

 

%

 

 

%

 

 

(9.2

)%

 

 

(2.1

)%

 

Reconciliation of Non-GAAP Financial Measures – GAAP Operating Income

to Adjusted Operating Income (Non-GAAP) (6)

(Unaudited) (in thousands)

 

 

Three Months Ended February 28, 2022

 

Home &

Outdoor (2)

 

Health & Wellness

 

Beauty

 

Total

Operating income, as reported (GAAP)

$

22,622

 

 

10.7

%

 

$

9,601

 

 

4.2

%

 

$

18,161

 

12.6

%

 

$

50,384

 

 

8.7

%

Acquisition-related expenses

 

819

 

 

0.4

%

 

 

 

 

%

 

 

 

%

 

 

819

 

 

0.1

%

EPA compliance costs

 

 

 

%

 

 

11,356

 

 

5.0

%

 

 

 

%

 

 

11,356

 

 

2.0

%

Restructuring charges

 

 

 

%

 

 

 

 

%

 

 

 

%

 

 

 

 

%

Subtotal

 

23,441

 

 

11.1

%

 

 

20,957

 

 

9.2

%

 

 

18,161

 

12.6

%

 

 

62,559

 

 

10.7

%

Amortization of intangible assets

 

1,329

 

 

0.6

%

 

 

575

 

 

0.3

%

 

 

1,897

 

1.3

%

 

 

3,801

 

 

0.7

%

Non-cash share-based compensation

 

2,765

 

 

1.3

%

 

 

1,772

 

 

0.8

%

 

 

1,732

 

1.2

%

 

 

6,269

 

 

1.1

%

Adjusted operating income (non-GAAP)

$

27,535

 

 

13.1

%

 

$

23,304

 

 

10.2

%

 

$

21,790

 

15.2

%

 

$

72,629

 

 

12.5

%

 

 

Three Months Ended February 28, 2021

 

Home &

Outdoor

 

Health & Wellness

 

Beauty

 

Total

Operating income (loss), as reported (GAAP)

$

16,193

 

 

10.0

%

 

$

(1,679

)

 

(0.7

) %

 

$

10,011

 

8.5

%

 

$

24,525

 

 

4.8

%

Asset impairment charges

 

 

 

%

 

 

 

 

%

 

 

8,452

 

7.1

%

 

 

8,452

 

 

1.7

%

Restructuring charges

 

(2

)

 

%

 

 

(6

)

 

%

 

 

3

 

%

 

 

(5

)

 

%

Subtotal

 

16,191

 

 

10.0

%

 

 

(1,685

)

 

(0.7

) %

 

 

18,466

 

15.6

%

 

 

32,972

 

 

6.5

%

Amortization of intangible assets

 

514

 

 

0.3

%

 

 

1,196

 

 

0.5

%

 

 

2,406

 

2.0

%

 

 

4,116

 

 

0.8

%

Non-cash share-based compensation

 

2,254

 

 

1.4

%

 

 

2,025

 

 

0.9

%

 

 

1,485

 

1.3

%

 

 

5,764

 

 

1.1

%

Adjusted operating income (non-GAAP)

$

18,959

 

 

11.7

%

 

$

1,536

 

 

0.7

%

 

$

22,357

 

18.9

%

 

$

42,852

 

 

8.4

%

 

Fiscal Year Ended February 28, 2022

 

Home &

Outdoor (2)

 

Health & Wellness

 

Beauty

 

Total

Operating income, as reported (GAAP)

$

134,925

 

15.6

%

 

$

39,217

 

 

5.0

%

 

$

98,408

 

17.0

%

 

$

272,550

 

12.3

%

Acquisition-related expenses

 

2,424

 

0.3

%

 

 

 

 

%

 

 

 

%

 

 

2,424

 

0.1

%

EPA compliance costs

 

 

%

 

 

32,354

 

 

4.2

%

 

 

 

%

 

 

32,354

 

1.5

%

Restructuring charges

 

369

 

%

 

 

 

 

%

 

 

11

 

%

 

 

380

 

%

Subtotal

 

137,718

 

15.9

%

 

 

71,571

 

 

9.2

%

 

 

98,419

 

17.0

%

 

 

307,708

 

13.8

%

Amortization of intangible assets

 

2,891

 

0.3

%

 

 

2,284

 

 

0.3

%

 

 

7,589

 

1.3

%

 

 

12,764

 

0.6

%

Non-cash share-based compensation

 

13,812

 

1.6

%

 

 

12,001

 

 

1.5

%

 

 

8,805

 

1.5

%

 

 

34,618

 

1.6

%

Adjusted operating income (non-GAAP)

$

154,421

 

17.8

%

 

$

85,856

 

 

11.0

%

 

$

114,813

 

19.8

%

 

$

355,090

 

16.0

%

 

 

Fiscal Year Ended February 28, 2021

 

Home &

Outdoor

 

Health & Wellness

 

Beauty

 

Total

Operating income, as reported (GAAP)

$

122,487

 

16.8

%

 

$

94,103

 

 

10.6

%

 

$

64,898

 

13.5

%

 

$

281,488

 

13.4

%

Asset impairment charges

 

 

%

 

 

 

 

%

 

 

8,452

 

1.8

%

 

 

8,452

 

0.4

%

Restructuring charges

 

249

 

%

 

 

(6

)

 

%

 

 

107

 

%

 

 

350

 

%

Subtotal

 

122,736

 

16.9

%

 

 

94,097

 

 

10.6

%

 

 

73,457

 

15.3

%

 

 

290,290

 

13.8

%

Amortization of intangible assets

 

2,055

 

0.3

%

 

 

8,611

 

 

1.0

%

 

 

6,977

 

1.4

%

 

 

17,643

 

0.8

%

Non-cash share-based compensation

 

10,278

 

1.4

%

 

 

9,191

 

 

1.0

%

 

 

6,949

 

1.4

%

 

 

26,418

 

1.3

%

Adjusted operating income (non-GAAP)

$

135,069

 

18.6

%

 

$

111,899

 

 

12.6

%

 

$

87,383

 

18.2

%

 

$

334,351

 

15.9

%

 

Reconciliation of Non-GAAP Financial Measures – EBITDA

(Earnings Before Interest, Taxes, Depreciation and Amortization) and Adjusted EBITDA (6)

(Unaudited) (in thousands)

 

 

Three Months Ended February 28, 2022

 

 

 

Home & Outdoor (2)

 

Health & Wellness

 

Beauty

 

Total

Operating income, as reported (GAAP)

$

22,622

 

 

$

9,601

 

 

$

18,161

 

$

50,384

 

Depreciation and amortization

 

3,855

 

 

 

2,812

 

 

 

3,080

 

 

9,747

 

Non-operating income, net

 

 

 

 

 

 

 

75

 

 

75

 

EBITDA (non-GAAP)

 

26,477

 

 

 

12,413

 

 

 

21,316

 

 

60,206

 

Add: Acquisition-related expenses

 

819

 

 

 

 

 

 

 

 

819

 

EPA compliance costs

 

 

 

 

11,356

 

 

 

 

 

11,356

 

Non-cash share-based compensation

 

2,765

 

 

 

1,772

 

 

 

1,732

 

 

6,269

 

Adjusted EBITDA (non-GAAP)

$

30,061

 

 

$

25,541

 

 

$

23,048

 

$

78,650

 

 

 

Three Months Ended February 28, 2021

 

Home & Outdoor

 

Health & Wellness

 

Beauty

 

Total

Operating income (loss), as reported (GAAP)

$

16,193

 

 

$

(1,679

)

 

$

10,011

 

$

24,525

 

Depreciation and amortization

 

2,590

 

 

 

3,122

 

 

 

4,011

 

 

9,723

 

Non-operating income, net

 

 

 

 

 

 

 

119

 

 

119

 

EBITDA (non-GAAP)

 

18,783

 

 

 

1,443

 

 

 

14,141

 

 

34,367

 

Add: Asset impairment charges

 

 

 

 

 

 

 

8,452

 

 

8,452

 

Restructuring charges

 

(2

)

 

 

(6

)

 

 

3

 

 

(5

)

Non-cash share-based compensation

 

2,254

 

 

 

2,025

 

 

 

1,485

 

 

5,764

 

Adjusted EBITDA (non-GAAP)

$

21,035

 

 

$

3,462

 

 

$

24,081

 

$

48,578

 

 

 

Fiscal Year Ended February 28, 2022

 

Home & Outdoor (2)

 

Health & Wellness

 

Beauty

 

Total

Operating income, as reported (GAAP)

$

134,925

 

 

$

39,217

 

 

$

98,408

 

$

272,550

 

Depreciation and amortization

 

12,112

 

 

 

10,691

 

 

 

13,026

 

 

35,829

 

Non-operating income, net

 

 

 

 

 

 

 

260

 

 

260

 

EBITDA (non-GAAP)

 

147,037

 

 

 

49,908

 

 

 

111,694

 

 

308,639

 

Add: Acquisition-related expenses

 

2,424

 

 

 

 

 

 

 

 

2,424

 

EPA compliance costs

 

 

 

 

32,354

 

 

 

 

 

32,354

 

Restructuring charges

 

369

 

 

 

 

 

 

11

 

 

380

 

Non-cash share-based compensation

 

13,812

 

 

 

12,001

 

 

 

8,805

 

 

34,618

 

Adjusted EBITDA (non-GAAP)

$

163,642

 

 

$

94,263

 

 

$

120,510

 

$

378,415

 

 

 

Fiscal Year Ended February 28, 2021

 

Home & Outdoor

 

Health & Wellness

 

Beauty

 

Total

Operating income, as reported (GAAP)

$

122,487

 

 

$

94,103

 

 

$

64,898

 

$

281,488

 

Depreciation and amortization

 

9,333

 

 

 

15,453

 

 

 

12,932

 

 

37,718

 

Non-operating income, net

 

 

 

 

 

 

 

559

 

 

559

 

EBITDA (non-GAAP)

 

131,820

 

 

 

109,556

 

 

 

78,389

 

 

319,765

 

Add: Asset impairment charges

 

 

 

 

 

 

 

8,452

 

 

8,452

 

Restructuring charges

 

249

 

 

 

(6

)

 

 

107

 

 

350

 

Non-cash share-based compensation

 

10,278

 

 

 

9,191

 

 

 

6,949

 

 

26,418

 

Adjusted EBITDA (non-GAAP)

$

142,347

 

 

$

118,741

 

 

$

93,897

 

$

354,985

 

 

Reconciliation of Non-GAAP Financial Measures – GAAP Income (Loss) and Diluted EPS to Adjusted Income and Adjusted Diluted EPS (Non-GAAP) (6)

(Unaudited) (in thousands, except per share data)

 

 

Three Months Ended February 28, 2022

 

Income

 

Diluted EPS

 

Before Tax

 

Tax

 

Net of Tax

 

Before Tax

 

Tax

 

Net of Tax

As reported (GAAP)

$

47,123

 

$

7,329

 

$

39,794

 

$

1.94

 

$

0.30

 

$

1.64

Acquisition-related expenses

 

819

 

 

29

 

 

790

 

 

0.03

 

 

 

 

0.03

EPA compliance costs

 

11,356

 

 

170

 

 

11,186

 

 

0.47

 

 

0.01

 

 

0.46

Subtotal

 

59,298

 

 

7,528

 

 

51,770

 

 

2.44

 

 

0.31

 

 

2.13

Amortization of intangible assets

 

3,801

 

 

407

 

 

3,394

 

 

0.16

 

 

0.02

 

 

0.14

Non-cash share-based compensation

 

6,269

 

 

610

 

 

5,659

 

 

0.26

 

 

0.03

 

 

0.23

Adjusted (non-GAAP)

$

69,368

 

$

8,545

 

$

60,823

 

$

2.86

 

$

0.35

 

$

2.51

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares of common stock used in computing diluted EPS

 

 

24,259

 

Three Months Ended February 28, 2021

 

Income

 

Diluted EPS

 

Before Tax

 

Tax

 

Net of Tax

 

Before Tax

 

Tax

 

Net of Tax

As reported (GAAP)

$

21,595

 

 

$

(577

)

 

$

22,172

 

 

$

0.87

 

$

(0.02

)

 

$

0.90

Asset impairment charges

 

8,452

 

 

 

1,009

 

 

 

7,443

 

 

 

0.34

 

 

0.04

 

 

 

0.30

Restructuring charges

 

(5

)

 

 

 

 

 

(5

)

 

 

 

 

 

 

 

Subtotal

 

30,042

 

 

 

432

 

 

 

29,610

 

 

 

1.21

 

 

0.02

 

 

 

1.20

Amortization of intangible assets

 

4,116

 

 

 

214

 

 

 

3,902

 

 

 

0.17

 

 

0.01

 

 

 

0.16

Non-cash share-based compensation

 

5,764

 

 

 

520

 

 

 

5,244

 

 

 

0.23

 

 

0.02

 

 

 

0.21

Adjusted (non-GAAP)

$

39,922

 

 

$

1,166

 

 

$

38,756

 

 

$

1.61

 

$

0.05

 

 

$

1.57

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares of common stock used in computing diluted EPS

 

 

24,737

 

Three Months Ended February 29, 2020

 

(Loss) Income

 

Diluted EPS

 

Before Tax

 

Tax

 

Net of Tax

 

Before Tax

 

Tax

 

Net of Tax

As reported (GAAP)

$

(6,078

)

 

$

(2,923

)

 

$

(3,155

)

 

$

(0.24

)

 

$

(0.12

)

 

$

(0.13

)

Acquisition-related expenses

 

1,071

 

 

 

16

 

 

 

1,055

 

 

 

0.04

 

 

 

 

 

 

0.04

 

Asset impairment charges

 

41,000

 

 

 

4,574

 

 

 

36,426

 

 

 

1.61

 

 

 

0.18

 

 

 

1.43

 

Restructuring charges

 

2,252

 

 

 

93

 

 

 

2,159

 

 

 

0.09

 

 

 

 

 

 

0.08

 

Subtotal

 

38,245

 

 

 

1,760

 

 

 

36,485

 

 

 

1.51

 

 

 

0.07

 

 

 

1.44

 

Amortization of intangible assets

 

8,142

 

 

 

624

 

 

 

7,518

 

 

 

0.32

 

 

 

0.02

 

 

 

0.30

 

Non-cash share-based compensation

 

4,186

 

 

 

369

 

 

 

3,817

 

 

 

0.16

 

 

 

0.01

 

 

 

0.15

 

Adjusted (non-GAAP)

$

50,573

 

 

$

2,753

 

 

$

47,820

 

 

$

1.99

 

 

$

0.11

 

 

$

1.88

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares of common stock used in computing diluted EPS

 

 

25,403

 

Reconciliation of Non-GAAP Financial Measures – GAAP Income and Diluted EPS to Adjusted Income and Adjusted Diluted EPS (Non-GAAP) (6)

(Unaudited) (in thousands, except per share data)

 

 

Fiscal Year Ended February 28, 2022

 

Income

 

Diluted EPS

 

Before Tax

 

Tax

 

Net of Tax

 

Before Tax

 

Tax

 

Net of Tax

As reported (GAAP)

$

259,966

 

$

36,202

 

$

223,764

 

 

$

10.65

 

$

1.48

 

$

9.17

 

Acquisition-related expenses

 

2,424

 

 

87

 

 

2,337

 

 

 

0.10

 

 

 

 

0.10

 

EPA compliance costs

 

32,354

 

 

485

 

 

31,869

 

 

 

1.33

 

 

0.02

 

 

1.31

 

Restructuring charges

 

380

 

 

6

 

 

374

 

 

 

0.02

 

 

 

 

0.02

 

Subtotal

 

295,124

 

 

36,780

 

 

258,344

 

 

 

12.09

 

 

1.51

 

 

10.58

 

Amortization of intangible assets

 

12,764

 

 

1,010

 

 

11,754

 

 

 

0.52

 

 

0.04

 

 

0.48

 

Non-cash share-based compensation

 

34,618

 

 

2,965

 

 

31,653

 

 

 

1.42

 

 

0.12

 

 

1.30

 

Adjusted (non-GAAP)

$

342,506

 

$

40,755

 

$

301,751

 

 

$

14.03

 

$

1.67

 

$

12.36

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares of common stock used in computing diluted EPS

 

 

24,410

 

 

 

Fiscal Year Ended February 28, 2021

 

Income

 

Diluted EPS

 

Before Tax

 

Tax

 

Net of Tax

 

Before Tax

 

Tax

 

Net of Tax

As reported (GAAP)

$

269,430

 

$

15,484

 

$

253,946

 

 

$

10.69

 

$

0.61

 

$

10.08

 

Asset impairment charges

 

8,452

 

 

1,009

 

 

7,443

 

 

 

0.34

 

 

0.04

 

 

0.30

 

Restructuring charges

 

350

 

 

2

 

 

348

 

 

 

0.01

 

 

 

 

0.01

 

Tax reform

 

 

 

9,357

 

 

(9,357

)

 

 

 

 

0.37

 

 

(0.37

)

Subtotal

 

278,232

 

 

25,852

 

 

252,380

 

 

 

11.04

 

 

1.03

 

 

10.02

 

Amortization of intangible assets

 

17,643

 

 

865

 

 

16,778

 

 

 

0.70

 

 

0.03

 

 

0.67

 

Non-cash share-based compensation

 

26,418

 

 

1,926

 

 

24,492

 

 

 

1.05

 

 

0.08

 

 

0.97

 

Adjusted (non-GAAP)

$

322,293

 

$

28,643

 

$

293,650

 

 

$

12.79

 

$

1.14

 

$

11.65

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares of common stock used in computing diluted EPS

 

 

25,196

 

 

 

Fiscal Year Ended February 29, 2020

 

Income

 

Diluted EPS

 

Before Tax

 

Tax

 

Net of Tax

 

Before Tax

 

Tax

 

Net of Tax

As reported (GAAP)

$

165,940

 

$

13,607

 

$

152,333

 

 

$

6.55

 

$

0.54

 

$

6.02

 

Acquisition-related expenses

 

2,546

 

 

38

 

 

2,508

 

 

 

0.10

 

 

 

 

0.10

 

Asset impairment charges

 

41,000

 

 

4,574

 

 

36,426

 

 

 

1.62

 

 

0.18

 

 

1.44

 

Restructuring charges

 

3,313

 

 

161

 

 

3,152

 

 

 

0.13

 

 

0.01

 

 

0.12

 

Subtotal

 

212,799

 

 

18,380

 

 

194,419

 

 

 

8.40

 

 

0.73

 

 

7.68

 

Amortization of intangible assets

 

21,271

 

 

1,245

 

 

20,026

 

 

 

0.84

 

 

0.05

 

 

0.79

 

Non-cash share-based compensation

 

22,929

 

 

1,803

 

 

21,126

 

 

 

0.91

 

 

0.07

 

 

0.83

 

Adjusted (non-GAAP)

$

256,999

 

$

21,428

 

$

235,571

 

 

$

10.15

 

$

0.85

 

$

9.30

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares of common stock used in computing diluted EPS

 

 

25,322

 

 

Consolidated Core and Non-Core Net Sales and Reconciliation of Non-GAAP Financial Measures – Core and Non-Core Adjusted Diluted EPS (Non-GAAP) (3) (6)

(Unaudited) (in thousands, except per share data)

 

 

Three Months Ended Last Day of February,

 

2022

 

2021

 

$ Change

 

% Change

Sales revenue, net

 

 

 

 

 

 

 

Core

$

578,141

 

$

493,458

 

$

84,683

 

 

17.2

%

Non-Core

 

3,879

 

 

15,917

 

 

(12,038

)

 

(75.6

) %

Total

$

582,020

 

$

509,375

 

$

72,645

 

 

14.3

%

 

 

Three Months Ended Last Day of February,

 

2022

 

2021

 

$ Change

 

% Change

Adjusted Diluted EPS (non-GAAP)

 

 

 

 

 

 

 

Core

$

2.51

 

$

1.42

 

$

1.09

 

 

76.8

%

Non-Core

 

 

 

0.15

 

 

(0.15

)

 

(100.0

) %

Total

$

2.51

 

$

1.57

 

$

0.94

 

 

59.9

%

Three Months Ended Last Day of February, Core Business:

2022

2021

Diluted EPS, as reported

$

1.64

$

1.05

 

Acquisition-related expenses, net of tax

 

0.03

 

 

EPA compliance costs, net of tax

 

0.46

 

 

Subtotal

 

2.13

 

1.05

 

Amortization of intangible assets, net of tax

 

0.14

 

0.16

 

Non-cash share-based compensation, net of tax

 

0.23

 

0.21

 

Adjusted Diluted EPS (non-GAAP)

$

2.51

$

1.42

 

  Three Months Ended Last Day of February, Non-Core Business:

2022

2021

Diluted EPS, as reported

$

$

(0.15

)

Asset impairment charges, net of tax

 

 

0.30

 

Adjusted Diluted EPS (non-GAAP)

$

$

0.15

 

  Diluted EPS, as reported (GAAP)

$

1.64

$

0.90

 

 

Consolidated Core and Non-Core Net Sales and Reconciliation of Non-GAAP Financial Measures – Core and Non-Core Adjusted Diluted EPS (Non-GAAP) (3) (6)

(Unaudited) (in thousands, except per share data)

 

 

Fiscal Years Ended Last Day of February,

 

 2022

 

 2021

 

$ Change

 

% Change

Sales revenue, net

 

 

 

 

 

 

 

Core

$

2,189,239

 

$

2,020,453

 

$

168,786

 

 

8.4

%

Non-Core

 

34,116

 

 

78,346

 

 

(44,230

)

 

(56.5

)%

Total

$

2,223,355

 

$

2,098,799

 

$

124,556

 

 

5.9

%

 

 

Fiscal Years Ended Last Day of February,

 

 2022

 

 2021

 

$ Change

 

% Change

Adjusted Diluted EPS (non-GAAP)

 

 

 

 

 

 

 

Core

$

12.18

 

$

11.03

 

$

1.15

 

 

10.4

%

Non-Core

 

0.18

 

 

0.62

 

 

(0.44

)

 

(71.0

)%

Total

$

12.36

 

$

11.65

 

$

0.71

 

 

6.1

%

Fiscal Years Ended Last Day of February,

Core Business:

2022

2021

Diluted EPS, as reported

$

9.00

$

9.76

 

Acquisition-related expenses, net of tax

 

0.10

 

 

EPA compliance costs, net of tax

 

1.31

 

 

Restructuring charges, net of tax

 

0.02

 

0.01

 

Tax Reform

 

 

(0.37

)

Subtotal

 

10.41

 

9.40

 

Amortization of intangible assets, net of tax

 

0.48

 

0.67

 

Non-cash share-based compensation, net of tax

 

1.29

 

0.97

 

Adjusted Diluted EPS (non-GAAP)

$

12.18

$

11.03

 

 

Fiscal Years Ended Last Day of February,

Non-Core Business:

2022

2021

Diluted EPS, as reported

$

0.17

$

0.32

 

Asset impairment charges, net of tax

 

 

0.30

 

Subtotal

 

0.17

 

0.62

 

Non-cash share-based compensation, net of tax

 

0.01

 

 

Adjusted Diluted EPS (non-GAAP)

$

0.18

$

0.62

 

  Diluted EPS, as reported (GAAP)

$

9.17

$

10.08

 

 

Reconciliation of Non-GAAP Financial Measures – Core and Non-Core GAAP Operating Income (Loss) to Core and Non-Core Adjusted Operating Income (Non-GAAP) (3) (6)

(Unaudited) (in thousands)

 

 

Fiscal Year Ended February 28, 2022

 

Core Business

 

Non-Core Business

 

Consolidated

Operating income, as reported (GAAP)

$

267,004

 

12.2

%

 

$

5,546

 

 

16.3

%

 

$

272,550

 

12.3

%

Acquisition-related expenses

 

2,424

 

0.1

%

 

 

 

 

%

 

 

2,424

 

0.1

%

EPA compliance costs

 

32,354

 

1.5

%

 

 

 

 

%

 

 

32,354

 

1.5

%

Restructuring charges

 

380

 

%

 

 

 

 

%

 

 

380

 

%

Subtotal

 

302,162

 

13.8

%

 

 

5,546

 

 

16.3

%

 

 

307,708

 

13.8

%

Amortization of intangible assets

 

12,764

 

0.6

%

 

 

 

 

%

 

 

12,764

 

0.6

%

Non-cash share-based compensation

 

34,386

 

1.6

%

 

 

232

 

 

0.7

%

 

 

34,618

 

1.6

%

Adjusted operating income (non-GAAP)

$

349,312

 

16.0

%

 

$

5,778

 

 

16.9

%

 

$

355,090

 

16.0

%

 

 

Fiscal Year Ended February 28, 2021

 

Core Business

 

Non-Core Business

 

Consolidated

Operating income, as reported (GAAP)

$

272,783

 

13.5

%

 

$

8,705

 

 

11.1

%

 

$

281,488

 

13.4

%

Asset impairment charges

 

 

%

 

 

8,452

 

 

10.8

%

 

 

8,452

 

0.4

%

Restructuring charges

 

350

 

%

 

 

 

 

%

 

 

350

 

%

Subtotal

 

273,133

 

13.5

%

 

 

17,157

 

 

21.9

%

 

 

290,290

 

13.8

%

Amortization of intangible assets

 

17,643

 

0.9

%

 

 

 

 

%

 

 

17,643

 

0.8

%

Non-cash share-based compensation

 

26,203

 

1.3

%

 

 

215

 

 

0.3

%

 

 

26,418

 

1.3

%

Adjusted operating income (non-GAAP)

$

316,979

 

15.7

%

 

$

17,372

 

 

22.2

%

 

$

334,351

 

15.9

%

 

 

Fiscal Year Ended February 29, 2020

 

Core Business

 

Non-Core Business

 

Consolidated

Operating income (loss), as reported (GAAP)

$

208,011

 

12.9

%

 

$

(29,760

)

 

(32.2

) %

 

$

178,251

 

10.4

%

Acquisition-related expenses

 

2,546

 

0.2

%

 

 

 

 

%

 

 

2,546

 

0.1

%

Asset impairment charges

 

 

%

 

 

41,000

 

 

44.4

%

 

 

41,000

 

2.4

%

Restructuring charges

 

2,817

 

0.2

%

 

 

496

 

 

0.5

%

 

 

3,313

 

0.2

%

Subtotal

 

213,374

 

13.2

%

 

 

11,736

 

 

12.7

%

 

 

225,110

 

13.2

%

Amortization of intangible assets

 

13,511

 

0.8

%

 

 

7,760

 

 

8.4

%

 

 

21,271

 

1.2

%

Non-cash share-based compensation

 

22,496

 

1.4

%

 

 

433

 

 

0.5

%

 

 

22,929

 

1.3

%

Adjusted operating income (non-GAAP)

$

249,381

 

15.4

%

 

$

19,929

 

 

21.6

%

 

$

269,310

 

15.8

%

 

 

Fiscal Year Ended February 28, 2019

 

Core Business

 

Non-Core Business

 

Consolidated

Operating income, as reported (GAAP)

$

176,189

 

12.1

%

 

$

23,190

 

 

22.5

%

 

$

199,379

 

12.7

%

Restructuring charges

 

3,224

 

0.2

%

 

 

362

 

 

0.4

%

 

 

3,586

 

0.2

%

Subtotal

 

179,413

 

12.3

%

 

 

23,552

 

 

22.8

%

 

 

202,965

 

13.0

%

Amortization of intangible assets

 

13,215

 

0.9

%

 

 

989

 

 

1.0

%

 

 

14,204

 

0.9

%

Non-cash share-based compensation

 

21,777

 

1.5

%

 

 

276

 

 

0.3

%

 

 

22,053

 

1.4

%

Adjusted operating income (non-GAAP)

$

214,405

 

14.7

%

 

$

24,817

 

 

24.0

%

 

$

239,222

 

15.3

%

 

Selected Consolidated Balance Sheet, Cash Flow and Liquidity Information

(Unaudited) (in thousands)

 

 

Last Day of February,

 

2022

 

2021

Balance Sheet:

 

 

 

Cash and cash equivalents

$

33,381

 

 

$

45,120

 

Receivables, net

 

457,623

 

 

 

382,449

 

Inventory

 

557,992

 

 

 

481,611

 

Assets held for sale

 

1,942

 

 

 

39,867

 

Total assets, current

 

1,082,080

 

 

 

971,937

 

Total assets

 

2,823,451

 

 

 

2,263,488

 

Total liabilities, current

 

602,690

 

 

 

614,892

 

Total long-term liabilities

 

893,422

 

 

 

409,249

 

Total debt

 

813,216

 

 

 

343,630

 

Stockholders’ equity

 

1,327,339

 

 

 

1,239,347

 

Liquidity:

 

 

 

Working capital

$

479,390

 

 

$

357,045

 

 

 

Fiscal Years Ended Last Day of February,

 

2022

 

2021

Cash Flow:

 

 

 

Depreciation and amortization

$

35,829

 

 

$

37,718

 

Net cash provided by operating activities

 

140,823

 

 

 

314,106

 

Capital and intangible asset expenditures

 

78,039

 

 

 

98,668

 

Net debt proceeds

 

468,600

 

 

 

7,100

 

Payments for repurchases of common stock

 

188,204

 

 

 

203,294

 

   

Reconciliation of Non-GAAP Financial Measures – GAAP Net Cash Provided by Operating Activities to Free Cash Flow (Non-GAAP) (6)

(Unaudited) (in thousands)

 

 

Fiscal Years Ended Last Day of February,

 

2022

 

2021

Net cash provided by operating activities (GAAP)

$

140,823

 

 

$

314,106

 

Less: Capital and intangible asset expenditures

 

(78,039

)

 

 

(98,668

)

Free cash flow (non-GAAP)

$

62,784

 

 

$

215,438

 

 

Fiscal 2023 Outlook for Net Sales Revenue (3)

(Unaudited)

(in thousands)

 

Consolidated:

Fiscal 2022

Outlook Fiscal 2023

Net sales revenue

$

2,223,355

$

2,375,000

 

$

2,420,000

 

Net sales revenue growth

 

 

6.8

%

 

8.8

%

 

Core Business:

 

 

Net sales revenue

$

2,189,239

$

2,375,000

 

$

2,420,000

 

Net sales revenue growth

 

 

8.5

%

 

10.5

%

 

Reconciliation of Non-GAAP Financial Measures – Fiscal 2023 Outlook for GAAP Diluted Earnings Per Share (“EPS”) to Adjusted Diluted EPS (Non-GAAP) (3) (6) (Unaudited)

 

Consolidated:

Fiscal Year Ended February 28, 2022

Outlook Fiscal 2023

Diluted EPS, as reported (GAAP)

$

9.17

$

9.92

 

$

10.38

 

Acquisition-related expenses, net of tax

 

0.10

 

0.05

 

 

0.03

 

EPA compliance costs, net of tax

 

1.31

 

0.72

 

 

0.62

 

Restructuring charges, net of tax

 

0.02

 

 

 

 

Subtotal

 

10.58

 

10.69

 

 

11.03

 

Amortization of intangible assets, net of tax

 

0.48

 

0.69

 

 

0.67

 

Non-cash share-based compensation, net of tax

 

1.30

 

1.35

 

 

1.33

 

Adjusted diluted EPS (non-GAAP)

$

12.36

$

12.73

 

$

13.03

 

 

 

 

 

 

Adjusted diluted EPS (non-GAAP) growth

 

 

3.0

%

 

5.4

%

 

Core Business:

Fiscal Year Ended February 28, 2022

Outlook Fiscal 2023

Diluted EPS, as reported (GAAP)

$

9.00

$

9.92

 

$

10.38

 

Acquisition-related expenses, net of tax

 

0.10

 

0.05

 

 

0.03

 

EPA compliance costs, net of tax

 

1.31

 

0.72

 

 

0.62

 

Restructuring charges, net of tax

 

0.02

 

 

 

 

Subtotal

 

10.41

 

10.69

 

 

11.03

 

Amortization of intangible assets, net of tax

 

0.48

 

0.69

 

 

0.67

 

Non-cash share-based compensation, net of tax

 

1.29

 

1.35

 

 

1.33

 

Adjusted diluted EPS (non-GAAP)

$

12.18

$

12.73

 

$

13.03

 

 

 

 

 

 

Adjusted diluted EPS (non-GAAP) growth

 

 

4.5

%

 

7.0

%

 

Reconciliation of Non-GAAP Financial Measures – Fiscal 2023 Outlook for Effective Tax Rate (GAAP) to Adjusted Effective Tax Rate (Non-GAAP) (3) (6) (Unaudited)

 

Consolidated & Core Business:

Outlook Fiscal 2023

Effective tax rate, as reported (GAAP)

13.0

%

 

 

14.0

%

Acquisition-related expenses

%

 

 

%

EPA compliance costs

(0.7

)%

 

 

(0.6

)%

Subtotal

12.3

%

 

 

13.4

%

Amortization of intangible assets

(0.2

)%

 

 

(0.2

)%

Non-cash share-based compensation

(0.4

)%

 

 

(0.5

)%

Adjusted effective tax rate (non-GAAP)

11.7

%

 

 

12.7

%

HELEN OF TROY LIMITED AND SUBSIDIARIES

Notes to Press Release

  1. Organic business refers to net sales revenue associated with product lines or brands after the first twelve months from the date the product line or brand is acquired, excluding the impact that foreign currency remeasurement had on reported net sales revenue. Net sales revenue from internally developed brands or product lines is considered Organic business activity.
  2. Fiscal 2022 includes approximately nine weeks of operating results from Osprey, acquired on December 29, 2021.
  3. The Company defines Core business as strategic business that it expects to be an ongoing part of its operations, and Non-Core business as business or net assets (including net assets held for sale) that it expects to divest within a year of its designation as Non-Core.
  4. Leadership Brand net sales consists of revenue from the OXO, Hydro Flask, Osprey, Vicks, Braun, Honeywell, PUR, Hot Tools and Drybar.
  5. Online channel net sales revenue includes direct to consumer online net sales, net sales to retail customers fulfilling end-consumer online orders and net sales to pure-play online retailers.
  6. This press release contains non-GAAP financial measures. Adjusted Operating Income, Adjusted Operating Margin, Core and Non-Core Adjusted Operating Income, Core and Non-Core Adjusted Operating Margin, Adjusted Effective Tax Rate, Core Adjusted Effective Tax Rate, Adjusted Income, Adjusted Diluted EPS, Core and Non-Core Adjusted Diluted EPS, EBITDA, Adjusted EBITDA and Free Cash Flow (“Non-GAAP Financial Measures”) that are discussed in the accompanying press release or in the preceding tables may be considered non-GAAP financial information as contemplated by SEC Regulation G, Rule 100. Accordingly, the Company is providing the preceding tables that reconcile these measures to their corresponding GAAP-based measures. The Company believes that these non-GAAP measures provide useful information to management and investors regarding financial and business trends relating to its financial condition and results of operations. The Company believes that these non-GAAP financial measures, in combination with the Company’s financial results calculated in accordance with GAAP, provide investors with additional perspective regarding the impact of certain charges and benefits on applicable income, margin and earnings per share measures. The Company also believes that these non-GAAP measures facilitate a more direct comparison of the Company’s performance with its competitors. The Company further believes that including the excluded charges and benefits would not accurately reflect the underlying performance of the Company’s operations for the period in which the charges and benefits are incurred, even though such charges and benefits may be incurred and reflected in the Company’s GAAP financial results in the near future. The material limitation associated with the use of the non-GAAP measures is that the non-GAAP measures do not reflect the full economic impact of the Company’s activities. These non-GAAP measures are not prepared in accordance with GAAP, are not an alternative to GAAP financial information, and may be calculated differently than non-GAAP financial information disclosed by other companies. Accordingly, undue reliance should not be placed on non-GAAP information.
  7. Charges incurred in conjunction with EPA packaging compliance for certain products in the air filtration, water filtration and humidification categories within the Health & Wellness segment.
  8. Acquisition-related expenses associated with the definitive agreement to acquire Osprey included in SG&A for the fiscal quarter and year ended February 28, 2022.
  9. Amortization of intangible assets.
  10. Non-cash share-based compensation.
  11. Asset impairment charges related to goodwill and intangible assets. The impairment charges were related to assets of the Personal Care business classified as held for sale within the Beauty segment
  12. Charges incurred in connection with the Company’s restructuring plan (Project Refuel).

Investor Contact: Helen of Troy Limited Anne Rakunas, Director, External Communications (915) 225-4841

ICR, Inc. Allison Malkin, Partner (203) 682-8200

Helen of Troy (NASDAQ:HELE)
Historical Stock Chart
From Nov 2022 to Dec 2022 Click Here for more Helen of Troy Charts.
Helen of Troy (NASDAQ:HELE)
Historical Stock Chart
From Dec 2021 to Dec 2022 Click Here for more Helen of Troy Charts.