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|Hain Celestial Reports Strong Fourth Quarter And Fiscal Year 2011 Results Driven By Solid Execution And Consumer Demand For Natural And Organic Products|
Sales in the Fourth Quarter Increased 31%; Diluted EPS Increased 75% in the Fourth Quarter; Full Year Sales Increased 23% and Diluted EPS Increased 78%
Improved Gross Profit and Operating Margin
MELVILLE, N.Y., Aug. 23, 2011 /PRNewswire via COMTEX/ -- The Hain Celestial Group, Inc. (NASDAQ: HAIN), a leading natural and organic products company providing consumers with A Healthy Way of Life(TM), today reported its results for the fourth quarter and fiscal year ended June 30, 2011.
Fourth Quarter Fiscal Year 2011
Fiscal Year 2011
Fourth Quarter Fiscal Year 2011 Results
Net sales in the 2011 fourth quarter increased 31.1% to a record $292.0 million as compared to net sales of $222.8 million in the fourth quarter of fiscal year 2010. The Company's growth momentum continued across its worldwide portfolio of brands in various classes of trade including natural, grocery, club, mass and dot-com channels coupled with contributions from strategic acquisitions. The Company earned $12.8 million in net income as compared to $6.7 million in the fourth quarter of the prior year and reported diluted earnings per share of $0.28 as compared to $0.16 in the fourth quarter of the prior year. Adjusted earnings per diluted share was $0.35 on adjusted net income of $15.7 million in the 2011 fourth quarter as compared to $0.25 per share on adjusted net income of $10.6 million in the prior year fourth quarter. Adjusted net income and diluted earnings per share improved 48% and 40%, respectively, over the prior year fourth quarter. The Company's 2011 fourth quarter adjusted net income excludes acquisition related items, a discrete tax item and the impact of an impairment charge on properties related to discontinued operations at the Company's unconsolidated Hain Pure Protein investment.
Gross profit in the fourth quarter improved 186 basis points to 27.9% of net sales, as compared to the prior year fourth quarter, on the strength of a favorable mix of product sales worldwide and productivity savings, which helped offset increased input costs. In the 2011 fourth quarter, selling, general and administrative expenses were flat on a GAAP basis at 18.4% of net sales when compared to the prior year fourth quarter. Operating margin was 9.5%, an improvement of 373 basis points on a GAAP basis and 153 basis points on an adjusted basis, as compared to the prior year fourth quarter.
"Our fourth quarter results complete a strong year across our business with solid top- and bottom-line performance by the Company," said Irwin D. Simon, President and Chief Executive Officer of Hain Celestial. "Indications are that despite ongoing challenges in the economy, consumers continue to seek out healthful products from our natural and organic brands."
Fiscal Year 2011 Results
For the 2011 fiscal year the Company reported record net sales of $1.13 billion, an increase of 23.2% from the prior year net sales of $917.3 million, reflecting growth across its worldwide portfolio including acquisitions. The Company earned $55.0 million in net income as compared to $28.6 million in the prior year and reported earnings of $1.23 per diluted share as compared to earnings of $0.69 per diluted share in the prior year. Adjusted earnings per diluted share were $1.35 on adjusted net income of $60.2 million for the year as compared to $1.01 earnings per diluted share on adjusted net income of $42.0 in the prior year. On an adjusted basis, net income and diluted earnings improved 43% and 34%, respectively, over the prior year.
Gross profit in the fiscal year improved 89 basis points to 28.3% of net sales compared to 27.4% of net sales in the prior year. The higher gross profit performance resulted from the favorable mix of product sales along with productivity savings, which partially offset increased input costs. Operating margin was 9.4% on a GAAP basis this year, a 168 basis point improvement from 7.8% in the prior year. Selling, general and administrative expenses were flat at 18.8% of net sales for the year. On an adjusted basis, operating margin was 9.5% this year, a 75 basis point improvement from 8.8% in the prior year.
Balance Sheet Highlights
Fiscal Year 2011 Highlights
The Company highlighted several of its accomplishments during fiscal year 2011:
"We have focused on our core business and successfully integrated strategic acquisitions as part of our targeted execution and long-term strategy for sustainable growth. We plan to build upon these accomplishments in the future with the support of our customers, consumers, employees and shareholders," concluded Irwin Simon.
Fiscal Year 2012 Company Estimates
The Company provided the following estimates for its fiscal year 2012:
Guidance is provided on a non-GAAP basis and therefore excludes acquisition and integration expenses that may be incurred during the Company's fiscal year 2012, which the Company will continue to identify when it reports its financial results. Historically, the Company's sales and earnings are strongest in its second and third quarters.
Hain Celestial will host a conference call and webcast at 4:30 PM Eastern Time today to review its fourth quarter and fiscal year 2011 results. The conference call will be webcast and available under the Investor Relations section of the Company's website at http://www.hain-celestial.com/.
The Hain Celestial Group, Inc.
The Hain Celestial Group, Inc. (NASDAQ: HAIN), headquartered in Melville, NY, is a leading natural and organic products company in North America and Europe. Hain Celestial participates in many natural categories with well-known brands that include Celestial Seasonings®, Earth's Best®, Terra®, Garden of Eatin'®, Sensible Portions®, Health Valley®, Arrowhead Mills®, MaraNatha®, SunSpire®, DeBoles®, Gluten Free Cafe(TM), Hain Pure Foods®, Hollywood®, Spectrum Naturals®, Spectrum Essentials®, Walnut Acres Organic®, Westbrae®, Imagine®, Almond Dream®, Rice Dream®, Soy Dream®, WestSoy®, The Greek Gods®, Rosetto®, Ethnic Gourmet®, Casbah®, Yves Veggie Cuisine®, Linda McCartney®, Daily Bread(TM), Lima®, Danival®, GG UniqueFiber(TM), Grains Noirs®, Natumi®, JASON®, Zia® Natural Skincare, Avalon Organics®, Alba Botanica®, Queen Helene®, Tushies®, Earth's Best TenderCare® and Martha Stewart Clean(TM). Hain Celestial has been providing "A Healthy Way of Life(TM)" since 1993. For more information, visit www.hain-celestial.com.
Non-GAAP Financial Measures
This press release and the accompanying tables include non-GAAP financial measures, which are also referred to as "adjusted." The reconciliations of these non-GAAP financial measures to the comparable GAAP financial measures are presented in the tables "Consolidated Statements of Income with Adjustments" for the three months and years ended June 30, 2011 and 2010. Management believes that the non-GAAP financial measures presented provide useful additional information to investors about current trends in the Company's operations and are useful for period-over-period comparisons of operations. These non-GAAP financial measures should not be considered in isolation or as a substitute for the comparable GAAP measures. In addition, these non-GAAP measures may not be the same as similar measures provided by other companies due to potential differences in methods of calculation and items being excluded. They should be read only in connection with the Company's Consolidated Statements of Income presented in accordance with GAAP.
Operating Free Cash Flow is a non-GAAP financial measure. The Company defines Operating Free Cash Flow as cash provided from or used in operating activities less capital expenditures. We view operating free cash flow as an important measure because it is one factor in evaluating the amount of cash available for discretionary investments. For the fiscal year ended June 30, 2011, cash provided by operating activities was $58.7 million and capital expenditures were $11.5 million for a net total of $47.2 million.
Safe Harbor Statement
This press release contains forward-looking statements under Rule 3b-6 of the Securities Exchange Act of 1934, as amended. Words such as "plan," "continue," "expect," "expected," "anticipate," "estimate," "believe," "may," "potential," "can," "positioned," "should," "future," "look forward" and similar expressions, or the negative of those expressions, may identify forward-looking statements. Forward-looking statements involve known and unknown risks and uncertainties, which could cause the Company's actual results to differ materially from those described in the forward-looking statements. These forward-looking statements include the Company's expectations relating to (i) the Company's guidance for net sales and earnings per diluted share in fiscal year 2012; (ii) consumer demand for healthful products from the Company's brands; and (iii) the Company's ability to continue to integrate strategic acquisitions as part of its targeted execution and long-term strategy for sustainable growth. These risks include but are not limited to the Company's ability to achieve its guidance for net sales and earnings per diluted share in fiscal year 2012 given the economic environment in the U.S. and other markets that it sell products as well as economic, political and business conditions generally and their effect on the Company's customers and consumers' product preferences, and the Company's business, financial condition and results of operations; the Company's expectations for its business for fiscal year 2012 and its positioning for the future; changes in estimates or judgments related to the Company's impairment analysis of goodwill and other intangible assets, as well as with respect to the Company's valuation allowances of its deferred tax assets; the Company's ability to implement its business and acquisition strategy, including its strategy for improving results in the United Kingdom; the ability of the Company's joint ventures, including Hain Pure Protein Corporation, to successfully implement their business plans; the Company's ability to realize sustainable growth generally and from investment in core brands, offering new products and its focus on cost containment, productivity, cash flow and margin enhancement in particular; the Company's ability to effectively integrate its acquisitions; competition; the success and cost of introducing new products as well as the Company's ability to increase prices on existing products; the availability and retention of key personnel; the Company's reliance on third party distributors, manufacturers and suppliers; the Company's ability to maintain existing contracts and secure and integrate new customers; the Company's ability to respond to changes and trends in customer and consumer demand, preferences and consumption; international sales and operations; changes in fuel and commodity costs; the effects on the Company's results of operations from adverse impacts of foreign exchange; changes in, or the failure to comply with, government regulations; the availability of natural and organic ingredients; the Company's reliance on its information technology systems; and other risks detailed from time-to-time in the Company's reports filed with the Securities and Exchange Commission, including the annual report on Form 10-K for the fiscal year ended June 30, 2010. As a result of the foregoing and other factors, no assurance can be given as to future results, levels of activity and achievements and neither the Company nor any person assumes responsibility for the accuracy and completeness of these statements.
SOURCE The Hain Celestial Group, Inc.