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United States securities and exchange commission logo
March 15, 2024
Lee Boyce
Executive Vice President and Chief Financial Officer
HAIN CELESTIAL GROUP INC
221 River Street
Hoboken, New Jersey 07030
Re: HAIN CELESTIAL
GROUP INC
Form 10-K for the
Fiscal Year Ended June 30, 2023
Filed August 24,
2023
File No. 000-22818
Dear Lee Boyce:
We have limited our review of your filing to the financial
statements and related
disclosures and have the following comments.
Please respond to this letter within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe a
comment applies to your facts and circumstances, please tell us why in
your response.
After reviewing your
response to this letter, we may have additional comments.
Form 10-K for the Fiscal Year Ended June 30, 2023
Management's Discussion and Analysis of Financial Condition and Results
of Operations
Reconciliation of Non US GAAP Financial Measures to US GAAP Financial
Measures, page 34
1. We note your non-GAAP
adjustments related to "Litigation and related costs" and
"Productivity and
transformation costs". We also note similar adjustments in subsequent
Form 10-Qs and an
additional non-GAAP adjustment related to "inventory write-downs
related to exited
categories". Please describe to us, in greater detail, the specific nature of
these adjustments and
explain how you determined they are appropriate based on the
guidance in Question
100.01 of the Division of Corporation Finance's Compliance
& Disclosure
Interpretations on Non-GAAP Financial Measures since it appears to us they
may represent normal
operating expenses related to your business. For the annual and
subsequent interim
periods presented, specifically address the following items.
For litigation and
related costs, quantify amounts related to the securities class action
and the baby food
litigation. For legal costs related to your products, explain why the
costs are not
normal operating expenses.
Lee Boyce
FirstName LastNameLee Boyce
HAIN CELESTIAL GROUP INC
Comapany
March NameHAIN CELESTIAL GROUP INC
15, 2024
March2 15, 2024 Page 2
Page
FirstName LastName
For productivity and transformation costs, quantify and clarify
the specific nature of
the costs and activities. In this regard, we note disclosures that
the transformation
program is intended to improve profitability, build brands, and
delivery future
growth. Explain why the costs are not normal operating expenses.
Based on the nature of your business, including the acquisition
and disposition of
brands, explain how you determined inventory write-downs are not
normal
operating expenses.
Please be advised this comment is also applicable to the same
adjustments included in the
multiple additional non-GAAP financial measures you present in
Earnings Releases filed
under Form 8-K.
Critical Accounting Estimates
Goodwill and Intangible Assets, page 38
2. We note you disclose the estimated fair values of your reporting units
exceeded their
carrying values. We also note the material intangible asset impairment
charges you
recorded during the year ended June 30, 2023, the significant goodwill
balance at June 30,
2023, and the fact that net book value exceeds market capitalization.
Please more fully
explain to us how you determined the estimated fair values of your
reporting units
exceeded their carrying values. In addition, due to the significant
goodwill balance at June
30, 2023, it appears reasonably possible that a goodwill impairment
could materially
impact your financial statements. Revise your future filings to
address the following
items.
Disclose whether you performed additional impairment tests since
the most recent
annual impairments test and explain why or why not.
Disclose the number of reporting units you have with goodwill and
the numbers of
reporting units for which you performed quantitative or
qualitative impairment tests
as of the most recent impairment test.
Disclose the percentages by which the estimated fair value exceeds
the carrying
value as of the most recent impairment test for any at risk
reporting unit.
Disclose the amount of goodwill allocated to each at risk
reporting unit, including the
amount of goodwill allocated to reporting units in which material
intangible asset
impairments were recorded.
Describe the methods and key assumptions used to estimate fair
values,
including how key assumptions are determined.
Discuss the degree of uncertainty associated with key assumptions,
including
specifics to the extent possible, and disclose material changes
in key assumptions
during the periods presented and the reasons for the changes.
Discuss potential events and/or changes in circumstances that
could reasonably be
expected to negatively affect key assumptions.
Explain how you consider the difference between net book value and
market
capitalization in assessing the reasonableness of the estimated
fair values of your
reporting units.
Lee Boyce
HAIN CELESTIAL GROUP INC
March 15, 2024
Page 3
3. We note the material intangible asset impairment charges you recorded
during the year
ended June 30, 2023 and also note the significant intangible asset
balance at June 30,
2023. Please tell us and revise future filings to more fully explain
the specific facts and
circumstances, including a chronology of the events, that led to the
impairments. In
addition, given the continued significance of intangible assets, if it
is reasonably possible
that future additional impairments may materially impact your
financial statements, revise
future filings to quantify and identify brands at risk, discuss key
assumptions used to
estimate their fair value, and discuss potential events and/or changes
in circumstances that
could reasonably be expected to negatively affect key assumptions.
Consolidated Financial Statements
2. Summary of Significant Accounting Policies and Practices
Revenue Recognition, page 52
4. We note you disclose your performance obligation is fulfilled when
control passes to
customers. Please revise future filings to clarify when control passes
to customers as
required by ASC 606-10-50-12(a).
5. We note you disclose disaggregated revenue by geography in the segment
footnote. Please
explain to us your consideration of providing disaggregated revenue
disclosures for
major product lines/categories/brands and for sales channels pursuant
to ASC 606-10-55-
91(a) and (g).
19. Segment Information, page 84
6. Please revise future filings to provide the product and services
revenue disclosures
required by ASC 280-10-50-40 or explain why they are not provided. In
this regard, we
note that historically you have disclosed and discussed changes in
sales attributable to
various product lines/categories, including snacks, meat and dairy
alternatives, tea, food,
baby food, and personnel care, in MD&A.
In closing, we remind you that the company and its management are
responsible for the
accuracy and adequacy of their disclosures, notwithstanding any review,
comments, action or
absence of action by the staff.
Please contact Anne McConnell at 202-551-3709 or Martin James at
202-551-3671 with
any questions.
FirstName LastNameLee Boyce Sincerely,
Comapany NameHAIN CELESTIAL GROUP INC
Division of
Corporation Finance
March 15, 2024 Page 3 Office of
Manufacturing
FirstName LastName