Hain Celestial Announces Record Results for Second Quarter Fiscal Year 2013 and Raises Earnings Guidance
(Logo: http://photos.prnewswire.com/prnh/20050324/NYTH131 )
Performance Highlights 2QFY13 Compared to 2QFY12
- Record net sales of
$455.3 million , an increase of 24.8% - GAAP net income of
$31.6 million , an increase of 57.8% - GAAP earnings per diluted share from continuing operations of
$0.68 , an increase of 47.8% - Adjusted earnings per diluted share of
$0.72 , an increase of 35.8% - Operating free cash flow of
$106.8 million for the trailing 12 months endedDecember 31, 2012 , an increase of 47.6% - Adjusted EBITDA of
$205.9 million for the trailing 12 months endedDecember 31, 2012 , an increase of 31.8%
"I am extremely pleased with our results as Hain Celestial US delivered 9.4% top-line growth on a comparable basis as well as increased profitability during the second quarter. In the
Worldwide net sales for the second quarter of fiscal year 2013 were a record
The Company earned income from continuing operations of
Fiscal Year 2013 Guidance
The Company updated its annual guidance for fiscal year 2013.
- Total net sales range of
$1.740 billion to $1.755 billion ; an increase of 26% to 27% as compared to fiscal year 2012. - Earnings range of
$2.40 to $2.47 per diluted share; an increase of 29% to 33% as compared to fiscal year 2012.
Guidance is provided for continuing operations on a non-GAAP basis and excludes acquisition and integration expenses that may be incurred during the Company's fiscal year 2013, which the Company will continue to identify as it reports its future financial results. Guidance excludes the impact of any future acquisitions. Historically, the Company's sales and earnings are strongest in its second and third quarters.
Segment Results
The Company's operations are organized into geographic segments:
Sales in
The following is a summary of second quarter and six month results by reportable segment:
The Hain Celestial Group, Inc. |
||||||||||
Reportable Segment Results |
||||||||||
(dollars in thousands) |
||||||||||
United States |
United Kingdom |
Rest of World |
Corporate/Other |
Consolidated |
||||||
Net sales - Three months ended 12/31/12 |
$ 280,415 |
$ 120,167 |
$ 54,737 |
$ 455,319 |
||||||
Net sales - Three months ended 12/31/11 |
$ 259,153 |
$ 56,417 |
$ 49,267 |
$ 364,837 |
||||||
% change |
8.20% |
113.00% |
11.10% |
24.80% |
||||||
Operating income - Three months ended 12/31/12 |
$ 47,582 |
$ 12,076 |
$ 4,268 |
$ (12,682) |
$ 51,244 |
|||||
Operating income - Three months ended 12/31/11 |
$ 41,760 |
$ 3,362 |
$ 2,630 |
$ (11,548) |
$ 36,204 |
|||||
% change |
13.90% |
259.20% |
62.30% |
41.50% |
||||||
Operating income margin - Three months ended 12/31/12 |
17.00% |
10.00% |
7.80% |
11.30% |
||||||
Operating income margin - Three months ended 12/31/11 |
16.10% |
6.00% |
5.30% |
9.90% |
||||||
United States |
United Kingdom |
Rest of World |
Corporate/Other |
Consolidated |
||||||
Net sales - six months ended 12/31/12 |
$ 533,062 |
$ 178,115 |
$ 103,949 |
$ 815,126 |
||||||
Net sales - six months ended 12/31/11 |
$ 492,795 |
$ 67,655 |
$ 91,224 |
$ 651,674 |
||||||
% change |
8.20% |
163.30% |
13.90% |
25.10% |
||||||
Operating income - six months ended 12/31/12 |
$ 84,099 |
$ 11,050 |
$ 8,674 |
$ (20,303) |
$ 83,520 |
|||||
Operating income - six months ended 12/31/11 |
$ 73,492 |
$ 2,240 |
$ 4,810 |
$ (20,501) |
$ 60,041 |
|||||
% change |
14.40% |
393.30% |
80.30% |
39.10% |
||||||
Operating income margin - six months ended 12/31/12 |
15.80% |
6.20% |
8.30% |
10.20% |
||||||
Operating income margin - six months ended 12/31/11 |
14.90% |
3.30% |
5.30% |
9.20% |
Webcast
The
The
Safe Harbor Statement
This press release contains forward-looking statements under the Private Securities Litigation Reform Act of 1995. 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. These forward-looking statements include the Company's expectations relating to (i) the Company's guidance for net sales and earnings per diluted share for fiscal year 2013; and (ii) the Company's investment in its Fakenham facility for the commencement later this year of a program with a major retailer. 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 risks include but are not limited to the Company's ability to achieve its guidance for net sales and earnings per diluted share for fiscal year 2013 given the economic environment in the U.S. and other markets that it sells 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 ability to implement its business and acquisition strategy; the Company's ability to realize sustainable growth, execute productivity initiatives and manage its supply chain; 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 Company's reliance on third party distributors, manufacturers and suppliers; the Company's ability to maintain existing customers 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, raw materials and commodity costs; changes in, or the failure to comply with, government regulations; the availability of natural and organic ingredients; the loss of one or more of our manufacturing facilities; our ability to use our trademarks; reputational damage; product liability; seasonality; and those risks detailed from time-to-time in the Company's reports filed with the
Non-GAAP Financial Measures
This press release and the accompanying tables include non-GAAP financial measures, including adjusted net income, adjusted gross profit, adjusted diluted EPS, earnings before interest, taxes, depreciation, and amortization ("EBITDA"), adjusted EBITDA and operating free cash flow. The reconciliations of these non-GAAP financial measures to the comparable GAAP financial measures are presented in the tables "Reconciliation of GAAP Results to Non-GAAP Measures" for the three months and six months ended
The Company defines EBITDA as net income (a GAAP measure) before income taxes, net interest expense, depreciation and amortization, impairment of long lived assets, equity in the earnings of non-consolidated affiliates and stock based compensation. Adjusted EBITDA is defined as net income before income taxes, net interest expense, depreciation and amortization, impairment of long lived assets, equity in the earnings of non-consolidated affiliates, stock based compensation and acquisition-related expenses, including integration and restructuring charges. The Company's management believes that these presentations provide useful information to management, analysts and investors regarding certain additional financial and business trends relating to its results of operations and financial condition. In addition, management uses these measures for reviewing the financial results of the Company as well as a component of performance-based executive compensation.
For the three-month, six-month and trailing 12-month periods ended
3-Months Ended |
6-Months Ended |
Trailing 12 Months |
|||||
12/31/12 |
12/31/11 |
12/31/12 |
12/31/11 |
12/31/12 |
12/31/11 |
||
Net Income |
$31,622 |
$20,038 |
$48,008 |
$31,728 |
$95,505 |
$61,348 |
|
Income taxes |
16,106 |
11,028 |
24,442 |
18,745 |
45,040 |
38,528 |
|
Interest expense, net |
4,673 |
4,019 |
8,114 |
6,918 |
16,271 |
13,411 |
|
Depreciation and amortization |
8,984 |
8,278 |
16,993 |
14,592 |
32,861 |
27,003 |
|
Impairment of long lived assets |
- |
- |
- |
- |
15,098 |
- |
|
Equity in earnings of affiliates |
(596) |
(751) |
142 |
(819) |
(179) |
1,945 |
|
Stock based compensation |
3,709 |
1,969 |
6,601 |
3,763 |
11,129 |
8,883 |
|
EBITDA |
64,498 |
44,581 |
104,300 |
74,927 |
215,725 |
151,118 |
|
Acquisition related expenses |
|||||||
and restructuring charges |
3,775 |
5,205 |
4,416 |
6,952 |
(9,817) |
5,149 |
|
Adjusted EBITDA |
$68,273 |
$49,786 |
$108,716 |
$81,879 |
$205,908 |
$156,267 |
The Company defines Operating Free Cash Flow as cash provided from or used in operating activities (a GAAP measure) less capital expenditures. The Company views 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 trailing 12-month periods ended
12-Months Ended 12/31/2012 |
12-Months Ended 12/31/2011 |
||
Cash flow provided by operating activities |
$145,229 |
$85,921 |
|
Purchases of property, plant and equipment |
(38,479) |
(13,578) |
|
Operating free cash flow |
$106,750 |
$72,343 |
THE HAIN CELESTIAL GROUP, INC. |
|||||
Consolidated Balance Sheets |
|||||
(In thousands) |
|||||
December 31, |
June 30, |
||||
2012 |
2012 |
||||
(Unaudited) |
|||||
ASSETS |
|||||
Current assets: |
|||||
Cash and cash equivalents |
$ 42,571 |
$ 29,895 |
|||
Trade receivables, net |
217,429 |
166,677 |
|||
Inventories |
234,278 |
186,440 |
|||
Deferred income taxes |
17,180 |
15,834 |
|||
Other current assets |
26,411 |
19,864 |
|||
Assets of business held for sale |
- |
30,098 |
|||
Total current assets |
537,869 |
448,808 |
|||
Property, plant and equipment, net |
218,170 |
148,475 |
|||
Goodwill, net |
893,921 |
702,556 |
|||
Trademarks and other intangible assets, net |
424,356 |
310,378 |
|||
Investments and joint ventures |
49,595 |
45,100 |
|||
Other assets |
25,357 |
18,276 |
|||
Total assets |
$ 2,149,268 |
$ 1,673,593 |
|||
LIABILITIES AND STOCKHOLDERS' EQUITY |
|||||
Current liabilities: |
|||||
Accounts payable and accrued expenses |
$ 243,020 |
$ 184,103 |
|||
Income taxes payable |
10,047 |
5,074 |
|||
Current portion of long-term debt |
5,393 |
296 |
|||
Liabilities of business held for sale |
- |
13,336 |
|||
Total current liabilities |
258,460 |
202,809 |
|||
Deferred income taxes |
135,395 |
107,633 |
|||
Other noncurrent liabilities |
14,838 |
8,261 |
|||
Long-term debt, less current portion |
635,110 |
390,288 |
|||
Total liabilities |
1,043,803 |
708,991 |
|||
Stockholders' equity: |
|||||
Common stock |
478 |
462 |
|||
Additional paid-in capital |
699,804 |
616,197 |
|||
Retained earnings |
423,119 |
375,111 |
|||
Treasury stock |
(30,194) |
(21,785) |
|||
Accumulated other comprehensive income |
12,258 |
(5,383) |
|||
Total stockholders' equity |
1,105,465 |
964,602 |
|||
Total liabilities and stockholders' equity |
$ 2,149,268 |
$ 1,673,593 |
THE HAIN CELESTIAL GROUP, INC. |
||||||||
Consolidated Statements of Income |
||||||||
(in thousands, except per share amounts) |
||||||||
Three Months Ended December 31, |
Six Months Ended December 31, |
|||||||
2012 |
2011 |
2012 |
2011 |
|||||
(Unaudited) |
(Unaudited) |
|||||||
Net sales |
$ 455,319 |
$ 364,837 |
$ 815,126 |
$ 651,674 |
||||
Cost of sales |
324,556 |
260,252 |
589,151 |
467,285 |
||||
Gross profit |
130,763 |
104,585 |
225,975 |
184,389 |
||||
Selling, general and administrative expenses |
75,744 |
63,460 |
138,039 |
117,896 |
||||
Acquisition related expenses including integration and restructuring charges |
3,775 |
4,921 |
4,416 |
6,452 |
||||
Operating income |
51,244 |
36,204 |
83,520 |
60,041 |
||||
Interest expense and other expenses |
3,295 |
4,607 |
7,187 |
8,156 |
||||
Income before income taxes and equity in earnings of equity- method investees |
47,949 |
31,597 |
76,333 |
51,885 |
||||
Income tax provision |
16,302 |
11,267 |
24,160 |
18,984 |
||||
After-tax (income) loss of equity-method investees |
(596) |
(751) |
142 |
(819) |
||||
Income from continuing operations |
32,243 |
21,081 |
52,031 |
33,720 |
||||
Loss from discontinued operations, net of tax |
(621) |
(1,043) |
(4,023) |
(1,992) |
||||
Net income |
$ 31,622 |
$ 20,038 |
$ 48,008 |
$ 31,728 |
||||
Basic net income per share: |
||||||||
From continuing operations |
$ 0.70 |
$ 0.48 |
$ 1.14 |
$ 0.77 |
||||
From discontinued operations |
(0.01) |
(0.03) |
(0.08) |
(0.05) |
||||
Net income per share - basic |
$ 0.69 |
$ 0.45 |
$ 1.06 |
$ 0.72 |
||||
Diluted net income per share: |
||||||||
From continuing operations |
$ 0.68 |
$ 0.46 |
$ 1.11 |
$ 0.74 |
||||
From discontinued operations |
(0.01) |
(0.02) |
(0.09) |
(0.04) |
||||
Net income per share - diluted |
$ 0.67 |
$ 0.44 |
$ 1.02 |
$ 0.70 |
||||
Weighted average common shares outstanding: |
||||||||
Basic |
45,942 |
44,158 |
45,480 |
44,044 |
||||
Diluted |
47,355 |
45,652 |
46,962 |
45,504 |
THE HAIN CELESTIAL GROUP, INC. |
||||||
Reconciliation of GAAP Results to Non-GAAP Measures |
||||||
(in thousands, except per share amounts) |
||||||
Three Months Ended December 31, |
||||||
2012 GAAP |
Adjustments |
2012 Adjusted |
2011 Adjusted |
|||
(Unaudited) |
||||||
Gross profit |
$ 130,763 |
- |
$ 130,763 |
$ 104,585 |
||
Selling, general and administrative expenses |
75,744 |
- |
75,744 |
63,460 |
||
Acquisition related (income) expenses including integration and restructuring charges |
3,775 |
(3,775) |
- |
- |
||
Operating income |
51,244 |
3,775 |
55,019 |
41,125 |
||
Interest and other expenses, net |
3,295 |
1,324 |
4,619 |
4,276 |
||
Income before income taxes and equity in earnings of equity- method investees |
47,949 |
2,451 |
50,400 |
36,849 |
||
Income tax provision |
16,302 |
486 |
16,788 |
13,146 |
||
After-tax (income) loss of equity-method investees |
(596) |
- |
(596) |
(674) |
||
Income from continuing operations |
$ 32,243 |
$ 1,965 |
$ 34,208 |
$ 24,377 |
||
Income per share from continuing operations - basic |
$ 0.70 |
$ 0.04 |
$ 0.74 |
$ 0.55 |
||
Income per share from continuing operations - diluted |
$ 0.68 |
$ 0.04 |
$ 0.72 |
$ 0.53 |
||
Weighted average common shares outstanding: |
||||||
Basic |
45,942 |
45,942 |
44,158 |
|||
Diluted |
47,355 |
47,355 |
45,652 |
|||
FY 2013 |
FY 2012 |
|||||
Impact on Income Before Income Taxes |
Impact on Income Tax Provision |
Impact on Income Before Income Taxes |
Impact on Income Tax Provision |
|||
(Unaudited) |
||||||
Acquisition related fees and expenses, integration and restructuring charges |
$ 3,775 |
$ 1,017 |
4,921 |
$ 1,805 |
||
Acquisition related (income) expenses including integration and restructuring charges |
3,775 |
1,017 |
4,921 |
1,805 |
||
Currency gain on acquisition payment |
(1,324) |
(531) |
331 |
74 |
||
Interest and other expenses, net |
(1,324) |
(531) |
331 |
74 |
||
Net (income) loss from HPP discontinued operation |
- |
- |
(77) |
- |
||
After-tax (income) loss of equity-method investees |
- |
- |
(77) |
- |
||
Total adjustments |
$ 2,451 |
$ 486 |
$ 5,175 |
$ 1,879 |
THE HAIN CELESTIAL GROUP, INC. |
||||||
Reconciliation of GAAP Results to Non-GAAP Measures |
||||||
(in thousands, except per share amounts) |
||||||
Six Months Ended December 31, |
||||||
2012 GAAP |
Adjustments |
2012 Adjusted |
2011 Adjusted |
|||
(Unaudited) |
||||||
Gross profit |
$ 225,975 |
- |
$ 225,975 |
184,389 |
||
Selling, general and administrative expenses |
138,039 |
- |
138,039 |
117,896 |
||
Acquisition related (income) expenses including integration and restructuring charges |
4,416 |
(4,416) |
- |
- |
||
Operating income |
83,520 |
4,416 |
87,936 |
66,493 |
||
Interest and other expenses, net |
7,187 |
1,254 |
8,441 |
7,696 |
||
Income before income taxes and equity in earnings of equity- method investees |
76,333 |
3,162 |
79,495 |
58,797 |
||
Income tax provision |
24,160 |
2,405 |
26,565 |
21,478 |
||
After-tax (income) loss of equity-method investees |
142 |
- |
142 |
(742) |
||
Income from continuing operations |
$ 52,031 |
$ 757 |
$ 52,788 |
$ 38,061 |
||
Income per share from continuing operations - basic |
$ 1.14 |
$ 0.02 |
$ 1.16 |
$ 0.86 |
||
Income per share from continuing operations - diluted |
$ 1.11 |
$ 0.02 |
$ 1.12 |
$ 0.84 |
||
Weighted average common shares outstanding: |
||||||
Basic |
45,480 |
45,480 |
44,044 |
|||
Diluted |
46,962 |
46,962 |
45,504 |
|||
FY 2013 |
FY 2012 |
|||||
Impact on Income Before Income Taxes |
Impact on Income Tax Provision |
Impact on Income Before Income Taxes |
Impact on Income Tax Provision |
|||
(Unaudited) |
||||||
Acquisition related fees and expenses, integration and restructuring charges |
$ 4,416 |
$ 1,126 |
$ 6,452 |
$ 2,379 |
||
Acquisition related (income) expenses including integration and restructuring charges |
4,416 |
1,126 |
6,452 |
2,379 |
||
Currency gain on acquisition payment |
(1,254) |
(514) |
460 |
115 |
||
Interest and other expenses, net |
(1,254) |
(514) |
460 |
115 |
||
Net (income) loss from HPP discontinued operation |
- |
- |
(77) |
- |
||
After-tax (income) loss of equity-method investees |
- |
- |
(77) |
- |
||
Decrease in unrecognized tax benefits |
- |
1,793 |
||||
Income tax provision |
- |
1,793 |
- |
- |
||
Total adjustments |
$ 3,162 |
$ 2,405 |
$ 6,835 |
$ 2,494 |
SOURCE The
Ira Lamel/Mary Anthes, The Hain Celestial Group, Inc., +1-631-730-2200