The Hain Celestial Group Inc (HAIN, Financial) released its 8-K filing on August 27, 2024, reporting its financial results for the fourth quarter and fiscal year ended June 30, 2024. The company, known for its better-for-you natural and organic food and personal-care products, highlighted significant progress in its Hain Reimagined strategy, focusing on simplifying its business and driving scale.
Performance Overview
For the fourth quarter, The Hain Celestial Group Inc (HAIN, Financial) reported net sales of $419 million, a 6% decrease year-over-year. Organic net sales decreased by 4%. The gross profit margin improved to 23.4%, up 90 basis points from the prior year. The net loss for the quarter was $3 million, a significant improvement from the $19 million net loss in the same period last year. Adjusted net income was $11 million, up from $10 million in the prior year.
For the full fiscal year 2024, net sales were $1,736 million, down 3% year-over-year. Organic net sales decreased by 2%. The gross profit margin slightly decreased to 21.9%. The net loss for the year was $75 million, an improvement from the $117 million net loss in the prior year. Adjusted net income was $30 million, down from $45 million in the prior year.
Financial Achievements
The company generated strong free cash flow in fiscal 2024, enabling it to reduce net debt by $86 million over the year. The net secured leverage ratio improved to 3.7x from 4.3x at the beginning of the fiscal year. This debt reduction is crucial for the company's financial health and future growth prospects.
Income Statement Highlights
| Metric | Q4 FY24 | Q4 FY23 | FY24 | FY23 |
|---|---|---|---|---|
| Net Sales | $419M | $448M | $1,736M | $1,797M |
| Gross Profit Margin | 23.4% | 22.5% | 21.9% | 22.0% |
| Net Loss | $(3M) | $(19M) | $(75M) | $(117M) |
| Adjusted Net Income | $11M | $10M | $30M | $45M |
Balance Sheet and Cash Flow Highlights
At the end of fiscal year 2024, The Hain Celestial Group Inc (HAIN, Financial) reported total debt of $744 million, down from $829 million at the beginning of the fiscal year. Net debt was reduced to $690 million from $775 million. The company ended the fiscal year with a net secured leverage ratio of 3.7x, showing significant progress towards its leverage goal of 2x to 3x by fiscal 2027.
Segment Performance
In North America, the fiscal fourth quarter organic net sales decreased by 5% year-over-year, primarily due to lower sales in personal care and infant formula. Adjusted EBITDA for the segment was $21 million, down from $27 million in the prior year period. For the full fiscal year, North America organic net sales decreased by 6%.
Internationally, the fiscal fourth quarter organic net sales declined by 4% year-over-year, driven by lower sales in plant-based meat-free products. Adjusted EBITDA for the segment remained flat at $27 million. For the full fiscal year, international organic net sales increased by 4%, reflecting growth in soups and beverages.
Category Highlights
| Category | Q4 FY24 Net Sales | Q4 FY23 Net Sales | FY24 Net Sales | FY23 Net Sales |
|---|---|---|---|---|
| Snacks | $121M | $129M | $463M | $487M |
| Baby & Kids | $64M | $71M | $253M | $284M |
| Beverages | $56M | $54M | $253M | $239M |
| Meal Prep | $149M | $157M | $662M | $656M |
| Personal Care | $29M | $37M | $105M | $133M |
Analysis and Outlook
The Hain Celestial Group Inc (HAIN, Financial) has shown resilience in a challenging market environment, with improvements in gross profit margins and significant debt reduction. However, the decline in net sales and adjusted EBITDA indicates ongoing challenges in certain segments, particularly in North America.
Looking ahead, the company aims to focus on commercial execution to accelerate growth in fiscal 2025. The guidance for the next
Explore the complete 8-K earnings release (here) from The Hain Celestial Group Inc for further details.
