Hain Celestial Announces Record Fourth Quarter And Fiscal Year 2015 Net Sales And Earnings Per Diluted Share

LAKE SUCCESS, N.Y., Aug. 18, 2015 /PRNewswire/ -- The Hain Celestial Group, Inc. (NASDAQ: HAIN), a leading organic and natural products company with operations in North America, Europe and India providing consumers with A Healthier Way of Life™, today reported results for its fourth quarter and fiscal year ended June 30, 2015.

PERFORMANCE HIGHLIGHTS

Fourth Quarter Fiscal Year 2015

• Record fourth quarter net sales of $698.1 million, a 20% increase over the prior year period;
• Earnings per diluted share of $0.68, a 94% increase; adjusted earnings per diluted share of $0.55, a 22% increase;
• Operating income of $74.7 million, 11% of net sales; adjusted operating income of $90.3 million, 13% of net sales.

Fiscal Year 2015

• Record net sales of $2.69 billion, a 25% increase; adjusted net sales of $2.71 billion, adjusted for the nut butter voluntary recall in August 2014, a 26% increase over the prior year period;
• Earnings per diluted share of $1.62, a 16% increase; adjusted earnings per diluted share of $1.88, an 18% increase;
• Operating income of $237.7 million, 9% of net sales; adjusted operating income of $314.1 million, 12% of net sales.

"We ended the year with record net sales and earnings growth fueled by strong worldwide demand for our diverse portfolio of leading organic and natural brands across many product categories, sales channels and geographies," said Irwin D. Simon, Founder, President and Chief Executive Officer of Hain Celestial.  "We achieved these results while overcoming numerous challenges during the year including the largest voluntary recall in the Company's history, a fire that limited production for one of our largest brands and disruptions with some of our distributor and retail customers.  Our global team did a tremendous job in both the fourth quarter and fiscal year with product innovation, controlling expenses, improving productivity and successfully integrating acquisitions by leveraging our infrastructure."

Fourth Quarter 2015

Hain Celestial US reported record fourth quarter net sales of $332.8 million.  In the United Kingdom, net sales were $184.9 million, and the Rest of the World segment reported net sales of $62.0 million, which also includes the recently acquired Belvedere International, Inc. in Canada with its Live Clean® brand.  The Hain Pure Protein segment (HPPC) reported net sales of $118.5 million, which includes the recently acquired Empire® brand of kosher foods.  The Company had strong brand sales in constant currency led by certain global brands including Terra®, Tilda®, Imagine®, Earth's Best®, Avalon Organics® and Alba Botanica® with strong performance from Frank Cooper's®, Bearitos®, Rosetto®, Danival®, Lima®, Sensible Portions®, Hain Pure Foods® and Spectrum®.  Net sales of Rudi's Organic Bakery®, Plainville Farms®, FreeBird®, Empire®, Kosher Valley® and Live Clean® brands acquired during or after the fourth quarter of fiscal year 2014 also contributed to the growth.

The Company earned net income from continuing operations of $71.1 million, a 99% increase, and adjusted net income of $57.2 million, a 24% increase, compared to the prior year fourth quarter.  Earnings per diluted share for the fourth quarter were $0.68, a 94% increase versus the prior year period, which includes a $20.7 million tax benefit resulting from an election made during the quarter to change the tax status of one of the Company's international subsidiaries.  On an adjusted basis earnings per diluted share for the fourth quarter were $0.55, a 22% increase.  Refer to Non-GAAP Financial Measures in this press release for adjustments.

Fiscal Year 2015

Hain Celestial US reported record net sales of $1.367 billion.  In the United Kingdom, net sales were $736.0 million, and the Rest of World segment reported net sales of $226.5 million.  Rest of World includes the recently acquired Live Clean® brand.  HPPC, which includes the recently acquired Empire® brand of kosher foods, reported net sales of $358.6 million.  The Company had strong brand sales in constant currency led by global brands including Sensible Portions®, Natumi®, Terra®, Danival®, Garden of Eatin'®, Earth's Best®, Avalon Organics®, Alba Botanica® and Jason® with strong performance from Bearitos®, Westbrae® Earth's Best® and Frank Cooper's®.  Net sales of Plainville Farms®, FreeBird®, Empire®, Kosher Valley® and Live Clean® brands acquired after fiscal year 2014 also contributed to the growth.

The Company earned net income from continuing operations of $167.9 million, a 19% increase, and adjusted net income of $193.9 million, a 22% increase, for the fiscal year.  Earnings per diluted share for the fiscal year were $1.62, a 16% increase, and on an adjusted basis were $1.88, an 18% increase.  Refer to Non-GAAP Financial Measures in this press release for adjustments.   

Fiscal Year 2015 Achievements

The Company highlighted several of its accomplishments during fiscal year 2015:

• Completed three strategic acquisitions:
  • Hain Pure Protein Corporation (Plainville Farms® and FreeBird® brands);
  • EK Holdings, Inc. (Empire® Kosher and Kosher Valley® brands);
  • Belvedere International, Inc. (Live Clean® brand);
• Worldwide sales reached a record $2.7 billion;
• Achieved record adjusted EBITDA of $375 million;
• Hain Celestial US consumption measured by Nielsen of top 200 SKUs was up 11% with distribution up 5%;
• Introduced over 200 new innovative products worldwide;
• Delivered in excess of $55 million in worldwide productivity savings.

"Our outlook for growth in fiscal 2016 and beyond remains robust. We believe Hain Celestial is well-positioned as the consumption of branded organic and natural products continues to rise and our distribution footprint further evolves on a global basis in both new and existing markets across our broad network of sales channels," concluded Irwin Simon.

Fiscal Year 2016 Guidance

The Company provided annual guidance for fiscal year 2016: 

• Total net sales range of $2.97 billion to $3.11 billion, an increase of approximately 10% to 15% as compared to fiscal year 2015;
• Earnings range of $2.11 to $2.26 per diluted share, an increase of 12% to 20% as compared to fiscal year 2015.

Guidance is provided for continuing operations on a non-GAAP basis and excludes acquisition-related expenses, integration and restructuring charges, start-up costs, unrealized net foreign currency gains or losses, reserves for litigation matters and other non-recurring items, including any product recalls or market withdrawals, that have been or may be incurred during the Company's fiscal year 2016, which the Company will continue to identify as it reports its future financial results.  Guidance excludes the impact of any future acquisitions.  

Segment Results

The Company's operations are managed into the following segments:  United States, United Kingdom, HPPC and Rest of World (comprised of Canada and Continental Europe). 

The following is a summary of three months and twelve months results by reportable segment:

Webcast

Hain Celestial will host a conference call and webcast at 8:30 AM Eastern Time today to review its fourth quarter and fiscal year 2015 results.  The conference call will be webcast and available under the Investor Relations section of the Company's website at www.hain.com.

The Hain Celestial Group, Inc.

The Hain Celestial Group (NASDAQ: HAIN), headquartered in Lake Success, NY, is a leading organic and natural products company with operations in North America, Europe and India.  Hain Celestial participates in many natural categories with well-known brands that include Celestial Seasonings®, Earth's Best®, Ella's Kitchen®, Terra®, Garden of Eatin'®, Sensible Portions®, Health Valley®, Arrowhead Mills®, MaraNatha®, SunSpire®, DeBoles®, Casbah®, Rudi's Organic Bakery®, Gluten Free Café™, Hain Pure Foods®, Spectrum®, Spectrum Essentials®, Walnut Acres Organic®, Imagine®, Almond Dream®, Rice Dream®, Soy Dream®, WestSoy®, The Greek Gods®, BluePrint®, FreeBird®, Plainville Farms®, Empire®, Kosher Valley®, Yves Veggie Cuisine®, Europe's Best®, Cully & Sully®, New Covent Garden Soup Co.®, Johnson's Juice Co.®, Farmhouse Fare®, Hartley's®, Sun-Pat®, Gale's®, Robertson's®, Frank Cooper's®, Linda McCartney®, Lima®, Danival®, Joya®, Natumi®, GG UniqueFiber®, Tilda®, JASON®, Avalon Organics®, Alba Botanica®, Live Clean® and Queen Helene®.  Hain Celestial has been providing A Healthier Way of Life™ since 1993.  For more information, visit www.hain.com.

Safe Harbor Statement

Certain statements contained in this press release constitute "forward-looking statements" under the Private Securities Litigation Reform Act of 1995.  Words such as "plan," "continue," "expect," "expected," "anticipate," "intend", "estimate," "believe," "seek", "may," "potential," "can," "positioned," "should," "future," "look forward", "outlook", and similar expressions, or the negative of those expressions, may identify forward-looking statements.  These forward-looking statements include the Company's beliefs or expectations relating to (i) the Company's guidance for net sales and earnings per diluted share for fiscal year 2016 and (ii) growth trends and distribution opportunities.  Such forward-looking statements involve known and unknown risks, uncertainties, and other factors which may cause the Company's actual results, levels of activity, performance or achievements of the Company, or industry results, to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements.  Such factors include, among others, the Company's ability to achieve its guidance for net sales and earnings per diluted share in fiscal year 2016 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; 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; the ability of the Company's joint venture investment to successfully execute its business plan; the Company's ability to realize sustainable growth generally and from investments 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; the Company's ability to successfully consummate its proposed divestitures; the effects on the Company's results of operations from the impacts of foreign exchange; competition; the success and cost of introducing new products as well as the Company's ability to increase prices on existing products; availability and retention of key personnel; 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; risks associated with international sales and operations; changes in fuel, raw material and commodity costs; changes in, or the failure to comply with, government laws and regulations; the availability of organic and natural ingredients; the loss of one or more of the Company's manufacturing facilities; independent co-packers or distribution centers; the ability to manage the Company's supply chain effectively; the ability to use the Company's trademarks; reputational damage; product liability; outbreaks of diseases or food-borne illnesses; product recall or market withdrawal; seasonality; litigation; the Company's reliance on its information technology systems; and the 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, 2014.  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.

Non-GAAP Financial Measures

This press release and the accompanying tables include non-GAAP financial measures, including adjusted operating income, adjusted income from continuing operations, adjusted income per diluted share from continuing operations, adjusted EBITDA (defined below) 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 and twelve months ended June 30, 2015 and 2014 and in the paragraphs below.  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. 

The Company defines adjusted 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, stock based compensation, acquisition-related expenses, including integration and restructuring charges, and other non-recurring items.  The Company's management believes that this presentation provides 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 this measure for reviewing the financial results of the Company and as a component of performance-based executive compensation. 

For the three and twelve months ended June 30, 2015 and 2014, adjusted EBITDA was calculated as follows:

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 fiscal years ended June 30, 2015 and 2014, operating free cash flow was calculated as follows:

Operating free cash flow for the fiscal year ended June 30, 2015 was $134.3 million, compared to $143.2 million in the prior year period.  Our current period operating free cash flow was impacted primarily by the effects of the nut butter voluntary recall and higher capital expenditures.

 

 

 

 

 

 

 

 

 

 

 

Logo - http://photos.prnewswire.com/prnh/20130502/NY06743LOGO

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/hain-celestial-announces-record-fourth-quarter-and-fiscal-year-2015-net-sales-and-earnings-per-diluted-share-300129770.html

SOURCE The Hain Celestial Group, Inc.