Hain Celestial Group (Nasdaq: HAIN) (“Hain”, “Hain Celestial” or
the “Company”), a leading manufacturer of better-for-you brands to
inspire healthier living, today unveils its Hain Reimagined
strategy to accelerate the Company’s profitable growth path at its
2023 Investor Day event in New York.
Wendy Davidson, President and Chief Executive
Officer, stated, “Following a comprehensive review of our business,
I am excited to unveil our Hain Reimagined strategy. Hain
Reimagined is a multi-year transformation plan designed to drive
long-term sustainable growth and attractive shareholder returns.
Fiscal 2024 marks the foundational year of our plan, during which
we will simplify the business, reset our global operating model,
initiate our Fuel Program, invest to jumpstart critical
capabilities, and begin our pivot to growth. By fiscal 2027, we
expect to deliver sustained revenue and profit growth with a
reimagined end-to-end supply chain, modern digital infrastructure,
and performance driven culture that will enable our brands to
expand reach and grow share. I look forward to executing our
strategy to realize our full potential and deliver on our purpose
to inspire healthier living for people, communities, and the planet
through better-for-you brands.”
HAIN REIMAGINED
Hain Reimagined is grounded in executing on four
strategic pillars to drive shareholder return:
-
Focus
- We have a
winning portfolio organized around 5 consumer-centric global BFY
platforms – BFY Snacks, BFY Baby & Kids, BFY Beverages, BFY
Meal Prep, and BFY Personal Care – with clearly defined roles for
each.
- We will focus
and materially simplify our footprint, maintaining direct presence
in 5 key markets – United States, Canada, UK, Ireland, and Europe –
and will align our global operating model and footprint, leveraging
scale and realizing synergies between our businesses.
-
Grow
- Growth will be
predominately driven by three key platforms where we have the most
compelling right to win – BFY Snacks, BFY Baby & Kids, and BFY
Beverages.
- Our growth plan
is designed to deliver share gain in key platforms through expanded
channel reach and acceleration in our innovation pipeline.
-
Build
- We will
facilitate growth by enhancing a set of critical capabilities
around brand building, channel expansion, and innovation.
- We will elevate
our approach to brand building and improve the effectiveness of our
marketing spend; expand reach across under-penetrated
margin-accretive channels such as away from home and omni-channel
e-commerce; and enhance our innovation capability to be more
leading edge in BFY.
-
Fuel
- Our Fuel Program
consists of three main levers: revenue growth management, working
capital management, and operational efficiency.
- We expect our
Fuel Program to achieve ~400-500 basis points of adjusted gross
margin improvement and contribute to the delivery of $400 million
in cumulative free cash flow by FY27.
FINANCIAL ALGORITHM
We expect our Hain Reimagined strategy to
deliver an achievable and compelling multi-year financial algorithm
through FY27 with attractive shareholder returns, representing a
material transformation of our financial profile.
Our long-term outlook is as follows:
- Organic net sales CAGR of 3%+
- Adjusted EBITDA CAGR of 10%+
- Adjusted EBITDA margin of 12%+ by
FY27
- Net debt leverage ratio of 2-3x by
FY27
We will fund and pace investments to be profit
accretive over the period.
RESTRUCTURING PROGRAM
In connection with the Hain Reimagined strategy,
the Company announced a formal restructuring program intended to
expand operating margins through the optimization of the Company’s
brand portfolio, organization, end-to-end supply chain, and working
capital.
The restructuring program is targeting $130
million to $150 million of annualized savings and a $165 million
conversion of working capital cash by FY27. One-time
restructuring and related costs are estimated to be in the range of
$115 million to $125 million across fiscal 2024 and fiscal 2025.
Savings from the restructuring program will be used to help fund
the Company’s transformation.
WEBCAST INFORMATION
The Hain Celestial 2023 Investor Day
presentation will be webcast today beginning at 8:30 AM Eastern
Time. The live webcast and accompanying slides will be available
under the Investors section of the Company’s corporate website at
www.hain.com. A replay will be available following the conclusion
of the event and for at least 6 months thereafter.
About The Hain Celestial
GroupHain Celestial Group is a global health and wellness
company whose purpose is to inspire healthier living for people,
communities, and the planet through better-for-you brands. For more
than 30 years, our portfolio of beloved brands has intentionally
focused on delivering nutrition and well-being that positively
impacts today and tomorrow. Headquartered in Hoboken, N.J., Hain
Celestial’s products across snacks, baby/kids, beverages, meal
preparation, and personal care, are marketed and sold in over 75
countries around the world. Our leading brands include Garden
Veggie™ Snacks, Terra chips®, Garden of Eatin’® snacks,
Earth’s Best® and Ella’s Kitchen® baby and toddler foods, Celestial
Seasonings® teas, Joya® and Natumi® plant-based beverages, Greek
Gods® yogurt, Yorkshire Provender®, Cully & Sully® and Covent
Garden® soups, Yves® and Linda McCartney’s® (under license)
meat-free, Alba Botanica® natural sun care, and Live Clean®
personal care products, among others. For more information, visit
hain.com and LinkedIn.
Forward-Looking StatementsThis
press release contains forward-looking statements within the
meaning of the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Such statements involve risks,
uncertainties and assumptions. If the risks or uncertainties ever
materialize or the assumptions prove incorrect, our results may
differ materially from those expressed or implied by such
forward-looking statements. The words “believe,” “expect,”
“anticipate,” “may,” “should,” “plan,” “intend,” “potential,”
“will” and similar expressions are intended to identify such
forward-looking statements. Forward-looking statements include,
among other things, our beliefs or expectations relating to our
future performance, results of operations and financial condition;
our strategic initiatives; our business strategy; our supply chain,
including the availability and pricing of raw materials; our brand
portfolio, pricing actions and product performance; foreign
exchange and inflation rates; current or future macroeconomic
trends; and future corporate acquisitions or dispositions.
Risks and uncertainties that may cause actual
results to differ materially from forward-looking statements
include: challenges and uncertainty resulting from the impact of
competition; our ability to manage our supply chain effectively;
input cost inflation, including with respect to freight and other
distribution costs; disruption of operations at our manufacturing
facilities; reliance on independent contract manufacturers; changes
to consumer preferences; customer concentration; reliance on
independent distributors; risks associated with operating
internationally; pending and future litigation, including
litigation relating to Earth’s Best® baby food products; the
reputation of our Company and our brands; compliance with our
credit agreement; foreign currency exchange risk; the availability
of organic ingredients; risks associated with outsourcing
arrangements; our ability to execute our cost reduction initiatives
and related strategic initiatives; risks arising from the
Russia-Ukraine war; our ability to identify and complete
acquisitions or divestitures and our level of success in
integrating acquisitions; our reliance on independent certification
for a number of our products; our ability to use and protect
trademarks; general economic conditions; cybersecurity incidents;
disruptions to information technology systems; changing rules,
public disclosure regulations and stakeholder expectations on
ESG-related matters; the impact of climate change; liabilities,
claims or regulatory change with respect to environmental matters;
potential liability if our products cause illness or physical harm;
the highly regulated environment in which we operate; compliance
with data privacy laws; our ability to issue preferred stock; the
adequacy of our insurance coverage; impairments in the carrying
value of goodwill or other intangible assets; and other risks and
matters described in our most recent Annual Report on Form 10-K and
our other filings from time to time with the U.S. Securities and
Exchange Commission.
We undertake no obligation to update
forward-looking statements to reflect actual results or changes in
assumptions or circumstances, except as required by applicable
law.
Non-GAAP Financial MeasuresThis
press release includes forward-looking non-GAAP financial measures,
including organic net sales, adjusted EBITDA and adjusted EBITDA
margin. The Company defines organic net sales as net sales
excluding the impact of acquisitions, divestitures and discontinued
brands. The Company defines adjusted EBITDA as net (loss) income
before net interest expense, income taxes, depreciation and
amortization, equity in net (gain) loss of equity-method investees,
stock-based compensation, net, unrealized currency losses (gains),
certain litigation and related costs, CEO succession costs, plant
closure related costs, net, productivity and transformation costs,
warehouse and manufacturing consolidation and other costs, costs
associated with acquisitions, divestitures and other transactions,
gains on sales of assets, certain inventory write-downs,
intangibles and long-lived asset impairments and other
adjustments.
Management believes that the non-GAAP financial
measures presented provide useful information to investors about
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.
The forward-looking non-GAAP financial measures
included in this press release, such as the Company’s projections,
expectations or outlook for organic net sales, adjusted EBITDA and
adjusted EBITDA margin, are not reconciled to the comparable
forward-looking GAAP financial measures. We are not able to
reconcile these forward-looking non-GAAP financial measures to
their most directly comparable forward-looking GAAP financial
measures without unreasonable efforts because we are unable to
predict with a reasonable degree of certainty the type and extent
of certain items that would be expected to impact GAAP measures but
would not impact the non-GAAP measures. With respect to organic net
sales, such items may include the impact of unknown future
acquisitions, divestitures and discontinued brands. With respect to
adjusted EBITDA and adjusted EBITDA margin, such items may include
certain litigation and related expenses, transaction costs
associated with acquisitions and divestitures, productivity and
transformation costs, impairments, gains or losses on sales of
assets and businesses, foreign exchange movements and other items.
The unavailable information could have a significant impact on our
GAAP financial results.
Contacts
Investor Relations:Alexis TessierInvestor.Relations@hain.com
Media:Jen DavisJen.Davis@hain.com
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