Headquartered in Lake Success, New York, Hain Celestial Group (HAIN, Financial), with 6,500 employees worldwide, 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', etc. It is one of the marketers, manufacturers and sellers of organic and natural, better-for-you products.
The company had a decent third-quarter net sales and earnings growth. It continued to be at the forefront of the evolution in changing consumer trends in consumer packaged goods with a strong global brand portfolio in key growth categories. It is uniquely positioned to satisfy the health and wellness needs of consumers with its leading natural and organic products. The company benefited from the diversification of business across branded organic and natural product categories, sales channels and geographies.
The company is optimistic about its growth opportunities in fiscal 2016 and beyond. It expects to build momentum throughout the year across its global footprint through the strength of the diversified product portfolio and customer base. It is investing in its brands and gaining distribution in the important health and wellness category.
Third-quarter results
Net sales during the third quarter were $750.0 million (an increase of 13% increase, from the prior-year period net sales of $662.7 million).
Hain Celestial's U.S. net sales increased by 2.7% on a constant currency basis over the prior-year period.
Earnings per diluted share were 47 cents (a 47% increase from the prior-year quarter).
Operating income during the quarter was $69.0 million, or 9.2% of net sales.
Adjusted operating income was $80.4 million, or 10.7% of net sales.
Net income during the quarter was $49.0 million (a 47% increase from the prior-year quarter).
Adjusted net income during the quarter was $50.6 million (a 9% increase from the prior-year quarter).
Strong attributes of the quarter
- Returned growth.
- Operational initiatives fueled financial performance.
- Diversification of product portfolio.
Expectations for 2016
| Ă‚ | Range |
| Net sales | To be between $2.946 billion and $2.966 billion |
| Earnings per diluted share | To range between $2.00 and $2.04 |
Innovation
The company is committed to innovation. It has introduced more than 200 new products along with new packaging and reformulations. Some of the favorites and new award-winning products include Bearitos Corn Chips, BluePrint Cranberry Apple Juice, Celestial Lattes, Earth’s Best Organic, Strawberry Banana Fruit Yogurt Smoothie, Ella’s Kitchen, Chicken Casserole, etc.
Focus
- Brand transformation initiatives.
- Cost reduction.
- Continual innovation.
- It is constantly evolving.
On Sept. 8, 2015, the company announced the appointment of Pasquale ("Pat") Conte as executive vice president and chief financial officer. Stephen J. Smith, who has served as Hain Celestial's chief financial officer, remained with the company through Sept. 30 to ensure an orderly transition. In October 2014 Conte was named senior vice president, Finance, and treasurer, having joined Hain Celestial in July 2009 after acting as a financial consultant to the company previously. In these roles, Conte has overseen the company's worldwide financial planning and analysis and worked strategically on mergers and acquisitions, quarterly reporting, taxes and Sarbanes-Oxley compliance as well as productivity and other initiatives.
On a concluding note
This is a high-growth company and is poised to grow. Existing consumer trends are in favor of this company. The company’s outlook for 2016 appears robust.
For the third year in a row it had been named to Fortune's 100 Fastest-Growing Companies in America list for 2015. Fortune cited Hain Celestial as a "packaged-food company – brands include Almond Dream, Terra and Celestial Seasonings – (that) keeps riding the trend toward products with a 'natural' aura.”
The company is well-positioned as the consumption of branded organic and natural, better-for-you products continues to rise and the distribution footprint further evolves on a global basis in both new and existing markets across broad network of sales channels.
Disclosure: I do not hold any position in the company.
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