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• Organic Net Sales Decline: 5% decrease year-over-year.

• Adjusted EBITDA: $34 million, over 20% below last year's performance.

• Adjusted Gross Margin: 21.8%, a 50 basis point decrease.

• SG&A Expenses: $63 million, a 6% decrease year-over-year.

• Adjusted Net Income: $6 million or $0.07 per diluted share.

• North America Organic Net Sales Decline: 10% year-over-year.

• International Organic Net Sales Growth: 0.5% increase.

• Free Cash Flow: Outflow of $2 million compared to $30 million inflow in the prior year.

• Net Debt: $665 million with a net leverage ratio of 4.2 times.

• CapEx: $7 million, down from $12 million in the prior year period.

• Full Year Fiscal 2025 Outlook: Organic net sales down 5% to 6%, adjusted EBITDA of approximately $125 million, gross margin approximately 21.5%, and free cash flow of approximately $40 million.

• Warning! GuruFocus has detected 3 Warning Sign with HAIN.

Release Date: May 07, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• The Hain Celestial Group Inc (NASDAQ:HAIN) has improved its financial health through disciplined cash management and strategic debt reduction, resulting in a stronger balance sheet and more financial flexibility.

• The company has initiated a strategic review of its portfolio with the aim of maximizing shareholder value, retaining Goldman Sachs as its financial adviser.

• International segment has returned to year-over-year organic net sales growth, overcoming previous service level challenges.

• The company is focused on simplifying its business, reducing overhead spending, and driving operational productivity, which is expected to generate over $25 million in run rate cost savings by the second half of fiscal 2026.

• Hain Celestial is enhancing its digital capabilities to improve business execution and drive e-commerce performance, which is expected to contribute to productivity and efficiency savings.

Negative Points

• The Hain Celestial Group Inc (NASDAQ:HAIN) reported a 5% decline in organic net sales and a 23% decrease in adjusted EBITDA for the third quarter, falling short of expectations.

• The company's North American business underperformed, particularly in the snacks category, with promotional activities and trade investments not yielding expected results.

• Pricing actions did not keep pace with trade investment and cost inflation, impacting the company's financial performance.

• The leadership transition, with the departure of CEO Wendy Davidson, indicates potential instability and uncertainty in the company's strategic direction.

• The company's leverage ratio increased slightly, and despite amending its credit agreement for more flexibility, there are concerns about the rising net debt and leverage.