In This Article:
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Net Sales: Reported flat year-over-year at $454.1 million.
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Organic Net Sales: Slight increase of 0.2% year-over-year.
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Gross Profit Margin: Decreased by 40 basis points to 22.5%.
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Net Loss: Posted a net loss of $13.5 million compared to net income of $11.0 million in the prior year.
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Adjusted EBITDA: Declined to $47.1 million from $49.8 million year-over-year.
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Free Cash Flow: Improved to $14.8 million from negative free cash flow of $4.4 million in the prior year.
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Debt Reduction: Total debt reduced to $809.2 million from $828.7 million at the beginning of the fiscal year.
The Hain Celestial Group Inc (NASDAQ:HAIN) released its 8-K filing on February 7, 2024, detailing its financial results for the fiscal second quarter ended December 31, 2023. The company, known for its better-for-you natural and organic food and personal-care products, has shown resilience in a challenging macroeconomic environment, delivering on its promise of sequential improvement and fuel generation through its Hain Reimagined strategy.
President and CEO Wendy Davidson expressed satisfaction with the company's progress, particularly in generating fuel through working capital management and productivity savings. Despite flat net sales compared to the previous year, organic net sales saw a slight uptick, benefiting from foreign exchange. However, the company reported a net loss of $13.5 million, contrasting with the net income of $11.0 million in the prior year period. Adjusted net income also fell to $10.9 million from $18.3 million year-over-year.
Financial Performance and Challenges
The company's gross profit margin experienced a slight decrease, primarily due to a 40-basis point drop to 22.5%. Adjusted gross profit margin, however, improved by 60 basis points. The adjusted EBITDA margin saw a 60-basis point decrease, reflecting the impact of inflation and lower sales volume, partially offset by pricing and productivity.
On the balance sheet, Hain Celestial managed to reduce its total debt and ended the quarter with a net secured leverage ratio of 4.2x, a slight improvement from the beginning of the fiscal year. The company's cash flow situation improved significantly, with net cash provided by operating activities increasing to $20.7 million from $2.5 million in the prior year period.
Segment Highlights and Outlook
The North America segment faced a 5.2% decrease in net sales, while the International segment continued to demonstrate strength with an 8.5% increase. Adjusted EBITDA for North America decreased by 18.9%, whereas the International segment saw a 35.0% increase.