The Hain Celestial Group, Inc., a natural and organic products company providing consumers with A Healthy Way of Life™, reported its results for the fourth quarter and fiscal year ended June 30, 2011.
Net sales in the 2011 fourth quarter increased 31.1 percent to a record $292.0 million as compared to net sales of $222.8 million in the fourth quarter of fiscal year 2010. The company’s growth momentum continued across its worldwide portfolio of brands in various classes of trade including natural, grocery, club, mass and dot-com channels coupled with contributions from strategic acquisitions. The company earned $12.8 million in net income as compared to $6.7 million in the fourth quarter of the prior year and reported diluted earnings per share of $0.28 as compared to $0.16 in the fourth quarter of the prior year. Adjusted earnings per diluted share was $0.35 on adjusted net income of $15.7 million in the 2011 fourth quarter as compared to $0.25 per share on adjusted net income of $10.6 million in the prior year fourth quarter. Adjusted net income and diluted earnings per share improved 48 percent and 40 percent, respectively, over the prior year fourth quarter. The company’s 2011 fourth quarter adjusted net income excludes acquisition related items, a discrete tax item and the impact of an impairment charge on properties related to discontinued operations at the company’s unconsolidated Hain Pure Protein investment.
Gross profit in the fourth quarter improved 186 basis points to 27.9 percent of net sales, as compared to the prior year fourth quarter, on the strength of a favorable mix of product sales worldwide and productivity savings, which helped offset increased input costs. In the 2011 fourth quarter, selling, general and administrative expenses were flat on a GAAP basis at 18.4 percent of net sales when compared to the prior year fourth quarter. Operating margin was 9.5 percent, an improvement of 373 basis points on a GAAP basis and 153 basis points on an adjusted basis, as compared to the prior year fourth quarter.
“Our fourth quarter results complete a strong year across our business with solid top- and bottom-line performance by the company,” said Irwin D. Simon, president and chief executive officer of Hain Celestial in a prepared statement. “Indications are that despite ongoing challenges in the economy, consumers continue to seek out healthful products from our natural and organic brands.
For the 2011 fiscal year the company reported record net sales of $1.13 billion, an increase of 23.2 percent from the prior year net sales of $917.3 million, reflecting growth across its worldwide portfolio including acquisitions. The company earned $55.0 million in net income as compared to $28.6 million in the prior year and reported earnings of $1.23 per diluted share as compared to earnings of $0.69 per diluted share in the prior year. Adjusted earnings per diluted share were $1.35 on adjusted net income of $60.2 million for the year as compared to $1.01 earnings per diluted share on adjusted net income of $42.0 in the prior year. On an adjusted basis, net income and diluted earnings improved 43 percent and 34 percent, respectively, over the prior year.
Gross profit in the fiscal year improved 89 basis points to 28.3 percent of net sales compared to 27.4 percent of net sales in the prior year. The higher gross profit performance resulted from the favorable mix of product sales along with productivity savings, which partially offset increased input costs. Operating margin was 9.4 percent on a GAAP basis this year, a 168 basis point improvement from 7.8 percent in the prior year. Selling, general and administrative expenses were flat at 18.8 percent of net sales for the year. On an adjusted basis, operating margin was 9.5 percent this year, a 75 basis point improvement from 8.8 percent in the prior year.
“We have focused on our core business and successfully integrated strategic acquisitions as part of our targeted execution and long-term strategy for sustainable growth. We plan to build upon these accomplishments in the future with the support of our customers, consumers, employees and shareholders,” concluded Simon.
