HAIN
$34.63
Hain Celestial Grp
($.35)
(1.00%)
Earnings Details
3rd Quarter March 2016
Wednesday, May 04, 2016 7:30:00 AM
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Summary

Hain Celestial Grp Misses

Hain Celestial Grp (HAIN) reported 3rd Quarter March 2016 earnings of $0.49 per share on revenue of $749.9 million. The consensus earnings estimate was $0.49 per share on revenue of $733.2 million. The Earnings Whisper number was $0.50 per share. Revenue grew 13.1% on a year-over-year basis.

The company said it expects fiscal 2016 earnings of $2.00 to $2.04 per share on revenue of $2.946 billion to $2.966 billion. The company's previous guidance was earnings of $1.95 to $2.10 per share on revenue of $2.90 billion to $3.04 billion and the current consensus earnings estimate is $2.01 per share on revenue of $2.94 billion for the year ending June 30, 2016.

Hain Celestial Group Inc and its subsidiaries manufactures, markets, distributes, and sells natural and organic products. Its product portfolio includes grocery, snacks, tea and personal care products.

Results
Reported Earnings
$0.49
Earnings Whisper
$0.50
Consensus Estimate
$0.49
Reported Revenue
$749.9 Mil
Revenue Estimate
$733.2 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Hain Celestial Announces Third Quarter Fiscal Year 2016 Results

The Hain Celestial Group, Inc. (HAIN), a leading organic and natural products company with operations in North America, Europe and India providing consumers with A Healthier Way of Life(TM), today reported results for its third quarter ended March 31, 2016.

Third Quarter Performance Highlights

Net sales of $750.0 million, a 13% increase, or 15% on a constant currency basis, over prior year period net sales of $662.7 million. Net sales were impacted by $13.9 million of foreign exchange rate movements versus a year ago.

Hain Celestial US net sales increased by 2.7% on a constant currency basis over the prior year period.

Earnings per diluted share of $0.47, a 47% increase over the prior year period, or on an adjusted basis $0.49, a 9% increase over the prior year period. Foreign currencies impacted reported results by $0.01 per diluted share.

Operating income of $69.0 million, or 9.2% of net sales; adjusted operating income of $80.4 million, or 10.7% of net sales.

Strong nine month operating cash flow of $131 million, an increase of 87% over the prior year period.

"Our net sales reflect the strong performance across our businesses led by Hain Celestial United States, Hain Pure Protein, Hain Celestial United Kingdom and Hain Celestial Europe as well as Hain Celestial Canada," said Irwin D. Simon, Founder, President and Chief Executive Officer of Hain Celestial. "The diversification of our product portfolio with leading organic, natural and better-for-you brands around the world, combined with our team’s solid execution of our operational initiatives fueled our financial performance. We are extremely pleased with our US results where we returned to growth in the third quarter and expect these trends to continue."

Third Quarter 2016 The United States segment reported third quarter net sales of $351.9 million. In the United Kingdom segment, net sales were $208.4 million. Hain Pure Protein reported net sales of $113.6 million, and the Rest of World segment reported net sales of $75.9 million. The Company had strong branded sales in constant currency led by Imagine?, Plainville Farms?, Terra?, Garden of Eatin’?, Tilda?, Yves?, FreeBird?, The Greek Gods?, Spectrum? and Sensible Portions? brands as well as its personal care brands, Alba Botanica? and Jason?. Net sales of Joya? brand and the Orchard House Foods business, both acquired after the third quarter of fiscal year 2015 also contributed to the net sales growth.

The Company earned net income of $49.0 million, a 47% increase, and adjusted net income of $50.6 million, a 9% increase, compared to the prior year period. Earnings per diluted share for the third quarter were $0.47, a 47% increase compared to the prior year period. On an adjusted basis earnings per diluted share for the third quarter were $0.49, a 9% increase compared to the prior year period. Refer to "Non-GAAP Financial Measures" section in this press release for reconciliations.

Project Terra As previously communicated, the Company commenced a strategic review under Project Terra and has identified approximately $100 million in global cost savings, which it expects to achieve during fiscal years 2017 through 2019. These initiatives are expected to include optimizing plants, co-packers and procurement and rationalizing the Company’s product portfolio, and reinvesting these incremental savings into the business to further brand building efforts and household penetration. Effective immediately, James R. Meiers has been appointed to the newly-created position of Chief Operations Officer for Hain Celestial reporting to Irwin Simon, with responsibility for achieving the cost savings across the Company’s worldwide operations.

The strategic review has also resulted in the Company redefining its core platforms for future growth based upon consumer trends to create and inspire A Healthier Way of Life(TM). The core platforms are now defined by common consumer need, route-to-market or internal advantage and are aligned with the Company’s strategic roadmap to continue its leadership position in the organic and natural, better-for-you industry.

Beginning in fiscal year 2017, the Company plans to establish five strategic platforms within Hain Celestial US with the purpose to drive accelerated net sales and margin growth. The platforms will be:

Fresh Living--includes poultry, yogurt, plant-based proteins and other refrigerated products;

Better-for-You Baby--includes infant foods, infant formula, diapers and wipe products that nurture and care for babies and toddlers;

-- Better-for-You Snacking--wholesome products for in-between meals;

-- Better-for-You Pantry--core consumer staples; and

Pure Personal Care--personal care products focused on providing consumers with cleaner and gentler ingredients.

In addition, the Company will launch Cultivate Ventures ("Cultivate"), a venture unit whose purpose is threefold: (i) to strategically invest in the Company’s smaller brands in high potential categories such as SunSpire? chocolates and DeBoles? pasta by giving them a dedicated, creative focus for refresh and relaunch; (ii) to incubate small acquisitions until they reach the scale for the Company’s core platforms; and (iii) to invest in concepts, products and technology, which focus on health and wellness.

https://photos.prnewswire.com/prnvar/20160503/363415

The Company has also identified certain brands representing approximately $30 million in sales, which no longer fit into its core strategy for future growth, and it intends to sell these as a group.

"We are excited about the launch of our new platforms in fiscal year 2017, which are uniquely aligned with consumer eating habits and usage needs," commented Irwin Simon. "We believe our platforms represent distinct opportunities for incremental growth and margin improvement. We expect this new approach will enable us to define more distinct channel strategies for our branded product offerings, and ensure that we continue to extend our organic and natural industry leadership position."

Fiscal Year 2016 Guidance The Company updated its fiscal year 2016 guidance expectations:

Total net sales range of $2.946 billion to $2.966 billion, an increase of approximately 9% to 10% as compared to fiscal year 2015, and

Earnings per diluted share range of $2.00 to $2.04, an increase of approximately 6% to 9% as compared to fiscal year 2015.

Guidance is provided on a non-GAAP basis and excludes acquisition-related expenses, integration and restructuring charges, start-up costs, unrealized net foreign currency gains or losses, reserves for litigation matters and other non-recurring items, including any product recalls or market withdrawals, that have been or may be incurred during the Company’s fiscal year 2016, which the Company will continue to identify as it reports its future financial results. Guidance excludes the impact of any future acquisitions.

Segment Results The Company’s operations are managed into the following segments: United States, United Kingdom, Hain Pure Protein and Rest of World (comprised of Canada and Continental Europe).

The following is a summary of results for the three and nine months ended March 31, 2016 by reportable segment:

(dollars in thousands)
United States
United Kingdom
Hain Pure Protein
Rest of World
Corporate/
Total
Other
NET SALES
Net sales - Three months ended 03/31/16
$
351,887
$
208,391
$
113,643
$
75,941
$
- $
749,862
Net sales - Three months ended 03/31/15
$
343,728
$
178,068
$
83,192
$
57,751
$
- $
662,739
% change - FY’16 net sales vs. FY’15 net sales
2.4%
17.0%
36.6%
31.5%
13.1%
OPERATING INCOME
Three months ended 03/31/16
Operating income
$
54,546
$
16,217
$
4,613
$
6,198
$
(12,567)
$
69,007
Non-GAAP Adjustments (1)
$
2,700
$
-
$
3,054
$
- $
5,701
$
11,455
Adjusted operating income
$
57,246
$
16,217
$
7,667
$
6,198
$
(6,866)
$
80,462
Adjusted operating income margin
16.3%
7.8%
6.7%
8.2%
10.7%
Three months ended 03/31/15
Operating income
$
55,851
$
11,760
$
4,970
$
4,412
$
(16,799)
$
60,194
Non-GAAP Adjustments (1)
$
3,188
$
3,838
$
- $
- $
10,326
$
17,352
Adjusted operating income
$
59,039
$
15,598
$
4,970
$
4,412
$
(6,473)
$
77,546
Adjusted operating income margin
17.2%
8.8%
6.0%
7.6%
11.7%
(1) See accompanying table of "Reconciliation of GAAP Results to Non-GAAP Measures"
(dollars in thousands)
United States
United Kingdom
Hain Pure Protein
Rest of World
Corporate/
Total
Other
NET SALES
Net sales - Nine months ended 03/31/16(1)
$
1,025,398
$
567,971
$
379,336
$
216,934
$
- $
2,189,639
Net sales - Nine months ended 03/31/15
$
1,034,612
$
551,144
$
240,078
$
164,545
$
- $
1,990,379
Non-GAAP Adjustments (2)
$
15,773
$
-
$
- $
928
$
- $
16,701
Adjusted net sales - Nine months ended 03/31/15
$
1,050,385
$
551,144
$
240,078
$
165,473
$
- $
2,007,080
% change - FY’16 net sales vs. FY’15 adjusted net sales -2.4%
3.1%
58.0%
31.1%
9.1%
OPERATING INCOME
Nine months ended 03/31/16
Operating income
$
149,233
$
45,189
$
33,009
$
12,981
$
(26,216)
$
214,196
Non-GAAP Adjustments (2)
$
6,597
$
1,020
$
3,940
$
515
$
10,293
$
22,365
Adjusted operating income
$
155,830
$
46,209
$
36,949
$
13,496
$
(15,923)
$
236,561
Adjusted operating income margin
15.2%
8.1%
9.7%
6.2%
10.8%
Nine months ended 03/31/15
Operating income
$
141,031
$
29,618
$
16,505
$
10,660
$
(34,781)
$
163,033
Non-GAAP Adjustments (2)
$
33,546
$
12,002
$
140
$
2,187
$
12,822
$
60,697
Adjusted operating income
$
174,577
$
41,620
$
16,645
$
12,847
$
(21,959)
$
223,730
Adjusted operating income margin
16.6%
7.6%
6.9%
7.8%
11.1%
(1) There were no Non-GAAP adjustments to net sales for the nine months ended 03/31/16
(2) See accompanying table of "Reconciliation of GAAP Results to Non-GAAP Measures"

Webcasts Hain Celestial will host a conference call and webcast at 8:30 AM Eastern Time today to review its third quarter fiscal year 2016 results. The conference call will be webcast and available under the Investor Relations section of the Company’s website at www.hain.com.

On Thursday, May 19, 2016 at 8:50 AM Eastern Time the Company is scheduled to present at BMO Capital Markets 2016 Farm to Market Conference. The presentation will be webcast and available under the Investor Relations section of the Company’s website at www.hain.com.

The Hain Celestial Group, Inc. The Hain Celestial Group (HAIN), headquartered in Lake Success, NY, 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’?, Sensible Portions?, Health Valley?, Arrowhead Mills?, MaraNatha?, SunSpire?, DeBoles?, Casbah?, Rudi’s Organic Bakery?, Gluten Free Caf?(TM), Hain Pure Foods?, Spectrum?, Spectrum Essentials?, Walnut Acres Organic?, Imagine?, Almond Dream?, Rice Dream?, Soy Dream?, WestSoy?, The Greek Gods?, BluePrint?, FreeBird?, Plainville Farms?, Empire?, Kosher Valley?, Yves Veggie Cuisine?, Europe’s Best?, Cully & Sully?, New Covent Garden Soup Co.?, Johnson’s Juice Co.?, Farmhouse Fare?, Hartley’s?, Sun-Pat?, Gale’s?, Robertson’s?, Frank Cooper’s?, Linda McCartney?, Lima?, Danival?, Joya?, Natumi?, GG UniqueFiber?, Tilda?, JASON?, Avalon Organics?, Alba Botanica?, Live Clean? and Queen Helene?. Hain Celestial has been providing A Healthier Way of Life(TM) since 1993. For more information, visit www.hain.com.

Safe Harbor Statement Certain statements contained in this press release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are predictions based on expectations and projections about future events, and are not statements of historical fact. You can identify forward-looking statements by the use of forward-looking terminology such as "plan", "continue", "expect", "anticipate", "intend", "predict", "project", "estimate", "likely", "believe", "might", "seek", "may", "remain", "potential", "can", "should", "could", "future" and similar expressions, or the negative of those expressions. These forward-looking statements include the Company’s beliefs or expectations relating to (i) the Company’s growth trends, initiatives and strategies with respect to Project Terra and its strategic platforms; (ii) the Company’s ability to achieve approximately $100 million in global cost savings; and (iii) the Company’s guidance for net sales and earnings per diluted share for fiscal year 2016. Such forward-looking statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results, levels of activity, performance or achievements of the Company, or industry results, to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, general economic and financial market conditions; competition; our ability to respond to changes and trends in customer and consumer demand, preferences and consumption; our reliance on third party distributors, manufacturers and suppliers; the consolidation or loss of a significant customer; our ability to introduce new products and improve existing products; availability and retention of key personnel; our ability to effectively integrate our acquisitions; our ability to successfully consummate any proposed divestitures; liabilities arising from potential product recalls, market withdrawals or product liability claims; outbreaks of diseases or food-borne illnesses; potential litigation; the availability of organic and natural ingredients; our ability to manage our supply chain effectively; changes in fuel, raw material and commodity costs; effects of climate change on our business and operations; our ability to offset input cost increases; the interruption, disruption or loss of operations at one or more of our manufacturing facilities; the loss of one or more of our independent co-packers; the disruption of our transportation systems; risks associated with expansion into countries in which we have no prior operating experience; risks associated with our international sales and operations, including foreign currency risks; impairment in the carrying value of our goodwill or other intangible assets; our ability to use our trademarks; reputational damage; changes in, or the failure to comply with, government laws and regulations; liabilities or claims with respect to environmental matters; our reliance on independent certification for our products; a breach of security measures; our reliance on our information technology systems; effects of general global capital and credit market issues on our liquidity and cost of borrowing; potential liabilities not covered by insurance; the ability of joint venture investments to successfully execute business plans; dilution in the value of our common shares; and the other risks detailed from time-to-time in the Company’s reports filed with the Securities and Exchange Commission, including the annual report on Form 10-K for the fiscal year ended June 30, 2015. As a result of the foregoing and other factors, no assurance can be given as to the future results, levels of activity and achievements of the Company, and neither the Company nor any person assumes responsibility for the accuracy and completeness of these statements.

Non-GAAP Financial Measures

This press release and the accompanying tables include non-GAAP financial measures, including adjusted operating income, adjusted net income, adjusted earnings per diluted share, adjusted EBITDA (defined below) and operating free cash flow. The reconciliations of these non-GAAP financial measures to the comparable GAAP financial measures are presented in the tables "Reconciliation of GAAP Results to Non-GAAP Measures" for the three months and nine months ended March 31, 2016 and 2015 and in the paragraphs below. Management believes that the non-GAAP financial measures presented provide useful additional information to investors about current 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. They should be read only in connection with the Company’s Consolidated Statements of Income presented in accordance with GAAP.

The Company defines Operating Free Cash Flow as cash provided from or used in operating activities (a GAAP measure) less capital expenditures. The Company views operating free cash flow as an important measure because it is one factor in evaluating the amount of cash available for discretionary investments. For the nine months ended March 31, 2016 and 2015, operating free cash flow was calculated as follows:

Nine Months Ended
03/31/2016
03/31/2015
(dollars in thousands)
Cash flow provided by operating activities $
131,853
$
70,169
Purchases of property, plant and equipment (58,022)
(36,312)
Operating free cash flow
$
73,831
$
33,857

Our operating free cash flow was $73.8 million for the nine months ended March 31, 2016, an increase of $40.0 million from the nine months ended March 31, 2015. The increase in operating free cash flow primarily resulted from an increase in net income. This was offset partially by an increase in our capital expenditures principally related to the purchase of a new factory location and production equipment in the Hain Pure Protein segment to accommodate current demand, as well as the expansion of production lines at both our ready-to-heat rice facility in the United Kingdom and our plant-based beverage facilities in Europe to accommodate new products and increased volume.

The Company defines adjusted EBITDA as net income (a GAAP measure) before income taxes, net interest expense, depreciation and amortization, impairment of long lived assets, equity in the earnings of non-consolidated affiliates, stock based compensation, acquisition-related expenses, including integration and restructuring charges, and other non-recurring items. The Company’s management believes that this presentation provides useful information to management, analysts and investors regarding certain additional financial and business trends relating to its results of operations and financial condition. In addition, management uses this measure for reviewing the financial results of the Company and as a component of performance-based executive compensation.

For the three months and nine months ended March 31, 2016 and 2015, adjusted EBITDA was calculated as follows:

3 Months Ended
9 Months Ended
3/31/2016
3/31/2015
3/31/2016
3/31/2015
(dollars in thousands)
Net Income
$
48,985
$
33,394
$
137,234
$
96,824
Income taxes
21,576
18,147
57,337
45,144
Interest expense, net
6,233
5,670
17,365
17,644
Depreciation and amortization
16,085
14,162
47,190
43,064
Equity in earnings of affiliates
161
13
108
(315)
Stock based compensation
2,776
2,935
10,004
8,934
Tradename impairment charge
-
5,510
-
5,510
Acquisition related fees and expenses,
4,190
5,572
10,855
8,789
integration and restructuring charges,
including severance, and other
Contingent consideration expense
1,511
-
1,511
281
Nut butter recall
-
-
-
30,110
European non-dairy beverage withdrawal
-
-
-
2,187
HPPC costs related to chiller breakdown and factory start-up costs
3,054
-
4,111
-
Ashland factory and related expenses
-
2,142
-
2,142
UK factory start-up costs
-
2,512
743
8,533
US warehouse consolidation project
-
-
426
-
Fakenham inventory allowance for fire
-
-
-
900
Litigation expenses
-
518
-
891
Celestial Seasonings packaging launch support and Keurig transition
2,700
-
4,704
-
Tilda fire insurance recovery costs and other start-up/ integration costs -
1,098
230
1,354
Gain on Tilda fire
(9,013)
-
(9,013)
-
Gain on pre-existing investment in HPPC and Empire Kosher
-
(2,922)
-
(8,256)
Adjusted EBITDA
$
98,258
$
88,751
$
282,805
$
263,736
THE HAIN CELESTIAL GROUP, INC.
Consolidated Balance Sheets
(In thousands)
March 31,
June 30,
2016
2015
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents
$
125,390
$
166,922
Accounts receivable, net
360,964
320,197
Inventories
394,958
382,211
Deferred income taxes
21,421
20,758
Prepaid expenses and other current assets
43,469
42,931
Total current assets
946,202
933,019
Property, plant and equipment, net
392,719
344,262
Goodwill, net
1,195,305
1,136,079
Trademarks and other intangible assets, net
643,940
647,754
Investments and joint ventures
20,034
2,305
Other assets
32,966
33,851
Total assets
$
3,231,166
$
3,097,270
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable
$
233,642
$
251,999
Accrued expenses and other current liabilities
93,050
79,167
Current portion of long-term debt
37,806
31,275
Total current liabilities
364,498
362,441
Long-term debt, less current portion
879,627
812,608
Deferred income taxes
142,188
145,297
Other noncurrent liabilities
5,986
5,237
Total liabilities
1,392,299
1,325,583
Stockholders’ equity:
Common stock
1,075
1,058
Additional paid-in capital
1,120,777
1,073,671
Retained earnings
934,748
797,514
Accumulated other comprehensive loss
(129,062)
(42,406)
Subtotal
1,927,538
1,829,837
Treasury stock
(88,671)
(58,150)
Total stockholders’ equity
1,838,867
1,771,687
Total liabilities and stockholders’ equity $
3,231,166
$
3,097,270
THE HAIN CELESTIAL GROUP, INC.
Consolidated Statements of Income
(unaudited and in thousands, except per share amounts)
Three Months Ended March 31,
Nine Months Ended March 31,
2016
2015
2016
2015
Net sales
$
749,862
$
662,739
$
2,189,639
$
1,990,379
Cost of sales
576,653
504,990
1,686,820
1,539,459
Gross profit
173,209
157,749
502,819
450,920
Selling, general and administrative expenses
93,915
83,068
262,776
262,613
Amortization/impairment of acquired intangibles
4,586
10,189
13,994
19,001
Acquisition related expenses, restructuring and
5,701
4,298
11,852
6,273
integration charges, and other
Operating income
69,007
60,194
214,197
163,033
Interest and other expenses, net
(1,715)
8,640
19,518
21,380
Income before income taxes and equity in earnings of
70,722
51,554
194,679
141,653
equity-method investees
Provision for income taxes
21,576
18,147
57,337
45,144
Equity in net loss (income) of equity-method investees
161
13
108
(315)
Net income
$
48,985
$
33,394
$
137,234
$
96,824
Net income per common share:
Basic
$
0.47
$
0.33
$
1.33
$
0.95
Diluted
$
0.47
$
0.32
$
1.32
$
0.94
Weighted average common shares outstanding:
Basic
103,265
102,252
103,030
101,401
Diluted
104,087
103,796
104,168
103,226
THE HAIN CELESTIAL GROUP, INC.
Reconciliation of GAAP Results to Non-GAAP Measures
(unaudited and in thousands, except per share amounts)
Three Months Ended March 31,
2016 GAAP
Adjustments
2016 Adjusted
2015 GAAP
Adjustments
2015 Adjusted
Net sales
$
749,862
$
- $
749,862
$
662,739
$
- $
662,739
Cost of sales
576,653
(3,054)
573,599
504,990
(5,928)
499,062
Operating expenses (a)
98,501
(2,700)
95,801
93,257
(7,126)
86,131
Acquisition related expenses, restructuring and
5,701
(5,701)
-
4,298
(4,298)
-
integration charges, and other
Operating Income
69,007
11,455
80,462
60,194
17,352
77,546
Interest and other expenses, net
(1,715)
9,149
7,434
8,640
(2,216)
6,424
Provision for income taxes
21,576
712
22,288
18,147
6,427
24,574
Net income
48,985
1,594
50,579
33,394
13,141
46,535
Earnings per share - diluted
0.47
0.02
0.49
0.32
0.13
0.45
(a)Operating expenses include amortization/impairment of acquired intangibles and selling, general, and administrative expenses.
Three Months Ended March 31,
FY 2016
FY 2015
Impact on Income Before Income Taxes
Impact on Income Tax Provision
Impact on Income Before Income Taxes
Impact on Income Tax Provision
HPPC costs related to chiller breakdown and
3,054
943
-
-
factory start-up costs
Ashland factory and related expenses
-
-
2,142
814
UK factory start-up costs
-
-
2,512
521
Acquisition and other integration costs
-
-
1,274
427
Cost of sales
3,054
943
5,928
1,762
Celestial Seasonings packaging launch support
2,700
833
-
-
Tilda fire insurance recovery costs and other start-up/
-
-
1,098
275
integration costs
Litigation expenses
-
-
518
197
Selling, general and administrative expenses
2,700
833
1,616
472
Tradename impairment charge
-
-
5,510
1,102
Amortization/impairment of acquired intangibles
-
-
5,510
1,102
Acquisition related fees and expenses, integration and
4,190
1,294
4,298
1,463
restructuring charges, including severance, and other
Contingent consideration expense
1,511
466
-
-
Acquisition related expenses, restructuring and
5,701
1,760
4,298
1,463
integration charges, and other
Unrealized currency impacts
(136)
(42)
5,138
1,628
Gain on Tilda fire
(9,013)
(2,782)
-
-
Gain on pre-existing investment in HPPC and Empire Kosher
-
-
(2,922)
-
Interest and other expenses, net
(9,149)
(2,824)
2,216
1,628
Total adjustments
$
2,306
$
712
$
19,568
$
6,427
THE HAIN CELESTIAL GROUP, INC.
Reconciliation of GAAP Results to Non-GAAP Measures
(unaudited and in thousands, except per share amounts)
Nine Months Ended March 31,
2016 GAAP
Adjustments
2016 Adjusted
2015 GAAP
Adjustments
2015 Adjusted
Net sales
$
2,189,639
$
-
$
2,189,639
$
1,990,379
$
16,701 $
2,007,080
Cost of sales
1,686,820
(5,578)
1,681,242
1,539,459
(25,059)
1,514,400
Operating expenses (a)
276,770
(4,934)
271,836
281,614
(12,664)
268,950
Acquisition related expenses, restructuring and
11,852
(11,852)
-
6,273
(6,273)
-
integration charges, and other
Operating Income
214,197
22,364
236,561
163,033
60,697
223,730
Interest and other expenses, net
19,518
1,706
21,224
21,380
(2,466)
18,914
Provision for income taxes
57,337
9,988
67,325
45,144
23,257
68,401
Net income
137,234
10,670
147,904
96,824
39,906
136,730
Earnings per share - diluted
1.32
0.10
1.42
0.94
0.38
1.32
(a)Operating expenses include amortization/impairment of acquired intangibles and selling, general, and administrative expenses.
Nine Months Ended March 31,
FY 2016
FY 2015
Impact on Income Before Income Taxes
Impact on Income Tax Provision
Impact on Income Before Income Taxes
Impact on Income Tax Provision
Nut butter recall
$
-
$
-
$
15,773
$
5,994
European non-dairy beverage withdrawal
-
-
928
316
Net sales
-
-
16,701
6,310
HPPC costs related to chiller breakdown and
3,895
1,263
-
-
factory start-up costs
US warehouse consolidation project
426
162
-
-
UK factory start-up costs
743
149
8,533
1,770
Acquisition and other integration costs
514
155
2,797
817
Ashland factory and related expenses
-
-
2,142
814
Nut butter recall
-
-
9,428
3,583
European non-dairy beverage withdrawal
-
-
1,259
428
Fakenham inventory allowance for fire
-
-
900
187
Cost of sales
5,578
1,729
25,059
7,599
Celestial Seasonings packaging launch support
4,704
1,595
-
-
and Keurig transition
Tilda fire insurance recovery costs and other start-up/
230
46
1,354
352
integration costs
Nut butter recall
-
-
4,909
1,864
Litigation expenses
-
-
891
339
Selling, general and administrative expenses
4,934
1,641
7,154
2,555
Tradename impairment charge
-
-
5,510
1,102
Amortization/impairment of acquired intangibles
-
-
5,510
1,102
Acquisition related fees and expenses, integration and restructuring
10,341
3,223
5,992
2,100
charges, including severance, and other
Contingent consideration expense
1,511
466
281
-
Acquisition related expenses, restructuring and
11,852
3,689
6,273
2,100
integration charges, and other
Unrealized currency impacts
7,091
2,344
10,957
3,561
Gain on Tilda fire
(9,013)
(2,782)
-
-
Gain on disposal of investment held for sale
-
-
(314)
-
Gain on pre-existing investment in HPPC and Empire Kosher
-
-
(8,256)
-
Interest accretion and other items, net
-
-
79
30
HPPC chiller disposal
216
82
-
-
Interest and other expenses, net
(1,706)
(356)
2,466
3,591
UK tax rate change impact on deferred taxes and
-
3,285
-
-
uncertain tax position reserve
Provision for income taxes
-
3,285
-
-
Total adjustments
$
20,658
$
9,988
$
63,163
$
23,257

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SOURCE The Hain Celestial Group, Inc.

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