ý
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Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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¨
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Transition Report pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
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Delaware
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22-3240619
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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1111 Marcus Avenue
Lake Success, New York
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11042
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
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ý
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Accelerated filer
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¨
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Non-accelerated filer
(Do not check if a smaller reporting company)
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¨
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Smaller reporting company
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¨
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Emerging growth company
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¨
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Part I - Financial Information
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Page
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|
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Item 1.
|
|
|
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||
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||
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Item 2.
|
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Item 3.
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Item 4.
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Part II - Other Information
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Items 3, 4 and 5 are not applicable
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Item 1.
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||
Item 1A.
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Item 2.
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Item 6.
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||
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September 30,
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June 30,
|
||||
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2017
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2017
|
||||
ASSETS
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(Unaudited)
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
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126,787
|
|
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$
|
146,992
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Accounts receivable, less allowance for doub
tful accounts of $736 and $1,
447, respectively
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272,341
|
|
|
248,436
|
|
||
Inventories
|
484,792
|
|
|
427,308
|
|
||
Prepaid expenses and other current assets
|
60,976
|
|
|
52,045
|
|
||
Total current assets
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944,896
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|
|
874,781
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|
||
Property, plant and equipment, net
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380,478
|
|
|
370,511
|
|
||
Goodwill
|
1,073,681
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1,059,981
|
|
||
Trademarks and other intangible assets, net
|
578,419
|
|
|
573,268
|
|
||
Investments and joint ventures
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19,109
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|
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18,998
|
|
||
Other assets
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35,264
|
|
|
33,565
|
|
||
Total assets
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$
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3,031,847
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|
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$
|
2,931,104
|
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LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
247,321
|
|
|
$
|
222,136
|
|
Accrued expenses and other current liabilities
|
111,746
|
|
|
108,514
|
|
||
Current portion of long-term debt
|
18,231
|
|
|
9,844
|
|
||
Total current liabilities
|
377,298
|
|
|
340,494
|
|
||
Long-term debt, less current portion
|
746,392
|
|
|
740,304
|
|
||
Deferred income taxes
|
124,166
|
|
|
121,475
|
|
||
Other noncurrent liabilities
|
16,460
|
|
|
15,999
|
|
||
Total liabilities
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1,264,316
|
|
|
1,218,272
|
|
||
Commitments and contingencies (Note 14)
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock - $.01 par value, authorized 5,000 shares; issued and outstanding: none
|
—
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|
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—
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|
||
Common stock - $.01 par value, authorized 150,000 shares; issued: 108,087 and 107,989 shares, respectively; outstanding: 103,748 and 103,702 shares, respectively
|
1,081
|
|
|
1,080
|
|
||
Additional paid-in capital
|
1,140,887
|
|
|
1,137,724
|
|
||
Retained earnings
|
888,668
|
|
|
868,822
|
|
||
Accumulated other comprehensive loss
|
(161,692
|
)
|
|
(195,479
|
)
|
||
|
1,868,944
|
|
|
1,812,147
|
|
||
Less: Treasury stock, at cos
t, 4,339 a
nd 4,287 shares, respectively
|
(101,413
|
)
|
|
(99,315
|
)
|
||
Total stockholders’ equity
|
1,767,531
|
|
|
1,712,832
|
|
||
Total liabilities and stockholders’ equity
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$
|
3,031,847
|
|
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$
|
2,931,104
|
|
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Three Months Ended September 30,
|
||||||
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2017
|
|
2016
|
||||
Net sales
|
$
|
708,276
|
|
|
$
|
681,464
|
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Cost of sales
|
576,673
|
|
|
571,597
|
|
||
Gross profit
|
131,603
|
|
|
109,867
|
|
||
Selling, general and administrative expenses
|
90,721
|
|
|
84,967
|
|
||
Amortization of acquired intangibles
|
4,911
|
|
|
4,728
|
|
||
Acquisition related expenses, restructuring and integration charges
|
5,846
|
|
|
461
|
|
||
Accounting review costs, net of insurance proceeds
|
(1,358
|
)
|
|
5,960
|
|
||
Operating income
|
31,483
|
|
|
13,751
|
|
||
Interest and other financing expense, net
|
6,315
|
|
|
5,081
|
|
||
Other (income)/expense, net
|
(3,137
|
)
|
|
(512
|
)
|
||
Income before income taxes and equity in net income of equity-method investees
|
28,305
|
|
|
9,182
|
|
||
Provision for income taxes
|
8,470
|
|
|
762
|
|
||
Equity in net income of equity-method investees
|
(11
|
)
|
|
(184
|
)
|
||
Net income
|
$
|
19,846
|
|
|
$
|
8,604
|
|
|
|
|
|
||||
Net income per common share:
|
|
|
|
||||
Basic
|
$
|
0.19
|
|
|
$
|
0.08
|
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Diluted
|
$
|
0.19
|
|
|
$
|
0.08
|
|
|
|
|
|
||||
Shares used in the calculation of net income per common share:
|
|
|
|
||||
Basic
|
103,709
|
|
|
103,468
|
|
||
Diluted
|
104,476
|
|
|
104,206
|
|
|
Three Months Ended
|
||||||||||||||||||||||
|
September 30, 2017
|
|
September 30, 2016
|
||||||||||||||||||||
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Pre-tax
amount
|
|
Tax (expense) benefit
|
|
After-tax amount
|
|
Pre-tax
amount
|
|
Tax benefit
|
|
After-tax amount
|
||||||||||||
Net income
|
|
|
|
|
$
|
19,846
|
|
|
|
|
|
|
$
|
8,604
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign currency translation adjustments
|
$
|
33,861
|
|
|
$
|
—
|
|
|
33,861
|
|
|
$
|
(31,736
|
)
|
|
$
|
—
|
|
|
(31,736
|
)
|
||
Change in deferred gains (losses) on cash flow hedging instruments
|
(82
|
)
|
|
15
|
|
|
(67
|
)
|
|
(430
|
)
|
|
35
|
|
|
(395
|
)
|
||||||
Change in unrealized gain (loss) on available for sale investment
|
(10
|
)
|
|
3
|
|
|
(7
|
)
|
|
(57
|
)
|
|
17
|
|
|
(40
|
)
|
||||||
Total other comprehensive income (loss)
|
$
|
33,769
|
|
|
$
|
18
|
|
|
$
|
33,787
|
|
|
$
|
(32,223
|
)
|
|
$
|
52
|
|
|
$
|
(32,171
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total comprehensive income (loss)
|
|
|
|
|
$
|
53,633
|
|
|
|
|
|
|
$
|
(23,567
|
)
|
|
Common Stock
|
|
Additional
|
|
|
|
|
|
|
|
Accumulated
Other
|
|
|
||||||||||||||||
|
|
|
Amount
|
|
Paid-in
|
|
Retained
|
|
Treasury Stock
|
|
Comprehensive
|
|
|
||||||||||||||||
|
Shares
|
|
at $.01
|
|
Capital
|
|
Earnings
|
|
Shares
|
|
Amount
|
|
Income (Loss)
|
|
Total
|
||||||||||||||
Balance at June 30, 2017
|
107,989
|
|
|
$
|
1,080
|
|
|
$
|
1,137,724
|
|
|
$
|
868,822
|
|
|
4,287
|
|
|
$
|
(99,315
|
)
|
|
$
|
(195,479
|
)
|
|
$
|
1,712,832
|
|
Net income
|
|
|
|
|
|
|
19,846
|
|
|
|
|
|
|
|
|
19,846
|
|
||||||||||||
Other comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
33,787
|
|
|
33,787
|
|
||||||||||||
Issuance of common stock pursuant to stock based compensation plans
|
98
|
|
|
1
|
|
|
(1
|
)
|
|
|
|
|
|
|
|
|
|
—
|
|
||||||||||
Shares withheld for payment of employee payroll taxes due on shares issued under stock based compensation plans
|
|
|
|
|
|
|
|
|
52
|
|
|
(2,098
|
)
|
|
|
|
(2,098
|
)
|
|||||||||||
Stock-based compensation expense
|
|
|
|
|
3,164
|
|
|
|
|
|
|
|
|
|
|
3,164
|
|
||||||||||||
Balance at September 30, 2017
|
108,087
|
|
|
$
|
1,081
|
|
|
$
|
1,140,887
|
|
|
$
|
888,668
|
|
|
4,339
|
|
|
$
|
(101,413
|
)
|
|
$
|
(161,692
|
)
|
|
$
|
1,767,531
|
|
|
Three Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
||||
Net income
|
$
|
19,846
|
|
|
$
|
8,604
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
17,626
|
|
|
17,220
|
|
||
Deferred income taxes
|
(637
|
)
|
|
(4,021
|
)
|
||
Equity in net income of equity-method investees
|
(11
|
)
|
|
(184
|
)
|
||
Stock based compensation
|
3,164
|
|
|
2,704
|
|
||
Other non-cash items, net
|
(2,871
|
)
|
|
(1,035
|
)
|
||
Increase (decrease) in cash attributable to changes in operating assets and liabilities, net of amounts applicable to acquisitions:
|
|
|
|
||||
Accounts receivable
|
(19,407
|
)
|
|
18,569
|
|
||
Inventories
|
(51,840
|
)
|
|
(37,707
|
)
|
||
Other current assets
|
(7,919
|
)
|
|
6,212
|
|
||
Other assets and liabilities
|
(389
|
)
|
|
(439
|
)
|
||
Accounts payable and accrued expenses
|
23,000
|
|
|
2,896
|
|
||
Net cash (used in) provided by operating activities
|
(19,438
|
)
|
|
12,819
|
|
||
|
|
|
|
||||
CASH FLOWS FROM INVESTING ACTIVITIES
|
|
|
|
||||
Purchases of property and equipment
|
(14,913
|
)
|
|
(14,553
|
)
|
||
Other
|
—
|
|
|
1,000
|
|
||
Net cash used in investing activities
|
(14,913
|
)
|
|
(13,553
|
)
|
||
|
|
|
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
||||
Borrowings under bank revolving credit facility
|
20,000
|
|
|
22,000
|
|
||
Repayments under bank revolving credit facility
|
(15,000
|
)
|
|
(26,500
|
)
|
||
Borrowings (repayments) of other debt, net
|
8,185
|
|
|
(2,976
|
)
|
||
Acquisition related contingent consideration
|
—
|
|
|
(2,498
|
)
|
||
Shares withheld for payment of employee payroll taxes
|
(2,098
|
)
|
|
(1,615
|
)
|
||
Net cash provided by (used in) financing activities
|
11,087
|
|
|
(11,589
|
)
|
||
|
|
|
|
||||
Effect of exchange rate changes on cash
|
3,059
|
|
|
(2,131
|
)
|
||
|
|
|
|
||||
Net decrease in cash and cash equivalents
|
(20,205
|
)
|
|
(14,454
|
)
|
||
Cash and cash equivalents at beginning of period
|
146,992
|
|
|
127,926
|
|
||
Cash and cash equivalents at end of period
|
$
|
126,787
|
|
|
$
|
113,472
|
|
•
|
As required, we prospectively recognized discrete tax benefits and deficiencies of
$599
in the income tax line item of our consolidated income statement for the three months ended
September 30, 2017
related to excess tax benefits upon vesting or settlement in that period.
|
•
|
We elected to adopt the cash flow presentation of the excess tax benefits retrospectively. As a result, we decreased our cash used in financing activities by
$405
for the three months ended September 30, 2016.
|
•
|
We have elected to continue to estimate the number of stock-based awards expected to vest, rather than electing to account for forfeitures as they occur to determine the amount of compensation costs to be recognized in each period.
|
•
|
We have not changed our policy on statutory withholding requirements and will continue to allow an employee to withhold at the minimum statutory withholding requirements. Amounts paid by us to taxing authorities when directly withholding shares associated with employees’ income tax withholding obligations are classified as a financing activity in our cash flow statement.
|
•
|
We excluded the excess tax benefits from the assumed proceeds available to repurchase shares in the computation of our diluted earnings per share for the three months ended
September 30, 2017
.
|
•
|
We did not have any material excess tax benefits previously recognized in additional paid-in capital, therefore, it was not necessary to record a deferred tax asset for the unrecognized tax benefits with an adjustment to opening retained earnings.
|
|
Three Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
Numerator:
|
|
|
|
||||
Net income
|
$
|
19,846
|
|
|
$
|
8,604
|
|
|
|
|
|
||||
Denominator:
|
|
|
|
||||
Basic weighted average shares outstanding
|
103,709
|
|
|
103,468
|
|
||
Effect of dilutive stock options, unvested restricted stock and unvested restricted share units
|
767
|
|
|
738
|
|
||
Diluted weighted average shares outstanding
|
104,476
|
|
|
104,206
|
|
||
|
|
|
|
||||
Net income per common share:
|
|
|
|
||||
Basic
|
$
|
0.19
|
|
|
$
|
0.08
|
|
Diluted
|
$
|
0.19
|
|
|
$
|
0.08
|
|
|
September 30,
2017 |
|
June 30,
2017 |
||||
Finished goods
|
$
|
295,794
|
|
|
$
|
264,148
|
|
Raw materials, work-in-progress and packaging
|
188,998
|
|
|
163,160
|
|
||
|
$
|
484,792
|
|
|
$
|
427,308
|
|
|
September 30,
2017 |
|
June 30,
2017 |
||||
Land
|
$
|
34,556
|
|
|
$
|
33,930
|
|
Buildings and improvements
|
118,553
|
|
|
116,723
|
|
||
Machinery and equipment
|
361,830
|
|
|
350,689
|
|
||
Computer hardware and software
|
52,740
|
|
|
51,486
|
|
||
Furniture and fixtures
|
16,480
|
|
|
15,993
|
|
||
Leasehold improvements
|
30,199
|
|
|
29,296
|
|
||
Construction in progress
|
22,907
|
|
|
16,119
|
|
||
|
637,265
|
|
|
614,236
|
|
||
Less: Accumulated depreciation and amortization
|
256,787
|
|
|
243,725
|
|
||
|
$
|
380,478
|
|
|
$
|
370,511
|
|
|
United States
|
|
United Kingdom
|
|
Hain Pure Protein
|
|
Rest of World
|
|
Total
|
||||||||||
Balance as of June 30, 2017 (a)
|
$
|
591,416
|
|
|
$
|
329,135
|
|
|
$
|
41,089
|
|
|
$
|
98,341
|
|
|
$
|
1,059,981
|
|
Reallocation of goodwill between reporting units (b)
|
(35,519
|
)
|
|
35,519
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Translation and other adjustments, net
|
—
|
|
|
10,785
|
|
|
—
|
|
|
2,915
|
|
|
13,700
|
|
|||||
Balance as of September 30, 2017 (a)
|
$
|
555,897
|
|
|
$
|
375,439
|
|
|
$
|
41,089
|
|
|
$
|
101,256
|
|
|
$
|
1,073,681
|
|
|
September 30,
2017 |
|
June 30,
2017 |
||||
Non-amortized intangible assets:
|
|
|
|
||||
Trademarks and tradenames (a)
|
$
|
431,321
|
|
|
$
|
424,817
|
|
Amortized intangible assets:
|
|
|
|
||||
Other intangibles
|
253,087
|
|
|
247,712
|
|
||
Less: accumulated amortization
|
(105,989
|
)
|
|
(99,261
|
)
|
||
Net carrying amount
|
$
|
578,419
|
|
|
$
|
573,268
|
|
|
Three Months ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
Amortization of intangible assets
|
$
|
4,911
|
|
|
$
|
4,728
|
|
|
September 30,
2017 |
|
June 30,
2017 |
||||
Credit Agreement borrowings payable to banks
|
$
|
739,678
|
|
|
$
|
733,715
|
|
Tilda short-term borrowing arrangements
|
16,490
|
|
|
7,761
|
|
||
Other borrowings
|
8,455
|
|
|
8,672
|
|
||
|
764,623
|
|
|
750,148
|
|
||
Short-term borrowings and current portion of long-term debt
|
18,231
|
|
|
9,844
|
|
||
Long-term debt, less current portion
|
$
|
746,392
|
|
|
$
|
740,304
|
|
|
Three Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
Foreign currency translation adjustments:
|
|
|
|
||||
Other comprehensive income (loss) before reclassifications
(1)
|
$
|
33,861
|
|
|
$
|
(31,736
|
)
|
Deferred gain
s/(losses)
on cash flow hedging instruments:
|
|
|
|
||||
Other comprehensive income before reclassifications
|
39
|
|
|
101
|
|
||
Amounts reclassified into income
(2)
|
(106
|
)
|
|
(496
|
)
|
||
Unrealized gain/(loss) on available for sale investment:
|
|
|
|
||||
Other comprehensive loss before reclassifications
|
(7
|
)
|
|
(50
|
)
|
||
Amounts reclassified into income
(3)
|
—
|
|
|
10
|
|
||
Net change in accumulated other comprehensive income (loss)
|
$
|
33,787
|
|
|
$
|
(32,171
|
)
|
(1)
|
Foreign currency translation adjustments included intra-entity foreign currency transactions that were of a long-term investment nature and were a gain of
$751
and a loss of
$7,152
for the three months ended
September 30, 2017
and
2016
,
respectively.
|
(2)
|
Amounts reclassified into income for deferred gains/(losses) on cash flow hedging instruments are recorded in “Cost of sales” in the Consolidated Statements of Income and, before taxes, were
$132
and
$620
for the three months ended
September 30, 2017
and
2016
, respectively.
|
(3)
|
Amounts reclassified into income for losses on sale of available for sale investments were based on the average cost of the shares held (See Note 12, Investments and Joint Ventures). Such amounts are recorded in “Other (income)/expense, net” in the Consolidated Statements of Income and were
$16
before taxes for the three months ended
September 30, 2016
. There were
no
amounts reclassified into income for losses on sale of available for sale investments for the three months ended
September 30, 2017
.
|
|
Three Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
Compensation cost (included in selling, general and administrative expense)
|
$
|
3,164
|
|
|
$
|
2,704
|
|
Related income tax benefit
|
$
|
1,234
|
|
|
$
|
1,014
|
|
|
Number of Options
|
|
Weighted
Average
Exercise
Price
|
|
Weighted
Average
Contractual
Life (years)
|
|
Aggregate
Intrinsic Value
|
|||||
Options outstanding and exercisable at June 30, 2017
|
122
|
|
|
$
|
2.26
|
|
|
|
|
|
||
Exercised
|
—
|
|
|
$
|
—
|
|
|
|
|
|
||
Options outstanding and exercisable at September 30, 2017
|
122
|
|
|
$
|
2.26
|
|
|
13.8
|
|
$
|
4,742
|
|
|
Number of Shares
and Units
|
|
Weighted
Average Grant
Date Fair
Value (per share)
|
|||
Non-vested restricted stock, restricted share units, and performance units at June 30, 2017
|
992
|
|
|
$
|
27.59
|
|
Granted
|
352
|
|
|
$
|
32.75
|
|
Vested
|
(98
|
)
|
|
$
|
24.98
|
|
Forfeited
|
(4
|
)
|
|
$
|
33.95
|
|
Non-vested restricted stock, restricted share units, and performance units at September 30, 2017
|
1,242
|
|
|
$
|
29.24
|
|
|
Three Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
Fair value of restricted stock and restricted share units granted
|
$
|
11,516
|
|
|
$
|
—
|
|
Fair value of shares vested
|
$
|
4,019
|
|
|
$
|
2,926
|
|
Tax benefit recognized from restricted shares vesting
|
$
|
1,567
|
|
|
$
|
1,139
|
|
•
|
Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;
|
•
|
Level 2 – Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability; and
|
•
|
Level 3 – Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity).
|
|
Total
|
|
Quoted
prices in
active
markets
(Level 1)
|
|
Significant
other
observable
inputs
(Level 2)
|
|
Significant
unobservable
inputs
(Level 3)
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
7,658
|
|
|
$
|
7,658
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Forward foreign currency contracts
|
66
|
|
|
—
|
|
|
66
|
|
|
—
|
|
||||
Available for sale securities
|
872
|
|
|
872
|
|
|
—
|
|
|
—
|
|
||||
|
$
|
8,596
|
|
|
$
|
8,530
|
|
|
$
|
66
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Forward foreign currency contracts
|
217
|
|
|
—
|
|
|
217
|
|
|
—
|
|
||||
Contingent consideration, current
|
2,853
|
|
|
—
|
|
|
—
|
|
|
2,853
|
|
||||
Total
|
$
|
3,070
|
|
|
$
|
—
|
|
|
$
|
217
|
|
|
$
|
2,853
|
|
|
Total
|
|
Quoted
prices in
active
markets
(Level 1)
|
|
Significant
other
observable
inputs
(Level 2)
|
|
Significant
unobservable
inputs
(Level 3)
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
21,800
|
|
|
$
|
21,800
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Forward foreign currency contracts
|
99
|
|
|
—
|
|
|
99
|
|
|
—
|
|
||||
Available for sale securities
|
882
|
|
|
882
|
|
|
—
|
|
|
—
|
|
||||
|
$
|
22,781
|
|
|
$
|
22,682
|
|
|
$
|
99
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Forward foreign currency contracts
|
$
|
53
|
|
|
$
|
—
|
|
|
$
|
53
|
|
|
$
|
—
|
|
Contingent consideration, current
|
$
|
2,656
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,656
|
|
Total
|
$
|
2,709
|
|
|
$
|
—
|
|
|
$
|
53
|
|
|
$
|
2,656
|
|
Balance as of June 30, 2017
|
$
|
2,656
|
|
Contingent consideration adjustment
(a)
|
174
|
|
|
Translation adjustment
|
23
|
|
|
Balance as of September 30, 2017
|
$
|
2,853
|
|
|
Three Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
Net Sales:
|
|
|
|
||||
United States
|
$
|
263,659
|
|
|
$
|
254,232
|
|
United Kingdom
|
222,445
|
|
|
220,151
|
|
||
Hain Pure Protein
|
119,057
|
|
|
116,669
|
|
||
Rest of World
|
103,115
|
|
|
90,412
|
|
||
|
$
|
708,276
|
|
|
$
|
681,464
|
|
|
|
|
|
||||
Operating Income:
|
|
|
|
||||
United States
|
$
|
20,861
|
|
|
$
|
18,794
|
|
United Kingdom
|
9,601
|
|
|
7,819
|
|
||
Hain Pure Protein
|
2,242
|
|
|
(1,018
|
)
|
||
Rest of World
|
8,997
|
|
|
5,055
|
|
||
|
$
|
41,701
|
|
|
$
|
30,650
|
|
Corporate and Other
(a)
|
(10,218
|
)
|
|
(16,899
|
)
|
||
|
$
|
31,483
|
|
|
$
|
13,751
|
|
|
September 30,
2017 |
|
June 30,
2017 |
||||
United States
|
$
|
196,087
|
|
|
$
|
194,348
|
|
United Kingdom
|
169,054
|
|
|
165,396
|
|
||
All Other
|
69,710
|
|
|
63,330
|
|
||
Total
|
$
|
434,851
|
|
|
$
|
423,074
|
|
|
Three Months Ended
|
|
Change in
|
||||||||||||||
|
September 30, 2017
|
|
September 30, 2016
|
|
Dollars
|
|
Percentage
|
||||||||||
Net sales
|
$
|
708,276
|
|
|
100.0%
|
|
$
|
681,464
|
|
|
100.0%
|
|
$
|
26,812
|
|
|
3.9%
|
Cost of sales
|
576,673
|
|
|
81.4%
|
|
571,597
|
|
|
83.9%
|
|
5,076
|
|
|
0.9%
|
|||
Gross profit
|
131,603
|
|
|
18.6%
|
|
109,867
|
|
|
16.1%
|
|
21,736
|
|
|
19.8%
|
|||
Selling, general and administrative expenses
|
90,721
|
|
|
12.8%
|
|
84,967
|
|
|
12.5%
|
|
5,754
|
|
|
6.8%
|
|||
Amortization of acquired intangibles
|
4,911
|
|
|
0.7%
|
|
4,728
|
|
|
0.7%
|
|
183
|
|
|
3.9%
|
|||
Acquisition related expenses, restructuring and integration charges
|
5,846
|
|
|
0.8%
|
|
461
|
|
|
0.1%
|
|
5,385
|
|
|
1,168.1%
|
|||
Accounting review costs, net of insurance
proceeds
|
(1,358
|
)
|
|
(0.2)%
|
|
5,960
|
|
|
0.9%
|
|
(7,318
|
)
|
|
n/a
|
|||
Operating income
|
31,483
|
|
|
4.4%
|
|
13,751
|
|
|
2.0%
|
|
17,732
|
|
|
129.0%
|
|||
Interest and other financing expense, net
|
6,315
|
|
|
0.9%
|
|
5,081
|
|
|
0.7%
|
|
1,234
|
|
|
24.3%
|
|||
Other (income)/expense, net
|
(3,137
|
)
|
|
(0.4)%
|
|
(512
|
)
|
|
(0.1)%
|
|
(2,625
|
)
|
|
512.7%
|
|||
Income before income taxes and equity in net income of equity-method investees
|
28,305
|
|
|
4.0%
|
|
9,182
|
|
|
1.3%
|
|
19,123
|
|
|
208.3%
|
|||
Provision for income taxes
|
8,470
|
|
|
1.2%
|
|
762
|
|
|
0.1%
|
|
7,708
|
|
|
1,011.5%
|
|||
Equity in net income of equity-method investees
|
(11
|
)
|
|
—
|
|
(184
|
)
|
|
—
|
|
173
|
|
|
94.0%
|
|||
Net income
|
$
|
19,846
|
|
|
2.8%
|
|
$
|
8,604
|
|
|
1.3%
|
|
$
|
11,242
|
|
|
130.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Adjusted EBITDA
|
$
|
59,512
|
|
|
8.4%
|
|
$
|
45,617
|
|
|
6.7%
|
|
$
|
13,895
|
|
|
30.5%
|
(dollars in thousands)
|
|
United States
|
|
United Kingdom
|
|
Hain Pure Protein
|
|
Rest of World
|
|
Corporate and Other
|
|
Consolidated
|
||||||||||||
Net sales
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Three months ended 9/30/17
|
|
$
|
263,659
|
|
|
$
|
222,445
|
|
|
$
|
119,057
|
|
|
$
|
103,115
|
|
|
$
|
—
|
|
|
$
|
708,276
|
|
Three months ended 9/30/16
|
|
254,232
|
|
|
220,151
|
|
|
116,669
|
|
|
90,412
|
|
|
—
|
|
|
681,464
|
|
||||||
$ change
|
|
$
|
9,427
|
|
|
$
|
2,294
|
|
|
$
|
2,388
|
|
|
$
|
12,703
|
|
|
n/a
|
|
|
$
|
26,812
|
|
|
% change
|
|
3.7
|
%
|
|
1.0
|
%
|
|
2.0
|
%
|
|
14.1
|
%
|
|
n/a
|
|
|
3.9
|
%
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Three months ended 9/30/17
|
|
$
|
20,861
|
|
|
$
|
9,601
|
|
|
$
|
2,242
|
|
|
$
|
8,997
|
|
|
$
|
(10,218
|
)
|
|
$
|
31,483
|
|
Three months ended 9/30/16
|
|
18,794
|
|
|
7,819
|
|
|
(1,018
|
)
|
|
5,055
|
|
|
(16,899
|
)
|
|
13,751
|
|
||||||
$ change
|
|
$
|
2,067
|
|
|
$
|
1,782
|
|
|
$
|
3,260
|
|
|
$
|
3,942
|
|
|
$
|
6,681
|
|
|
$
|
17,732
|
|
% change
|
|
11.0
|
%
|
|
22.8
|
%
|
|
320.2
|
%
|
|
78.0
|
%
|
|
39.5
|
%
|
|
129.0
|
%
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating income (loss)
margin
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Three months ended 9/30/17
|
|
7.9
|
%
|
|
4.3
|
%
|
|
1.9
|
%
|
|
8.7
|
%
|
|
n/a
|
|
|
4.4
|
%
|
||||||
Three months ended 9/30/16
|
|
7.4
|
%
|
|
3.6
|
%
|
|
(0.9
|
)%
|
|
5.6
|
%
|
|
n/a
|
|
|
2.0
|
%
|
|
Three Months Ended September 30,
|
|
Change in
|
|||||||||||
(amounts in thousands)
|
2017
|
|
2016
|
|
Dollars
|
|
Percentage
|
|||||||
Cash flows provided by (used in):
|
|
|
|
|
|
|
|
|||||||
Operating activities
|
$
|
(19,438
|
)
|
|
$
|
12,819
|
|
|
$
|
(32,257
|
)
|
|
(251.6
|
)%
|
Investing activities
|
(14,913
|
)
|
|
(13,553
|
)
|
|
(1,360
|
)
|
|
(10.0
|
)%
|
|||
Financing activities
|
11,087
|
|
|
(11,589
|
)
|
|
22,676
|
|
|
195.7
|
%
|
|||
Effect of exchange rate changes on cash
|
3,059
|
|
|
(2,131
|
)
|
|
5,190
|
|
|
243.5
|
%
|
|||
Net decrease in cash
|
$
|
(20,205
|
)
|
|
$
|
(14,454
|
)
|
|
$
|
(5,751
|
)
|
|
(39.8
|
)%
|
(amounts in thousands)
|
Hain Consolidated
|
||
Net sales - Three months ended 9/30/2017
|
$
|
708,276
|
|
Impact of foreign currency exchange
|
(4,143
|
)
|
|
Net sales on a constant currency basis - Three months ended 9/30/2017
|
$
|
704,133
|
|
|
|
||
Net sales - Three months ended 9/30/2016
|
$
|
681,464
|
|
Net sales growth on a constant currency
|
3.3
|
%
|
|
Three Months Ended September 30,
|
||||||
(amounts in thousands)
|
2017
|
|
2016
|
||||
Net income
|
$
|
19,846
|
|
|
$
|
8,604
|
|
Income taxes
|
8,470
|
|
|
762
|
|
||
Interest expense, net
|
5,620
|
|
|
4,354
|
|
||
Depreciation and amortization
|
17,626
|
|
|
17,220
|
|
||
Equity in earnings of equity-method investees
|
(11
|
)
|
|
(184
|
)
|
||
Stock-based compensation expense
|
3,164
|
|
|
2,704
|
|
||
Unrealized currency gains
|
(3,419
|
)
|
|
(1,293
|
)
|
||
EBITDA
|
51,296
|
|
|
32,167
|
|
||
|
|
|
|
||||
Acquisition related expenses, restructuring and integration charges, and other
|
5,846
|
|
|
1,408
|
|
||
Losses on terminated chilled desserts contract
|
1,472
|
|
|
—
|
|
||
U.K. and HPP start-up costs
|
1,083
|
|
|
—
|
|
||
Co-packer disruption
|
1,173
|
|
|
—
|
|
||
SKU rationalization
|
—
|
|
|
5,199
|
|
||
U.K. deferred synergies due to CMA Board decision
|
—
|
|
|
471
|
|
||
Accounting review costs, net of insurance proceeds
|
(1,358
|
)
|
|
5,960
|
|
||
Recall and other related costs
|
—
|
|
|
412
|
|
||
Adjusted EBITDA
|
$
|
59,512
|
|
|
$
|
45,617
|
|
|
Three Months Ended September 30,
|
||||||
(amounts in thousands)
|
2017
|
|
2016
|
||||
Cash flow (used in) provided by operating activities
|
$
|
(19,438
|
)
|
|
$
|
12,819
|
|
Purchase of property, plant and equipment
|
(14,913
|
)
|
|
(14,553
|
)
|
||
Operating free cash flow
|
$
|
(34,351
|
)
|
|
$
|
(1,734
|
)
|
Period
|
(a)
Total number
of shares
purchased (1)
|
|
(b)
Average
price paid
per share
|
|
(c)
Total number of
shares purchased
as part of
publicly
announced plans
|
|
(d)
Maximum
number of shares
that may yet be
purchased under
the plans (in millions of dollars) (2)
|
|||||
July 1, 2017 - July 31, 2017
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
250
|
|
August 1, 2017 - August 31, 2017
|
22,451
|
|
|
40.63
|
|
|
—
|
|
|
250
|
|
|
September 1, 2017 - September 30, 2017
|
28,967
|
|
|
40.95
|
|
|
—
|
|
|
250
|
|
|
Total
|
51,418
|
|
|
$
|
40.81
|
|
|
—
|
|
|
—
|
|
(1)
|
Shares surrendered for payment of employee payroll taxes due on shares issued under stockholder-approved stock-based compensation plans.
|
(2)
|
On June 21, 2017, the Company’s Board of Directors authorized the repurchase of up to $250 million of the Company’s
|
Exhibit
Number
|
|
Description
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
|
THE HAIN CELESTIAL GROUP, INC.
|
|
|
(Registrant)
|
|
|
|
Date:
|
November 7, 2017
|
/s/ Irwin D. Simon
|
|
|
Irwin D. Simon,
Chairman, President and Chief
Executive Officer
|
Date:
|
November 7, 2017
|
/s/ James Langrock
|
|
|
James Langrock,
Executive Vice President and
Chief Financial Officer
|
By:
|
|
|
|
|
Name:
|
|
|
Name:
|
|
Office:
|
|
|
Address:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of The Hain Celestial Group, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected or is reasonably likely to materially affect the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Irwin D. Simon
|
Irwin D. Simon
President and Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of The Hain Celestial Group, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected or is reasonably likely to materially affect the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ James Langrock
|
James Langrock
Executive Vice President and Chief Financial Officer
|
/s/ Irwin D. Simon
|
Irwin D. Simon
President and Chief Executive Officer
|
/s/ James Langrock
|
James Langrock
Executive Vice President and Chief Financial Officer
|