Hain Celestial (HAIN)

Anna Kate Heller Vice President, Investor Relations
Mark Schiller President & Chief Executive Officer
Chris Boever Incoming Executive Vice President & Chief Financial Officer
Javier Idrovo Executive Vice President & Chief Financial Officer
Anoori Naughton JPMorgan
Michael Lavery Piper Sandler
John Baumgartner Mizuho
Anthony Vendetti Maxim Group
Alexia Howard Bernstein
David Palmer Evercore ISI
Eric Larson Seaport Research
Rebecca Scheuneman Morningstar
Scott Mushkin R5 Capital
Call transcript
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Greetings, and welcome to Hain Celestial's Second Quarter 2022 Earnings Conference Call. At this time all participants are in listen-only mode. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Anna Kate Heller, Investor Relations. Thank you.

begin. may You

Anna Kate Heller

morning, Celestial's Good Call. for us joining Thank Quarter and Fiscal Hain Second Conference Year on you. thanks XXXX Earnings

On Executive Executive Mark Officer; the Idrovo of on Financial are Hain. and earnings Javier and call Executive call Chief final Chief Officer as Officer; Schiller, and Chris President President Vice President incoming his and Vice Chief Boever, today Financial

This being and it be And are the like the Hain include remarks from presentation statements under those expectations made of Form described are the earnings available this its and now expectations of of assumptions this time differ Mark and Commission Investor GAAP Relations performance. slide is will also securities the call, turn within forward-looking website cause Celestial's the those will implied to available financial actual from uncertainties Please and forward-looking a financial course on or reports XX-K, call today press results webcast, and make on XX-Q information, management's federal with statements call. financial that Exchange meaning involve detailed issued in could this focus could adjusted on discussion supplemental Schiller. additional Reconciliations the financial materially the in and to company's over results a from the on quarterly few archive to Form During the any also these on laws. website. report posted forward-looking time today. based measures the differ to actual to Celestial's Hain in measures. has may company non-GAAP These and I'd and regarding reports and current release refer future materially non-GAAP slides annual the filed of other The expressed prepared and and presentation management which events to risks that risks for an or on Securities statements. operations note, morning accompanying management's are of release statements These heading. Please call

Mark Schiller

Thank and our year morning. well the good of call, forecast color performance as Day. you, we QX and Investor On Hain I'll give balance on progress laid as some strategy Anna Kate, out on X.X against today's

who of work, also Idrovo Joining like in Boever. Javier X.X to Chris, assistance me want thank on I officially of this begins to brings his his all I starting forward Hain to are role operating our and welcome background opportunity company hard experience and He a wealth tomorrow. duties. our today him I'd and partnering to call with X.X his the Hain and take to his Javier to I'm for Chris introduce leadership on excited joining Chris journey. CPG look deep contributions team. transitioning as and exceptional smoothly CFO very skills. his have a

Chris me turn to Let it to few over a words. say briefly

Chris Boever

was X.X so and looking grow company, I'm to This forward great team. Thanks, to seen I global wellness the very a a to leading confirmed at and excited to and talented the lead are value. positioned brands shareholder exceptionally well and we Hain helping and with journey continuing my Hain week good morning, everything the I've is everyone. Mark, and join has Hain is company. reasons third health

Mark Schiller

the Thank Chris, and again, team. welcome you, to

and original our call our delivered color giving today's results. on end of pre-earnings we announcement in at January. QX pleased our some by guidance Let that line in with line the high me performance start top I'm

and our line leading bottom original came growth supply growth profitability, challenges. slightly accelerating continued company. our in chain top our well-publicized more strong line As to we're I'll brands discuss by to With and seeing industry-wide is in the below detail, in for regard guidance, labor consumption driven that

deeper While and years to those guidance. costs, adjusted which quarter, discuss in all additional our the original currency X%. line, year in on pandemic, productivity divestitures pricing I'll were adjusted up of a job million net $X we X% offset acquisitions, the EBITDA almost is the about the brands. and were more Compared a before discontinued to with these costs, great incremental late led down top sales ago a unforeseen with to minute. miss Digging team versus when sales did a adjusted doing net for and two experience ago, some

were our States which I'm versus biggest versus quarter is two brands, pleased for last sequential Adjusted X.X% ago. the growth was in and and testament quarter quarter report States, channels versus market, in up to net This the measured success brands year our ago sales United and plan. confidence XX% to a almost XX% up year Our up the ago. to in us Hain years consumption make And XX.X% strong that last further compared up our up Hain US were in material were of gives divestitures, all to last improvement. show sales compared for a and and the years to two the over continue two X. slightly year company versus United ago. in X% total of same XX% X.X X.X sales years net

Seasonings and which snacks, consumption XX% share Household and point in ago. care growth growth again those up up two led versus two than years than baby in XX% was up make growth on QX Snacks XX% with last more single-digit year-over-year. US sales of year brands growth tea, full categories, a year on and gained last delivered and penetration of top personal growth XX% years of Celestial yogurt, XX% more growth quarter versus brands terrific Garden and and at driven food high the retail some way than almost early more up architecture. baby versus ago. a size solid per overlapping velocities nicely price significant X% year. consumption Eatin' chain were digits also from quarter the and product brands Gods challenges. quarter, growth also in supply growth supply I'm to reformulation Unit the in in see on items increasing Greek on Our US the the stabilize prices the store work even last and significant increased by encouraged despite average in up growth on mid-single on consumption after chain challenges of with

QX adjusted accelerated So expected, in top year imports In baby came year customers and on up on that sales seeing driven momentum below regulations overlap a US far of disruptions net QX. increased and growth ago the of stocking food summary, in last in we're thus in as China. tremendous International, line the in by the Brexit in has anticipation

of to long-term We expect International QX, those years strategy both our outlook. were into Relative but issues sales net have up on our ago, and two X.X%. to no continue impact

baby gained marmalade. Within growth share meat both the we quarter than points than more this in and more soup also year, X jelly in grew XX% did share and and deliver and snacks, free

improve also and XX% we adjusted UK in entire to saw quarter Importantly, our original regard below for half. company-wide business. than on the EBITDA, velocities guidance our first With more came a bit we

that small things, limited happened giving on While in there back we continued two time to of pressure these. the half to both primarily miss costs, be was The us offsetting pleased were of say which respond. to I'm the most attributed certainly can quarter,

a to much last in where XX they what Yes, times. half to $XXX significant Europe, the increased in moment, as prices $X,XXX month Imagine quarter energy went back bill the month that this faced experienced economy the costs we QX. during what as of we from you times correctly, of the last a year. in impact for on winter a everyone's winter. First, heard That's XX accelerated heating Europe were

and come have for started locked fiscal inflated, the in energy reflected they in of year, Fortunately, our somewhat, which are while we energy down prices balance go-forward still revised are the have to contracts guidance.

offset experienced and projects have challenges in this in industry, the created fiscal variant continue chain, were consumer later many Omicron and we the very the appears quarter. year, Switching inflation of peaking, decisions, we that some be half during internationally. both good global supply velocities, the the and here additional quarter. we're service costs, surgical first margins. high our of related disruptions To which Like pricing throughout in the continued that analyzing aggressively and productivity short-term and should drive the gaps momentum. in loyalty significant of We Omicron is emergence to brand signs taken of price the to the supply pricing rest including news abating third and The challenges labor both costs. here to result thresholds, these impacting seeing and variables, shortages brand Second,

become over the we days. are $XXX taken in we're has in customers in half our you've as our next effective guidance. increases with than the unit have In additional to earlier, year has updated all taking North both and of price this speak. we million So the XX impact In and year. more will discussions increases effective heard the total, been and gears America Shifting of international, far, our very been minimal. process as second of pricing volume Those pricing will

pricing implies the North second have continue several distribution acquisitions for have brands. we We and merchandising secured growth in currency, momentum, by low discontinued high adjusted continued programs in That and to consumption expect benefit expect divestitures, half, market. for mid- additional where of growth single-digit sales the net have to America, the year, single-digit expansion, driven large

the company front, X% a estimate total for margin inflation about versus On plan entire we our to XX% be X%. now of the around to

out-of-plan air These also and from service-related sources incremental a shortages total of areas, notice, supply We to the number transportation production stocks and million freighting year and costs million this supply $XX short about backup of finding disruptions. including to of related materials, additional prolonged emanate of fines, very on material of disruptions. $XX out a expect costs

industry-wide and chain While we and line inflation offset are gains growth productivity, by top expect the and labor pricing continued external challenges. those strong solid disruptions supply and being on

many year Elaborating algorithm few January that time, years XX% of by XX% recent brands on minutes. with growth our that While lowered our provide go in we've to the will strong for momentum details the than ending realities. our ago. the now in guidance we most Javier those more will and two EBITDA encouraged business we in those we're forecast with further momentum anticipate reflect versus unveiled up growth away our on more weeks very X.X, consumption costs and over XX four Hain the a US on

of emphasized and drivers innovation the distribution importance acceleration. expansion as strategy X.X Our key our top line of

are momentum our by in categories. that additional strong and attracting have and velocity We customers products new both brand areas consumers driven to

and also our growth brands. to investing about household penetration across awareness marketing in We drive talked

recall Also While more accelerate high-growth strategy plan year. invest growth categories to cost pressures, intent the that short in due continue our highlighted like X.X limited reshaping term, this our This year our snacks. been to our acquisitions further includes investments to strategy for we have portfolio. to next making

recently turkey. We categories growth like business, bars As significant brand. brands, we you It segments incremental us will ParmCrisps snacking, Snack beef, How from And included geographies. we to in channels existing launched competitors recently like scale rest which expect we high-growth opportunities ParmCrisps acquired innovation. in in company, also additional Roll access have us the expansion another gives our like where distribution That's know, new volume the snack This new source also and and highly the Mix, gives of high-protein and which

pricing synergies. the we side, be result margins average, in with adjusted realize and additional both nominal the next will EBITDA highly contribution as making brand, the margin accretive this while short-term pursue and productivity invest this fiscal and profit line top acquisition year, line. on company the should in By bottom in the On

challenging importantly, on are remain our Javier strong of we're detail. financials very proud that, strategy. a let by it. me track to deliver more over momentum And it how discuss X.X encouraged achieving the we're and extremely summary, line Hain excited and turn to With in we business are navigating now are in So environment top to about our we

Javier Idrovo

of I and wish and my to Hain journey, continued the thank Board I everyone, has also success. colleagues. take and this It the much, opportunity exciting an Mark. thank rest been you company the morning, Good very want to

Now turning to the financials.

our journey. highlight Let and second we of platform move growth few key of building into that a Hain me of quarter aspects our plan X.X execution as a strong results the transformation demonstrate solid

original First, our line at demonstrated in high sales challenging and guidance we operating resilience top a of delivered results environment. end the

environment International inflationary EBITDA supply overall the industry, growth. and despite versus entire margin Second, chain highly improved our challenges quarter the business year, another of impacting prior and the delivered EBITDA adjusted adjusted our

we that good capital remains our we well I on are our guidance discussion finally, our Third, our these as And as start full top strong each laid new long-term into allocation well with presentation and Investor sheet line a flexibility. the aspects. updated positioned balance believe deliver will Day then to out of with during will drill results, algorithm last I we September. year of

forward, we XX% overlap demand COVID surge pull year's consolidated million. year-over-year to second last $XXX decreased As quarter a Brexit-related net demand sales and

lower sales discontinuations Foreign by versus high planned was X% to is in exchange guidance first offset was X%, first the of compared period. sales impact about sales a half were sales the close end by decrease. low translates factors, two adjusted these decline sales brand the quarter percentage divestitures net to half for in sales This year quarter and at a higher year quarter. which driven reduced single-digit the second adjusting partially the mainly prior to When X% of provided sales down on by the previously for decrease international, minimal, net while of The prior US. net the net

was The expansion points. points. about year in forecasting costs the higher-than-expected higher-than-planned service, that of fiscal During we challenges adjusted experienced rest deliver about issues Despite XXX the to where a we all period for our incurred international industry-wide XX impacted we customer a operations labor-related year international came lower our that prioritize were reduction segment basis QX inflation in of XXXX. spending in and these versus about driven XXXX. of headwind gross to with carrier also about by in and freight compared resulting at quarter, the by now of small net year warehousing labor margin freight gross headwinds, disruptions. regions, of America, other the chain mostly are largely was basis sales points quarter, when marketing, energy points to basis brands year in pressures we net adjusted favorability able lower including segment we the fiscal reduced sales shortages, XXX SG&A, cost as and cost across Total our facing percent XX% prior throughout distribution the broker period, including availability driven The continued by still fees. than remain sales costs corporate of to added supply basis XX lower margin Marketing expenditure North by reduced supply prior and on

mentioned year quarter While XX.X%, adjusted ago basis adjusted EBITDA the primarily driven EBITDA SG&A X.X costs. decreased versus by to $X margin million, a second X% in XX previously increased to points reduction year-over-year by

increased PSU stock-based second adjusted XX% prior year compared tax year in We the EPS XX% rate Our driven of period, an in of mostly benefited from deductions to from by adjusted prior period. quarter $X.XX to compensation vesting. $X.XX compared related to the

are Now in Starting consumption. before, continue but detail where North let segments. discussed chain continued seeing some me issues the we we individual American business, provide on to reporting the industry-wide supply with face have our momentum

decreased line, X% $XXX top million. the to sales for quarter year-over-year the reported second about net On

exchange versus However, X% the movements, net was for after a prior targeted sales basis the net period versus that's tea we about business. XX. close close prior growth profitability to daily transaction a gross fiscal delivered In investment the and growth adjusted pre-pandemic less net QX to versus versus our From two year. the how period and impact XX growth closing foreign adjusting divestitures period period. and sales American yogurt driven turbocharge our and category, XX% the basis years the than points acquisitions with performance QX acquisition year growth contributing December snacks -- to XX.X%. of year strong for versus The margin given XXXX, of perspective, period by XX% the by our roll for our of growth XXX year date the of food quarter to the year The decreased prior increased North prior versus XX% delivered business points category sales year the ago products products versus prior

sequential prior points a improvement XXX the versus basis represented this quarter. However, about of

year the the to impacted EBITDA million actions from QX challenges margins. of chain supply $XX profitability the in our industry-wide quarter, sequential in sequential initiatives the about Adjusted to decrease basis and XX% versus prior pricing a represented productivity year but EBITDA XX.X% the improvement a XXX contributed of improvement XXXX. XXX of Adjusted points While decreased period. a basis prior period, of points margin year about fiscal QX versus

for versus the year year. partially and fiscal movements million driven increased of close labor-related to quarter margin by about for by the by growth flow driven our our From of second the our The basis decreased by QX to the XX%, versus year the ago for of gross Shifting shift adjusting currency delivered adjusted sales profitability me softness which X% volume the Net and of net period from the expenses. close the growth in period, China balance QX third-party XXXX. year sheet. million the the QX in divestiture XX%. quarter to margins sales lower of improved fiscal year daily lower half energy was costs sales first fiscal prior EBITDA was of to Brexit-related currency QX for to growth forward XXXX prior a performance higher and Now XX% Operating food cash impact costs. X%. and basis. points down for divestitures, and brands, of the XXX a let International on XXXX, business and lapping were adjusted reported net flow $XX by adjusted the gross aggregate versus period, After EBITDA $XX our driven We prior to business. by margin expenses cash years points, versus by and constant year X% adjusted food and Compared two pull during SG&A in around year XXX growth driven the offset business of for the grew about to by our International increased productivity basis higher-than-expected initiatives, standpoint, exports

spending half were supply second operating the which lower flows $XX.X under half, lower than cash or Act year million from first net XXXX. expected than for While year tax the given half spending fiscal claim a availability. prior the the first was labor benefited CARES during refund quarter sales, first and challenges company Capital the of chain reflected X.X% of

we X% and under to on For the leverage amended X.X% spending sales. the X.X net be full net the was as calculated agreement credit at end now of of at million, capital stood was between expect Net while debt Cash debt $XXX million. hand year, times. $XX quarter

with of after authorization authorization end program has XXXX additional leaving repurchase is an authorization commence shares Our $XXX second the balance under share $XXX Consistent at to repurchases average price us authorization. its existing the an share result, strong, utilized. commissions, our with additional remains in the approximately million and the we capital Board million, company our company's both for Directors of or X.X% with sheet of a of principles total to and we excluding of remaining X Share quarter, at will the about a $XX.XX business today $XX significant of million flexibility stock also common outstanding this fully return value repurchased announced million shareholders. repurchase have the under reinvest quarter. as allocation during The that approved per

outlook. our to turning Now

net Compared we low growth. our year full for adjusted guidance our XXXX. XXXX, net expect reaffirming sales guidance a profit bit single-digit fiscal sales year year lowering and are to We fiscal

from gross and by EBITDA sales net as-reported XXX from basis approximately the adjusted currency. Modest sales adjusted acquisitions and basis growth. divestitures reduction lower XX and margin adjusted the than net flat points With points growth, growth about

our guidance. Let me color give on some you updated

the earlier expect the in business. performance our our our deliver half versus in line top for optimism adjusted call. We growth the American Mark reasons mid- high range, second to North to single-digit the prior largely by explained year driven of

updated Given full for have the we adjusted EBITDA year. under, high inflationary we operating and adjusted margin environment that are the gross our guidance

actions supply costs our additional the international to expected in chain continues increases challenges energy company added of to to are overcome Specifically, year. cost fiscal have to the that for the and P&L and continue take rest

productivity these and will the X.X profitability along our extraordinary achieving pricing remain with Hain that targets. Given eventually in expectation actions confident our initiatives challenges

the EBITDA For in of an additional environment continued versus was of year performance challenging chain fourth year second quarter that QX pricing initiatives. call the were improvement to while turn year and of throughout supply exceptionally deliver performance that prior second momentum given the challenges fiscal quarter its our X.X XXXX the XXXX positioned quarter to financial expects throughout year. and all to full making adjusted operating activity back In the growth summary, deliver company context aspirations. this fiscal with has again progress the we anticipated long-term have results is the sequential to year, to year growth Hain half now quarters the already by a deliver Hain highest well time prior that by impacted strong I EBITDA able of our implementation adjusted in the on our will to Mark.

Mark Schiller

resilience solid hard throughout and a by thanking questions. X.X world With employees thousands who a us environment. Again the helped work have attitude, exceptionally your have as toward and making performance around now vision scrappiness take to serve deliver teamwork dedication in can-do we'll to Their continue our will we and said, pandemic worked their that of us reality. Hain challenging well very the our


JPMorgan. Ladies question at Instructions] you. Naughton with will proceed be the [Operator comes your question. question-and-answer time with we Thank from a of Please first line gentlemen, and session. this conducting Our Anoori

Anoori Naughton

Hi, good morning.

Mark Schiller

Good morning.

Anoori Naughton

in new more environment? guidance understand -- for helpful today's conservative making? give are Like for wanted the you to that it us that this for It a assumptions what pretty half, the for the fourth for you're about enough a would to that's is I about back But volatile update cadence quarter, ramp providing guidance ask bit helpful. thank little EBITDA and growth. implies your you got significant be confidence enough

Mark Schiller

question. Thank for the Yes. you

been on this some have for we quite time. journey So obviously

in coming that's to second half. We productivity have fruition the

are second have EBITDA. We drive in acceleration volume that some will that we the half expecting that of

second We up. pricing because, the have coming will the before margins that half again, the inflation is pricing improve also catches in the hitting more

-- mix some the we well. we in and expect So half second improvements as

and significant will So our be confident we improvement quarter, EBITDA. also a have that together which also I helpful think to in And you this driving last that we're put overlap fourth all terms year, in remember, we we challenging which of get year, will that had EBITDA growth

Javier Idrovo

Mark, if I second to that of may, have cost visibility our going like for I would we to goods also forward strong half. add quite a the

more are spending. we So than visibility the probably than more having XX% -- for

second So the cost we we forces that half about as embedded the have feel pretty well. in good

Anoori Naughton

Great. the in inventory helpful. assumptions second then just embedded reload to on quarter, in stand? what's and where US. expected you can the us were -- for And customers in us you on your you update I you think the half? back some And just do That's super update Can

Mark Schiller


is our most but So disruptions we -- our industry-wide that strong with. related across the are we inventories everybody supply to issues relatively of brands, some familiar had have

And within terms of of are some at what still gap where there inventory levels or customers couple they've our a so segments been historically. in brands have brands versus we

did half assumed as that expect we but those just that the the improvement half, haven't in on we we second issues We first some will that completely go make away. on

we help places fill in approach what of to challenges. have visibility have terms balanced a of we in where us kind what think pipeline place we and the So on again, we're have those I to taking

Anoori Naughton

you. Thank Great.


question comes Piper proceed the of Lavery your Please Sandler. Michael with next Our with from line question.

Michael Lavery

Good morning. Thank you.

Mark Schiller

Good morning, Mike.

Michael Lavery

does cost It on move energy like very sounds a or mean the piece. matter, options touch it upside obviously, significant locked pressure just you improves, it that is to or sounds to but Can can't clarify, speaking potentially where that and you've that worse you some of get numbers? your EU if it the in. have wanted might like Just cost obviously better, to

Mark Schiller

much in. pretty it's locked No,

the what earnings, added second be. versus which completely in the ago and cost, half that the and visibility will the year is risk it's of of have happened original versus around It's of year. million our So some -- of rest added the quarter happen inflationary even we about significantly which it clarity and plan a and that QX And in and down Like as as was a $XX first in. And year-over-year. and certainty will least completely us inflationary. change our it's it the I was have times, we of it it XX% much again, year visibility this oversimplifying locked in what now bit. ago, EBITDA We XX it's, come a guidance. while explains for that said, At It's highly at probably up point. inflationary to

Michael Lavery

Okay. That's helpful. on And just another pricing. one Great.

any orders is you're just is characterize with said just real some it discussions the in sense of nature around us Is just of pricing You tweaks that? what the of edges. Can guess magnitude of more and you sort Can like? you feels has I there automatic like negotiating customers. the some give or it pushback, there a become or almost resistance in this dialogue environment.

Mark Schiller


world. the the of it's little the think I in versus bit there's a different -- rest US

me labor their general feeling So challenges. challenges around everyone's because their recognition In customers and there's with US, inflation certainly the including those take the supply let chain separately. it,

couple saw so And our where we space. largely conversations And negotiation got much the private a contracts. there's a story are more And expected, first change -- fronts. I we difficult you on happen have a have that that the half because, Number when have as well. business, very think a shelf But the particularly significant often, as in it's as here It's different of we anticipate through, and recognition it's little Every needed. where will always a Europe, taking well. for very International it. pricing give pricing a one, in they again, you of going general is contracts, to bit a get. pricing is there's control company we label is those

punitive. are more those retailers the to more conversations. pricing and more challenging resistant are just going to much there So be be much And can

in, pricing half of end but conversations of of for a the impact it to we had as that all that. a couple that for are distribution there's get general But first in in the happen. do now expect give the get It's year, again, the I just negotiate. that before lost day. We of pricing pricing as got action, the we what's get did the question having needs pricing a that, categories And half. Now in in. result some the we the We from continue recognition the of to second we a will

Michael Lavery

helpful. so Thanks much. Really


Our line Baumgartner of with Mizuho. next with question comes your proceed from question. John Please the

John Baumgartner

Good question. for the morning. Thanks

Mark Schiller

Good morning, John.

John Baumgartner

outlook. just the into I confidence off, can you for to and what terms target? you chain if reiteration of months here environment from How Omicron see about think six But materialize sales or supply supply walk think first do don't been or visibility tough as F forecast we XXXX, the doesn't or risk, next resets that innovation COVID chain mean so? that following to whether do just Maybe through net the shelf that you extent the launch? Obviously, about has for the we can in the of see.

Mark Schiller


significant got at confidence getting the seeing place very consumption growing momentum. volume for time. or our distribution in and is particular, We're pricing North same high. We've in So America got unit We've US the momentum.

We have have some about talked programs that merchandising on previous calls. secured we've that big been

interesting North material year in store. versus grocery international, a a And In right in international the down are entire by what's in the sales store now ago, US business. so entire we acceleration UK, will America is, the driven see

the lost is, of And some period year their are So country were that in And gaining occasions a the the people our to we've share now of home the as those of categories and back home. in so lunch expectation everybody opened where while the from are they've up lack left as from travel. some work, ago was categories, we're and some going the occasion our lockdown in we down. kids and house, the school being

see and will will we third short brands the store there, again, that because entire but our as end through get will share. the the to mitigate lived. of we affecting it's we gaining So quarter, are that, expect that think we be continue that And

double-digit brands Our are velocity seeing growth.

the environment our the will have with entire our it. fact and as share kind as we come of confidence so that that in And normalizes store long volume

John Baumgartner

on the newer which the of for deli Great. Okay. is you Hain. just the to of acquisition, that a sort touch ParmCrisps part into store, And area gets

So this ideas you here? what for -- Thank these contributing the your Mark, to forward? opportunities? you. do for and from you business speak distribution your can EBITDA innovation? brand How Any for plans the can is for And of contribution you the think two the do the then see you about how brands going business to that duration year? also, assumption snacks What

Mark Schiller


be So going part the costs. nominal starting pricing middle pricing They the haven't all that for with in the they second half through and were want of contribution The because process EBITDA offset to of to is to of these pretty going didn't the second question. yet take a taken process.

conversation so kind and just pricing the we'll the significant taking of first we you and second the half retailer through we're plan, increase, the And going bought want projects in get also year. think the to don't we to of that be Obviously, the get with half business have second some to will we So a we it to year. XXXX but to price this projects nominally we're business, synergy need will F as place. in we average the be that get but will get that of -- EBITDA productivity contribute your

It And ParmCrisps about early, the other up very It's and these with they're have distribution opportunities household high drive versus as this the snack into call are this topper growth of some with On croutons. penetration hand off competitively not pretty us growth. go ago. the too it, The opportunities they innovation huge identified lot new I'm excited we to for salad start we momentum. segments also snacks, The up. very which is additional replacement of a is in really the have There's year food well. to as is the X.X look to a a distribution already to service XX% that segments. don't that. going they opportunities. into tip top great innovation ideas got will gets want line, -- because significant product They is It's got that that mix, launched we're one innovation but in just that in We've also Hain my They're there's wanted on at. cheese-based got strategy or because I business.

are and So our forward. are where we're going given footprint it's And distribution terms we differentiated to customer terrific them said strategy when and innovation opportunities the of the we high those kind and core in you on that a think the protein across And we carb. ParmCrisps. really low distribution ParmCrisps, calling that I about for think with our to much X.X of would is journey bigger we because very just snack and help drive, exactly very the a are going can have add, things expansion. customers, resources board relationships

snacks other protein beef sugar even example, lower higher carbs, much high-protein protein. versus much So and lower an it and turkey, same snacks, as like amount versus and it's in savory other has higher the or will, if bars much you but

[ph], cookies the So no it's palm our of positioned purchase. we non-GMO. fructose part of sero little high oils, time. well that isn't met. smaller. kind terrific very thrust On but which that become of need sensors brand. bigger consumer -- meeting no with much but not category really much in over corn It's nascent volumes a think for again, this a the ParmCrisps, this bodes of it's in well Most to acquisition, It's And the

our really attention. as opposed of We're our ParmCrisps with is And to so brands our we or upside. brands. manage growth see the putting fuel more and But we're resources most going where likely that to

John Baumgartner

Great. it. Thanks. Appreciate

Mark Schiller



of comes Our Group. Vendetti the proceed with Please from with next question. Maxim your question line Anthony

Anthony Vendetti

-- of obviously, of level hitting out? we going this able to this chain just sort across are of to forward? start at And you've of with been an terms point? push supply see that? and -- increases. It's they're them Yes. take Thanks. your issue. we're expectation And at going or Are time abate costs, able you think you Do you price to what's -- getting to know been Is to your all least they any Mark, I in this be you at dealing where inflation. Do continue you've the then pushback point peak

Mark Schiller


on haven't other So job kind done we a pricing, of have good utilized very there pricing, are fully levers of we yet. pricing offsetting with our but cost that

for of few we point frequency right? at But trade and So at we're looking has a pricing price depth get promotion, this list of also ounces that another fill way And out, to as to P&L pricing way certainly, of encouraging that's also the spending, looking outs, list if keep both and certainly the that's out middle the costs to of increases. also get been be you some price side. and up could most beneficial then cost customers Because a our we're are take at the trucks, in. weight of the us same on the can

on challenges, for impacts a everyone. things, United aren't the food labor with right both worldwide shortages Europe States, which and able So there's fully chain which It's that on pouches. because warehousing baby example, inventory. there's the business I the as come just we're to affecting pouches things output And like side, pricing in an but don't the ways. There's job as in going good chain, inability we're is We've it's supply got control inbound said ingredients. on we having where to think and a there we doing globally, in that's our supply there opportunity, demand factories, is most previous I've the ship. things more And now, our shortage is well to which of keep any that We're and with. really control, staffed. is as in the calls, up The the distribution different

So those showing we very docs product price to find pick the notice make door. driving customers kinds us trucks that out not and to to them a and our of require things can are Those costs. up the our at ship the short to the clear are those that orders get up -- things things, something premium sure which on are

that we of chain, the we've supply is, throughout shortages, find get as to last to and think shortages see I as labor abate, been I global the fourth we labor to supply of think now, challenges backup fourth that is continue quarter, that facing. really driven by kind of start will the started our a quarter this react The right year. those is can all to do we shortages. sources lap not lot normalize, but news labor it but things we of And good

of one year. quarter elevation fourth have elevated kind costs. of of of in relatively we their been stable So quarter since last They've more terms

And of into we'll it be and as next as ingredient come about I we to lap costs those start of the into conversation get as So fourth a think incrementality some we the costs quarter of this, will abate normalize, the less down year. costs. of some these things hopefully, and see

Anthony Vendetti

this at that expense require a but Hain, just could you outsource of is that only you at know whether said, anything doesn't quick these this else And costs, could quarter? quarter Okay. do I one today. some out Is of ride capital there everything you normalize, somewhat can more that you too starting concerns infrastructure, you should with a help elevated like much that, anything alleviate it's point, and there fiscal your of or -- follow-up investments shipping think maybe in basically, fourth

Mark Schiller


not certainly we're So resting.

increasing the of disruption. cost, hope because, So it regard all automating trying out to it's even issues things had aggressively to the and We're kind on things our labor need to levels fill we've though jobs the for our in are also our is open again, some good stabilize, plants, that where service take alleviates with and inventory of these supply. we

disruptions from and disruptions, go but things that of else's ourselves in So and predict factory somebody protect crops. in further we're on to try mitigate terms hard to it's doing or

can can quickly things we're seen. reacting of we're kind And do that that with the challenges the internally so we that we've things see to responding to we some of mitigate and

the to would down that bottlenecks. marketplace, our of can And so continues the again, to will come a alleviate hit and bit as productivity as we those come expect we some costs that, fruition,

Anthony Vendetti

Excellent. for Thanks update. that


proceed with Our next from with question Alexia your line Howard of question. comes the Please Bernstein.

Alexia Howard

Good morning, everyone.

Mark Schiller

Alexia. morning, Good

Alexia Howard


the So first side. on sales all, focus of

food quarter. growth shortfall? you forward was must guess, negative of you once then the growth channels. have Where channel to growth measured Brexit You stocking going Because the that I saw Europe, And very China saw this are measured up X% strong phenomenon? happened this and that lapped baby the America, but in improve around that the in North expecting time, the we've it was been, outside

Mark Schiller


So run. couple example. the we on. basis, had of up short a XX% is last gap between shipments while an shifting still two-year really the Remember by is and year consumption that And growth in massive as e-commerce one, going been in things. Number it's there America a channel it's negative in North driven on

is is, Now our be quarter of part has news been e-commerce second it, trends than first better good the quarter again, seems it difference. were to trends, towards the that but our a in headwind moving and flat, back

And North years. in biggest still well of Canada, is That in We've been short-term sanitizer are from business one our the is plant-based that's and completed part some Canada, were a that's America slowdown in we success of Canada The also brands got overlapping. second publicized. the previous we there is is overlapping it, headwind. but now

gap last experienced And more the here a People to overlapping now the really between for allowed That's gone consumption. versus will and were those they are work US. I out they to not the is of the time, again, decision back long as that people of in much, is office. occasions and -- sick And down. it's are for a and immunity, significant store. we In where Brexit, the store have work what but the number life in -- as said, last our lockdowns complete go prolonged on supply would versus a the last of that Europe, as to go the much Omicron I the period the of going a have the much people a herd of have getting very significant means still of year, acceleration. the store severe and time difference normalized lockdowns Remember, by to that the bit but grocery left So of which we've gone on previously, Again, driven they've year. couple of normalize, were little between brands. had deaths and of they're that more that lower they which period a exit again, shipments expect the entire normalizes some made end people the consumption of kind that and to hospitalizations for had started left house of lockdown, QX, at grocery year, and back while kind the occasions in-home eating we had a to than led sales laps

just we So that have to lap another quarter. for

Alexia Howard

it and the Chris. Great. the to pass appreciate And I it. best new all role, with Javier, I’ll really welcome on.

Mark Schiller

you. Thank


proceed ISI. question comes Evercore your with from the Please line David of next Palmer question. with Our

David Palmer

not Thanks. Good also your timing, just just morning. And just be I as what check input in in about will with of and costs. margins but viewed wanted I'm light you costs long-term transitory COVID targets. gross pricing about thinking to

the having perhaps and we God for And thinking think you're just from the total as costs -- year of away. these maybe things, friction this willing, example, stick still go achieved can do around XXXX, past So the get is start that as era, these fiscal XX% about mid-XXs? longer-term gross about could and margins we and there in transitory you be friction in COVID think some we'll COVID much how pricing

So curious all commentary about that. on I'd be your

Mark Schiller


Hain lots and of X.X destination, time we've so the there. get a that strategy remember got XXXX to was So

encouraging line momentum, of in bodes what's our the journey. is, which particularly dramatically is think United consumption, for terms top I -- I well in has very think accelerated that States,

these plus pricing inflation transitory things. productivity in million $XXX million we've of $XX and had As another of we've I and prepared those remarks, would of said costs, got to the to million about I XX% offset call about what about $XX million $XX

on this had because pricing to we're assumed going go expect expect continue industry. to down. see and margins why that our that's time planned, some off, will when seen been us do so we're costs they've that rest not pretty the to expect which, inflation. again, volume would slightly, the you've encouraging we I don't And do relative solid of very while will we're to unit seeing is that. top over that that down I there that gross fall of growth stick I And these double-digit be we originally pricing the seeing

volume In fact, we're seeing accelerating.

And can our that think several will will pricing. come So obviously, planned And we we we on as this hold have down. assuming time, to happens, margins expect, is I all up, these go out costs years. that productivity still for over

on will we a we're see there, to environment that some need of optimistic right we to volatile now, order these I'm things margins but those see back very relief in in up. go So some get and

David Palmer

everything, of think what terms should traditional how would pricing these of situation tough you transitory obviously after of a have I'm pricing would ahead where costs, transitory mean we because non-transitory. pricing the sure what to in away. is your and for costs then really it's disentangle costs? costs pricing transitory but -- how like is input your Do covering about -- the versus your you transitory for feel go you're plus I you plan for be

Mark Schiller


productivity we're cover and our to the reinvest the to model productivity and inflation cover to X.X costs. has we've price is to the these we're Short model then term, -- to cover transitory and going brands use our used our bottom and going accelerate priced being line. So for to been is, inflation, in

the marketing transitory investing of all these we're not bottom in as taking and line because much we're as So much to costs.

as So over we'll expect to several this journey, as X.X into I next continue the years cover -- to again, inflation. price get we

but And to up costs our set EBITDA short opportunity the becomes significantly productivity. increase have term, so these transitory that that productivity growth,

David Palmer

Thank That’s helpful. you.


Our next with line question your comes Please with Seaport Eric Larson of question. Research. proceed from the

Eric Larson

aboard, to you, and welcome congratulations Javier, Thank everybody Chris. and Yes. you, and luck good

So two quick questions.

So consensus at million. now for estimates right if $XXX XXXX you look fiscal at EBITDA are where is for

of million. flat $XXX year, that's you're guiding year last so And sort this versus to

–d your the this costs adjustment seems all of wash to for way the energy like that going all puts of entire of to better a that out down of can we incremental kind Europe. just kind understand? So Is you to and million on here, of wash something fair this in EBITDA it takes is year guidance kind if the $XX

Mark Schiller

oversimplification, have Yes. the It's I core, do a pricing. costs, We said, its incremental bit decline. that little driving an but at as incremental what's we is have of do but

some costs. productivity incremental transitory of the covering that's have We

taking there's the simplest more guidance at and So lot a this $XX in down of puts takes and of yes, $XX environment, but level, million. we've cost its million got we're

-- are can I surprises puts but things there. a XX, basically surprises, tell at us explain about lot feet, there's There that million all the have And positive in certainly some out been would some takes more a so but and there water, those change. that XXX that underneath you, negative been it walks and things have $XX are to it

Eric Larson

again, simplify I'm trying best to, just the parts. see incremental to real change moving the was. of to lot a there's that Yes, it can Yes. what we are

second $XXX taken this million question you've So the got already pricing is, of year.

going product this? maybe opportunities of this, is maintain that goods increases than or that. a So at simplification billion actually price your competitive base, that's the use revenue through X%. how to forward to price looking and that just to great simple as It I'm more again, by are little a a over -- price $X higher seems your much trying productivity Are be some try other competitiveness companies of use packaged you to

Mark Schiller

a cost, as so Well, of we look a percentage our revenue. our percentage at pricing not as of

most percentage significantly if you'd XX weeks, than said. in see that data, it's up that's of the about our round as X%, at look we're recent take you the second So X% -- we And a pricing. you the we're costs, that retail and higher of the before

dramatically. said, aren't of getting to day, by gaps category our So sure a been about our XX% competitors took seeing we Baby And wider takes cases way that's have I you're thought, where fall increase. and but some And comment. in what, would sure it's this velocities on XX% velocities make And before do like where good price meant the by you up retail. pricing we're in where pricing off, make some we going haven't picked expect, we it's you'll and any velocity, would double-digit so that, aren't in than the we've taken to increases, a our planned, as that to picking increase going end detail other great by pricing units analyze and better at taken velocity I up but actually as that at there's my make significant then adjustments. retail and yet cases, And the of our despite know have see segment, puts balance, at see of the day. and all example It's what about I to exactly end be we're planned, dropping. we going not

Eric Larson

it. Got

question. real more One Thanks. quick Okay.

I lot a price like your that fair second it $XX XX. Is at like the a you at you observation? If would quarter, an average stock price in of assume

Mark Schiller

it's at to divulge. if not but in to stock strategy of conclusion going what the we the that mid-XXs. to value, the See, we to be as like like say price a We in mid-XXs, certainly it I our consider fair the am got internal stock relative we

Eric Larson

Thank you, it. everybody. Appreciate


from Rebecca Scheuneman question. of proceed line with question Our next with Please comes Morningstar. the your

Rebecca Scheuneman

question. for thanks and the morning Good

a kind start I'd to with think staffing provide on I if could So levels. you little update like the of

new And in update warehouse retail still staffing, to of staffed, like that products. what your some ability had mentioned believe but been provide have if also there warehouse. quarter, your a might it's little in customers that the have but at the you there. you were you're shortages You are a could could I me give to manufacturing last, said and there returned full fully plants, picture launch and impairing shortages just the

Mark Schiller


kind So factories, of us plant exception has very with of a last perpetual and spring, we're the is turnover pretty within staffed for our fully challenge our been low. since that one

plants do did were have that. challenges and it's about very And competitive the previously, And it of a we And challenges plant. six snack of great so before plant, considerably. months that consolidation up we hit. Europe, feel don't where one more one into We two gone we we marketplace have labor that out wages some challenges. right while still sure, we a I've said we for different getting are do one have have than output ago in labor plant much labor In

they an pick bit, ingredient driver. couldn't but world they're having the everybody be though the even be and It labor industries. customers It of suppliers, With cases a has time some And we that that's it with is a an increased a back doesn't order labor be level high challenges, short they've up they their their and and that moved that's arrive in a and to days as where to take among disrupting be And split to therefore, show get on work. challenges long-term to be the output We doesn't issue. people, up can absenteeism is co-man we rest that It that's retailers haven't disruptions it could at people have back. because truck volume We're are regard seeing don't that may was XX challenges come have XX COVID for again, in. come because could supposed seeing to and previously. who not they challenges. seeing even has the customer COVID five coming going -- production out our whether are or the that little just a expect other as and of industry term,

a a we're pick think to the supply, increases So labor things we externally. these up backup cost finding our the because the levels us are because, and air so finding prepared giving get come are are average as materials, less levels the my and $XX said for I are we're above million -- facing, offset, we're good doing doing got with And and that that service really to in dropped $XX industry. that transitory far, if control driving that job our million best that weren't if we I They're sources of, distribution. our customers things and good of wasn't remarks, doing that a to other service Those said internally, people we've I to more be order extra good. all freight that know Again, can of customer again, and truck programs offering a out merchandising wouldn't have they able those cost truck. before,

doing eat the to those to that's find and be we So And may pretty costs at of company, while priority it's end us term, and the for because service to adding a day, good a productivity growth of it. customer to keeping the a cost, we supplier. reliable have have be we're short job the offset


line Capital. question your next Please question. Scott with the Mushkin from proceed Our comes with of RX

Scott Mushkin

guys. for Hey, Thanks question. my taking

gotten Europe earlier normal, more. said eating more that to out you have people about So back

the you yourself, maybe process, thought get get performs maybe in half to second maybe the competition we is, seeing we're the the some we calendar our and and price So ramp-up and asking this cycle even price we vis-à-vis from to start increases that promotions for cycle, through the but also of How things a volume do clients as and think if business XXXX see decreases. retailers hiccups.

Mark Schiller

consumer, of XXX% I as that. competitors of just and out going to people we're the people back where I the back very time, another going at consumer to recently, see There, all pendulum in, and things as swung obviously home, we're to expect, here will is a unlike we -- another half the a XX the consumer accept pointed are We're the study way kind or If here. But going left so the was the of watch working keep office bag some saw to bit the out, going while the increases, then that right? then XX% of the lap think prices, half XX% mixed be percent to down are are home. we there. trading responsive a are to willing a the all it is they are kind to little the of If way to increases to you people their right. normalize lowering it to do It's swung to in have And I work. start that

overlapping the a period home. that So lockdowns are we complete driving time occasions of out are of for

going as working gaps do have, do As do expect less down. that closely prices is the that I or as of people of We've certain inflation And normalizes trade who than kind we're volume what where where have just to pricing got more when environment watch and the see people so these in that to get team, job exceptionally retail really within data expect double-digit leaders, and just we've and does normalize I in have done here watching to haven't materializes, leader, we robust Europe everybody that that we'll grocery moved share both that to be are lead have it other the the you got good that, terms closely. lap stay inflation, a behavior, not to consumer categories to that things very of and store. so or watching will we down. categories within are we'll And and we to far promotional marketplace that follow consumers that that we but in moved of in see brands. responding a we and in And don't may we will where our we've the prices certainly people are

on it. we're some would than XXXX, we're So yes, soon. challenges we to overlapping going We're been things because now get but it, those watching pretty these better certainly as into I be having F to of challenges going we've expect normalize are the


hand questions. for Schiller over remarks. have we back time for to the the all Mr. closing to I'd like is That call

Mark Schiller

incredibly very Obviously, in interest a we're seeing the by guys all that today. United to X.X said journey. I consumption thank Hain missing States. it's line That fact one been that our accelerating, We was your as been that's in set the for it's top line top in encouraged in of you've momentum about. proof growth excited heard the everyone. you challenging I'm we're environment, up very X.X, and the points has that from

again, one-on-one all forward So you today. calls I your look for the interest. And thank to later


does you teleconference. gentlemen, Ladies this your conclude for and Thank today's participation.

day. disconnect and time, may have a your You this wonderful at lines