PR Newswire | Nov 9, 2021 06:31AM EST

11/09 05:30 CST

Hain Celestial Reports First Quarter Fiscal Year 2022 Financial ResultsBetter than Expected First Quarter Net Sales of $454.9 million versus Previous GuidanceFirst Quarter GAAP EPS of $0.20 and Adjusted EPS of $0.25Company Reaffirms Full Fiscal Year 2022 Guidance LAKE SUCCESS, N.Y., Nov. 9, 2021

LAKE SUCCESS, N.Y., Nov. 9, 2021 /PRNewswire/ -- The Hain Celestial Group, Inc. (Nasdaq: HAIN) ("Hain Celestial", "Hain" or the "Company"), a leading organic and natural products company with operations in North America, Europe, Asia and the Middle East providing consumers with A Healthier Way of Life(r), today reported financial results for the first quarter ended September 30, 2021.

Mark L. Schiller, Hain Celestial's President and Chief Executive Officer, commented, "We are pleased to have delivered better top line and bottom line first quarter performance than our guidance as we navigated a challenging operating environment affected by industry-wide inflation and labor challenges. In September, we held our Investor Day, during which we shared our Hain 3.0 vision and strategy for the next several years at Hain, focused on building a global healthy food and beverage company with industry-leading top line growth. We believe that we are well positioned for the future, and we expect another strong year as we continue to create shareholder value."

FINANCIAL HIGHLIGHTS*

Summary of First Quarter Results from Continuing Operations

* Net sales decreased 9% to $454.9 million, or 11% on a constant currency basis, compared to the prior year period. * When adjusted for foreign exchange, divestitures and discontinued brands, net sales were flat compared to the prior year period. * Gross margin of 23.2%, a 72 basis point decrease from the prior year period. * Adjusted gross margin of 23.9%, a 24 basis point decrease from the prior year period. * Operating income of $25.5 million compared $3.3 million in the prior year period. * Adjusted operating income of $34.3 million compared to $38.8 million in the prior year period. * Net income of $19.4 million compared to a net loss of $10.8 million in the prior year period. * Adjusted net income of $23.8 million compared to $27.4 million in prior year period. * Adjusted EBITDA of $47.3 million compared to $54.9 million in the prior year period. * Adjusted EBITDA margin of 10.4%, a 61 basis point decrease compared to the prior year period. * Earnings per diluted share ("EPS") of $0.20 compared to a loss of $0.11 in the prior year period. * Adjusted EPS of $0.25 compared to $0.27 in the prior year period. * Repurchased 4.5 million shares, or 4.6% of the outstanding common stock, at an average price of $38.80 per share.

SEGMENT HIGHLIGHTS FROM CONTINUING OPERATIONS

The Company operates under two reportable segments: North America and International.

North AmericaNorth America net sales in the first quarter were $265.5 million, a decrease of 5% compared to the prior year period. When adjusted for foreign exchange, divestitures and discontinued brands, net sales decreased 1% from the prior year period.

Segment gross profit in the first quarter was $56.8 million, a 24% decrease from the prior year period. Adjusted gross profit was $59.2 million, a decrease of 22% from the prior year period. Gross margin was 21.4%, a 533 basis point decrease from the prior year period, and adjusted gross margin was 22.3%, a 476 basis point decrease from the prior year period.

Segment operating income in the first quarter was $16.8 million, a 49% decrease from the prior year period. Adjusted operating income was $20.5 million, a 41% decrease from the prior year period.

Adjusted EBITDA in the first quarter was $24.1 million, a 38% decrease from the prior year period. As a percentage of sales, North America adjusted EBITDA margin was 9.1%, a 486 basis point decrease from the prior year period.

InternationalInternational net sales in the first quarter were $189.4 million, a decrease of 13% compared to the prior year period. When adjusted for foreign exchange, divestitures and discontinued brands, net sales increased 2% compared to the prior year period.

Segment gross profit in the first quarter was $48.6 million, a 10% increase from the prior year period. Adjusted gross profit was $49.5 million, an increase of 11% from the prior year period. Gross margin was 25.7%, a 541 basis point increase from the prior year period, and adjusted gross margin was 26.1%, a 576 basis point increase from the prior year period.

Segment operating income in the first quarter was $24.1 million, compared to a loss of $15.9 million in the prior year period. Adjusted operating income was $25.2 million, an increase of 46% from the prior year period.

Adjusted EBITDA in the first quarter was $32.4 million, a 21% increase from the prior year period. As a percentage of sales, International adjusted EBITDA margin was 17.1%, a 487 basis point increase from the prior year period.

CAPITAL MANAGEMENT

As previously disclosed, the Board of Directors of the Company approved an additional $300 million share repurchase authorization in August 2021. Share repurchases under the 2021 authorization commenced in August 2021, after the 2017 authorization was fully utilized. The extent to which the Company repurchases its shares and the timing of such repurchases will be at the Company's discretion and will depend upon market conditions and other corporate considerations. Repurchases may be made from time to time in the open market, pursuant to pre-set trading plans, in private transactions or otherwise.

During the first quarter of fiscal year 2022, the Company repurchased 4.5 million shares, or 4.6% of the outstanding common stock, at an average price of $38.80 per share for a total of $175.6 million, excluding commissions. As of September 30, 2021, the Company had $206.8 million remaining under the 2021 authorization.

FISCAL YEAR 2022 GUIDANCE

For full fiscal year 2022, compared to fiscal year 2021, the Company continues to expect:

* Low single digit adjusted net sales growth, * Modest adjusted gross margin expansion, and * Mid to high single digit adjusted EBITDA growth.

Given the elevated demand during the first half of fiscal year 2021 from the COVID-19 pandemic, a highly inflationary current environment and the timing of the price increase, among other factors, the Company expects:

* Net sales to be down low single digit on an adjusted basis in the first half of fiscal year 2022 and up by mid to high single digit in the second half, and * Adjusted EBITDA to be down mid-single digit in the first half of fiscal year 2022 and up low double digits in the second half.

Notes: Adjusted net sales is defined as adjusted for the impact of foreign currency changes, divestitures and discontinued brands. All references in this "Fiscal Year 2022 Guidance" section to growth or declines in adjusted net sales or adjusted EBITDA compared to a prior period represent percentage growth or percentage decline.

Conference Call and Webcast InformationHain Celestial will host a conference call and webcast today at 8:00 AM Eastern Time to discuss its results and business outlook. Investors interested in participating in the live call can dial 855-327-6837 from the U.S. and 631-891-4304 internationally. The call will be webcast and the accompanying presentation will be available under the Investor Relations section of the Company's website at www.hain.com.

About The Hain Celestial Group, Inc.The Hain Celestial Group (Nasdaq: HAIN), headquartered in Lake Success, NY, is a leading organic and natural products company with operations in North America, Europe, Asia and the Middle East. Hain Celestial participates in many natural categories with well-known brands that include Celestial Seasonings(r), Clarks(tm), Cully & Sully(r), Earth's Best(r), Ella's Kitchen(r), Frank Cooper's(r), Gale's(r), Garden of Eatin'(r), Hain Pure Foods(r), Hartley's(r), Health Valley(r), Imagine(r), Joya(r), Lima(r), Linda McCartney's(r) (under license), MaraNatha(r), Natumi(r), New Covent Garden Soup Co.(r), Robertson's(r), Rose's(r) (under license), Sensible Portions(r), Spectrum(r), Sun-Pat(r), Terra(r), The Greek Gods(r), Yorkshire Provender(r) and Yves Veggie Cuisine(r). The Company's personal care products are marketed under the Alba Botanica(r), Avalon Organics(r), JASON(r), Live Clean(r) and Queen Helene(r) brands.

Forward-Looking StatementsThis press release contains forward-looking statements within the meaning of safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve risks, uncertainties and assumptions. If the risks or uncertainties ever materialize or the assumptions prove incorrect, our results may differ materially from those expressed or implied by such forward-looking statements. The words "believe," "expect," "anticipate," "may," "should," "plan," "intend," "potential," "will" and similar expressions are intended to identify such forward-looking statements. Forward-looking statements include, among other things, our beliefs or expectations relating to our future performance, results of operations and financial condition; our strategic initiatives, business strategy, supply chain, brand portfolio and product performance; the COVID-19 pandemic; current or future macroeconomic trends; and future corporate acquisitions or dispositions.

Risks and uncertainties that may cause actual results to differ materially from forward-looking statements include: challenges and uncertainty resulting from the impact of competition; challenges and uncertainty resulting from the COVID-19 pandemic; our ability to manage our supply chain effectively; disruption of operations at our manufacturing facilities; reliance on independent contract manufacturers; changes to consumer preferences; customer concentration; reliance on independent distributors; the availability of organic ingredients; risks associated with our international sales and operations; risks associated with outsourcing arrangements; our ability to execute our cost reduction initiatives and related strategic initiatives; our reliance on independent certification for a number of our products; the reputation of our Company and our brands; our ability to use and protect trademarks; general economic conditions; input cost inflation; the United Kingdom's exit from the European Union; cybersecurity incidents; disruptions to information technology systems; the impact of climate change; liabilities, claims or regulatory change with respect to environmental matters; potential liability if our products cause illness or physical harm; the highly regulated environment in which we operate; pending and future litigation; compliance with data privacy laws; compliance with our credit agreement; the discontinuation of LIBOR; concentration in the ownership of our common stock; our ability to issue preferred stock; the adequacy of our insurance coverage; impairments in the carrying value of goodwill or other intangible assets; and other risks and matters described in our most recent Annual Report on Form 10-K and our other filings from time to time with the U.S. Securities and Exchange Commission.

We undertake no obligation to update forward-looking statements to reflect actual results or changes in assumptions or circumstances, except as required by applicable law.

Non-GAAP Financial MeasuresThis press release and the accompanying tables include non-GAAP financial measures, including, among others, adjusted operating income and its related margin, adjusted gross profit and its related margin, adjusted net income, adjusted earnings per diluted share, net sales adjusted for the impact of foreign exchange, divestitures and discontinued brands, adjusted EBITDA and its related margin and operating free cash flow. The reconciliations of these non-GAAP financial measures to the comparable GAAP financial measures are provided herein in the tables. Management believes that the non-GAAP financial measures presented provide useful additional information to investors about current trends in the Company's operations and are useful for period-over-period comparisons of operations. These non-GAAP financial measures should not be considered in isolation or as a substitute for the comparable GAAP measures. In addition, these non-GAAP measures may not be the same as similar measures provided by other companies due to potential differences in methods of calculation and items being excluded. They should be read only in connection with the Company's Consolidated Statements of Operations and Cash Flows presented in accordance with GAAP.

Certain forward-looking non-GAAP financial measures included in this press release are not reconciled to the comparable forward-looking GAAP financial measures. The Company is not able to reconcile these forward-looking non-GAAP financial measures to their most directly comparable forward-looking GAAP financial measures without unreasonable efforts because the Company is unable to predict with a reasonable degree of certainty the type and extent of certain items that would be expected to impact GAAP measures but would not impact the non-GAAP measures. Such items may include litigation and related expenses, transaction costs associated with acquisitions and divestitures, productivity and transformation costs, impairments, gains or losses on sales of assets and businesses, foreign exchange movements and other items. The unavailable information could have a significant impact on the Company's GAAP financial results.

The Company believes presenting net sales at constant currency provides useful information to investors because it provides transparency to underlying performance in the Company's consolidated net sales by excluding the effect that foreign currency exchange rate fluctuations have on period-to-period comparability given the volatility in foreign currency exchange markets. To present this information for historical periods, current period net sales for entities reporting in currencies other than the U.S. dollar are translated into U.S. dollars at the average monthly exchange rates in effect during the corresponding period of the prior fiscal year, rather than at the actual average monthly exchange rate in effect during the current period of the current fiscal year. As a result, the foreign currency impact is equal to the current year results in local currencies multiplied by the change in average foreign currency exchange rate between the current fiscal period and the corresponding period of the prior fiscal year.

The Company provides net sales adjusted for the impact of foreign currency, divestitures and discontinued brands to understand the growth rate of net sales excluding the impact of such items. The Company's management believes net sales adjusted for such items is useful to investors because it enables them to better understand the growth of our business from period-to-period.

The Company defines adjusted EBITDA as net income (loss) before income taxes, net interest expense, depreciation and amortization, equity in net loss of equity-method investees, stock-based compensation, unrealized currency gains and losses, transaction costs associated with acquisitions and divestitures, productivity and transformation costs, proceeds from an insurance claim, impairment of long-lived assets, warehouse and manufacturing consolidation and other costs, gains or losses on sales of assets and businesses, litigation and related expenses, plant closure related costs, inventory write-downs and other adjustments. The Company's management believes that these presentations provide useful information to management, analysts and investors regarding certain additional financial and business trends relating to its results of operations and financial condition. In addition, management uses these measures for reviewing the financial results of the Company as well as a component of performance-based executive compensation.

The Company defines operating free cash flow as cash provided by or used in operating activities from continuing operations (a GAAP measure) less purchases of property, plant and equipment. The Company views operating free cash flow as an important measure because it is one factor in evaluating the amount of cash available for discretionary investments.

_________________________

* Notes:

The results contained in this press release are presented with the Tilda(1) operating segment being treated as discontinued operations. Unless otherwise noted, all results included in this press release are from continuing operations.

This press release includes certain non-GAAP financial measures, which are intended to supplement, not substitute for, comparable GAAP financial(2) measures. Reconciliations of non-GAAP financial measures to GAAP financial measures and other non-GAAP financial calculations are provided in the tables included in this press release.

THE HAIN CELESTIAL GROUP, INC.

Consolidated Balance Sheets

(unaudited and in thousands)

September 30, 2021 June 30, 2021

ASSETS

Current assets:

Cash and cash equivalents $ 28,962 $ 75,871

Accounts receivable, net 181,048 174,066

Inventories 280,176 285,410

Prepaid expenses and other current assets 38,496 39,834

Assets held for sale 3,642 1,874

Total current assets 532,324 577,055

Property, plant and equipment, net 312,426 312,777

Goodwill 863,348 871,067

Trademarks and other intangible assets, net 308,588 314,895

Investments and joint ventures 16,718 16,917

Operating lease right-of-use assets, net 88,387 92,010

Other assets 20,474 21,187

Total assets $ 2,142,265 $ 2,205,908

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Accounts payable $ 172,733 $ 171,947

Accrued expenses and other current liabilities 123,296 117,957

Current portion of long-term debt 335 530

Total current liabilities 296,364 290,434

Long-term debt, less current portion 345,414 230,492

Deferred income taxes 40,345 42,639

Operating lease liabilities, noncurrent portion 82,176 85,929

Other noncurrent liabilities 29,210 33,531

Total liabilities 793,509 683,025

Total stockholders' equity 1,348,756 1,522,883

Total liabilities and stockholders' equity $ 2,142,265 $ 2,205,908

THE HAIN CELESTIAL GROUP, INC.

Consolidated Statements of Operations

(unaudited and in thousands, except per share amounts)

First Quarter

2022 2021

Net sales $ 454,903 $ 498,627

Cost of sales 349,485 379,463

Gross profit 105,418 119,164

Selling, general and administrative expenses 73,989 79,521

Amortization of acquired intangible assets 2,095 2,433

Productivity and transformation costs 3,983 1,433

Proceeds from insurance claim (196) -

Long-lived asset impairment - 32,497

Operating income 25,547 3,280

Interest and other financing expense, net 1,856 2,453

Other income, net (788) (1,373)

Income from continuing operations before income taxes and equity in 24,479 2,200net loss of equity-method investees

Provision for income taxes 4,542 12,962

Equity in net loss of equity-method investees 526 19

Net income (loss) from continuing operations $ 19,411 $ (10,781)

Net income from discontinued operations, net of tax - 11,266

Net income $ 19,411 $ 485

Net income (loss) per common share:

Basic net income (loss) per common share from continuing operations $ 0.20 $ (0.11)

Basic net income per common share from discontinued operations - 0.11

Basic net income per common share $ 0.20 $ -

Diluted net income (loss) per common share from continuing operations $ 0.20 $ (0.11)

Diluted net income per common share from discontinued operations - 0.11

Diluted net income per common share $ 0.20 $ -

Shares used in the calculation of net income (loss) per common share:

Basic 97,121 101,558

Diluted 97,438 101,558

THE HAIN CELESTIAL GROUP, INC.

Consolidated Statements of Cash Flows

(unaudited and in thousands)

First Quarter

2022 2021

CASH FLOWS FROM OPERATING ACTIVITIES

Net income $ 19,411 $ 485

Net income from discontinued operations, net of tax - 11,266

Net income (loss) from continuing operations 19,411 (10,781)

Adjustments to reconcile net income (loss) from continuing operations to netcash provided by operating activities from continuing operations:

Depreciation and amortization 10,855 13,761

Deferred income taxes (2,105) (930)

Equity in net loss of equity-method investees 526 19

Stock-based compensation 4,287 4,367

Long-lived asset impairment - 32,497

Gain on sale of assets (276) -

Gain on sale of businesses - (620)

Other non-cash items, net (1,093) (1,047)

(Decrease) increase in cash attributable to changes in operating assets andliabilities:

Accounts receivable (9,443) (3,575)

Inventories 2,277 (44,962)

Other current assets 900 37,869

Other assets and liabilities (1,566) (1,541)

Accounts payable and accrued expenses 13,813 15,612

Net cash provided by operating activities from continuing operations 37,586 40,669

CASH FLOWS FROM INVESTING ACTIVITIES

Purchases of property, plant and equipment (17,810) (12,155)

Investment in joint venture (408) -

Proceeds from sale of assets 164 -

Proceeds from sale of businesses, net and other - 4,427

Net cash used in investing activities from continuing operations (18,054) (7,728)

CASH FLOWS FROM FINANCING ACTIVITIES

Borrowings under bank revolving credit facility 120,000 55,000

Repayments under bank revolving credit facility (5,000) (47,000)

Repayments of other debt, net (237) (1,439)

Share repurchases (177,103) (42,052)

Shares withheld for payment of employee payroll taxes (1,175) (468)

Net cash used in financing activities from continuing operations (63,515) (35,959)

Effect of exchange rate changes on cash from continuing operations (2,926) 2,500

Net decrease in cash and cash equivalents (46,909) (518)

Cash and cash equivalents at beginning of period 75,871 37,771

Cash and cash equivalents at end of period $ 28,962 $ 37,253

THE HAIN CELESTIAL GROUP, INC.

Net Sales, Gross Profit and Operating Income (Loss) by Segment

(unaudited and in thousands)

North America International Corporate/Other Hain Consolidated

Net Sales

Net sales - Q1 FY22 $ 265,525 $ 189,378 $ - $ 454,903

Net sales - Q1 FY21 $ 280,668 $ 217,959 $ - $ 498,627

% change - FY22 net sales vs. FY21 net sales (5.4)% (13.1)% (8.8)%

Gross Profit

Q1 FY22

Gross profit $ 56,809 $ 48,609 $ - $ 105,418

Non-GAAP adjustments^(1) 2,410 875 - 3,285

Adjusted gross profit $ 59,219 $ 49,484 $ - $ 108,703

Gross margin 21.4% 25.7% 23.2%

Adjusted gross margin 22.3% 26.1% 23.9%

Q1 FY21

Gross profit $ 75,015 $ 44,149 $ - $ 119,164

Non-GAAP adjustments^(1) 933 240 - 1,173

Adjusted gross profit $ 75,948 $ 44,389 $ - $ 120,337

Gross margin 26.7% 20.3% 23.9%

Adjusted gross margin 27.1% 20.4% 24.1%

Operating income (loss)

Q1 FY22

Operating income (loss) $ 16,842 $ 24,069 $ (15,364) $ 25,547

Non-GAAP adjustments^(1) 3,695 1,176 3,926 8,797

Adjusted operating income (loss) $ 20,537 $ 25,245 $ (11,438) $ 34,344

Operating income margin 6.3% 12.7% 5.6%

Adjusted operating income margin 7.7% 13.3% 7.5%

Q1 FY21

Operating income (loss) $ 33,256 $ (15,889) $ (14,087) $ 3,280

Non-GAAP adjustments^(1) 1,488 33,194 805 35,487

Adjusted operating income (loss) $ 34,744 $ 17,305 $ (13,282) $ 38,767

Operating income (loss) margin 11.8% (7.3)% 0.7%

Adjusted operating income margin 12.4% 7.9% 7.8%

^(1)See accompanying table "Adjusted Gross Profit, Adjusted Operating Income,Adjusted Net Income and Adjusted EPS"

THE HAIN CELESTIAL GROUP, INC.

Adjusted Gross Profit, Adjusted Operating Income, Adjusted Net Income andAdjusted EPS

(unaudited and in thousands, except per share amounts)

First Quarter

2022 GAAP Adjustments 2022 Adjusted 2021 GAAP Adjustments 2021 Adjusted

Net sales $ 454,903 $ - $ 454,903 $ 498,627 $ - $ 498,627

Cost of sales 349,485 (3,285) 346,200 379,463 (1,173) 378,290

Gross profit 105,418 3,285 108,703 119,164 1,173 120,337

Operating expenses^(a) 76,084 (1,725) 74,359 114,451 (32,881) 81,570

Productivity and transformation costs 3,983 (3,983) - 1,433 (1,433) -

Proceeds from insurance claim (196) 196 - - - -

Operating income 25,547 8,797 34,344 3,280 35,487 38,767

Interest and other expense (income), net^(b) 1,068 1,469 2,537 1,080 1,822 2,902

Provision (benefit) for income taxes 4,542 2,910 7,452 12,962 (4,562) 8,400

Net income (loss) from continuing operations 19,411 4,418 23,829 (10,781) 38,227 27,446

Net income (loss) from discontinued operations, net of tax - - - 11,266 (11,266) -

Net income 19,411 4,418 23,829 485 26,961 27,446

Diluted net income (loss) per common share from continuing operations 0.20 0.05 0.25 (0.11) 0.38 0.27

Diluted net income (loss) per common share from discontinued operations - - - 0.11 (0.11) -

Diluted net income per common share 0.20 0.05 0.25 - 0.27 0.27

Detail of Adjustments:

Q1 FY22 Q1 FY21

Inventory write-down $ - $ 204

Plant closure related costs 996 579

Warehouse/manufacturing consolidation and other costs 2,289 390

Cost of sales 3,285 1,173

Gross profit 3,285 1,173

Acquisitions & divestitures transaction costs, net (231) 369

Litigation expenses 1,956 -

Long-lived asset impairment - 32,497

Plant closure related costs - 15

Operating expenses^(a) 1,725 32,881

Productivity and transformation costs 3,983 1,433

Productivity and transformation costs 3,983 1,433

Proceeds from insurance claim (196) -

Proceeds from insurance claim (196) -

Operating income 8,797 35,487

Gain on sale of assets (446) -

Gain on sale of businesses - (620)

Unrealized currency gains (1,023) (1,202)

Interest and other expense (income), net^(b) (1,469) (1,822)

Income tax related adjustments (2,910) 4,562

(Benefit) provision for income taxes (2,910) 4,562

Net income from continuing operations $ 4,418 $ 38,227

^(a)Operating expenses include amortization of acquired intangibles, selling,general and administrative expenses and long-lived asset impairment.

^(b)Interest and other expense (income), net includes interest and otherfinancing expenses, net, unrealized currency gains, gain on sale of assets andbusinesses and other expense, net.

THE HAIN CELESTIAL GROUP, INC.

Adjusted Net Sales Growth

(unaudited and in thousands)

Q1 FY22 North America International Hain Consolidated

Net sales $ 265,525 $ 189,378 $ 454,903

Divestitures and discontinued brands (178) - (178)

Impact of foreign currency exchange (1,719) (8,269) (9,988)

Net sales on a constant currency basis adjusted for $ 263,628 $ 181,109 $ 444,737divestitures and discontinued brands

Q1 FY21

Net sales $ 280,668 $ 217,959 $ 498,627

Divestitures and discontinued brands (13,621) (39,630) (53,251)

Net sales adjusted for divestitures and discontinued brands $ 267,047 $ 178,329 $ 445,376

Net sales decline (5.4)% (13.1)% (8.8)%

Impact of divestitures and discontinued brands 4.7% 18.5% 10.7%

Impact of foreign currency exchange (0.6)% (3.8)% (2.0)%

Net sales (decline) growth on a constant currency basis (1.3)% 1.6% (0.1)%adjusted for divestitures and discontinued brands

THE HAIN CELESTIAL GROUP, INC.

Adjusted EBITDA

(unaudited and in thousands)

First Quarter

2022 2021

Net income $ 19,411 $ 485

Net income from discontinued operations, net of tax - 11,266

Net income (loss) from continuing operations $ 19,411 $ (10,781)

Depreciation and amortization 10,855 13,761

Equity in net loss of equity-method investees 526 19

Interest expense, net 1,146 2,154

Provision for income taxes 4,542 12,962

Stock-based compensation 4,287 4,367

Unrealized currency gains (1,023) (1,202)

Litigation & related costs

Litigation expenses 1,956 -

Proceeds from insurance claim (196) -

Restructuring activities

Plant closure related costs 996 (6)

Productivity and transformation costs 3,204 781

Warehouse/manufacturing consolidation and other costs 2,289 390

Acquisitions & divestitures

Acquisitions & divestitures transaction costs, net (231) 369

Gain on sale of assets (446) -

Gain on sale of businesses - (620)

Impairment charges

Inventory write-down - 204

Long-lived asset impairment - 32,497

Adjusted EBITDA $ 47,316 $ 54,895

THE HAIN CELESTIAL GROUP, INC.

Adjusted EBITDA and Adjusted EBITDA Margin by Segment

(unaudited and in thousands)

Q1 FY22 North America International Corporate/Other Hain Consolidated

Operating income (loss) $ 16,842 $ 24,069 $ (15,364) $ 25,547

Depreciation and amortization 3,742 6,410 703 10,855

Stock-based compensation 636 721 2,930 4,287

Acquisitions & divestitures transaction costs, net (341) - 110 (231)

Litigation expenses - - 1,956 1,956

Proceeds from insurance claim - - (196) (196)

Plant closure related costs 996 - - 996

Productivity and transformation costs 1,625 299 1,280 3,204

Warehouse/manufacturing consolidation and other costs 1,413 876 - 2,289

Other (811) 59 (639) (1,391)

Adjusted EBITDA $ 24,102 $ 32,434 $ (9,220) $ 47,316

Net sales $ 265,525 $ 189,378 $ 454,903

Adjusted EBITDA margin 9.1% 17.1% 10.4%

Q1 FY21 North America International Corporate/Other Hain Consolidated

Operating income (loss) $ 33,256 $ (15,889) $ (14,087) $ 3,280

Depreciation and amortization 4,145 8,862 754 13,761

Stock-based compensation 864 675 2,828 4,367

Acquisitions & divestitures transaction costs, net (51) 68 352 369

Plant closure related costs (57) 51 - (6)

Productivity and transformation costs 605 377 (201) 781

Warehouse/manufacturing consolidation and other costs 200 190 - 390

Inventory write-down 204 - - 204

Long-lived asset impairment (11) 32,508 - 32,497

Other (33) (138) (577) (748)

Adjusted EBITDA $ 39,122 $ 26,704 $ (10,931) $ 54,895

Net sales $ 280,668 $ 217,959 $ 498,627

Adjusted EBITDA margin 13.9% 12.3% 11.0%

THE HAIN CELESTIAL GROUP, INC.

Operating Free Cash Flow

(unaudited and in thousands)

First Quarter

2022 2021

Net cash provided by operating activities from continuing operations $ 37,586 $ 40,669

Purchases of property, plant and equipment (17,810) (12,155)

Operating free cash flow from continuing operations $ 19,776 $ 28,514

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SOURCE The Hain Celestial Group, Inc.