Core Viewpoint - Prestige Consumer Healthcare Inc. is set to release its fiscal 2025 fourth quarter and year-end earnings on May 8, 2025, before market opening, followed by a conference call at 8:30 a.m. ET to discuss the results [1]. Company Overview - Prestige Consumer Healthcare Inc. markets, sells, manufactures, and distributes a wide range of consumer healthcare products across the U.S., Canada, Australia, and other international markets [4]. - The company's diverse portfolio includes well-known brands such as Monistat®, Summer's Eve®, BC®, Goody's®, Clear Eyes®, TheraTears®, DenTek®, Dramamine®, Fleet®, Chloraseptic®, Luden's®, Compound W®, Little Remedies®, Boudreaux's Butt Paste®, Nix®, Debrox®, Gaviscon® in Canada, Hydralyte®, and the Fess® line of products in Australia [4].

Core Insights - Prestige Consumer Healthcare (PBH) is focused on brand building and portfolio expansion through strategic acquisitions, which is expected to drive growth in upcoming quarters [1][5] - The company has experienced a share price increase of 19.3% over the past year, outperforming the industry and S&P 500 [1] Company Overview - PBH has a market capitalization of $4.17 billion and reported an earnings surprise of 5.17% in the last quarter [2] - The earnings yield for PBH stands at 5.4%, significantly higher than the industry's 0.3% [2] Growth Drivers - The strength of PBH's diversified portfolio, which includes well-recognized consumer brands, has contributed to sales growth and long-term profitability, with core brands generating nearly 58.6% of total revenues in fiscal 2024 [3] - The gastrointestinal (GI) product category is a significant contributor, accounting for nearly 20% of North American sales, with brands like Dramamine, Fleet, and Gaviscon leading the category [4] - The company is also seeing growth in the e-commerce channel, reflecting a long-term trend towards online purchases [4] Strategic Acquisitions - PBH has expanded its brand portfolio through both organic growth and acquisitions, including the purchase of TheraTears and other over-the-counter brands from Akorn Operating Company LLC, as well as Hydralyte from Hydration Pharmaceuticals Trust [5] Financial Concerns - As of the end of the fiscal third quarter, PBH had a long-term debt of $996 million and cash and cash equivalents of $51 million, with a debt-to-capital ratio of 35.8% [7] - The company generated approximately 14.8% of its fiscal 2024 revenues from international business, making it susceptible to currency fluctuations [9] Earnings Estimates - The Zacks Consensus Estimate for PBH's fiscal 2025 earnings per share has increased by 0.4% to $4.52, with revenue estimates at $1.13 billion, reflecting a 0.5% increase from the previous year [10]

Core Viewpoint - Premium Brands Holdings Corporation has announced a bought-deal offering of $150 million in convertible unsecured subordinated debentures, with potential total gross proceeds of $172.5 million if the over-allotment option is exercised [1][2][3] Group 1: Offering Details - The company will issue $150,000,000 aggregate principal amount of convertible unsecured subordinated debentures at a price of $1,000 per debenture [1] - An over-allotment option allows underwriters to purchase an additional $22,500,000 in debentures, potentially raising total gross proceeds to $172,500,000 [1] - The closing of the offering is expected around March 19, 2025, subject to regulatory approvals [6] Group 2: Use of Proceeds - Net proceeds from the offering will be used to repay existing indebtedness under credit facilities, which will then be available for the redemption of the 4.65% debentures, future acquisitions, capital projects, and general corporate purposes [3] Group 3: Debenture Terms - The debentures will bear interest at 5.50% per annum, payable semi-annually, with a maturity date of March 31, 2030 [4] - Holders can convert the debentures into common shares at a conversion price of $126.15 per share, equating to 7.9271 shares for each $1,000 principal amount [5]

Financial Data and Key Metrics Changes - Net sales for Q3 2025 reached $290 million, an increase of nearly 3% year-over-year, exceeding forecasts [8][19] - Earnings per share (EPS) increased by 15% to a record $1.22, driven by strong sales growth and lower interest expenses [9][20] - Free cash flow for the first nine months was $184.9 million, up 5% year-over-year, with a full-year outlook of $240 million or more [27][32] Business Line Data and Key Metrics Changes - The GI category, which includes brands like Dramamine, Fleet, and Gaviscon, represents nearly one-fifth of North American sales, showing solid mid-single-digit growth over the last three years [11][16] - International segment sales grew approximately 8% excluding foreign exchange, with Hydralyte being a key contributor [19][63] - The Cough & Cold category saw a decline, expected to be flat to down slightly for the year, impacting overall sales [44][46] Market Data and Key Metrics Changes - E-commerce sales continued to show double-digit year-over-year growth, indicating a long-term trend towards higher online purchasing [22] - The North American segment experienced broad-based growth, with notable increases in the GI category brands, partially offset by lower Cough & Cold sales [19][21] Company Strategy and Development Direction - The company is focused on capital deployment options to enhance shareholder value, including opportunistic share repurchases and potential M&A activities [10][29] - Management anticipates revenue for fiscal 2025 to be between $1.128 billion and $1.132 billion, with an organic revenue growth forecast of approximately 1% [30][32] - The company is well-positioned to manage inflation and tariff changes due to its diversified supply base and strong market share [24][49] Management's Comments on Operating Environment and Future Outlook - Management noted heightened uncertainty in the business environment due to supply chain constraints and inflation, but remains optimistic about the company's performance [5][30] - The company expects to see gradual improvements in sales for Clear Eyes as production levels increase and additional suppliers are added [37][56] - Management expressed confidence in the business momentum heading into fiscal 2026, with record sales and EPS reported [41][72] Other Important Information - The company reduced its variable term loan debt balance to zero and improved its leverage ratio to 2.5x [10][28] - Advertising and marketing expenses were 14.1% of sales for the first nine months, with expectations for an increase in dollars compared to the prior year [25] Q&A Session Summary Question: Recovery expectations for Clear Eyes - Management indicated that production levels for Clear Eyes were in line with expectations, with sales slightly ahead due to timing differences [36] Question: Clarity on Q4 gross margin expectations - Management explained that the anticipated gross margin increase in Q4 is driven by the timing of cost-saving initiatives [39] Question: Inventory levels in the Cold & Cough category - Management noted that the Cold & Cough category is not a significant part of their portfolio, and they do not expect a substantial increase in reorder rates [44][46] Question: Exposure to tariffs - Management stated that while they monitor tariff implications, the majority of manufacturing is in the U.S., providing a strategic advantage [49] Question: Promotional intensity for Clear Eyes - Management confirmed that Clear Eyes remains a leading brand, and they do not anticipate changes in promotional activity as they regain shelf space [54] Question: Future plans for Hydralyte - Management discussed the long-term brand building strategy for Hydralyte, emphasizing a slow build in new markets [58] Question: International growth outside Hydralyte - Management highlighted strong growth across various brands in the care business, not limited to Hydralyte [62] Question: Expansion into oral laxatives for Fleet - Management confirmed the launch of constipation-related products under the Fleet brand, connecting with consumers based on the brand's heritage [68] Question: Free cash flow guidance - Management maintained the free cash flow guidance of $240 million or more, feeling positive about cash flow performance [76] Question: Appetite for acquisitions - Management expressed a healthy appetite for M&A opportunities, remaining disciplined in their approach [81]

Revenue Performance - Total revenues for the three months ended December 31, 2024 were $290.3 million, an increase of $7.6 million, or 2.7%, compared to the same period in 2023[94]. - Total revenues for the nine months ended December 31, 2024 were $841.2 million, a decrease of $7.1 million, or 0.8%, compared to the same period in 2023[110]. - North American OTC Healthcare segment revenues increased by $2.4 million, or 1.0%, primarily due to growth in the Gastrointestinal and Dermatologicals categories[95]. - North American OTC Healthcare segment revenues decreased by $16.1 million, or 2.2%, primarily due to declines in Cough & Cold, Women's Health, and Oral Care categories[112]. - International OTC Healthcare segment revenues increased by $5.2 million, or 11.3%, mainly driven by sales growth in the Gastrointestinal category[96]. - International OTC Healthcare segment revenues increased by $8.9 million, or 7.4%, mainly driven by growth in Gastrointestinal and Dermatologicals categories[113]. Profitability Metrics - Gross profit for the three months ended December 31, 2024 increased by $3.1 million, or 2.0%, but gross profit margin decreased to 55.5% from 55.9% due to increased supply chain costs[98]. - Gross profit for the nine months ended December 31, 2024 decreased by $8.2 million, or 1.7%, with gross profit margin declining to 55.2% from 55.7%[114]. - Contribution margin for the North American OTC Healthcare segment increased by $3.3 million, or 3.4%, with a margin of 41.8%, up from 40.8% in the prior year[103]. - Contribution margin for the North American OTC Healthcare segment decreased by $12.8 million, or 4.2%, to 40.8%[120]. - Contribution margin for the International OTC Healthcare segment increased by $1.3 million, or 6.0%, but margin decreased to 45.2% from 47.5% due to higher advertising and marketing expenses[104]. Expenses and Costs - General and administrative expenses were $26.2 million for the three months ended December 31, 2024, slightly up from $26.0 million in the same period of 2023[105]. - Depreciation and amortization expenses decreased to $5.0 million from $5.6 million, primarily due to certain intangible assets being fully depreciated[106]. - Interest expense, net decreased to $11.5 million from $16.6 million, with average indebtedness down to $1.0 billion from $1.3 billion[107]. - Interest expense, net decreased to $36.9 million for the nine months ended December 31, 2024, down from $51.9 million in the same period of 2023[124]. Cash Flow and Investments - Cash provided by operating activities was $189.7 million for the nine months ended December 31, 2024, an increase of $7.6 million compared to $182.0 million in 2023[128]. - Net cash used in investing activities was $14.0 million for the nine months ended December 31, 2024, compared to $5.1 million in 2023, primarily due to the acquisition of Hydralyte intellectual property[129]. - As of December 31, 2024, the company had cash and cash equivalents of $50.9 million, an increase of $4.4 million from March 31, 2024[127]. Debt and Compliance - The company repaid the balance of its 2012 Term B-5 Loans during the three months ended December 31, 2024[132]. - The company has a total debt maturity of $1,000 million, with $400 million maturing in 2028 and $600 million in 2031[133]. - The company must maintain a fixed charge ratio greater than 1.0 to 1.0, and it was in compliance with this requirement as of December 31, 2024[134]. - The company anticipates remaining in compliance with financial and restrictive covenants during the next twelve months[134]. Tax and Currency Exposure - The effective tax rate for the nine months ended December 31, 2024 was 21.8%, down from 23.4% in the same period of 2023[125]. - Approximately 18.2% of gross revenues for the three months ended December 31, 2024, were denominated in currencies other than the U.S. Dollar, compared to 17.0% for the same period in 2023[146]. - A hypothetical 10.0% adverse change in foreign currency exchange rates would have a pre-tax income impact of approximately $3.9 million for the three months ended December 31, 2024[147]. - The company is exposed to foreign currency exchange rate risks primarily with respect to the Canadian and Australian Dollars[146]. Accounting Policies - The company reported no material changes to its critical accounting policies during the nine months ended December 31, 2024[136]. - The company’s 2012 ABL Revolver had a zero balance at December 31, 2024, meaning none of its debt carried a variable rate of interest[145].

Revenue Performance - Reported revenues for Q3 fiscal 2025 were $290.3 million, an increase of 2.7% from $282.7 million in Q3 fiscal 2024[3] - For the first nine months of fiscal 2025, revenues totaled $841.2 million, a decrease of 0.8% compared to $848.4 million in the same period last year[5] - The North American OTC Healthcare segment reported revenues of $238.9 million in Q3 fiscal 2025, a 1.0% increase from $236.6 million in the prior year[11] - International OTC Healthcare segment revenues for Q3 fiscal 2025 were $51.4 million, an increase of 11.3% compared to $46.2 million in the prior year[13] - Total segment revenues for the three months ended December 31, 2024, reached $290,317 thousand, a 2.7% increase from $282,741 thousand in the same period of 2023[31] - Non-GAAP Organic Revenues for the three months ended December 31, 2024, were $290,317 thousand, with a revenue change of 2.3% compared to the previous year[39] Net Income and Earnings - Net income for Q3 fiscal 2025 totaled $61.0 million, compared to $53.0 million in the prior year, with diluted earnings per share of $1.22, up approximately 15% from $1.06[4] - Net income for the nine months ended December 31, 2024, was $164,477 thousand, up from $159,881 thousand in the same period of 2023, representing a growth of 1.0%[29] - GAAP Net Income for Q4 2024 was $61,032,000, compared to $53,046,000 in Q4 2023, representing a 18.7% increase[40] - Projected GAAP Diluted EPS for FY 2025 is $4.58, with a projected Non-GAAP Adjusted Diluted EPS of $4.50 after a normalized tax rate adjustment[42] Cash Flow and Investments - Non-GAAP free cash flow for Q3 fiscal 2025 was $63.5 million, down from $69.5 million in the prior year[9] - Cash and cash equivalents increased to $50,874 thousand at the end of the period, up from $46,469 thousand at the beginning of the period[29] - Non-GAAP Free Cash Flow for Q4 2024 was $63,525,000, compared to $69,476,000 in Q4 2023, indicating a decrease of 8.4%[41] - Projected GAAP Net cash provided by operating activities for FY 2025 is $250,000,000, leading to a projected Non-GAAP Free Cash Flow of $240,000,000 after accounting for property and equipment additions[43] Debt and Liabilities - The company's net debt position as of December 31, 2024, was approximately $0.9 billion, resulting in a leverage ratio of 2.5x[10] - Total liabilities decreased to $1,541,064 thousand as of December 31, 2024, from $1,663,333 thousand on March 31, 2024, a reduction of 7.3%[27] - Interest paid decreased to $37,427 thousand for the nine months ended December 31, 2024, down from $49,666 thousand in the same period of 2023[29] - Interest expense decreased to $11,455,000 in Q4 2024 from $16,575,000 in Q4 2023, a reduction of 30.5%[40] Operational Performance - Operating income for the nine months ended December 31, 2024, was $248,347 thousand, compared to $260,276 thousand in the same period of 2023, reflecting a decrease of 4.6%[34] - Gross profit for the nine months ended December 31, 2024, was $464,453 thousand, compared to $472,631 thousand in the same period of 2023, indicating a decrease of 1.7%[34] - Non-GAAP EBITDA for Q4 2024 was $98,477,000, up from $93,796,000 in Q4 2023, reflecting a 5.7% growth[40] - Non-GAAP EBITDA Margin improved to 33.9% in Q4 2024 from 33.2% in Q4 2023[40] Share Repurchase - The company repurchased approximately 0.6 million shares for a total investment of approximately $40.2 million in the first nine months of fiscal 2025[10] - The company repurchased common stock amounting to $40,196 thousand during the nine months ended December 31, 2024[29] Future Outlook - The company raised its full-year fiscal 2025 earnings outlook, projecting revenues between $1,128 million and $1,132 million[17] - The company anticipates approximately 1% organic revenue growth for fiscal 2025[15]

Core Insights - Prestige Consumer Healthcare Inc. reported strong financial results for the third quarter and first nine months of fiscal 2025, achieving record quarterly sales and earnings per share [2][3][4] - The company experienced a 2.7% increase in third-quarter revenues to $290.3 million compared to $282.7 million in the same period last year, driven by strong international business performance and improved Clear Eyes® revenues [3][11] - Net income for the third quarter rose to $61.0 million, up from $53.0 million in the prior year, with diluted earnings per share increasing to $1.22 from $1.06 [4][11] Financial Performance - For the first nine months of fiscal 2025, reported revenues totaled $841.2 million, a slight decrease of 0.8% from $848.4 million in the same period last year, impacted by supply limitations for Clear Eyes and declines in Cough & Cold and Women's Health categories [5][6] - Net income for the first nine months was $164.5 million, compared to $159.9 million in the prior year, with diluted earnings per share increasing to $3.28 from $3.19 [6][11] Cash Flow and Debt Management - The company generated $65.1 million in net cash from operating activities in the third quarter, down from $71.5 million in the prior year, while non-GAAP free cash flow was $63.5 million, a decrease from $69.5 million [8][11] - For the first nine months, net cash provided by operating activities was $189.7 million, compared to $182.0 million in the prior year, with non-GAAP free cash flow increasing to $184.9 million from $175.6 million [8][11] - The company repurchased approximately 0.6 million shares for about $40.2 million, and its net debt position as of December 31, 2024, was approximately $0.9 billion, resulting in a leverage ratio of 2.5x [9][11] Segment Performance - North American OTC Healthcare segment revenues for the third quarter were $238.9 million, up 1.0% from $236.6 million in the prior year, driven by growth in the Gastrointestinal and Dermatologicals categories [12][13] - International OTC Healthcare segment revenues increased by 11.3% to $51.4 million in the third quarter, with broad-based growth led by the Hydralyte® brand [14][15] Outlook - The company raised its full-year fiscal 2025 earnings outlook, projecting approximately 1% organic revenue growth and adjusted diluted EPS of approximately $4.50 [16][18] - The updated revenue guidance for fiscal 2025 is between $1,128 million and $1,132 million, with free cash flow expected to be $240 million or more [18][47]

Core Insights - Prestige Consumer Healthcare (PBH) has experienced significant growth, with shares increasing by 29.9%, outperforming the industry and S&P 500 [1] - The company holds a Zacks Rank 2 (Buy) and benefits from a diverse brand portfolio and effective marketing strategies [2] Company Overview - Prestige Consumer develops, manufactures, markets, and distributes over-the-counter (OTC) healthcare and household cleaning products across multiple countries [3] - The company has expanded its product offerings through both organic growth and acquisitions, focusing on consumer health and personal care brands [3] Growth Factors - The company's share price increase is attributed to its diverse portfolio of well-known consumer brands, with core brands contributing approximately 58.6% of total revenues in fiscal 2024 [4] - Prestige Consumer emphasizes brand building and product innovation, introducing targeted offerings in niche healthcare categories [5] - The company has established a strong reputation in the Eye & Ear Care category, with Clear Eyes recognized as the largest OTC brand in its category [6] - Significant investments in e-commerce have yielded positive results, enhancing the company's growth potential [7] Financial Estimates - The Zacks Consensus Estimate projects a 5.9% increase in earnings per share (EPS) for fiscal 2025, reaching $4.46, and a 6.7% increase for fiscal 2026, reaching $4.76 [10] - Revenues for fiscal 2025 are expected to grow by 0.7% to $1.13 billion, followed by a 2.4% increase to $1.16 billion in fiscal 2026 [10]

Group 1 - Prestige Consumer Healthcare Inc. will release its fiscal 2025 third quarter earnings on February 6, 2025, before market opening [1] - A conference call to discuss the earnings results will take place on the same day at 8:30 a.m. ET [1] - Participants can access the live Internet webcast of the conference call from the Investor Relations page of the company's website [2] Group 2 - The company will participate in a fireside chat at the 27th annual ICR Conference in Orlando, FL, on January 14th at 11:30 a.m. ET [4] - A live audio webcast of the ICR Conference will be available on the company's Investor Relations page, with a replay accessible later that same day [4] Group 3 - Prestige Consumer Healthcare markets a diverse portfolio of consumer healthcare products, including brands such as Monistat®, Summer's Eve®, BC®, and Goody's® [5] - The company's products are distributed to retail outlets in the U.S., Canada, Australia, and other international markets [5] - Notable products include pain relievers, eye care products, pediatric over-the-counter products, and various treatments for ailments such as motion sickness and diaper rash [5]

Core Insights - Prestige Consumer Healthcare Inc. has expanded the role of Chief Financial Officer Christine Sacco to include Chief Operating Officer responsibilities, effective immediately [1][2] - This strategic move aims to enhance execution of the company's initiatives and drive operational excellence [2] Group 1: Leadership Changes - Christine Sacco has been appointed as both COO and CFO, overseeing the supply chain in addition to her financial responsibilities [1] - Ron Lombardi, CEO of Prestige, emphasized Sacco's strategic leadership and understanding of the business as key to the company's growth during her 8 years as CFO [2] Group 2: Company Performance - Under Sacco's financial leadership since 2016, the company has experienced strong sales, earnings, and cash flow growth, positioning it for future capital allocation flexibility [2] - The company is focused on driving long-term organic and M&A growth through this expanded leadership role [2] Group 3: Company Overview - Prestige Consumer Healthcare is a leading consumer healthcare products company with a diverse portfolio including brands like Monistat, BC, and Dramamine, with sales across the U.S., Canada, Australia, and other international markets [3]