Net Income of $0.19 per share for Fourth Quarter and $0.79 for Fiscal 2003 Full Year
Revenue Grows 23.4% in the Fourth Quarter and 17.8% in Fiscal 2003 Full Year
Announces Three-Year $30 Million Savings Initiative
MELVILLE, N.Y., Sept. 2 /PRNewswire-FirstCall/ -- The Hain Celestial Group (Nasdaq: HAIN), the leading natural and organic food company, today announced results for the Fiscal 2003 fourth quarter and full year ended June 30, 2003. Hain Celestial reported net income of $6.8 million, or $0.19 per share in the fourth quarter this year, compared with a net loss of $12.8 million, or $0.38 net loss per share in the prior year's comparable quarter. For the Fiscal 2003 full year, Hain Celestial reported net income of $27.5 million, or $0.79 per share, compared with $3 million, or $0.09 per share in the prior year.
Fourth quarter sales grew 23.4% to $117.8 million, compared with net sales of $95.4 million in the prior year period. For the Fiscal 2003 full year, net sales grew to $466.5 million, a 17.8% increase over prior year sales of $396 million.
Irwin Simon, President and Chief Executive Officer, said, "Our performance this quarter capped an exciting year for our Company. Following a challenging first half of the quarter as a result of economic conditions and the domestic impact of the war in Iraq, we recovered well in the second half of the quarter. Strong growth across many of our businesses contributed to another excellent overall quarter of sales and profitable growth. We are particularly pleased with our distribution gains in the quarter, including the very successful introduction in 600 McDonald's restaurants across Southern California of the co-branded Yves McVeggie burger as part of their new Salads and More menu roll-out. We have also successfully introduced our Terra Chips and Garden of Eatin' healthy snacks in thousands of 7-Eleven stores nationally."
"This year we accomplished much and laid a solid foundation for further profitable growth in Fiscal 2004. We improved our performance, with sales up 18% for the year. We also dramatically improved our operating income and margins. We completed three important acquisitions: Imagine Foods and Walnut Acres in the United States, and Grains Noirs in Europe, and fully integrated Imagine within the fiscal year. Our Yves brand is now being served nationally in 1,300 McDonald's restaurants in Canada, as well as in the United States as a co-branded menu item in Southern California. And in Fiscal 2003 we upgraded our management team by adding new talent, including Fran Daily, David Cowperthwait, and Jay Lieberman, and appointing existing executives Steve List as the General Manager at Celestial Seasonings, where he and his leadership team have brought a new excitement to the brand and, most recently, Ellen Deutsch as Chief Growth Officer, a new position in which she will lead us in the development of new opportunities for distribution -- in convenience stores, food service, and military installations -- and in new concepts for our company. Each of these executives has brought a fresh perspective and an accomplished track record to their new position at Hain Celestial."
"This is Hain Celestial's tenth anniversary year, and I am exceptionally proud of all the hard work of our employees over this past decade. We have built the world's leading natural and organic food company from very small beginnings. Our brands and products are well known and well positioned, leading 13 of the 15 key organic and natural food categories. The growing public awareness of the benefits of healthy eating, and fighting the risks of obesity, present us with even more opportunities in the future. That is why we now must go further to meet the expanding market for our products, and provide more consumers with the healthy foods and beverages they want."
"To accomplish these growth objectives, we must be even more competitive, efficient and innovative. In the year to come, I expect that we will: realize new distribution opportunities with our existing customers, other mass market, and non-traditional channels; introduce innovative new products and flavors; expand our international business; and continue the integration of our acquired businesses and brands. We also plan to launch a new program to improve supply chain management that should ultimately reduce costs after three years by $30 million per year," said Mr. Simon.
The reported fourth quarter results include a credit for restructuring which arose when the Company successfully terminated the lease on the former Health Valley Irwindale manufacturing facility for an amount lower than originally provided for. This resulted in a reduction of the Company's restructuring reserves by approximately $0.9 million in the fourth quarter. As a result, the restructuring line for the Fiscal 2003 full year amounted to a credit of approximately $0.4 million.
Also included in the reported results in fourth quarter gross profit this year is a valuation allowance of $1.5 million related to chargebacks receivable from customers and a $2.0 million reduction of reserves established last year in connection with similar items included in the charges the Company recorded for supplements and other items. These offsetting items increased gross profit by $0.5 million.
Mr. Simon concluded, "As we look forward to our Fiscal 2004, we are providing earnings guidance for the full year of $0.95 - $1.03 per share on revenues of $540 - $565 million. We have discontinued the practice of providing shorter-term, quarterly guidance as have many other companies, so we can better focus on building sustainable value for our shareholders by achieving mid to long-term goals."
About The Hain Celestial Group
The Hain Celestial Group, headquartered in Melville, NY, is a natural, specialty and snack food company. The Company is a leader in 13 of the top 15 natural food categories, with such well-known natural food brands as Celestial Seasonings (R) teas, Walnut Acres(R), Hain Pure Foods(R), Westbrae(R), Westsoy(R), Rice Dream(R), Soy Dream(R), Imagine(R), Arrowhead Mills(R), Health Valley(R), Breadshop's(R), Casbah(R), Garden of Eatin(R), Terra Chips(R), Yves Veggie Cuisine(R), The Good Dog (R), The Good Slice(R), DeBoles(R), Lima(R), Biomarche(R), Grains Noirs(R), Earth's Best(R), and Nile Spice. The Company's principal specialty product lines include Hollywood(R) cooking oils, Estee(R) sugar-free products, Kineret(R) kosher foods, Boston Better Snacks(R), and Alba Foods(R). The Hain Celestial Group's website can be found at www.hain-celestial.com.
Statements made in this Press Release that are estimates of past or future performance are based on a number of factors, some of which are outside of the Company's control. Statements made in this Press Release that state the intentions, beliefs, expectations or predictions of The Hain Celestial Group and its management for the future are forward-looking statements. It is important to note that actual results could differ materially from those projected in such forward-looking statements. Information concerning factors that could cause actual results to differ materially from those in forward-looking statements is contained from time to time in filings of The Hain Celestial Group with the U.S. Securities and Exchange Commission. Copies of these filings may be obtained by contacting The Hain Celestial Group or the SEC.