Hain Celestial Group, Inc. (HAIN) shares surged in pre-market trading on Tuesday after the company released its fourth-quarter earnings report. Despite revenue falling short of analyst expectations, the company’s strong performance in key areas fueled investor optimism.
The company reported adjusted earnings per share of 13 cents, exceeding the analyst consensus estimate of 8 cents. However, quarterly revenues of $418.80 million missed the street view of $421.2 million. Net sales declined by 6% year-over-year, with organic net sales experiencing a 4% decrease compared to the previous year.
Hain Celestial’s segments showed mixed performance. While Beverages registered a 3% year-over-year increase in net sales, the Baby & Kids unit experienced a 10% decline. The Snacks segment saw flat organic net sales growth year-over-year, while Personal care witnessed a significant 17% drop in organic net sales.
Despite the mixed revenue picture, Hain Celestial reported positive developments in profitability. The adjusted gross profit margin expanded by 70 basis points to 23.4% compared to the previous year. Adjusted net income climbed to $11 million, an increase from $10 million in the prior year.
However, adjusted EBITDA decreased to $40 million from $44 million year-over-year, resulting in a 30 basis point decline in the adjusted EBITDA margin to 9.4%.
Looking ahead, Hain Celestial anticipates flat or better organic net sales growth for fiscal year 2025. The company also expects its gross margin to increase by at least 125 basis points.
“Our fuel initiatives exceeded our targets for fiscal 2024, allowing us to pay down debt, invest in capabilities, and to deliver on our updated full-year guidance,” said Wendy Davidson, President and CEO.
As of Tuesday’s pre-market trading, HAIN shares were trading 8.20% higher at $7.39.
