Hain Celestial Agrees to Sell International Business
The health-and-wellness company posted $263 million in fiscal fourth-quarter net sales and said it would become a more focused North American company.
The Hain Celestial Group, Inc. (HAIN), a global health-and-wellness company, said it reached a definitive agreement to sell its International business, a move that would leave a smaller North American operator if the deal closes and the company extends a December debt maturity.
President and Chief Executive Officer Alison Lewis said that, assuming completion of the sale and an agreement with lenders to extend the maturity, Hain “would expect to become a more focused North American company with leading brands in attractive categories and a streamlined operating model.” The company operates two reportable segments, North America and International.
Fiscal fourth-quarter net sales were $263 million, down 28% from a year earlier, a steeper reported decline than the 13% year-over-year drop in the fiscal third quarter and the 7% decline in the fiscal second quarter. Organic net sales declined 2% year-over-year, improving from a 6% organic decline in the third quarter and a 7% organic decline in the second quarter. Volume/mix fell 2 points and pricing was flat.
Lewis said fourth-quarter results reflected “encouraging sequential improvement, including organic net sales growth in North America, gross margin and adjusted EBITDA margin expansion, and continued progress on productivity and cost discipline initiatives.”
North America net sales were $112 million, down 46% year-over-year, with M&A/exit impact of 47 percentage points after the divestiture of the North American snacks business. Organic net sales in the segment increased 2% year-over-year, which the company said was driven primarily by growth in meal prep on strength in yogurt, partially offset by lower sales in baby & kids. Segment gross margin was 30.6%, up 1,140 basis points from the prior-year period, and adjusted gross margin was 31.1%, up 1,190 basis points. The company attributed the increases primarily to volume/mix and productivity savings, partially offset by cost inflation. Adjusted EBITDA in North America was $16 million, up 55% year-over-year, with adjusted EBITDA margin of 14.4%, a 940-basis-point increase.
International net sales were $151 million, down 4% year-over-year. Organic net sales in the segment decreased 4%, which the company said was driven primarily by lower sales in meal prep and baby & kids, partially offset by growth in beverages. Gross margin and adjusted gross margin were both 16.6%, each down 555 basis points, which the company said was driven primarily by cost inflation, partially offset by productivity savings. Adjusted EBITDA was $12 million, down 41% from a year earlier, with adjusted EBITDA margin of 8.1% compared with 13.3% a year earlier.
Consolidated gross profit margin was 22.5%, a 200-basis-point increase from the prior-year period, reversing 90-basis-point year-over-year compression in the fiscal third quarter and 330-basis-point compression in the fiscal second quarter. Adjusted gross profit margin was 22.7%, a 230-basis-point increase. Adjusted EBITDA was $19 million, compared with $26 million in the fiscal third quarter and $24 million in the fiscal second quarter. Net loss was $62 million, compared with a net loss of $273 million a year earlier. Loss per diluted share was $0.68.
Meal prep organic net sales increased 3% year-over-year on $135 million of reported sales, driven primarily by yogurt in North America. Baby & Kids organic net sales declined 11% on $52 million of reported sales, driven primarily by formula and purees in North America and purees in the UK, partially offset by finger foods. Beverages organic net sales declined 2% on $55 million of reported sales, due to promotional activity in North America. Snacks organic net sales declined 7% on $9 million of reported sales after the North American snacks divestiture; the category is now jellies in International. Personal Care reported net sales were $12 million, down 19% year-over-year, and were classified as held for sale.
Net cash provided by operating activities was $11 million in the fiscal fourth quarter, compared with $38 million in the fiscal third quarter and $37 million in the fiscal second quarter. Free cash flow was $7 million, compared with $35 million and $30 million in those earlier quarters. Total debt was $558 million at June 30, 2026, down from $549 million at the end of the fiscal third quarter and $705 million at the end of the fiscal second quarter. Net debt was $500 million. The net secured leverage ratio was 4.5x as calculated under the credit agreement, versus 4.3x at the end of the fiscal third quarter and 4.9x at the end of the fiscal second quarter.
Lewis said fiscal 2026 was a pivotal year in which the company simplified its portfolio, reduced debt, improved free cash flow and exited the year with improving momentum.