Helen of Troy Limited Reports Solid Fourth Quarter Fiscal 2024 Results
EL PASO, Texas , April 24 /Businesswire/ - Helen of Troy Limited (NASDAQ: HELE), designer, developer, and worldwide marketer of branded consumer home, outdoor, beauty, and wellness products, today reported results for the three-month period ended February 29, 2024 and provided its outlook for Fiscal 2025.
Executive Summary – Fourth Quarter of Fiscal 2024 Compared to Fiscal 2023
Executive Summary - Fiscal 2024 Compared to Fiscal 2023
Noel M. Geoffroy, Chief Executive Officer, stated: “We ended the year on a positive note, reporting fourth quarter results that exceeded our expectations while making critical progress toward our long-term growth and efficiency goals. The fourth quarter was highlighted by net sales and adjusted EPS ahead of our outlook, expanded gross profit and adjusted EBITDA margins, and strong cash flow generation that further strengthened our durable balance sheet. We are pleased to achieve these results despite an environment where consumers focused their more limited discretionary spending on experiences and services over products. I am proud of how our associates have embraced our new organizational model as a true global operating company designed to enable greater focus and centralized expertise.”
Ms. Geoffroy continued: “Looking ahead to fiscal 2025, we have many reasons to be excited as we begin our Elevate for Growth era, even as we navigate what we anticipate will be an increasingly pressured environment. Our consumers are our number one priority. Our mission is to delight them with quality brands and products with the right message, in the right place, at the right time. I am confident that Elevate for Growth represents an important pivot for the Company, emphasizing relentless consumer obsession in all that we do, a new portfolio management approach to sharpen our resource allocation, incremental growth investment in our brands and our capabilities, and new distribution opportunities. We believe these new choices position us to deliver our objectives in fiscal 2025 and beyond.”
|
Three Months Ended Last Day of February, |
||||||||||
(in thousands) (unaudited) |
Home & Outdoor |
|
Beauty & Wellness |
|
Total |
||||||
Fiscal 2023 sales revenue, net |
$ |
211,926 |
|
|
$ |
272,657 |
|
|
$ |
484,583 |
|
Organic business (4) |
|
10,818 |
|
|
|
(7,618 |
) |
|
|
3,200 |
|
Impact of foreign currency |
|
568 |
|
|
|
850 |
|
|
|
1,418 |
|
Change in sales revenue, net |
|
11,386 |
|
|
|
(6,768 |
) |
|
|
4,618 |
|
Fiscal 2024 sales revenue, net |
$ |
223,312 |
|
|
$ |
265,889 |
|
|
$ |
489,201 |
|
|
|
|
|
|
|
||||||
Total net sales revenue growth (decline) |
|
5.4 |
% |
|
|
(2.5 |
)% |
|
|
1.0 |
% |
Organic business |
|
5.1 |
% |
|
|
(2.8 |
)% |
|
|
0.7 |
% |
Impact of foreign currency |
|
0.3 |
% |
|
|
0.3 |
% |
|
|
0.3 |
% |
|
|
|
|
|
|
||||||
Operating margin (GAAP) |
|
|
|
|
|
||||||
Fiscal 2024 |
|
15.7 |
% |
|
|
11.7 |
% |
|
|
13.5 |
% |
Fiscal 2023 |
|
14.8 |
% |
|
|
8.2 |
% |
|
|
11.1 |
% |
Adjusted operating margin (non-GAAP) (1) |
|
|
|
|
|
||||||
Fiscal 2024 |
|
18.7 |
% |
|
|
15.6 |
% |
|
|
17.0 |
% |
Fiscal 2023 |
|
17.1 |
% |
|
|
11.2 |
% |
|
|
13.8 |
% |
|
Three Months Ended Last Day of February, |
|
% Change |
|
4-Year CAGR |
||||||
(in thousands, except per share data) (unaudited) |
|
2024 |
|
|
2023 |
|
FY24/FY23 |
|
|||
Consolidated net sales revenue |
$ |
489,201 |
|
$ |
484,583 |
|
1.0 |
% |
|
2.5 |
% |
Net income |
|
42,734 |
|
|
36,180 |
|
18.1 |
% |
|
* |
|
Adjusted EBITDA (non-GAAP) (1) |
|
94,308 |
|
|
73,421 |
|
28.4 |
% |
|
12.7 |
% |
Net cash provided by operating activities |
|
73,608 |
|
|
158,719 |
|
(53.6 |
)% |
|
(18.9 |
)% |
|
|
|
|
|
|
|
|
||||
Diluted EPS |
$ |
1.79 |
|
$ |
1.50 |
|
19.3 |
% |
|
* |
|
Adjusted Diluted EPS (non-GAAP) (1) |
|
2.45 |
|
|
2.01 |
|
21.9 |
% |
|
6.8 |
% |
* Calculation is not meaningful. |
|
Fiscal Year Ended Last Day of February, |
|
% Change |
|
4-Year CAGR |
||||||
(in thousands, except per share data) (unaudited) |
|
2024 |
|
|
2023 |
|
FY24/FY23 |
|
|||
Consolidated net sales revenue |
$ |
2,005,050 |
|
$ |
2,072,667 |
|
(3.3 |
)% |
|
4.1 |
% |
Net income |
|
168,594 |
|
|
143,273 |
|
17.7 |
% |
|
2.6 |
% |
Adjusted EBITDA (non-GAAP) (1) |
|
336,213 |
|
|
327,519 |
|
2.7 |
% |
|
4.1 |
% |
Net cash provided by operating activities |
|
306,067 |
|
|
208,242 |
|
47.0 |
% |
|
3.1 |
% |
|
|
|
|
|
|
|
|
||||
Diluted EPS |
$ |
7.03 |
|
$ |
5.95 |
|
18.2 |
% |
|
4.0 |
% |
Adjusted Diluted EPS (non-GAAP) (1) |
|
8.91 |
|
|
9.45 |
|
(5.7 |
)% |
|
(1.1 |
)% |
Consolidated Results - Fourth Quarter Fiscal 2024 Compared to Fourth Quarter Fiscal 2023
On an adjusted basis (non-GAAP) for the fourth quarters of fiscal 2024 and 2023, excluding EPA compliance costs, restructuring charges, amortization of intangible assets, and non-cash share-based compensation, as applicable:
Segment Results - Fourth Quarter Fiscal 2024 Compared to Fourth Quarter Fiscal 2023
Home & Outdoor net sales revenue increased $11.4 million, or 5.4%, to $223.3 million, compared to $211.9 million. The increase was driven by growth from Organic business of $10.8 million, or 5.1%, primarily due to an increase in home category sales in the brick and mortar and club channels, higher insulated beverageware sales, primarily driven by the new travel tumbler, and international growth primarily driven by strong demand for travel packs. These factors were partially offset by the unfavorable impact of the Bed, Bath & Beyond bankruptcy and a decrease in online channel sales in the travel pack and home categories.
Home & Outdoor operating income was $35.0 million, or 15.7% of segment net sales revenue, compared to $31.3 million, or 14.8% of segment net sales revenue. The 90 basis point increase in segment operating margin was primarily due to lower commodity and inbound freight costs, a decrease in restructuring charges of $2.6 million, lower trade discount and program expense, and a decrease in inventory obsolescence expense. These factors were partially offset by an increase in depreciation and distribution expense primarily due to a new distribution facility, higher share-based compensation expense, an increase in annual incentive compensation expense, and a less favorable customer and product mix. Adjusted operating income increased 15.3% to $41.7 million, or 18.7% of segment net sales revenue, compared to $36.2 million, or 17.1% of segment net sales revenue.
Beauty & Wellness net sales revenue decreased $6.8 million, or 2.5%, to $265.9 million, compared to $272.7 million. The decrease was driven by a decrease from Organic business of $7.6 million, or 2.8%, primarily due to lower sales of air purifiers, fans, and heaters, primarily driven by SKU rationalization and softer consumer demand, and a decline in humidification reflecting a cough/cold/flu season illness incidence below the prior year and pre-Covid historical averages. These factors were partially offset by growth in hair appliances and thermometry, which helped drive higher overall international sales, and an increase in sales of prestige hair care products.
Beauty & Wellness operating income was $31.2 million, or 11.7% of segment net sales revenue, compared to $22.4 million, or 8.2% of segment net sales revenue. The 350 basis point increase in segment operating margin was primarily due to a decrease in inventory obsolescence expense, a decrease in restructuring charges of $5.6 million, lower trade discount and program expense, decreased distribution expense, the favorable comparative impact of EPA compliance costs of $1.5 million incurred in the prior year period, reduced inbound freight costs, and a more favorable product mix including the favorable impact of SKU rationalization efforts. These factors were partially offset by higher share-based compensation expense, increased marketing investment, and increased annual incentive compensation expense. Adjusted operating income increased 36.2% to $41.5 million, or 15.6% of segment net sales revenue, compared to $30.5 million, or 11.2% of segment net sales revenue.
Balance Sheet and Cash Flow - Fiscal 2024 Compared to Fiscal 2023