Overview

• U.S. health foods maker's fiscal Q3 sales fell 13% and missed analyst expectations

• Adjusted net loss for fiscal Q3 was smaller than analysts expected

• Company says sales decline driven by lower volume/mix, partly offset by higher pricing

Outlook

• Company says completion of North American snacks divestiture expected to enhance margins and cash flow

• Hain Celestial says near-term priorities are optimizing cash, improving profitability and stabilizing sales

• Company says North American core business remains resilient and progress is being made on stranded costs

Result Drivers

• LOWER VOLUME/MIX - Co said sales decline was mainly due to lower volume/mix, partly offset by higher pricing

• CATEGORY WEAKNESS - Baby & kids and meal prep categories saw continued softness, especially in purees and formula in North America and the UK

• COST INFLATION - Gross margin declines were primarily driven by cost inflation, partly offset by productivity savings and pricing

Company press release: ID:nGNX4m6wT9

Key Details

Metric	Beat/Miss	Actual	Consensus Estimate
Q3 Sales	Miss	$338.4 mln	$348.81 mln (4 Analysts)
Q3 Adjusted Net Income	Beat	-$1.2 mln	-$1.77 mln (4 Analysts)
Q3 Net Income		-$106.3 mln
Q3 Adjusted Gross Margin		21.00%

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 1 "strong buy" or "buy", 5 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the food processing peer group is "buy."

• Wall Street's median 12-month price target for Hain Celestial Group Inc is $1.27, about 91.7% above its May 8 closing price of $0.66

• The stock recently traded at 20 times the next 12-month earnings vs. a P/E of 19 three months ago

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