The Hain Celestial Group (HAIN) Q2 2025 earnings summary

Executive summary

• Q2 FY25 net sales were $411–$411.5 million, down 9–9.4% year-over-year, with organic net sales down 6.8–7% due to declines in North America, snacks, and personal care categories.

• Net loss was $104 million ($1.15/share), driven by $91–$107 million in non-cash goodwill and intangible asset impairments, mainly in personal care.

• Adjusted EBITDA was $38 million (9.2% margin), down 19–20% year-over-year, with margin up 350 bps sequentially from Q1.

• Strong operating cash flow and net debt reduction of $12–$15.4 million; free cash flow improved to $24.5–$25 million.

• Strategic review of personal care business underway, with focus on core food and beverage categories and Hain Reimagined strategy.

Financial highlights

• Adjusted gross margin was 22.9%, down 60 bps year-over-year; gross profit margin was 22.7%, up 20 bps.

• SG&A decreased 5% year-over-year to $70–$70.2 million, representing 17% of net sales.

• Interest costs fell 20.7–21% year-over-year to $12.8–$13 million, aided by lower borrowings and reduced rates.

• Adjusted net income was $8 million ($0.08 per diluted share), down from $11 million ($0.12) last year.

• Free cash flow for Q2 was $24.5–$25 million, up from $14.8–$15 million a year ago.

Outlook and guidance

• Fiscal 2025 organic net sales expected to decline 2–4%; adjusted EBITDA projected to be flat year-over-year.

• Gross margin projected to expand by at least 90 bps year-over-year; free cash flow target of at least $60 million.

• Sequential improvement in gross margin and adjusted EBITDA expected, with a material step up in Q4.

• Long-term targets by FY27: 3%+ organic net sales growth, 26%+ gross margin, 12%+ adjusted EBITDA margin, and leverage between 2–3x.