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Prestige sumer Healthcare (PBH) - 2026 Q1 - Quarterly Results

Fiscal 2026 First Quarter Financial Highlights Executive Summary Prestige Consumer Healthcare Inc. reported mixed Q1 FY26 results, with international growth and improved gross margin offset by Clear Eyes supply constraints, leading to a revenue decline and a revised full-year outlook - The company experienced momentum in international segment growth, year-over-year improvement in gross margin, and solid quarterly free cash flow2 - Positives were offset by Clear Eyes supply constraints, resulting in lower-than-expected shipments23 - The company announced an agreement to acquire Pillar5 Pharma, a current eye care supplier, to improve eye care supply in the second half of fiscal 202627 - Fiscal 2026 revenue outlook was revised to $1,100 to $1,115 million, and Diluted EPS outlook to $4.50 to $4.587 Key Financial Results (Q1 FY26 vs Q1 FY25) Q1 FY26 reported revenues decreased by 6.6% to $249.5 million due to Clear Eyes supply issues, while net income slightly declined and diluted EPS increased by 5.6% (based on adjusted EPS from table) | Metric | Q1 FY26 (Millions) | Q1 FY25 (Millions) | Change (%) | | :------------------- | :----------------- | :----------------- | :--------- | | Reported Revenues | $249.5 | $267.1 | -6.6% | | Net Income | $47.5 | $49.1 | -3.3% | | Diluted EPS | $0.95 | $0.98 | -3.1% | | Adjusted Diluted EPS | $0.95 | $0.90 | +5.6% | - The revenue decline was driven by limited ability to supply demand for Clear Eyes and an expected headwind from accelerated order timing in Q4 of the prior year3 Free Cash Flow and Balance Sheet Q1 FY26 saw strong cash generation with a 44.2% increase in operating cash flow and 45.9% increase in non-GAAP free cash flow, maintaining stable net debt and a 2.4x leverage ratio | Metric | Q1 FY26 (Millions) | Q1 FY25 (Millions) | Change (YoY) | | :-------------------------------------- | :----------------- | :----------------- | :----------- | | Net cash provided by operating activities | $79.0 | $54.8 | +44.2% | | Non-GAAP Free Cash Flow | $78.2 | $53.6 | +45.9% | - The material increase in free cash flow was attributable to the timing of working capital and lower interest expense6 | Metric | As of June 30, 2025 (Millions) | | :---------------------- | :----------------------------- | | Net Debt | ~$0.9 | | Covenant-defined Leverage Ratio | 2.4x | Segment Performance Review North American OTC Healthcare North American OTC Healthcare segment revenue decreased by 8.5% in Q1 FY26, primarily due to limited Clear Eyes supply and accelerated orders in the prior year | Metric | Q1 FY26 (Millions) | Q1 FY25 (Millions) | Change (%) | | :--------------- | :----------------- | :----------------- | :--------- | | Segment Revenues | $212.6 | $232.3 | -8.5% | - The revenue decrease was primarily attributable to lower Eye & Ear Care category sales, driven by limited ability to supply demand for Clear Eyes and the expected headwind associated with accelerated order timing in Q4 of the prior year9 International OTC Healthcare International OTC Healthcare segment revenues grew strongly by 6.1% in Q1 FY26, driven by broad-based growth across various geographies | Metric | Q1 FY26 (Millions) | Q1 FY25 (Millions) | Change (%) | | :--------------- | :----------------- | :----------------- | :--------- | | Segment Revenues | $37.0 | $34.8 | +6.1% | - The revenue performance was driven by broad-based growth across geographies10 Strategic Initiatives and Outlook Acquisition of Pillar5 Pharma Prestige Consumer Healthcare Inc. will acquire Pillar5 Pharma, a key Clear Eyes supplier, to expand eye care production capacity and secure supply, with the transaction expected to be EPS-neutral and close in Q3 FY26 - The Company has entered into a definitive agreement to acquire Pillar5 Pharma Inc., a leading sterile ophthalmic manufacturer and current Clear Eyes supplier11 - The acquisition is part of a long-term strategy to expand eye care production capacity, secure near-term supply, and build long-term supply chain capacity for Clear Eyes1113 - The transaction is expected to be approximately neutral to EPS and is anticipated to close in the third quarter of fiscal 202611 Updated Fiscal 2026 Outlook The company revised its FY26 outlook, lowering revenue and diluted EPS due to eye care supply shortfalls, but maintained its free cash flow forecast of $245 million or more - The revised outlook primarily reflects supply chain shortfalls in eye care expected to persist in the first half of fiscal 202614 | Metric | Initial Fiscal 2026 Outlook | Current Fiscal 2026 Outlook | | :-------------------- | :-------------------------- | :-------------------------- | | Revenue | $1,140 to $1,155 million | $1,100 to $1,115 million | | Organic Revenue Growth | Approximately 1% to 2% | Approximate 1.5% to 3.0% decrease | | Diluted E.P.S. | $4.70 to $4.82 | $4.50 to $4.58 | | Free Cash Flow | $245 million or more | $245 million or more | - The company still anticipates year-over-year growth from an acceleration of supply in eye care in the second half, thanks to its multi-year strategy to enhance long-term capacity14 Company Information About Prestige Consumer Healthcare Inc. Prestige Consumer Healthcare is a leading consumer healthcare products company with a diverse brand portfolio sold across the U.S., Canada, Australia, and other international markets - Prestige Consumer Healthcare is a leading consumer healthcare products company with sales throughout the U.S. and Canada, Australia, and in certain other international markets22 - The company's diverse portfolio includes brands such as Monistat®, Summer's Eve®, BC®, Goody's®, Clear Eyes®, TheraTears®, DenTek®, Dramamine®, Fleet®, Chloraseptic®, Luden's®, Compound W®, Little Remedies®, Boudreaux's Butt Paste®, Nix®, Debrox®, Gaviscon®, Hydralyte®, and Fess®22 Conference Call Details A conference call was held on August 7, 2025, to discuss Q1 FY26 results, with access via live webcast, slide presentation, and archived replay on the Investor Relations page - A conference call to review Q1 FY26 results was held on August 7, 2025, at 8:30 a.m. ET17 - Access to the live internet webcast, accompanying slide presentation, and an archived replay is available on the Investor Relations page of the Company's website1718 Forward-Looking Statements This news release contains forward-looking statements based on management's estimates, subject to inherent uncertainties and risks that could cause actual results to differ materially - The news release contains forward-looking statements regarding future operating results, including revenues, organic growth, diluted EPS, and free cash flow, as well as the impact of the Pillar5 acquisition and the company's ability to enhance shareholder value20 - These statements are based on management's estimates and assumptions and are inherently uncertain and difficult to predict20 - Actual results could differ materially due to factors such as business and economic conditions, consumer trends, competitive pressures, the ability to meet Pillar5 closing conditions, and supply chain capabilities2021 Financial Statements (Unaudited) Condensed Consolidated Statements of Income and Comprehensive Income | (In thousands, except per share data) | 2025 | 2024 | | :------------------------------------ | :---------- | :---------- | | Total Revenues | $249,530 | $267,142 | | Cost of sales | 109,199 | 121,120 | | Gross profit | 140,331 | 146,022 | | Total operating expenses | 68,575 | 73,976 | | Operating income | 71,756 | 72,046 | | Total other expense, net | 9,979 | 13,633 | | Income before income taxes | 61,777 | 58,413 | | Provision for income taxes | 14,311 | 9,345 | | Net income | $47,466 | $49,068 | | Diluted EPS | $0.95 | $0.98 | | Comprehensive income | $52,870 | $52,228 | Condensed Consolidated Balance Sheets | (In thousands) | June 30, 2025 | March 31, 2025 | | :------------------------------------ | :------------ | :------------- | | Cash and cash equivalents | $139,502 | $97,884 | | Total current assets | 480,518 | 448,328 | | Property, plant and equipment, net | 73,786 | 74,548 | | Goodwill | 528,314 | 527,425 | | Intangible assets, net | 2,294,829 | 2,295,350 | | Total Assets | $3,431,625 | $3,402,218 | | Total current liabilities | 109,668 | 106,623 | | Long-term debt, net | 992,749 | 992,357 | | Total Liabilities | 1,576,143 | 1,567,321 | | Total Stockholders' Equity | 1,855,482 | 1,834,897 | | Total Liabilities and Stockholders' Equity | $3,431,625 | $3,402,218 | Condensed Consolidated Statements of Cash Flows | (In thousands) | 2025 | 2024 | | :---------------------------------------- | :---------- | :---------- | | Net cash provided by operating activities | $79,013 | $54,776 | | Net cash used in investing activities | (1,938) | (2,130) | | Net cash used in financing activities | (36,282) | (65,522) | | Increase in cash and cash equivalents | 41,618 | (12,213) | | Cash and cash equivalents - end of period | $139,502 | $34,256 | Condensed Consolidated Statements of Income - Business Segments | (In thousands) | North American OTC Healthcare (2025) | International OTC Healthcare (2025) | Consolidated (2025) | | :-------------------- | :----------------------------------- | :---------------------------------- | :------------------ | | Total segment revenues | $212,578 | $36,952 | $249,530 | | Cost of sales | 92,178 | 17,021 | 109,199 | | Gross profit | 120,400 | 19,931 | 140,331 | | Advertising and marketing | 28,954 | 5,983 | 34,937 | | Contribution margin | $91,446 | $13,948 | $105,394 | | (In thousands) | North American OTC Healthcare (2024) | International OTC Healthcare (2024) | Consolidated (2024) | | :-------------------- | :----------------------------------- | :---------------------------------- | :------------------ | | Total segment revenues | $232,316 | $34,826 | $267,142 | | Cost of sales | 105,559 | 15,561 | 121,120 | | Gross profit | 126,757 | 19,265 | 146,022 | | Advertising and marketing | 33,753 | 5,612 | 39,365 | | Contribution margin | $93,004 | $13,653 | $106,657 | Non-GAAP Financial Measures About Non-GAAP Financial Measures The company provides Non-GAAP financial measures (NGFMs) for greater transparency and performance understanding, used internally but not as alternatives to GAAP measures - NGFMs are provided to aid investors in understanding the Company's performance and offer greater transparency32 - NGFMs are used internally for evaluating operating performance, making financial and operational decisions, and assessing shareholder value32 - NGFMs are not in accordance with GAAP, should not be considered a measure of profitability or liquidity, and may not be directly comparable to similarly titled NGFMs reported by other companies33 Reconciliation of Non-GAAP Measures Reconciliation of GAAP Total Revenues to Non-GAAP Organic Revenues | (In thousands) | 2025 | 2024 | | :-------------------------- | :---------- | :---------- | | GAAP Total Revenues | $249,530 | $267,142 | | Revenue Change | (6.6)% | | | Impact of foreign currency exchange rates | — | (670) | | Non-GAAP Organic Revenues | $249,530 | $266,472 | | Non-GAAP Organic Revenue Change | (6.4)% | | Reconciliation of GAAP Net Income to Non-GAAP EBITDA | (In thousands) | 2025 | 2024 | | :-------------------------- | :---------- | :---------- | | GAAP Net Income | $47,466 | $49,068 | | Interest expense, net | 10,203 | 13,137 | | Provision for income taxes | 14,311 | 9,345 | | Depreciation and amortization | 7,666 | 8,124 | | Non-GAAP EBITDA | $79,646 | $79,674 | | Non-GAAP EBITDA Margin | 31.9 % | 29.8 % | Reconciliation of GAAP Net Income and Diluted EPS to Non-GAAP Adjusted Net Income and Diluted EPS | (In thousands, except per share data) | 2025 Net Income | 2025 Diluted EPS | 2024 Net Income | 2024 Diluted EPS | | :------------------------------------ | :-------------- | :--------------- | :-------------- | :--------------- | | GAAP Net Income and Diluted EPS | $47,466 | $0.95 | $49,068 | $0.98 | | Normalized tax rate adjustment | — | — | (4,030) | (0.08) | | Non-GAAP Adjusted Net Income and Adjusted Diluted EPS | $47,466 | $0.95 | $45,038 | $0.90 | Reconciliation of GAAP Net Income to Non-GAAP Free Cash Flow | (In thousands) | 2025 | 2024 | | :---------------------------------------- | :---------- | :---------- | | GAAP Net cash provided by operating activities | $79,013 | $54,776 | | Purchases of property and equipment | (838) | (1,152) | | Non-GAAP Free Cash Flow | $78,175 | $53,624 | Outlook for Fiscal Year 2026: Reconciliation of Projected GAAP Net cash provided by operating activities to Projected Non-GAAP Free Cash Flow | (In millions) | Amount | | :------------------------------------------------ | :----- | | Projected FY'26 GAAP Net cash provided by operating activities | $255 | | Additions to property and equipment for cash | (10) | | Projected FY'26 Non-GAAP Free Cash Flow | $245 |