Edgewell Personal Care(US:EPC)2025-11-18 02:28Business Strategy and Growth - The company plans to sell its Feminine Care segment for $340 million, subject to purchase price adjustments upon closing [38]. - The company expects to drive growth in its Sun and Skin Care business through product innovation, increased distribution, and geographic expansion [35]. - The Bulldog skincare products have expanded sales geographically since acquisition, with continued resource commitment for growth [37]. - The company has a diverse portfolio of personal care brands acquired over the years, enhancing its market position [30]. - Customer orders for Sun Care products are highly seasonal, leading to increased sales during late winter through mid-summer months [48]. Market Position and Competition - The company holds the number two global market share position in wet shaving, with significant presence in the U.S., Canada, Japan, Germany, France, and the U.K. [32]. - The company is one of the top three manufacturers of feminine care products in North America, leveraging competitive product technologies [38]. - The company faces competition from major players like Procter & Gamble and Kimberly Clark in the feminine care market [44]. - The global men's skincare market is expected to continue growing, with the company competing through its Bulldog and Jack Black brands [43]. Financial Performance and Risks - Walmart accounted for approximately 17.4% of the company's net sales in fiscal 2025, with Target Corporation representing about 9.2% for the Sun and Skin Care segment and 10.1% for the Feminine Care segment [46]. - The company maintains a cash flow hedging program related to foreign currency risk, with unrealized pre-tax gains of $1.4 million and $2.4 million at September 30, 2025, and 2024, respectively [287]. - The company is exposed to significant currency rate risks, particularly with the euro, Japanese yen, British pound, Canadian dollar, and Australian dollar, which can impact reported earnings [284]. - Outstanding variable-rate debt instruments amounted to $140.0 million, primarily related to the Revolving Credit Facility and international notes payable [293]. - A one percent increase in applicable interest rates would increase annual interest expense by approximately $1.7 million [293]. Innovation and Intellectual Property - As of September 30, 2025, the company owned 271 unexpired U.S. patents and 1,321 foreign patents, with expiration dates ranging from October 2025 to June 2050 [52]. - The company actively pursues foreign patent protection and routinely prepares additional patent applications, indicating a strong focus on innovation and intellectual property [52]. Sustainability and Compliance - The company aims to achieve operational carbon neutrality across its global operations and reduce greenhouse gas emissions as part of its Sustainable Care 2030 strategy [63]. - The company is subject to various environmental regulations, including those from the U.S. FDA and EPA, which govern the manufacture and distribution of its products [54]. - The company is committed to compliance with discrimination laws and fostering an inclusive work environment [70]. Employee Wellbeing and Culture - The company has approximately 6,700 employees, with around 2,000 based in the United States, fostering a culture centered around the guiding purpose of Making Useful Things Joyful [67]. - The company emphasizes employee wellbeing through various programs, including onsite biometric screening and mental health support, aiming to foster a culture of wellbeing by 2025 [69]. - Employee experience survey results show increased confidence in the company's future and a sense of belonging, with improvements noted year over year [72]. - The company’s human resources policies and wellbeing programs are designed to attract and retain key personnel, contributing to positive employee retention rates [69]. Operational Management - The company utilizes a direct sales force supplemented by strategic distributors and wholesalers, with dedicated commercial organizations in key markets [45]. - The principal raw materials include steel, plastic resins, and organic chemicals, which are sourced regionally or globally and are subject to price and availability fluctuations [49]. - The company has established e-commerce operations across several business lines, including partnerships with T-Mall in China to accelerate e-commerce sales [45]. - The company has a strong focus on safety culture, revitalizing its "Alive and Well" program across manufacturing sites [71]. - The company’s executive team includes experienced leaders, with the Chief Executive Officer having served since March 1, 2019, and the Chief Financial Officer since December 1, 2024 [76][84].