Financial Data and Key Metrics Changes - The company reported a net sales decline of 10.2% in Q3, with organic sales decreasing by 11.1% when excluding foreign currency benefits [20][34] - Adjusted EBITDA was $76.6 million, a decrease of $29.7 million year-over-year, primarily due to lower sales volumes and reduced gross margins [35][36] - Gross margins contracted by 110 basis points to 37.8%, driven by unfavorable mix, tariffs, and inflation [21][35] Business Line Data and Key Metrics Changes - Global Pet Care reported a net sales decrease of 9.6%, with organic sales down 11.4%, primarily due to targeted stop shipments during tariff-related pricing negotiations [38][39] - Home and Garden net sales decreased by 10.3%, negatively impacted by a cold and wet start to the season [46] - Home and Personal Care saw a reported net sales decline of 10.8%, with organic sales also down 11.4%, driven by softness in personal care and home appliance categories [52][53] Market Data and Key Metrics Changes - The overall North American Companion Animal category declined in the low single digits, while European consumer sentiment weakened, impacting sales [40][45] - In Latin America, organic net sales grew in the low double digits, predominantly in the chews category [41] - The Home and Garden category experienced lower total sales, but Spectracide gained market share in pest control products [47] Company Strategy and Development Direction - The company is focused on protecting its balance sheet and maintaining a nimble stance during volatile times, with a target of approximately $160 million in free cash flow for the fiscal year [26][60] - There is an ongoing effort to diversify the supplier base and develop non-Chinese sourcing alternatives to mitigate tariff impacts [16][17] - The company is actively pursuing M&A opportunities to accelerate growth in its pet and home and garden businesses, while maintaining a disciplined approach to capital allocation [29][83] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in overcoming near-term tariff-related volatility and emphasized the importance of making difficult decisions for long-term health [19][66] - There are signs of improving macroeconomic conditions, with expectations for consumer confidence to stabilize as geopolitical tensions subside [65][66] - The company anticipates a strong start to Q4, with improved sales performance and positive momentum in the Home and Garden division [23][66] Other Important Information - The company executed cost reduction activities, expecting to reduce costs by over $50 million in fiscal 2025 [15] - Share repurchases totaled approximately 900,000 shares during Q3, with a total of about 4 million shares repurchased since the HHI transaction [31] - The company is streamlining its global business and reducing fixed costs while diversifying its sourcing footprint [59] Q&A Session Summary Question: How much sales were left on the table by stopping shipments in Q2, and what impact lingers into Q4? - The estimated sales left on the table in Q3 is around $30 million, with a significantly lower impact expected in Q4 [72] Question: Why is guidance still difficult despite improved clarity on tariffs? - The company emphasized the complexity of the situation, noting that Q3 results were distorted due to significant operational changes and tariff impacts, making it challenging to provide accurate guidance [75][76] Question: Can you discuss your capital allocation strategy in a soft consumer environment? - The company believes the market is undervalued and plans to continue share repurchases while pursuing M&A opportunities to grow its pet and home and garden businesses [82][83]

Fiscal 2025 Third Quarter Earnings Call August 7, 2025 Hex: #CAE8FA RGB: 202-232-250 Hex: #565656 RGB: 86-86-86 Hex: #192D53 RGB: 25-45-83 Hex: #67AE3E RGB: 103-174-62 Hex: #0066B3 RGB: 0-102-179 Hex: #BCBEC0 RGB: 188-190-192 Hex: #808285 RGB: 128-130-133 Hex: #333333 RGB: 51-51-51 Hex: #00C0F3 RGB: 0-192-243 RGB: 0-192-243 • Introduction – Joanne Chomiak Senior Vice President, Tax and Treasury • CEO Overview – David Maura Chairman and Chief Executive Officer Hex: #CAE8FA RGB: 202-232-250 Hex: #565656 RGB: ...

Financial Data and Key Metrics Changes - In Q2, net sales decreased by 6%, while organic net sales decreased by 4.6% when excluding unfavorable foreign exchange impacts [21][36] - Adjusted EBITDA was $71.3 million, a decline of $24 million compared to the previous year, excluding investment income [23][36] - Gross margins decreased by 60 basis points to 37.5%, driven by lower volume, higher trade promotions, and inflation [23][36] Business Line Data and Key Metrics Changes - Global Pet Care reported a 7.1% decrease in net sales, with organic sales down 6.3%, primarily due to softness in the companion animal and aquatics categories [41][42] - Home and Garden net sales decreased by 5.2%, attributed to timing shifts and retailer inventory builds [47][50] - Home and Personal Care saw a 5.1% decrease in reported net sales, with organic net sales down 2.2% due to softness in North America [54][56] Market Data and Key Metrics Changes - Consumer sentiment in the U.S. weakened, impacting category growth, with consumers seeking value amid economic uncertainty [22][24] - EMEA organic sales for Global Pet Care grew mid-single digits, while North American sales declined low double digits [42][43] - Latin America experienced low double-digit growth in organic net sales, driven by distribution wins and new product launches [57] Company Strategy and Development Direction - The company is focused on protecting its balance sheet and generating free cash flow, targeting approximately $160 million for the year [25][62] - Plans to transition sourcing out of China are underway, with expectations to have minimal exposure by the end of the fiscal year [12][71] - The company aims to leverage its strong balance sheet for potential acquisitions in the pet category, positioning itself as a consolidator in the market [28][67] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the current tariff environment and emphasized the importance of maintaining liquidity and a strong balance sheet [19][70] - The company anticipates that the challenges related to tariffs will be resolved in the coming quarters, particularly for the Global Pet Care and Home and Garden segments [70][72] - Management remains optimistic about future growth opportunities despite current economic volatility [74] Other Important Information - The company repurchased approximately 3.2 million shares year-to-date, returning over $1.28 billion to shareholders since the HHI transaction [32][33] - Adjusted diluted EPS decreased to $0.68, driven by lower adjusted EBITDA and operating income [37][60] Q&A Session Summary Question: Any areas where you see yourself competitively advantaged versus your peers given the new landscape? - Management indicated that while the playing field is level, the company's scale and strong brand presence provide a competitive advantage in securing supply outside of China [79][82] Question: How is the company positioned to handle the current tariff situation? - Management highlighted that the company is well-prepared to transition sourcing and expects to have minimal exposure to China in the near future, which is seen as a competitive advantage [79][80]

Financial Data and Key Metrics Changes - In Q2, net sales decreased by 6%, while organic net sales decreased by 4.6% when excluding unfavorable foreign exchange impacts [20][35] - Adjusted EBITDA was $71.3 million, a decline of $24 million compared to the previous year, primarily due to lower sales volumes and increased brand-focused investments [22][36] - Gross margins decreased by 60 basis points to 37.5%, driven by lower volume, higher trade promotions, and inflation [22][35] Business Line Data and Key Metrics Changes - Global Pet Care reported a 7.1% decrease in net sales, with organic sales down 6.3%, affected by softness in both companion animal and aquatics categories [39][46] - Home and Garden net sales decreased by 5.2%, primarily due to timing shifts in retailer inventory builds [46][47] - Home and Personal Care saw a 5.1% decrease in reported net sales, with organic net sales down 2.2%, driven by softness in North America [53][58] Market Data and Key Metrics Changes - Consumer sentiment in the U.S. weakened, impacting category growth, with consumers seeking value amid economic uncertainty [21][22] - EMEA organic sales for Global Pet Care grew mid-single digits, while North American sales declined, particularly in premium segments [42][54] - Latin America experienced low double-digit growth in organic net sales, driven by strong new product launches [56] Company Strategy and Development Direction - The company is focused on protecting its balance sheet and generating free cash flow, targeting approximately $160 million for the year [24][61] - Plans to transition sourcing out of China are underway, with expectations to have 100% of Home and Garden sourced outside of China by the end of the calendar year [71][72] - The company aims to leverage its strong balance sheet for potential acquisitions in the pet category, positioning itself as a consolidator in the market [27][66] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the current tariff environment and emphasized the importance of maintaining liquidity and a strong balance sheet [18][74] - The company anticipates challenges in the Home and Personal Care segment but expects to emerge stronger due to its strategic initiatives [70][72] - Management highlighted the potential for strategic acquisitions as asset prices reset in the current economic climate [66][73] Other Important Information - The company repurchased approximately 2 million shares during the second quarter, continuing its disciplined approach to share repurchases [30][31] - The company does not have sufficient visibility to provide an earnings framework for fiscal 2025 due to the unpredictable nature of global trade negotiations [32][61] Q&A Session Summary Question: Are there areas where the company sees itself competitively advantaged in sourcing? - Management indicated that while the tariff situation presents challenges, the company is well-positioned to reduce its exposure to China and has a competitive advantage due to its scale and strong relationships with suppliers [80][84] Question: Can the company frame the gross impact of tariffs and mitigation actions? - Management stated that while it is difficult to provide absolute numbers, the company has pivoted its operating strategy and stopped ordering from China, which will mitigate the gross impact of tariffs [88]

Financial Data and Key Metrics Changes - Net sales increased by 1.2%, with organic net sales up 1.9% excluding unfavorable foreign exchange impacts [9][27] - Adjusted EBITDA was $77.8 million, a decrease of 7.7% driven by prior year investment income and increased brand-focused investments [29] - Gross margins improved by 140 basis points to 36.8%, supported by cost improvements and operational efficiencies [28] Business Line Data and Key Metrics Changes - Global Pet Care reported a net sales decrease of 6.1%, with organic sales down 6.4% due to a strategic pull forward of sales from the previous quarter [31] - Home and Garden net sales increased by 27.9%, driven by seasonal inventory builds and a warm fall season [38] - Home and Personal Care saw reported net sales increase by 1.4%, with organic net sales up 3.1% [44] Market Data and Key Metrics Changes - E-commerce sales accounted for over 30% of Home and Personal Care's quarterly global sales, significantly outpacing brick-and-mortar sales [44] - In North America, consumer trade downs impacted premium brands in the pet category, leading to low double-digit sales declines [33] - EMEA markets experienced high single-digit growth in both personal care and home appliances, with strong e-commerce performance [45] Company Strategy and Development Direction - The company is focusing on brand-driven investments to drive long-term growth, particularly in advertising, marketing, and R&D [14] - Strategic investments are being made in inventory to support sales growth, especially in e-commerce [15] - The company is actively working to mitigate tariff impacts by moving production out of China and redesigning supply chains [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the start of fiscal 2025, highlighting strong operational performance and healthy inventory levels [55] - The company anticipates cautious consumer behavior due to the evolving international trade environment and potential price implications [53] - Future sales growth is expected to be low single digits, driven by brand-building investments despite geopolitical and economic pressures [49] Other Important Information - The company repurchased approximately 800,000 shares in the first quarter, with a total of $1.2 billion returned to shareholders since the close of the HHI transaction [22][23] - The company plans to launch new products in the pet care segment, including health and wellness products, to capture market growth [16][90] Q&A Session Summary Question: Retailer commitment to the Home and Garden category - Management noted that retailers appear committed to the category, with incremental off-shelf seasonal space being allocated [61][66] Question: Potential delay in HPC business - Management acknowledged the delay but emphasized the importance of improving the business fundamentals and the potential for higher valuations in the future [70][72] Question: E-commerce growth in Global Pet Care - Management reported double-digit growth in POS for e-commerce, despite some capacity issues with a major retailer impacting shipments [76][78] Question: M&A strategy and needs - Management has been evaluating numerous transactions but is cautious about price points, focusing on organic growth and maintaining discipline in M&A [87][90] Question: Tariff impacts and competitive dynamics - Management highlighted the limited tariff impact on Home and Garden and the ongoing efforts to reduce exposure in the HPC segment [95][98]