Financial Data and Key Metrics Changes - In Q4, the company achieved organic net sales growth of 2.5%, aligning with expectations despite external pressures [7][22] - Adjusted gross margin rate decreased by 330 basis points, primarily due to unexpected year-end inventory adjustments and increased trade promotions [27][28] - Adjusted operating income was $40.3 million, representing 7.5% of net sales, down from 10.8% in the previous year [28] Business Line Data and Key Metrics Changes - International organic net sales grew by 6.9%, driven by volume and price gains across all segments [22] - North America experienced a decline in organic net sales by 60 basis points, with wet shave sales down approximately 1% [23] - Sun and skin care organic net sales increased by approximately 11%, with robust growth across each business segment [24] Market Data and Key Metrics Changes - International markets, representing about 40% of global sales, delivered strong growth for the fourth consecutive year, with Europe achieving its third straight year of growth [8][9] - The U.S. razor and blades category saw consumption down by 80 basis points, although market share improved sequentially [23] - The Billie brand achieved a 90 basis point share growth, now holding a 15% share at Walmart and 13% at Target [24] Company Strategy and Development Direction - The company plans to divest its feminine care business to focus on core categories with competitive advantages, including shave, sun, and skincare [6][19] - A multi-year innovation roadmap is being implemented, with significant investments in brand building and marketing to restore brand equity [11][14] - The transformation plan aims to simplify the U.S. structure, enabling faster decision-making and increased investment in growth capabilities [12][15] Management's Comments on Operating Environment and Future Outlook - The management acknowledged a challenging fiscal 2025 due to external pressures like tariffs and geopolitical tensions, but expressed confidence in the foundation for future growth [8][19] - For fiscal 2026, the company anticipates a return to organic net sales growth, driven by mid-single-digit growth in international markets and stabilization in North America [16][33] - The macro environment is expected to remain challenging, with muted category growth and cautious consumer spending [15][16] Other Important Information - The company generated productivity savings of 270 basis points in fiscal 2025, with expectations of approximately 310 basis points in fiscal 2026 [10][30] - Adjusted EBITDA for fiscal 2026 is projected to be in the range of $290 million to $310 million, approximately flat to the prior year [37] - The divestiture of the feminine care business is expected to impact adjusted EPS by approximately $0.40 to $0.50 annually [32] Q&A Session Summary Question: Outlook and EPS Expectations - The company expects a balanced and achievable plan for 2026, with low single-digit category growth assumptions and flexibility to maintain profit goals [41][43] Question: Strategy and M&A Intentions - The focus is on winning in shave, grooming, sun, and skin categories, with potential for M&A as asset values decline [51][53] Question: Productivity and Gross Margin Concerns - The company is confident in its second-half-oriented plan, expecting higher sales growth and productivity improvements to offset margin pressures [63][64] Question: Sun and Skin Category Insights - The company plans conservatively for the sun season, expecting low single-digit growth while focusing on brand campaigns and distribution gains [81][84]

Financial Data and Key Metrics Changes - In Q4 2025, the company achieved organic net sales growth of 2.5%, aligning with expectations despite external pressures [7][22] - Adjusted gross margin rate decreased by 330 basis points, primarily due to unexpected year-end inventory adjustments and increased trade promotions [26][28] - Adjusted operating income was $40.3 million, representing 7.5% of net sales, down from 10.8% the previous year [28] Business Line Data and Key Metrics Changes - International organic net sales grew by 6.9%, driven by volume and price gains across all segments [22] - North America experienced a decline in organic net sales by 60 basis points, with wet shave sales declining approximately 1% [23] - Sun and skin care organic net sales increased by approximately 11%, with robust growth across each business segment [24] Market Data and Key Metrics Changes - International markets, representing about 40% of global sales, delivered strong growth for the fourth consecutive year, with Europe achieving its third straight year of growth [8][9] - The U.S. razor and blades category saw consumption down by 80 basis points, although market share improved sequentially [23] - The Billie brand achieved a 90 basis point share growth, indicating strong retail performance [24] Company Strategy and Development Direction - The company plans to divest its feminine care business to focus on core categories with competitive advantages, including shave, sun, and skincare [6][20] - A multi-year innovation roadmap is being implemented, with significant investments in brand building and marketing to restore brand equity [11][14] - The transformation plan aims to simplify the U.S. structure, enhance decision-making speed, and increase investment in growth capabilities [12][15] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a challenging fiscal 2025 due to external pressures like tariffs and geopolitical tensions, but expressed optimism about durable international growth and innovation [8][20] - The outlook for fiscal 2026 anticipates a return to organic net sales growth, driven by mid-single-digit growth in international markets and stabilization in North America [16][34] - The company expects to face continued inflation and tariff impacts but is focused on productivity gains and margin recovery [16][36] Other Important Information - The company declared a quarterly dividend of $0.15 per share for Q4 and completed approximately $90 million in share repurchases for the fiscal year [29] - The anticipated divestiture of the feminine care business is expected to impact adjusted EPS by approximately $0.40-$0.50 annually [32] Q&A Session Summary Question: Outlook and EPS Expectations - The company expects a balanced and achievable plan for 2026, with EPS potentially at a loss in Q1 due to margin pressures and tax rate changes [40][41] Question: Strategy and Portfolio Focus - The strategy focuses on winning in shave, grooming, sun, and skin categories, with plans for potential M&A as asset values decline [45][46] Question: Productivity and Gross Margin Concerns - Management expressed confidence in the second-half-oriented plan, expecting higher sales growth and productivity improvements to enhance gross margin [50][52] Question: Use of Proceeds from Divestiture - Proceeds from the feminine care sale will primarily be used for debt reduction, with a focus on maintaining a disciplined capital allocation strategy [54][55] Question: Sun and Skin Category Outlook - The company plans conservatively for the sun category, expecting low single-digit growth while investing in brand campaigns for Hawaiian Tropic and Banana Boat [57][58]

Core Insights - Not all cash-generating companies are successful; some fail to reinvest effectively, limiting growth potential [1] - StockStory aims to identify companies with genuine upside potential [1] Companies to Sell - **Elastic (ESTC)** - Trailing 12-Month Free Cash Flow Margin: 20.2% [2] - Current stock price is $88.32, with a forward price-to-sales ratio of 5.3x [4] - **Edgewell Personal Care (EPC)** - Trailing 12-Month Free Cash Flow Margin: 1.9% [5] - Current stock price is $18.53, with a forward P/E ratio of 6.4x [7] Company to Watch - **Laureate Education (LAUR)** - Trailing 12-Month Free Cash Flow Margin: 15.6% [8] - Estimated sales growth of 12.5% for the next 12 months, indicating a slowdown from previous trends [8] - Operating margin increased by 7.7 percentage points over the last year [8] - Free cash flow margin expected to decrease by 2.4 percentage points in the coming year [8] Performance Concerns - **Laureate Education (LAUR)** - Organic revenue has underperformed over the past two years, suggesting a need for acquisitions to stimulate growth [9] - Earnings per share declined by 2.6% annually over the last three years, with flat revenue indicating reduced profitability per sale [9] - Free cash flow margin decreased by 4.9 percentage points over the last year due to increased investments [9] Positive Aspects - **Laureate Education (LAUR)** - Strong operating margin of 23.5% over the past two years due to disciplined cost controls [11] - Free cash flow generation is superior to most peers, enabling exploration of new investment opportunities [11] - Increasing returns on capital as previous investments begin to yield results [11]

Core Viewpoint - Edgewell Personal Care Company is set to report its financial results for the fourth quarter and fiscal year 2025 on November 13, 2025, before market opening, with a conference call scheduled for the same day to discuss the results [1]. Company Overview - Edgewell Personal Care is a leading pure-play consumer products company with a diversified portfolio of established brands, including Schick®, Wilkinson Sword®, Billie®, Edge®, Skintimate®, Playtex®, Stayfree®, Carefree®, o.b.®, Banana Boat®, Hawaiian Tropic®, Bulldog®, Jack Black®, Cremo®, and Wet Ones® [2]. - The company operates in over 50 markets globally, including the U.S., Canada, Mexico, Germany, Japan, the U.K., and Australia, employing approximately 6,700 people worldwide [2]. Recent Developments - Edgewell Personal Care announced a new leadership structure aimed at streamlining operations and enhancing efficiency, with the departure of Chief Operating Officer Dan Sullivan effective October [3]. - The company has been recognized as the 1 employer in Connecticut on Forbes America's Best-In-State Employers 2025 list, highlighting its strong employer brand [4].

Edgewell Personal Care Company (EPC) FY Conference Summary Company Overview - **Company**: Edgewell Personal Care Company (EPC) - **Date of Conference**: August 12, 2025 - **Key Speakers**: Dan Sullivan (COO), Fran Wiseman (CFO) Key Points Transformation and Business Strengths - **Transformation Status**: Company is in a transformation phase amidst challenges such as COVID, inflation, and tariffs [4][8] - **International Business**: Accounts for approximately 40% of revenue, with a 6-7% CAGR over the last four years, projected to grow by 45% this year [5] - **Innovation**: Significant improvements in innovation structure, with successful launches in international markets, including Hawaiian Tropic in Mexico and Bulldog in the UK [6][7] - **Productivity Savings**: Historical savings of 250-300 basis points annually, with expectations to continue this trend [8] - **Cash Flow**: Average free cash flow projected between $150 million to $180 million [8] Areas for Improvement - **U.S. Market Focus**: The company is working on enhancing its U.S. operations, including hiring a new President of North America and reorganizing the commercial business [9] - **Top-Line Growth**: Long-term growth target remains at 2-3%, with international markets expected to outperform the U.S. [12][14] Recent Performance and Market Conditions - **Q3 Challenges**: The sun care segment faced difficulties due to poor weather, impacting nearly a third of the business [17][18] - **Market Share Gains**: Despite challenges, 80% of international business held or gained market share, with notable performance from brands like Hawaiian Tropic and HydroSilk [19][21] - **Q4 Outlook**: Anticipated organic growth of approximately 22.5%, with international growth expected to be around 8% [22] Consumer Health and Competitive Landscape - **Consumer Sentiment**: No signs of consumer hesitancy or trade-down to private labels observed, with categories growing at 3-4% [24][25] - **Competitive Environment**: The U.S. market remains competitive, particularly in women's grooming, but the company is well-positioned with its diverse portfolio [56][59] Financial Metrics and Projections - **Gross Margin**: Historically strong, with a slight decline in 2025 due to tariffs and currency impacts, but expected to recover [27][29] - **Tariff Impact**: Estimated annual exposure to tariffs is between $40 million to $50 million, representing 3-4% of COGS [31] - **Free Cash Flow**: Expected to deliver around $80 million in 2025, down from historical levels due to various headwinds [38][39] Strategic Focus and Future Outlook - **Capital Allocation**: Focus on debt paydown and share repurchases, with a goal to reduce debt leverage to around three times [41][42] - **Brand Performance**: Hawaiian Tropic is performing well, while Banana Boat is stable but affected by weather conditions [43][44] - **Grooming Segment Growth**: The grooming portfolio has grown to represent about 10% of total business, with brands like Bulldog and Cremo showing strong performance [61] Conclusion - **Future Prospects**: The company is optimistic about its transformation efforts, strong cash flow, and the potential for growth in both international markets and the U.S. [64][65]

Financial Data and Key Metrics Changes - Organic net sales decreased by 1.5% in Q2 2025, with international markets growing by 3% while North America declined by 4% [22][36] - Adjusted gross margin rate increased by 100 basis points, with productivity savings of approximately 380 basis points [37][30] - Adjusted earnings per share were $0.87, slightly down from $0.88 in the prior year quarter [38] Business Line Data and Key Metrics Changes - Wet Shave organic net sales were down about 1%, while international Wet Shave grew by 3% [24] - Grooming organic net sales increased by 9%, led by a 20% growth for the Cremo brand [28] - Fem Care organic net sales decreased by approximately 9%, primarily driven by declines in tampons and pads [29] Market Data and Key Metrics Changes - Consumption in the U.S. Sun Care category decreased by 1% in the quarter, with total market share down by 60 basis points [27] - Double-digit organic growth was observed in Greater China, with mid-single-digit growth in Japan and Europe [22] - The U.S. razors and blades category saw a consumption decline of 30 basis points, with market share decreasing by 90 basis points [25] Company Strategy and Development Direction - The company is focused on restoring momentum in North America, with significant investments in sun care and women's shave categories [12][33] - A new campaign for Hawaiian Tropic is set to be the largest investment in the U.S. in five years, targeting Gen Z consumers [34] - The company aims to leverage recent successes in international markets to replicate growth in North America [13] Management's Comments on Operating Environment and Future Outlook - Management noted increasing pressure on consumers and a decline in consumer confidence, impacting spending behaviors [17][14] - The outlook for the second half of the fiscal year anticipates a modest growth profile, with organic net sales growth expected to be flat to 1% [41] - Management expressed confidence in sequential improvement in North America, driven by new leadership and strategic initiatives [14][75] Other Important Information - The estimated impact of tariffs on cost of goods sold for fiscal 2025 is approximately $3 million to $4 million [43] - The company plans to continue exploring opportunities to mitigate tariff impacts through productivity and potential price increases [92][93] - Free cash flow for the full year is now expected to be in the range of $130 million to $140 million, reflecting lower earnings and higher inventory levels [45] Q&A Session Summary Question: Can you provide more details on the tariff impact? - The estimated in-year impact of tariffs is $3 million to $4 million, primarily affecting the fourth quarter, with a broader annualized exposure of 3% to 4% of COGS [50][52] Question: What is the confidence level for second half organic sales growth? - The company expects a 2% organic growth in the second half, driven by international growth, Sun Care category growth, and a more thoughtful approach to fem care [62][64] Question: How does the company view the North American execution? - Management clarified that while sales did not meet expectations, they are confident in execution and are investing in key programs for improvement [76][78]