Financial Data and Key Metrics Changes - The company reported a free cash flow of approximately $242 million for the previous year, with an outlook of over $245 million for the current year, indicating a strong financial profile and consistent cash generation [9][48]. - The five-year compound annual growth rates (CAGRs) showed revenue growth of about 3.5%, organic growth of 2.5%, and earnings per share (EPS) growth of nearly 9% [11]. Business Line Data and Key Metrics Changes - The company operates in several categories, with gastrointestinal (GI) being the largest, followed by women's health, eye and ear care, skin care, and analgesics [4][5]. - The company has a diverse portfolio that allows it to manage fluctuations in illness levels effectively, with brands performing variably based on market conditions [6][10]. Market Data and Key Metrics Changes - The e-commerce segment has grown significantly, with online sales increasing from about 4% of total sales five years ago to approximately 16% by the end of the last fiscal year, with two-thirds of that attributed to Amazon [24][25]. - The international business, particularly in Australia, has been growing in the mid-teens, exceeding long-term expectations of mid to high single-digit growth [36]. Company Strategy and Development Direction - The company focuses on investing in niche categories where brands can compete effectively, emphasizing a brand-building playbook that includes understanding consumer insights and agile marketing strategies [2][12]. - The company aims to utilize its strong cash flow for mergers and acquisitions (M&A), share repurchases, and maintaining a low leverage ratio, with a preference for M&A as the primary use of cash [41][42]. Management's Comments on Operating Environment and Future Outlook - Management acknowledged capacity constraints affecting certain brands but expressed confidence in addressing these issues through new supplier agreements and operational adjustments [46][48]. - The company maintains its free cash flow outlook despite adjustments to top-line revenue expectations, indicating resilience in its financial performance [48]. Other Important Information - The company has a disciplined approach to M&A, focusing on acquiring brands with leading positions in niche categories, and has significant acquisition capacity without returning to previous high leverage levels [44][45]. - The company has successfully launched several new products, including Dramamine advanced herbals for kids and Summer's Eve whole body deodorant, which have performed well in their respective markets [31][33]. Q&A Session Summary Question: What are the kind of valuations the company is seeing in the market? - The company has not observed a meaningful shift in valuations for the types of brands it seeks, emphasizing its competitive advantages over private equity in terms of cost of capital and operational sophistication [58][59]. Question: How does the company view the shift in retail channels from traditional drugstores to clubs and retailers? - The company has adapted to channel shifts by developing unique programs for each retail partner and remains committed to supporting brands in the drug channel while also leveraging opportunities in e-commerce and other retail formats [60][62].

Financial Performance & Strategy - FY25 revenues reached $1,137.8 million[69] - The company achieved a 5-year revenue CAGR of 34%[17,69] - Adjusted EPS 5-year CAGR was +88%[17] - Organic revenue 5-year CAGR was +24%[17,69] - Adjusted FY25 Free Cash Flow reached $243291 thousand[49,75] - Net leverage was significantly reduced to 24x[49] - The company anticipates approximately $1 billion total Free Cash Flow over the next four years[51] E-commerce & International Expansion - E-commerce as a percentage of net sales has increased +4x from approximately 4% in FY19 to approximately 16% in FY25[33] - International revenue accounts for approximately 16% of Prestige Net Sales in FY25[45] FY26 Outlook - Expected revenue for FY26 is projected to be between $1,100 to $1,115 million[59] - Projected FY26 Non-GAAP Free Cash Flow is $245 million[59,77]

Core Insights - Prestige Consumer Healthcare's long-term growth strategy focuses on building strong brands and expanding its brand portfolio through both organic growth and acquisitions [1][10] - The company has seen significant momentum in e-commerce, with sales growing at a double-digit rate and e-commerce now representing a high-teens percentage of total sales, up from approximately 15% the previous year [7][8] - Despite solid revenue growth forecasts, the company faces challenges from long-term debt of $1.01 billion and currency fluctuations that could impact profitability [8][11][12] Financial Performance - Prestige Consumer's stock has increased by 30.9% over the past year, outperforming the industry and S&P 500, both of which grew by 9.1% [2] - The company has a market capitalization of $4.23 billion and an earnings yield of 5.6%, significantly higher than the industry's 0.6% yield [2] - The Zacks Consensus Estimate for fiscal 2026 earnings per share is $4.77, with revenues projected at $1.15 billion, indicating a 0.9% increase from the previous year [13] Brand and Product Strategy - The company emphasizes targeted brand-building and innovation, particularly in niche consumer healthcare categories, which supports its market share leadership [4] - Recent product innovations include new flavors for Hydralyte and the Monistat Maintain Kit, aimed at enhancing consumer engagement [5][10] - Acquisitions, such as TheraTears and Hydralyte, have diversified the product portfolio, providing multiple growth sources and minimizing the impact of category-specific slowdowns [10] E-Commerce and Digital Strategy - E-commerce sales growth is driven by brand-specific digital strategies, including website refreshes and engaging content, which enhance consumer education and retention [7][9] - The company is expanding its digital channels internationally while maintaining strong profitability across all sales channels [8][9] Debt and Currency Risks - Prestige Consumer's long-term debt of $1.01 billion and a cash position of $98 million indicate a moderately leveraged debt-to-capital ratio of 35.6% [11] - Currency fluctuations pose a risk, as approximately 15.6% of revenues come from international markets, potentially affecting pricing and costs [12]

Core Viewpoint - Prestige Consumer (PBH) has shown strong momentum with a 35.7% increase in share price over the past year, outperforming the industry growth of 7.9% and the S&P 500's 9.3% increase, indicating solid fundamentals and growth opportunities for investors [1] Company Overview - Prestige Consumer develops, manufactures, markets, sells, and distributes over-the-counter (OTC) healthcare and household cleaning products across the United States, Canada, Australia, and other international markets, including e-commerce channels [2] - The company operates through two segments: North American OTC Healthcare and International OTC Healthcare, with major brands including BC, Goody's, Chloraseptic, and Dramamine [3] Factors Favoring Share Price Growth - The upward trend in PBH's share price is supported by a diverse portfolio of well-recognized consumer brands, with significant contributions from the Gastrointestinal (GI) and Women's Health categories in fiscal 2025 [4] - The company is experiencing impressive growth in the e-commerce channel, reflecting a long-term trend of increasing online purchases [4] - Strategic acquisitions, including TheraTears and Hydralyte, are viewed positively by investors, enhancing PBH's product offerings in the VMS and Cough & Cold categories [5] - PBH's focus on brand building and product innovation has allowed its brands to maintain a leading market share, with Hydralyte's expansion into international markets exemplifying this strategy [6] Market Position and Brand Strength - The Fleet brand, a leader in the rectal laxative category, holds over 50% market share and is expanding into adjacent categories [7] - The women's health franchise is represented by leading brands Monistat and Summer's Eve, contributing to PBH's strong market position [7] Financial Estimates - The Zacks Consensus Estimate for PBH's fiscal 2026 EPS has increased by 0.2% to $4.77, with an earnings yield of 5.6% compared to the industry's 0.6% [11]

Financial Data and Key Metrics Changes - The company reported net revenue of over $1,100,000,000 for fiscal year 2025, an increase of just over 1% compared to the prior year [6][7] - Adjusted EPS for the year was $4.52, up approximately 7% from the previous year [7][23] - Q4 revenue reached $296,500,000, a 7% increase year-over-year, with adjusted diluted EPS of $1.32, up from $1.20 in the prior year [18][19] Business Line Data and Key Metrics Changes - The North America segment saw broad-based growth, particularly in the women's health and GI categories, with brands like Summer's Eve and Dramamine performing well [18][20] - The international segment grew by 7.1% excluding foreign exchange impacts, driven by the Hydralyte brand [18][20] - E-commerce sales continued to grow at a double-digit rate, now representing high teens as a percentage of total sales [20][21] Market Data and Key Metrics Changes - The international segment experienced solid growth, particularly in Australia, contributing to overall performance [20] - E-commerce remains the fastest-growing channel, with shipment growth accelerating in Q4 [20][21] Company Strategy and Development Direction - The company emphasizes a diversified portfolio of brands to navigate market challenges and capitalize on growth opportunities [6][28] - A disciplined capital allocation strategy is in place, focusing on M&A opportunities, share repurchases, and maintaining cash reserves for future investments [25][26] - The company plans to continue leveraging its marketing agility to adapt to changing consumer preferences and market conditions [8][62] Management's Comments on Operating Environment and Future Outlook - Management highlighted ongoing challenges from tariffs, supply chain constraints, and inflation, which could impact consumer spending [5][28] - The outlook for fiscal 2026 anticipates revenues between $1,000,000,001.40 and $1,000,000,001.55, with organic growth expected at 1% to 2% [31][32] - The company expects to maintain gross margin expansion despite tariff impacts, projecting a gross margin of approximately 56.5% [21][33] Other Important Information - The company generated $243,000,000 in free cash flow for fiscal 2025, up approximately 2% from the prior year [24] - The leverage ratio improved to 2.4 times, providing strategic flexibility for capital deployment [25][26] Q&A Session Summary Question: Organic sales growth guidance of 1% to 2% - Management acknowledged macroeconomic volatility and the timing of e-commerce orders as factors influencing the guidance [35][36] Question: Recovery expectations for Clear Eyes - Management confirmed plans to expand capacity with existing suppliers and bring on new suppliers, expecting recovery in the second half of fiscal 2026 [39][41] Question: Women's health category growth outlook - Management expressed confidence in the growth of Summer's Eve and Monistat, citing successful marketing and new product launches [45][47] Question: Capital allocation strategy with reduced leverage - Management indicated a balanced approach to capital allocation, focusing on M&A opportunities while also considering share repurchases [52][54] Question: Consumer uncertainty and marketing plans - Management plans to adapt marketing strategies based on evolving consumer preferences, emphasizing the importance of needs-based products [60][62] Question: Tariff impacts and cost-saving measures - Management confirmed the $15,000,000 tariff headwind and outlined plans to mitigate costs through supplier collaboration and potential pricing adjustments [64][66] Question: E-commerce growth internationally - Management noted that e-commerce growth is primarily US-centric, with less growth observed in other markets [68] Question: Opportunities for domestic suppliers - Management is exploring opportunities for domestic sourcing to mitigate tariff impacts, particularly from China [74][76] Question: Innovation and new product launches - Management indicated a steady approach to innovation, focusing on margin-accretive products without targeting a specific percentage of sales from new products [78][80]

Financial Data and Key Metrics Changes - The company reported net revenue of over $1,100 million, an increase of just over 1% compared to the prior year [6] - Adjusted EPS reached $4.52, up approximately 7% year-over-year [7][23] - Total company gross margin was 55.8% for fiscal 2025, up 30 basis points from the prior year, with Q4 gross margin improving to approximately 57% [21] Business Line Data and Key Metrics Changes - North America segment revenues increased by 30 basis points, while international segment revenues grew by 6.4% [20] - The women's health category, particularly the Summer's Eve brand, showed stabilization and growth, marking the second consecutive quarter of year-over-year sales growth [6][20] - The GI category, led by brands like Dramamine and Fleet, continued to experience strong performance [6][20] Market Data and Key Metrics Changes - The international segment experienced growth in excess of 5%, driven by strong performance in Australia, particularly with the Hydralyte brand [20] - E-commerce sales grew at a double-digit rate, now representing high teens as a percentage of total sales [20] Company Strategy and Development Direction - The company emphasized a disciplined capital allocation strategy, focusing on M&A opportunities, share repurchases, and building cash reserves [26] - A multi-year pipeline of new product development is in place to ensure continuous innovation and meet consumer needs [13][15] - The company plans to leverage its diverse and predominantly domestic supplier base to navigate tariff impacts and inflationary pressures [31] Management's Comments on Operating Environment and Future Outlook - Management acknowledged heightened market volatility and consumer uncertainty due to tariffs and inflation, but expressed confidence in the company's ability to navigate these challenges [29][30] - For fiscal 2026, the company anticipates revenues between $1,000 million and $1,055 million, with organic growth forecasted at approximately 1% to 2% [32] Other Important Information - The company generated $243 million in free cash flow for fiscal 2025, up approximately 2% from the prior year [24] - The company plans to maintain a gross margin of approximately 56.5% for both fiscal 2026 and Q1 [21] Q&A Session Summary Question: Clarification on organic sales growth guidance - Management indicated that the guidance reflects macroeconomic uncertainties and the timing of e-commerce orders, which were pulled forward [36][37] Question: Recovery expectations for Clear Eyes - Management confirmed ongoing supply chain plans to expand capacity and expects a recovery in the second half of fiscal 2026 [40][41] Question: Outlook for women's health brands - Management expressed confidence in the growth potential of Summer's Eve and Monistat, supported by successful marketing and new product launches [46][48] Question: Capital allocation strategy and M&A opportunities - Management highlighted a balanced approach to capital allocation, focusing on M&A opportunities while also considering share repurchases [52][55] Question: Impact of consumer uncertainty on innovation and marketing - Management noted that needs-based categories tend to be resilient during economic uncertainty, and they will adapt marketing strategies to align with consumer preferences [60][62] Question: Tariff impacts and cost-saving measures - Management confirmed the $15 million tariff headwind and outlined plans to implement cost-saving measures while considering surgical pricing if necessary [64][66] Question: E-commerce growth internationally - Management stated that e-commerce growth remains primarily US-centric, with less growth observed in other markets [68] Question: Opportunities for domestic suppliers - Management is exploring opportunities for domestic sourcing to mitigate tariff impacts, particularly concerning products sourced from China [74][75] Question: Innovation pipeline and margin profile - Management indicated a steady impact from new products and emphasized that all innovations must be margin-accretive [77][79]

Core Insights - Prestige Consumer Healthcare Inc. reported strong financial results for the fourth quarter and fiscal year ended March 31, 2025, with record sales driven by international business strength and eCommerce growth [2][3][6] - The company achieved a 7.0% increase in fourth-quarter revenues to $296.5 million compared to $277.0 million in the same quarter of the previous year, with a 7.9% organic revenue growth [3][8] - Fiscal year 2025 revenues totaled $1,137.8 million, reflecting a 1.1% increase from $1,125.4 million in fiscal year 2024, with notable growth in the Gastrointestinal category [6][7] Financial Performance - Fourth-quarter net income was reported at $50.1 million, up from $49.5 million in the prior year, with diluted earnings per share (EPS) of $1.00 compared to $0.98 [4][7] - For fiscal year 2025, net income reached $214.6 million, an increase from $209.3 million in the previous year, with diluted EPS of $4.29 compared to $4.17 [7][8] - Non-GAAP adjusted net income for the fourth quarter was $65.9 million, up from $51.4 million in the prior year, leading to an adjusted diluted EPS of $1.32 compared to $1.02 [4][8] Segment Performance - North American OTC Healthcare segment revenues for the fourth quarter were $248.9 million, a 7.7% increase from $231.1 million in the prior year, driven by growth in GI and Women's Health categories [13][14] - International OTC Healthcare segment revenues for the fourth quarter were $47.6 million, a 3.7% increase from $45.9 million in the prior year, with strong performance from the Hydralyte brand [15][16] Cash Flow and Capital Allocation - The company generated $61.8 million in net cash from operating activities in the fourth quarter, down from $66.9 million in the prior year, with non-GAAP free cash flow of $58.4 million compared to $63.8 million [10][11] - For fiscal year 2025, net cash provided by operating activities was $251.5 million, slightly up from $248.9 million in the previous year, with non-GAAP free cash flow increasing by 1.6% to $243.3 million [11][12] Outlook - The company anticipates organic revenue growth of approximately 1% to 2% and diluted EPS in the range of $4.70 to $4.82 for fiscal year 2026, despite facing inflationary pressures from tariffs [17][18] - The initial revenue outlook for fiscal 2026 is projected between $1,140 million and $1,155 million, with free cash flow expected to exceed $245 million [18]

Core Insights - Prestige Consumer Healthcare Inc. reported strong financial results for the fourth quarter and fiscal year ended March 31, 2025, with record sales driven by international business strength and eCommerce growth [2][3][6]. Financial Performance - Fourth quarter revenues reached $296.5 million, a 7.0% increase from $277.0 million in the same quarter of the previous year, with a 7.9% increase when excluding foreign currency impacts [3][6]. - Fiscal year 2025 revenues totaled $1,137.8 million, up 1.1% from $1,125.4 million in fiscal year 2024, with a 1.2% increase excluding foreign currency effects [6][7]. - Net income for the fourth quarter was $50.1 million, compared to $49.5 million in the prior year, while diluted earnings per share (EPS) increased to $1.00 from $0.98 [4][7]. - For fiscal year 2025, reported net income was $214.6 million, up from $209.3 million, with diluted EPS rising to $4.29 from $4.17 [7][8]. Segment Performance - North American OTC Healthcare segment revenues for Q4 were $248.9 million, a 7.7% increase from $231.1 million in the prior year, driven by growth in GI and Women's Health categories [13][14]. - International OTC Healthcare segment revenues for Q4 were $47.6 million, a 3.7% increase from $45.9 million, with significant growth attributed to the Hydralyte brand [15][16]. Cash Flow and Capital Allocation - The company generated $61.8 million in net cash from operating activities in Q4, down from $66.9 million in the prior year, while non-GAAP free cash flow was $58.4 million, a decrease from $63.8 million [10][11]. - For the fiscal year, net cash provided by operating activities was $251.5 million, slightly up from $248.9 million, with non-GAAP free cash flow increasing by 1.6% to $243.3 million [11][12]. Shareholder Returns and Debt Management - The company repurchased approximately 0.7 million shares for about $51.5 million during fiscal 2025, reducing net debt to approximately $0.9 billion, resulting in a leverage ratio of 2.4x [12][18]. - The company plans to maintain a disciplined capital allocation approach, focusing on share repurchases, M&A, and deleveraging [2][8]. Fiscal 2026 Outlook - The company anticipates organic revenue growth of approximately 1% to 2% and diluted EPS in the range of $4.70 to $4.82 for fiscal 2026, despite facing inflationary headwinds from tariffs [17][18].

Core Insights - Prestige Consumer Healthcare (PBH) is focused on brand building and portfolio expansion through strategic acquisitions, which is expected to drive growth in upcoming quarters [1][5] - The company has experienced a share price increase of 19.3% over the past year, outperforming the industry and S&P 500 [1] Company Overview - PBH has a market capitalization of $4.17 billion and reported an earnings surprise of 5.17% in the last quarter [2] - The earnings yield for PBH stands at 5.4%, significantly higher than the industry's 0.3% [2] Growth Drivers - The strength of PBH's diversified portfolio, which includes well-recognized consumer brands, has contributed to sales growth and long-term profitability, with core brands generating nearly 58.6% of total revenues in fiscal 2024 [3] - The gastrointestinal (GI) product category is a significant contributor, accounting for nearly 20% of North American sales, with brands like Dramamine, Fleet, and Gaviscon leading the category [4] - The company is also seeing growth in the e-commerce channel, reflecting a long-term trend towards online purchases [4] Strategic Acquisitions - PBH has expanded its brand portfolio through both organic growth and acquisitions, including the purchase of TheraTears and other over-the-counter brands from Akorn Operating Company LLC, as well as Hydralyte from Hydration Pharmaceuticals Trust [5] Financial Concerns - As of the end of the fiscal third quarter, PBH had a long-term debt of $996 million and cash and cash equivalents of $51 million, with a debt-to-capital ratio of 35.8% [7] - The company generated approximately 14.8% of its fiscal 2024 revenues from international business, making it susceptible to currency fluctuations [9] Earnings Estimates - The Zacks Consensus Estimate for PBH's fiscal 2025 earnings per share has increased by 0.4% to $4.52, with revenue estimates at $1.13 billion, reflecting a 0.5% increase from the previous year [10]