Attached files
| file | filename |
|---|---|
| 8-K - Prestige Consumer Healthcare Inc. | v192487_8k.htm |
| EX-99.2 - Prestige Consumer Healthcare Inc. | v192487_ex99-2.htm |
| EX-23.1 - Prestige Consumer Healthcare Inc. | v192487_ex23-1.htm |
Prestige
Brands Holdings, Inc. Reports Fiscal First Quarter 2011 Results
Irvington,
NY, August 5, 2010—Prestige Brands Holdings, Inc. (NYSE-PBH) today announced
results for the first quarter of fiscal 2011, which ended on June 30,
2010.
Net
income from continuing operations for the first quarter was $9.6 million, or
$0.19 of fully diluted earnings per share, 20% higher than the prior year’s
comparable period’s net income of $8.0 million or $0.16 per fully diluted
share.
Total
revenues for the quarter ended June 30, 2010 were $73.4 million, 3% higher than
the prior year comparable quarter’s results of $71.0 million.
Operating
income for the first fiscal quarter was $21.3 million, 15% higher than the prior
year’s comparable period results of $18.5 million. The increase in
operating income was due to an increase in gross profit resulting from higher
revenues combined with favorable advertising and promotion (A&P) and general
and administrative (G&A) expenditures.
Commentary
“This
quarter’s results affirm the strength of our core OTC business model and the
overall direction of our strategic plan,” said Matthew Mannelly, President and
CEO. “We are pleased with the growth of our core OTC brands as well
as their long-term potential. We remain confident in achieving our long-term
goals, however, we are realistic about the overall economic environment and the
challenges we face for the full year. In particular, given last years’ heavy
retailer buy-in of cough/cold products in anticipation of H1N1, the second
quarter will be challenging from a revenue standpoint. Retailers have
told us as well as our competitors that this buy-in will not be repeated this
year in the second quarter.”
Mr.
Mannelly concluded, “We continue to look at optimizing our growth portfolio as a
marathon, not a sprint. With our refinancing in place, we are focused on both
organic growth in our core OTC brands as well as pursuing appropriate outside
OTC opportunities.”
Results
by Segment for the First Fiscal Quarter
Over-the-Counter
Healthcare Products (OTC)
-1-
Net
revenues of $44.3 million for the OTC segment were $4.0 million or 10% higher
than the prior year comparable period results of $40.3 million. The
increase was driven by sales of Clear Eyes®, Compound W®, Wartner®, New Skin®,
Murine®
Tears, Percogesic®, and Sleep-Eze® in Canada, partially offset by decreases on
the Allergen Block products and Earigate®.
Of the
Company’s six core brands, five are in the OTC segment. These include
Chloraseptic®, Clear Eyes®, Compound W®, Little Remedies®, and The Doctor’s®
NightGuard®. Revenues for our core OTC brands were up 16% in the aggregate over
the prior year comparable quarter.
Household
Products
Revenues
for this segment were $26.5 million, 3% less than the comparable first quarter
of fiscal 2010. A sales increase on the Spic and Span® brand was
offset by declines on the Comet® and Chore Boy® brands.
Personal
Care Products
Revenues
for this segment were $2.6 million, 22% below the prior year comparable
quarter’s revenues of $3.3 million. The sales decline traces to
distribution losses for the Cutex® brand in the fall of 2010.
Free
Cash Flow
Free cash
flow is a “non-GAAP” measure as that term is defined by the Securities and
Exchange Commission in Regulation G. Free cash flow is presented here
because management believes it is a commonly used measure of liquidity, and is
an indication of cash available for debt repayment and
acquisitions. The Company defines free cash flow as operating cash
flows less capital expenditures.
The
Company’s free cash flow for the first quarter ended June 30, 2010 was $20.6
million, composed of operating cash flow of $20.7 million, less capital
expenditures of $0.1 million. This is a $2.6 million increase over
the comparable quarter’s free cash flow of $18.0 million, composed of operating
cash flow of $18.1 million, less capital expenditures of $0.1
million.
-2-
Conference
Call
The
Company will host a conference call today at 8:30 a.m. EDT. To access
the call, listeners calling from within North America may dial 800-299-0433 at
least 15 minutes prior to the start of the call. To access the call
from outside North America, callers should dial 617-801-9712. The
conference passcode is “prestige”. The Company will provide a live
internet webcast as well as an archived replay, which can be accessed from the
Investor Relations page of http://prestigebrandsinc.com. Telephonic
replays will be available for two weeks following the completion of the call and
can be accessed at 888-286-8010 within North America, and at 617-801-6888 from
outside North America. The passcode is 79554986.
About
Prestige Brands Holdings, Inc.
Located
in Irvington, New York, Prestige Brands Holdings, Inc. is a marketer and
distributor of brand name over-the-counter healthcare, household and personal
care products sold throughout the U.S., Canada and certain international
markets. Key brands include Compound W® wart remover, Chloraseptic®
sore throat and allergy treatment, New-Skin® liquid bandage, Clear Eyes® and
Murine® eye and ear care products, The Doctor’s® NightGuard® dental protector,
Little Remedies® pediatric over-the-counter products, Cutex® nail polish
remover, Comet® and Spic and Span® household products, and other well-known
brands.
Forward-Looking
Statements
Note:
This news release contains "forward-looking statements" within the meaning of
the federal securities laws and that are intended to qualify for the Safe Harbor
from liability established by the Private Securities Litigation Reform Act of
1995. "Forward-looking statements" generally can be identified by the use
of forward-looking terminology such as "assumptions," "target," "guidance,"
"outlook," "plans," "projection," "may," "will," "would," "expect," "intend,"
"estimate," "anticipate," "believe, "potential," or "continue" (or the negative
or other derivatives of each of these terms) or similar terminology. The
"forward-looking statements" include, without limitation, statements regarding
the Company’s future performance, liquidity, and borrowing capacity of
Prestige Brands Holdings. These statements are based on management's
estimates and assumptions with respect to future events and financial
performance and are believed to be reasonable, though are inherently uncertain
and difficult to predict. Actual results could differ materially from
those expected as a result of a variety of factors. A discussion of
factors that could cause results to vary is included in the Company's Annual
Report on Form 10-K and other periodic and other reports filed with the
Securities and Exchange Commission.
Contact:
Dean Siegal
914-524-6819
-3-
|
Three
Months Ended June 30
|
||||||||
|
(In
thousands, except share data)
|
2010
|
2009
|
||||||
|
Revenues
|
||||||||
|
Net
sales
|
$
|
72,706
|
$
|
70,395
|
||||
|
Other
revenues
|
719
|
617
|
||||||
|
Total
revenues
|
73,425
|
71,012
|
||||||
|
Cost
of Sales
|
||||||||
|
Cost
of sales (exclusive of depreciation shown below)
|
34,546
|
33,181
|
||||||
|
Gross
profit
|
38,879
|
37,831
|
||||||
|
Operating
Expenses
|
||||||||
|
Advertising
and promotion
|
7,598
|
8,765
|
||||||
|
General
and administrative
|
7,414
|
8,195
|
||||||
|
Depreciation
and amortization
|
2,547
|
2,345
|
||||||
|
Total
operating expenses
|
17,559
|
19,305
|
||||||
|
Operating
income
|
21,320
|
18,526
|
||||||
|
Other
expense
|
||||||||
|
Interest
expense
|
5,461
|
5,654
|
||||||
|
Loss
on extinguishment of debt
|
300
|
—
|
||||||
|
Total
other expense
|
5,761
|
5,654
|
||||||
|
Income
from continuing operations before income taxes
|
15,559
|
12,872
|
||||||
|
Provision
for income taxes
|
5,944
|
4,878
|
||||||
|
Income
from continuing operations
|
9,615
|
7,994
|
||||||
|
Discontinued
Operations
|
||||||||
|
Income
(loss) from discontinued operations, net of income tax
|
(10
|
)
|
331
|
|||||
|
Net
income
|
$
|
9,605
|
$
|
8,325
|
||||
|
Basic
earnings per share:
|
||||||||
|
Income
from continuing operations
|
$
|
0.19
|
$
|
0.16
|
||||
|
Net
income
|
$
|
0.19
|
$
|
0.17
|
||||
|
Diluted
earnings per share:
|
||||||||
|
Income
from continuing operations
|
$
|
0.19
|
$
|
0.16
|
||||
|
Net
income
|
$
|
0.19
|
$
|
0.17
|
||||
|
Weighted
average shares outstanding:
|
||||||||
|
Basic
|
50,038
|
49,982
|
||||||
|
Diluted
|
50,105
|
50,095
|
||||||
-4-
Prestige
Brands Holdings, Inc.
|
Assets
|
June 30,
2010
|
March 31,
2010
|
||||||
|
Current
assets
|
||||||||
|
Cash
and cash equivalents
|
$ | 33,106 | $ | 41,097 | ||||
|
Accounts
receivable
|
28,543 | 30,621 | ||||||
|
Inventories
|
28,076 | 29,162 | ||||||
|
Deferred
income tax assets
|
6,745 | 6,353 | ||||||
|
Prepaid
expenses and other current assets
|
2,888 | 4,917 | ||||||
|
Total
current assets
|
99,358 | 112,150 | ||||||
|
Property
and equipment
|
1,243 | 1,396 | ||||||
|
Goodwill
|
111,489 | 111,489 | ||||||
|
Intangible
assets
|
556,840 | 559,229 | ||||||
|
Other
long-term assets
|
6,705 | 7,148 | ||||||
|
Total
Assets
|
$ | 775,635 | $ | 791,412 | ||||
|
Liabilities
and Stockholders' Equity
|
||||||||
|
Current
liabilities
|
||||||||
|
Accounts
payable
|
$ | 12,112 | $ | 12,771 | ||||
|
Accrued
interest payable
|
3,443 | 1,561 | ||||||
|
Other
accrued liabilities
|
10,161 | 11,733 | ||||||
|
Current
portion of long-term debt
|
1,500 | 29,587 | ||||||
|
Total
current liabilities
|
27,216 | 55,652 | ||||||
|
Long-term
debt
|
||||||||
|
Principal
amount
|
298,125 | 298,500 | ||||||
|
Less
unamortized discount
|
(3,801 | ) | (3,943 | ) | ||||
|
Long-term
debt, net of unamortized discount
|
294,324 | 294,557 | ||||||
|
Deferred
income tax liabilities
|
114,574 | 112,144 | ||||||
|
Total
Liabilities
|
436,114 | 462,353 | ||||||
|
Stockholders'
Equity
|
||||||||
|
Preferred
stock - $0.01 par value
|
||||||||
|
Authorized
- 5,000 shares
|
||||||||
|
Issued
and outstanding – None
|
— | — | ||||||
|
Common
stock - $0.01 par value
|
||||||||
|
Authorized
- 250,000 shares
|
||||||||
|
Issued
- 50,173 shares at June 30, 2010 and 50,154 shares at March 31,
2010
|
502 | 502 | ||||||
|
Additional
paid-in capital
|
384,884 | 384,027 | ||||||
|
Treasury
stock, at cost — 124 shares at June 30, 2010 and March 31,
2010
|
(63 | ) | (63 | ) | ||||
|
Accumulated
other comprehensive income (loss)
|
— | — | ||||||
|
Retained
earnings (accumulated deficit)
|
(45,802 | ) | (55,407 | ) | ||||
|
Total
Stockholders' Equity
|
339,521 | 329,059 | ||||||
|
Total
Liabilities and Stockholders' Equity
|
$ | 775,635 | $ | 791,412 |
-5-
|
Three
Months Ended June 30
|
||||||||
|
(In
thousands)
|
2010
|
2009
|
||||||
|
Operating
Activities
|
||||||||
|
Net
income
|
$ | 9,605 | $ | 8,325 | ||||
|
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
||||||||
|
Depreciation
and amortization
|
2,547 | 2,777 | ||||||
|
Deferred
income taxes
|
2,036 | 2,430 | ||||||
|
Amortization
of deferred financing costs
|
397 | 480 | ||||||
|
Impairment
of goodwill and intangible assets
|
||||||||
|
Stock-based
compensation cost
|
857 | 671 | ||||||
|
Loss
on extinguishment of debt
|
300 | — | ||||||
|
Loss
on disposition of equipment
|
126 | — | ||||||
|
Changes
in operating assets and liabilities
|
||||||||
|
Accounts
receivable
|
2,078 | 3,010 | ||||||
|
Inventories
|
1,086 | 528 | ||||||
|
Prepaid
expenses and other current assets
|
2,029 | (1,452 | ) | |||||
|
Accounts
payable
|
(659 | ) | 584 | |||||
|
Income
taxes payable
|
— | 1,551 | ||||||
|
Accrued
liabilities
|
310 | (836 | ) | |||||
|
Net
cash provided by operating activities
|
20,712 | 18,068 | ||||||
|
Investing
Activities
|
||||||||
|
Purchases
of equipment
|
(130 | ) | (98 | ) | ||||
|
Net
cash provided by (used for) investing activities
|
(130 | ) | (98 | ) | ||||
|
Financing
Activities
|
||||||||
|
Proceeds
from the issuance of debt
|
— | — | ||||||
|
Payment
of deferred financing costs
|
(111 | ) | — | |||||
|
Repayment
of long-term debt
|
(28,462 | ) | (17,000 | ) | ||||
|
Purchase
of common stock for treasury
|
— | — | ||||||
|
Net
cash used for financing activities
|
(28,573 | ) | (17,000 | ) | ||||
|
Increase
(decrease) in cash
|
(7,991 | ) | 970 | |||||
|
Cash
- beginning of period
|
41,097 | 35,181 | ||||||
|
Cash
- end of period
|
$ | 33,106 | $ | 36,151 | ||||
|
Interest
paid
|
$ | 3,182 | $ | 8,085 | ||||
|
Income
taxes paid
|
$ | 342 | $ | 1,100 | ||||
-6-
Consolidated
Statements of Operations
Business
Segments
(Unaudited)
|
For
the Three Months Ended June 30, 2010
|
||||||||||||||||
|
Over-the-
Counter
|
Personal
Care
|
Consolidated
|
||||||||||||||
|
(In
thousands)
|
||||||||||||||||
|
Net
sales
|
$ | 44,323 | $ | 25,814 | $ | 2,569 | $ | 72,706 | ||||||||
|
Other
revenues
|
14 | 701 | 4 | 719 | ||||||||||||
|
Total
revenues
|
44,337 | 26,515 | 2,573 | 73,425 | ||||||||||||
|
Cost
of sales
|
15,582 | 17,412 | 1,552 | 34,546 | ||||||||||||
|
Gross
profit
|
28,755 | 9,103 | 1,021 | 38,879 | ||||||||||||
|
Advertising
and promotion
|
5,154 | 2,324 | 120 | 7,598 | ||||||||||||
|
Contribution
margin
|
$ | 23,601 | $ | 6,779 | $ | 901 | 31,281 | |||||||||
|
Other
operating expenses
|
9,961 | |||||||||||||||
|
Operating
income
|
21,320 | |||||||||||||||
|
Other
expense
|
5,761 | |||||||||||||||
|
Provision
for income taxes
|
5,944 | |||||||||||||||
|
Income
from continuing operations
|
9,615 | |||||||||||||||
|
Loss
from discontinued operations, net of
income benefit
|
(10 | ) | ||||||||||||||
|
Net
income
|
$ | 9,605 | ||||||||||||||
-7-
Prestige
Brands Holdings, Inc.
Consolidated
Statements of Operations
Business
Segments
(Unaudited)
|
For
the Three Months Ended June 30, 2009
|
||||||||||||||||
|
Over-the-
Counter
|
Personal
Care
|
Consolidated
|
||||||||||||||
|
(In
thousands)
|
||||||||||||||||
|
Net
sales
|
$ | 40,272 | $ | 26,841 | $ | 3,282 | $ | 70,395 | ||||||||
|
Other
revenues
|
11 | 606 | — | 617 | ||||||||||||
|
Total
revenues
|
40,283 | 27,447 | 3,282 | 71,012 | ||||||||||||
|
Cost
of sales
|
13,528 | 17,801 | 1,852 | 33,181 | ||||||||||||
|
Gross
profit
|
26,755 | 9,646 | 1,430 | 37,831 | ||||||||||||
|
Advertising
and promotion
|
6,740 | 1,919 | 106 | 8,765 | ||||||||||||
|
Contribution
margin
|
$ | 20,015 | $ | 7,727 | $ | 1,324 | 29,066 | |||||||||
|
Other
operating expenses
|
10,540 | |||||||||||||||
|
Operating
income
|
18,526 | |||||||||||||||
|
Other
expense
|
5,654 | |||||||||||||||
|
Provision
for income taxes
|
4,878 | |||||||||||||||
|
Income
from continuing operations
|
7,994 | |||||||||||||||
|
Income
from discontinued operations, net of income tax
|
331 | |||||||||||||||
|
Net
income
|
$ | 8,325 | ||||||||||||||
-8-