Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil EL&P Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries Prestige Consumer Healthcare Inc. Reports Second Quarter Fiscal 2024 Results By: Prestige Consumer Healthcare Inc. via GlobeNewswire November 02, 2023 at 06:00 AM EDT Revenue of $286.3 Million in Q2, Ahead of OutlookDiluted EPS of $1.07 in Q2, Up Over 5% Versus Prior YearReduced Leverage Ratio to 3.0x at Quarter EndReaffirming Full-Year Fiscal 2024 Revenue, Earnings, and Cash Flow Outlook TARRYTOWN, N.Y., Nov. 02, 2023 (GLOBE NEWSWIRE) -- Prestige Consumer Healthcare Inc. (NYSE:PBH) today reported financial results for its second quarter and first six months ended September 30, 2023. “Our second quarter results build on a strong first quarter performance thanks to our diverse and leading portfolio of brands and broad distribution. This stable top-line performance was amplified by our strong financial model and resulted in second quarter mid-single-digit earnings growth versus prior year. The earnings growth translated into robust free cash flow that we used for debt reduction and resulting leverage which will enable further disciplined capital deployment,” said Ron Lombardi, Chief Executive Officer of Prestige Consumer Healthcare. Second Fiscal Quarter Ended September 30, 2023 Reported revenues in the second quarter of fiscal 2024 of $286.3 million compared to a record $289.3 million in the second quarter of fiscal 2023. Revenues decreased 0.7% versus the prior year second quarter excluding the impact of foreign currency. The revenue performance for the quarter was led by Cough & Cold and Ear & Eye Care category performances in North America and strong International OTC segment growth versus the prior year comparable period, offset by declines in certain other categories and the planned strategic exit of private label revenues. Reported net income for the second quarter of fiscal 2024 totaled $53.6 million, compared to the prior year second quarter’s net income of $51.0 million. Diluted earnings per share of $1.07 for the second quarter of fiscal 2024 increased 5.4% versus $1.02 in the prior year comparable period. Six Months Ended September 30, 2023 Reported revenues for the first six months of fiscal 2024 totaled $565.6 million and compared to revenues of $566.3 million for the first six months of fiscal 2023. Revenues increased 0.5% versus the prior year six-month period, excluding the impact of foreign currency. The revenue growth for the first six months was driven by International OTC segment performance and strong Dermatological category sales in North America, offset by lower Women’s Health category sales and the strategic exit of private label revenues. Reported net income for the first six months of fiscal 2024 totaled $106.8 million versus the prior year comparable period net income of $106.3 million. Diluted earnings per share were $2.13 for the first six months of fiscal 2024 increased compared to diluted earnings per share of $2.11 in the prior year comparable period. Free Cash Flow and Balance Sheet The Company's net cash provided by operating activities for the second quarter fiscal 2024 was $62.5 million, compared to $57.5 million during the prior year comparable period. Non-GAAP free cash flow in the second quarter of fiscal 2024 was $59.5 million compared to $55.2 million in the prior year second quarter. The Company's net cash provided by operating activities for the first six months of fiscal 2024 was $110.5 million, compared to $115.8 million during the prior year comparable period. Non-GAAP free cash flow in the first six months of fiscal 2024 was $106.1 million compared to $112.4 million in the prior year comparable period, with the change attributable to the timing of working capital. In the first quarter fiscal 2024, the Company repurchased approximately 0.4 million shares at a total investment of $25.0 million, completing its previously authorized share repurchase program. The Company's net debt position as of September 30, 2023 was approximately $1.2 billion, resulting in a covenant-defined leverage ratio of 3.0x. Segment Review North American OTC Healthcare: Segment revenues of $244.4 million for the second quarter fiscal 2024 decreased 3.0% compared to the prior year comparable quarter's record segment revenues of $252.1 million. The revenue performance for the quarter was driven by lower sales in Women’s Health and certain other categories as well as the strategic exit of private label, partially offset by strong performance in the Cough & Cold and Ear & Eye Care categories. For the first six months of the current fiscal year, reported revenues for the North American OTC segment were $490.6 million, which compared to $494.6 million in the prior year comparable period. The change was attributable to lower sales in the Women’s Health category, partially offset by higher sales in other categories including Dermatologicals, Ear & Eye Care, and Gastrointestinal. International OTC Healthcare: Fiscal second quarter 2024 segment revenues were $41.9 million compared to $37.2 million reported in the prior year comparable period. The increase in revenue versus the prior year second quarter was driven by strong Eye & Ear Care and Women’s Health sales, partially offset by a $0.7 million currency headwind. For the first six months of the current fiscal year, reported revenues for the International OTC Healthcare segment were $75.1 million, an increase of approximately 5% over the prior year comparable period’s revenues of $71.8 million or an increase of 8.5% after excluding the impact a $2.6M foreign currency headwind. The strong sales growth exceeded the Company’s long-term growth expectation for the segment. Commentary Reaffirming Outlook for Fiscal 2024 Ron Lombardi, Chief Executive Officer, stated, “We were pleased with our top-line performance against a record result in Q2 of the prior year. This was driven by our continued brand-building efforts and growth in multiple categories including Cough & Cold and Ear & Eye Care as well as our International segment. The resulting strong profitability and free cash flow enabled our continued disciplined capital deployment, which reduced debt by $55 million in the quarter and improved our leverage to 3.0x and the end of September.” “Looking ahead, we are reaffirming our fiscal 2024 outlook that includes solid sales and earnings growth expectations. While we anticipate a continued dynamic macro environment, our diverse portfolio of brands in a resilient needs-based section of the store leave us well positioned to continue to create long-term shareholder value,” Mr. Lombardi concluded. Reaffirmed Fiscal 2024 Outlook Revenue$1,135 to $1,140 million Organic Revenue Growth1% to 2% Diluted E.P.S.$4.27 to $4.32 Free Cash Flow$240 million or more Fiscal Second Quarter 2024 Conference Call, Accompanying Slide Presentation and Replay The Company will host a conference call to review its second quarter fiscal 2024 results today, November 2, 2023 at 8:30 a.m. ET. The Company provides a live Internet webcast, a slide presentation to accompany the call, as well as an archived replay, all of which can be accessed from the Investor Relations page of the Company's website at www.prestigeconsumerhealthcare.com. To participate in the conference call via phone, participants may register for the call here to receive dial-in details and a unique pin. While not required, it is recommended to join 10 minutes prior to the event start. The slide presentation can be accessed from the Investor Relations page of the website by clicking on Webcasts and Presentations. A conference call replay will be available for approximately one week following completion of the live call and can be accessed on the Company’s Investor Relations page. Non-GAAP and Other Financial InformationIn addition to financial results reported in accordance with generally accepted accounting principles (GAAP), we have provided certain non-GAAP financial information in this release to aid investors in understanding the Company's performance. Each non-GAAP financial measure is defined and reconciled to its most closely related GAAP financial measure in the “About Non-GAAP Financial Measures” section at the end of this earnings release. Note Regarding Forward-Looking Statements This news release contains "forward-looking statements" within the meaning of the federal securities laws 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 "outlook," "projected," "may," "will," "would," "expect," "anticipate," 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 operating results including revenues, organic growth, diluted earnings per share, and free cash flow, the Company’s disciplined capital deployment, the Company’s brand-building efforts, the impact of the macro environment, and the Company’s ability to create shareholder value. 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, including the impact of business and economic conditions, including as a result of labor shortages, inflation and geopolitical instability, consumer trends, the impact of the Company’s advertising and marketing and new product development initiatives, customer inventory management initiatives, fluctuating foreign exchange rates, competitive pressures, and the ability of the Company’s manufacturing operations and third party manufacturers and logistics providers and suppliers to meet demand for its products and to avoid inflationary cost increases and disruption as a result of labor shortages. A discussion of other factors that could cause results to vary is included in the Company’s Annual Report on Form 10-K for the year ended March 31, 2023 and other periodic reports filed with the Securities and Exchange Commission. About Prestige Consumer Healthcare Inc.Prestige Consumer Healthcare is a leading consumer healthcare products company with sales throughout the U.S. and Canada, Australia, and in certain other international markets. The Company’s diverse portfolio of brands include Monistat® and Summer’s Eve® women’s health products, BC® and Goody's® pain relievers, Clear Eyes® and TheraTears® eye care products, DenTek® specialty oral care products, Dramamine® motion sickness treatments, Fleet® enemas and glycerin suppositories, Chloraseptic® and Luden’s® sore throat treatments and drops, Compound W® wart treatments, Little Remedies® pediatric over-the-counter products, Boudreaux’s Butt Paste® diaper rash ointments, Nix® lice treatment, Debrox® earwax remover, Gaviscon® antacid in Canada, and Hydralyte® rehydration products and the Fess® line of nasal and sinus care products in Australia. Visit the Company’s website at www.prestigeconsumerhealthcare.com. Investor Relations ContactPhil Terpolilli, CFA, 914-524-6819irinquiries@prestigebrands.com Prestige Consumer Healthcare Inc.Condensed Consolidated Statements of Income and Comprehensive Income(Unaudited) Three Months Ended September 30, Six Months Ended September 30,(In thousands, except per share data) 2023 2022 2023 2022 Total Revenues$286,316 $289,273 $565,625 $566,332 Cost of Sales Cost of sales excluding depreciation 124,324 126,384 246,978 241,380 Cost of sales depreciation 1,972 1,880 3,954 3,824 Cost of sales 126,296 128,264 250,932 245,204 Gross profit 160,020 161,009 314,693 321,128 Operating Expenses Advertising and marketing 40,102 43,819 76,333 83,770 General and administrative 25,997 26,438 53,684 53,152 Depreciation and amortization 5,671 6,368 11,232 12,808 Total operating expenses 71,770 76,625 141,249 149,730 Operating income 88,250 84,384 173,444 171,398 Other expense Interest expense, net 17,606 16,979 35,325 32,271 Other (income) expense, net 229 812 (1,009) 1,637 Total other expense, net 17,835 17,791 34,316 33,908 Income before income taxes 70,415 66,593 139,128 137,490 Provision for income taxes 16,856 15,570 32,293 31,195 Net income$53,559 $51,023 $106,835 $106,295 Earnings per share: Basic$1.08 $1.02 $2.15 $2.12 Diluted$1.07 $1.02 $2.13 $2.11 Weighted average shares outstanding: Basic 49,687 49,804 49,727 50,033 Diluted 50,081 50,265 50,138 50,496 Comprehensive income, net of tax: Currency translation adjustments (3,784) (7,118) (4,430) (16,637)Net loss on termination of pension plan — — — (790)Total other comprehensive loss (3,784) (7,118) (4,430) (17,427)Comprehensive income$49,775 $43,905 $102,405 $88,868 Prestige Consumer Healthcare Inc.Condensed Consolidated Balance Sheets(Unaudited) (In thousands)September 30, 2023 March 31, 2023 Assets Current assets Cash and cash equivalents$60,067 $58,489Accounts receivable, net of allowance of $21,994 and $20,205, respectively 158,456 167,016Inventories 161,283 162,121Prepaid expenses and other current assets 8,392 4,117Total current assets 388,198 391,743 Property, plant and equipment, net 70,700 70,412Operating lease right-of-use assets 12,134 14,923Finance lease right-of-use assets, net 2,870 4,200Goodwill 526,860 527,553Intangible assets, net 2,328,250 2,341,893Other long-term assets 3,862 3,005Total Assets$3,332,874 $3,353,729 Liabilities and Stockholders' Equity Current liabilities Accounts payable 44,381 62,743Accrued interest payable 15,635 15,688Operating lease liabilities, current portion 6,732 6,926Finance lease liabilities, current portion 2,876 2,834Other accrued liabilities 60,080 72,524Total current liabilities 129,704 160,715 Long-term debt, net 1,262,972 1,345,788Deferred income tax liabilities 388,481 380,434Long-term operating lease liabilities, net of current portion 6,644 9,876Long-term finance lease liabilities, net of current portion 218 1,667Other long-term liabilities 8,896 8,165Total Liabilities 1,796,915 1,906,645 Total Stockholders' Equity 1,535,959 1,447,084Total Liabilities and Stockholders' Equity$3,332,874 $3,353,729 Prestige Consumer Healthcare Inc.Condensed Consolidated Statements of Cash Flows(Unaudited) Six Months Ended September 30,(In thousands) 2023 2022 Operating Activities Net income$106,835 $106,295 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 15,186 16,632 Loss on disposal of property and equipment 191 94 Deferred income taxes 9,721 4,211 Amortization of debt origination costs 2,302 1,798 Stock-based compensation costs 7,834 7,323 Non-cash operating lease cost 2,816 2,984 Other — 447 Changes in operating assets and liabilities: Accounts receivable 4,415 (8,276)Inventories 223 (21,810)Prepaid expenses and other current assets (3,814) (1,501)Accounts payable (18,820) 1,016 Accrued liabilities (11,764) 9,788 Operating lease liabilities (3,493) (3,201)Other (1,085) (13)Net cash provided by operating activities 110,547 115,787 Investing Activities Purchases of property, plant and equipment (4,411) (3,423)Other 3,800 — Net cash provided by (used in) investing activities (611) (3,423) Financing Activities Term loan repayments (85,000) (40,000)Borrowings under revolving credit agreement — 20,000 Repayments under revolving credit agreement — (20,000)Payments of finance leases (1,403) (1,369)Proceeds from exercise of stock options 9,183 1,489 Fair value of shares surrendered as payment of tax withholding (5,508) (5,450)Repurchase of common stock (25,000) (50,000)Net cash used in financing activities (107,728) (95,330) Effects of exchange rate changes on cash and cash equivalents (630) (1,777)Increase (decrease) in cash and cash equivalents 1,578 15,257 Cash and cash equivalents - beginning of period 58,489 27,185 Cash and cash equivalents - end of period$60,067 $42,442 Interest paid$33,706 $19,016 Income taxes paid$25,118 $15,689 Prestige Consumer Healthcare Inc.Condensed Consolidated Statements of IncomeBusiness Segments(Unaudited) Three Months Ended September 30, 2023(In thousands)North American OTCHealthcare International OTCHealthcare ConsolidatedTotal segment revenues*$244,423 $41,893 $286,316Cost of sales 107,466 18,830 126,296Gross profit 136,957 23,063 160,020Advertising and marketing 35,389 4,713 40,102Contribution margin$101,568 $18,350 $119,918Other operating expenses 31,668Operating income $88,250 *Intersegment revenues of $0.6 million were eliminated from the North American OTC Healthcare segment. Six Months Ended September 30, 2023(In thousands)North American OTC Healthcare International OTC Healthcare ConsolidatedTotal segment revenues*$490,566 $75,059 $565,625Cost of sales 217,542 33,390 250,932Gross profit 273,024 41,669 314,693Advertising and marketing 66,790 9,543 76,333Contribution margin$206,234 $32,126 $238,360Other operating expenses 64,916Operating income $173,444 *Intersegment revenues of $2.0 million were eliminated from the North American OTC Healthcare segment. Three Months Ended September 30, 2022(In thousands)North American OTC Healthcare International OTC Healthcare ConsolidatedTotal segment revenues*$252,054 $37,219 $289,273Cost of sales 113,533 14,731 128,264Gross profit 138,521 22,488 161,009Advertising and marketing 39,316 4,503 43,819Contribution margin$99,205 $17,985 $117,190Other operating expenses 32,806Operating income $84,384 * Intersegment revenues of $1.1 million were eliminated from the North American OTC Healthcare segment. Six Months Ended September 30, 2022(In thousands)North American OTC Healthcare International OTC Healthcare ConsolidatedTotal segment revenues*$494,572 $71,760 $566,332Cost of sales 216,454 28,750 245,204Gross profit 278,118 43,010 321,128Advertising and marketing 74,728 9,042 83,770Contribution margin$203,390 $33,968 $237,358Other operating expenses 65,960Operating income $171,398 * Intersegment revenues of $1.7 million were eliminated from the North American OTC Healthcare segment. About Non-GAAP Financial Measures In addition to financial results reported in accordance with GAAP, we disclose certain Non-GAAP financial measures ("NGFMs"), including, but not limited to, Non-GAAP Organic Revenues, Non-GAAP Organic Revenue Change Percentage, Non-GAAP EBITDA, Non-GAAP EBITDA Margin, Non-GAAP Free Cash Flow, and Net Debt. We use these NGFMs internally, along with GAAP information, in evaluating our operating performance and in making financial and operational decisions. We believe that the presentation of these NGFMs provides investors with greater transparency, and provides a more complete understanding of our business than could be obtained absent these disclosures, because the supplemental data relating to our financial condition and results of operations provides additional ways to view our operation when considered with both our GAAP results and the reconciliations below. In addition, we believe that the presentation of each of these NGFMs is useful to investors for period-to-period comparisons of results in assessing shareholder value, and we use these NGFMs internally to evaluate the performance of our personnel and also to evaluate our operating performance and compare our performance to that of our competitors. These NGFMs are not in accordance with GAAP, should not be considered as a measure of profitability or liquidity, and may not be directly comparable to similarly titled NGFMs reported by other companies. These NGFMs have limitations and they should not be considered in isolation from or as an alternative to their most closely related GAAP measures reconciled below. Investors should not rely on any single financial measure when evaluating our business. We recommend investors review the GAAP financial measures included in this earnings release. When viewed in conjunction with our GAAP results and the reconciliations below, we believe these NGFMs provide greater transparency and a more complete understanding of factors affecting our business than GAAP measures alone. NGFMs Defined We define our NGFMs presented herein as follows: Non-GAAP Organic Revenues: GAAP Total Revenues excluding the impact of foreign currency exchange rates in the periods presented.Non-GAAP Organic Revenue Change Percentage: Calculated as the change in Non-GAAP Organic Revenues from prior year divided by prior year Non-GAAP Organic Revenues.Non-GAAP EBITDA: GAAP Net Income before interest expense, net, provision for income taxes, and depreciation and amortization.Non-GAAP EBITDA Margin: Calculated as Non-GAAP EBITDA divided by GAAP Total Revenues.Non-GAAP Free Cash Flow: Calculated as GAAP Net cash provided by operating activities less cash paid for capital expenditures.Net Debt: Calculated as total principal amount of debt outstanding ($1,275,000 at September 30, 2023) less cash and cash equivalents ($60,067 at September 30, 2023). Amounts in thousands. The following tables set forth the reconciliations of each of our NGFMs (other than Net Debt, which is reconciled above) to their most directly comparable financial measures presented in accordance with GAAP. Reconciliation of GAAP Total Revenues to Non-GAAP Organic Revenues and related Non-GAAP Organic Revenue Change percentage: Three Months Ended September 30, Six Months Ended September 30, 2023 2022 2023 2022 (In thousands) GAAP Total Revenues$286,316 $289,273 $565,625 $566,332 Revenue Change (1.0)% (0.1)% Adjustments: Impact of foreign currency exchange rates — (1,035) — (3,759)Total adjustments — (1,035) — (3,759)Non-GAAP Organic Revenues$286,316 $288,238 $565,625 $562,573 Non-GAAP Organic Revenue Change (0.7)% 0.5% Reconciliation of GAAP Net Income to Non-GAAP EBITDA and related Non-GAAP EBITDA Margin: Three Months Ended September 30, Six Months Ended September 30, 2023 2022 2023 2022 (In thousands) GAAP Net Income$53,559 $51,023 $106,835 $106,295 Interest expense, net 17,606 16,979 35,325 32,271 Provision for income taxes 16,856 15,570 32,293 31,195 Depreciation and amortization 7,643 8,248 15,186 16,632 Non-GAAP EBITDA$95,664 $91,820 $189,639 $186,393 Non-GAAP EBITDA Margin 33.4% 31.7% 33.5% 32.9% Reconciliation of GAAP Net Income to Non-GAAP Free Cash Flow: Three Months Ended September 30, Six Months Ended September 30, 2023 2022 2023 2022 (In thousands) GAAP Net Income$53,559 $51,023 $106,835 $106,295 Adjustments: Adjustments to reconcile net income to net cash provided by operating activities as shown in the Statement of Cash Flows 19,862 17,255 38,050 33,489 Changes in operating assets and liabilities as shown in the Statement of Cash Flows (10,961) (10,738) (34,338) (23,997)Total adjustments 8,901 6,517 3,712 9,492 GAAP Net cash provided by operating activities 62,460 57,540 110,547 115,787 Purchases of property and equipment (2,934) (2,376) (4,411) (3,423)Non-GAAP Free Cash Flow$59,526 $55,164 $106,136 $112,364 Outlook for Fiscal Year 2024: Reconciliation of Projected GAAP Net cash provided by operating activities to Projected Non-GAAP Free Cash Flow: (In millions) Projected FY'24 GAAP Net cash provided by operating activities$250 Additions to property and equipment for cash (10)Projected FY'24 Non-GAAP Free Cash Flow$240 Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
Prestige Consumer Healthcare Inc. Reports Second Quarter Fiscal 2024 Results By: Prestige Consumer Healthcare Inc. via GlobeNewswire November 02, 2023 at 06:00 AM EDT Revenue of $286.3 Million in Q2, Ahead of OutlookDiluted EPS of $1.07 in Q2, Up Over 5% Versus Prior YearReduced Leverage Ratio to 3.0x at Quarter EndReaffirming Full-Year Fiscal 2024 Revenue, Earnings, and Cash Flow Outlook TARRYTOWN, N.Y., Nov. 02, 2023 (GLOBE NEWSWIRE) -- Prestige Consumer Healthcare Inc. (NYSE:PBH) today reported financial results for its second quarter and first six months ended September 30, 2023. “Our second quarter results build on a strong first quarter performance thanks to our diverse and leading portfolio of brands and broad distribution. This stable top-line performance was amplified by our strong financial model and resulted in second quarter mid-single-digit earnings growth versus prior year. The earnings growth translated into robust free cash flow that we used for debt reduction and resulting leverage which will enable further disciplined capital deployment,” said Ron Lombardi, Chief Executive Officer of Prestige Consumer Healthcare. Second Fiscal Quarter Ended September 30, 2023 Reported revenues in the second quarter of fiscal 2024 of $286.3 million compared to a record $289.3 million in the second quarter of fiscal 2023. Revenues decreased 0.7% versus the prior year second quarter excluding the impact of foreign currency. The revenue performance for the quarter was led by Cough & Cold and Ear & Eye Care category performances in North America and strong International OTC segment growth versus the prior year comparable period, offset by declines in certain other categories and the planned strategic exit of private label revenues. Reported net income for the second quarter of fiscal 2024 totaled $53.6 million, compared to the prior year second quarter’s net income of $51.0 million. Diluted earnings per share of $1.07 for the second quarter of fiscal 2024 increased 5.4% versus $1.02 in the prior year comparable period. Six Months Ended September 30, 2023 Reported revenues for the first six months of fiscal 2024 totaled $565.6 million and compared to revenues of $566.3 million for the first six months of fiscal 2023. Revenues increased 0.5% versus the prior year six-month period, excluding the impact of foreign currency. The revenue growth for the first six months was driven by International OTC segment performance and strong Dermatological category sales in North America, offset by lower Women’s Health category sales and the strategic exit of private label revenues. Reported net income for the first six months of fiscal 2024 totaled $106.8 million versus the prior year comparable period net income of $106.3 million. Diluted earnings per share were $2.13 for the first six months of fiscal 2024 increased compared to diluted earnings per share of $2.11 in the prior year comparable period. Free Cash Flow and Balance Sheet The Company's net cash provided by operating activities for the second quarter fiscal 2024 was $62.5 million, compared to $57.5 million during the prior year comparable period. Non-GAAP free cash flow in the second quarter of fiscal 2024 was $59.5 million compared to $55.2 million in the prior year second quarter. The Company's net cash provided by operating activities for the first six months of fiscal 2024 was $110.5 million, compared to $115.8 million during the prior year comparable period. Non-GAAP free cash flow in the first six months of fiscal 2024 was $106.1 million compared to $112.4 million in the prior year comparable period, with the change attributable to the timing of working capital. In the first quarter fiscal 2024, the Company repurchased approximately 0.4 million shares at a total investment of $25.0 million, completing its previously authorized share repurchase program. The Company's net debt position as of September 30, 2023 was approximately $1.2 billion, resulting in a covenant-defined leverage ratio of 3.0x. Segment Review North American OTC Healthcare: Segment revenues of $244.4 million for the second quarter fiscal 2024 decreased 3.0% compared to the prior year comparable quarter's record segment revenues of $252.1 million. The revenue performance for the quarter was driven by lower sales in Women’s Health and certain other categories as well as the strategic exit of private label, partially offset by strong performance in the Cough & Cold and Ear & Eye Care categories. For the first six months of the current fiscal year, reported revenues for the North American OTC segment were $490.6 million, which compared to $494.6 million in the prior year comparable period. The change was attributable to lower sales in the Women’s Health category, partially offset by higher sales in other categories including Dermatologicals, Ear & Eye Care, and Gastrointestinal. International OTC Healthcare: Fiscal second quarter 2024 segment revenues were $41.9 million compared to $37.2 million reported in the prior year comparable period. The increase in revenue versus the prior year second quarter was driven by strong Eye & Ear Care and Women’s Health sales, partially offset by a $0.7 million currency headwind. For the first six months of the current fiscal year, reported revenues for the International OTC Healthcare segment were $75.1 million, an increase of approximately 5% over the prior year comparable period’s revenues of $71.8 million or an increase of 8.5% after excluding the impact a $2.6M foreign currency headwind. The strong sales growth exceeded the Company’s long-term growth expectation for the segment. Commentary Reaffirming Outlook for Fiscal 2024 Ron Lombardi, Chief Executive Officer, stated, “We were pleased with our top-line performance against a record result in Q2 of the prior year. This was driven by our continued brand-building efforts and growth in multiple categories including Cough & Cold and Ear & Eye Care as well as our International segment. The resulting strong profitability and free cash flow enabled our continued disciplined capital deployment, which reduced debt by $55 million in the quarter and improved our leverage to 3.0x and the end of September.” “Looking ahead, we are reaffirming our fiscal 2024 outlook that includes solid sales and earnings growth expectations. While we anticipate a continued dynamic macro environment, our diverse portfolio of brands in a resilient needs-based section of the store leave us well positioned to continue to create long-term shareholder value,” Mr. Lombardi concluded. Reaffirmed Fiscal 2024 Outlook Revenue$1,135 to $1,140 million Organic Revenue Growth1% to 2% Diluted E.P.S.$4.27 to $4.32 Free Cash Flow$240 million or more Fiscal Second Quarter 2024 Conference Call, Accompanying Slide Presentation and Replay The Company will host a conference call to review its second quarter fiscal 2024 results today, November 2, 2023 at 8:30 a.m. ET. The Company provides a live Internet webcast, a slide presentation to accompany the call, as well as an archived replay, all of which can be accessed from the Investor Relations page of the Company's website at www.prestigeconsumerhealthcare.com. To participate in the conference call via phone, participants may register for the call here to receive dial-in details and a unique pin. While not required, it is recommended to join 10 minutes prior to the event start. The slide presentation can be accessed from the Investor Relations page of the website by clicking on Webcasts and Presentations. A conference call replay will be available for approximately one week following completion of the live call and can be accessed on the Company’s Investor Relations page. Non-GAAP and Other Financial InformationIn addition to financial results reported in accordance with generally accepted accounting principles (GAAP), we have provided certain non-GAAP financial information in this release to aid investors in understanding the Company's performance. Each non-GAAP financial measure is defined and reconciled to its most closely related GAAP financial measure in the “About Non-GAAP Financial Measures” section at the end of this earnings release. Note Regarding Forward-Looking Statements This news release contains "forward-looking statements" within the meaning of the federal securities laws 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 "outlook," "projected," "may," "will," "would," "expect," "anticipate," 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 operating results including revenues, organic growth, diluted earnings per share, and free cash flow, the Company’s disciplined capital deployment, the Company’s brand-building efforts, the impact of the macro environment, and the Company’s ability to create shareholder value. 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, including the impact of business and economic conditions, including as a result of labor shortages, inflation and geopolitical instability, consumer trends, the impact of the Company’s advertising and marketing and new product development initiatives, customer inventory management initiatives, fluctuating foreign exchange rates, competitive pressures, and the ability of the Company’s manufacturing operations and third party manufacturers and logistics providers and suppliers to meet demand for its products and to avoid inflationary cost increases and disruption as a result of labor shortages. A discussion of other factors that could cause results to vary is included in the Company’s Annual Report on Form 10-K for the year ended March 31, 2023 and other periodic reports filed with the Securities and Exchange Commission. About Prestige Consumer Healthcare Inc.Prestige Consumer Healthcare is a leading consumer healthcare products company with sales throughout the U.S. and Canada, Australia, and in certain other international markets. The Company’s diverse portfolio of brands include Monistat® and Summer’s Eve® women’s health products, BC® and Goody's® pain relievers, Clear Eyes® and TheraTears® eye care products, DenTek® specialty oral care products, Dramamine® motion sickness treatments, Fleet® enemas and glycerin suppositories, Chloraseptic® and Luden’s® sore throat treatments and drops, Compound W® wart treatments, Little Remedies® pediatric over-the-counter products, Boudreaux’s Butt Paste® diaper rash ointments, Nix® lice treatment, Debrox® earwax remover, Gaviscon® antacid in Canada, and Hydralyte® rehydration products and the Fess® line of nasal and sinus care products in Australia. Visit the Company’s website at www.prestigeconsumerhealthcare.com. Investor Relations ContactPhil Terpolilli, CFA, 914-524-6819irinquiries@prestigebrands.com Prestige Consumer Healthcare Inc.Condensed Consolidated Statements of Income and Comprehensive Income(Unaudited) Three Months Ended September 30, Six Months Ended September 30,(In thousands, except per share data) 2023 2022 2023 2022 Total Revenues$286,316 $289,273 $565,625 $566,332 Cost of Sales Cost of sales excluding depreciation 124,324 126,384 246,978 241,380 Cost of sales depreciation 1,972 1,880 3,954 3,824 Cost of sales 126,296 128,264 250,932 245,204 Gross profit 160,020 161,009 314,693 321,128 Operating Expenses Advertising and marketing 40,102 43,819 76,333 83,770 General and administrative 25,997 26,438 53,684 53,152 Depreciation and amortization 5,671 6,368 11,232 12,808 Total operating expenses 71,770 76,625 141,249 149,730 Operating income 88,250 84,384 173,444 171,398 Other expense Interest expense, net 17,606 16,979 35,325 32,271 Other (income) expense, net 229 812 (1,009) 1,637 Total other expense, net 17,835 17,791 34,316 33,908 Income before income taxes 70,415 66,593 139,128 137,490 Provision for income taxes 16,856 15,570 32,293 31,195 Net income$53,559 $51,023 $106,835 $106,295 Earnings per share: Basic$1.08 $1.02 $2.15 $2.12 Diluted$1.07 $1.02 $2.13 $2.11 Weighted average shares outstanding: Basic 49,687 49,804 49,727 50,033 Diluted 50,081 50,265 50,138 50,496 Comprehensive income, net of tax: Currency translation adjustments (3,784) (7,118) (4,430) (16,637)Net loss on termination of pension plan — — — (790)Total other comprehensive loss (3,784) (7,118) (4,430) (17,427)Comprehensive income$49,775 $43,905 $102,405 $88,868 Prestige Consumer Healthcare Inc.Condensed Consolidated Balance Sheets(Unaudited) (In thousands)September 30, 2023 March 31, 2023 Assets Current assets Cash and cash equivalents$60,067 $58,489Accounts receivable, net of allowance of $21,994 and $20,205, respectively 158,456 167,016Inventories 161,283 162,121Prepaid expenses and other current assets 8,392 4,117Total current assets 388,198 391,743 Property, plant and equipment, net 70,700 70,412Operating lease right-of-use assets 12,134 14,923Finance lease right-of-use assets, net 2,870 4,200Goodwill 526,860 527,553Intangible assets, net 2,328,250 2,341,893Other long-term assets 3,862 3,005Total Assets$3,332,874 $3,353,729 Liabilities and Stockholders' Equity Current liabilities Accounts payable 44,381 62,743Accrued interest payable 15,635 15,688Operating lease liabilities, current portion 6,732 6,926Finance lease liabilities, current portion 2,876 2,834Other accrued liabilities 60,080 72,524Total current liabilities 129,704 160,715 Long-term debt, net 1,262,972 1,345,788Deferred income tax liabilities 388,481 380,434Long-term operating lease liabilities, net of current portion 6,644 9,876Long-term finance lease liabilities, net of current portion 218 1,667Other long-term liabilities 8,896 8,165Total Liabilities 1,796,915 1,906,645 Total Stockholders' Equity 1,535,959 1,447,084Total Liabilities and Stockholders' Equity$3,332,874 $3,353,729 Prestige Consumer Healthcare Inc.Condensed Consolidated Statements of Cash Flows(Unaudited) Six Months Ended September 30,(In thousands) 2023 2022 Operating Activities Net income$106,835 $106,295 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 15,186 16,632 Loss on disposal of property and equipment 191 94 Deferred income taxes 9,721 4,211 Amortization of debt origination costs 2,302 1,798 Stock-based compensation costs 7,834 7,323 Non-cash operating lease cost 2,816 2,984 Other — 447 Changes in operating assets and liabilities: Accounts receivable 4,415 (8,276)Inventories 223 (21,810)Prepaid expenses and other current assets (3,814) (1,501)Accounts payable (18,820) 1,016 Accrued liabilities (11,764) 9,788 Operating lease liabilities (3,493) (3,201)Other (1,085) (13)Net cash provided by operating activities 110,547 115,787 Investing Activities Purchases of property, plant and equipment (4,411) (3,423)Other 3,800 — Net cash provided by (used in) investing activities (611) (3,423) Financing Activities Term loan repayments (85,000) (40,000)Borrowings under revolving credit agreement — 20,000 Repayments under revolving credit agreement — (20,000)Payments of finance leases (1,403) (1,369)Proceeds from exercise of stock options 9,183 1,489 Fair value of shares surrendered as payment of tax withholding (5,508) (5,450)Repurchase of common stock (25,000) (50,000)Net cash used in financing activities (107,728) (95,330) Effects of exchange rate changes on cash and cash equivalents (630) (1,777)Increase (decrease) in cash and cash equivalents 1,578 15,257 Cash and cash equivalents - beginning of period 58,489 27,185 Cash and cash equivalents - end of period$60,067 $42,442 Interest paid$33,706 $19,016 Income taxes paid$25,118 $15,689 Prestige Consumer Healthcare Inc.Condensed Consolidated Statements of IncomeBusiness Segments(Unaudited) Three Months Ended September 30, 2023(In thousands)North American OTCHealthcare International OTCHealthcare ConsolidatedTotal segment revenues*$244,423 $41,893 $286,316Cost of sales 107,466 18,830 126,296Gross profit 136,957 23,063 160,020Advertising and marketing 35,389 4,713 40,102Contribution margin$101,568 $18,350 $119,918Other operating expenses 31,668Operating income $88,250 *Intersegment revenues of $0.6 million were eliminated from the North American OTC Healthcare segment. Six Months Ended September 30, 2023(In thousands)North American OTC Healthcare International OTC Healthcare ConsolidatedTotal segment revenues*$490,566 $75,059 $565,625Cost of sales 217,542 33,390 250,932Gross profit 273,024 41,669 314,693Advertising and marketing 66,790 9,543 76,333Contribution margin$206,234 $32,126 $238,360Other operating expenses 64,916Operating income $173,444 *Intersegment revenues of $2.0 million were eliminated from the North American OTC Healthcare segment. Three Months Ended September 30, 2022(In thousands)North American OTC Healthcare International OTC Healthcare ConsolidatedTotal segment revenues*$252,054 $37,219 $289,273Cost of sales 113,533 14,731 128,264Gross profit 138,521 22,488 161,009Advertising and marketing 39,316 4,503 43,819Contribution margin$99,205 $17,985 $117,190Other operating expenses 32,806Operating income $84,384 * Intersegment revenues of $1.1 million were eliminated from the North American OTC Healthcare segment. Six Months Ended September 30, 2022(In thousands)North American OTC Healthcare International OTC Healthcare ConsolidatedTotal segment revenues*$494,572 $71,760 $566,332Cost of sales 216,454 28,750 245,204Gross profit 278,118 43,010 321,128Advertising and marketing 74,728 9,042 83,770Contribution margin$203,390 $33,968 $237,358Other operating expenses 65,960Operating income $171,398 * Intersegment revenues of $1.7 million were eliminated from the North American OTC Healthcare segment. About Non-GAAP Financial Measures In addition to financial results reported in accordance with GAAP, we disclose certain Non-GAAP financial measures ("NGFMs"), including, but not limited to, Non-GAAP Organic Revenues, Non-GAAP Organic Revenue Change Percentage, Non-GAAP EBITDA, Non-GAAP EBITDA Margin, Non-GAAP Free Cash Flow, and Net Debt. We use these NGFMs internally, along with GAAP information, in evaluating our operating performance and in making financial and operational decisions. We believe that the presentation of these NGFMs provides investors with greater transparency, and provides a more complete understanding of our business than could be obtained absent these disclosures, because the supplemental data relating to our financial condition and results of operations provides additional ways to view our operation when considered with both our GAAP results and the reconciliations below. In addition, we believe that the presentation of each of these NGFMs is useful to investors for period-to-period comparisons of results in assessing shareholder value, and we use these NGFMs internally to evaluate the performance of our personnel and also to evaluate our operating performance and compare our performance to that of our competitors. These NGFMs are not in accordance with GAAP, should not be considered as a measure of profitability or liquidity, and may not be directly comparable to similarly titled NGFMs reported by other companies. These NGFMs have limitations and they should not be considered in isolation from or as an alternative to their most closely related GAAP measures reconciled below. Investors should not rely on any single financial measure when evaluating our business. We recommend investors review the GAAP financial measures included in this earnings release. When viewed in conjunction with our GAAP results and the reconciliations below, we believe these NGFMs provide greater transparency and a more complete understanding of factors affecting our business than GAAP measures alone. NGFMs Defined We define our NGFMs presented herein as follows: Non-GAAP Organic Revenues: GAAP Total Revenues excluding the impact of foreign currency exchange rates in the periods presented.Non-GAAP Organic Revenue Change Percentage: Calculated as the change in Non-GAAP Organic Revenues from prior year divided by prior year Non-GAAP Organic Revenues.Non-GAAP EBITDA: GAAP Net Income before interest expense, net, provision for income taxes, and depreciation and amortization.Non-GAAP EBITDA Margin: Calculated as Non-GAAP EBITDA divided by GAAP Total Revenues.Non-GAAP Free Cash Flow: Calculated as GAAP Net cash provided by operating activities less cash paid for capital expenditures.Net Debt: Calculated as total principal amount of debt outstanding ($1,275,000 at September 30, 2023) less cash and cash equivalents ($60,067 at September 30, 2023). Amounts in thousands. The following tables set forth the reconciliations of each of our NGFMs (other than Net Debt, which is reconciled above) to their most directly comparable financial measures presented in accordance with GAAP. Reconciliation of GAAP Total Revenues to Non-GAAP Organic Revenues and related Non-GAAP Organic Revenue Change percentage: Three Months Ended September 30, Six Months Ended September 30, 2023 2022 2023 2022 (In thousands) GAAP Total Revenues$286,316 $289,273 $565,625 $566,332 Revenue Change (1.0)% (0.1)% Adjustments: Impact of foreign currency exchange rates — (1,035) — (3,759)Total adjustments — (1,035) — (3,759)Non-GAAP Organic Revenues$286,316 $288,238 $565,625 $562,573 Non-GAAP Organic Revenue Change (0.7)% 0.5% Reconciliation of GAAP Net Income to Non-GAAP EBITDA and related Non-GAAP EBITDA Margin: Three Months Ended September 30, Six Months Ended September 30, 2023 2022 2023 2022 (In thousands) GAAP Net Income$53,559 $51,023 $106,835 $106,295 Interest expense, net 17,606 16,979 35,325 32,271 Provision for income taxes 16,856 15,570 32,293 31,195 Depreciation and amortization 7,643 8,248 15,186 16,632 Non-GAAP EBITDA$95,664 $91,820 $189,639 $186,393 Non-GAAP EBITDA Margin 33.4% 31.7% 33.5% 32.9% Reconciliation of GAAP Net Income to Non-GAAP Free Cash Flow: Three Months Ended September 30, Six Months Ended September 30, 2023 2022 2023 2022 (In thousands) GAAP Net Income$53,559 $51,023 $106,835 $106,295 Adjustments: Adjustments to reconcile net income to net cash provided by operating activities as shown in the Statement of Cash Flows 19,862 17,255 38,050 33,489 Changes in operating assets and liabilities as shown in the Statement of Cash Flows (10,961) (10,738) (34,338) (23,997)Total adjustments 8,901 6,517 3,712 9,492 GAAP Net cash provided by operating activities 62,460 57,540 110,547 115,787 Purchases of property and equipment (2,934) (2,376) (4,411) (3,423)Non-GAAP Free Cash Flow$59,526 $55,164 $106,136 $112,364 Outlook for Fiscal Year 2024: Reconciliation of Projected GAAP Net cash provided by operating activities to Projected Non-GAAP Free Cash Flow: (In millions) Projected FY'24 GAAP Net cash provided by operating activities$250 Additions to property and equipment for cash (10)Projected FY'24 Non-GAAP Free Cash Flow$240
Revenue of $286.3 Million in Q2, Ahead of OutlookDiluted EPS of $1.07 in Q2, Up Over 5% Versus Prior YearReduced Leverage Ratio to 3.0x at Quarter EndReaffirming Full-Year Fiscal 2024 Revenue, Earnings, and Cash Flow Outlook TARRYTOWN, N.Y., Nov. 02, 2023 (GLOBE NEWSWIRE) -- Prestige Consumer Healthcare Inc. (NYSE:PBH) today reported financial results for its second quarter and first six months ended September 30, 2023. “Our second quarter results build on a strong first quarter performance thanks to our diverse and leading portfolio of brands and broad distribution. This stable top-line performance was amplified by our strong financial model and resulted in second quarter mid-single-digit earnings growth versus prior year. The earnings growth translated into robust free cash flow that we used for debt reduction and resulting leverage which will enable further disciplined capital deployment,” said Ron Lombardi, Chief Executive Officer of Prestige Consumer Healthcare. Second Fiscal Quarter Ended September 30, 2023 Reported revenues in the second quarter of fiscal 2024 of $286.3 million compared to a record $289.3 million in the second quarter of fiscal 2023. Revenues decreased 0.7% versus the prior year second quarter excluding the impact of foreign currency. The revenue performance for the quarter was led by Cough & Cold and Ear & Eye Care category performances in North America and strong International OTC segment growth versus the prior year comparable period, offset by declines in certain other categories and the planned strategic exit of private label revenues. Reported net income for the second quarter of fiscal 2024 totaled $53.6 million, compared to the prior year second quarter’s net income of $51.0 million. Diluted earnings per share of $1.07 for the second quarter of fiscal 2024 increased 5.4% versus $1.02 in the prior year comparable period. Six Months Ended September 30, 2023 Reported revenues for the first six months of fiscal 2024 totaled $565.6 million and compared to revenues of $566.3 million for the first six months of fiscal 2023. Revenues increased 0.5% versus the prior year six-month period, excluding the impact of foreign currency. The revenue growth for the first six months was driven by International OTC segment performance and strong Dermatological category sales in North America, offset by lower Women’s Health category sales and the strategic exit of private label revenues. Reported net income for the first six months of fiscal 2024 totaled $106.8 million versus the prior year comparable period net income of $106.3 million. Diluted earnings per share were $2.13 for the first six months of fiscal 2024 increased compared to diluted earnings per share of $2.11 in the prior year comparable period. Free Cash Flow and Balance Sheet The Company's net cash provided by operating activities for the second quarter fiscal 2024 was $62.5 million, compared to $57.5 million during the prior year comparable period. Non-GAAP free cash flow in the second quarter of fiscal 2024 was $59.5 million compared to $55.2 million in the prior year second quarter. The Company's net cash provided by operating activities for the first six months of fiscal 2024 was $110.5 million, compared to $115.8 million during the prior year comparable period. Non-GAAP free cash flow in the first six months of fiscal 2024 was $106.1 million compared to $112.4 million in the prior year comparable period, with the change attributable to the timing of working capital. In the first quarter fiscal 2024, the Company repurchased approximately 0.4 million shares at a total investment of $25.0 million, completing its previously authorized share repurchase program. The Company's net debt position as of September 30, 2023 was approximately $1.2 billion, resulting in a covenant-defined leverage ratio of 3.0x. Segment Review North American OTC Healthcare: Segment revenues of $244.4 million for the second quarter fiscal 2024 decreased 3.0% compared to the prior year comparable quarter's record segment revenues of $252.1 million. The revenue performance for the quarter was driven by lower sales in Women’s Health and certain other categories as well as the strategic exit of private label, partially offset by strong performance in the Cough & Cold and Ear & Eye Care categories. For the first six months of the current fiscal year, reported revenues for the North American OTC segment were $490.6 million, which compared to $494.6 million in the prior year comparable period. The change was attributable to lower sales in the Women’s Health category, partially offset by higher sales in other categories including Dermatologicals, Ear & Eye Care, and Gastrointestinal. International OTC Healthcare: Fiscal second quarter 2024 segment revenues were $41.9 million compared to $37.2 million reported in the prior year comparable period. The increase in revenue versus the prior year second quarter was driven by strong Eye & Ear Care and Women’s Health sales, partially offset by a $0.7 million currency headwind. For the first six months of the current fiscal year, reported revenues for the International OTC Healthcare segment were $75.1 million, an increase of approximately 5% over the prior year comparable period’s revenues of $71.8 million or an increase of 8.5% after excluding the impact a $2.6M foreign currency headwind. The strong sales growth exceeded the Company’s long-term growth expectation for the segment. Commentary Reaffirming Outlook for Fiscal 2024 Ron Lombardi, Chief Executive Officer, stated, “We were pleased with our top-line performance against a record result in Q2 of the prior year. This was driven by our continued brand-building efforts and growth in multiple categories including Cough & Cold and Ear & Eye Care as well as our International segment. The resulting strong profitability and free cash flow enabled our continued disciplined capital deployment, which reduced debt by $55 million in the quarter and improved our leverage to 3.0x and the end of September.” “Looking ahead, we are reaffirming our fiscal 2024 outlook that includes solid sales and earnings growth expectations. While we anticipate a continued dynamic macro environment, our diverse portfolio of brands in a resilient needs-based section of the store leave us well positioned to continue to create long-term shareholder value,” Mr. Lombardi concluded. Reaffirmed Fiscal 2024 Outlook Revenue$1,135 to $1,140 million Organic Revenue Growth1% to 2% Diluted E.P.S.$4.27 to $4.32 Free Cash Flow$240 million or more Fiscal Second Quarter 2024 Conference Call, Accompanying Slide Presentation and Replay The Company will host a conference call to review its second quarter fiscal 2024 results today, November 2, 2023 at 8:30 a.m. ET. The Company provides a live Internet webcast, a slide presentation to accompany the call, as well as an archived replay, all of which can be accessed from the Investor Relations page of the Company's website at www.prestigeconsumerhealthcare.com. To participate in the conference call via phone, participants may register for the call here to receive dial-in details and a unique pin. While not required, it is recommended to join 10 minutes prior to the event start. The slide presentation can be accessed from the Investor Relations page of the website by clicking on Webcasts and Presentations. A conference call replay will be available for approximately one week following completion of the live call and can be accessed on the Company’s Investor Relations page. Non-GAAP and Other Financial InformationIn addition to financial results reported in accordance with generally accepted accounting principles (GAAP), we have provided certain non-GAAP financial information in this release to aid investors in understanding the Company's performance. Each non-GAAP financial measure is defined and reconciled to its most closely related GAAP financial measure in the “About Non-GAAP Financial Measures” section at the end of this earnings release. Note Regarding Forward-Looking Statements This news release contains "forward-looking statements" within the meaning of the federal securities laws 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 "outlook," "projected," "may," "will," "would," "expect," "anticipate," 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 operating results including revenues, organic growth, diluted earnings per share, and free cash flow, the Company’s disciplined capital deployment, the Company’s brand-building efforts, the impact of the macro environment, and the Company’s ability to create shareholder value. 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, including the impact of business and economic conditions, including as a result of labor shortages, inflation and geopolitical instability, consumer trends, the impact of the Company’s advertising and marketing and new product development initiatives, customer inventory management initiatives, fluctuating foreign exchange rates, competitive pressures, and the ability of the Company’s manufacturing operations and third party manufacturers and logistics providers and suppliers to meet demand for its products and to avoid inflationary cost increases and disruption as a result of labor shortages. A discussion of other factors that could cause results to vary is included in the Company’s Annual Report on Form 10-K for the year ended March 31, 2023 and other periodic reports filed with the Securities and Exchange Commission. About Prestige Consumer Healthcare Inc.Prestige Consumer Healthcare is a leading consumer healthcare products company with sales throughout the U.S. and Canada, Australia, and in certain other international markets. The Company’s diverse portfolio of brands include Monistat® and Summer’s Eve® women’s health products, BC® and Goody's® pain relievers, Clear Eyes® and TheraTears® eye care products, DenTek® specialty oral care products, Dramamine® motion sickness treatments, Fleet® enemas and glycerin suppositories, Chloraseptic® and Luden’s® sore throat treatments and drops, Compound W® wart treatments, Little Remedies® pediatric over-the-counter products, Boudreaux’s Butt Paste® diaper rash ointments, Nix® lice treatment, Debrox® earwax remover, Gaviscon® antacid in Canada, and Hydralyte® rehydration products and the Fess® line of nasal and sinus care products in Australia. Visit the Company’s website at www.prestigeconsumerhealthcare.com. Investor Relations ContactPhil Terpolilli, CFA, 914-524-6819irinquiries@prestigebrands.com Prestige Consumer Healthcare Inc.Condensed Consolidated Statements of Income and Comprehensive Income(Unaudited) Three Months Ended September 30, Six Months Ended September 30,(In thousands, except per share data) 2023 2022 2023 2022 Total Revenues$286,316 $289,273 $565,625 $566,332 Cost of Sales Cost of sales excluding depreciation 124,324 126,384 246,978 241,380 Cost of sales depreciation 1,972 1,880 3,954 3,824 Cost of sales 126,296 128,264 250,932 245,204 Gross profit 160,020 161,009 314,693 321,128 Operating Expenses Advertising and marketing 40,102 43,819 76,333 83,770 General and administrative 25,997 26,438 53,684 53,152 Depreciation and amortization 5,671 6,368 11,232 12,808 Total operating expenses 71,770 76,625 141,249 149,730 Operating income 88,250 84,384 173,444 171,398 Other expense Interest expense, net 17,606 16,979 35,325 32,271 Other (income) expense, net 229 812 (1,009) 1,637 Total other expense, net 17,835 17,791 34,316 33,908 Income before income taxes 70,415 66,593 139,128 137,490 Provision for income taxes 16,856 15,570 32,293 31,195 Net income$53,559 $51,023 $106,835 $106,295 Earnings per share: Basic$1.08 $1.02 $2.15 $2.12 Diluted$1.07 $1.02 $2.13 $2.11 Weighted average shares outstanding: Basic 49,687 49,804 49,727 50,033 Diluted 50,081 50,265 50,138 50,496 Comprehensive income, net of tax: Currency translation adjustments (3,784) (7,118) (4,430) (16,637)Net loss on termination of pension plan — — — (790)Total other comprehensive loss (3,784) (7,118) (4,430) (17,427)Comprehensive income$49,775 $43,905 $102,405 $88,868 Prestige Consumer Healthcare Inc.Condensed Consolidated Balance Sheets(Unaudited) (In thousands)September 30, 2023 March 31, 2023 Assets Current assets Cash and cash equivalents$60,067 $58,489Accounts receivable, net of allowance of $21,994 and $20,205, respectively 158,456 167,016Inventories 161,283 162,121Prepaid expenses and other current assets 8,392 4,117Total current assets 388,198 391,743 Property, plant and equipment, net 70,700 70,412Operating lease right-of-use assets 12,134 14,923Finance lease right-of-use assets, net 2,870 4,200Goodwill 526,860 527,553Intangible assets, net 2,328,250 2,341,893Other long-term assets 3,862 3,005Total Assets$3,332,874 $3,353,729 Liabilities and Stockholders' Equity Current liabilities Accounts payable 44,381 62,743Accrued interest payable 15,635 15,688Operating lease liabilities, current portion 6,732 6,926Finance lease liabilities, current portion 2,876 2,834Other accrued liabilities 60,080 72,524Total current liabilities 129,704 160,715 Long-term debt, net 1,262,972 1,345,788Deferred income tax liabilities 388,481 380,434Long-term operating lease liabilities, net of current portion 6,644 9,876Long-term finance lease liabilities, net of current portion 218 1,667Other long-term liabilities 8,896 8,165Total Liabilities 1,796,915 1,906,645 Total Stockholders' Equity 1,535,959 1,447,084Total Liabilities and Stockholders' Equity$3,332,874 $3,353,729 Prestige Consumer Healthcare Inc.Condensed Consolidated Statements of Cash Flows(Unaudited) Six Months Ended September 30,(In thousands) 2023 2022 Operating Activities Net income$106,835 $106,295 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 15,186 16,632 Loss on disposal of property and equipment 191 94 Deferred income taxes 9,721 4,211 Amortization of debt origination costs 2,302 1,798 Stock-based compensation costs 7,834 7,323 Non-cash operating lease cost 2,816 2,984 Other — 447 Changes in operating assets and liabilities: Accounts receivable 4,415 (8,276)Inventories 223 (21,810)Prepaid expenses and other current assets (3,814) (1,501)Accounts payable (18,820) 1,016 Accrued liabilities (11,764) 9,788 Operating lease liabilities (3,493) (3,201)Other (1,085) (13)Net cash provided by operating activities 110,547 115,787 Investing Activities Purchases of property, plant and equipment (4,411) (3,423)Other 3,800 — Net cash provided by (used in) investing activities (611) (3,423) Financing Activities Term loan repayments (85,000) (40,000)Borrowings under revolving credit agreement — 20,000 Repayments under revolving credit agreement — (20,000)Payments of finance leases (1,403) (1,369)Proceeds from exercise of stock options 9,183 1,489 Fair value of shares surrendered as payment of tax withholding (5,508) (5,450)Repurchase of common stock (25,000) (50,000)Net cash used in financing activities (107,728) (95,330) Effects of exchange rate changes on cash and cash equivalents (630) (1,777)Increase (decrease) in cash and cash equivalents 1,578 15,257 Cash and cash equivalents - beginning of period 58,489 27,185 Cash and cash equivalents - end of period$60,067 $42,442 Interest paid$33,706 $19,016 Income taxes paid$25,118 $15,689 Prestige Consumer Healthcare Inc.Condensed Consolidated Statements of IncomeBusiness Segments(Unaudited) Three Months Ended September 30, 2023(In thousands)North American OTCHealthcare International OTCHealthcare ConsolidatedTotal segment revenues*$244,423 $41,893 $286,316Cost of sales 107,466 18,830 126,296Gross profit 136,957 23,063 160,020Advertising and marketing 35,389 4,713 40,102Contribution margin$101,568 $18,350 $119,918Other operating expenses 31,668Operating income $88,250 *Intersegment revenues of $0.6 million were eliminated from the North American OTC Healthcare segment. Six Months Ended September 30, 2023(In thousands)North American OTC Healthcare International OTC Healthcare ConsolidatedTotal segment revenues*$490,566 $75,059 $565,625Cost of sales 217,542 33,390 250,932Gross profit 273,024 41,669 314,693Advertising and marketing 66,790 9,543 76,333Contribution margin$206,234 $32,126 $238,360Other operating expenses 64,916Operating income $173,444 *Intersegment revenues of $2.0 million were eliminated from the North American OTC Healthcare segment. Three Months Ended September 30, 2022(In thousands)North American OTC Healthcare International OTC Healthcare ConsolidatedTotal segment revenues*$252,054 $37,219 $289,273Cost of sales 113,533 14,731 128,264Gross profit 138,521 22,488 161,009Advertising and marketing 39,316 4,503 43,819Contribution margin$99,205 $17,985 $117,190Other operating expenses 32,806Operating income $84,384 * Intersegment revenues of $1.1 million were eliminated from the North American OTC Healthcare segment. Six Months Ended September 30, 2022(In thousands)North American OTC Healthcare International OTC Healthcare ConsolidatedTotal segment revenues*$494,572 $71,760 $566,332Cost of sales 216,454 28,750 245,204Gross profit 278,118 43,010 321,128Advertising and marketing 74,728 9,042 83,770Contribution margin$203,390 $33,968 $237,358Other operating expenses 65,960Operating income $171,398 * Intersegment revenues of $1.7 million were eliminated from the North American OTC Healthcare segment. About Non-GAAP Financial Measures In addition to financial results reported in accordance with GAAP, we disclose certain Non-GAAP financial measures ("NGFMs"), including, but not limited to, Non-GAAP Organic Revenues, Non-GAAP Organic Revenue Change Percentage, Non-GAAP EBITDA, Non-GAAP EBITDA Margin, Non-GAAP Free Cash Flow, and Net Debt. We use these NGFMs internally, along with GAAP information, in evaluating our operating performance and in making financial and operational decisions. We believe that the presentation of these NGFMs provides investors with greater transparency, and provides a more complete understanding of our business than could be obtained absent these disclosures, because the supplemental data relating to our financial condition and results of operations provides additional ways to view our operation when considered with both our GAAP results and the reconciliations below. In addition, we believe that the presentation of each of these NGFMs is useful to investors for period-to-period comparisons of results in assessing shareholder value, and we use these NGFMs internally to evaluate the performance of our personnel and also to evaluate our operating performance and compare our performance to that of our competitors. These NGFMs are not in accordance with GAAP, should not be considered as a measure of profitability or liquidity, and may not be directly comparable to similarly titled NGFMs reported by other companies. These NGFMs have limitations and they should not be considered in isolation from or as an alternative to their most closely related GAAP measures reconciled below. Investors should not rely on any single financial measure when evaluating our business. We recommend investors review the GAAP financial measures included in this earnings release. When viewed in conjunction with our GAAP results and the reconciliations below, we believe these NGFMs provide greater transparency and a more complete understanding of factors affecting our business than GAAP measures alone. NGFMs Defined We define our NGFMs presented herein as follows: Non-GAAP Organic Revenues: GAAP Total Revenues excluding the impact of foreign currency exchange rates in the periods presented.Non-GAAP Organic Revenue Change Percentage: Calculated as the change in Non-GAAP Organic Revenues from prior year divided by prior year Non-GAAP Organic Revenues.Non-GAAP EBITDA: GAAP Net Income before interest expense, net, provision for income taxes, and depreciation and amortization.Non-GAAP EBITDA Margin: Calculated as Non-GAAP EBITDA divided by GAAP Total Revenues.Non-GAAP Free Cash Flow: Calculated as GAAP Net cash provided by operating activities less cash paid for capital expenditures.Net Debt: Calculated as total principal amount of debt outstanding ($1,275,000 at September 30, 2023) less cash and cash equivalents ($60,067 at September 30, 2023). Amounts in thousands. The following tables set forth the reconciliations of each of our NGFMs (other than Net Debt, which is reconciled above) to their most directly comparable financial measures presented in accordance with GAAP. Reconciliation of GAAP Total Revenues to Non-GAAP Organic Revenues and related Non-GAAP Organic Revenue Change percentage: Three Months Ended September 30, Six Months Ended September 30, 2023 2022 2023 2022 (In thousands) GAAP Total Revenues$286,316 $289,273 $565,625 $566,332 Revenue Change (1.0)% (0.1)% Adjustments: Impact of foreign currency exchange rates — (1,035) — (3,759)Total adjustments — (1,035) — (3,759)Non-GAAP Organic Revenues$286,316 $288,238 $565,625 $562,573 Non-GAAP Organic Revenue Change (0.7)% 0.5% Reconciliation of GAAP Net Income to Non-GAAP EBITDA and related Non-GAAP EBITDA Margin: Three Months Ended September 30, Six Months Ended September 30, 2023 2022 2023 2022 (In thousands) GAAP Net Income$53,559 $51,023 $106,835 $106,295 Interest expense, net 17,606 16,979 35,325 32,271 Provision for income taxes 16,856 15,570 32,293 31,195 Depreciation and amortization 7,643 8,248 15,186 16,632 Non-GAAP EBITDA$95,664 $91,820 $189,639 $186,393 Non-GAAP EBITDA Margin 33.4% 31.7% 33.5% 32.9% Reconciliation of GAAP Net Income to Non-GAAP Free Cash Flow: Three Months Ended September 30, Six Months Ended September 30, 2023 2022 2023 2022 (In thousands) GAAP Net Income$53,559 $51,023 $106,835 $106,295 Adjustments: Adjustments to reconcile net income to net cash provided by operating activities as shown in the Statement of Cash Flows 19,862 17,255 38,050 33,489 Changes in operating assets and liabilities as shown in the Statement of Cash Flows (10,961) (10,738) (34,338) (23,997)Total adjustments 8,901 6,517 3,712 9,492 GAAP Net cash provided by operating activities 62,460 57,540 110,547 115,787 Purchases of property and equipment (2,934) (2,376) (4,411) (3,423)Non-GAAP Free Cash Flow$59,526 $55,164 $106,136 $112,364 Outlook for Fiscal Year 2024: Reconciliation of Projected GAAP Net cash provided by operating activities to Projected Non-GAAP Free Cash Flow: (In millions) Projected FY'24 GAAP Net cash provided by operating activities$250 Additions to property and equipment for cash (10)Projected FY'24 Non-GAAP Free Cash Flow$240
