Helen of Troy exceeded Wall Street estimates in its fourth quarter as the company pursues its ‘Elevate for Growth’ strategy.
Helen of Troy develops and markets personal care appliances, home environment appliances, housewares, beverageware and outdoor gear under such brands as Revlon, Honeywell, Pur (pictured above), Braun, Vicks, Oxo, Hydro Flask and Osprey.
Fourth quarter net income was $42.7 million, or $1.79 per diluted share, versus $36.2 million, or $1.50 per diluted share, in the year-prior period, the company reported. Adjusted for one-time events, net income was $58.6 million, or $2.45 per diluted share, versus $48.5 million, or $2.01 per diluted share, in the year-earlier quarter.
A Yahoo Finance-published analyst consensus estimate was for adjusted diluted earnings per share of $2.30 and revenue of $476.9 million.
Earnings per diluted share increased primarily due to higher operating income in the Helen of Troy’s Beauty and Wellness and Home and Outdoor businesses, lower interest expense, an increase in interest income and lower weighted average diluted shares outstanding, the company noted, partially offset by an increase in the effective income tax rate.
Consolidated revenue increased to $489.2 million from $484.6 million in the year-previous quarter, primarily driven by an increase in organic operations arising largely from growth in the consolidated online channel led by the travel tumbler in Home and Outdoor and hair appliances in Beauty and Wellness, international gains driven by thermometry, hair appliances and strong demand for travel packs, an increase in the club and closeout channels in Home and Outdoor, and prestige hair care growth in Beauty and Wellness. Declines in air purifiers, fan, and heaters primarily driven by SKU rationalization and softer consumer demand, and a decline in humidification reflecting a cough/cold/flu season illness incidence below the prior year and pre-COVID pandemic historical averages partially offset the gains, the company maintained.
Operating income increased to $66.2 million versus $53.7 million in the year-before quarter, while adjusted operating income was $83.3 million versus $66.7 million.
For the quarter, consolidated revenues were $223.3 million in the Home and Outdoor segment and $265.9 million in the Beauty and Wellness segment versus $211.9 million and $272.7 million, respectively, in the year-past quarter.
For the full fiscal year, net income was $168.6 million, or $7.03 per diluted share, versus $143.3 million, or $5.95 per diluted share, in the year prior, Helen of Troy stated. Adjusted net income was $213.5 million, or $8.91 per diluted share, versus $227.7 million, or $9.45 per diluted share, in the year earlier.
Consolidated revenue was $2.01 billion versus $2.07 billion in the year previous. Operating income was $260.6 million versus $211.8 million in the year before, while adjusted operating income was $301.5 million versus $300.9 million.
In the full year, consolidated revenue was $916.4 million in the Home and Outdoor segment and $1.09 billion in the Beauty and Wellness segment versus $915.7 million and $1.16 billion, respectively, in the year past.
In announcing the financial results, Noel Geoffroy, Helen of Troy CEO, said, “We ended the year on a positive note, reporting fourth-quarter results that exceeded our expectations while making critical progress toward our long-term growth and efficiency goals. The fourth quarter was highlighted by net sales and adjusted EPS ahead of our outlook, expanded gross profit and adjusted EBITDA margins, and strong cash flow generation that further strengthened our durable balance sheet. We are pleased to achieve these results despite an environment where consumers focused their more limited discretionary spending on experiences and services over products. I am proud of how our associates have embraced our new organizational model as a true global operating company designed to enable greater focus and centralized expertise.”
As the company looks forward through the current fiscal year, Geoffroy added, “We have many reasons to be excited as we begin our Elevate for Growth era, even as we navigate what we anticipate will be an increasingly pressured environment. Our consumers are our number one priority. Our mission is to delight them with quality brands and products with the right message in the right place at the right time. I am confident that Elevate for Growth represents an important pivot for the company, emphasizing relentless consumer obsession in all that we do, a new portfolio management approach to sharpen our resource allocation, incremental growth investment in our brands and our capabilities, and new distribution opportunities. We believe these new choices position us to deliver our objectives in fiscal 2025 and beyond.”
