Lake Success-based Hain Celestial Group Inc. Wednesday reported robust third-quarter sales growth, and sharply higher earnings, driven by recent acquisitions and strong performance in the United States, United Kingdom, Europe and Canada.
The organic and natural products company, with brands including Celestial Seasonings, Earth’s Best, Terra and Spectrum, posted net sales of $749.9 million in the third quarter ended March 31, a 13.1 percent increase from $662.7 million in the same quarter a year ago. Net sales were reduced by $13.9 million from adverse foreign exchange rates.
Net income for the third quarter was $49 million, or 47 cents per share, an increase of nearly 47 percent from $33.4 million in the corresponding period in 2015.
“The diversification of our product portfolio with leading organic, natural and better-for-you brands around the world, combined with our team’s solid execution of our operational initiatives fueled our financial performance,” Hain Celestial CEO Irwin D. Simon said in a statement. He said during a conference call with analysts that Hain sells products in more than 70 countries.
Hain Celestial updated its fiscal 2016 revenue forecast of $2.946 billion to $2.966 billion, an increase of about 9 percent to 10 percent compared to fiscal 2015.
The company also announced a set of strategic initiatives dubbed Project Terra with the goal of saving $100 million in global costs during fiscal years 2017 through 2019. The initiatives include reducing the number of plants, and co-packer facilities. Newly appointed chief operations officer James R. Meiers will be in charge of achieving the cost savings.
The company has also identified low-volume brands, representing about $30 million in sales, which it intends to sell.
The company will also reorganize its business into five new groups it calls “platforms” — Fresh Living (poultry and yogurt), Better-for-You Baby (infant products), Better-for-You Snacking, Better-for-You Pantry, and Pure Personal Care. It will also launch a venture unit to invest in the company’s smaller brands, incubate small acquisitions, and invest in products and technology.
“We are excited about the launch of our new platforms in fiscal year 2017, which are uniquely aligned with consumer eating habits and usage needs,” Simon said in a statement. “We believe our platforms represent distinct opportunities for incremental growth and margin improvement.”
Shares of Hain rose $3.80, or 9.25 percent, to close at $44.89 Wednesday on the Nasdaq Stock Market. They are down about 26 percent in the past year.