Prestige Consumer Healthcare Inc Q4 2024 Financial Results

Ticker: PBH | Exchange: NYSE | Sector: Healthcare | Industry: Medical Distribution

Date: 2024-05-16 | Report Date: 2024-03-31

Executive Summary

Despite facing significant supply chain challenges in the final quarter, Prestige Consumer Healthcare Inc maintained strong financial performance for the fiscal year 2024. Key performance indicators such as revenue, net income, and cash flow remained stable, supported by the company's resilient portfolio of leading healthcare brands. However, unexpected disruptions in the supply chain impacted the results for Q4, specifically the Eye Care category.

Q4 2024 Financial Highlights

The revenue for the fourth quarter amounted to $277 million, a slight decline from the previous year's $285.9 million, representing a 2.9% decrease on an organic basis. The primary reason for this decline was the supply chain issues that hindered the company's ability to meet order demand in late Q4. Challenges in the Women's Health category and strategic exits from the private label business also contributed to the lower-than-expected revenue.

Despite these hurdles, the company reported a gross profit margin rate of 55.5%, in line with fiscal year expectations. Operating income was reported at $342.43 million, while net income for the quarter stood at $209.34 million, reflecting a stable profitability level amidst operational challenges.

Fiscal Year 2024 Performance

For the full fiscal year, Prestige Consumer Healthcare Inc generated $1.13 billion in revenue, showing a growth of 0.2% compared to the previous year when accounting for FX. The North American segment saw a slight decline of 1.5%, contrasted by an 11% increase in the International segment. The overall strong performance in the Ear & Eye Care, GI, and dermatological categories partially offset the Q4 supply chain disruptions.

The Gross Profit for FY 2024 was reported at $601.9 million, with an EBITDA of $373.10 million, equating to an EBITDA margin of 33.15%. Adjusted diluted EPS was consistent with the prior year's figure of $4.21. The company generated approximately $240 million in free cash flow, reaffirming its strong cash generation capability.

Capital Allocation and Debt Management

Prestige Consumer Healthcare Inc significantly reduced its net debt to $1.09 billion, achieving a leverage ratio of 2.8x, the lowest in the company’s history. This financial strength enables the company to explore various capital deployment opportunities to enhance shareholder value. An authorized share repurchase program of up to $300 million reflects the management's confidence in long-term profitable growth.

Supply Chain Disruptions

The supply chain disruptions in Q4 primarily affected the Eye Care category, where both Clear Eye suppliers faced simultaneous business interruptions related to maintenance and quality improvements. Although these pressures are expected to continue into the first half of FY 2025, they are seen as necessary measures to ensure long-term demand and quality needs.

Outlook for Fiscal Year 2025

Looking forward, intended revenue for FY 2025 is projected between $1.125 billion and $1.140 billion, with expected EPS growth of 5% to 6%. The company anticipates continuous solid consumption growth, supported by its proven brand-building strategy. Though near-term supply chain challenges may persist, Prestige Consumer Healthcare remains committed to its long-term objectives and strategic capital deployment.

For further information, please refer to the full earnings release and the accompanying slide presentation available on the company's website. You can access the detailed report through this link.