Cover page
Cover page - shares | 3 Months Ended | |
May 31, 2023 | Jun. 29, 2023 | |
Entity Addresses [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | May 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-14669 | |
Entity Registrant Name | HELEN OF TROY LIMITED | |
Entity Incorporation, State or Country Code | D0 | |
Entity Tax Identification Number | 74-2692550 | |
Entity Address, Address Line One | 1 Helen of Troy Plaza | |
Entity Address, City or Town | El Paso | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 79912 | |
City Area Code | 915 | |
Local Phone Number | 225-8000 | |
Title of 12(b) Security | Common Shares, $0.10 par value per share | |
Trading Symbol | HELE | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 24,099,376 | |
Entity Central Index Key | 0000916789 | |
Current Fiscal Year End Date | --02-28 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Other Address | ||
Entity Addresses [Line Items] | ||
Entity Address, Address Line One | Clarendon House | |
Entity Address, Address Line Two | 2 Church Street | |
Entity Address, City or Town | Hamilton | |
Entity Address, Country | BM |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | May 31, 2023 | Feb. 28, 2023 |
Assets, current: | ||
Cash and cash equivalents | $ 38,869 | $ 29,073 |
Receivables - principally trade, less allowances of $4,959 and $1,678 | 349,699 | 377,604 |
Inventory | 433,913 | 455,485 |
Prepaid expenses and other current assets | 24,458 | 24,721 |
Income taxes receivable | 9,118 | 5,158 |
Total assets, current | 856,057 | 892,041 |
Property and equipment, net of accumulated depreciation of $184,972 and $178,961 | 354,195 | 351,793 |
Goodwill | 1,066,730 | 1,066,479 |
Other intangible assets, net of accumulated amortization of $173,232 and $168,574 | 549,375 | 553,883 |
Operating lease assets | 37,362 | 38,751 |
Deferred tax assets, net | 2,757 | 2,781 |
Other assets | 6,352 | 7,987 |
Total assets | 2,872,828 | 2,913,715 |
Liabilities, current: | ||
Accounts payable, principally trade | 226,191 | 190,598 |
Accrued expenses and other current liabilities | 193,049 | 200,718 |
Income taxes payable | 15,316 | 14,778 |
Long-term debt, current maturities | 6,235 | 6,064 |
Total liabilities, current | 440,791 | 412,158 |
Long-term debt, excluding current maturities | 830,922 | 928,348 |
Lease liabilities, non-current | 41,322 | 42,672 |
Deferred tax liabilities, net | 30,789 | 28,048 |
Other liabilities, non-current | 14,096 | 13,678 |
Total liabilities | 1,357,920 | 1,424,904 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Cumulative preferred stock, non-voting, $1.00 par. Authorized 2,000,000 shares; none issued | 0 | 0 |
Common stock, $0.10 par. Authorized 50,000,000 shares; 24,096,946 and 23,994,405 shares issued and outstanding | 2,410 | 2,399 |
Additional paid in capital | 324,497 | 317,277 |
Accumulated other comprehensive income | 1,232 | 4,947 |
Retained earnings | 1,186,769 | 1,164,188 |
Total stockholders' equity | 1,514,908 | 1,488,811 |
Total liabilities and stockholders' equity | $ 2,872,828 | $ 2,913,715 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | May 31, 2023 | Feb. 28, 2023 |
Statement of Financial Position [Abstract] | ||
Allowance on receivables | $ 4,959 | $ 1,678 |
Property and equipment, accumulated depreciation | 184,972 | 178,961 |
Other intangible assets, accumulated amortization | $ 173,232 | $ 168,574 |
Cumulative preferred stock, nonvoting, par value (in dollars per share) | $ 1 | $ 1 |
Cumulative preferred stock, non-voting, authorized shares (in shares) | 2,000,000 | 2,000,000 |
Cumulative preferred stock, non-voting, issued shares (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.10 | $ 0.10 |
Common stock, authorized shares (in shares) | 50,000,000 | 50,000,000 |
Common stock, shares issued (in shares) | 24,096,946 | 23,994,405 |
Common stock, shares outstanding (in shares) | 24,096,946 | 23,994,405 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Income Statement [Abstract] | ||
Sales revenue, net | $ 474,672 | $ 508,078 |
Cost of goods sold | 259,041 | 296,907 |
Gross profit | 215,631 | 211,171 |
Selling, general and administrative expense (“SG&A”) | 167,635 | 177,230 |
Restructuring charges | 7,355 | 2 |
Operating income | 40,641 | 33,939 |
Non-operating income, net | 137 | 67 |
Interest expense | 14,052 | 4,373 |
Income before income tax | 26,726 | 29,633 |
Income tax expense | 4,145 | 5,038 |
Net income | $ 22,581 | $ 24,595 |
Earnings per share (“EPS”): | ||
Basic (in dollars per share) | $ 0.94 | $ 1.03 |
Diluted (in dollars per share) | $ 0.94 | $ 1.02 |
Weighted average shares used in computing EPS: | ||
Basic (in shares) | 24,049 | 23,865 |
Diluted (in shares) | 24,134 | 24,122 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 22,581 | $ 24,595 |
Other comprehensive (loss) income, net of tax: | ||
Cash flow hedge activity - interest rate swaps | (3,092) | 2,206 |
Cash flow hedge activity - foreign currency contracts | (623) | 953 |
Total other comprehensive (loss) income, net of tax | (3,715) | 3,159 |
Comprehensive income | $ 18,866 | $ 27,754 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid in Capital | Accumulated Other Comprehensive Income | Retained Earnings |
Beginning balance (in shares) at Feb. 28, 2022 | 23,800 | ||||
Beginning balance at Feb. 28, 2022 | $ 1,327,339 | $ 2,380 | $ 303,740 | $ 202 | $ 1,021,017 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 24,595 | 24,595 | |||
Other comprehensive income, net of tax | 3,159 | 3,159 | |||
Exercise of stock options (in shares) | 8 | ||||
Exercise of stock options | 659 | $ 1 | 658 | ||
Issuance and settlement of restricted stock (in shares) | 235 | ||||
Issuance and settlement of restricted stock | 0 | $ 24 | (24) | ||
Issuance of common stock related to stock purchase plan (in shares) | 13 | ||||
Issuance of common stock related to stock purchase plan | 2,275 | $ 1 | 2,274 | ||
Common stock repurchased and retired (in shares) | (89) | ||||
Common stock repurchased and retired | (18,224) | $ (9) | (18,113) | (102) | |
Share-based compensation | 16,619 | 16,619 | |||
Ending balance (in shares) at May. 31, 2022 | 23,967 | ||||
Ending balance at May. 31, 2022 | 1,356,422 | $ 2,397 | 305,154 | 3,361 | 1,045,510 |
Beginning balance (in shares) at Feb. 28, 2023 | 23,994 | ||||
Beginning balance at Feb. 28, 2023 | 1,488,811 | $ 2,399 | 317,277 | 4,947 | 1,164,188 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 22,581 | 22,581 | |||
Other comprehensive income, net of tax | (3,715) | (3,715) | |||
Exercise of stock options (in shares) | 5 | ||||
Exercise of stock options | 212 | $ 1 | 211 | ||
Issuance and settlement of restricted stock (in shares) | 120 | ||||
Issuance and settlement of restricted stock | 0 | $ 12 | (12) | ||
Issuance of common stock related to stock purchase plan (in shares) | 23 | ||||
Issuance of common stock related to stock purchase plan | 2,168 | $ 2 | 2,166 | ||
Common stock repurchased and retired (in shares) | (45) | ||||
Common stock repurchased and retired | (4,446) | $ (4) | (4,442) | 0 | |
Share-based compensation | 9,297 | 9,297 | |||
Ending balance (in shares) at May. 31, 2023 | 24,097 | ||||
Ending balance at May. 31, 2023 | $ 1,514,908 | $ 2,410 | $ 324,497 | $ 1,232 | $ 1,186,769 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Cash provided (used) by operating activities: | ||
Net income | $ 22,581 | $ 24,595 |
Adjustments to reconcile net income to net cash provided (used) by operating activities: | ||
Depreciation and amortization | 10,715 | 10,498 |
Amortization of financing costs | 308 | 253 |
Non-cash operating lease expense | 2,338 | 2,543 |
Provision for credit losses | 3,389 | 320 |
Non-cash share-based compensation | 9,297 | 16,619 |
Gain on sale of Personal Care business | 0 | (1,336) |
Gain on the sale or disposal of property and equipment | (246) | 0 |
Deferred income taxes and tax credits | 3,897 | 614 |
Changes in operating capital, net of effects of acquisitions of businesses: | ||
Receivables | 26,733 | (14,639) |
Inventory | 21,572 | (47,781) |
Prepaid expenses and other current assets | (1,420) | 651 |
Other assets and liabilities, net | (656) | (823) |
Accounts payable | 36,644 | 10,027 |
Accrued expenses and other current liabilities | (10,734) | (28,764) |
Accrued income taxes | (3,362) | (11,205) |
Net cash provided (used) by operating activities | 121,056 | (38,428) |
Cash used by investing activities: | ||
Capital and intangible asset expenditures | (11,877) | (76,202) |
Net payments to acquire businesses, net of cash acquired | 0 | (148,111) |
Proceeds from sale of Personal Care business | 0 | 1,804 |
Proceeds from the sale of property and equipment | 246 | 0 |
Net cash used by investing activities | (11,631) | (222,509) |
Cash (used) provided by financing activities: | ||
Proceeds from revolving loans | 70,150 | 447,000 |
Repayment of revolving loans | (166,150) | (153,000) |
Repayment of long-term debt | (1,563) | (1,900) |
Proceeds from share issuances under share-based compensation plans | 2,380 | 2,934 |
Payments for repurchases of common stock | (4,446) | (18,224) |
Net cash (used) provided by financing activities | (99,629) | 276,810 |
Net increase in cash and cash equivalents | 9,796 | 15,873 |
Cash and cash equivalents, beginning balance | 29,073 | 33,381 |
Cash and cash equivalents, ending balance | 38,869 | 49,254 |
Supplemental non-cash investing activity: | ||
Capital expenditures included in accounts payable | $ 2,579 | $ 12,812 |
Basis of Presentation and Relat
Basis of Presentation and Related Information | 3 Months Ended |
May 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Related Information | Note 1 - Basis of Presentation and Related Information Corporate Overview The accompanying condensed consolidated financial statements contain all adjustments (consisting of normal recurring adjustments) necessary to present fairly our consolidated financial position as of May 31, 2023 and February 28, 2023, and the results of our consolidated operations for the interim periods presented. We follow the same accounting policies when preparing quarterly financial data as we use for preparing annual data. These statements should be read in conjunction with the consolidated financial statements and the notes included in our latest annual report on Form 10-K for the fiscal year ended February 28, 2023 (“Form 10-K”), and our other reports on file with the Securities and Exchange Commission (the “SEC”). When used in these notes, unless otherwise indicated or the context suggests otherwise, references to “the Company”, “our Company”, “Helen of Troy”, “we”, “us”, or “our” refer to Helen of Troy Limited and its subsidiaries, which are all wholly-owned. We refer to our common shares, par value $0.10 per share, as “common stock.” References to “the FASB” refer to the Financial Accounting Standards Board. References to “GAAP” refer to accounting principles generally accepted in the United States of America (the “U.S.”). References to “ASU” refer to the codification of GAAP in the Accounting Standards Updates issued by the FASB. References to “ASC” refer to the codification of GAAP in the Accounting Standards Codification issued by the FASB. We incorporated as Helen of Troy Corporation in Texas in 1968 and were reorganized as Helen of Troy Limited in Bermuda in 1994. We are a leading consumer products company offering creative products and solutions for our customers through a diversified portfolio of brands. As of May 31, 2023, we operated two reportable segments: Home & Outdoor and Beauty & Wellness. During the fourth quarter of fiscal 2023, we made changes to the structure of our organization in connection with our global restructuring plan (as further described below and in Note 7) that resulted in our previous Health & Wellness and Beauty operating segments being combined into a single reportable segment, which is referred to herein as “Beauty & Wellness.” In connection with these organizational structure changes, corresponding changes were made to how our business is managed, how results are reported internally and how our Chief Executive Officer (“CEO”), our chief operating decision maker, assesses performance and allocates resources. We believe that these changes better align internal resources and external go to market activities in order to create a more efficient and effective organizational structure. There were no changes to the products or brands included within our Home & Outdoor reportable segment as part of these organizational changes nor to the way in which our CEO assesses performance and allocates resources for the Home & Outdoor segment. As a result of these changes, our disclosures reflect two reportable segments, Home & Outdoor and Beauty & Wellness. Comparative prior period segment information in this report has been recast to conform to this change in our reportable segments. Our external reportable segments will continue to align with our internal reporting to enable users of the financial statements to better understand our performance, better assess our future net cash flows, and make more informed judgments about the Company as a whole. Our Home & Outdoor segment provides a broad range of outstanding world-class brands that help consumers enjoy an outdoor lifestyle and make everyday living better. Our innovative products for home activities include food preparation, cooking, cleaning, organization, and beverage service. Our outdoor performance range includes hydration products, backpacks, and travel gear to ease your journey and inspire your next adventure. The Beauty & Wellness segment provides consumers with a broad range of outstanding world-class brands for beauty and wellness. In Beauty, we deliver innovation through products such as hair styling appliances, grooming tools, and liquid-, solid-, and powder-based personal care products that help make everyone look and feel more beautiful. On the Wellness side, we are there when you need us most with highly regarded humidifiers, thermometers, water and air purifiers, heaters, and fans. Our business is seasonal due to different calendar events, holidays and seasonal weather patterns. Our fiscal reporting period ends on the last day in February. Historically, our highest sales volume and operating income occur in our third fiscal quarter ending November 30th. We purchase our products from unaffiliated manufacturers, most of which are located in China, Mexico, Vietnam and the U.S. During the second quarter of fiscal 2023, we focused on developing a global restructuring plan intended to expand operating margins through initiatives designed to improve efficiency and reduce costs (referred to as “Project Pegasus”). See Note 7 for additional information. On April 22, 2022, we completed the acquisition of Recipe Products Ltd., a producer of innovative prestige hair care products for all types of curly and wavy hair under the Curlsmith brand (“Curlsmith”). The total purchase consideration was $147.9 million in cash, net of a final net working capital adjustment and cash acquired. The Curlsmith brand and products were added to the Beauty & Wellness segment. See Note 3 for additional information. During fiscal 2022 and fiscal 2023, we divested certain assets within our Beauty & Wellness segment's mass channel personal care business, which included liquid, powder and aerosol products under brands such as Pert, Brut, Sure and Infusium (“Personal Care”). On June 7, 2021, we completed the sale of our North America Personal Care business to HRB Brands LLC, for $44.7 million in cash and recognized a gain on the sale in SG&A totaling $0.5 million. On March 25, 2022, we completed the sale of the Latin America and Caribbean Personal Care business to HRB Brands LLC, for $1.8 million in cash and recognized a gain on the sale in SG&A totaling $1.3 million. Principles of Consolidation The accompanying condensed consolidated financial statements are prepared in accordance with GAAP and include all of our subsidiaries. Our condensed consolidated financial statements are prepared in U.S. Dollars. All intercompany balances and transactions are eliminated in consolidation. The preparation of consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in our condensed consolidated financial statements and accompanying notes. Actual results may differ materially from those estimates. Reclassifications We have reclassified or combined certain amounts in the prior year's accompanying footnotes to conform with the current year's presentation. |
New Accounting Pronouncements
New Accounting Pronouncements | 3 Months Ended |
May 31, 2023 | |
Accounting Changes and Error Corrections [Abstract] | |
New Accounting Pronouncements | Note 2 - New Accounting Pronouncements Except for the changes discussed below, there have been no changes in the information provided in our Form 10-K. Adopted In September 2022, the FASB issued ASU 2022-04, Liabilities—Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations , which requires a buyer in a supplier finance program to disclose qualitative and quantitative information about its program to allow a user of the financial statements to understand the program’s nature, activity during the period, changes from period to period, and potential magnitude. The amendments in ASU 2022-04 are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022, with the exception for the amendment on rollforward information, which is effective for fiscal years beginning after December 15, 2023. The guidance should be applied retrospectively, except for the amendment on rollforward information, which should be applied prospectively. This ASU was effective for us in the first quarter of fiscal 2024, with the exception of the amendment on rollforward information, which will be effective for us in our Form 10-K for fiscal 2025. We adopted this ASU during the first quarter of fiscal 2024 and the adoption did not have an impact on our consolidated financial statement disclosures. In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers , which requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASC 606, Revenue from Contracts with Customers . Prior to the issuance of this guidance, contract assets and contract liabilities were recognized by the acquirer at fair value on the acquisition date. The amendments in ASU 2021-08 are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022, and should be applied prospectively to acquisitions occurring on or after the effective date. We adopted this ASU during the first quarter of fiscal 2024 and the adoption did not have an impact on our consolidated financial statements. |
Acquisition of Curlsmith
Acquisition of Curlsmith | 3 Months Ended |
May 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisition of Curlsmith | Note 3 - Acquisition of Curlsmith On April 22, 2022, we completed the acquisition of Recipe Products Ltd., a producer of innovative prestige hair care products for all types of curly and wavy hair under the Curlsmith brand. Curlsmith's products are a category leader in the market for prestige haircare products for curly hair and include conditioners, shampoos and co-washes purposefully designed for the unique joys and challenges of all types of curls and textured hair. The Curlsmith brand and products were added to the Beauty & Wellness segment. The total purchase consideration was $147.9 million in cash, net of a final net working capital adjustment of $2.1 million and cash acquired. The acquisition was funded with cash on hand and borrowings under our existing revolving credit facility. We incurred pre-tax acquisition-related expenses of $2.7 million during the first quarter of fiscal 2023, which were recognized in SG&A within our condensed consolidated statement of income. We accounted for the acquisition as a purchase of a business and recorded the excess of the purchase price over the estimated fair value of the assets acquired and liabilities assumed as goodwill. The goodwill recognized is attributable primarily to expected synergies including leveraging our Beauty & Wellness segment's existing marketing and sales structure, as well as our global sourcing, distribution, shared service, and international go-to-market capabilities. The goodwill is not expected to be deductible for income tax purposes. We have determined the appropriate fair values of the acquired intangible assets and completed our analysis of the economic lives of the assets acquired. We assigned $21.0 million to trade names and are amortizing over a 20 year expected life. We assigned $12.0 million to customer relationships and are amortizing over a 19.5 year expected life, based on historical attrition rates. During fiscal 2023, we made adjustments to provisional asset and liability balances, which resulted in a corresponding net increase to goodwill of $0.1 million. We also finalized the net working capital adjustment during fiscal 2023, which resulted in a $1.8 million reduction to the total purchase consideration and goodwill. During the first quarter of fiscal 2024, we made final adjustments to provisional liability balances, which resulted in a corresponding increase to goodwill of $0.3 million. The following table presents the estimated fair values of assets acquired and liabilities assumed at the acquisition date: (in thousands) Assets: Receivables $ 4,211 Inventory 7,890 Prepaid expenses and other current assets 119 Property and equipment 212 Goodwill 117,108 Trade names - definite 21,000 Customer relationships - definite 12,000 Deferred tax assets, net 360 Total assets 162,900 Liabilities: Accounts payable 1,401 Accrued expenses and other current liabilities 2,813 Income taxes payable 2,572 Deferred tax liabilities, net 8,187 Total liabilities 14,973 Net assets recorded $ 147,927 Both the fair value and gross contractual amount of receivables acquired was $4.2 million, as an immaterial amount was expected to be uncollectible. The impact of the acquisition of Curlsmith on our condensed consolidated statements of income for the first quarter of fiscal 2023 was as follows: April 22, 2022 (acquisition date) through May 31, 2022 (in thousands, except earnings per share data) Three Months Ended May 31, 2022 (1) Sales revenue, net $ 3,246 Net income 439 EPS: Basic $ 0.02 Diluted $ 0.02 (1) Represents approximately six weeks of operating results from Curlsmith, acquired April 22, 2022. Net income and EPS amounts include allocations for corporate expenses, interest expense and income tax expense. The following supplemental unaudited pro forma information presents our financial results as if the acquisition of Curlsmith had occurred on March 1, 2021. This supplemental pro forma information has been prepared for comparative purposes and does not necessarily indicate what may have occurred if the acquisition had been completed on March 1, 2021, and this information is not intended to be indicative of future results. (in thousands, except earnings per share data) Three Months Ended May 31, 2022 Sales revenue, net $ 515,170 Net income 26,508 EPS: Basic $ 1.11 Diluted $ 1.10 |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 3 Months Ended |
May 31, 2023 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other Current Liabilities | Note 4 - Accrued Expenses and Other Current Liabilities A summary of accrued expenses and other current liabilities was as follows: (in thousands) May 31, 2023 February 28, 2023 Accrued compensation, benefits and payroll taxes $ 23,525 $ 17,380 Accrued sales discounts and allowances 52,473 63,881 Accrued sales returns 29,880 28,498 Accrued advertising 32,204 36,931 Other 54,967 54,028 Total accrued expenses and other current liabilities $ 193,049 $ 200,718 |
Share-Based Compensation Plans
Share-Based Compensation Plans | 3 Months Ended |
May 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Share-Based Compensation Plans | Note 5 - Share-Based Compensation Plans As part of our compensation structure, we grant share-based compensation awards to certain employees and non-employee members of our Board of Directors during the fiscal year. These awards may be subject to attainment of certain service conditions, performance conditions and/or market conditions. During the first quarter of fiscal 2024, we granted 94,807 service condition awards (“Service Condition Awards”) with a weighted average grant date fair value of $110.85. Additionally, we granted 252,522 performance-based awards during the first quarter of fiscal 2024, of which 126,318 contained performance conditions (“Performance Condition Awards”) and 126,204 contained market conditions (“Market Condition Awards”), with weighted average grant date fair values of $110.85 and $80.50, respectively. Refer to our Form 10-K for further information on the Company's share-based compensation plans. We recorded share-based compensation expense in SG&A as follows: Three Months Ended May 31, (in thousands) 2023 2022 Directors stock compensation $ 197 $ 173 Service Condition Awards 3,320 3,117 Performance Condition Awards 2,023 10,845 Market Condition Awards 3,147 1,910 Employee stock purchase plan 610 574 Share-based compensation expense 9,297 16,619 Less income tax benefits (641) (1,084) Share-based compensation expense, net of income tax benefits $ 8,656 $ 15,535 Unrecognized Share-Based Compensation Expense As of May 31, 2023, our total unrecognized share-based compensation for all awards was $41.4 million, which will be recognized over a weighted average amortization period of 2.1 years. The total unrecognized share-based compensation reflects an estimate of target achievement for Performance Condition Awards granted during the first quarter of fiscal 2024, and an estimate of zero percent of target achievement for Performance Condition Awards granted in fiscal 2023 and fiscal 2022. |
Repurchases of Common Stock
Repurchases of Common Stock | 3 Months Ended |
May 31, 2023 | |
Equity [Abstract] | |
Repurchases of Common Stock | Note 6 - Repurchases of Common Stock In August 2021, our Board of Directors authorized the repurchase of up to $500 million of our outstanding common stock. The authorization became effective August 25, 2021, for a period of three years, and replaced our former repurchase authorization. As of May 31, 2023, our repurchase authorization allowed for the purchase of $399.2 million of common stock. Our current equity-based compensation plans include provisions that allow for the “net exercise” of share-settled awards by all plan participants. In a net exercise, any required payroll taxes, federal withholding taxes and exercise price of the shares due from the option or other share-based award holders are settled by having the holder tender back to us a number of shares at fair value equal to the amounts due. Net exercises are treated as purchases and retirements of shares. The following table summarizes our share repurchase activity for the periods shown: Three Months Ended May 31, (in thousands, except share and per share data) 2023 2022 Common stock repurchased on the open market: Number of shares — — Aggregate value of shares $ — $ — Average price per share $ — $ — Common stock received in connection with share-based compensation: Number of shares 44,632 89,458 Aggregate value of shares $ 4,446 $ 18,224 Average price per share $ 99.61 $ 203.71 |
Restructuring Plan
Restructuring Plan | 3 Months Ended |
May 31, 2023 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Plan | Note 7 - Restructuring PlanDuring the second quarter of fiscal 2023, we focused on developing Project Pegasus, a global restructuring plan intended to expand operating margins through initiatives designed to improve efficiency and reduce costs. Project Pegasus includes initiatives to further optimize our brand portfolio, streamline and simplify the organization, accelerate cost of goods savings projects, enhance the efficiency of our supply chain network, optimize our indirect spending, and improve our cash flow and working capital, as well as other activities. We anticipate these initiatives will create operating efficiencies, as well as provide a platform to fund future growth investments. During the fourth quarter of fiscal 2023, we made changes to the structure of our organization in connection with Project Pegasus that resulted in our previous Health & Wellness and Beauty operating segments being combined into a single reportable segment, which is referred to herein as “Beauty & Wellness.” In connection with these organizational structure changes, corresponding changes were made to how our business is managed, how results are reported internally and how our CEO, our chief operating decision maker, assesses performance and allocates resources. We believe that these changes better align internal resources and external go to market activities in order to create a more efficient and effective organizational structure. There were no changes to the products or brands included within our Home & Outdoor reportable segment as part of these organizational changes. As part of our initiative focused on streamlining and simplifying the organization, we made further changes to the structure of our organization, during the fourth quarter of fiscal 2023, which include the creation of a North America Regional Market Organization (“RMO”) responsible for sales and go to market strategies for all categories and channels in the U.S. and Canada, and further centralization of certain functions under shared services, particularly in operations and finance to better support our business segments and RMOs. This new structure, inclusive of the organizational structure changes described above resulting in the reportable segment change, will reduce the size of our global workforce by approximately 10%. The majority of the role reductions were completed by March 1, 2023, and nearly all of the remaining role reductions are expected to be completed before the end of fiscal year 2024. We believe that these changes better focus business segment resources on brand development, consumer-centric innovation and marketing, the RMOs on sales and go to market strategies, and shared services on their respective areas of expertise while also creating a more efficient and effective organizational structure. We continue to have the following expectations regarding Project Pegasus: • Targeted annualized pre-tax operating profit improvements of approximately $75 million to $85 million, which we expect to substantially begin in fiscal 2024 and be substantially achieved by the end of fiscal 2026. • Estimated cadence of the recognition of the savings will be approximately 25% in fiscal 2024, approximately 50% in fiscal 2025 and approximately 25% in fiscal 2026. • Total profit improvements to be realized approximately 60% through reduced cost of goods sold and 40% through lower SG&A. • Total one-time pre-tax restructuring charges of approximately $85 million to $95 million over the duration of the plan, which are expected to be substantially completed by the end of fiscal 2024 and will primarily be comprised of severance and employee related costs, professional fees, contract termination costs, and other exit and disposal costs. • All of our operating segments and shared services will be impacted by the plan. During the three month period ended May 31, 2023, we incurred $7.4 million of pre-tax restructuring costs in connection with Project Pegasus, which were recorded as “Restructuring charges” in the condensed consolidated statement of income. The following table summarizes restructuring charges recorded as a result of Project Pegasus for the periods presented: Three Months Ended May 31, 2023 Total (in thousands) Home & Beauty & Wellness Total Severance and employee related costs $ 484 $ 408 $ 892 $ 10,345 Professional fees 2,269 3,357 5,626 22,375 Contract termination — 688 688 1,223 Other 37 112 149 774 Total restructuring charges $ 2,790 $ 4,565 $ 7,355 $ 34,717 The table below presents a rollforward of our accruals related to Project Pegasus, which are included in accounts payable and accrued expenses and other current liabilities: (in thousands) Balance at February 28, 2023 Charges Payments Balance at May 31, 2023 Severance and employee related costs $ 3,173 $ 892 $ (2,316) $ 1,749 Professional fees 3,201 5,626 (6,026) 2,801 Contract termination 160 688 (848) — Other 34 149 (183) — Total $ 6,568 $ 7,355 $ (9,373) $ 4,550 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
May 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 8 - Commitments and Contingencies Legal Matters We are involved in various legal claims and proceedings in the normal course of operations. We believe the outcome of these matters will not have a material adverse effect on our consolidated financial position, results of operations or liquidity, except as described below. On December 23, 2021, Brita LP filed a complaint against Kaz USA, Inc. and Helen of Troy Limited in the United States District Court for the Western District of Texas (the “Patent Litigation”), alleging patent infringement by the Company relating to its PUR gravity-fed water filtration systems. In the Patent Litigation, Brita LP seeks monetary damages and injunctive relief relating to the alleged infringement. Brita LP simultaneously filed a complaint with the United States International Trade Commission (“ITC”) against Kaz USA, Inc., Helen of Troy Limited and five other unrelated companies that sell water filtration systems (the “ITC Action”). The complaint in the ITC Action also alleges patent infringement by the Company with respect to a limited set of PUR gravity-fed water filtration systems. In the ITC Action, Brita LP requested the ITC to initiate an unfair import investigation relating to such filtration systems. This action seeks injunctive relief to prevent entry of certain accused PUR products (and certain other products) into the U.S. and cessation of marketing and sales of existing inventory that is already in the U.S. On January 25, 2022, the ITC instituted the investigation requested by the ITC Action. Discovery closed in the ITC Action in May 2022, and approximately half of the originally identified PUR gravity-fed water filters were removed from the case and are no longer included in the ITC Action. In August 2022, the parties participated in the evidentiary hearing, with additional supplemental hearings in October 2022. On February 28, 2023, the ITC issued an Initial Determination in the ITC Action, tentatively ruling against Kaz USA, Inc. and the other unrelated respondents. The ITC has a guaranteed review process, and thus all respondents, including Kaz USA, Inc., filed a petition with the ITC for a full review of the Initial Determination prior to the ITC making any final decision in this matter. On June 28, 2023, the ITC issued a Determination to review in part the Initial Determination and requested written submissions from the parties on certain issues under review. We intend to file the requested written submissions and then will await a final decision, which is now expected by September 19, 2023. The Patent Litigation has been stayed pending resolution of the ITC Action. While we intend to continue to vigorously pursue our claims and defenses in these proceedings, we have also implemented mitigation plans to help minimize the expected potential impact to the Company, its customers and consumers of a negative ITC decision. These mitigation plans include the introduction of an alternative replacement water filter that could be distributed to customers promptly following a potentially adverse ITC decision at the end of June. We cannot predict the outcome of these proceedings, the amount or range of any potential loss, when the proceedings will be resolved, or customer acceptance of any replacement water filter. Litigation is inherently unpredictable, and the resolution or disposition of these proceedings could, if adversely determined, have a material and adverse impact on our financial position and results of operations. Regulatory Matters Our operations are subject to national, state, local, and provincial jurisdictions’ environmental, health and safety laws and regulations and industry-specific product certifications. Many of the products we sell are subject to product safety laws and regulations in various jurisdictions. These laws and regulations specify the maximum allowable levels of certain materials that may be contained in our products, provide statutory prohibitions against misbranded and adulterated products, establish ingredients and manufacturing procedures for certain products, specify product safety testing requirements, and set product identification, labeling and claim requirements. Some product lines within our Beauty & Wellness segment are subject to product identification, labeling and claim requirements, which are monitored and enforced by regulatory agencies, such as the U.S. Environmental Protection Agency (the “EPA”), U.S. Customs and Border Protection, the U.S. Food and Drug Administration, and the U.S. Consumer Product Safety Commission. During fiscal 2022, we were in discussions with the EPA regarding the compliance of packaging claims on certain of our products in the air and water filtration categories and a limited subset of humidifier products within the Beauty & Wellness segment that are sold in the U.S. The EPA did not raise any product quality, safety or performance issues. As a result of these packaging compliance discussions, we voluntarily implemented a temporary stop shipment action on the impacted products as we worked with the EPA towards an expedient resolution. We resumed normalized levels of shipping of the affected inventory during fiscal 2022 and we completed the repackaging of our existing inventory of impacted products during fiscal 2023. Additionally, as a result of continuing dialogue with the EPA, we executed further repackaging and relabeling plans on certain additional humidifier products and certain additional air filtration products, which were also completed during fiscal 2023. Although we are not aware of any fines or penalties related to this matter imposed against us by the EPA at this time, there can be no assurances that such fines or penalties will not be imposed in the future. We recorded charges to cost of goods sold to write-off obsolete packaging for the affected products in our inventory on-hand and in-transit. We have also incurred additional compliance costs comprised of obsolete packaging, storage and other charges from vendors, which were recognized in cost of goods sold and incremental warehouse storage costs and legal fees, which were recognized in SG&A. We refer to these charges as “EPA compliance costs.” The following table provides a summary of EPA compliance costs incurred during the periods presented: Three Months Ended May 31, (in thousands) 2023 2022 Cost of goods sold $ — $ 9,455 1 SG&A — 2,189 Total EPA compliance costs $ — $ 11,644 (1) Includes a $4.4 million charge to write-off the obsolete packaging for the affected additional humidifier products and affected additional air filtration products in our inventory on-hand and in-transit as of the end of the first quarter of fiscal 2023. In addition, we incurred and capitalized into inventory costs to repackage a portion of our existing inventory of the affected products beginning in the second quarter of fiscal 2022 through completion of the repackaging in the third quarter of fiscal 2023. For additional information refer to Part I, Item 2., “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” including “EPA Compliance Costs”. Weather-Related Incident On March 30, 2022, a third-party facility that we utilize for inventory storage incurred severe damage from a weather-related incident. The inventory that was stored at this facility primarily related to our Beauty & Wellness segment. While the inventory was insured, some seasonal inventory and inventory designated for specific customer promotions was not accessible and subsequently determined to be damaged, and as a result, unfavorably impacted our net sales revenue during the first quarter of fiscal 2023. As a result of the damages to the inventory stored at the facility, we recorded a charge to write-off the damaged inventory totaling $34.4 million during the first quarter of fiscal 2023. These charges were fully offset by probable insurance recoveries of $34.4 million also recorded during the first quarter of fiscal 2023, which represented anticipated insurance proceeds, not to exceed the amount of the associated losses, for which receipt was deemed probable. The charges for the damaged inventory and the expected insurance recoveries are included in cost of goods sold in our condensed consolidated statement of income for the three months ended May 31, 2022. During the third and fourth quarters of fiscal 2023, we received proceeds totaling $46.0 million from our insurance carriers related to this incident, which were included in cash flows from operating activities in our condensed consolidated statements of cash flows. As a result, during the third quarter of fiscal 2023, the Company recorded a gain of $9.7 million, net of costs incurred to dispose of the inventory, as a reduction of SG&A expense in our condensed consolidated statement of income. |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
May 31, 2023 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Note 9 - Long-Term Debt A summary of our long-term debt follows: (in thousands) May 31, 2023 February 28, 2023 Credit Agreement (1): Revolving loans 594,000 690,000 Term loans 245,312 246,875 Total borrowings under Credit Agreement 839,312 936,875 Unamortized prepaid financing fees (2,155) (2,463) Total long-term debt 837,157 934,412 Less: current maturities of long-term debt (6,235) (6,064) Long-term debt, excluding current maturities $ 830,922 $ 928,348 (1) The weighted average interest rates on borrowings outstanding under the Credit Agreement (defined below) as of May 31, 2023 and February 28, 2023 were 6.8% and 6.6%, respectively. Capitalized Interest During the three month periods ended May 31, 2023 and 2022, we incurred interest costs totaling $14.9 million and $5.1 million, respectively, of which we capitalized $0.9 million and $0.7 million, respectively, as part of property and equipment in connection with the construction of a new distribution facility. Credit Agreement We have a credit agreement (the “Credit Agreement”) with Bank of America, N.A., as administrative agent, and other lenders that provides for an unsecured total revolving commitment of $1.25 billion and a $300 million accordion, which can be used for term loan commitments. In June 2022, we exercised $250 million of the $300 million accordion under the Credit Agreement and borrowed $250 million as term loans. The proceeds from the term loans were used to repay revolving loans under the Credit Agreement. The term loans are payable at the end of each fiscal quarter in equal installments of 0.625% of the term loans made, which began in the third quarter of fiscal 2023, with the remaining balance due at the maturity date. The maturity date of the term loans and the revolving loans under the Credit Agreement is March 13, 2025. Borrowings under the Credit Agreement bear floating interest at either the Base Rate or Term SOFR (as defined in the Credit Agreement), plus a margin based on the Net Leverage Ratio (as defined in the Credit Agreement) of 0% to 1.0% and 1.0% to 2.0% for Base Rate and Term SOFR borrowings, respectively, plus a credit spread of 0.10% for Term SOFR borrowings. The floating interest rates on our borrowings under the Credit Agreement are hedged with interest rate swaps to effectively fix interest rates on $625 million and $425 million of the outstanding principal balance under the revolving loans as of May 31, 2023 and February 28, 2023, respectively. See Notes 10, 11, and 12 for additional information regarding our interest rate swaps. As of May 31, 2023, the balance of outstanding letters of credit was $18.2 million and the amount available for revolving loans under the Credit Agreement was $637.8 million. Covenants in the Credit Agreement limit the amount of total indebtedness we can incur. As a result of our exercise of a qualified acquisition notice under the Credit Agreement, as of May 31, 2023, these covenants effectively limited our ability to incur more than $343.0 million of additional debt from all sources, including the Credit Agreement. Debt Covenants As of May 31, 2023, we were in compliance with all covenants as defined under the terms of the Credit Agreement. |
Fair Value
Fair Value | 3 Months Ended |
May 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Note 10 - Fair Value Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Valuation techniques under the accounting guidance related to fair value measurements are based on observable and unobservable inputs. These inputs are classified into the following hierarchy: Level 1: Quoted prices for identical assets or liabilities in active markets; Level 2: Observable inputs other than quoted prices that are directly or indirectly observable for the asset or liability, including quoted prices for similar assets or liabilities in active markets; quoted prices for similar or identical assets or liabilities in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable; and Level 3: Unobservable inputs that reflect the reporting entity’s own assumptions. Our financial assets and liabilities are classified as Level 2 because their valuation is dependent on observable inputs and other quoted prices for similar assets or liabilities, or model-derived valuations whose significant value drivers are observable. The following table presents the carrying amount and fair value of our financial assets and liabilities measured and recorded at fair value on a recurring basis and classified as Level 2: Carrying Amount and Fair Value (in thousands) May 31, 2023 February 28, 2023 Assets: Cash equivalents (money market accounts) $ 10,745 $ 381 Interest rate swaps 2,527 5,746 Foreign currency derivatives 1,081 1,423 Total assets $ 14,353 $ 7,550 Liabilities: Interest rate swaps $ 822 $ — Foreign currency derivatives 1,177 711 Total liabilities $ 1,999 $ 711 The carrying amounts of cash, accounts payable, accrued expenses and other current liabilities and income taxes payable approximate fair value because of the short maturity of these items. The carrying amounts of receivables approximate fair value due to the effect of the related allowance for credit losses. The carrying amount of our floating rate long-term debt approximates its fair value. We use derivatives to manage our exposure to changes in foreign currency exchange rates, which include foreign currency forward contracts and cross-currency debt swaps. In addition, we use interest rate swaps to manage our exposure to changes in interest rates. All of our derivative assets and liabilities are recorded at fair value. See Notes 11 and 12 for more information on our derivatives. |
Financial Instruments and Risk
Financial Instruments and Risk Management | 3 Months Ended |
May 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Financial Instruments and Risk Management | Note 11 - Financial Instruments and Risk Management Foreign Currency Risk The U.S. Dollar is the functional currency for the Company and all of its subsidiaries and is also the reporting currency for the Company. By operating internationally, we are subject to foreign currency risk from transactions denominated in currencies other than the U.S. Dollar (“foreign currencies”). Such transactions include sales and operating expenses. As a result of such transactions, portions of our cash, trade accounts receivable and trade accounts payable are denominated in foreign currencies. Approximately 15% and 13% of our net sales revenue was denominated in foreign currencies during the three month periods ended May 31, 2023 and 2022, respectively. These sales were primarily denominated in Euros, British Pounds and Canadian Dollars. We make most of our inventory purchases from manufacturers in Asia and primarily use the U.S. Dollar for such purchases. During the three month periods ended May 31, 2023 and 2022, we recorded foreign currency exchange rate net gains of $0.4 million and $0.2 million, respectively, in SG&A. We mitigate certain foreign currency exchange rate risk by using forward contracts and cross-currency debt swaps to protect against the foreign currency exchange rate risk inherent in our transactions denominated in foreign currencies. We do not enter into any derivatives or similar instruments for trading or other speculative purposes. Certain of our forward contracts are designated as cash flow hedges (“foreign currency contracts”) and are recorded on the balance sheet at fair value with changes in fair value recorded in Other Comprehensive Income (Loss) (“OCI”) until the hedge transaction is settled, at which point amounts are reclassified from Accumulated Other Comprehensive Income (Loss) (“AOCI”) to our condensed consolidated statements of income. Foreign currency derivatives for which we have not elected hedge accounting consist of our forward contracts and cross-currency debt swaps, and any changes in the fair value of these derivatives are recorded in our condensed consolidated statements of income. These undesignated derivatives are used to hedge monetary net asset and liability positions. Cash flows from our foreign currency derivatives are classified as cash flows from operating activities in our condensed consolidated statements of cash flows, which is consistent with the classification of the cash flows from the underlying hedged item. We evaluate our derivatives designated as cash flow hedges each quarter to assess hedge effectiveness. Interest Rate Risk Interest on our outstanding debt as of May 31, 2023 is based on floating interest rates. If short-term interest rates increase, we will incur higher interest expense on any future outstanding balances of floating rate debt. Floating interest rates are hedged with interest rate swaps to effectively fix interest rates on a portion of our outstanding principal balance under the Credit Agreement, which totaled $839.3 million and $936.9 million as of May 31, 2023 and February 28, 2023, respectively. As of May 31, 2023 and February 28, 2023, $625.0 million and $425.0 million of the outstanding principal balance under the Credit Agreement, respectively, was hedged with interest rate swaps to fix the interest rate we pay. Our interest rate swaps are designated as cash flow hedges and are recorded on the balance sheet at fair value with changes in fair value recorded in OCI until the hedge transaction is settled, at which point amounts are reclassified from AOCI to our condensed consolidated statements of income. Cash flows from our interest rate swaps are classified as cash flows from operating activities in our condensed consolidated statements of cash flows, which is consistent with the classification of the cash flows from the underlying hedged item. We evaluate our derivatives designated as cash flow hedges each quarter to assess hedge effectiveness. The following tables summarize the fair values of our derivative instruments as of the end of the periods presented: (in thousands) May 31, 2023 Derivatives designated as hedging instruments Hedge Final Notional Amount Prepaid Other Assets Accrued Other Forward contracts - sell Euro Cash flow 2/2024 € 27,350 $ 58 $ — $ 27 $ — Forward contracts - sell Canadian Dollars Cash flow 2/2024 $ 25,500 730 — — — Forward contracts - sell Pounds Cash flow 2/2024 £ 23,525 — — 1,150 — Forward contracts - sell Norwegian Kroner Cash flow 10/2023 kr 30,000 288 — — — Interest rate swaps Cash flow 2/2026 $ 625,000 2,527 — — 822 Subtotal 3,603 — 1,177 822 Derivatives not designated under hedge accounting Forward contracts - buy Euro (1) 6/2023 € 160 5 — — — Subtotal 5 — — — Total fair value $ 3,608 $ — $ 1,177 $ 822 (in thousands) February 28, 2023 Derivatives designated as hedging instruments Hedge Type Final Notional Amount Prepaid Other Assets Accrued Other Forward contracts - sell Euro Cash flow 2/2024 € 29,310 $ 257 $ — $ — $ — Forward contracts - sell Canadian Dollars Cash flow 2/2024 $ 30,000 962 11 — — Forward contracts - sell Pounds Cash flow 1/2024 £ 19,400 — — 711 — Forward contracts - sell Norwegian Kroner Cash flow 2/2024 kr 40,000 185 — — — Interest rate swaps Cash flow 2/2026 $ 425,000 3,941 1,805 — — Subtotal 5,345 1,816 711 — Derivatives not designated under hedge accounting Forward contracts - buy Euro (1) 3/2023 € 500 6 — — — Forward contracts - buy Pounds (1) 3/2023 £ 400 2 — — — Subtotal 8 — — — Total fair value $ 5,353 $ 1,816 $ 711 $ — (1) These forward contracts, for which we have not elected hedge accounting, hedge monetary net asset and liability positions for the notional amounts reported, creating an economic hedge against currency movements. The pre-tax effects of derivative instruments designated as cash flow hedges were as follows for the periods presented: Three Months Ended May 31, Gain (Loss) Gain (Loss) Reclassified (in thousands) 2023 2022 Location 2023 2022 Foreign currency contracts - cash flow hedges $ (467) $ 2,319 Sales revenue, net $ 338 $ 1,196 Interest rate swaps - cash flow hedges (2,634) 2,206 Interest expense 1,407 (680) Total $ (3,101) $ 4,525 $ 1,745 $ 516 The pre-tax effects of derivative instruments not designated under hedge accounting were as follows for the periods presented: Gain (Loss) Three Months Ended May 31, (in thousands) Location 2023 2022 Forward contracts SG&A $ (24) $ — Cross-currency debt swaps - principal SG&A — 875 Total $ (24) $ 875 We expect a net gain of $2.4 million associated with foreign currency contracts and interest rate swaps currently recorded in AOCI to be reclassified into income over the next twelve months. The amount ultimately realized, however, will differ as exchange rates and interest rates change and the underlying contracts settle. See Notes 10 and 12 to these condensed consolidated financial statements for more information. Counterparty Credit Risk Financial instruments, including foreign currency contracts, forward contracts, cross-currency debt swaps and interest rate swaps, expose us to counterparty credit risk for non-performance. We manage our exposure to counterparty credit risk by only dealing with counterparties who are substantial international financial institutions with significant experience using such derivative instruments. We believe that the risk of incurring credit losses is remote. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 3 Months Ended |
May 31, 2023 | |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | Note 12 - Accumulated Other Comprehensive Income (Loss) The changes in AOCI by component and related tax effects for the periods presented were as follows: (in thousands) Interest Foreign Total Balance at February 28, 2022 $ (2,126) $ 2,328 $ 202 Other comprehensive income before reclassification 2,206 2,319 4,525 Amounts reclassified out of AOCI 680 (1,196) (516) Tax effects (680) (170) (850) Other comprehensive income 2,206 953 3,159 Balance at May 31, 2022 $ 80 $ 3,281 $ 3,361 Balance at February 28, 2023 $ 4,394 $ 553 $ 4,947 Other comprehensive loss before reclassification (2,634) (467) (3,101) Amounts reclassified out of AOCI (1,407) (338) (1,745) Tax effects 949 182 1,131 Other comprehensive loss (3,092) (623) (3,715) Balance at May 31, 2023 $ 1,302 $ (70) $ 1,232 See Notes 9, 10 and 11 to these condensed consolidated financial statements for additional information regarding our cash flow hedges. |
Segment Information
Segment Information | 3 Months Ended |
May 31, 2023 | |
Segment Reporting [Abstract] | |
Segment Information | Note 13 - Segment Information We currently operate two reportable segments consisting of Home & Outdoor and Beauty & Wellness. During the fourth quarter of fiscal 2023, we made changes to the structure of our organization in connection with our global restructuring plan that resulted in our previous Health & Wellness and Beauty operating segments being combined into a single reportable segment, which is referred to herein as “Beauty & Wellness.” Comparative prior period segment information in this report has been recast to conform to this change in our reportable segments. See Note 1 to these condensed consolidated financial statements for additional information. The following tables summarize segment information for the periods presented: Three Months Ended May 31, 2023 (in thousands) Home & Outdoor Beauty & Wellness Total Sales revenue, net $ 217,144 $ 257,528 $ 474,672 Restructuring charges 2,790 4,565 7,355 Operating income 22,116 18,525 40,641 Capital and intangible asset expenditures 10,960 917 11,877 Depreciation and amortization 4,402 6,313 10,715 Three Months Ended May 31, 2022 (in thousands) Home & Outdoor Beauty & Wellness Total Sales revenue, net $ 234,263 $ 273,815 $ 508,078 Restructuring charges — 2 2 Operating income 29,793 4,146 33,939 Capital and intangible asset expenditures 72,731 3,471 76,202 Depreciation and amortization 4,495 6,003 10,498 The following table presents net sales revenue by geographic region, in U.S. Dollars: Three Months Ended May 31, (in thousands) 2023 2022 Domestic sales revenue, net (1) $ 359,559 75.7 % $ 396,746 78.1 % International sales revenue, net 115,113 24.3 % 111,332 21.9 % Total sales revenue, net $ 474,672 100.0 % $ 508,078 100.0 % (1) Beginning in the fourth quarter of fiscal 2023, we included net sales revenue from the U.S. and Canada as domestic net sales revenue. Previously, we reported sales revenue from Canada within international net sales revenue. We have recast the prior period domestic and international net sales revenue presented to conform with this current presentation. |
Income Taxes
Income Taxes | 3 Months Ended |
May 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 14 - Income Taxes We reorganized the Company in Bermuda in 1994 and many of our foreign subsidiaries are not directly or indirectly owned by a U.S. parent. As such, a large portion of our foreign income is not subject to U.S. taxation on a permanent basis under current law. Additionally, our intellectual property is largely owned by foreign subsidiaries, resulting in proportionally higher earnings in jurisdictions with lower statutory tax rates, which decreases our overall effective tax rate. The taxable income earned in each jurisdiction, whether U.S. or foreign, is determined by the subsidiary's operating results and transfer pricing and tax regulations in the related jurisdictions. For interim periods, our income tax expense and resulting effective tax rate are based upon an estimated annual effective tax rate adjusted for the effects of items required to be treated as discrete to the period, including changes in tax laws, changes in estimated exposures for uncertain tax positions and other items. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
May 31, 2023 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 15 - Earnings Per Share We compute basic earnings per share using the weighted average number of shares of common stock outstanding during the period. We compute diluted earnings per share using the weighted average number of shares of common stock outstanding plus the effect of dilutive securities. Dilutive securities at any given point in time may consist of outstanding options to purchase common stock and issued and contingently issuable unvested restricted stock units, performance stock units, restricted stock awards and performance restricted stock awards and other stock-based awards. Anti-dilutive securities are not included in the computation of diluted earnings per share under the treasury stock method. See Note 5 to these condensed consolidated financial statements for more information regarding stock-based awards. The following table presents our weighted average basic and diluted shares outstanding for the periods shown: Three Months Ended May 31, (in thousands) 2023 2022 Weighted average shares outstanding, basic 24,049 23,865 Incremental shares from share-based compensation arrangements 85 257 Weighted average shares outstanding, diluted 24,134 24,122 Anti-dilutive securities 156 29 |
Basis of Presentation and Rel_2
Basis of Presentation and Related Information (Policies) | 3 Months Ended |
May 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Principles of Consolidation | Principles of Consolidation The accompanying condensed consolidated financial statements are prepared in accordance with GAAP and include all of our subsidiaries. Our condensed consolidated financial statements are prepared in U.S. Dollars. All intercompany balances and transactions are eliminated in consolidation. The preparation of consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in our condensed consolidated financial statements and accompanying notes. Actual results may differ materially from those estimates. |
Not Yet Adopted | Adopted In September 2022, the FASB issued ASU 2022-04, Liabilities—Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations , which requires a buyer in a supplier finance program to disclose qualitative and quantitative information about its program to allow a user of the financial statements to understand the program’s nature, activity during the period, changes from period to period, and potential magnitude. The amendments in ASU 2022-04 are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022, with the exception for the amendment on rollforward information, which is effective for fiscal years beginning after December 15, 2023. The guidance should be applied retrospectively, except for the amendment on rollforward information, which should be applied prospectively. This ASU was effective for us in the first quarter of fiscal 2024, with the exception of the amendment on rollforward information, which will be effective for us in our Form 10-K for fiscal 2025. We adopted this ASU during the first quarter of fiscal 2024 and the adoption did not have an impact on our consolidated financial statement disclosures. In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers , which requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASC 606, Revenue from Contracts with Customers . Prior to the issuance of this guidance, contract assets and contract liabilities were recognized by the acquirer at fair value on the acquisition date. The amendments in ASU 2021-08 are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022, and should be applied prospectively to acquisitions occurring on or after the effective date. We adopted this ASU during the first quarter of fiscal 2024 and the adoption did not have an impact on our consolidated financial statements. |
Reclassifications | Reclassifications We have reclassified or combined certain amounts in the prior year's accompanying footnotes to conform with the current year's presentation. |
Acquisition of Curlsmith (Table
Acquisition of Curlsmith (Tables) | 3 Months Ended |
May 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of business acquisitions, by acquisition | The following table presents the estimated fair values of assets acquired and liabilities assumed at the acquisition date: (in thousands) Assets: Receivables $ 4,211 Inventory 7,890 Prepaid expenses and other current assets 119 Property and equipment 212 Goodwill 117,108 Trade names - definite 21,000 Customer relationships - definite 12,000 Deferred tax assets, net 360 Total assets 162,900 Liabilities: Accounts payable 1,401 Accrued expenses and other current liabilities 2,813 Income taxes payable 2,572 Deferred tax liabilities, net 8,187 Total liabilities 14,973 Net assets recorded $ 147,927 |
Business acquisition, pro forma information | The impact of the acquisition of Curlsmith on our condensed consolidated statements of income for the first quarter of fiscal 2023 was as follows: April 22, 2022 (acquisition date) through May 31, 2022 (in thousands, except earnings per share data) Three Months Ended May 31, 2022 (1) Sales revenue, net $ 3,246 Net income 439 EPS: Basic $ 0.02 Diluted $ 0.02 (1) Represents approximately six weeks of operating results from Curlsmith, acquired April 22, 2022. Net income and EPS amounts include allocations for corporate expenses, interest expense and income tax expense. The following supplemental unaudited pro forma information presents our financial results as if the acquisition of Curlsmith had occurred on March 1, 2021. This supplemental pro forma information has been prepared for comparative purposes and does not necessarily indicate what may have occurred if the acquisition had been completed on March 1, 2021, and this information is not intended to be indicative of future results. (in thousands, except earnings per share data) Three Months Ended May 31, 2022 Sales revenue, net $ 515,170 Net income 26,508 EPS: Basic $ 1.11 Diluted $ 1.10 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 3 Months Ended |
May 31, 2023 | |
Payables and Accruals [Abstract] | |
Schedule of accrued expenses and other current liabilities | A summary of accrued expenses and other current liabilities was as follows: (in thousands) May 31, 2023 February 28, 2023 Accrued compensation, benefits and payroll taxes $ 23,525 $ 17,380 Accrued sales discounts and allowances 52,473 63,881 Accrued sales returns 29,880 28,498 Accrued advertising 32,204 36,931 Other 54,967 54,028 Total accrued expenses and other current liabilities $ 193,049 $ 200,718 |
Share-Based Compensation Plans
Share-Based Compensation Plans (Tables) | 3 Months Ended |
May 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Share-based compensation expense in SG&A | We recorded share-based compensation expense in SG&A as follows: Three Months Ended May 31, (in thousands) 2023 2022 Directors stock compensation $ 197 $ 173 Service Condition Awards 3,320 3,117 Performance Condition Awards 2,023 10,845 Market Condition Awards 3,147 1,910 Employee stock purchase plan 610 574 Share-based compensation expense 9,297 16,619 Less income tax benefits (641) (1,084) Share-based compensation expense, net of income tax benefits $ 8,656 $ 15,535 |
Repurchases of Common Stock (Ta
Repurchases of Common Stock (Tables) | 3 Months Ended |
May 31, 2023 | |
Equity [Abstract] | |
Summary of share repurchase activity | The following table summarizes our share repurchase activity for the periods shown: Three Months Ended May 31, (in thousands, except share and per share data) 2023 2022 Common stock repurchased on the open market: Number of shares — — Aggregate value of shares $ — $ — Average price per share $ — $ — Common stock received in connection with share-based compensation: Number of shares 44,632 89,458 Aggregate value of shares $ 4,446 $ 18,224 Average price per share $ 99.61 $ 203.71 |
Restructuring Plan (Tables)
Restructuring Plan (Tables) | 3 Months Ended |
May 31, 2023 | |
Restructuring and Related Activities [Abstract] | |
Summary of restructuring charges recorded | The following table summarizes restructuring charges recorded as a result of Project Pegasus for the periods presented: Three Months Ended May 31, 2023 Total (in thousands) Home & Beauty & Wellness Total Severance and employee related costs $ 484 $ 408 $ 892 $ 10,345 Professional fees 2,269 3,357 5,626 22,375 Contract termination — 688 688 1,223 Other 37 112 149 774 Total restructuring charges $ 2,790 $ 4,565 $ 7,355 $ 34,717 |
Rollforward of restructuring reserve | The table below presents a rollforward of our accruals related to Project Pegasus, which are included in accounts payable and accrued expenses and other current liabilities: (in thousands) Balance at February 28, 2023 Charges Payments Balance at May 31, 2023 Severance and employee related costs $ 3,173 $ 892 $ (2,316) $ 1,749 Professional fees 3,201 5,626 (6,026) 2,801 Contract termination 160 688 (848) — Other 34 149 (183) — Total $ 6,568 $ 7,355 $ (9,373) $ 4,550 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
May 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of production related impairments | We refer to these charges as “EPA compliance costs.” The following table provides a summary of EPA compliance costs incurred during the periods presented: Three Months Ended May 31, (in thousands) 2023 2022 Cost of goods sold $ — $ 9,455 1 SG&A — 2,189 Total EPA compliance costs $ — $ 11,644 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
May 31, 2023 | |
Debt Disclosure [Abstract] | |
Summary of long-term debt | A summary of our long-term debt follows: (in thousands) May 31, 2023 February 28, 2023 Credit Agreement (1): Revolving loans 594,000 690,000 Term loans 245,312 246,875 Total borrowings under Credit Agreement 839,312 936,875 Unamortized prepaid financing fees (2,155) (2,463) Total long-term debt 837,157 934,412 Less: current maturities of long-term debt (6,235) (6,064) Long-term debt, excluding current maturities $ 830,922 $ 928,348 (1) The weighted average interest rates on borrowings outstanding under the Credit Agreement (defined below) as of May 31, 2023 and February 28, 2023 were 6.8% and 6.6%, respectively. |
Fair Value (Tables)
Fair Value (Tables) | 3 Months Ended |
May 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of carrying value and fair value of financial assets and liabilities recorded at fair value and measured on a recurring basis and classified as level 2 | The following table presents the carrying amount and fair value of our financial assets and liabilities measured and recorded at fair value on a recurring basis and classified as Level 2: Carrying Amount and Fair Value (in thousands) May 31, 2023 February 28, 2023 Assets: Cash equivalents (money market accounts) $ 10,745 $ 381 Interest rate swaps 2,527 5,746 Foreign currency derivatives 1,081 1,423 Total assets $ 14,353 $ 7,550 Liabilities: Interest rate swaps $ 822 $ — Foreign currency derivatives 1,177 711 Total liabilities $ 1,999 $ 711 |
Financial Instruments and Ris_2
Financial Instruments and Risk Management (Tables) | 3 Months Ended |
May 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of fair values of derivative instruments | The following tables summarize the fair values of our derivative instruments as of the end of the periods presented: (in thousands) May 31, 2023 Derivatives designated as hedging instruments Hedge Final Notional Amount Prepaid Other Assets Accrued Other Forward contracts - sell Euro Cash flow 2/2024 € 27,350 $ 58 $ — $ 27 $ — Forward contracts - sell Canadian Dollars Cash flow 2/2024 $ 25,500 730 — — — Forward contracts - sell Pounds Cash flow 2/2024 £ 23,525 — — 1,150 — Forward contracts - sell Norwegian Kroner Cash flow 10/2023 kr 30,000 288 — — — Interest rate swaps Cash flow 2/2026 $ 625,000 2,527 — — 822 Subtotal 3,603 — 1,177 822 Derivatives not designated under hedge accounting Forward contracts - buy Euro (1) 6/2023 € 160 5 — — — Subtotal 5 — — — Total fair value $ 3,608 $ — $ 1,177 $ 822 (in thousands) February 28, 2023 Derivatives designated as hedging instruments Hedge Type Final Notional Amount Prepaid Other Assets Accrued Other Forward contracts - sell Euro Cash flow 2/2024 € 29,310 $ 257 $ — $ — $ — Forward contracts - sell Canadian Dollars Cash flow 2/2024 $ 30,000 962 11 — — Forward contracts - sell Pounds Cash flow 1/2024 £ 19,400 — — 711 — Forward contracts - sell Norwegian Kroner Cash flow 2/2024 kr 40,000 185 — — — Interest rate swaps Cash flow 2/2026 $ 425,000 3,941 1,805 — — Subtotal 5,345 1,816 711 — Derivatives not designated under hedge accounting Forward contracts - buy Euro (1) 3/2023 € 500 6 — — — Forward contracts - buy Pounds (1) 3/2023 £ 400 2 — — — Subtotal 8 — — — Total fair value $ 5,353 $ 1,816 $ 711 $ — |
Schedule of pre-tax effect of derivative instruments designated as hedges | The pre-tax effects of derivative instruments designated as cash flow hedges were as follows for the periods presented: Three Months Ended May 31, Gain (Loss) Gain (Loss) Reclassified (in thousands) 2023 2022 Location 2023 2022 Foreign currency contracts - cash flow hedges $ (467) $ 2,319 Sales revenue, net $ 338 $ 1,196 Interest rate swaps - cash flow hedges (2,634) 2,206 Interest expense 1,407 (680) Total $ (3,101) $ 4,525 $ 1,745 $ 516 |
Schedule of pre-tax effect of derivative instruments not designated as hedges | The pre-tax effects of derivative instruments not designated under hedge accounting were as follows for the periods presented: Gain (Loss) Three Months Ended May 31, (in thousands) Location 2023 2022 Forward contracts SG&A $ (24) $ — Cross-currency debt swaps - principal SG&A — 875 Total $ (24) $ 875 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
May 31, 2023 | |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent [Abstract] | |
Summary of changes in accumulated other comprehensive income (loss) | The changes in AOCI by component and related tax effects for the periods presented were as follows: (in thousands) Interest Foreign Total Balance at February 28, 2022 $ (2,126) $ 2,328 $ 202 Other comprehensive income before reclassification 2,206 2,319 4,525 Amounts reclassified out of AOCI 680 (1,196) (516) Tax effects (680) (170) (850) Other comprehensive income 2,206 953 3,159 Balance at May 31, 2022 $ 80 $ 3,281 $ 3,361 Balance at February 28, 2023 $ 4,394 $ 553 $ 4,947 Other comprehensive loss before reclassification (2,634) (467) (3,101) Amounts reclassified out of AOCI (1,407) (338) (1,745) Tax effects 949 182 1,131 Other comprehensive loss (3,092) (623) (3,715) Balance at May 31, 2023 $ 1,302 $ (70) $ 1,232 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
May 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of segment information | The following tables summarize segment information for the periods presented: Three Months Ended May 31, 2023 (in thousands) Home & Outdoor Beauty & Wellness Total Sales revenue, net $ 217,144 $ 257,528 $ 474,672 Restructuring charges 2,790 4,565 7,355 Operating income 22,116 18,525 40,641 Capital and intangible asset expenditures 10,960 917 11,877 Depreciation and amortization 4,402 6,313 10,715 Three Months Ended May 31, 2022 (in thousands) Home & Outdoor Beauty & Wellness Total Sales revenue, net $ 234,263 $ 273,815 $ 508,078 Restructuring charges — 2 2 Operating income 29,793 4,146 33,939 Capital and intangible asset expenditures 72,731 3,471 76,202 Depreciation and amortization 4,495 6,003 10,498 The following table presents net sales revenue by geographic region, in U.S. Dollars: Three Months Ended May 31, (in thousands) 2023 2022 Domestic sales revenue, net (1) $ 359,559 75.7 % $ 396,746 78.1 % International sales revenue, net 115,113 24.3 % 111,332 21.9 % Total sales revenue, net $ 474,672 100.0 % $ 508,078 100.0 % (1) Beginning in the fourth quarter of fiscal 2023, we included net sales revenue from the U.S. and Canada as domestic net sales revenue. Previously, we reported sales revenue from Canada within international net sales revenue. We have recast the prior period domestic and international net sales revenue presented to conform with this current presentation. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
May 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of components of basic and diluted shares | The following table presents our weighted average basic and diluted shares outstanding for the periods shown: Three Months Ended May 31, (in thousands) 2023 2022 Weighted average shares outstanding, basic 24,049 23,865 Incremental shares from share-based compensation arrangements 85 257 Weighted average shares outstanding, diluted 24,134 24,122 Anti-dilutive securities 156 29 |
Basis of Presentation and Rel_3
Basis of Presentation and Related Information (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||
Apr. 22, 2022 USD ($) | Mar. 25, 2022 USD ($) | Jun. 07, 2021 USD ($) | May 31, 2023 USD ($) segment $ / shares | Feb. 28, 2023 USD ($) $ / shares | May 31, 2022 USD ($) | Feb. 28, 2023 USD ($) $ / shares | |
Discontinued Operations | |||||||
Common shares, par value (in dollars per share) | $ / shares | $ 0.10 | $ 0.10 | $ 0.10 | ||||
Number of segments | segment | 2 | ||||||
Net payments to acquire businesses, net of cash acquired | $ 0 | $ 148,111 | |||||
Proceeds from sale of personal care business | $ 44,700 | 0 | 1,804 | ||||
Gain on sale of North America Personal Care business | $ 500 | 0 | $ 1,336 | ||||
Insurance settlements receivable | 46,000 | ||||||
Latin America and Caribbean Personal Care Business | |||||||
Discontinued Operations | |||||||
Proceeds from sale of personal care business | $ 1,800 | ||||||
Gain on sale of North America Personal Care business | $ 1,300 | ||||||
Curlsmith | |||||||
Discontinued Operations | |||||||
Net payments to acquire businesses, net of cash acquired | $ 147,900 | ||||||
Adjustments to goodwill | $ 300 | $ (1,800) | $ 100 |
Acquisition of Curlsmith - Narr
Acquisition of Curlsmith - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Apr. 22, 2022 | May 31, 2023 | Feb. 28, 2023 | May 31, 2022 | Feb. 28, 2023 | |
Business Acquisition [Line Items] | |||||
Net payments to acquire businesses | $ 0 | $ 148,111 | |||
Curlsmith | |||||
Business Acquisition [Line Items] | |||||
Net payments to acquire businesses | $ 147,900 | ||||
Net working capital adjustment | 2,100 | ||||
Acquisition related expenses | $ 2,700 | ||||
Adjustments to goodwill | $ 300 | $ (1,800) | $ 100 | ||
Reduction to total purchase consideration | $ 1,800 | ||||
Receivables | 4,211 | ||||
Curlsmith | Trade Names | |||||
Business Acquisition [Line Items] | |||||
Up-front license fee | $ 21,000 | ||||
Expected life | 20 years | ||||
Curlsmith | Customer Relationships | |||||
Business Acquisition [Line Items] | |||||
Up-front license fee | $ 12,000 | ||||
Expected life | 19 years 6 months |
Acquisition of Curlsmith - Busi
Acquisition of Curlsmith - Business Acquisitions, by Acquisition (Details) - USD ($) $ in Thousands | May 31, 2023 | Feb. 28, 2023 | Apr. 22, 2022 |
Assets | |||
Goodwill | $ 1,066,730 | $ 1,066,479 | |
Liabilities: | |||
Income taxes payable | $ 2,572 | ||
Curlsmith | |||
Assets | |||
Receivables | 4,211 | ||
Inventory | 7,890 | ||
Prepaid expenses and other current assets | 119 | ||
Property and equipment | 212 | ||
Goodwill | 117,108 | ||
Deferred tax assets, net | 360 | ||
Total assets | 162,900 | ||
Liabilities: | |||
Accounts payable | 1,401 | ||
Accrued expenses and other current liabilities | 2,813 | ||
Deferred tax liabilities, net | 8,187 | ||
Total liabilities | 14,973 | ||
Net assets recorded | 147,927 | ||
Curlsmith | Trade Names | |||
Assets | |||
Trade names and customer relationships - definite | 21,000 | ||
Curlsmith | Customer Relationships | |||
Assets | |||
Trade names and customer relationships - definite | $ 12,000 |
Acquisition of Curlsmith - Impa
Acquisition of Curlsmith - Impact of the Acquisition of Curlsmith on Income (Details) - Curlsmith $ / shares in Units, $ in Thousands | 3 Months Ended |
May 31, 2022 USD ($) $ / shares | |
Business Acquisition [Line Items] | |
Sales revenue, net | $ | $ 3,246 |
Net income | $ | $ 439 |
EPS: | |
Basic (in dollars per share) | $ / shares | $ 0.02 |
Diluted (in dollars per share) | $ / shares | $ 0.02 |
Acquisition of Curlsmith - Pro
Acquisition of Curlsmith - Pro Forma Information (Details) - Curlsmith $ / shares in Units, $ in Thousands | 3 Months Ended |
May 31, 2022 USD ($) $ / shares | |
Business Acquisition [Line Items] | |
Sales revenue, net | $ | $ 515,170 |
Net income | $ | $ 26,508 |
EPS: | |
Basic (in dollars per share) | $ / shares | $ 1.11 |
Diluted (in dollars per share) | $ / shares | $ 1.10 |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | May 31, 2023 | Feb. 28, 2023 |
Payables and Accruals [Abstract] | ||
Accrued compensation, benefits and payroll taxes | $ 23,525 | $ 17,380 |
Accrued sales discounts and allowances | 52,473 | 63,881 |
Accrued sales returns | 29,880 | 28,498 |
Accrued advertising | 32,204 | 36,931 |
Other | 54,967 | 54,028 |
Accrued expenses and other current liabilities | $ 193,049 | $ 200,718 |
Share-Based Compensation Plan_2
Share-Based Compensation Plans - Narrative (Details) $ / shares in Units, $ in Millions | 3 Months Ended |
May 31, 2023 USD ($) $ / shares shares | |
Share-based compensation plans | |
Expected recognition period for unrecognized share-based compensation | 2 years 1 month 6 days |
Target achievement for performance condition awards, as a percentage | 0% |
Restricted Stock | |
Share-based compensation plans | |
Number of awards granted (in shares) | 252,522 |
Unrecognized share-based compensation | $ | $ 41.4 |
Service Condition Awards | |
Share-based compensation plans | |
Number of awards granted (in shares) | 94,807 |
Grant date fair value of shares granted in period (in dollars per share) | $ / shares | $ 110.85 |
Market Condition Awards | |
Share-based compensation plans | |
Number of awards granted (in shares) | 126,204 |
Grant date fair value of shares granted in period (in dollars per share) | $ / shares | $ 80.50 |
Performance Condition Awards | |
Share-based compensation plans | |
Number of awards granted (in shares) | 126,318 |
Grant date fair value of shares granted in period (in dollars per share) | $ / shares | $ 110.85 |
Share-Based Compensation Plan_3
Share-Based Compensation Plans - Share-Based Compensation Expense in SG&A (Details) - USD ($) $ in Thousands | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense, net of income tax benefits | $ 8,656 | $ 15,535 |
SG&A | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | 9,297 | 16,619 |
Less income tax benefits | (641) | (1,084) |
Service Condition Awards | SG&A | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | 3,320 | 3,117 |
Performance Condition Awards | SG&A | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | 2,023 | 10,845 |
Market Condition Awards | SG&A | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | 3,147 | 1,910 |
Employee stock purchase plan | SG&A | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | 610 | 574 |
Directors stock compensation | SG&A | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | $ 197 | $ 173 |
Repurchases of Common Stock - N
Repurchases of Common Stock - Narrative (Details) - USD ($) | Aug. 25, 2021 | May 31, 2023 | Aug. 31, 2021 |
Equity [Abstract] | |||
Amount of shares authorized for purchase | $ 500,000,000 | ||
Period for stock repurchase | 3 years | ||
Remaining share repurchase amount | $ 399,200,000 |
Repurchases of Common Stock - S
Repurchases of Common Stock - Summary of Share Repurchase Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Repurchase of common stock | ||
Aggregate value of shares | $ 4,446 | $ 18,224 |
Stock Compensation Plan | ||
Repurchase of common stock | ||
Number of shares (in shares) | 44,632 | 89,458 |
Aggregate value of shares | $ 4,446 | $ 18,224 |
Average price per share (in dollars per share) | $ 99.61 | $ 203.71 |
Open Market | ||
Repurchase of common stock | ||
Number of shares (in shares) | 0 | 0 |
Aggregate value of shares | $ 0 | $ 0 |
Average price per share (in dollars per share) | $ 0 | $ 0 |
Restructuring Plan - Narrative
Restructuring Plan - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
May 31, 2023 | May 31, 2022 | May 31, 2023 | |
Restructuring Plan | |||
Restructuring charges | $ 7,355 | $ 2 | |
Project Pegasus | |||
Restructuring Plan | |||
Estimated percentage of workforce reduction | 10% | 10% | |
Estimated percentage reduction in cost of goods sold | 60% | ||
Estimated percentage reduction in SG&A expenses | 40% | ||
Restructuring charges | $ 7,355 | $ 34,717 | |
Project Pegasus | Fiscal 2024 | |||
Restructuring Plan | |||
Estimated percentage of savings recognized | 25% | ||
Project Pegasus | Fiscal 2025 | |||
Restructuring Plan | |||
Estimated percentage of savings recognized | 50% | ||
Project Pegasus | Fiscal 2026 | |||
Restructuring Plan | |||
Estimated percentage of savings recognized | 25% | ||
Project Pegasus | Minimum | |||
Restructuring Plan | |||
Annualized profit improvements | $ 75,000 | ||
Expected restructuring costs | 85,000 | 85,000 | |
Project Pegasus | Maximum | |||
Restructuring Plan | |||
Annualized profit improvements | 85,000 | ||
Expected restructuring costs | $ 95,000 | $ 95,000 |
Restructuring Plan - Restructur
Restructuring Plan - Restructuring Charges to Date (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
May 31, 2023 | May 31, 2022 | May 31, 2023 | |
Restructuring Plan | |||
Total restructuring charges | $ 7,355 | $ 2 | |
Project Pegasus | |||
Restructuring Plan | |||
Severance and employee related costs | 892 | $ 10,345 | |
Professional fees | 5,626 | 22,375 | |
Contract termination | 688 | 1,223 | |
Other | 149 | 774 | |
Total restructuring charges | 7,355 | $ 34,717 | |
Home & Outdoor | Project Pegasus | |||
Restructuring Plan | |||
Severance and employee related costs | 484 | ||
Professional fees | 2,269 | ||
Contract termination | 0 | ||
Other | 37 | ||
Total restructuring charges | 2,790 | ||
Beauty & Wellness | |||
Restructuring Plan | |||
Total restructuring charges | 4,565 | $ 2 | |
Beauty & Wellness | Project Pegasus | |||
Restructuring Plan | |||
Severance and employee related costs | 408 | ||
Professional fees | 3,357 | ||
Contract termination | 688 | ||
Other | 112 | ||
Total restructuring charges | $ 4,565 |
Restructuring Plan - Reserve Ro
Restructuring Plan - Reserve Roll Forward (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
May 31, 2023 | May 31, 2022 | May 31, 2023 | |
Restructuring Reserve [Roll Forward] | |||
Charges | $ 7,355 | $ 2 | |
Project Pegasus | |||
Restructuring Reserve [Roll Forward] | |||
Restructuring liability, beginning balance | 6,568 | ||
Charges | 7,355 | $ 34,717 | |
Payments | (9,373) | ||
Restructuring liability, ending balance | 4,550 | 4,550 | |
Severance and employee related costs | Project Pegasus | |||
Restructuring Reserve [Roll Forward] | |||
Restructuring liability, beginning balance | 3,173 | ||
Charges | 892 | ||
Payments | (2,316) | ||
Restructuring liability, ending balance | 1,749 | 1,749 | |
Professional fees | Project Pegasus | |||
Restructuring Reserve [Roll Forward] | |||
Restructuring liability, beginning balance | 3,201 | ||
Charges | 5,626 | ||
Payments | (6,026) | ||
Restructuring liability, ending balance | 2,801 | 2,801 | |
Contract termination | Project Pegasus | |||
Restructuring Reserve [Roll Forward] | |||
Restructuring liability, beginning balance | 160 | ||
Charges | 688 | ||
Payments | (848) | ||
Restructuring liability, ending balance | 0 | 0 | |
Other | Project Pegasus | |||
Restructuring Reserve [Roll Forward] | |||
Restructuring liability, beginning balance | 34 | ||
Charges | 149 | ||
Payments | (183) | ||
Restructuring liability, ending balance | $ 0 | $ 0 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) $ in Thousands | 3 Months Ended | |||
May 31, 2023 USD ($) | Feb. 28, 2023 USD ($) | May 31, 2022 USD ($) | Dec. 23, 2021 renewal | |
Commitments and contingencies | ||||
Number of other companies named in litigation | renewal | 5 | |||
Insurance settlements receivable | $ 46,000 | |||
Gain from insurance recoveries | $ 9,700 | |||
Weather-Related Incident | ||||
Commitments and contingencies | ||||
Weather related inventory write-down | $ 34,400 | |||
Probable insurance recoveries | 34,400 | |||
Health & Wellness [Member] | ||||
Commitments and contingencies | ||||
Charge to write off obsolete packaging | 0 | 11,644 | ||
Health & Wellness [Member] | Cost of Sales | ||||
Commitments and contingencies | ||||
Charge to write off obsolete packaging | 0 | 9,455 | ||
Health & Wellness [Member] | Cost of Sales | Obsolete Packaging | ||||
Commitments and contingencies | ||||
Charge to write off obsolete packaging | 4,400 | |||
Health & Wellness [Member] | SG&A | ||||
Commitments and contingencies | ||||
Charge to write off obsolete packaging | $ 0 | $ 2,189 |
Long-Term Debt - Schedule (Deta
Long-Term Debt - Schedule (Details) - USD ($) $ in Thousands | May 31, 2023 | Feb. 28, 2023 |
Long-term debt | ||
Unamortized prepaid financing fees | $ (2,155) | $ (2,463) |
Total long-term debt | 837,157 | 934,412 |
Less: current maturities of long-term debt | (6,235) | (6,064) |
Long-term debt, excluding current maturities | $ 830,922 | $ 928,348 |
Line of credit | ||
Long-term debt | ||
Weighted average effective interest rate | 6.80% | 6.60% |
Line of credit | Credit Agreement | ||
Long-term debt | ||
Aggregate principal balance | $ 839,312 | $ 936,875 |
Line of credit | Credit Agreement | Revolving loans | ||
Long-term debt | ||
Aggregate principal balance | 594,000 | 690,000 |
Line of credit | Credit Agreement | Term loans | ||
Long-term debt | ||
Aggregate principal balance | $ 245,312 | $ 246,875 |
Long-Term Debt - Narrative (Det
Long-Term Debt - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Feb. 28, 2022 | May 31, 2023 | May 31, 2022 | Feb. 28, 2023 | Jun. 28, 2022 | |
Debt Instrument [Line Items] | |||||
Interest costs incurred | $ 14,900 | $ 5,100 | |||
Interest costs capitalized | 900 | $ 700 | |||
Revolving loans | |||||
Debt Instrument [Line Items] | |||||
Maximum revolving commitment | 1,250,000 | ||||
Line of credit | |||||
Debt Instrument [Line Items] | |||||
Maximum additional debt allowed in the event a qualified acquisition is consummated | 343,000 | ||||
Fixed rate debt | 625,000 | $ 425,000 | |||
Line of credit | Minimum | Base rate | |||||
Debt Instrument [Line Items] | |||||
Margin (as a percent) | 0% | ||||
Line of credit | Minimum | SOFR | |||||
Debt Instrument [Line Items] | |||||
Margin (as a percent) | 1% | ||||
Line of credit | Maximum | Base rate | |||||
Debt Instrument [Line Items] | |||||
Margin (as a percent) | 1% | ||||
Line of credit | Maximum | SOFR | |||||
Debt Instrument [Line Items] | |||||
Margin (as a percent) | 2% | ||||
Line of credit | Credit Agreement | SOFR | |||||
Debt Instrument [Line Items] | |||||
Additional credit spread | 0.10% | ||||
Line of credit | Letter of credit | |||||
Debt Instrument [Line Items] | |||||
Amount outstanding, letters of credit | 18,200 | ||||
Line of credit | Revolving loans | Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Maximum allowable increase due to accordion feature | 300,000 | ||||
Proceeds from exercise of accordion feature | 250,000 | ||||
Percent of term loans due quarterly | 0.625% | ||||
Amount available for borrowings | $ 637,800 | ||||
Fixed rate debt | $ 425,000 |
Fair Value (Details)
Fair Value (Details) - Recurring - Fair Values - Fair Value, Inputs, Level 2 - USD ($) $ in Thousands | May 31, 2023 | Feb. 28, 2023 |
Assets: | ||
Total assets | $ 14,353 | $ 7,550 |
Liabilities: | ||
Total liabilities | 1,999 | 711 |
Interest rate swaps | ||
Assets: | ||
Foreign currency derivatives | 2,527 | 5,746 |
Liabilities: | ||
Derivative liabilities | 822 | 0 |
Foreign currency derivatives | ||
Assets: | ||
Foreign currency derivatives | 1,081 | 1,423 |
Liabilities: | ||
Derivative liabilities | 1,177 | 711 |
Money market funds | ||
Assets: | ||
Cash equivalents (money market accounts) | $ 10,745 | $ 381 |
Financial Instruments and Ris_3
Financial Instruments and Risk Management - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
May 31, 2023 | May 31, 2022 | Feb. 28, 2023 | |
Foreign currency derivatives | Cash flow hedges | |||
Foreign Currency Risk and Currency Exchange Uncertainties | |||
Net gain reported in AOCI to be reclassified | $ (2,400) | ||
Period of reclassification to AOCI | 12 months | ||
Credit agreement | |||
Foreign Currency Risk and Currency Exchange Uncertainties | |||
Fixed rate debt | $ 625,000 | $ 425,000 | |
Credit agreement | Credit Agreement | |||
Foreign Currency Risk and Currency Exchange Uncertainties | |||
Aggregate principal balance | 839,312 | $ 936,875 | |
SG&A | |||
Foreign Currency Risk and Currency Exchange Uncertainties | |||
Net foreign exchange gains (losses), including the impact of currency hedges and currency swaps | $ 400 | $ 200 | |
Net sales revenue | Geographic concentration | International operations - transactions denominated in foreign currencies | |||
Foreign Currency Risk and Currency Exchange Uncertainties | |||
Concentration risk percentage | 15% | 13% |
Financial Instruments and Ris_4
Financial Instruments and Risk Management - Derivative FV (Details) € in Thousands, £ in Thousands, kr in Thousands, $ in Thousands, $ in Thousands | May 31, 2023 EUR (€) | May 31, 2023 USD ($) | May 31, 2023 CAD ($) | May 31, 2023 GBP (£) | May 31, 2023 NOK (kr) | Feb. 28, 2023 EUR (€) | Feb. 28, 2023 USD ($) | Feb. 28, 2023 CAD ($) | Feb. 28, 2023 GBP (£) | Feb. 28, 2023 NOK (kr) |
Prepaid Expenses and Other Current Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | $ 3,608 | $ 5,353 | ||||||||
Other Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 1,816 | ||||||||
Accrued Expenses and Other Current Liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 1,177 | 711 | ||||||||
Other Liabilities, Non- Current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 822 | 0 | ||||||||
Derivatives designated as hedging instruments | Prepaid Expenses and Other Current Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 3,603 | 5,345 | ||||||||
Derivatives designated as hedging instruments | Other Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 1,816 | ||||||||
Derivatives designated as hedging instruments | Accrued Expenses and Other Current Liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 1,177 | 711 | ||||||||
Derivatives designated as hedging instruments | Other Liabilities, Non- Current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 822 | 0 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Euros | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Notional Amount | € | € 27,350 | € 29,310 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Euros | Prepaid Expenses and Other Current Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 58 | 257 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Euros | Other Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Euros | Accrued Expenses and Other Current Liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 27 | 0 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Euros | Other Liabilities, Non- Current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Canadian Dollars | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Notional Amount | $ 25,500 | $ 30,000 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Canadian Dollars | Prepaid Expenses and Other Current Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 730 | 962 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Canadian Dollars | Other Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 11 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Canadian Dollars | Accrued Expenses and Other Current Liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Canadian Dollars | Other Liabilities, Non- Current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Pounds | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Notional Amount | £ | £ 23,525 | £ 19,400 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Pounds | Prepaid Expenses and Other Current Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Pounds | Other Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Pounds | Accrued Expenses and Other Current Liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 1,150 | 711 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Pounds | Other Liabilities, Non- Current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Norwegian Kroner | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Notional Amount | kr | kr 30,000 | kr 40,000 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Norwegian Kroner | Prepaid Expenses and Other Current Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 288 | 185 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Norwegian Kroner | Other Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Norwegian Kroner | Accrued Expenses and Other Current Liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Foreign currency derivatives | Sell | Norwegian Kroner | Other Liabilities, Non- Current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Interest rate swaps | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Notional Amount | 625,000 | 425,000 | ||||||||
Derivatives designated as hedging instruments | Interest rate swaps | Prepaid Expenses and Other Current Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 2,527 | 3,941 | ||||||||
Derivatives designated as hedging instruments | Interest rate swaps | Other Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 1,805 | ||||||||
Derivatives designated as hedging instruments | Interest rate swaps | Accrued Expenses and Other Current Liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Interest rate swaps | Other Liabilities, Non- Current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 822 | 0 | ||||||||
Derivatives not designated under hedge accounting | Prepaid Expenses and Other Current Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 5 | 8 | ||||||||
Derivatives not designated under hedge accounting | Other Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives not designated under hedge accounting | Accrued Expenses and Other Current Liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 0 | 0 | ||||||||
Derivatives not designated under hedge accounting | Other Liabilities, Non- Current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 0 | 0 | ||||||||
Derivatives not designated under hedge accounting | Foreign currency derivatives | Euros | Prepaid Expenses and Other Current Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 6 | |||||||||
Derivatives not designated under hedge accounting | Foreign currency derivatives | Euros | Other Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | |||||||||
Derivatives not designated under hedge accounting | Foreign currency derivatives | Euros | Accrued Expenses and Other Current Liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 0 | |||||||||
Derivatives not designated under hedge accounting | Foreign currency derivatives | Euros | Other Liabilities, Non- Current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 0 | |||||||||
Derivatives not designated under hedge accounting | Foreign currency derivatives | Pounds | Prepaid Expenses and Other Current Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 2 | |||||||||
Derivatives not designated under hedge accounting | Foreign currency derivatives | Pounds | Other Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | |||||||||
Derivatives not designated under hedge accounting | Foreign currency derivatives | Pounds | Accrued Expenses and Other Current Liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 0 | |||||||||
Derivatives not designated under hedge accounting | Foreign currency derivatives | Pounds | Other Liabilities, Non- Current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | $ 0 | |||||||||
Derivatives not designated under hedge accounting | Cross currency debt swaps | Euros | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Notional Amount | € | € 160 | € 500 | ||||||||
Derivatives not designated under hedge accounting | Cross currency debt swaps | Euros | Prepaid Expenses and Other Current Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 5 | |||||||||
Derivatives not designated under hedge accounting | Cross currency debt swaps | Euros | Other Assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | |||||||||
Derivatives not designated under hedge accounting | Cross currency debt swaps | Euros | Accrued Expenses and Other Current Liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 0 | |||||||||
Derivatives not designated under hedge accounting | Cross currency debt swaps | Euros | Other Liabilities, Non- Current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | $ 0 | |||||||||
Derivatives not designated under hedge accounting | Cross currency debt swaps | Pounds | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Notional Amount | £ | £ 400 |
Financial Instruments and Ris_5
Financial Instruments and Risk Management - Derivative Tax Effect (Details) - USD ($) $ in Thousands | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Pre-tax effect of derivative instruments | ||
Gain (Loss) Recognized in AOCI | $ (3,101) | $ 4,525 |
Gain (Loss) Reclassified from AOCI into Income | 1,745 | 516 |
Gain (Loss) Recognized in Income | (24) | 875 |
Foreign currency derivatives | Cash flow hedges | ||
Pre-tax effect of derivative instruments | ||
Gain (Loss) Recognized in AOCI | (467) | 2,319 |
Foreign currency derivatives | Cash flow hedges | SG&A | ||
Pre-tax effect of derivative instruments | ||
Gain (Loss) Reclassified from AOCI into Income | 338 | 1,196 |
Interest rate swaps | Cash flow hedges | ||
Pre-tax effect of derivative instruments | ||
Gain (Loss) Recognized in AOCI | (2,634) | 2,206 |
Interest rate swaps | Cash flow hedges | Interest expense | ||
Pre-tax effect of derivative instruments | ||
Gain (Loss) Reclassified from AOCI into Income | 1,407 | (680) |
Cross currency debt swaps | SG&A | ||
Pre-tax effect of derivative instruments | ||
Gain (Loss) Recognized in Income | 0 | 875 |
Forward contracts | SG&A | ||
Pre-tax effect of derivative instruments | ||
Gain (Loss) Recognized in Income | $ (24) | $ 0 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Beginning balance | $ 1,488,811 | $ 1,327,339 |
Other comprehensive loss before reclassification | (3,101) | 4,525 |
Amounts reclassified out of AOCI | (1,745) | (516) |
Tax effects | 1,131 | (850) |
Total other comprehensive (loss) income, net of tax | (3,715) | 3,159 |
Ending balance | 1,514,908 | 1,356,422 |
Interest Rate Swaps | ||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Beginning balance | 4,394 | (2,126) |
Other comprehensive loss before reclassification | (2,634) | 2,206 |
Amounts reclassified out of AOCI | (1,407) | 680 |
Tax effects | 949 | (680) |
Total other comprehensive (loss) income, net of tax | (3,092) | 2,206 |
Ending balance | 1,302 | 80 |
Foreign Currency Contracts | ||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Beginning balance | 553 | 2,328 |
Other comprehensive loss before reclassification | (467) | 2,319 |
Amounts reclassified out of AOCI | (338) | (1,196) |
Tax effects | 182 | (170) |
Total other comprehensive (loss) income, net of tax | (623) | 953 |
Ending balance | (70) | 3,281 |
Total | ||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Beginning balance | 4,947 | 202 |
Total other comprehensive (loss) income, net of tax | (3,715) | 3,159 |
Ending balance | $ 1,232 | $ 3,361 |
Segment Information - Segment I
Segment Information - Segment Information by Segment (Details) $ in Thousands | 3 Months Ended | |
May 31, 2023 USD ($) segment | May 31, 2022 USD ($) | |
Segment information | ||
Number of segments | segment | 2 | |
Sales revenue, net | $ 474,672 | $ 508,078 |
Restructuring charges | 7,355 | 2 |
Operating income | 40,641 | 33,939 |
Capital and intangible asset expenditures | 11,877 | 76,202 |
Depreciation and amortization | 10,715 | 10,498 |
Home & Outdoor | ||
Segment information | ||
Sales revenue, net | 217,144 | 234,263 |
Restructuring charges | 2,790 | 0 |
Operating income | 22,116 | 29,793 |
Capital and intangible asset expenditures | 10,960 | 72,731 |
Depreciation and amortization | 4,402 | 4,495 |
Beauty & Wellness | ||
Segment information | ||
Sales revenue, net | 257,528 | 273,815 |
Restructuring charges | 4,565 | 2 |
Operating income | 18,525 | 4,146 |
Capital and intangible asset expenditures | 917 | 3,471 |
Depreciation and amortization | $ 6,313 | $ 6,003 |
Segment Information - Revenue b
Segment Information - Revenue by Domestic and International (Details) - USD ($) $ in Thousands | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Segment information | ||
Sales revenue, net | $ 474,672 | $ 508,078 |
Domestic sales revenue, net | ||
Segment information | ||
Sales revenue, net | 359,559 | 396,746 |
International sales revenue, net | ||
Segment information | ||
Sales revenue, net | $ 115,113 | $ 111,332 |
Revenue from Contract with Customer Benchmark | Geographic concentration | ||
Segment information | ||
Concentration risk percentage | 100% | 100% |
Revenue from Contract with Customer Benchmark | Geographic concentration | Domestic sales revenue, net | ||
Segment information | ||
Concentration risk percentage | 75.70% | 78.10% |
Revenue from Contract with Customer Benchmark | Geographic concentration | International sales revenue, net | ||
Segment information | ||
Concentration risk percentage | 24.30% | 21.90% |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Income Tax Disclosure [Abstract] | ||
Income tax expense (benefit) as a percent of income before income taxes | 15.50% | 17% |
Earnings per Share (Details)
Earnings per Share (Details) - shares shares in Thousands | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Weighted average diluted securities | ||
Weighted average shares outstanding, basic (in shares) | 24,049 | 23,865 |
Incremental shares from share-based payment arrangements (in shares) | 85 | 257 |
Weighted average shares outstanding, diluted (in shares) | 24,134 | 24,122 |
Anti-dilutive securities | ||
Weighted average diluted securities | ||
Antidilutive securities (in shares) | 156 | 29 |