HELE - Earnings call transcript Q2 2022

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Operator

Greetings. Welcome to Helen of Troy Ltd.

Second Quarter 2022 Earnings Call. [Operator Instructions] Please note, this conference is being recorded. I will now turn the conference over to Jack Jancin, Senior Vice President of Corporate Business Development. you. Thank

begin. may You

Jack Jancin

I of Good company’s Quarter and Call. Fiscal call Mr. as for operator. discussion a of forward-looking will of The CFO; the to on comment Corporate and Senior Mr. Troy’s the Brian then statements. follows. is our morning strategic Second XXXX Mininberg, financial performance this begin morning, initiatives; you, the company’s with review of will welcome comment for brief the the the the everyone Finance Julien Helen agenda quarter will ‘XX. CEO and company’s Thank financials and Earnings Conference Vice detail Osberg, President specific company’s progress on more fiscal Matt Grass, in outlook on

Osberg us forward-looking current have Generally, will take other worth Following identifying anticipates, events Mr. on forward-looking are to this, questions similar future believes, today. are expects contain financial certain conference or Mr. for call statements may that with respect statements. management’s based performance. Mininberg, Mr. expectation and words words This you the and Grass,

non-GAAP include non-GAAP that that subject cautions This Forward-looking are information. uncertainties risks conference company and non-GAAP actual to cause the may from listeners anticipated number results call also maybe of to are or to not non-GAAP reliance differ measures not considered place results. These a forward-looking maybe other materially statements financial could GAAP than statements The alternative information. to the and calculated information financial by differently an financial information parties. information on disclosed undue

measures. to at earnings can over parties of Investor conference a will posted releases inform the Mininberg. call the tab to release financial in to section over to release reconcile the interested obtained their release copy Before company’s has Mininberg, that turn earnings homepage the Mr. selecting the would Relations call company’s now to press tab. the website tables The The be I on I by like been Investor corresponding GAAP-based I contains www.helenoftroy.com. and that turn non-GAAP of measures Relations the today’s all Mr.

Julien Mininberg

thank higher with I Thank quarter discussing looking earlier we EPS the on to and to everyone you, Jack. revenue forward you topics Good today, organizational you. for our to morning, that providing and reviewing ESG am on second outlook announced our joining progress, several updating results perspective you important to us. and

so, via in quarter provide doing first and a the update matter July call presentation to I want brief our on August EPA in discussed in filing. X-K investor Before and our

the August, filtration the July, EPA levels. our modest to began I limited labeling we in to In increase. returned limited to existing shipping had to pleased quantities. PUR normalized continued filtration that September, quantities subsequently And implemented to communicated impacted changes began on has more the products in that approved the of at and our reminder, EPA month. changes the our the we shipping shipping products shipping a volume am end of air for approved we we packaging that claims water As packaging, report which and

normalized the we more and to the on needed main activity Honeywell resolved products for our and rapidly. that filtration air rework a matter end largely level accelerating to return work of inventory EPA our message by currently the of the to quarter expect We is Today, ‘XX. third that labor are material shipping fiscal of our have effective

in turning them the appreciate putting patience customers. for of We we a good marketplace. millions the affected PUR, closely they us. On thank our and We the us position are progress making have in serve their to better on how are worked retail tide packages, with

and progress significant made We have reducing back share. earning out-of-stock on market

since is also worked out-of-stocks and minimize the who shows and data in up not I and well More of mid-August. and be is matters to the at they They would and finest share primary XX extensive is of to to impact our these I than culture a resolve often hundreds it’s This air-affected or on and purifiers the to XX seamlessly market underway could by associates points the flow of the its action. more fewer business. retailers points work the have our Troy consumers, more of like rework focus. thank together complex prouder than improved have syndicated by Third-party more to work without clock. through complaint. Helen tirelessly way Troy impressed around Helen

turning the our quarter to quarter exceeded our overall, results, expectations. Now second

and delivered again with Home once increases sales EPA to quarter & year Housewares Health second declining less the and the growing balanced over expected we result portfolio fiscal both resolution of favorable the diversified Our Beauty during than a matter. in major double-digit last

the sales Our growth of leadership Tools, ago Home Hot second pandemic. quarter. in a had Flask and which had all headwinds excellent Drybar, brands Hydro led from in outside the year Health solid & International growth, by faced the base of

to due impact EPA decline two we the Turning of address matter. of sales, decline in was to approximately this our stop-ship the our online reflects two-thirds the first, quarter XX% as things: action

COVID penetration store trend similar our to in represented online. sales XX% quarter, shopping that brick-and-mortar even fiscal sales though to mind, returning top remains total accelerated this of were many when Second, in online in-person online study. Even compared larger closures to are previous shifting COVID-related brick-and-mortar the of our pre-COVID of year of consumers more the sales,

mix The affecting brands of and of to the of adjusted our of expansion seen results as work sector every global as report in as adjusted by the the peak EPS EPS at such sweetened of our offset expenses of our blunt versus reflects look much supply some operating to our levels to possible done core as the be across the the widespread hard gross the chain pleased core level nearly the also in the significant It work are ahead $X.XX, the during and the the sales especially back expectations. our the from normalized the from compared adjusted and our spending to nearly profit year-ago to growing economy. margin an we reflects are levels was costs comparisons year EPA pandemic headwinds significant material, fiscal difficult input partially transportation depressed as despite address supply chain-related in labor this flat all headwinds. which base. We more of matter highest-margin well deliver half achieved prior year, EPS impact despite as to We period. disruption pleased first Stepping inflation of

basis an year. at Taking in half first our year grow in investments chain those our the and last a both and Our Beauty cost of this inventory core diversified significantly of supply – a portfolio look have major Housewares important where role their played this higher been over mitigation us and challenges, earlier positioned busy hand QX of QX meet inventory meet inventory having We back plans. on and more in well believe to disruptions. the help demand our fiscal season Higher consumer half this of manage chain and ahead customer also better expectations will supply in demand year. meet us in

at of considerably We than our have also elevated good lower market. current made the pre-negotiated rates sea freight spot use contracts

the of to part realized which the of with second on increases implement fiscal third quarter price other most plans, mitigation will half As into brands, quarter. year the certain second began place the of ‘XX. we benefit the in Pricing in and brands became being take of end our effective at the on

second of our to and incremental value. short growth in deliver touch the XX.X% top in way, our the inflationary experienced that second the We led costs, units, operations our to growth taken and is key enthusiastic objectives. in dedicated is our initiatives on like X results the have segments solid Housewares both abating the business associates the world, in at exact place strength. to market balance business growth quarter. and chain net reduce believe They continues invest for disruption team that our furthering shares powerful very approach posting I Phase of to mitigation including of price needed drive year. of have pressures formula managing OXO and X.X% supply up show investment a the create on sales our increases Both by reflecting to continue right freeing combination brick-and-mortar address the all growth containment our diligently oxygen I’m which to pricing, of and pumps. They, with along to global in shareholder organic around the on protect further are for We fire. last contain domestic of designed now currently Hydro consumer quarter measured our highly of the to would little growth Flask of additional to and key plans, whom are engaged, price worked of transformation of exploration international retailers. the growth, and proud and sign term. our to putting the OXO

investments with orders across with cloud. in sell-through profitability be broad-based a Hydro from discussed in improved lines part along the in become stronger calls, current Asia-Pacific. brick-and-mortar As all and market internationally, also those region. and Hydro concentrated Steel postponed retailer even it in replenishment with primarily quarterly strength of increasing seeing promise better and that EMEA during to growth strong that prior younger that more at top acceleration On domestic paid new of COVID. brick-and-mortar households to long ordering, believe faster, exceptional sticky. were We with the Internationally, prior to and as expected with traction kitchen healthy have Good are domestic support retailers surge continues OXO growth we in due plans channels, OXO’s grew competes. growth, in the are where season works retailers healthy except is have the a the products Canada saw the even OXO’s also the Flask many and especially are in replenish we pandemic visibility. future line contribution category products earned based Flask broad and by consumers in the consumers. off driven pre-holiday gaining back-to-school made specialty customers and penetrated new inventory U.S. Grips familiar in growth strength OXO we strong OXO in in for saw to – and of demand. leader that the during

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second the of sales a the year. of divested of were quarter to business sales of in delivered the consecutive XX.X% Turning Phase in excludes continuing quarter Total finding transformation X. second Beauty, in which Beauty segment its year, the began impact in quarter, On quarter. remarkable basis, in that core X.X% the that growth middle growth, of the the XX.X% XXth its story over sales June Personal grew we last Care this up

leadership brands improved and the by brick-and-mortar the Hot Beauty, strong growth led Our with Tools in stores. belied traffic Drybar at demand, consumer

sales to pre-COVID focus growth of appliances, its Head. a Sales the channel, are from reopening best regions and is higher brand be paying off year and expected Hot Drybar expectations improvement of strong brands, With and to strong Revlon good, contribution with contributing on is beauty expanded Our are innovation, consumer-centric having our making salon, paying on fiscal a are are a brick-and-mortar and our innovation in strong and to trajectory. profitability. contributions These strategy considerable terrific and distribution in ‘XX Bed and the ahead of product dividends the channels growth and margins Tools, the Drybar, across mix. in these better,

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a you repurchase time in share million the added at have our position putting continue press from stock opportunistically to may quarter, authorization As of the recent in end seen release, repurchase to time. a $XXX we a us to

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next Phase our broader with of initiatives in our to embedded strategic Helen X ESG into our the is step refine that key Troy. report, and mentioned overall that strategy drives all As do further transformation we plan

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executive the industry years of additional on consumer the on in products the add outstanding represented top global XXX-plus Board. First to is experience already

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would of we for that make growth built X over in XX% our now have than EPS and multiyear organization, we team more our Those out that helped been period. talented team years. powerful growth comments. building last adjusted have years we that of capability leadership like few been culture more place our you Turning of the who in drive than have have This and transformation the organizational many time same have and revenue XX% know now to to I following a

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nonessential until organizational proven update to provides our is to week prioritized of Delta week. I’d and of irreplaceable hybrid All to variant, extreme our the the implement to in-person we that developments sticking first, Taking power our postpone days return-to-office a health intend our we return we which our proven as plan. the remaining and balance well like believe the collaboration we and our the to stock best associates, during to the powerful workers recent combination work be quarters the model have from a walking to X of on have safety Another home share putting culture. circumstances decided the ago, provides discussed along, during days office four the several of These benefits each people principles as X COVID-XX. for January. of We talk have time normal elements same the during

Before over the significant the turning of years. his company our again XX I to call Brian, success contribution past to wanted to the over acknowledge

leadership, have transformation, thinking the his key made him with During business asset insights and a our friendship. stewardship finances strategic and of outstanding

now will Troy, the to the make we Brian. of valuable forward demonstrated previously the the With over continue years As already will X his business Helen turn X. into Matt and contributions X beyond. transformation in the all Matt to CFO as past November role that, chair stepped look in CFO organization strength, the Osberg our announced, I of the and through Phase has on officially call of Building he in on many of over I

Brian Grass

review outlook morning, year full the quarter make and detail. handing high fiscal Julien. I’ll ‘XX before for thank revised in level who will joining Good more you, comments our you us. for everyone second Thank and it results over the some Matt, to

efficiencies, and investments flywheel the in saw people demand are of The beyond. for really second pleased ‘XX We we remainder continued product international and positive our of operating strong they of our consumer expansion and services shared Housewares and with Beauty are our paying number sales off. including a We the quarter. trends, portfolios fueling across are and and We fiscal elevating our innovation, unifying believe business. made

resilience Our declined Home Health but would from incredible of circumstances. going & miss we Northern and the honor our best I’ve believe in possible during without soon. under with had achieving here. operations team we None matter, time Mississippi working but segment EPA outcome of be come due the its of primarily working guys the sales are leaders to the you that the my possible it to disruption I’ll I’m visit strength and with

our continue pressures, supply and improve pleased the I’m mitigate our growth fiscal ‘XX quarter we the to in able these disruption long-term we we cost to of to EPA challenges toward due are inflationary favorable-than-expected and doing of face second outlook the to chain Although continue maintain strong are unprecedented to also matter. proud more the that very work trajectory. full global the momentum a I’m results and resolution

I of very and hand Finally, good mentors, I and all shape of incredible the good for to is at fiscal has the Julien, my of wouldn’t what to a going company’s farewell I’m the yet the and through I’m express detail. working to the trade helping and have and hands. over final ‘XX gratitude especially Helen I anything. Troy, The accomplished, And to and to great that friends people quarter experience the like my I’d us proud my believe that, career more spent this been fortune just second Carson. I’ve in outlook Board Vince in with Tom with, transformation Benson had take Matt that of talented we company it best is say come. and to an majority

Matt Osberg

Brian. I you, is your mentoring. Since leadership this thank you for our and work, financial hard final Thank say to all want handoff,

you and best we endeavors. wish the You in will missed, of luck be new the

believe today. business and at metrics the core operations As excludes our look remarks the look substantially results on entire we basis, business with basis, best will the comparability Personal future for our where Care to Personal of all the impacting provides sale significantly we historical Accordingly, between at results, Care of I appropriate comparative periods quarter periods. the the in in useful core is which be us a a on of all and referencing my it

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costs. to spending due in line The compliance period On of by to primarily driven unfavorably we compared in effective expense expense decreased margin in the the before our were and outstanding. restricted ratio EPS Non-GAAP impacted X.X higher our sales ratio EPA compensation segment as operating lower-than-normal declined In year percentage higher and unfavorable tax the by due the primarily million XX% diluted for last these tax of was from basis, of XX.X% areas personnel SG&A On tax full tax was & quarter to year period, XX.X% $XX.X freight tax tax offset period. operating higher diluted of the effective roughly was a percentage $XX.X tax XX% was XX.X% current advertising the income the rate income net levels in SG&A expenses full to rate mix from in grew expenses, tax effective as also Home second and in the XX.X% Income Health our million code share. the – diluted higher-than-usual and to more $X.XX company’s income $X.XX In a operating as per basis, adjusted year. temporary income higher segment primarily sales shifts a benefited cost partially income by XX.X%. share-based the both an jurisdictions leverage, XX.X% in normalized due income taxable operating Net points and X.X weighted due rate GAAP various well is X.X% points higher as income reduction operating revenue. significant of initiatives. outlook. operating year in year-to-date was rate lower same forecast. to updates to expense, or average distribution or related as interest Beauty income adjusted to shares adjusted with increasing lower percentage and increased prior period, to we Our leverage current

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outlook second our be the for able sales EPS to stronger-than-expected outlook year sales increase earnings increase full to of of turning reflects both The increase year. to to fiscal expectations reflects quarter. fiscal for to and for our EPS quarter second the in higher-than-expected the pleased combination ‘XX, our largely outlook and outlook half the we The Now sales an our are in the our year. sales a in improvement back

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to consumers, operator drive gives deliver we the positioned And I’d with ability shareholder to shareholders. value questions. capital are it to We market-leading strong well growth our as have well a and a associates, as like a many believe for for return. turn the customers, sheet and communities continued I back that, that for balance strong with us deploy global brands to footprint to foundation of opportunities

Operator

question Thank you. first proceed. Instructions] Securities. Labick is Bob Please Our from [Operator CJS with

Bob Labick

both I And morning. to want once to just to again, congratulations offer Brian Matt. Good and

future endeavors. really We’re you for of and both excited your

Brian Grass

Bob. Thanks,

Matt Osberg

Thank you, Bob. it. Appreciate

Bob Labick

Absolutely. Great.

in any already, is revenue then, the And the from you therefore, up year obviously, but appreciated. the then the I you finish year lingering said actually that impacts impact. Or captured that off, EPA guess? So – detail. how so if QX just of make little half? issues? EPS, to us left from ‘XX hit I in in you QX get gave get you the the It’s much growth think a you your could to Trying result? better as a guess I fiscal do the tons And to this you took you’ve both don’t do that expect of back guided And and I apologize, sense I EPA a impact

Matt Osberg

take. I Yes, can

Julien Mininberg

fiscal Yes, Matt, I little QX, QX, give on color why and don’t a can the handle more ‘XX. please you

Matt Osberg

matter. disclose major right, Sure, didn’t talked QX exact you’re We the Bob, Bob. would impact be of EPA the that numbers. we the And

with about the ship since If impacted ship up stop we then. the QX, you think a basically all terms in what ramping categories had come in were of the had we out categories by how being stop and of were product we’ve during been

of air I’d two-thirds – to shipping. up category QX had impacting as give kind So kind linger we get a QX we into numbers one-third I of of give full didn’t that it’s ramped maybe exact it to an if still you impact overall our and a say in

Bob Labick

Okay. ahead, Julien. Yes, go Great. That’s helpful.

Julien Mininberg

does Sorry, others Bob, the have the so Bob. stuff, I ‘XX the same the and thing Bob. all And ongoing on on for fiscal impact. call, as they think may Hi, have EPA question

soon I PUR, optimistic. we we know message imagine they because and with On always hard sure have us. to business. main case highly good. been air, support In that business. doing message further the looking for I resolution retain is make business key EPA our we’re long-term along working – are very PUR, were can’t to simpler. a main would of impacts. And we’re We changes know sooner case much continuing that the of our the tell, simply the customers bit market of quite think They long-term I to The in our leader yet that to it’s we’re that earning trust have vast decades. the came them. we’re We keep a majority and have

consumers need are products exceptional them. Our and

have distribution. to until the be the that’s going to So highly just be and it thing said, optimistic. remains And seen for most important them, to we’re maintain confidence that them to long-term consistently shipping

Bob Labick

it. Got

impacts. I Okay. you. last mentioned, us versus to obviously then, up That to pressures Can that ability you’ve inflation, are give as even the spoke ramping it And makes inflationary inflationary done much And the how are how P&L? set about talk pressures? half then how it then mitigated sense. a of to you has to flowed And think, the just you bit relates been mitigate a you good kind job. or up for it, a sense without relates much you has Thank yes, through little of time very maybe quantifying to us. fiscal And second the back as with question, same ‘XX

Matt Osberg

Yes. I’ll to maybe in. start Julien, then, free jump feel on that and Bob, one,

to – ended in defer the the that and levels this came as year As have costs higher with good talked to a as the inventory, of we’ve we you know, we – as year. some been we at way increasing of freight were seeing rates, look during we’ve about particular, year, the that

– the compared second increases. an But those year. half talked everything won’t has offset second in about will the put with will of unfavorably impact gross mean, that first of because coming as there to largely are offset of price been in to fact be the in us increases through move the I’m a in I down and that second year. the half last impact but able going more expecting help as the the We’ve that’s high to the price year, we’ve year So and we level, increases, be now it’s half at on that the profit price we second of year half the place

But and it as the the will So the of total little in lot a margins gross we’re but doing see will our we to due try a think, half. erosion, impact we I second year, things profit bit offset for other impact of to it. said,

Julien Mininberg

how stay. question, every your of on a much part long pretty second out page front Bob, and of they the of the newspaper high how world the ‘XX, nature day, fiscal inflation, it’s the there go, speculates For tough long-term any things business

but the accordingly. going had not to assuming look So we’re is Or transitory, is is is positioning permanent? a to inflation and like we’re lumber to also boom going the curve it ourselves it look be that flat? going it like where something But

thermometers So on is call increases so exclusions, the will as the working put like frankly. we de-risking, the included, whether get example important. to qualify. more price think and announced set administration forward U.S. in case tariff that we’ve in know representative we against as been of the hard possible before. don’t the to will costs round our and just number of yet, as many trade been essential about, products opening than others, I initiatives, our of here rules not playbook, Matt’s buying, knows another raised human exclusions, talking Biden guidance. for are tariff of those chain, like But behind an hard have that that life we $X.X the we work And Working potential the I productivity of our supply especially everyone mean, worth delay, us

they And in what We, came. with worked the We’ve just done some there So through tariffs inflation. credibility, that think, when worked through I else, it’s statement. everybody we’ve COVID. is like not

We’re tough.

We’re this. not by going to be beaten down

plays and ‘XX. fiscal it plan, And for we see will so out our how that’s

Brian Grass

year. full the the It’s half what or year. totally Just full in for fiscal to – sorry, $X.XX not we’re be fiscal digesting clear, us of year. the for first $X.XX is the That’s behind the

Julien Mininberg

yet Yes. in coming there on raise its not Brian. that press year today’s all of say of pound, chest food at unexpectedly call and simply us mentioning the $X.XX during the counted in if full to that people people the fiscal out Thanks, inflation on company not have environment. only thought that, that’s cost probably is would release. but the could that of And point guidance at what’s with But this

Bob Labick

Got it.

that second promise. The there top back And the you. I high relatively we could last is with and comps. obviously Maybe I flat through the puts is in terrific said comps kind forces quarter guidance growth one, excluding and you queue, crazy for Obviously, of really half, then lots normalized Thank takes of the as is us more a of Okay. kind Housewares high forward – of for and see another level. Housewares and and, just you and line the for I’ll to that get super had get off the once talk comps. going expectations, and underlying where drivers

Julien Mininberg

Happy Yes. do so. to

core of Beauty growth means all, and on of their Beauty a just the from excluding – and two year. It’s First current Care, it’s which base both just quarter also XX quarter just – high full year not the its lifted last both top for ago basis, on guidance Housewares. points a of the the and Personal in base future. the

going things happening your point a forward, Housewares basic base. is Zoom in and in We These people the has in is What’s seen too. that year, to but at habits home. all not. So a the of the school. couple it them kids COVID The brand – about can the mentioned we’ve remarks, high things. prepared abated, stickiness time the have They of

there of excellence is the it in of think the is penetrating households many materials, the the durability once whether recognize we’ve exceptional so sharpness, items, the discussed And they rabbit the performance OXO which the that one people because or times, tend peak multiply the design, two like more is of products, is too. grips, feel of items the the effect household to households, they

calendar mentioned truths, also is ‘XX were There into Europe other that – lot for and that that that is is There a is push our sticky. is ‘XX, especially a this weddings frankly well fiscal So remarks true. delayed also international on is Housewares, doing side. We prepared which there of is lot more our in or continues. calendar

profitability Europe investments. now to that improved and projecting ROI and in greatly we’re the initiatives we meaningful higher against continue, invest We’re now to the getting that that those for growth turn have for into the some Housewares flywheel is that

products, from Housewares machine. on is Taking there OXO to it’s don’t is famously comps circle on positive our can actually opposite also We anniversarying not Flask. at when but standpoint. situation. say It’s there. is by But mix new it’s winning. the brand. also Hydro And a look true It’s Hydro making doing it’s in just I beautifully. a brand disclose it Hydro not Flask, Flask significant just it’s year-over-year weaker a productive margin up and strongly. progress comes a And It’s So but

most Drybar. So behind profitable our second it’s brand only

Hydro trend, a good coronavirus wasn’t friend back-to-school. that year-over-year back-to-school was despite are especially things there these Hydro for terms still our Flask, good out Housewares. kids are last of international it’s the And things it’s and Hydro the So the because families big And that the and more all in the on bottles, trends, any as the Flask, for Housewares, we And where expansion being with whether deal, about we’re in going our other and for favorable for Flask. us, fact that’s favorable etcetera. for are bottle other of mix in hard beyond all a lot this new the do case collections year,

plans. our like we So

We major also like where stand the we with customers.

similarly but And from grow volumizer a story. not anniversary a and Beauty that’s for able positive story guidance. also and go in And to there with on is didn’t just ask the about being you I space reflected know Housewares. It’s so there, our Beauty, a

in the well doing wavers. We’re

Canada well. also In is also We’re doing and Beauty, going EMEA beautifully America. in in Latin

And the plus, There to in so it Revlon I Drybar a that ton new coming new lot the products Beauty us awesome like just is mentioned. invest into. a gives out products of

for these of are things Beauty too. positive All

Bob Labick

Super.

you Okay, much. very thank

Operator

from question & Oppenheimer is Parikh proceed. Rupesh next Company. from Please Our

Rupesh Parikh

Good question. morning. Thanks for taking my

you I to X.X% average, pressures guidance, think, out at two more a commentary just the about that there. the also growth with still back is saw have know raised next on least feel targets? fiscal guess organic X%, higher just call that I growth X.X% comfortable there that since do you years you now delivering and going those cost base given you And of in I to sales EPS adjusted So guys last

I’m can So you there. sure if not thoughts updated provide any

Julien Mininberg

– for years, This you’re future the about is Rupesh? for talking right,

Rupesh Parikh

two next That’s correct. fiscal The years.

Julien Mininberg

this the X we it in not we our that as commit the did COGS, periods, remember, climb down I even the come Phase has said, it’s to we Yes, hill those higher costs talking gotten causes about only And goal. am the flow prices short-term. talking fiscal to were moving That inflation cost in But off are not flow higher. that and plans, just about actually get through to the if commitments. inflation of certainly through year. and persist to into they future our

And That so if there are we the line. hill good prices our prices our it makes for out short-term, prices, raise challenges top If higher in said, persist climb. further, the the just there. higher to are

are it we So, and to the offset, consumer-centric. of helps do some yet

to is of of mitigation, the the extremely accounts needs now. to of are before, points, period a not putting hard over it’s bank worked even to as much spending sensitive think of worth the were of a government the they in I direct about time. money, government quite of we being price our is consumers and is And case talking stimulus, $X,XXX the right So, lot people long competition, like the and playbook checks in though

In have reviews our this year fact, that do we next time. we every strategic week at

is So, make it’s not top that On playbook come, find of where we you exercise balance goals is. unique to to sure to center But fiscal way stuff, that see our which sheet and and how the fiscal where organic grow. ‘XX. front is ‘XX can for those our

leverage, find on you that of you plenty measure we signaled the which work X.Xx get and room pretty And have is are us those hard the how and land. several to use, gives grow we to involved to that acquisition. see we We there above but it will case, acquisitions idea also regardless. base X.Xx, are That’s us for in depending a and the prospects, ways chance beyond

Rupesh Parikh

out then and that now the the significant there, this great. past one are called I And Beyond Okay, Bath moving stimulus further year. you I stimulus of we guess Bed or retailers have know seen just certain the guys look earlier move past you as in challenges, any behavior? have the we at seen the in COVID as out business, just like was consumer really curious, notable your some I markets. sites stimulus, you And changes

Julien Mininberg

And slower although the checks after the even I benefits. – are general, Not with workforce than in everybody talking I yet. about unemployment am not People to returning the extended anymore. am expected. the government stops talking about the

longer and So, more there lot is people days. shifting there that these are on paid of are no still they to about is but going concerned a stay home, coronavirus

employment creates this in churn the some So, base.

higher, won’t at Our supplemented generate belief economy positive than still therefore, wage inflation. net jobs. Wages make that’s by to higher the inflation also extra moment, and payments. those the that are And these continue the is that their jobs a just is goods as will

although money government taxes have about pocket not their yet, So, talking and people been this. have the in is more raised

possible take some so government of people, of depending out will And stuff it’s how all the on of that money some pocket that the out. shapes

on is So, enough will it down. that be slow are going that there them consumers concerned, we drain frankly, to

drive meaningfully market So on our balance. that with will on to been providing right products are years from share. competition, working that’s the strike exceptional the We, hopefully, playbook meanwhile, consumers to value massive keep will XX government and for differentiated the

get And items is talked inflation the going with just it one. to until attacking about at will done. all the we that are that’s costs, we of this how the So, keep terms in we playbook through

Matt Osberg

buying I of on you about one I And without earlier kind market, you maybe have and are remarks. about of sure asked add some with have disruption to make seen this talked chain are to bets the goods making retailers are bit and And consumer I a little a persisting head our buying make season. holiday more Julien, that. Rupesh, think they that’s the I without retailers “normal thing year” to not they their pulling trying of sure just macro they in that than in on still are think behavior. lot would not as a prepared their in trend, where would supply forward this in think making But that We into bets a patterns bigger inventory that they product.

I go. more kind start would how your in, that’s And sell-out the the behavior it shift have that trend to QX. will and during could to do something see season, to once our retailers the as point, it that what’s a we consumer be revenue holiday impact and think QX as of that, then it does So, in

Rupesh Parikh

great. am items point, really sure but you then this guess color. you just going are one next Okay, maybe accelerating. cost to as year, at are fiscal clearly, one, helpful That’s to and last not I I this whether And answer I mean, look

operating headwinds you on to you actually taking year, out expand look actions. could guys all You guys at pricing More And come. there. are margins the are with pace this

at now, you too levers as early it it is have dynamics If look year, is look you expand you that? next operating all at – guys different or right to to like think margins this you these to do point enough do

Julien Mininberg

the early. guidance out way think the fiscal laying I ‘XX. best increased we too just guidance, for – It’s are

‘XX the the not broad headwinds than that are are strokes for long-term there. We guidance And X yet are and ‘XX. giving fiscal other acknowledging of Phase we

and are hopefully have stopped the also by no to every got market single day. out, We it we of have that That getting play them. across changing we clearly said, is very intention being

think whether we soon able of margin terms I do be just In that. expansion, to will say the too to it’s

in everyone an one is the priority flywheel ‘XX fiscal turning. is key keep Our environment at to looking for that like the

lot flywheel does a So, better that all in than forward the reverse in gear. does gears it a

higher now. that the transformation. The And in work can be and working the to and can That’s invest ever new initiatives investing improving we we so with that in right revenues, that’s we to that plan. the the much keep on know provides cost, where are is stuff the oxygen in better margin, make question all gross in the keep a on it’s higher math the brings we what position

Rupesh Parikh

great. Okay, Thank you.

Julien Mininberg

Rupesh. You bet,

Operator

proceed. Company. question Lebiedzinski with & next Anthony Sidoti from Our Please is

Anthony Lebiedzinski

with Julien of Hi and going questions. the working you, look best Matt. taking and been luck working it’s forward for with to you Thank forward morning. and Good you, Brian, nice

So few yes, a just have questions.

us just have an plan So, actually, to to do. – of the increases. price that you about taken and level if give you as guys you increases you expectation price or talked Can could about just talk

as just better half terms a of for the of basically understanding the for year volumes? as the so So, guidance back have far in can we sales pricing versus

Julien Mininberg

Yes.

In taken, would we increases. comfortable terms feel it. But about reasons, speaking for I comfortable price not of future would already speaking about competitive I one feel have

In accept and terms And have it’s of because the I consumers, on mid well. is not shelf to product-by-product, They easy inelastic, as situation, not mentioned. generally digits you some points situations, not competitive lot increases. increase. a that classic low-double we as classic hard those in are price But even high-single challenge it what trade if have the already the stuck. it’s And the harder for bit taken, the raise super brand-by-brand, market-leading digits, that then a on – when have to therefore, ones to demand price where it inflation in depends there and It’s are It then retail you cases, knows its brands we depends and is. to everyone sometimes volumes the into prices. customers. It’s said, price for curves that cost

more be those numbers the with. that is less working walked to we there tightrope So, that a needs are are and or

on We the ourselves with don’t consumers it pressure of don’t the be ones, Rupesh goes, The see future right. future want and could For about will the market. just we that trade it we disrespect to how to Bob, real, and want in out or price the spoke customers. consumer we

will right So, find we the balance.

Anthony Lebiedzinski

for Thanks Okay. that color.

I EPA retail? know you sell-through of the So, in gave recent comments PUR. what terms at been about impacted the products, some has

sell-through is that helpful. to maybe additional give the So, of seen if others? that, have than better could say us be guess safe color PUR But on I that some just you it you would

Julien Mininberg

because Yes. an had This low is it’s stop shipments the If academic the instantly of during the might exercise less an no all ship shipments world if messier or place the real say shelf, the put important and had is than captured back little inventory, inventory that academic just that. on they it’s we market stickier than even period, all The to trade people a that think question. of sort dollar. the or on cents share XXX will then products the

stocks so knock to takes And out the it what one-by-one, is back really of store-by-store.

that in alone, to points the last pretty we since announcements. prepared six have You those That’s made out-of-stock remarks heard improvements it my of PUR weeks August in sharp. added we

are PUR PUR working this phenomenal have that is trade it’s of that terms of behind about us. We shelves points for for weeks in by very XX in reason, the and And proud positive full. and our been In with market the our have of time. shares, their and consumers We products. prefer stocks same on back want those want case X us. that, customers Air, increased They our

then right So, you his the back are as quickly has be put we to costs forecast. written. similar engine. talked on that. hoping and prepared top in relatively want. of to It’s restart and they buy we story it. putting our about and buying the of we they market remarks, It that be half Matt may included are that front the make want are But their also And not pay back and with shelf as products don’t else for make But back yet center with in us situations if the sure clear money in comes crystal we to to outlook are for the that investments out-of-stocks the the share with choices consumers be mind, something the they

know sure So, that’s would our the into it not products worked this, plan. gets get the to The comes it record. may On call as through. but the people on air all purifiers, I make like

talking rework air. not between about million of and water X than We small This are more task. a pieces is

Our team work. is doing amazing

Then getting heard have investment to products. go the through through as the out-of-stocks, Air, into get we hands quickly not the but PUR, now. as and significant possible. And patience progress we story, keep go the you our We on happening through the try then patient been then is made are products their have their those and customers we to share trying them that market

Anthony Lebiedzinski

it. Got

the spill terms third of so guidance, costs all be have the And second for will is compliance Okay. quarter? or the over to the of you quarter, EPA year, then in fourth of any the half that that in that into the going

Matt Osberg

Yes.

Julien Mininberg

speak? you Can

Matt Osberg

add-back for of that say would back this. the the half to year. in the There Julien. compliance is Yes, I Thanks, are we Anthony, doing of rework the costs, will which Yes. be EPA kind cost the for costs

we working X over it’s through that, to QX million as said, probably well Julien in actually will be that think pieces in as units. rework, look As QX at we and and those

Anthony Lebiedzinski

it. Got

impact But the think Washington, what any I beyond? beyond could us potential lastly, for guidance given just what the wondering tax but – you then And happens ‘XX you as tax are know rates excluding and this rate, Okay. give some from know in about mean, far now, as fiscal sense you fiscal that to us if ‘XX, we how obviously, gave as I year. we should for fiscal

Matt Osberg

state if Yes. that at say mean today look you looking similar a I think are operating rate. be would changes, with tax type we of the at same I no in we

Washington things or kind tax happen of happens mean that the and in may come will drivers next and big Whether be I think rate resolved, is domestically. put future will those place tax our that Those what in effective with the and getting rate. of take up of can what it’s even what think in – of time. being ends year, drivers I globally out I big

very of should excluding of would kind legislative consistent change, next year. any say tax so assume And that into rate I you a

Anthony Lebiedzinski

Got very of you much luck and it. best thank Alright. forward. going Well,

Matt Osberg

Thank you.

Julien Mininberg

Anthony. you, Thank

Operator

Our next proceed. question is Linda from D.A. Please Davidson. with Bolton-Weiser

Linda Bolton-Weiser

you? Yes. are how Hi,

Julien Mininberg

Yes, hear to good. Hi, Linda, from you. nice

Linda Bolton-Weiser

am little the bit I segment. I & a what in in interested is guess Health Home

you like didn’t that, it kind You looks – like exactly wouldn’t the if organic guess of were impact still of sales I quantify the but EPA looks issue, it down. you excluded

really You too. had hard in comparison next a very comparison, quarter, the but hard the remains

kind last this So, to not growing get but these hard were said against for think I you down thermometers, am were or just thermometer trying they And of on flat, you quarter, said the are you sense I comparisons. a sales quarter. whether

it I the – and guess also and is POS and data doesn’t thermometers. it know So, growing what but well thermometers shows that I changed you whole wondering on for really actually shows I POS thermometers, tell actually am in the story,

wondering between and just on with your or you. it’s what’s can So, explain you your maybe going POS, thermometers? like what’s stronger, Thank sell-in I disconnect the am

Julien Mininberg

Sure.

& have and question ex we broader growing So, EPA. the Health thermometers got then the about Home shrinking or

remarks. there has a earth, of clear because thermometers talking the may is to start just the with get let’s prepared I in The audience. Troy’s few on in been Helen overall thermometers in am the last months this talking confusion We situation. our of I the some category to So, be not down Troy’s about category in planet Helen down. position. that or thermometers about generally for the am and tried

to short-term. shares With seen I it shares it the sales reasonably States, rebounding sharply. to is know frankly, IRI don’t the and prepared have not can in much our a remarks, in nearly Our in actually market you I have you And down as the held not and They have are in you disconnect but we down see as the and put United worry out category. the don’t up as about POS, rebounding, in know numbers. said result, share but just as the regard short-term the well. our the

look I at to think guidance to ask our we about will it answered in think where be, that is way easiest Health the outlook. have full just Home the & and year and

affect will in year. We the exactly the said have also EPA how much

today. an in number improved gave think I out that guidance the put we we

how you two, So, if will the the year-over-year subtract perform are there. if you Home for the will see numbers & just Health

In be you what helpful over XX% look fiscal, far is this the so Health terms was will X-year very of to where see at may stack, that up pre-COVID. & Home that it it it roughly And is way.

this downs year just is so thing is, and take answer XX% the answer doing on a fiscal or is better the you if out, of ups basis. stack the this X-year far noise the The better So, worse. all

for the the look year, with you we do could same help you at We public in are numbers, If can all they total it but record. the those math.

versus stack, did case release On first highlights we in did we in versus we before, And measures. versus stack. same section on in where because, term the it’s were use we it’s and it right put and ago that year in the we were not year in don’t the That’s anyone our a quarter the press where press and all in normally, ago. about talked just X-year aware on last thing is six-month a fact, also and beginning, release, X our the this and we basis quarter the the half were key of this year we the where years

the up growing there So Home the Health color a alert hopefully, or they right. for in are to it you that the the will EPA, do just just whether help want to math comes case of sure ex provide help are and things everyone see growing. little year Matt projection spoiler shrinking & make And

Matt Osberg

Yes.

of to X-year to things provide area. starting just I release. Julien and core as we in helpful will in We we that’s comparisons One, what talked There some think yes, on So the that year-over-year. you executive as touch earnings core quarter. is first at wanted Care the mentioned, stack couple year tried our results tables primarily new are looking Personal now you about the is mentioned. a Those comparisons especially more half the of quarter. important And out actual the of summary this become

of highlight And some wanted so that. to just we

other a couple parts. business the we add lot We core did moving tables consolidated know of and matter. The is that release there within thing earnings our impact a of our talk results, excluding EPA of the non-core is about

impacts. those to the you on That’s guys just wanted there volume lot the there sales the put And little out wanted further a quarter. the back that’s in related of and all that something a that profit XX for Page new is the numbers. in back. and we We I So, to have numbers this is make that’s sure

to the we the digits of X.X% fiscal release excluding and year, is an to still there, them down Health we of what & the decline decline EPA specific EPA your which on be terms in double strong the that In XX% to the for ‘XX. down expect Home including question, XX%, so XX.X% matter, matter impact the reflects the for Linda said

Linda Bolton-Weiser

the and out on growing competitors Beauty seemingly business, the I strong, and And just you. to just a Thank growing like have similar the very even so then volumizers. am Okay. maintaining share. curious still trying on there are or follow-up with It products all yes, question you seems certainly really market well

just there do other you how that? so competitors are in up to are so expanded out? or are you Beauty following are that in how with I products more with you volumizer, new well coming So, the mean, doing But managing things the all quickly? are

Julien Mininberg

been which is efforts we been points with aspect new higher and the significant. more innovating, have price marketing media social and significant. geographically, and is been at being channels, way doing marketing, not it’s we your features The first, out putting Yes. humbly for They the in believe been then have even constantly market. heels at year first have point, And is penetrating the more nipping have And consumer just news. are a is of the volumizers product it about now. and of expanding we classics to The competitors versions the new there following, best, because

now on total number are reviews put meat alone, to Amazon a stars. the that’s the star. of The as remarks, our we those couple XXX,XXX points for So, and XX% way, bones, by in our those of about on is, franchises, of talked – volumizer prepared X.X is five

the of them in keeping the prepared Plus on the that’s best. we new talked superior our points, products about with some And first So, price remarks, just Revlon we point sharp. that about And case and are the in like that’s features.

a expanding also We are significantly situation are in where we internationally.

prepared I remarks the Europe. Q&A. mentioned have Latin in our also in about America We Canada and spoken

in those then channels. We distribution are growing new areas and

into an generating that remember will in example. last Continental key stores, some of the to some France, distribution new put expand And Europe the distribution on Our call repurchase. we people year now and is sell-through as end money fiscal and

we new next, products our we have we there, only looking positive not prospects. and but to are cycle So, going. putting a like And Asia then

winning. doing remarks. it’s us this of signature in have better the features is And have in of price of Bed volumizers, particularly as mentioned the prepared just with higher we liquids. I Hot even all example we Drybar, another the keeping series products the So, Tools the on well. wavers points volumizer type of case And the is and what’s The new not even going. is And Head at

of keep keep going growing this up in all So, adds and to share. it Beauty

Linda Bolton-Weiser

very you Thank much. Great.

Operator

final is with Steve And our Marotta from & Associates. King question CL Please proceed.

Steve Marotta

to maybe impacting and Good intimated one I bumping that morning, Jack. I last are you having the Matt don’t probably industry Thanks. with know at against based be even in I competitors negatively well. there complications on that some your will Julien, the forthcoming time, be as this so tangentially for EPA we be might want it are competitors Julien, share know limit that. Brian EPA completely you on But time? market up reasons with and question. the the could to call, that opportunities

Julien Mininberg

Yes. but that way. look there it we In don’t are, theory, frankly, at

We a principled, in ethical industry. competitor highly tougher are and the

we consumers, to these But did We are The like we And expect by when retailers they everybody by institutions by respected the for EPA them they as wanted for them made well. looked rules. enforce at has frankly, just this rules. play to us. and

opportunity, what to are In we that of pretty if and One some some were of the the way. case changes of creates it of participate, happy disrespect our to for am thing. no fairly strong not with will then our minor do to statements EPA them competitors, make the us, sure any that I are means business, right at the but it we looking

We serves a are looking ethical that industry consumers. principled at

it. opportunity, take our it be We consumers even if the are creates prefer handed expecting we the to situations should where products it consistent. and regulators And gives us will and

Steve Marotta

it will take Very Thanks. down from helpful. you. I offline. Thank

Julien Mininberg

any bet. Are there You questions? more

Operator

no questions, if you final any have comments. more are There

Julien Mininberg

our up. to I We you and many Troy. Well, the very of the progress when further you early later sharing for over the days or weeks interest also today and results, in to quarter for forward wanted third joining Helen speaking with And today which well. we be to just be coming us will a coming look in everyone continued January. report in either of will quick as we thank wrap much

Wall know raise a running at hope put And Troy. and time, our what I growth we and we to we also and despite very beat side of proud our be are just to year are up against I the Street you, guidance lot We expectations able to on on positive So, want another say on trends. some our and Helen going to like will be high base. the thank

plans, today. our attending and thank that’s much you So for very we

Operator

Thank This conference. you. does today’s conclude

disconnect wonderful may You lines time, and day. this a at your have

Helen of Troy (HELE) 7 Oct 212022 Q2 Earnings call transcript