Core business net sales decreased 10% Y/Y and 9.6% compared to Q3 FY21.
The company attributed the sale decline primarily to a decrease from Organic business of $115.6 million, or 18.5%, reflecting lower consumer demand and shifts in consumer spending patterns.
Total net sales revenue for the Home & Outdoor segment fell 7% Y/Y, Health & Wellness decreased 11.5%, and Beauty declined 14.7%.
Adjusted EPS of $2.75 beat the analyst consensus of $2.61.
Gross profit margin increased 210 basis points to 45.9%. The operating margin contracted 60 basis points to 13.8%, and operating income for the quarter declined to $77.2 million.
The company held $45.3 million in cash and equivalents as of November 30, 2022. Net cash provided by operating activities for the nine months was $49.5 million. Inventory was $536.8 million versus $585.8 million in Q3 2022.
Adjusted EBITDA fell 10.8% Y/Y to $99.7 million.
Restructuring Plan: The company announced three major changes to the structure of its organization.
The company is combining the Beauty and Health & Wellness businesses into a single reportable segment, “Beauty & Wellness.”
It is creating a North America Regional Market Organization responsible for sales and go to market strategies for all categories and channels in the U.S. and Canada.
The third is the further centralization of certain functions under shared services, especially in Operations and Finance. The new structure will reduce the size of the global workforce by approximately 10%.
Outlook: Helen Of Troy tightened FY23 sales outlook to $2.025 billion – $2.05 billion from $2.00 billion – $2.05 billion against the consensus of $2.03 billion.
The company narrowed the FY23 adjusted EPS outlook to $9.20 – $9.40 from $9.00 – $9.40 versus the consensus of $9.19.
Price Action: HELE shares closed higher by 3.22% at $116.21 in premarket on the last check Thursday.
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