US' Edgewell Q1 FY25 sales drop 2.1% YoY to $478.4 mn, organic 1.3%

The gross profit stood at $191.6 million, as compared to $197.7 million in Q1 of the prior fiscal. The gross margin as a per cent of net sales decreased 30 basis points (bps), to 40.1 per cent in the quarter, inclusive of approximately 140 bps of negative foreign currency. The adjusted gross margin, as a per cent of net sales, decreased 60 bps, or increased 80 bps at constant currency, Edgewell said in a press release.

Meanwhile growth in international markets were 2.0 per cent, driven by both price and volume gains, and seen across wet shave and sun and skin care. The organic sales declined in North America by 3.9 per cent, due to declines in wet shave and feminine care.

Selling, general and administrative (SG&A) expense was $102.9 million, or 21.5 per cent of net sales, as compared to $103.3 million, or 21.1 per cent of net sales in the prior fiscal quarter. Adjusted SG&A was 21.2 per cent of net sales, an increase of 20 bps, primarily driven by higher people and consulting expenses and the impact of lower net sales, partially offset by lower incentive compensation expense, lower bad debt and favourable currency impacts.

Adjusted EBITDA was $45.9 million, inclusive of a $11.2 million unfavourable currency impact, compared to $57.2 million in Q1 FY24. GAAP net (loss) earnings were a loss of $2.1 million or $0.04 per diluted share compared to earnings of $4.8 million or $0.09 per diluted share in the same quarter of prior fiscal. Adjusted net earnings were $3.3 million or $0.07 per share, inclusive of a $0.17 unfavourable currency impact, compared to $12.0 million or $0.24 per share in Q1 FY24.

Outlook

For the full fiscal 2025, Edgewell expects organic net sales to grow between 1 to 3 per cent. Foreign currency impact is now expected to reduce reported net sales by 160 bps, a shift from the previously anticipated 70 bps positive impact.

GAAP EPS is revised to a range of $2.54 to $2.74, compared to the prior estimate of $2.59 to $2.79. This includes restructuring and repositioning charges, costs related to sun care reformulation, and other expenses. Adjusted EPS is now expected to be towards the lower end of the $3.15 to $3.35 range, reflecting a higher-than-expected negative foreign currency impact. The revised foreign currency impact is estimated to be $0.36 per share, up from the previous estimate of $0.18 per share.

The adjusted gross margin is now projected to improve by approximately 55 bps, down from the prior estimate of 75 bps. At constant currency, the expected improvement remains at 90 bps. Adjusted operating margin is now expected to increase by 10 bps, lower than the previously anticipated 40 bps, though it is projected to rise by 50 bps at constant currency. Adjusted EBITDA is forecast to be towards the lower end of the $356-$368 million range.

Fibre2Fashion News Desk (SG)