Edgewell Reports Q3 Performance

Edgewell Personal Care Company has announced results for its third fiscal quarter ending June 30, 2019. 

Net sales were $609.2 million in the quarter, a decrease of 1.8%, as compared to the prior year period.  Excluding a $9.5 million negative impact from currency translation, organic net sales decreased 0.3%, driven by declines in wet shave and feminine care businesses, partly offset by increased organic sales in the sun and skin care business. Organic net sales declined in North America by 2.7% while International organic net sales grew 4.2%. Lower sales in North America were driven by declines in wet shave, due to distribution losses, lower pricing and an unfavorable comparison to the prior year launch of Intuition f.a.b., partly offset by growth in sun and skin care. Sun and skin care growth reflected favorable timing of promotions and returns and the benefit from the shift in timing of the Easter holiday, offset by lower volumes, which were impacted by lower consumption rates, due to unfavorable weather across most markets. In international markets, organic sales increased in wet shave, benefiting from a favorable comparison to prior year sales in Japan, and in sun and skin care, driven by strong Bulldog sales.

“Our results in the quarter reflect the steps we have been taking to fundamentally improve the commercial and operational performance of our business.  We delivered improved top-line results that were in-line with expectations and are positioning us to achieve our longer-term financial objectives,” said Rod Little, Edgewell's president and CEO. “As we look ahead, we continue to reshape how we operate the business through Project Fuel, which has generated over $100 million in gross savings to date and is serving as a catalyst for reinvestment.  We are making progress on our core business initiatives, beginning the repositioning of our femininecCare business, and building significant momentum in the integration planning for the Harry's transaction.  We are confident that Edgewell is taking the right steps to generate sustainable shareholder value creation.”

The acquisition of men’s razor and grooming brand Harry's Inc., which was announced in May, represents “a pivotal step forward in Edgewell's portfolio transformation, combining Harry's best-in-class brand building, design and direct-to-consumer (DTC) expertise with Edgewell's best-in-class product technology in shaving, personal care and sun care, global scale and iconic consumer brands,” the company penned it its financial release. 

The Harry's transaction is expected to close no later than the first quarter of calendar 2020, according to Edgewell.

“We are excited about the future of Edgewell with Harry's,” said Little. “The two leadership teams have made great progress in the integration planning process. The more we have learned about each other, the more confident we are about the power of this combination and our ability to create new avenues for growth, and ultimately deliver superior returns for investors.”
Edgewell said following a strategic review, it has elected to retain its feminine care business, but said it continues to explore strategic alternatives for the infant care business.