The Pure Protein Corporation, which, according to a press release, includes the FreeBird and Empire Kosher businesses, will be sold to Aterian Investment Partners III, LP for $80 million, subject to adjustments. The transaction is expected to close before June 30, 2019, the end of Hain’s fiscal year.
Mark Schiller, president and CEO of Hain, said in the release: “This divestiture is another step forward in simplifying our organization aligned with our transformational strategic plan as we aggressively pursue margin-enhancing initiatives to fuel long-term sustainable growth and profitability. We expect the sale to also help improve our balance sheet as we generate cash from the sale with which we plan to use in part to pay down debt.”
Speaking of their transformational strategic plan, the summary of results, presented in another press release, show a year-over-year slowdown, but an improvement over the second quarter. Take, for instance, the operating income: At $23.9 million, it’s a year-over-year decrease from $29.3 million, but a vast improvement from the second quarter’s operating loss of $15.4 million.
Other highlights include:
- Net sales decreased y-o-y 5% to $599.8 million
- Gross margin of 20.9%, a 10 basis point decrease y-o-y and a 130 basis point increase from the second quarter
- Net income of $10.1 million compared to $25.2 million in the third quarter of fiscal 2018 and a net loss of $29.3 million in the second quarter of fiscal 2019
- Earnings per share of $0.10 compared to $0.24 in the prior year period and a loss per diluted share of $0.28 in the second quarter of fiscal 2019
Schiller said in the release, “We are encouraged by our third quarter financial results that demonstrate sequential performance improvements in many key areas of our business, and we are on track to achieve our fiscal year 2019 outlook. Our team is in the early innings of executing on our transformational strategic plan to simplify our portfolio, strengthen our core capabilities, reinvigorate profitable top-line growth, and expand margins and cash flow. We remain committed to delivering consistency in our operational and financial results to drive long-term shareholder value.”