US natural and organic food producer Hain Celestial has reported lower quarterly net income, despite an 8.3% rise in sales.
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The company posted net income of US$6.18m, or 17 cents per share, for the first quarter to 30 September, compared to $6.54m, or 19 cents per share, for the same quarter of the previous year. Net sales increased to $137.6m from $127.1m a year earlier.
Operating income in the quarter was $10.8m, compared to $11.3m in the prior year’s first quarter, as higher costs of ingredients and freight were not yet offset by the price increase implemented during the quarter.
“We are pleased with the good growth in many of our key brands this quarter. There has been continued broad acceptance of our previously announced price increase. Our tea and snacks brands showed very good growth and our international businesses also performed well,” said president and CEO Irwin Simon.
“We achieved this performance in our business even with a reduction in inventories at two major distributors and increased commodity and freight costs during the quarter. All of our US-based businesses were impacted by the inventory reductions, with sales of our grocery brands most affected,” Simon added.
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By GlobalDataSimon said he was encouraged by the company’s sales activity in October, where there were strong increases over the prior year.
The company reaffirmed its previously announced full-year earnings guidance of $0.92 to $1.01 per share on revenues of $650-670m.
