Prestige Consumer Healthcare Inc. Reports Record Third Quarter Results and Raises Full-Year Earnings Outlook

• Revenue of $290.3 million in Q3, up 2.7% versus prior year
• Diluted EPS of $1.22 in Q3 increased approximately 15% versus prior year
• Reduced leverage to 2.5x in Q3, driven by strong profitability and cash flow
• Raising full-year fiscal 2025 earnings outlook

"We are pleased with our strong third quarter results that delivered both record quarterly sales and earnings per share. Sales trends benefitted from continued strong International business performance and was further helped by sequentially improved Clear Eyes® revenues. Continued robust free cash flow enabled us to pay off all remaining variable debt, allowing for further capital allocation opportunities to drive shareholder value as we approach fiscal 2026,” said Ron Lombardi, Chief Executive Officer of Prestige Consumer Healthcare.

Third Fiscal Quarter Ended December 31, 2024

Reported revenues in the third quarter of fiscal 2025 of $290.3 million increased 2.7% from $282.7 million in the third quarter of fiscal 2024. The revenue performance versus the prior year comparable period reflected continued strong growth in the International OTC segment, partially offset by declines in the Cough & Cold category. The revenue performance also included sequential sales improvement versus second quarter fiscal 2025 for Clear Eyes.

Reported net income for the third quarter of fiscal 2025 totaled $61.0 million compared to the prior year third quarter of $53.0 million. Diluted earnings per share of $1.22 for the third quarter of fiscal 2025 compared to $1.06 in the prior year comparable period.

Nine Months Ended December 31, 2024

Reported revenues for the first nine months of fiscal 2025 totaled $841.2 million and compared to revenues of $848.4 million for the first nine months of fiscal 2024. Revenues decreased 0.8% versus the prior year comparable period. The revenue performance for the first nine months reflected the anticipated limited ability to supply strong demand for Clear Eyes and declines in the Cough & Cold and Women's Health categories, partially offset by continued strong growth in the Gastrointestinal category and International OTC segment.

Reported net income for the first nine months of fiscal 2025 totaled $164.5 million, or $160.4 million on a non-GAAP adjusted basis, versus the prior year comparable period net income of $159.9 million. Diluted earnings per share and non-GAAP adjusted diluted earnings per share were $3.28 and $3.20, respectively, for the first nine months of fiscal 2025, compared to diluted earnings per share of $3.19 in the prior year comparable period.

The adjustment to the first nine months of fiscal 2025 relates to a discrete tax item in the first quarter pertaining to the release of a reserve for an uncertain tax position due to the statute of limitations expiring.

Free Cash Flow and Balance Sheet

The Company's net cash provided by operating activities for the third quarter of fiscal 2025 was $65.1 million compared to $71.5 million during the prior year comparable period. Non-GAAP free cash flow in the third quarter of fiscal 2025 of $63.5 million decreased compared to $69.5 million in the prior year third quarter. The Company's net cash provided by operating activities for the first nine months of fiscal 2025 was $189.7 million, compared to $182.0 million during the prior year comparable period. Non-GAAP free cash flow in the first nine months of fiscal 2025 was $184.9 million, increasing compared to $175.6 million in the prior year comparable period.

In the first nine months of fiscal 2025, the Company repurchased approximately 0.6 million shares at a total investment of approximately $40.2 million. The Company's net debt position as of December 31, 2024 was approximately $0.9 billion, resulting in a covenant-defined leverage ratio of 2.5x.

Segment Review

North American OTC Healthcare: Segment revenues of $238.9 million for the third quarter fiscal 2025 increased 1.0% compared to the prior year comparable quarter's segment revenues of $236.6 million. The revenue increase reflected strong GI and Dermatologicals category growth, partially offset by declines in the Cough & Cold category.

For the first nine months of the current fiscal year, reported revenues for the North American OTC Healthcare segment were $711.1 million, which compared to $727.1 million in the prior year comparable period. The change was attributable to higher GI category sales offset by lower sales in the Cough & Cold, Women's Health, and Oral Care categories, as well as the limited ability to fully supply demand for Clear Eyes.

International OTC Healthcare: Fiscal third quarter 2025 revenues of $51.4 million increased 11.3% compared to $46.2 million reported in the prior year comparable period, and increased 8.3% excluding the effects of foreign currency. The performance was driven by broad-based growth in Australia revenues led by the Hydralyte® brand.

For the first nine months of the current fiscal year, reported revenues for the International OTC Healthcare segment were $130.2 million, an increase of approximately 7.4% over the prior year comparable period's revenues of $121.2 million, or approximately 6.2% excluding the effects of foreign currency. The revenue growth was led by strong growth for the Hydralyte brand.

Commentary and Updated Outlook for Fiscal 2025

Ron Lombardi, Chief Executive Officer, stated, "We are pleased with third quarter performance that delivered improved revenue trends for Summer's Eve and Clear Eyes, as well as double-digit earnings growth, resulting from the benefits of our strong free cash flow that enabled debt reduction and share repurchases. Looking at the full-year fiscal 2025, our sales performance year-to-date sets us up well to achieve our fiscal 2025 outlook and for approximately 1% organic revenue growth. Regarding profitability, we are raising our earnings outlook thanks to our strong free cash flows that enabled lower interest expense and shares outstanding.”

"Our proven business strategy continues to deliver strong financial performance and leaves us well positioned to deliver additional shareholder value through our anticipated robust long-term free cash flow generation,” Mr. Lombardi concluded.

Fiscal Third Quarter 2025 Conference Call, Accompanying Slide Presentation and Replay

The Company will host a conference call to review its third quarter fiscal 2025 results today, February 6, 2025 at 8:30 a.m. ET. The Company provides a live Internet webcast, a slide presentation to accompany the call, as well as an archived replay, all of which can be accessed from the Investor Relations page of the Company's website at http://www.prestigeconsumerhealthcare.com/. To participate in the conference call via phone, participants may register for the call here to receive dial-in details and a unique pin. While not required, it is recommended to join 10 minutes prior to the event start. The slide presentation can be accessed from the Investor Relations page of the Company's website by clicking on Webcasts and Presentations.

A conference call replay will be available for approximately one week following completion of the live call and can be accessed on the Company's Investor Relations page.

Non-GAAP and Other Financial Information

In addition to financial results reported in accordance with generally accepted accounting principles (GAAP), we have provided certain non-GAAP financial information in this release to aid investors in understanding the Company's performance. Each non-GAAP financial measure is defined and reconciled to its most closely related GAAP financial measure in the "About Non-GAAP Financial Measures” section at the end of this earnings release.

Note Regarding Forward-Looking Statements

This news release contains "forward-looking statements" within the meaning of the federal securities laws that are intended to qualify for the Safe Harbor from liability established by the Private Securities Litigation Reform Act of 1995. "Forward-looking statements" generally can be identified by the use of forward-looking terminology such as "guidance," "outlook," "may," "will," "would," "expect," "anticipate," "positioned,” "further” or "continue" (or the negative or other derivatives of each of these terms) or similar terminology. The "forward-looking statements" include, without limitation, statements regarding the Company's future operating results including revenues, organic growth, adjusted diluted earnings per share, and free cash flow the timing and extent of supply chain challenges, and the Company's ability to maximize shareholder value through its business strategy, generation of free cash flow and capital allocation opportunities. These statements are based on management's estimates and assumptions with respect to future events and financial performance and are believed to be reasonable, though are inherently uncertain and difficult to predict. Actual results could differ materially from those expected as a result of a variety of factors, including the impact of business and economic conditions, including as a result of labor shortages, inflation and geopolitical instability, consumer trends, the impact of the Company's advertising and marketing and new product development initiatives, customer inventory management initiatives, fluctuating foreign exchange rates, evolving U.S. and international tariffs, competitive pressures, and the ability of the Company's manufacturing operations and third party manufacturers and logistics providers and suppliers to meet demand for its products and to avoid inflationary cost increases and disruption as a result of labor shortages. A discussion of other factors that could cause results to vary is included in the Company's Annual Report on Form 10-K for the year ended March 31, 2024 and other periodic reports filed with the Securities and Exchange Commission.

About Prestige Consumer Healthcare Inc.

Prestige Consumer Healthcare is a leading consumer healthcare products company with sales throughout the U.S. and Canada, Australia, and in certain other international markets. The Company's diverse portfolio of brands include Monistat® and Summer's Eve® women's health products, BC® and Goody's® pain relievers, Clear Eyes® and TheraTears® eye care products, DenTek® specialty oral care products, Dramamine® motion sickness treatments, Fleet® enemas and glycerin suppositories, Chloraseptic® and Luden's® sore throat treatments and drops, Compound W® wart treatments, Little Remedies® pediatric over-the-counter products, Boudreaux's Butt Paste® diaper rash ointments, Nix® lice treatment, Debrox® earwax remover, Gaviscon® antacid in Canada, and Hydralyte® rehydration products and the Fess® line of nasal and sinus care products in Australia. Visit the Company's website at www.prestigeconsumerhealthcare.com.