Prestige Consumer Healthcare Inc. · NYSE:PBH
Prestige Consumer Healthcare — Prestige Brands Holdings — Q3 FY2013 Earnings Presentation
25 slides from Prestige Consumer Healthcare's earnings presentation, Feb 7, 2013
Slide 1: Review of Third Quarter F'13 Results
1 28-75-124 196-18-48 Exhibit 99.2 Review of Third Quarter F’13 Results Matthew M. Mannelly, CEO Ronald M. Lombardi, CFO February 7, 2013
Slide 2: Safe Harbor Disclosure
2 This presentation contains certain “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements about the Company’s growth strategies, investments in advertising and promotion, market position, product development, introductions and in
Slide 3: Agenda
3 Q2 FY2013: Performance Highlights Q3 FY2013: Financial Overview Prestige’s Strategy: Delivering Results; Poised for Continued Success 1 2 3 Agenda 3 F
Slide 4: Prestige Brands: Delivering Value Through a Proven Shareholder Value Creation Framework
4 OTC M&A Focus Strong FCF Resulting in Debt Reduction Drive Core OTC Growth A&P Driven Growth for Core OTC Brands Investment in Multi-Year New Product Development Pipeline Select investment in Other Brands High Conversion of EBITDA to Free Cash Flow Free Cash Flow Used for Rapid Debt Pay
Slide 5: Excellent financial performance for the quarter
5 Excellent financial performance for the quarter − Record Q3 consolidated net revenue of $160.2 million, up 50.8% − Adjusted EPS(1) of $0.37, up 48.0% versus prior year corresponding quarter − Record Cash flow from Operations of $40.5 million(5) − Debt paydown of ~$83 million in Q3 − Leverage rat
Slide 6: Strong Core OTC Organic Revenue Growth
6 (1.2%) Timing Impact of Cough/Cold Shipments Note: Excludes acquired GSK brands (1) Q4 FY’12, Q1 FY’13, Q2 FY’13, and Q3 FY’13 prior year comparable quarter includes Blacksmith Brands and Dramamine. Strong Core OTC Organic Revenue Growth (1) PBH Core Cough/Cold Core OTC Non-Cough/Cold Core OTC 1.1
Slide 7: Consumption for Core Cough/Cold Brands Remained Strong
7 Consumption for Prestige’s Core Cough/Cold Brands Remained Strong; Shipments Followed Earlier Sell-in Strategy Source: Latest 12-week IRI multi-outlet retail dollar sales growth for relevant quarter. (1) Core Cough/Cold brands include Chloraseptic, Little Remedies, Luden’s, and Pediacare C/C Net R
Slide 8: Strong Consumption Performance Across the Portfolio
8 Strong Consumption Performance Across the Portfolio Total Prestige(1) Total OTC(1) Core OTC(1) Prestige Categories Prestige Categories Prestige Categories Source: IRI multi-outlet retail dollar sales for the periods ending 12/30/12; Multi-outlet now covers ~87% of ACV (1) Includes acquired GSK bra
Slide 9: Consistent Category Outperformance and Market Share Gains
9 Consistent Category Outperformance and Market Share Gains Category Source: Latest 12-week IRI multi-outlet retail dollar sales growth for relevant quarter. Note: Data reflects retail dollar sales percentage growth versus prior period. (1) Blacksmith Bands added middle of Q3 ’11. (2) Dramamine adde
Slide 10: Case Study: Efferdent Innovation and Retail Support
10 Innovation A&P Retail Strategy Consumption Outperformance FSI Program Year-Round TV Campaign Direct Mail Trial Size Display Units Couponing Share/Volume Gains Outpacing the Category(2) (1) As compared to the leading denture tablet brands (2) IRI multi-outlet for 52-week Period Ending 12/30/12 K
Slide 11: New Products Have Driven Meaningful Incremental Growth
11 March 2012 December 2012 Efferdent Base Business Efferdent Power Clean Crystals +2% +453% +16% Total Efferdent Base Power Crystals New Products Have Driven Meaningful Incremental Growth, Reaching Nearly 15% of Total Efferdent Sales Significant Incremental Growth, Reaching Nearly 15% Total erdent
Slide 12: Gaviscon Continues to Strengthen Prestige's Canadian Business
12 Gaviscon Continues to Strengthen Prestige’s Canadian Business Prestige Canadian business doubled in size with the acquisition of Gaviscon® from GSK Gaviscon is a brand with momentum; impressive growth in Canada over the past few years #1 in its category with the highest growth(1) (1) ACNiel
Slide 13: Comprehensive A&P Campaign to Support Gaviscon Growth
13 Compelling Consumer Messaging Comprehensive 3600 A&P Campaign to Support Sustained Gaviscon® Growth TV Campaign Professional Sampling Digital Strategy Retail Partnerships Physician Endorsement Search Engine Optimization Couponing to Stimulate Trial and Consumption “Brand Power” focused TV comme
Slide 14: Agenda
14 Q3 FY2013: Performance Highlights Q1 FY2013: Financial Overview Prestige’s Strategy: Delivering Results; Poised for Continued Success 1 2 3 Agenda 3 F
Slide 15: Summary Financial Performance
15 Summary Financial Performance Dollar values in millions, except per share data Notes: (1) These non-GAAP financial measures are reconciled to their most closely related GAAP financial measures in our earnings release in the “About Non-GAAP Financial Measures” section. Adjusted EPS is also reconci
Slide 16: Q3 FY'13 Income Statement Summary
16 Q3 FY'13 Q3 FY'12 % Chg Revenue 160.2$ 106.3$ 50.8% Adj. Gross Margin 88.7 55.1 60.9% % Revenue 55.4% 51.9% A&P 23.5 15.3 54.1% % Revenue 14.7% 14.4% G&A 11.4 8.8 29.8% % Revenue 7.1% 8.2% Adjusted EBITDA 53.8$ 31.1$ 73.0% % Margin 33.6% 29.3% D&A 3.4 2.6 31.1% % Revenue 2.1% 2.4% Adj. Operating
Slide 17: YTD FY'13 Income Statement Summary
17 YTD FY'13 YTD FY'12 % Chg Adjusted Net Revenue(1) 469.5$ 307.1$ 52.9% Adj. Gross Margin 265.2 158.9 66.9% % Revenue 56.5% 51.7% A&P 67.4 38.6 74.6% % Revenue 14.3% 12.6% G&A 33.6 26.7 25.8% % Revenue 7.2% 8.7% Adjusted EBITDA 164.2$ 93.6$ 75.4% % Margin 35.0% 30.5% D&A 10.0 7.7 29.5% % Revenue 2.
Slide 18: Q3 FY'13 and YTD Net Income and EPS Reconciliation
18 3 Months Ended 3 Months Ended YTD YTD Q3 FY'13 Q3 FY'12 YTD FY'13 YTD FY'12 Net Income EPS Net Income EPS Net Income EPS Net Income EPS As Reported 12.3$ 0.24$ 9.5$ 0.19$ 46.2$ 0.90$ 37.2$ 0.73$ Adjustments: Gain on Settlement - - - - - - (4.3) (0.08) Legal & Professional Fees - - - - 0.6 0.01 4.
Slide 19: YTD FY'13 Cash Flow from Operations and Debt Profile
19 Q3 FY'13 Q3 FY'12 YTD FY'13 YTD FY'12 Net Income - As Reported 12.3$ 9.5$ 46.2$ 37.2$ Depreciation & Amortization 3.4 2.6 10.0 7.7 Other Non-Cash Operating Items 13.8 2.5 32.1 11.2 Working Capital 11.1 (0.1) 12.7 (8.1) Cash Flow from Operations 40.5$ 14.5$ 100.9$ 48.0$ YTD FY’13 Cash Flow from Op
Slide 20: Agenda
20 Q3 FY2013: Performance Highlights Q3 FY2013: Financial Overview Prestige’s Strategy: Delivering Results; Poised for Success 1 2 3 Agenda ’ lt ; r Continued Success
Slide 21: What Sets Prestige Apart: Delivering Value Now and Into the Future
21 What Sets Prestige Apart: Delivering Value Now and Into the Future #1 and #2 brands deliver nearly two-thirds of OTC revenue Core OTC brands generating superior growth and market share gains Scale platforms in highly relevant OTC categories Leading margins and strong cash flow generation
Slide 22: Recent Seasonal Flu Incidence Levels Result in Cautious Optimism
22 Recent Seasonal Flu Incidence Levels Result in Cautious Optimism for Remainder of FY2013 2012/2013 3-Year Average Source: IMS Health Inc. FAN National Overview for the week ending January 26, 2013 Note: Growth measured as average weekly affected population for 2012/2013 vs. average weekly affecte
Slide 23: EPS Guidance Revised Upwards
23 EPS Guidance Revised Upwards − Deliver FY’13 Adjusted EPS guidance of $1.45 - $1.48 up from prior guidance of $1.37 - $1.42 • Includes ($0.01) per share associated with divestiture of Phazyme • Includes $0.01 per share estimated benefit from lower interest cost associated with anticipated refin
Slide 24: Q3 FY2013: Delivering Against Stated Strategy
24 Core OTC organic net revenue growth of 4.8% in Q2/Q3 Core OTC consumption growth of 6.9% in L-12 weeks compared to category of 3.2%(1) Q3 Core OTC A&P of 18.5% of net revenue Cash flow from operations of $40.5 million On track with >$120 million target for full year Leverage ratio(2)
Slide 25: 28-75-124 196-18-48 February 7, 2013
25 28-75-124 196-18-48 February 7, 2013
Prestige Brands Holdings — Q3 FY2013 Earnings Presentation on 6ix