Prestige Consumer Healthcare Inc. · NYSE:PBH

Prestige Consumer Healthcare — Prestige Brands Holdings — Q3 FY2014 Earnings Presentation

28 slides from Prestige Consumer Healthcare's earnings presentation, Feb 6, 2014

  1. Slide 1: Review of Third Quarter F'14 Results

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 1 Review of Third Quarter F’14 Results Matt Mannelly, CEO & President Ron Lombardi, CFO February 6, 2014 Exhibit 99.2

  2. Slide 2: Safe Harbor Disclosure

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 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 marketing,

  3. Slide 3: Agenda for Today's Discussion

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 3 1. Perspective on Current Environment 2. Q3 FY2014: Performance Highlights 3. Q3 FY2014: Financial Overview 4. FY2014 Outlook and The Road Ahead Agenda for Today’s Discussion

  4. Slide 4: Perspective on Current Environment

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 4 Perspective on Current Environment

  5. Slide 5: Current Environment

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 5 Current Environment  Anticipated near-term transitional marketplace…combination of factors resulted in significant impact − Soft retail foot traffic has led to significant retail inventory reductions − Returning competitive

  6. Slide 6: Three Primary Environmental Factors Are Impacting Current and Near-Term Performance

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 6 Three Primary Environmental Factors Are Impacting Current and Near-Term Performance Retailer Dynamics Pediatric Product Returns Cough/Cold & Other Category Dynamics(2) “We continue to see a cautious consumer. We did see some

  7. Slide 7: Q3 FY2014: Performance Highlights

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 7 Q3 FY2014: Performance Highlights

  8. Slide 8: Third Quarter Performance Highlights

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 8 Third Quarter Performance Highlights  Q3 Performance Highlights − Strong Free Cash Flow of $41.2(1) million, up 11.8% versus the prior year − Q3 consolidated net revenue of $146.2 million was down 8.7% versus the prior year

  9. Slide 9: Q3 Results Impacted by Combination of Events

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 9 Q3 Results Impacted by Combination of Events Sources of Y/Y Net Revenue Decline Retail Inventory Reductions Competitive Product Returns Other Cough/Cold & GI Category Dynamics  Greater than anticipated trade inventory reduc

  10. Slide 10: Impact of Retail Inventory Reductions Concentrated in the Mass Channel

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 1 0 Impact of Retail Inventory Reductions Concentrated in the Mass Channel Consolidated Total Revenue Growth Note: Represents year-over-year Revenue growth. (1) These Non-GAAP financial measures are reconciled to their most cl

  11. Slide 11: Core OTC Consumption Growth Outpacing Reported Revenue Growth

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 1 1 Core OTC Consumption Growth Outpacing Reported Revenue Growth Due to Retailer Dynamics Source: Latest 12-week IRI multi-outlet retail dollar sales growth for relevant quarter. Note: Data reflects retail dollar sales percen

  12. Slide 12: "It's A Marathon Not A Sprint": Long-Term Brand Building Strategies

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 1 2 “It’s A Marathon Not A Sprint”, Maintain Emphasis on Appropriate Long-Term Brand Building Strategies Sustained Long-Term Growth & Share Gains Innovative New Products Increased Marketing Support and Effectiveness Increased

  13. Slide 13: Transitional Market: Remain Focused on Drivers of Growth Over Time

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 1 3 Transitional Market Remain Focused on Drivers of Growth Over Time Core OTC Consumption Growth Source: Latest 12-week IRI multi-outlet retail dollar sales growth for relevant quarter. Note: Data reflects retail dollar sales

  14. Slide 14: Introducing New Fresh Guard by Efferdent

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 1 4  Gain Professional Endorsement Introducing New Fresh Guard by Efferdent New Fresh Guard Addresses Unmet Consumer Needs  Kills 99.9% of odor causing bacteria  Specially formulated for removable dental appliances  Preven

  15. Slide 15: Continue to Invest Appropriately Behind Brand Building

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 1 5 Continue to Invest Appropriately Behind Brand Building to Support Long-Term Growth (1) (1) Adjusted in FY’11 to reflect normalized level of A&P spending for PediaCare. A&P % of Net Revenue

  16. Slide 16: Oh Canada! Growing Share & Expanding the Reach

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 1 6 Oh Canada! Growing Share & Expanding the Reach 10 Core Brands with Leading Positions Other(1) #2 #1 #1 #1 #1 #1 Supported by Focused Marketing for All Core OTC Brands Goal: Outperform category growth & introduce selected U

  17. Slide 17: Q3 FY2014: Financial Overview

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 1 7 Q3 FY2014: Financial Overview

  18. Slide 18: Summary Financial Performance

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 1 8 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 th

  19. Slide 19: Q3 Consolidated Financial Summary

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 1 9 Q3 FY'14 Q3 FY'13 % Chg Net Revenue 146.2$ 160.2$ (8.7%) Adj. Gross Margin(1) 81.8 88.7 (7.8%) % Margin 56.0% 55.4% A&P 25.6 23.5 8.6% % Net Revenue 17.5% 14.7% G&A 12.1 11.4 6.7% % Net Revenue 8.3% 7.1% Adjusted EBITDA(1)

  20. Slide 20: YTD Consolidated Financial Summary

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 2 0  Adjusted Net Revenue declined 2.5% over the prior year  Adjusted gross margin expanded by 0.5 pts. to 57.0%  A&P spend increased by 1.1 pts. to 15.5% of Adjusted Net Revenue  Adjusted G&A as a percentage of Adjusted N

  21. Slide 21: Net Income and E.P.S. Reconciliation

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 2 1 3 Months Ended 3 Months Ended 9 Months Ended 9 Months Ended Q3 FY'14 Q3 FY'13 Q3 FY'14 Q3 FY'13 Net Income EPS Net Income EPS Net Income EPS Net Income EPS As Reported 3.1$ 0.06$ 12.3$ 0.24$ 56.6$ 1.08$ 46.2$ 0.90$ Adjustm

  22. Slide 22: Strong Free Cash Flow

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 2 2 Q3 FY'14 Q3 FY'13 YTD FY'14 YTD FY'13 Net Income - As Reported 3.1$ 12.3$ 56.6$ 46.2$ Depreciation & Amortization 3.6 3.4 10.2 10.0 Other Non-Cash Operating Items 15.8 13.8 25.4 32.1 Working Capital 2.7 11.1 (11.4) 12.7 Pr

  23. Slide 23: Prestige Continues to Have Leading Free Cash Flow Conversion

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 2 3 Prestige Continues to Have Leading Free Cash Flow Conversion Median: 107% Source: Capital IQ Notes: For the latest twelve month period. Free Cash Flow Conversion is a non GAAP financial measure and is defined as Non-GAAP O

  24. Slide 24: Leading Free Cash Flow Yield Supports Attractive Valuation

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 2 4 Leading Free Cash Flow Yield Supports Attractive Valuation Source: Capital IQ Note: For the latest twelve month period. Free Cash Flow Yield is a non GAAP financial measure and is defined as Cash Provided by Operating Acti

  25. Slide 25: FY2014 Outlook and Road Ahead

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 2 5 FY2014 Outlook and Road Ahead

  26. Slide 26: Outlook for Q4 FY2014 and Beyond

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 2 6 Q4 Considerations: Remain Cautious  Potential for continued soft retail and foot traffic and retailer inventory reductions  Seasonal cough/cold incidences remain well below prior year  Expect returning competitive brand

  27. Slide 27: Our Corporate Mission

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 2 7 Our Corporate Mission To be the Best Mid-Sized, Public Company in the Consumer Health Care Market The following principles guide us in this endeavor:  deliver outstanding shareholder value through superior growth in sales

  28. Slide 28: P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 2 8

    P R E S T I G E B R A N D S T h i r d Q u a r t e r F ’ 1 4 R e s u l t s 2 8

Prestige Brands Holdings — Q3 FY2014 Earnings Presentation on 6ix