HAIN CELESTIAL GROUP INC (HAIN)

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the Consolidated Financial Statements and the related Notes thereto for the period ended March 31, 2026 contained in this Quarterly Report on Form 10-Q and our Annual Report on Form 10-K for the fiscal year ended June 30, 2025. Forward-looking statements in this Form 10-Q are qualified by the cautionary statement included in this Form 10-Q under the heading “Forward-Looking Statements” in the introduction of this Form 10-Q.

Overview

The Hain Celestial Group, Inc., a Delaware corporation (collectively with its subsidiaries, the “Company,” “Hain Celestial,” “we,” “us” or “our”), was founded in 1993. Hain Celestial is a leading global health and wellness company whose purpose is to inspire healthier living for people, communities and the planet through better-for-you brands. For more than 30 years, Hain Celestial has intentionally focused on delivering nutrition and well-being that positively impacts today and tomorrow. Headquartered in Hoboken, N.J., Hain Celestial’s products across beverages, yogurt, baby/kids and meal preparation are marketed and sold in over 70 countries around the world. The Company operates under two reportable segments: North America and International.

The Company’s leading brands include Celestial Seasonings® teas, The Greek Gods® yogurt, Earth's Best® Organic and Ella’s Kitchen® baby and kids foods, Joya® and Natumi® plant-based beverages, Hartley’s® jelly, as well as Cully & Sully®, Yorkshire Provender®, and New Covent Garden® soups, among others.

Strategic Review

We are focused on five actions to win in the marketplace and drive growth: aggressively streamlining our portfolio, accelerating brand renovation and innovation, implementing price increases along with broader revenue growth management, driving productivity and working capital efficiency, and enhancing our digital capabilities, inclusive of ecommerce.

During the fourth quarter of fiscal year 2025, we announced that our Board of Directors was conducting a comprehensive review of the Company’s portfolio with the assistance of our independent financial advisor.

As part of this review, on February 27, 2026, we completed the sale (the “Transaction”) of our North American Snacks business, including Garden Veggie Snacks™, Terra® chips and Garden of Eatin’® snacks as well as certain private label products (the “North American Snacks Business”) and received $111.2 million in cash, reflecting the total purchase price of $115.0 million less the holdback of an estimate for a customary inventory adjustment, which is subject to finalization following the closing. We used the net proceeds of $101.1 million from the Transaction to pay down debt. The Transaction represents an important first step in our broader strategic review, as it reduced leverage while enabling us to focus on a more concentrated portfolio of core assets to drive growth.

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Restructuring Program

During the first quarter of fiscal year 2024, the Company began a multi‑year restructuring program (the “Restructuring Program”), to improve profitability and support future growth and incurred charges related to contract terminations, asset write‑downs, employee‑related costs, and other transformation-related expenses.

Cumulative pretax charges associated with the Restructuring Program are expected to be $115 million - $125 million which represents an increase of $15 million from the previously reported range, primarily due to incremental restructuring actions expected to be incurred in connection with the sale of the North American Snacks Business. The Restructuring Program is expected to conclude by fiscal year 2027. For the three and nine months ended March 31, 2026, we incurred pretax charges of $4.8 million and $22.1 million respectively, associated with the Restructuring Program, compared to approximately $7.7 million and $20.4 million respectively, in the corresponding periods of the prior year.

Annualized pretax savings are expected to be $130 million - $150 million. The gross savings to date reflect operating model savings, productivity delivery and benefits from revenue growth management initiatives, offset by volume deleveraging and input cost inflation.

Global Economic Environment

Inflation volatility, changes in interest rates, evolving fiscal and monetary policies, global supply chain constraints, and changes in U.S. and international trade restrictions and tariffs continue to create economic uncertainty and cost pressures across global markets.

Geopolitical tensions, including the conflict in Iran that began in February 2026, have disrupted and could continue to disrupt global energy supply‑demand dynamics, contributing to commodity price volatility and broader uncertainty. These conditions could adversely affect energy prices, transportation routes, logistics and insurance costs, global supply chains, input costs, and consumer spending patterns, which could impact our operating results, liquidity, and cash flows if such conditions persist or escalate. We continue to monitor the evolving macroeconomic and geopolitical environment and assess potential impacts on our business.

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Comparison of Three Months Ended March 31, 2026 to Three Months Ended March 31, 2025

Consolidated Results

The following table compares our results of operations, including as a percentage of net sales, on a consolidated basis, for the three months ended March 31, 2026 and 2025 (dollars in thousands, other than per share amounts and percentages, which may not add due to rounding):

* Percentage is not meaningful due to one or more numbers being negative.

** Percentage is not meaningful due to significantly lower number or nil value in the comparative period.

Net Sales

Net sales for the three months ended March 31, 2026 were $338.4 million, a decrease of $52.0 million, or 13.3%, including a reduction of $48.3 million, or 10.8%, related to divestitures, held for sale businesses, discontinued brands and exited product categories primarily due to sale of the North American Snacks Business and a favorable impact of $12.5 million, or 3.2%, from foreign exchange, as compared to the prior year quarter. Organic net sales, defined as net sales adjusted to exclude the impact of foreign exchange, acquisitions, divestitures, held for sale businesses, discontinued brands and exited product categories, decreased $16.2 million, or 5.7%, from the prior year quarter. The decrease in organic net sales was due to a decline in both the North America and International reportable segments.

Additionally, the decrease in organic net sales comprised a 10.6% decrease in volume/mix, partially offset by a 4.9% increase in pricing primarily reflecting promotional activity. Further details of changes in net sales by segment are provided below in the Segment Results section.

Gross Profit

Gross profit for the three months ended March 31, 2026 was $70.4 million, a decrease of $14.3 million, or 16.8%, as compared to the prior year period. Gross profit margin of 20.8% for the three months ended March 31, 2026 was lower when compared with 21.7% in the prior year period, representing a 90-basis point decrease.

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The decrease in gross profit was driven by both the North America and International reportable segments. The decrease in the North America reportable segment was mainly due to lower sales volume, partially offset by favorable pricing. The decline in the International reportable segment was mainly driven by lower sales volume, partially offset by productivity savings.

Selling, General and Administrative Expenses

Selling, general and administrative expenses were $59.1 million for the three months ended March 31, 2026, a decrease of $3.9 million, or 6.1%, from $62.9 million for the prior year quarter. The decrease was primarily driven by a reduction in employee-related expenses.

Goodwill Impairment

During the three months ended March 31, 2026, the Company recognized a non-cash goodwill impairment charge of $31.0 million related to its U.K. reporting unit. During the three months ended March 31, 2025, the Company recorded aggregate non-cash goodwill impairment charges of $110.3 million within the North America segment related to its U.S. and Canada reporting units. See Note 9, Goodwill and Intangible Assets, and Note 14, Fair Value Measurements, in the Notes to Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q.

Long-Lived Asset and Intangibles Impairment

During the three months ended March 31, 2026, the Company recorded non-cash impairment charges of $12.4 million, primarily related to a reduction in the estimated fair value of the personal care assets held for sale. See Note 4, Assets and Liabilities Held for Sale, in the Notes of the Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q. During the three months ended March 31, 2026, the Company also recognized aggregate non-cash impairment charges of $2.0 million primarily related to Earth’s Best® Organic indefinite-lived tradename. See Note 9, Goodwill and Other Intangible Assets, in the Notes to Consolidated Financial Statements included in Part I, Item 1 of this

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Management’s Discussion and Analysis of Financial Condition and Results of Operations (this “MD&A”) should be read in conjunction with Item 1A and the Consolidated Financial Statements and the related notes thereto for the period ended June 30, 2025 included in Item 8 of this Form 10-K. Forward-looking statements in this Form 10-K are qualified by the cautionary statement included under the heading, “Forward-Looking Statements” at the beginning of this Form 10-K.

This MD&A generally discusses fiscal 2025 and fiscal 2024 items and year-to-year comparisons between fiscal 2025 and fiscal 2024. Discussions of fiscal 2023 items and year-to-year comparisons between fiscal 2024 and fiscal 2023 that are not included in this Form 10-K can be found in “Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2024, which was filed with the SEC on August 27, 2024 and is available on the SEC’s website at www.sec.gov.

Overview

The Hain Celestial Group, Inc., a Delaware corporation (collectively with its subsidiaries, the “Company,” “Hain Celestial,” “we,” “us” or “our”) is a leading global health and wellness company whose purpose is to inspire healthier living for people, communities and the planet through better-for-you brands. For more than 30 years, Hain Celestial has intentionally focused on delivering nutrition and well-being that positively impacts today and tomorrow. Headquartered in Hoboken, N.J., Hain Celestial’s products across snacks, baby/kids, beverages and meal preparation are marketed and sold in over 70 countries around the world. The Company operates under two reportable segments: North America and International.

The Company’s leading brands include Garden Veggie Snacks™, Terra® chips, Garden of Eatin’® snacks, Hartley’s® jelly, Earth’s Best® Organic and Ella’s Kitchen® baby and kid’s foods, Celestial Seasonings® teas, Joya® and Natumi® plant-based beverages, The Greek Gods® yogurt, Cully & Sully®, Yorkshire Provender®, New Covent Garden® and Imagine® soups, among others.

Strategic Review

We are focused on five actions to win in the marketplace and drive growth: aggressively streamlining our portfolio, accelerating brand renovation and innovation, implementing price increases along with broader revenue growth management, driving productivity and working capital efficiency, and enhancing our digital capabilities, inclusive of ecommerce.

During the fourth quarter of fiscal year 2025, we announced that our Board of Directors was conducting a comprehensive review of the Company’s portfolio with the assistance of our independent financial advisor. The Board is considering a broad range of strategic options to enhance value. Also, in the third quarter of fiscal year 2025, we announced that we were exploring strategic alternatives regarding our personal care business to focus on our portfolio of better-for-you food and beverages.

Restructuring Program

During the first quarter of fiscal year 2024, we initiated a multi-year growth, transformation and restructuring program (the “Restructuring Program”) intended to drive shareholder returns. The savings initiatives impact our reportable segments and Corporate and Other. The program is intended to optimize our portfolio, improve underlying profitability and increase our flexibility to invest in targeted growth initiatives, brand building and other capabilities critical to delivering future growth.

Implementation of the Restructuring Program is expected to be completed by the end of the 2027 fiscal year. Cumulative pretax charges associated with the Restructuring Program are expected to be $100 million - $110 million comprised of contract termination costs, asset write-downs, employee-related costs and other transformation-related expenses, which represents an increase of $10 million from the previously reported range. For the fiscal years ended June 30, 2025 and June 30, 2024, we incurred pretax charges of $26 million and $60 million, respectively, associated with the Restructuring Program.

As part of the Restructuring Program, the Company completed the sale of three non-core brands and our investment in a joint venture during fiscal 2024 and fiscal 2025. We also announced the exit of the Yves Veggie Cuisine® plant-based business in Canada, which is expected to be completed in the second quarter of fiscal 2026. We initiated actions to consolidate our personal care manufacturing footprint and exit our non-strategic joint venture in India, which were substantially completed in the first quarter of fiscal 2025. The Company also initiated actions to: (i) simplify its distribution footprint in the U.S.; (ii) rationalize certain product categories for greater capacity utilization, cost reduction and margin expansion; and (iii) reduce office space. Annualized pretax savings are expected to be $130 million - $150 million. The gross savings to date reflect operating model savings, productivity delivery and benefits from revenue growth management initiatives, offset by volume deleveraging and input cost inflation.

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CEO Succession

On May 7, 2025, the Company announced that Ms. Davidson departed as President and Chief Executive Officer and as a member of the Board effective May 6, 2025. The Hain Board is executing its leadership succession plan to identify the Company’s next CEO. The Board has a transition plan in place and has appointed Alison E. Lewis, a member of the Board since September 2024, as Interim President and CEO.

Global Economic Environment

The duration and intensity of inflation fluctuations, alterations in consumer shopping and consumption patterns, and shifts in geopolitical events, such as the ongoing Russia-Ukraine conflict, have led and may continue to lead to increased supply chain expenses and other business impacts. Moreover, our industry has experienced and is anticipating the possibility of further increased supply chain challenges, input cost increases and consumer and economic uncertainty as a result of U.S. government tariffs and the imposition of any counter-tariffs. We continually assess the nature and extent of these potential and evolving impacts on our business, consolidated operational results, liquidity, and capital resources.

Results of Operations

Comparison of Fiscal Year Ended June 30, 2025 to Fiscal Year Ended June 30, 2024

Consolidated Results

The following table compares our results of operations, including as a percentage of net sales, on a consolidated basis, for the fiscal years ended June 30, 2025 and 2024 (dollars in thousands, other than per share amounts and percentages, which may not add due to rounding):

* Percentage is not meaningful due to one or more amounts being negative.

** Percentage is not meaningful due to significantly lower number or nil value in the comparative period.

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Net Sales

Net sales in fiscal 2025 were $1.56 billion, a decrease of $176.5 million, or 10.2%, from net sales of $1.74 billion in fiscal 2024. Results for fiscal 2025 included an unfavorable impact of $87.1 million, or 4.4%, related to divestitures, held for sale businesses, discontinued brands and exited product categories and a favorable impact of $11.6 million, or 0.7%, from foreign exchange, as compared to the prior year. Organic net sales, defined as net sales adjusted to exclude the impact of acquisitions, divestitures, held for sale businesses, discontinued brands, exited product categories and foreign exchange, decreased $101.0 million, or 6.5%, from the prior year. The decrease in each of net sales and organic net sales was primarily due to declines in both the North America and International reportable segments. Additionally, the decrease in organic net sales was comprised of a 4.9% decrease in volume/mix and a 1.6% decrease in price. Further details of changes in net sales by segment are provided below in the Segment Results section.

Gross Profit

Gross profit in fiscal 2025 was $334.1 million, a decrease of $46.8 million, or 12.3%, from $380.8 million in fiscal 2024. Gross profit margin was 21.4% of net sales, compared to 21.9% in the prior year. The decrease in gross profit was driven primarily by the North America reportable segment, mainly due to volume and mix softness along with higher trade spend and inflation, partially offset by productivity improvements. Gross profit also decreased in the International reportable segment mainly due to inflation and volume and mix softness, partially offset by productivity and pricing.

Selling, General and Administrative Expenses

Selling, general and administrative expenses were $271.8 million in fiscal 2025, a decrease of $18.3 million, or 6.3%, from $290.1 million in fiscal 2024. The decrease was primarily due to lower broker expenses, employee-related expenses and professional fees.

Goodwill Impairment

As a result of a significant reduction in actual and projected performance and cash flows, as well as the continued decline in the Company’s market capitalization in fiscal 2025, the Company completed quantitative impairment tests for goodwill ascribed to all its reporting units at various times throughout fiscal 2025. Consequently, the Company recorded aggregate non-

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