HAIN CELESTIAL GROUP INC

Previous wording

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.

Current wording

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.

Previous wording

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. For the three months ended September 30, 2025, we incurred pretax charges of $14 million of expenses associated with the Restructuring Program, compared to $5 million in the prior year period.

Current wording

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 six months ended December 31, 2025, we incurred pretax charges of $3.8 million and $17.3 million respectively, associated with the Restructuring Program, compared to approximately $7.3 million and $12.7 million respectively, in the corresponding periods of the prior year.

Previous wording

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 was 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.

Current wording

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.

Previous wording

Inflation volatility, changing consumer behavior, and geopolitical tensions, particularly the Russia-Ukraine conflict, have driven higher supply chain costs and broader business impacts. Tariffs and potential countermeasures further contribute to industry-wide uncertainty. We continually assess the nature and extent of these potential and evolving impacts on our business, consolidated operational results, liquidity, and capital resources.

Current wording

Inflation volatility, shifting consumer behavior, and broader geopolitical tensions have contributed to rising supply chain costs and broader business impacts. Ongoing economic uncertainty, driven by factors such as inflation volatility, evolving fiscal policies, global supply chain constraints, changes in interest rates, and changing U.S. and international trade restrictions and tariffs further heightens industry-wide uncertainty. We continually assess the nature and extent of these potential and evolving impacts on our business, consolidated operational results, liquidity, and capital resources.

Previous wording

Net sales for the three months ended September 30, 2025 were $367.9 million, a decrease of $26.7 million, or 6.8%, including an unfavorable impact of $12.3 million, or 2.7%, related to held for sale businesses, discontinued brands and exited product categories and a favorable impact of $6.6 million, or 1.7%, 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, discontinued brands and exited product categories, decreased $21.0 million, or 5.8%, from the prior year quarter. The decrease in organic net sales comprised of a 7% decrease in volume/mix, partially offset by a 1% increase in price. 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. Further details of changes in net sales by segment are provided below in the Segment Results section.

Current wording

Net sales for the three months ended December 31, 2025 were $384.1 million, a decrease of $27.4 million, or 6.7%, including an unfavorable impact of $10.2 million, or 2.2%, related to held for sale businesses, discontinued brands and exited product categories and a favorable impact of $9.0 million, or 2.2%, from foreign exchange, as compared to the prior year quarter. The decrease in net sales reflected a decline in the North America reportable segment, partially offset by an increase in net sales in the International reportable segment. Organic net sales, defined as net sales adjusted to exclude the impact of foreign exchange, acquisitions, divestitures, discontinued brands and exited product categories, decreased $26.2 million, or 6.7%, from the prior year quarter. The decrease in organic net sales was due to decline in both the North America and International reportable segments. Additionally, the decrease in organic net sales was comprised of a 9.0% decrease in volume/mix, partially offset by a 2.0% increase in price. Further details of changes in net sales by segment are provided below in the Segment Results section.

Previous wording

Gross profit for the three months ended September 30, 2025 was $68.1 million, a decrease of $13.5 million, or 16.6%, as compared to the prior year quarter. Gross profit margin for the three months ended September 30, 2025 was 18.5% compared with 20.7% in the prior year quarter.

Current wording

Gross profit for the three months ended December 31, 2025 was $74.4 million, a decrease of $19.0 million, or 20.3%, as compared to the prior year quarter. Gross profit margin for the three months ended December 31, 2025 was 19.4% compared with 22.7% in the prior year quarter.

Previous wording

Selling, general and administrative expenses were $65.5 million for the three months ended September 30, 2025, a decrease of $5.8 million, or 8.2%, from $71.3 million for the prior year quarter. The decrease was due to lower employee-related and non people cost discipline, as the Company began to implement overhead reduction actions.

Current wording

Selling, general and administrative expenses were $60.9 million for the three months ended December 31, 2025, a decrease of $9.3 million, or 13.2%, from $70.2 million for the prior year quarter. The decrease was primarily due to lower compensation-related expenses and non-employee-related cost discipline, as the Company continued to implement overhead reduction actions.

Previous wording

Productivity and transformation costs were $8.2 million for the three months ended September 30, 2025, an increase of $3.2 million, or 63.8%, from $5.0 million in the prior year quarter. The increase was primarily due to higher costs incurred in connection with the Restructuring Program.

Current wording

Productivity and transformation costs were $5.2 million for the three months ended December 31, 2025, an increase of $1.0 million, or 24.9%, from $4.2 million in the prior year quarter. The increase was primarily due to higher costs incurred in connection with the Restructuring Program.

Previous wording

Amortization of acquired intangibles was $1.2 million for the three months ended September 30, 2025, a decrease of $1.0 million from $2.2 million in the prior year quarter, primarily reflecting reduced amortization expenses due to the impairment of the Personal Care tradenames (Alba Botanica®, Avalon Organics®, and JASON®) and Live Clean® customer relationships recognized in the second quarter of fiscal 2025. See Note 9, Goodwill and Other Intangible Assets, in the Notes to the Consolidated Financial Statements included in Item 8 of the Form 10-K.

Current wording

Amortization of acquired intangibles was $1.2 million for the three months ended December 31, 2025, a decrease of $0.6 million from $1.8 million in the prior year quarter.

Previous wording

Operating loss for the three months ended September 30, 2025 was $6.9 million compared to operating income of $3.1 million in the prior year quarter as a result of the items described above.

Current wording

Operating loss for the three months ended December 31, 2025 was $98.8 million compared to $91.9 million in the prior year quarter as a result of the items described above.

Previous wording

Interest and other financing expense, net totaled $15.5 million for the three months ended September 30, 2025, an increase of $1.8 million, or 12.8%, from $13.7 million in the prior year quarter. The increase resulted primarily due to higher financing fees related to the amendment of our credit agreement. See Note 10, Debt and Borrowings, in the Notes to the Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q.

Current wording

Interest and other financing expense, net totaled $15.7 million for the three months ended December 31, 2025, an increase of $2.9 million, or 22.4%, from $12.8 million in the prior year quarter. The increase resulted primarily from a higher interest rate spread as well as increased amortization of deferred financing fees related to the May 2025 and September 2025 amendments to our Credit Agreement, as defined below. See Note 10, Debt and Borrowings, in the Notes to the Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q.

Previous wording

Loss before income taxes and equity in net loss of our equity-method investees for the three months ended September 30, 2025 was $21.7 million compared to $16.0 million in the prior year quarter. The increase in the loss before income taxes and equity in net loss of our equity-method investees was due to the items discussed above.

Current wording

Loss before income taxes and equity in net loss of our equity-method investees for the three months ended December 31, 2025 was $113.5 million compared to $100.7 million in the prior year quarter. The increase in the loss before income taxes and equity in net loss of our equity-method investees was due to the items discussed above.

Previous wording

The (benefit) provision for income taxes includes federal, foreign, state and local income taxes. Our income tax benefit was $1.3 million for the three months ended September 30, 2025 compared to expense of $3.5 million in the prior year quarter.

Current wording

The provision for income taxes includes federal, foreign, state and local income taxes. Our income tax expense was $2.4 million for the three months ended December 31, 2025 compared to $2.7 million in the prior year quarter.

Previous wording

The effective income tax rate was a benefit of 5.8% and an expense of 22.0% for the three months ended September 30, 2025 and 2024, respectively. The income tax benefit for the three months ended September 30, 2025 reflected foreign tax benefit in certain jurisdictions and an increase in the valuation allowance for both federal and state income taxes. The income tax expense for the three months ended September 30, 2024 reflected foreign tax expense in certain jurisdictions and an increase in the valuation allowance for both federal and state income taxes.

Current wording

The effective income tax rate was an expense of 2.1% and 2.7% for the three months ended December 31, 2025 and 2024, respectively. The income tax expense for the three months ended December 31, 2025 reflected foreign tax expense in certain jurisdictions, recognition of the R&W insurance receivable related to a prior acquisition, impairment of goodwill, and movement in the valuation allowance for both federal and state income taxes. The effective income tax rate for the three months ended December 31, 2024 was impacted by tax expense in certain jurisdictions, impairment of goodwill and personal care intangibles and movement in the valuation allowances for both federal and state income taxes.

Previous wording

Equity in net loss from our equity-method investments for each of the three months ended September 30, 2025 and September 30, 2024 was a loss of $0.2 million.

Current wording

Equity in net loss from our equity-method investments for the three months ended December 31, 2025 was a loss of $0.1 million compared to $0.6 million in the prior year quarter.

Previous wording

Net loss for the three months ended September 30, 2025, was $20.6 million, or $0.23 per diluted share, compared to $19.7 million, or $0.22 per diluted share, in the prior year quarter. The increase in net loss was attributable to the factors noted above.

Current wording

Net loss for the three months ended December 31, 2025 was $116.0 million, or $1.28 per diluted share, compared to $104.0 million, or $1.15 per diluted share, in the prior year quarter. The increase in net loss was attributable to the factors noted above.

Previous wording

Adjusted EBITDA was $19.7 million and $22.4 million for the three months ended September 30, 2025 and 2024, respectively, as a result of the factors discussed above. See Reconciliation of Non-U.S. GAAP Financial Measures to U.S. GAAP Measures following the discussion of our results of operations for definitions and a reconciliation of our net loss to Adjusted EBITDA.

Current wording

Adjusted EBITDA was $24.3 million and $37.9 million for the three months ended December 31, 2025 and 2024, respectively, as a result of the factors discussed above. See Reconciliation of Non-U.S. GAAP Financial Measures to U.S. GAAP Measures following the discussion of our results of operations for definitions and a reconciliation of our net loss to Adjusted EBITDA.

Previous wording

The decrease in net sales primarily reflected lower net sales in the snacks, personal care, and meal preparation categories, partially offset by higher net sales in the beverages category. The decrease in the snacks category was due to velocity challenges and distribution losses. The decline in the meal preparation category was primarily due to the impact of discontinued brands and exited product categories, while the decline in the personal care category was driven by portfolio simplification initiatives and distribution losses.

Current wording

The decrease in net sales was primarily due to lower sales in the snacks, meal preparation, and baby & kids categories, partially offset by growth in the beverages category. The decrease in the snacks category was driven by distribution losses and velocity declines. The decline in the meal preparation category was primarily due to lower volume.

Previous wording

The decrease in gross profit was driven primarily by the International reportable segment, mainly due to lower volume/mix and cost inflation, partially offset by productivity savings and trade efficiencies. This decline was partially offset by an increase in gross profit in the North America reportable segment, mainly driven by higher margin due to productivity savings, pricing and trade efficiencies, partially offset by lower volume/mix and cost inflation.

Current wording

The decrease in gross profit was driven by both the North America and International reportable segments. The decline in the North America reportable segment was due to lower sales volume, partially offset by favorable pricing and trade efficiencies. The International reportable segment had a decrease in gross profit mainly due to cost inflation, partially offset by pricing.

Previous wording

The increase in net sales was primarily due to higher sales in the meal preparation and beverages categories, substantially offset by lower sales in the baby & kids category. The decrease in organic net sales was primarily due to lower sales in the baby & kids category, partially offset by growth in the meal preparation category. The decrease in the baby & kids category was primarily driven by industry-wide volume softness in purees in the U.K.

Current wording

The increase in net sales was primarily due to higher sales in the meal preparation and beverages categories, partially offset by decline in the baby & kids category. The decrease in organic net sales was primarily due to lower sales in the baby & kids and snacks categories, partially offset by growth in the meal preparation category. The decrease in the baby & kids category was primarily driven by industry-wide volume softness in purees in the U.K, while the decline in the snacks category was due to lower volumes.

Previous wording

We finance our operations and growth primarily with the cash flows we generate from our operations and from borrowings available to us under our Credit Agreement (as defined below). We believe that our cash flows from operations and borrowing capacity under our Credit Agreement will be adequate to meet anticipated operating and other expenditures for the foreseeable future. See Note 10, Debt and Borrowings, in the Notes to the Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q.

Current wording

We finance our operations and growth primarily with the cash flows we generate from our operations and from borrowings available to us under our Credit Agreement (as defined below). We believe that our cash flows from operations and borrowing capacity under our Credit Agreement will be adequate to meet anticipated operating and other expenditures. See Note 2, Basis of Presentationand Note 10, Debt and Borrowings, in the Notes to the Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q.

Previous wording

Excluding the impact of hedges, the weighted average interest rate on outstanding borrowings under the Credit Agreement at September 30, 2025 was 7.78%. The Company uses interest rate swaps to hedge a portion of the interest rate risk related to its outstanding variable rate debt. As of September 30, 2025, the notional amount of the interest rate swaps was $400,000 with fixed rate payments of 7.12%. Including the impact of hedges, the weighted average interest rate on outstanding borrowings under the Credit Agreement at September 30, 2025 was 7.31%. Additionally, the Credit Agreement contains a commitment fee of 0.25% per annum on the amount unused under the Credit Agreement.

Current wording

Excluding the impact of hedges, the weighted average interest rate on outstanding borrowings under the Credit Agreement at December 31, 2025 was 8.26%. The Company uses interest rate swaps to hedge a portion of the interest rate risk related to its outstanding variable rate debt. As of December 31, 2025, the notional amount of the interest rate swaps was $400,000 with fixed rate payments of 7.12%. Including the impact of hedges, the weighted average interest rate on outstanding borrowings under the Credit Agreement at December 31, 2025 was 7.71%. Additionally, the Credit Agreement contains a commitment fee of 0.25% per annum on the amount unused under the Credit Agreement.

Previous wording

Our cash and cash equivalents balance decreased by $6.5 million at September 30, 2025 to $47.9 million as compared to $54.4 million at June 30, 2025. Our working capital was $246.2 million at September 30, 2025, a decrease of $6.7 million from $252.9 million at the end of fiscal 2025. Additionally, our total debt increased by $11.4 million at September 30, 2025 to $716.2 million as compared to $704.8 million at June 30, 2025 as a result of an increase in net borrowings during the period.

Current wording

Our cash and cash equivalents balance increased by $13.6 million at December 31, 2025 to $68.0 million as compared to $54.4 million at June 30, 2025. Our working capital was negative $452.1 million at December 31, 2025, a decrease of $705.1 million from $252.9 million at the end of fiscal 2025. The decrease is driven by the classification of $705.8 million of debt obligations, maturing on December 22, 2026, as current. Additionally, our total debt balance, net of unamortized issuance costs, at December 31, 2025 has remained relatively flat as compared to June 30, 2025.

Previous wording

Our cash balances are held in the U.S., U.K., Canada, Western Europe, the Middle East and India. As of September 30, 2025, substantially all cash was held outside the U.S.

Current wording

Our cash balances are held in the U.S., U.K., Canada, Western Europe, the Middle East and India. As of December 31, 2025, substantially all cash was held outside of the U.S.

Previous wording

Cash (Used in) Provided by Operating, Investing and Financing Activities

Current wording

Cash Provided by (Used in) Operating, Investing and Financing Activities

Previous wording

Cash used in operating activities was $8.5 million for the three months ended September 30, 2025, a decrease of $2.3 million from cash used in operating activities of $10.8 million in the prior year period. This decrease in cash used in operating activities versus the prior year period resulted primarily from lower cash utilization of $5.0 million for our working capital accounts which was mainly due to focused inventory management, which generated year-over-year improvement of $13.9 million and resulted in an increased benefit from accounts payable and accrued expenses in the amount of $7.9 million, partially offset by a decrease in accounts receivable recovery of $11.8 million as well as an increase of $2.7 million in net loss adjusted for non-cash charges.

Current wording

Cash provided by operating activities was $28.5 million for the six months ended December 31, 2025, an increase of $8.4 million from cash provided by operating activities of $20.1 million in the prior year period. This increase in cash provided by operating activities versus the prior year period resulted primarily from a reduction of $8.4 million in net loss adjusted for non-cash charges in the six months ended December 31, 2025. Working capital changes, versus the prior year period, resulted in slightly higher cash generation primarily due to focused inventory management, which generated year- over-year improvement of $28.0 million and an increased benefit from accounts payable and accrued expenses in the amount of $18.6 million, offset by a decrease in accounts receivable and other assets recovery of $18.1 million and $28.5 million, respectively. The decrease in other assets primarily reflected the timing difference associated with the January 2026 collection of $25.9 million of insurance proceeds recognized in the first six months of fiscal 2026.

Previous wording

Cash used in investing activities was $5.2 million for the three months ended September 30, 2025, a change of $11.5 million from cash provided by investing activities of $6.3 million in the prior year period. The net change was primarily due to the receipt of proceeds from the sale of ParmCrisps of $12.0 million in the prior year and lower capital expenditures in the three months ended September 30, 2025 due to phasing of capital projects. See Note 5, Disposition, in the Notes to the Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q.

Current wording

Cash used in investing activities was $10.4 million for the six months ended December 31, 2025, a change of $14.6 million from cash provided by investing activities of $4.2 million in the prior year period. The change in cash used by investing activities was primarily due to decrease in proceeds from asset sales of $12.0 million, primarily related to the sale of ParmCrisps®, and the receipt of a $2.6 million dividend from Hutchison Hain Organic Holdings Limited, a joint venture with HUTCHMED (China) Limited, each of which were received in the prior year period.

Previous wording

Cash provided by financing activities was $9.0 million for the three months ended September 30, 2025, a change of $13.2 million compared to cash used in financing activities of $4.2 million in the prior year period. The increase in cash used in financing activities was primarily due to higher net debt borrowings during the three months ended September 30, 2025.

Current wording

Cash used in financing activities was $3.2 million for the six months ended December 31, 2025, a decrease of $13.8 million compared to $17.1 million in the prior year period. The decrease in cash used in financing activities was primarily due to lower net borrowings during the six months ended December 31, 2025.

Previous wording

Our free cash flow was negative $13.7 million for the three months ended September 30, 2025, an improvement of $2.8 million from negative free cash flow of $16.5 million in the three months ended September 30, 2024. The period-over-period change resulted primarily from a decrease in cash flows used in operations of $2.3 million driven by the reasons explained above, and lower capital expenditures of $0.5 million. See Reconciliation of Non-U.S. GAAP Financial Measures to U.S. GAAP Measures following the discussion of our results of operations for definitions and a reconciliation from our net cash used in operating activities to free cash flow.

Current wording

Our free cash flow was $16.3 million for the six months ended December 31, 2025, an increase of $8.3 million from free cash flow of $8.0 million in the six months ended December 31, 2024. The period-over-period change resulted primarily from an increase in cash flows from operations of $8.4 million driven by the reasons explained above, partially offset by slightly higher capital expenditures. See Reconciliation of Non-U.S. GAAP Financial Measures to U.S. GAAP Measures following the discussion of our results of operations for definitions and a reconciliation from our net cash provided by operating activities to free cash flow.

Previous wording

In January 2022, the Company’s Board of Directors authorized the repurchase of up to $200.0 million of the Company’s issued and outstanding common stock. Repurchases may be made from time to time in the open market, pursuant to pre-set trading plans, in private transactions or otherwise. The current 2022 authorization does not have a stated expiration date. The extent to which the Company repurchases its shares and the timing of such repurchases will depend upon market conditions and other corporate considerations. During the three months ended September 30, 2025, the Company did not repurchase any shares under the repurchase program. As of September 30, 2025, the Company had $173.5 million of remaining authorization under the share repurchase program.

Current wording

In January 2022, the Company’s Board of Directors authorized the repurchase of up to $200.0 million of the Company’s issued and outstanding common stock. Repurchases may be made from time to time in the open market, pursuant to pre-set trading plans, in private transactions or otherwise. The current 2022 authorization does not have a stated expiration date. The extent to which the Company repurchases its shares and the timing of such repurchases will depend upon market conditions and other corporate considerations. During the six months ended December 31, 2025, the Company did not repurchase any shares under the repurchase program. As of December 31, 2025, the Company had $173.5 million of remaining authorization under the share repurchase program.

Previous wording

The Company defines Adjusted EBITDA as net loss before net interest expense, income taxes, depreciation and amortization, equity in net loss of equity-method investees, stock-based compensation, net, unrealized currency losses, certain litigation expenses, net, plant closure related costs, net, productivity and transformation costs, costs associated with acquisitions, divestitures and other transactions, (gain) loss on sale of assets, long-lived asset impairment and other adjustments. The Company’s management believes that this presentation provides useful information to management, analysts and investors regarding certain additional financial and business trends relating to its results of operations and financial condition. In addition, management uses this measure for reviewing the financial results of the Company and as a component of performance-based executive compensation. Adjusted EBITDA is a non-U.S. GAAP measure and may not be comparable to similarly titled measures reported by other companies.

Current wording

The Company defines Adjusted EBITDA as net loss before net interest expense, income taxes, depreciation and amortization, equity in net loss of equity-method investees, stock-based compensation, net, unrealized currency losses (gains), proceeds from insurance claim, certain litigation expenses, net, plant closure related costs, net, productivity and transformation costs, costs associated with acquisitions, divestitures and other transactions, (gain) loss on sale of assets, impairment of goodwill, intangibles and long-lived assets and other adjustments. The Company’s management believes that this presentation provides useful information to management, analysts and investors regarding certain additional financial and business trends relating to its results of operations and financial condition. In addition, management uses this measure for reviewing the financial results of the Company and as a component of performance-based executive compensation. Adjusted EBITDA is a non-U.S. GAAP measure and may not be comparable to similarly titled measures reported by other companies.

Previous wording

(a)Expenses and items relating to securities class action and baby food litigation and SEC investigation.

Current wording

Expenses and items relating to securities class action, baby food litigation and SEC investigation.

Previous wording

A reconciliation from cash flows (used in) provided by operating activities to Free Cash Flow is as follows:

Current wording

A reconciliation from cash flows provided by operating activities to Free Cash Flow is as follows:

Previous wording

Our financial statements are prepared in accordance with accounting principles generally accepted in the United States. The accounting principles we use require us to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and amounts of income and expenses during the reporting periods presented. We believe in the quality and reasonableness of our critical accounting policies; however, materially different amounts may be reported under different conditions or using assumptions different from those that we have applied. The accounting policies that have been identified as critical to our business operations and to understanding the results of our operations pertain to variable consideration, valuation of long-lived assets, goodwill and intangible assets, stock-based compensation and valuation allowances for deferred tax assets. The application of each of these critical accounting policies and estimates is discussed in Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, of our Annual Report on Form 10-K for the fiscal year ended June 30, 2025, from which there have been no material changes. We are providing the below update regarding goodwill.

Current wording

Our financial statements are prepared in accordance with accounting principles generally accepted in the United States. The accounting principles we use require us to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and amounts of income and expenses during the reporting periods presented. We believe in the quality and reasonableness of our critical accounting policies; however, materially different amounts may be reported under different conditions or using assumptions different from those that we have applied. The accounting policies that have been identified as critical to our business operations and to understanding the results of our operations pertain to variable consideration, valuation of long-lived assets, goodwill and intangible assets, stock-based compensation and valuation allowances for deferred tax assets. The application of each of these critical accounting policies and estimates is discussed in Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, of our Annual Report on Form 10-K for the fiscal year ended June 30, 2025, from which there have been no material changes. We are providing the below update regarding goodwill and indefinite-lived intangible assets.

Previous wording

As of September 30, 2025, goodwill associated with the U.S. and U.K. reporting units had a carrying value of $312,321 and $114,021, respectively. The goodwill related to the U.S. and U.K. reporting units are at risk of potential impairment if the fair value of these reporting units, and their associated assets, decrease in value due to the amount and timing of expected future cash flows, decreased customer demand for products, an inability to execute management’s business strategies, or general market conditions, such as economic downturns, and changes in interest rates, including discount rates. Future cash flow estimates are, by their nature, subjective, and actual results may differ materially from the Company’s estimates. If the Company’s ongoing cash flow projections are not met or if market factors utilized in the impairment test deteriorate, including an unfavorable change in the terminal growth rate or the weighted-average cost of capital, the Company may have to record additional impairment charges in future periods. We monitor our reporting units at risk of impairment for interim impairment indicators.

Current wording

The goodwill related to the U.S. and U.K. reporting units remains at risk of potential impairment if the fair value of these reporting units, and their associated assets, decrease in value due to the amount and timing of expected future cash flows, decreased customer demand for products, an inability to execute management’s business strategies, or general market conditions, such as economic downturns, and changes in interest rates, including discount rates. Future cash flow estimates are, by their nature, subjective, and actual results may differ materially from the Company’s estimates. If the Company’s ongoing cash flow projections are not met or if market factors utilized in the impairment test deteriorate, including an unfavorable change in the terminal growth rate or the weighted-average cost of capital, the Company may have to record additional impairment charges in future periods. We monitor our reporting units at risk of impairment for interim impairment indicators.

Previous wording

The Sensible Portions® and Spectrum® intangible assets are part of the North America reportable segment and have a remaining aggregate carrying value of $8,000 and $11,800, respectively, as of September 30, 2025. The Spectrum® and Sensible Portions® tradenames remain at risk of impairment in future periods in the event of unfavorable changes in assumptions, including forecasted future cashflows based on execution of strategic initiatives for increasing revenue, as well as discount rates and other macroeconomic factors.

Current wording

The Ella’s Kitchen® baby and kids foods, Hartley’s® jelly, Sensible Portions®, and Spectrum® indefinite-lived tradenames remain at risk of impairment in future periods in the event of unfavorable changes in assumptions, including forecasted future cash flows based on execution of strategic initiatives for increasing revenue, as well as discount rates and other macroeconomic factors. The Sensible Portions® and Spectrum® intangible assets, which were quantitatively tested in the prior year, are part of the North America reportable segment and have remaining carrying value of $8,000 and $11,800, respectively, as of December 31, 2025.

Previous wording

Certain of our product lines have seasonal fluctuations in demand. Hot tea and soup sales are stronger in colder months, while sales of snack foods are stronger in the warmer months. As such, our results of operations and our cash flows for any particular quarter are not indicative of the results we expect for the full year, and our historical seasonality may not be indicative of future quarterly results of operations. Historically, net sales and profitability in the first fiscal quarter have typically been the lowest of our four quarters.

Current wording

Certain of our product lines have seasonal fluctuations. Hot tea and soup sales are stronger in colder months, while sales of snack foods are stronger in the warmer months. As such, our results of operations and our cash flows for any particular quarter are not indicative of the results we expect for the full year, and our historical seasonality may not be indicative of future quarterly results of operations. Historically, net sales and profitability in the first fiscal quarter have typically been the lowest of our four quarters.