HAIN CELESTIAL GROUP INC

Previous wording

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.

Current wording

As part of this review, on February 27, 2026, the Company completed the sale (the “North American Snacks Transaction”) of its 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 was finalized following the closing. The Company used the net proceeds of $101.1 million from the North American Snacks Transaction to reduce the Company’s indebtedness.

Previous wording

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.

Current wording

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. Cumulative pretax charges associated with the Restructuring Program are expected to be $135.0 million - $145.0 million. The Restructuring Program is expected to conclude by fiscal year 2028. See Note 1, Description of the Business and Basis of Presentation, under the heading “Strategic Review—International Business Transaction” in the Notes to the Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q.

Previous wording

Net sales for the nine months ended March 31, 2026 were $1,090.4 million, a decrease of $106.1 million, or 8.9%, including a reduction of $104.9 million, or 7.9%, related to divestitures, held for sale businesses, discontinued brands and exited product categories and a favorable impact of $28.2 million, or 2.4%, from foreign exchange, as compared to the prior year period. Organic net sales decreased $29.3 million, or 3.4%, from the prior year period. The decrease in net sales was primarily due to a decline in the North America reportable segment. The decrease in organic net sales was due to declines in both the North America and International reportable segments. Additionally, the decrease in organic net sales was comprised of a 6.7% decrease in volume/mix and a 3.3% increase in price. 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 September 30, 2026 were $260.3 million, a decrease of $107.6 million, or 29.3%, including an impact of $88.8 million, or 22.3%, related to held for sale businesses, discontinued brands and exited product categories and a favorable impact of $1.1 million, or 0.3%, 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 $17.8 million, or 6.7%, from the prior year quarter. The decrease in organic net sales was comprised of a 6.9% decrease in volume/mix, partially offset by a 0.6% increase in pricing. The decrease in net sales was primarily due to decline in the North America reportable segment driven by the disposition of the North American Snacks business in the prior fiscal year. The decline in organic net sales was 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.

Previous wording

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.

Current wording

Gross profit for the three months ended September 30, 2026 was $56.7 million, a decrease of $11.4 million, or 16.8%, as compared to the prior year quarter. Gross profit margin for the three months ended September 30, 2026 was 21.8% compared with 18.5% in the prior year quarter. The increase in gross profit margin was primarily due to the North America segment driven by the North American Snacks Transaction, partially offset by lower volume/mix. The decrease in gross profit was driven by both the North America and International reportable segments. The decrease in gross profit for the North America reportable segment was mainly due to lower sales volume, including the impact of the North American Snacks Transaction and cost inflation, partially offset by productivity savings and pricing. The decrease in gross profit for the International reportable segment was driven by lower volume/mix and cost inflation, partially offset by productivity savings.

Previous wording

Productivity and transformation costs were $4.1 million for the three months ended March 31, 2026, a decrease of $3.2 million, or 44.2%, from $7.3 million in the prior year quarter. The decrease primarily reflected a reduction in restructuring costs incurred in connection with the Restructuring Program.

Current wording

Productivity and transformation costs were $4.7 million for the three months ended September 30, 2026, a decrease of $3.6 million, or 43.2%, from $8.2 million in the prior year quarter. The decrease was primarily due to lower costs incurred in connection with the Restructuring Program.

Previous wording

Operating loss for the three months ended March 31, 2026 was $42.1 million compared to operating loss of $121.1 million in the prior year quarter as a result of the items described above.

Current wording

Operating loss for the three months ended September 30, 2026 was $15.0 million compared to $6.9 million in the prior year quarter as a result of the items described above.

Previous wording

Loss before income taxes and equity in net loss of our equity-method investees for the three months ended March 31, 2026 was $105.6 million compared to $134.1 million in the prior year quarter. The decrease 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 September 30, 2026 was $10.4 million compared to $21.7 million in the prior year quarter. The decrease 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 provision (benefit) for income taxes includes federal, foreign, state and local income taxes. Our income tax expense was $0.8 million for the three months ended March 31, 2026 compared to income tax benefit of $0.5 million in the prior year quarter.

Current wording

The provision (benefit) for income taxes includes federal, foreign, state and local income taxes. Our income tax expense was $0.9 million for the three months ended September 30, 2026 compared to a benefit of $1.3 million in the prior year quarter.

Previous wording

The effective income tax rate was an expense of 0.7% and a benefit of 0.4% for the three months ended March 31, 2026 and 2025, respectively. The income tax expense for the three months ended March 31, 2026 reflected foreign tax expense in certain jurisdictions, impairment of goodwill and intangibles, the sale of the North American Snacks Business and movement in the valuation allowance for both federal and state income taxes. The effective income tax rate for the three months ended March 31, 2025 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.

Current wording

The effective income tax rate was an expense of 8.4% and a benefit of 5.8% for the three months ended September 30, 2026 and 2025, respectively. The income tax expense for the three months ended September 30, 2026 reflected foreign tax expense in certain jurisdictions and an increase in the valuation allowance for both federal and state income taxes. 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.

Previous wording

Equity in net loss from our equity-method investments for the three months ended March 31, 2026 decreased by $1.0 million compared to $1.0 in the prior year quarter.

Current wording

Equity in net loss from our equity-method investments for the three months ended September 30, 2026 decreased to nil compared to $0.2 in the prior year quarter.

Previous wording

Net loss for the three months ended March 31, 2026 was $106.3 million, or $1.17 per diluted share, compared to $134.6 million, or $1.49 per diluted share, in the prior year quarter. The decrease in net loss was attributable to the factors noted above.

Current wording

Net loss for the three months ended September 30, 2026, was $11.3 million, or $0.12 per diluted share, compared to $20.6 million, or $0.23 per diluted share, in the prior year quarter. The decrease in net loss was attributable to the factors noted above.

Previous wording

Adjusted EBITDA was $26.3 million and $33.6 million for the three months ended March 31, 2026 and 2025, 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 $17.6 million and $19.7 million for the three months ended September 30, 2026 and 2025, 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 was primarily due to lower sales in the snacks, meal preparation and baby & kids categories. The decrease in organic net sales was primarily due to lower sales in the baby & kids category, partially offset by growth in the beverages category. The decrease in the baby & kids category was driven by volume softness in purees and formula, partially offset by growth in The Greek Gods® yogurt.

Current wording

The decrease in organic net sales was primarily due to lower sales in the baby & kids, beverages, and meal preparation categories. The decrease in the baby & kids and meal preparation categories was driven by volume softness and distribution losses in purees and culinary oils and spreads, respectively. The decline in the beverages category was primarily driven by volume softness.

Previous wording

The increase in net sales was primarily due to higher sales in the meal preparation and beverages categories, partially offset by lower sales in the baby & kids category. The decrease in organic net sales was due to lower sales in all categories, especially in the baby & kids and meal preparation categories. The decrease in the baby & kids category was primarily driven by continued industry-wide volume softness in purees in the U.K. The decrease in the meal preparation category was due to weak soup performance across brands and softness in meat alternatives and private label spreads and drizzles.

Current wording

The decrease in both net sales and organic net sales was primarily driven by lower sale in the meal preparation category, partially offset by growth in the baby & kids and beverages categories. The decrease in the meal preparation category was primarily driven by declines in spreads and drizzles and weak soup performance across brands. The growth in the baby & kids category is primarily driven by snacks on account of effective promotional events, whereas growth in the beverages category is driven by private label non-dairy beverages.

Previous wording

Refer to Note 18, Segment Information, in the Notes to the Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q.

Current wording

The change in Corporate and Other adjusted EBITDA primarily reflected a reduction in compensation-related expenses. Refer to Note 18, Segment Information, in the Notes to the Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q.

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. See Note 2, Basis of Presentation, and 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 through its maturity date. However, the Credit Agreement matures in December 2026, and the Company continues to engage with its lenders regarding its capital structure and continues to evaluate and pursue all available paths. There can be no assurance that these efforts will be successful or completed on acceptable terms, or at all. Any default by us under the credit agreement, including our failure to repay in full the Credit Agreement at or prior to maturity, could have a material adverse effect on our business and financial condition, including being forced to seek relief under federal bankruptcy laws or to pursue a restructuring, wind-down, or liquidation, and holders of our common stock could experience a significant or complete loss of their investment. Please refer to the risk factor “Any default under our credit agreement or inability to refinance our indebtedness could have significant consequences” set forth in Part I, Item 1A, “Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended June 30, 2026, and 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

On December 22, 2021, the Company entered into a Fourth Amended and Restated Credit Agreement (as subsequently amended, the “Credit Agreement”). The Credit Agreement originally provided for senior secured financing of $1,100.0 million in the aggregate, consisting of (1) $300.0 million in aggregate principal amount of term loans (the “Term Loans”) and (2) an $800.0 million senior secured revolving credit facility (which includes borrowing capacity available for letters of credit, and was originally comprised of a $440.0 million U.S. revolving credit facility and $360.0 million global revolving credit facility) (the “Revolver”). Both the Revolver and the Term Loans mature on December 22, 2026. The Company’s obligations under the Credit Agreement are guaranteed by certain existing and future domestic subsidiaries of the Company and are secured by liens on assets of the Company and its material domestic subsidiaries, including the equity interest in each of their direct subsidiaries and intellectual property, subject to agreed-upon exceptions.

Current wording

On December 22, 2021, the Company entered into a Fourth Amended and Restated Credit Agreement (as subsequently amended, the “Credit Agreement”). The Credit Agreement originally provided for senior secured financing of $1,100.0 million in the aggregate, consisting of (1) $300.0 million in aggregate principal amount of term loans (the “Term Loans”) and (2) an $800.0 million senior secured revolving credit facility (which includes borrowing capacity available for letters of credit, and was originally comprised of a $440.0 million U.S. revolving credit facility and $360.0 million global revolving credit facility) (the “Revolver”). Both the Revolver and the Term Loans mature on December 22, 2026. The Company’s obligations under the Credit Agreement are guaranteed by certain existing and future domestic subsidiaries of the Company and are secured by liens on assets of the Company and its material domestic subsidiaries, including the equity interest in each of their direct subsidiaries and intellectual property, subject to agreed-upon exceptions. The Credit Agreement includes financial covenants that require compliance with a consolidated secured leverage ratio, a consolidated leverage ratio and a consolidated interest coverage ratio.

Previous wording

The Credit Agreement includes financial covenants that require compliance with a consolidated secured leverage ratio, a consolidated leverage ratio and a consolidated interest coverage ratio. On August 22, 2023, the Company entered into a Second Amendment (the “Second Amendment”) to the Credit Agreement. Pursuant to the Second Amendment, the Company’s maximum consolidated secured leverage ratio was amended to be 5.00:1.00 until September 30, 2023, 5.25:1.00 until December 31, 2023, 5.00:1.00 until December 31, 2024, and 4.25:1.00 thereafter. See below for a description of the Third Amendment and Fourth Amendment (each as defined below). Following the Fourth Amendment, the Company’s maximum consolidated secured leverage ratio under the Credit Agreement was 5.00:1.00 until June 30, 2025 and is 5.50:1.00 for the quarter ending September 30, 2025 and thereafter. Pursuant to the Credit Agreement, the Company’s maximum consolidated leverage ratio is 6.00:1.00 and, through June 30, 2025, its minimum interest coverage ratio was 2.50:1.00.

Current wording

On August 22, 2023, the Company entered into a Second Amendment (the “Second Amendment”) to the Credit Agreement. Pursuant to the Second Amendment, the Company’s maximum consolidated secured leverage ratio was amended to be 5.00:1.00 until September 30, 2023, 5.25:1.00 until December 31, 2023, 5.00:1.00 until December 31, 2024, and 4.25:1.00 thereafter. The Company’s maximum consolidated leverage ratio remained at 6.00:1.00, and its minimum consolidated interest coverage ratio remained at 2.75:1.00.

Previous wording

On May 5, 2025, the Company entered into a Third Amendment (the “Third Amendment”) to the Credit Agreement. Pursuant to the Third Amendment, the Company’s maximum consolidated secured leverage ratio was amended to be 4.75:1.00 for the quarter ending June 30, 2025 through (and including) the quarter ending March 31, 2026, 4.50:1.00 for the quarter ending June 30, 2026, and 4.25:1.00 for the quarter ending September 30, 2026 and thereafter.

Current wording

On May 5, 2025, the Company entered into a Third Amendment (the “Third Amendment”) to the Credit Agreement. Pursuant to the Third Amendment, the Company’s maximum consolidated secured leverage ratio was amended to be 4.75:1.00 for the quarter ending June 30, 2025 through (and including) the quarter ending March 31, 2026, 4.50:1.00 for the quarter ending June 30, 2026, and 4.25:1.00 for the quarter ending September 30, 2026 and thereafter. The Third Amendment also reduced the size of the Revolver from $800.0 million to $700.0 million in the aggregate, with the U.S. revolving credit facility reduced from $440.0 million to $385.0 million and the global revolving credit facility reduced from $360.0 million to $315.0 million.

Previous wording

On September 11, 2025, the Company entered into a Fourth Amendment (the “Fourth Amendment”) to the Credit Agreement. Pursuant to the Fourth Amendment, (x) the Company’s maximum consolidated secured leverage ratio was amended to be 5.00:1.00 for the quarter ending June 30, 2025 and 5.50:1.00 for the quarter ending September 30, 2025 and thereafter, (y) the Company’s minimum consolidated interest coverage ratio was amended to be 2.00:1.00 for the quarter ending September 30, 2025 and thereafter and (z) a covenant was added requiring the Company to maintain a minimum Consolidated EBITDA (as such term is defined in the Credit Agreement as amended by the Fourth Amendment) of (i) $17.0 million for the quarter ending September 30, 2025 and (ii) $52.0 million for the cumulative two quarters ending September 30, 2025 and on December 31, 2025. The aforementioned financial covenants use financial measures that are defined under the Credit Agreement and not pursuant to GAAP.

Current wording

On September 11, 2025, the Company entered into a Fourth Amendment (the “Fourth Amendment”) to the Credit Agreement. Pursuant to the Fourth Amendment, (x) the Company’s maximum consolidated secured leverage ratio was amended to be 5.00:1.00 for the quarter ending June 30, 2025 and 5.50:1.00 for the quarter ending September 30, 2025 and thereafter, (y) the Company’s minimum consolidated interest coverage ratio was amended to be 2.00:1.00 for the quarter ending September 30, 2025 and thereafter and (z) a covenant was added requiring the Company to maintain a minimum Consolidated EBITDA (as such term is defined in the Credit Agreement as amended by the Fourth Amendment) of (i) $17.0 million for the quarter ending September 30, 2025 and (ii) $52.0 million for the cumulative two quarters ending September 30, 2025 and on December 31, 2025. The aforementioned financial covenants use financial measures that are defined under the Credit Agreement and not pursuant to generally accepted accounting principles in the U.S. (“GAAP”). The Fourth Amendment also reduced the size of the

Previous wording

The Fourth Amendment also reduced the size of the Revolver from $700.0 million to $600.0 million in the aggregate, with the U.S. revolving credit facility reduced from $385.0 million to $330.0 million and the global revolving credit facility reduced from $315.0 million to $270.0 million.

Current wording

Revolver from $700.0 million to $600.0 million in the aggregate, with the U.S. revolving credit facility reduced from $385.0 million to $330.0 million and the global revolving credit facility reduced from $315.0 million to $270.0 million.

Previous wording

As of March 31, 2026, the Company’s consolidated secured leverage ratio, consolidated leverage ratio and consolidated interest coverage ratio were 4.31:1.00, 4.31:1.00 and 2.30:1.00, respectively, and the Company was in compliance with all associated covenants. The aforementioned financial covenants are being reported as calculated under the Credit Agreement and not pursuant to generally accepted accounting principles in the U.S. (“GAAP”). Please refer to the Credit Agreement and amendments filed as exhibits to our periodic reports for further information related to the calculation thereof. For risks related to our indebtedness and compliance with these covenants, please refer to the risk factor “Any default under our credit agreement or inability to refinance our indebtedness could have significant consequences” set forth in Part I, Item 1A, “Risk Factors” of our Form 10-K for the fiscal year ended June 30, 2025.

Current wording

As of September 30, 2026, the Company’s consolidated secured leverage ratio, consolidated leverage ratio and consolidated interest coverage ratio were 5.33:1.00, 5.33:1.00 and 2.23:1.00, respectively, and the Company was in compliance with all associated covenants. The aforementioned financial covenants are being reported as calculated under the Credit Agreement and not pursuant to GAAP. Please refer to the Credit Agreement and amendments filed as exhibits to our periodic reports for further information related to the calculation thereof. For risks related to our indebtedness and compliance with these covenants, please refer to the risk factor “Any default under our credit agreement or inability to refinance our indebtedness could have significant consequences.” set forth in Part I, Item 1A, “Risk Factors”.

Previous wording

From the date of the Second Amendment until the date of the Third Amendment, loans under the Credit Agreement bore interest at (a) the Secured Overnight Financing Rate plus a credit spread adjustment of 0.10% (“Term SOFR”) plus 2.5% per annum or (b) the Base Rate (as defined in the Credit Agreement) plus 1.5% per annum.

Current wording

From the date of the Second Amendment until the date of the Third Amendment, loans under the Credit Agreement bore interest at (a) the Secured Overnight Financing Rate (“Term SOFR”) plus a credit spread adjustment of 0.10% plus 2.5% per annum or (b) the Base Rate (as defined in the Credit Agreement) plus 1.5% per annum. Commencing on the date of the Third Amendment, loans under the Credit Agreement bore interest at (a) Term SOFR plus 3.00% per annum or (b) the Base Rate plus 2.00% per annum. Commencing on the date of the Fourth Amendment, loans under the Credit Agreement bear interest at (a) Term SOFR plus 4.00% per annum or (b) the Base Rate plus 3.00% per annum.

Previous wording

Excluding the impact of hedges, the weighted average interest rate on outstanding borrowings under the Credit Agreement at March 31, 2026 was 7.74%. The Company uses interest rate swaps to hedge a portion of the interest rate risk related to its outstanding variable rate debt. As of March 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 March 31, 2026 was 7.41%. 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 September 30, 2026 was 7.97%. 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, 2026, 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, 2026 was 7.50%. 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 $10.0 million at March 31, 2026 to $44.3 million as compared to $54.4 million at June 30, 2025. Our working capital was negative $399.0 million at March 31, 2026, a decrease of $652.0 million from $252.9 million at the end of fiscal 2025. The decrease was driven by the classification of $549.8 million of debt obligations, maturing on December 22, 2026, as current. Additionally, our total debt balance, net of unamortized issuance costs, at March 31, 2026 has decreased by $155.1 million to $549.1 million as compared to $704.2 million at June 30, 2025 as a result of net repayments carried out during the period.

Current wording

Our cash and cash equivalents balance increased by $4.9 million at September 30, 2026 to $63.0 million as compared to $58.1 million at June 30, 2026. Our working capital was negative $415.6 million at September 30, 2026, an increase of $1.1 million from negative $414.5 million at the end of fiscal 2026. Additionally, our total debt balance, net of unamortized issuance costs, at September 30, 2026 increased by $28.4 million to $586.2 million as compared to $557.8 million at June 30, 2026 as a result of an increase in net borrowings during the period.

Previous wording

Our cash balances are held in the U.S., U.K., Canada, Western Europe, the Middle East and India. As of March 31, 2026, substantially all cash was held outside the U.S. and there are no material restrictions on repatriation.

Current wording

Our cash balances are held in the U.S., U.K., Canada, Western Europe, the Middle East and India. As of September 30, 2026, substantially all cash was held outside of the U.S. and there are no material restrictions on repatriation.

Previous wording

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

Current wording

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

Previous wording

Cash provided by operating activities was $66.8 million for the nine months ended March 31, 2026, an increase of $42.1 million from cash provided by operating activities of $24.8 million in the prior year period. This increase in cash provided by operating activities versus the prior year period resulted primarily from working capital changes versus the prior year period, reflecting higher cash generation primarily due to focused inventory management, which generated year-over-year improvement of $70.2 million and an increase in accounts receivable collection of $19.0 million, partially offset by a reduced benefit from accounts payable and accrued expenses in the amount of $9.6 million. The changes in other current assets and accounts payable and accrued expenses for the nine months ended March 31, 2026 reflected the recognition of a $35.0 million insurance receivable and corresponding settlement liability (see Note 17. Commitments and Contingencies).

Current wording

Cash used in operating activities was $18.9 million for the three months ended September 30, 2026, an increase of $10.4 million from cash used in operating activities of $8.5 million in the prior year period. This increase in cash used in operating activities versus the prior year resulted from an increase of $7.4 million in net loss adjusted for non-cash charges and higher working capital utilization of $3.0 million in the three months ended September 30, 2026. Working capital changes, versus the prior year period was primarily due to higher inventory balance utilization of 21.5 million, partially offset by the following: (i) increase in accounts receivable recovery in the amount of $9.2 million, (ii) an increase in other assets and liabilities recovery of $5.3 million, (iii) a reduced outflow associated with accounts payable and accrued expenses in the amount of $2.4 million, (iv) an increase in other current assets recovery of $1.7 million.

Previous wording

Our free cash flow was $50.8 million for the nine months ended March 31, 2026, an increase of $45.1 million from free cash flow of $5.7 million in the nine months ended March 31, 2025. The period-over-period change resulted primarily from an increase in cash flows from operations of $42.1 million driven by the reasons explained 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 from our net cash provided by operating activities to free cash flow.

Current wording

Our free cash flow was negative $22.8 million for the three months ended September 30, 2026, an increase in negative free cash flow of $9.1 million from negative free cash flow of $13.7 million in the three months ended September 30, 2025. The period-over-period change resulted primarily from an increase in cash flows used in operations of $10.4 million driven by the reasons explained above, partially offset by lower capital expenditures of $1.3 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.

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 nine months ended March 31, 2025, the Company did not repurchase any shares under the repurchase program. As of March 31, 2026, 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 three months ended September 30, 2026, the Company did not repurchase any shares under the repurchase program. As of September 30, 2026, 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, proceeds from insurance claim, certain litigation expenses, net, plant closure related costs, net, warehouse and manufacturing consolidation and other costs, net, productivity and transformation costs, costs associated with acquisitions, divestitures and other transactions, losses (gains) on sales of assets, goodwill impairment, long-lived asset and intangibles 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 (gains) losses, certain litigation expenses, net, plant closure related costs, net, productivity and transformation costs, costs associated with acquisitions, divestitures and other transactions, gain on sale of assets, gain on remeasurement of assets reclassified to held and used, 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

In our internal evaluations, we use the non-GAAP financial measure “Free Cash Flow.” The difference between Free Cash Flow and cash flows used in or provided by operating activities, which is the most comparable U.S. GAAP financial measure, is that Free Cash Flow reflects the impact of purchases of property, plant and equipment (capital spending). Since capital spending is essential to maintaining our operational capabilities, we believe that it is a recurring and necessary use of cash. As such, we believe investors should also consider capital spending when evaluating our cash flows provided by or used in operating activities. We view Free Cash Flow as an important measure because it is one factor in evaluating the amount of cash available for discretionary investments. We do not consider Free Cash Flow in isolation or as an alternative to financial measures determined in accordance with U.S. GAAP.

Current wording

In our internal evaluations, we use the non-GAAP financial measure “Free Cash Flow.” The difference between Free Cash Flow and cash flows provided by or used in operating activities, which is the most comparable U.S. GAAP financial measure, is that Free Cash Flow reflects the impact of purchases of property, plant and equipment (“capital expenditure”). Since capital expenditure is essential to maintaining our operational capabilities, we believe that it is a recurring and necessary use of cash. As such, we believe investors should also consider capital expenditure when evaluating our cash flows provided by or used in operating activities. We view Free Cash Flow as an important measure because it is one factor in evaluating the amount of cash available for discretionary investments. We do not consider Free Cash Flow in isolation or as an alternative to financial measures determined in accordance with U.S. GAAP. A reconciliation from cash flows provided by operating activities to Free Cash Flow is as follows:

Previous wording

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

Current wording

A reconciliation from cash flows used in 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, except as noted herein.

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, 2026, from which there have been no material changes. We are providing the below update regarding goodwill.

Previous wording

The goodwill related to the U.S. and Western Europe reporting unit remains at risk of potential impairment if the fair values 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.

Current wording

As of September 30, 2026, goodwill associated with the U.S. and Ella’s Kitchen UK reporting units had a carrying value of $216.7 million and $29.3 million, respectively. The goodwill related to the U.S. reporting unit is at risk of potential impairment if the fair value of these reporting unit, and its 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 unit at risk of impairment for interim impairment indicators.

Previous 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.

Current wording

Certain of our product lines have seasonal fluctuations. Hot tea and soup sales are stronger in colder 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 diluted earnings per share in the first fiscal quarter have typically been the lowest of our four quarters.