Edgewell Personal Care Company

Good morning and welcome to Edgewell's second quarter fiscal year 2026 earnings call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key on your telephone keypad. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then 1 on your telephone keypad. To withdraw your question, please press star and then 2. Please note this event is being recorded. I would now like to turn the conference over to Chris Goff, Vice President, Investor Relations. Please go ahead.

Good morning, everyone, and thank you for joining us this morning for Edgewell's second quarter fiscal year 2026 earnings call. With me this morning are Rod Little, our President and Chief Executive Officer, and Fran Weissman, our Chief Financial Officer. Rod will kick off the call and then hand it over to Fran to discuss our second quarter 2026 results. and full year fiscal 2026 outlook. We will then transition to Q&A. This call is being recorded and will be available via replay on our website, www.edgewell.com. During this call, we may make statements about our expectations for future plans and performance. This might include future sales, earnings, advertising and promotional spending, product launches, brand investment, organizational and operational structures and models, cost mitigation, and productivity efficiency efforts, savings and costs related to restructuring and repositioning actions, acquisitions, dispositions and integrations, impacts from tariffs and other recent developments, such as the conflict in the Middle East, changes to our working capital metrics, currency fluctuations, commodity costs, energy and transportation costs, inflation, category value, future plans for return of capital to shareholders, the disposition of our feminine care business, and more. Any such statements are forward-looking statements for the purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995, which reflect our current views with respect to future events, plans, or prospects. These statements are based on assumptions and are subject to various risks and uncertainties, including those described under the caption risk factors in our annual report on Form 10-K for the year ended September 30, 2025, and this may be amended in our quarterly reports on Form 10-Q filed with the SEC. These risks may cause our actual results to be materially different from those expressed or implied by our forward-looking statements. We do not assume any obligation to update or revise any of these forward-looking statements to reflect new events or circumstances, except as required by law. During this call, we will refer to certain non-GAAP financial measures. These non-GAAP measures are not prepared in accordance with generally accepted accounting principles. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures is shown in our press release issued earlier today, which is available at the investor relations section of our website. This non-GAAP information is provided as a supplement to, not as a substitute for, or as superior to measures of financial performance prepared in accordance with GAAP. However, management believes these non-GAAP measures provide investors with valuable information on the underlying trends of our business and allows more meaningful period to period comparisons of ongoing operating results. As a reminder, Our results this quarter reflect one month of the feminine care business classified as discontinued operations. Prior period results have been recast to reflect this presentation. The results of the feminine care business are reported separately from continuing operations. All of our commentary today, unless otherwise stated, on performance and our outlook, will reflect continuing operations, including our wet shave, sun, and skin care business. With that, I'd like to turn the call over to Rod.

Thank you, Chris, and good morning, everyone. We appreciate you joining us for our second quarter fiscal 26 earnings call. We delivered a strong second quarter with top line and bottom line results ahead of our expectations, reflecting the actions we've taken to strengthen the business, improving our execution, and delivering innovation that is resonating with consumers. The top line strength, together with solid gross margin performance and disciplined execution, enabled us to deliver adjusted earnings per share and adjusted EBITDA ahead of our outlook. Importantly, these results reflect continued progress in our strategy execution, concentrating resources on the categories and markets where we have clear competitive advantage. And we're seeing this show up in improved consumption and market share performance, including in the United States. Internationally, we continued to see solid market share performance across our key markets. In the U.S., we delivered accelerating consumption growth and share gains, both value and volume. U.S. value share increased by approximately 50 basis points in aggregate in the quarter, with gains across branded manual shave, shave preps, grooming, sun care, and skin care. This is an important inflection point for the company, as we expect to transition to a growth profile in the second half of the fiscal year. While we continue to operate in an uncertain environment, we're executing against four priorities that we expect will drive both our near-term performance and our long-term strategy. These priorities are international markets, innovation, productivity, and our U.S. transformation. These priorities are at the center of how we allocate capital and focus, directing our resources where we see the strongest linkage between investment, improved execution, and the highest returns. This focus is evidenced in our simpler, higher-quality portfolio with a stronger margin profile post the FemCare divestiture, which we completed in February. We're moving forward with flexibility to allocate investments to the categories where we believe we have global scale, clear competitive advantages, and momentum. This is wet shave, sun and skin care, and grooming. We're also more regionally balanced, with roughly half of our sales in North America and half in international markets. Within the portfolio, wet shave now represents approximately 60% of our sales. and our sun, skincare, and grooming businesses combined are now approaching 40% of total sales, with grooming now over 10% of the business. With that context, let me give you an update on our progress across each of our four priorities. First, durable international growth. We saw a return to growth in the quarter, with continued good underlying consumption and market share trends broadly across nearly all key markets. While slower first-half sales reflected timing and phasing impacts versus last year, we believe we are now positioned for strong sales growth throughout the remainder of the fiscal year. Second, compelling innovation. We remain committed to delivering consumer-led, locally designed innovation across our portfolios. We are now positioned to realize the benefits from the investments we made in fiscal 25 when we expanded Billy into Australia, Bulldog entered premium skincare across Europe, we took Schick into premium skincare in Japan with the launch of Progista, and we broadened Crimla's range in the United States and Europe, driving meaningful growth. We are also equally excited about the remainder of fiscal 26. We have a robust second half innovation pipeline, including hydro and intuition relaunches in Japan, new Wilkinson Sword and Hawaiian Tropic launches in Europe, and meaningful launches across grooming and sun care in the U.S. Together, these initiatives reinforce innovation as a key driver of our strategy. All of this is supported by a significant step up in A&P spend. that's focused on brands and markets where we see the strongest linkage between investment, distribution gains, household penetration, and repeat rates. Third, productivity through supply chain optimization. We are executing our productivity agenda with consistency and urgency. This quarter, we delivered approximately 220 basis points of gross productivity savings. These actions are an important driver of our profit profile. softening tariffs and inflationary pressures, simplifying the organization, improving speed and service levels, and creating capacity to reinvest behind our core brands. We continue to make progress on our wet shave manufacturing consolidation, an important program to simplify our footprint, modernize our shave technologies and capabilities, and improve the structural economics of the business. Phase one, consolidating the first two plants, which primarily support private label, into our new greenfield site is nearly complete and represents the most operationally complex stage of the program. Throughout the transition, our priorities are clear. Protect customer service, maintain on-shelf availability, and minimize disruption for our retail partners. To support service levels, we're investing to protect fill rates, including in some cases, running duplicate sites longer than planned, as well as absorbing higher operating costs, such as overtime and incremental air freight. Importantly, the program remains on track to deliver the intended service outcomes and savings. As we reach steady state, we expect to begin realizing savings in fiscal 27, with a full run rate in fiscal 28, equating to roughly two points of expected company-wide gross margin improvement. Fourth, our U.S. commercial transformation. From an organizational perspective, we've simplified our U.S. structure to reduce complexity and accelerate decision-making with new leadership in place and clear accountability across our commercial teams. We're also investing behind core capabilities, insights and analytics, media and content, category development, and revenue growth management. We anticipate that this will improve how we execute a shelf with our retail partners and win with consumers. And these actions are already yielding results as reflected in the improved consumption and market share trends we're seeing today. We've also taken decisive action to increase investment in our five U.S.-focused brands, Schick, Billy, Hawaiian Tropic, Banana Boat, and Cremo. shifting to a more sustained brand building and a balanced full funnel marketing mix. You can expect to see this step up in spending in the second half of the fiscal year. We've recently launched new campaigns and support for Billy and Cremo, a new Schick master brand do right by your skin campaign featuring Nick Jonas and our first banana boat campaign in five years. All examples of the kind of bigger, more impactful, full-funnel campaigns we're bringing to market, with support coming soon on Hawaiian Tropic as we head into the sun season in the Northern Hemisphere. The new shift campaign sharpens our focus with the skin-first approach that treats shaving as the first step in skin care. This builds on our heritage and expertise in hair removal while redefining the category through a skin-first perspective. These campaigns build on the work we've done to identify consumer needs at a more granular level, driving sharper brand positioning and raising the bar on disruptive, creative, full funnel, and omni-channel excellence, delivered through our recently restructured marketing team and our new fully integrated agency partner. Moving forward, continued support on our core brands will be coupled with sharper insights, greater focus on innovation and renovation, and continue to push for excellence in revenue growth management and omnichannel execution to drive our growth. Overall, we expect these actions to strengthen our fundamentals and position us for growth over the longer term in the U.S. So as we look forward to the remainder of fiscal 26, we are reaffirming our underlying outlook for the fiscal year. We are encouraged by our second quarter and our first half performance and the progress we're making across the business, which increases our confidence in our ability to deliver our plan. At the same time, we're operating in an uncertain macro environment, and we have the bulk of our sun care season ahead of us, so we are maintaining a disciplined and balanced outlook. Since our prior update, overall risk has increased given the conflict in the Middle East. While we are maintaining our ranges, we see a modest incremental risk to top line, particularly in our Middle East markets, as well as higher inflation risk, most notably from oil and higher fuel costs. At the same time, we continue to see a balanced set of opportunities and levers across the business to help offset these incremental headwinds, which is why we remain confident in our ability to manage through these items, and we are comfortable holding our adjusted ranges. Our confidence is grounded in the strategy I discussed earlier. Durable international growth, compelling innovation, productivity and supply chain optimization, and our U.S. commercial transformation. To reiterate, the key underlying assumptions embedded in this outlook. First, we expect a return to organic net sales growth, driven by strong second-half growth in international markets and a return to growth in North America as our U.S. initiatives continue to take hold through the second half of the fiscal year. Second, our plan includes a step-up in brand and AMP investment, most notably in the United States, to support our commercial transformation and to accelerate our key brands. We believe this investment, together with our innovation pipeline, will strengthen consumer response and drive higher consumption and market share over time. Third, we expect gross margin expansion, supported by productivity gains, pricing actions, and and tariff mitigation efforts that are expected to build as we move into the second half of the fiscal year, partially offsetting inflationary headwinds. Fourth, even as we invest for the longer term, we intend to continue to prioritize adjusted free cash flow generation through working capital improvement and disciplined spending. And consistent with this approach, our near-term capital allocation priorities remain focused on strengthening the balance sheet, most notably using proceeds from the FemCare sale to pay down our revolver balance this quarter. Of course, underpinning all of this is the strength of our team and our ability to execute with excellence. The progress we made this quarter reinforces our conviction in our plan and increases our confidence in returning to solid, sustainable growth beginning in the second half of our fiscal year, while expanding margins and cash flow in a way that builds long-term shareholder value. With that, I'll turn it over to Fran to walk you through our results and outlook for fiscal 26. Fran?