Prestige Consumer Healthcare Inc.

Good day and thank you for standing by. Welcome to the Q2 2024 Prestige Consumer Healthcare Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you'll need to press star 1 1 on your telephone. You'll then hear an automated message advising your hand is raised. To withdraw your question, please press star 1 1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Phil Terpililli. Please go ahead.

Phil Terpililli Thanks, operator, and thank you to everyone who's joined today. On the call with me are Ron Lombardi, our chairman, president, and CEO, and Christine Sacco, our CFO. On today's call, we'll review our second quarter fiscal 24 results discuss our full year outlook, and then take questions from analysts. A slide presentation accompanies today's call. It can be accessed by visiting PrestigeConsumerHealthcare.com, clicking on the Investors link, and then on today's webcast and presentation. Remember, some of the information contained in the presentation today includes non-GAAP financial measures. Reconciliations to the nearest GAAP financial measures are included in our earnings release and slide presentation. On today's call, Management will make forward-looking statements around risks and uncertainties, which are detailed in a complete safe harbor disclosure on page two of the slide presentation that accompanies the call. These are important to review and contemplate. Business environment uncertainty remains heightened due to high inflation, geopolitical events, and supply chain constraints, as well as other various numerous potential impacts. This means results could change at any time, and the forecasted impact of risk considerations is the best estimate based on the information available as of today's date. Further information concerning risk factors and cautionary statements are available in our most recent SEC filings and most recent Company 10-K. I'll now hand it over to our CEO, Ron Lombardi. Ron? Thanks, Phil.

Let's begin on slide five. Our Q2 results largely aligned to our expectations and built on a strong Q1 results. Net sales were $286 million in the second quarter, which were the second highest level of quarterly sales in company history and slightly ahead of what we anticipated back in August. We were pleased with this performance given we faced a challenging comparison from the prior year record results. Our portfolio diversity continues to be a strength with strong sales in certain US brands and our international business, mostly offsetting this tough comparison as well as the strategic exit of the private label business we've previously discussed. Revenue translated into strong earnings and cash flow. We generated $1.07 in earnings, up 5% versus the prior year, while experiencing sequential and year-over-year improvement in gross margin, as well as a consistent EBITDA margin. Strong free cash flow enabled the pay down of $55 million in debt and we finished the quarter at three times leverage. We will continue to reduce debt while assessing other strategic capital deployment opportunities. So in summary, halfway through the year, we are on track to achieve our full year forecast, delivering strong revenue and earnings, thanks to the execution of our proven business strategy. Now let's turn to page six to discuss one example of brand building that's driving our success. Our goodies headache powders define the form and have a long 100 plus year history of helping consumers treat headaches and other ailments largely in the southeastern United States. After acquiring the brand over 10 years ago, we went to work leveraging learnings from consumers to drive increased usage of the brand. We used these and expanded with new forms and flavors, as well as with targeted offerings like goodies hangover, that solve on-the-go pain relief with great taste. Most recently, we leveraged these highly successful products with distinct marketing designed to attract new customers while deepening connections with existing ones. We've done this in two distinct ways. First, we've had wide-ranging media emphasizing the concept of make the day count for consumers that has driven important brand visibility. Second, We've had successful national exposure on Thursday Night Football, where the brands get to good marketing ads are driving increased interest in goodies online. These recent marketing tactics are successfully leveraging our brand building toolkit to drive share with consumers and retailers, and the results are clear. In the fiscal year to date, we've grown goodies headache powders over three times faster than the overall analgesic category. Now let's turn to slide seven for an update on e-commerce. Alongside these brand building efforts is our emphasis in aligning investments with channels that are important to consumers. As consumer shopping habits shift, our end goal is to be readily available and prominent to consumers wherever they shop. E-commerce continues to be the key example of this. As shown on the left side of the page, we experienced strong 6% consumption growth in the first half of the fiscal year. Equally important is that we've achieved strong performance across all of our e-commerce partners and with a consistent profit profile. Our success is driven by effective strategies, including targeted content, effectively managing our product assortment, and making broad investments with each of our e-commerce partners to better connect with consumers. Two recent examples are shown on the right side of the page. On the top, there are a few examples of online brand story pages, which help upgrade the user experience of learning about an overall brand while shopping actively for a specific product. On the bottom is a reminder of investments around content. We continually refresh online content for each of our brands to help drive traffic and ultimately purchases as consumers seek solutions for their healthcare needs. So in summary, we continue with consumers across e-commerce through our investments in online content and digital advertising and are well positioned for further growth. Now I'll pass it to Chris to walk through the financials.