Lake Success, NY—The Hain Celestial Group has completed the sale of Tilda, a premium basmati and specialty rice brand, to EBRO FOODS S.A. for a purchase price of $342 million in cash, according to a press release.
The purchase price reflects an adjusted EBITDA multiple of 13.5x, based on estimated fiscal year 2019.
Hain Celestial expects to use a portion of the proceeds to pay down debt and is evaluating distribution alternatives for the remainder to maximize value to shareholders.
Tilda is expected to contribute approximately $200 million in net sales and $25 million of adjusted EBITDA for the fiscal year ending June 30, 2019.
Related: Hain Celestial Sells WestSoy to Keystone Natural Holdings
Hain Celestial Reports Weak Quarter, Expects Future Growth
Hain Celestial Completes Sale of Hain Pure Protein
Mark Schiller, president and CEO of Hain Celestial, said in the press release: “We are pleased to complete the strategic sale of Tilda, which is consistent with our transformational plan to simplify our portfolio, strengthen our core capabilities and expand margins and cash flow. Tilda has been a strong business for us, primarily in the United Kingdom, and under new strategic ownership, we expect the brand to continue to thrive. We believe this transaction represents a significant premium to a majority of other European food and global rice nad pasta industry transactions over the last several years. In addition, this divestiture will enable us to reduce our exposure to marketplace disruption associated with the uncertainty of Brexit and additional future potential foreign currency fluctuations.”
Hain has reported financial results for its fourth quarter and fiscal year ended June 30, 2019. Financial highlights include:
- Net sales decreased 10% to $557.7 million compared to the prior year period
- Gross margin of 19.0%, a 120 basis point decrease over the prior year period and a 190 point decrease from the third quarter of fiscal 2019
- Operating income of $0.7 million, compared to $16.6 million in the prior year period and $23.9 million in the third quarter of fiscal 2019
- Net loss of $7.7 million, compared to $4.6 million in the prior year period and net income of $10.1 million in the third quarter of fiscal 2019
Fiscal year results:
- Net sales decreased 6% compared to the prior year
- Gross margin of 19.3%, a 170 basis point decrease over the prior year
- Operating loss of $14.9 million compared to operating income of $106 million in the prior year
- Loss per diluted share of $0.48 compared to earnings per share of $0.79 in the prior year
The full press release can be found here.