Personal care company Edgewell Personal Care (NYSE:EPC) fell short of the market’s revenue expectations in Q3 CY2024, with sales falling 3.1% year on year to $517.6 million. Its non-GAAP profit of $0.72 per share was 7.7% above analysts’ consensus estimates.

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Edgewell Personal Care (EPC) Q3 CY2024 Highlights:

• Revenue: $517.6 million vs analyst estimates of $535.2 million (3.3% miss)

• Adjusted EPS: $0.72 vs analyst estimates of $0.67 (7.7% beat)

• EBITDA: $78.9 million vs analyst estimates of $82.06 million (3.9% miss)

• Adjusted EPS guidance for the upcoming financial year 2025 is $3.25 at the midpoint, in line with analyst estimates

• EBITDA guidance for the upcoming financial year 2025 is $362 million at the midpoint, below analyst estimates of $376.3 million

• Gross Margin (GAAP): 41.1%, down from 42.6% in the same quarter last year

• Operating Margin: 3.9%, down from 9.6% in the same quarter last year

• EBITDA Margin: 15.2%, in line with the same quarter last year

• Free Cash Flow Margin: 9.2%, up from 5.5% in the same quarter last year

• Organic Revenue fell 2.8% year on year (4.3% in the same quarter last year)

• Market Capitalization: $1.79 billion

"For the fiscal year, we achieved slight organic net sales growth, meaningfully expanded adjusted gross margins and delivered double-digit adjusted earnings per share growth at constant currency for the second consecutive fiscal year. In the face of a heightened competitive landscape and an increasingly cautious consumer, we accelerated organic growth across our international businesses, introduced category-leading innovation in the US Sun Care category and deepened our participation across the men's and women's grooming segments. The strength of our business model was reflected in our healthy earnings growth, substantial cash flow generation and structural de-leveraging of the business," said Rod Little, Edgewell's President and Chief Executive Officer.

Company Overview

Boasting brands such as Banana Boat, Schick, and Skintimate, Edgewell Personal Care (NYSE:EPC) sells personal care products in the skin and sun care, shave, and feminine care categories.

Personal Care

While personal care products products may seem more discretionary than food, consumers tend to maintain or even boost their spending on the category during tough times. This phenomenon is known as "the lipstick effect" by economists, which states that consumers still want some semblance of affordable luxuries like beauty and wellness when the economy is sputtering. Consumer tastes are constantly changing, and personal care companies are currently responding to the public’s increased desire for ethically produced goods by featuring natural ingredients in their products.