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The Hain Celestial Group Inc. ( HAIN - Analyst Report ) , which distributes, markets and sells various natural and organic foods as well as personal care products, announced that it has completed the earlier announced acquisition of the New York City based BluePrint, a premier brand in the raw juice category.
The company expects the deal to be incremental to its sales, solidifying its foothold in the raw, organically extracted fruit and vegetable juices category. Moreover, the company stated that the acquisition will be accretive to its earnings in 2013.
Acquisitions have played a vital role in Hain Celestial’s strategy of building market share. These have not only widened the company’s geographical presence, but also furnished opportunities to cross-sell products in the U.S., Canadian, and European markets.
Earlier, the company completed the acquisition of leading packaged grocery brands – Hartley's, Gale's Robertson's, Frank Cooper's and Sun-Pat – from Premier Foods plc.
Premier Foods is now a part of the Hain Daniels Group and is expected to generate sales of about $180 million for the 8 months period closing on June 30, 2013. Moreover, it will add approximately 25 cents, excluding the charges related to the acquisition, to the earnings.
Going forward, the company hopes to sustain strong momentum across entire business segments as it remains well positioned to capitalize on the growing global demand for organic products.
Alongside, the company anticipates sales to be in the range of $1.780 billion – $1.795 billion in fiscal 2013 (excluding results for the discontinued operations of private label chilled ready meals). Earnings are expected to be in the range of $2.35 – $2.45 a share.
Moreover, Hain Celestial has undertaken a number of initiatives to improve its performance and has directed itself on the growth trajectory. The company’s Stock Keeping Unit (“SKU”) rationalization program has helped eliminate SKUs, which had lower sales volume or weak margins. Management remains focused on improving profitability through new product introductions while reducing costs.
Currently, we have a long-term ‘Neutral’ recommendation on the stock. Hain Celestial, which competes with General Mills Inc. ( GIS - Analyst Report ) , holds a Zacks #3 Rank, which translates into a short-term ‘Hold’ rating.
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