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All They’re Trying to Do is Act Naturally: The Hain Celestial Group, Inc. (HAIN), General Mills, Inc. (GIS), Kellogg Company (K)

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Today I’m focusing on The Hain Celestial Group, Inc. (NASDAQ:HAIN) – a major player in the natural and organic products category. They participate in several natural categories with well-recognized brands that include Celestial Seasonings, Spectrum Naturals, Spectrum Essentials, Almond Dream, and a host of others.

This Stock is Riding one of the Biggest Consumer Trends in AmericaIn February, the company reported their second quarter Fiscal Year 2013 (ended Dec. 31, 2012) results. What is significant for investors concerning The Hain Celestial Group?

Record Net Sales

The Hain Celestial Group, Inc. (NASDAQ:HAIN) had net sales of $455.3 million in the second quarter of Fiscal Year 2013, compared to prior year period net sales of $364.8 million. This represents an increase of 24.8 percent. These robust net sales results show the company is giving consumers the unique healthier products they desire. For example, they offer their Earth’s Best Organic line, which is the first complete line of organic foods for infants. Another example is their Nile Spice brand – the company’s all-natural soup cups.

Growth in Different Geographic Regions

The Hain Celestial Group, Inc. (NASDAQ:HAIN) had 9.4% gross sales growth on a comparable basis. Hain Daniels in the United Kingdom concentrated on “higher margin” brand growth. Furthermore, Hain Celestial experienced profitable growth in Canada as well as Europe. Hain Celestial US also had greater profitability.

Strength via Acquisitions

Hain Celestial acquired top brands during the quarter, including Hartley’s jam and Sun-Pat peanut butter. Both brands lead their categories in the UK. In December 2012, the company acquired the BluePrint brand. With this brand, The Hain Celestial Group, Inc. (NASDAQ:HAIN) is now acting quite naturally in the 100% natural, unpasteurized, juice class.

Comprehensive Brand Strength

Top brands, including Celestial Seasonings, Imagine, Alba Botanica, Lima, and Linda McCartney, among several others, led the company’s brand strength. Investors should consider that Hain Celestial is leaving no stone unturned in the natural and organic field in which they play, having products across a host of food categories.

Healthy
Operating Free Cash Flow

Hain Celestial had operating free cash flow of $106.8 million for the 12 months ended Dec. 31, 2012. This represents an increase of 47.6%.

A healthy operating free cash flow means a company has the money to engage in product development, and it gives them leverage for undertaking acquisitions as well, among other initiatives. This cash flow is significant because the company still generated major cash after utilizing the financial resources needed to maintain and build their assets.

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