Prestige Consumer Healthcare Inc. (NYSE:PBH) Q3 2023 Earnings Call Transcript

Christine Sacco: Hi Rupesh. So the guide – reported guide going from 4% growth to 3% growth is really FX driven. We have seen some currency headwinds, as a reminder for us that – in particular, the Australian and Canadian dollars, there has been a lot of movements, particularly in the third quarter in the Australian dollar, in particular. So from an EPS perspective, as we just talked about, right, we narrowed our original sales guy to the lower end of the range. There is some currency headwinds sitting in the P&L. It is just another expense related to the currency headwinds I just discussed. And then interest got called up just about $1 million for Q4, just given the timing of some of the rate hikes and the pay down. So those are the main drivers of EPS calling down to the lower end of the range, but still within the target range.

Rupesh Parikh: Okay great and then just in terms of the categories that you guys called out this week, Women’s Health and Eye & Ear Care, when do you expect those categories to improve? Is that something Q4 or next year, maybe it is just some thoughts there?

Ronald Lombardi: So let’s talk about those both individually starting with eye care, Eye & Ear. We actually continue to have great momentum in that category. Consumption is good. Sales are good, as I mentioned in response to Susan’s question, the issue in the third quarter for us is really all about supply chain impact and we expect a bit of that into the fourth quarter as well. And then on Women’s Health, we have actually seen a decline in the total category. Again, we continue to see consumer changes as a result of COVID and everything else that has been going on, and in particular, women going back to the doctor’s office impacting the yeast infection category, and continued impact on the go portion of the Summer’s Eve business.

So, again, it is easy to forget, but we are really in year three of three years of disrupted factors on the business and in some cases, it is comps versus a funny number last year, in some cases, it is the continuation of a change in consumer habits or continuing to chase supply to keep up with demand.

Rupesh Parikh: And maybe one last question. So I know you are not ready to provide FY 2024 guidance. But just curious, is there any puts and takes you can share at this point. And I am curious just on A&M, I know this year went down to 13% of sales, do you expect that to be a larger percent of sales next year? Thank you.

Ronald Lombardi: Yes. So let me start I guess with a comment on overall momentum of the business like I said on the prepared remarks today, we continue to feel good about the positioning of the business, the consumption trends behind many of our brands, and we feel that we are positioned for continued growth in fiscal 2024 after two record years top and bottom line in a row. And I will let Chris comment on A&M for next year.

Christine Sacco: Sure. So obviously more details to come in May Rupesh, but we always talk about our A&M plans being built up from the bottom with our marketing teams. We talked about additional A&M support being pulled a little bit this year, really related to categories where we have strong demand, regardless of our investment. And I would couple that with our ability to provide supply in this environment that we are talking about. So more to come next year, A&M spend is always driven by the timing of initiatives and new product launches and a whole bunch of variables. But we will give you more details in a few months here.

Rupesh Parikh: Great, thank you. I will pass it on.

Operator: Thank you. And our next question will come from Jon Andersen of William Blair.