Edgewell Personal Care Reports Decline in Q2 and First Half of Fiscal 2025

Edgewell Personal Care Company reported a decline in financial performance for the second quarter and first half of fiscal 2025, as detailed in its latest 10-Q filing. For the three months ended March 31, 2025, the company recorded net sales of $580.7 million, a decrease of 3.1% from $599.4 million in the same period last year. The decline was attributed to a 1.5% drop in organic sales, primarily driven by volume declines in Wet Shave, Feminine Care, and Sun Care products in North America. Net earnings for the quarter were $29.0 million, down from $36.0 million a year earlier, resulting in diluted earnings per share of $0.60 compared to $0.72 in the prior year.

In the first six months of fiscal 2025, Edgewell's net sales totaled $1,059.1 million, a decrease of 2.7% from $1,088.3 million in the same period of fiscal 2024. The company experienced a similar trend in net earnings, which fell to $26.9 million from $40.8 million in the previous year. The decline in profitability was influenced by lower sales volumes and increased promotional expenses, despite a slight improvement in gross margins. The effective tax rate for the first half of fiscal 2025 was 32.1%, significantly higher than the 23.0% reported in the prior year, reflecting an unfavorable mix of earnings in higher tax jurisdictions.

Operationally, Edgewell has been focusing on restructuring efforts to enhance its operating model and improve supply chain efficiency. The company incurred restructuring charges of $12.2 million in the second quarter, up from $3.2 million in the same period last year. These efforts include consolidating operations in Mexico and streamlining organizational processes. Additionally, Edgewell has been investing in advertising and sales promotion, with expenses rising to $65.5 million in the second quarter, compared to $63.1 million in the prior year.

Geographically, the company reported a 2.9% growth in international markets, driven by both price and volume gains, while North American sales declined by 3.9%. The Wet Shave segment saw a slight increase in segment profit to $46.6 million, while the Sun and Skin Care segment's profit decreased to $50.8 million. The Feminine Care segment faced significant challenges, with profits dropping to $3.1 million, reflecting a 64.4% decline year-over-year.

Looking ahead, Edgewell anticipates continued challenges in the North American market but remains optimistic about growth opportunities in international markets. The company plans to maintain its focus on restructuring initiatives and product innovation to drive future performance. Despite the current downturn, Edgewell's management believes that its cash flow from operations and available credit will support its working capital needs and strategic investments in the coming months.