Sleepytime Tea owner Hain Celestial explores sale of personal care brands

Dive Brief:

Dive Insight:

Since taking over Hain two years ago, Davidson has prioritized stabilizing the struggling parts of the company’s portfolio to position them for growth or a potential sale.

It’s not a surprise to see Hain explore options for its personal care business, which makes up a small amount of its sales. Lotions and shampoos also have little in common with the lion’s share of its portfolio built around food and beverage brands such as Celestial Seasonings teas, Greek Gods yogurt and Garden Veggie snacks.

If Hain ends up selling personal care, it could use the proceeds to invest in its food and beverage business or to pay down debt, both priorities for the company.

A big part of stabilizing the business has included reducing the number of SKUs. It’s a major reason net sales declined close to 40% during the second quarter from the prior year.

Davidson said Hain is ahead of its goal to improve margins and stabilize sales in personal care. The remaining brands in the segment are No. 1 or No. 2 in their categories within the natural channel. 

“A lot of work has been done. We will be handing off to someone four brands that really stand apart from their competition in natural and clean ingredients so they can be authentic and run with them,” Davidson said in an interview with Food Dive on Monday. “From that standpoint, I feel like that will be both good for those brands, good for our company and good for another company.”

Hain expects to reach a decision on personal care before its fiscal year ends June 30.