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Acquisitions Help Helen Of Troy Offset Sales Declines In Core Segments

With recent acquisitions helping boost Helen of Troy’s second quarter revenue, the company on Thursday reported that sales in key categories including housewares and beauty were down for the period ending May 31.

Company-wide net sales for the quarter increased 10.8% to $345.3 million, compared to $311.8 million in the first quarter of fiscal year 2015. The figure includes three months of operations of Healthy Directions, which was acquired on June 30, 2014, and two months of operations of the VapoSteam business, which was acquired on March 31, 2015.

The company also reported that its net revenue for Q2 includes three months of operations of Healthy Directions, the nutritional supplement company it acquired on March 31 of this year. That acquisition contributed almost $40 million to sales revenue.

Helen of Troy also reported a decline in core business net sales revenue of $6.5 million, or 2.1%. Foreign currency fluctuations decreased consolidated U.S. Dollar reported net sales revenue by $7.7 million, or 2.5%, year-over-year. Additionally, the impact of the West Coast port disruption negatively impacted net sales revenue, primarily in the Beauty segment, company officials said.

Helen of Troy CEO Julien Mininberg said the company’s healthcare/home environment segment led its quarterly performance, with sales growth of 0.4%. He noted that new product introductions, a relatively strong end to the flu season and the VapoSteam acquisition were key factors driving the business.

Sales in the company’s housewares segment declined $1.6 million. Helen of Troy officials said this decline was primarily due to shifts in the timing of customer orders heading into the fourth quarter of fiscal year 2015 and second quarter of fiscal year 2016, as well as inventory adjustments by several key retailers.

In the beauty segment, sales were down 4.7%. Mininberg said that this segment experienced a 2.1% negative impact from foreign currency fluctuations, as well as disruption from recent the West Coast port delays.

 “We had a solid first quarter positioning us well to achieve our annual goals. The quarter was highlighted by a double digit increase in revenue and growth in adjusted diluted earnings per share, in line with our expectations, despite a greater-than-expected impact from foreign currency and the West Coast port disruption,” he said.