Prestige Consumer Healthcare Inc. Canaccord Genuity's 46th Annual Growth Conference

Sure. Thank you. Morning, everybody. Prestige has been executing a three-pillar strategy for some time. Phil and I've been with the company about 10 years, and strategies remain the same. Of course, we've been through a lot of volatility, all of us, macro environment. The tactics have changed, but the strategy has not. We're going to invest in the brands we have. We're a marketing brand-building company. It's what we show up to do every day. We have a superior financial profile. These are need-state products that people, incidence base, they go to the store, they're not really looking to save a dollar. Not a lot of sold-on promotion, as an example, in our category. Strong margins, which enable us to then deploy the capital, that's the third pillar, effectively.

A lot of time that comes through de-leveraging, which through M&A, we kind of have gotten ourselves, bring on some new brands, get into some new categories, de-leverage back down, and then start the model all over again. That's been the strategy. It's been consistent over time and continues to be the strategy today.

Great. So, middle of June, we closed on the Breathe Right acquisition. Breathe Right is about two-thirds of the portfolio that came with that acquisition. Better Breathing is the positioning for Breathe Right. It is a brand that defines the category, similar to Dramamine, with over 90% consumer awareness. The key there is really just 3% household penetration. So in North America, we see a lot of runway for growth as we brand build, we innovate, kind of our normal wheelhouse. And then internationally as well as we expand into new markets. Breathe Right is in about 20 countries. We will look to expand that over time. Strong margins, feel good about the portfolio. It is exactly what we are looking for. A leading brand in a niche category. That is kind of the secret sauce to Prestige.

And we have a number of leading brands that are holding meaningful positions in their categories as a result of staying disciplined in that strategy. The LaCorium transaction, about 75% of those sales are in Australia. This is therapeutic skincare, anchored in the Dermal Therapy brand. Again, niche categories, think cold sores, eczema, not beauty, not general skincare. And so brand has been doing very well. The portfolio has been growing double digits for many years now. So we are excited about what that will be, largely international and different markets. Again, 75% sold in Australia. We will look to expand that into other international markets as we move forward. So, with international at about 15% of sales, our long-term growth target for our international segment is 5% plus growth top line. The entire Prestige portfolio is 2%-3% growth, so international a little bit outsized growth.

And we think these two acquisitions will help firm that up. And as we look over time, we would expect internationals to become about 20% of the portfolio as a result of the higher growth coming from these brands.

Yeah. Clear Eyes is about 3% of sales as we sit here today. A number of things have happened in the past, call it six months. We acquired our sterile eye care facility up in Canada back in December. We are about two quarters in. We feel good about the progress we are making. We have made investments in infrastructure. We have made investments in equipment. Most importantly, probably, we have changed out some leadership positions there. The most recent of which started on Monday of this week. We are excited about that, including making the general manager of that facility a long-term employee there who was back in the Pfizer days in that facility. Feeling good about the moves that we have made. What we have talked about is the improvements that we are making are going to cause some near-term variability. We saw that in Q1.

We expect to continue to see it in the second quarter, with more consistent supply expected in the back half. We have talked about expecting sequential improvement in each quarter of this year, building off of that Q1 base. Again, continue to feel like it was the right decision to bring that facility in-house, take control of our destiny. Quality is number one in everything that we do and will continue to be our focus. We will continue to make investments in the facility, and look for more consistent output. The Clear Eyes story is a supply story, not a demand story. Over time, we think about it in a couple of steps. We have got to get consistent supply on the shelf of the retailers. We have been focusing on base red and max red, our kind of core anchor SKUs with Clear Eyes.

As we do that, we will then look to fill the retailers' DCs. We will then look to rebuild safety stock. It has been some time. We have been having some supply chain issues around the brand. We are kind of feeling every bump in the road, if you will, right now. When we are carrying three to four months of inventory, the line down for a week, you will not feel it. But right now we are feeling it. Over time, we will look to bring that back on. Then we will be able to introduce new SKUs. Some of the SKUs that we have kind of put on the back burner right now, dry and itchy, and things like that. Then we can turn the marketing on.

It is going to take a couple of years to get back to where we were, but I think the retailers understand the importance of trust in this category. There has been a number of major recalls at other folks. There has been news, obviously, a few years ago around this space that was pretty alarming and concerning, and so focusing on quality, bringing the facility in-house and taking control of it, I think was the right move. Over time, we think Clear Eyes will continue. We have seen the category decline as Clear Eyes has come out. That is pretty powerful to take back to the retailers and show them how important a brand like Clear Eyes, that has the trust of the consumer, is really important, and now so more than ever.

Going to take some time, but again, as we work through fiscal 2027, we feel good about getting more consistency in supply as we exit the year.