The Hain Celestial Group, Inc. (HAIN) Q1 2013 Earnings Report, Transcript and Summary

Good afternoon. My name is Keena, and I will be your conference operator today. At this time, I would like to welcome everyone to the Hain Celestial First Quarter Fiscal Year 2013 Earnings Conference Call. [Operator Instructions] Mary Anthes, you may begin your conference.

Thank you, Keena. Good afternoon, and thank you joining us today. Welcome to the review of our First Quarter Fiscal Year 2013 Results. We have several members of our management team here today to discuss our results. Irwin Simon, our Founder, President and Chief Executive Officer; Ira Lamel, Executive Vice President and Chief Financial Officer; John Carroll, Executive Vice President and Chief Executive Officer, Hain Celestial U.S.; and Rob Burnett, Chief Executive Officer, Hain Daniels. Our discussion today will include forward-looking statements which are current as of today's date. We do not undertake any obligation to update forward-looking statements either as a result of new information, future events or otherwise. Our actual results may differ materially from those projected and some of the factors which may cause results to differ are listed in our publicly filed documents, including our 2012 Form 10-K filed with the SEC. This conference call is being webcast, and an archive of the webcast will be available on our website at www.hain-celestial.com, under Investor Relations. [Operator Instructions] Now let me turn the call over to Irwin Simon, Irwin?

Thank you, Mary, and good afternoon and first, I want to put our well wishes out to all those affected by Hurricane Sandy. It was quite a devastating storm and from a Hain standpoint, #1, we have 5 plants that were down, Monday and Tuesday, 4 back up Wednesday, all our distribution centers are out there distributing except one. We have one plant that should be back up running. We have no power in our Long Island Corporate offices, but we've moved a lot of the functions out to Boulder, but we are here taking orders and billing and we are absolutely back up to speed. But again, we're here to help out with food and everything else we can to get people back to normal and our thoughts are with everybody. With that, now let's look at Q1 and our first quarter fiscal '13. It seems like we just reported Q4 a few days ago. Very strong quarter, great quarter. Our sales, $359.8 million versus $286.6 million, up 25.4%. Not included in those $359.8 million is $12.2 million of discontinued sales. Our gross profit, $95.2 million versus $79.8 million, up over 19% and our operating income non-GAAP, $32.9 million versus $25.3 million, up 30%. EBITDA non-GAAP for the quarter, $40.4 million versus $32 million, up 26%. EPS GAAP of $0.42 versus $0.28, up 50% and EPS non-GAAP, $0.40 versus $0.30, up 33.3% and our free cash, which I think is the most important and what pays the bills is cash, $102.1 million, up from $85.5 million and Ira will talk more about that later so it shows we're generating a lot of cash here. So let's come back and talk about the quarter. #1, you heard me talk about strong sales. You heard me talk about our gross margins up 19%. We paid down over the last 11 months since we did the Daniels acquisition, over $100 million, which allows us to go out there and do other acquisitions or do buybacks or do other things with our capital. We've gained tremendous amount of new distribution, which John will talk about when he speaks and Rob when he talks, some of the new distribution. We sold the ICL business, which was a private label meals business in August, which closed. We will close on our U.K. -- we'll close on our sandwich business, food to go, daily bread business tomorrow. We have closed on our U.K. grocery business, which was project done to the Premier Foods brands of Sun-Pat, Hartley's, Gale's and Rosie's. We are pretty excited about that. I have spent some time over the last couple weeks with Rob and his team and there's so much we could do and I happened to get a chance to visit a few U.K. retailers and one U.K. retailer says, hey, we're behind the health and wellness trend in the U.S., with Hain's depth and breadth of products, can you help us with a lot of health and wellness products just even with gluten-free, nondairy, lower sodium and just a few. So we are absolutely looking to do that and being a bigger player now in the grocery side of the business, that will help us and Rob will talk about that shortly. Our Cully & Sully business in sales are strong up in Ireland and we'll look to introduce a lot of our other products into the Irish market. Our U.S. business, on an adjustment up 10%, that's on shipments, consumption even higher, which John will talk about and we had to overcome major cuts on Earth's Best and MaraNatha, Earth's Best due to demand of pouches and some of our other products from a co-packer and MaraNatha, just with the demand of peanut butters and nut butters, because of the Sunland recall. So great consumption but we just can't keep up with demand. John and his teams margin up 67 bps with high commodity cost and taking a price increase that's not effective 'til October. And just to come back, our tea sales, we're not even into tea season yet and our tea sales are up over 11%. Our Greek Gods, our Yogurt business and a lot of new products coming from yogurt and exciting products and you're going to see the next evolution of Greek yogurt, up 35%. And now with Greek Gods going into Canada in a much bigger way on both coasts, Rob will talk about introducing it into the U.K. in November. We'll continue to become much more of a major brand within Hain. Gluten-free, and we hear a lot about gluten-free and there's a lot of talk and size and scale. Arrowhead Mills and DeBoles, which have a lot of gluten-free products, both brands up over 35% and there's brands that we've created, gluten-free products within the brand and it really gone out and expanded distribution. So, great growth there. Linda McCartney, the whole Tempe Tofu business, both up double-digits, 13%, 14%, which shows again, the whole meat-free category and the continuous demand for meat-free and meat-free Monday has really caught on. Our Personal Care business and our NSF and concern with what you put on your body and Personal Care products and in regards to baby products in the ingredients, big growth in that area for us. So 13 of our brands, at least, had double-digit growth. 11 had high single, mid single-digit growth so we had a lot of good growth in our brand. As we come back and look at our countries, our Canadian business, up over 15%. Our consumption there grew 9% and just MaraNatha, our Greek Gods, our Spectrum business grew there. Our Yves business in Canada was flat and that is with one customer that just had some changes in some buying and that was just from in a quarter, but in the first month of October, we've seen a lot of good sales come into that. A lot of new retailers in Canada. Target is in there in December, a lot more new Walmarts opening, Whole Foods is opening more and more stores and the Canadian market is really getting some good growth and good opportunities for us there. Europe, we had a good quarter in Europe. Europe up 9.7% on local currency. GG Cracker is up 39% that's because we took over shipping here in the U.S. Our Rice Dream, Natumi business, up 11%. Our Lima business, up 6%. So all that's going on in Europe's still up close to 10% local currency and that's a good turnaround for us in Europe and I really like what I see there. Now Rob will take you through the rest of the U.K. business and some of the stuff that we got going on, which is pretty exciting. We're now into turkey season and our joint venture, which we own 49% of Hain Pure Protein, overall sales, up 14%. ABS sales, which are antibiotic free sales up 82% -- is 82% of sales. Turkey sales up 16%, chicken sales up 7% and we just don't have enough capacity and that we just don't have any more capacity. We really have a big Thanksgiving plan. We're basically sold out of turkeys and the numbers that we have committed to is just astronomical and what the consumer wants today is an antibiotic-free turkey. So it's great to see. Our Asia business, with our partnership with Hutchison Whampoa like-for-like, Hong Kong sales up 35% and consumers are loyal to our brands. I mean, Hong Kong is a smaller market with 8 million people, but they're getting used to our brands, know our brands and continue to show great growth. We have a lot of brands that are in the U.K. today -- are in Hong Kong, up 15% and China and the balance of Asia distribution, we're gradually building and our overall sales to Asia today is 30% of sales. In China, today, we're in over 200 stores, Philippines, we're in over 70, South Korea, we're in over 95. And right now, we have a team that's looking at doing local production of ours Snacks business in Asia and we hope to get that going very shortly. We've heard a lot about Prop 37 and the thing is will it win or not? What's important is California is the first state to really measure and legislate the requirements for labeling and we've always supported labeling, it's very important for us. It's important to identify where there is GMOs or not GMO-free and we do that on our products. 98% of Hain products are GMO-free. So it's going to be interesting to see what happens November 4. But whatever happens, there's just a lot of attention brought to and a lot of notice and I think you're going to see a lot of more states follow on here and maybe different language within the bill. But today, I sit here and say we come out a winner no matter what because 98% of our products are -- the date is November 6, not November 4, when the vote will be. You saw today that we announced a great acquisition. It's something I've done many times, a product called BluePrint and I look at BluePrint as a juice, as a cleanse, as a meal. It was launched in 2007 by Zoë Sakoutis and Erica Huss. Zoë, I'll get your name right. And I think they really got it right. If you come back and look at the juicy ingredients, they are all organic, been to their facility in Long Island City. It's not pasteurized so you're getting all the nutrients, having one of their juices for lunch is like eating a salad and really, I come back and look at pasteurized juice today and it's almost like canned soup and where that's going. And we just think there's a lot more opportunities with that product just not only with juice and meal replacement but going into bars and a lot of other products. We feel like, that from a lifestyle brand and what else we can do with that and we're spinning this caught on today and look what's happened with Lululemon from exercising and where that brand has gone and there's a tremendous correlation here. So we're pretty excited and we're pretty excited that Zoë and Erika and the team will be joining Hain and will really help us from a lifestyle and looking to take that on a global basis whether it's U.K. and Canada. So that should close some time in December. Just that nobody's is confused and Ira will talk about confirming guidance, we're now into our second quarter, which does include 2 months of our U.K. acquisition, one month of discontinued operations of food-to-go and does not include anything of ICL, which was sold in August. We're comfortable with first call EPS and sales expectations that are out there. So great quarter and I really feel good about what we're doing where eating healthy is becoming a bigger part of our lives. What I've seen as you saw, anybody went near any supermarkets on Friday, Saturday, Sunday, shelves were bare and we're out there right now trying to replenish a lot of stores and get products back out there and we feel just, individuals staying at home, families staying at home eating and replenishing that, something that we'll do over the next few weeks. So we feel good about business. What I'll do is turn it over to John and he'll take you through some of the exciting things that he has doing or going on in the U.S. John?

Thanks, Irwin. Good afternoon. Q1 was again, a very strong quarter for Hain Celestial U.S. and it provided a great start to FY '13. So we had many highlights in the quarter. I want to start first with our Q1 Nielsen all outlets combined or AOC consumption growth, which was 11%, which reflects consumption momentum in all measured channels. Our 11% AOC growth was driven by gains across the portfolio, including we had 16 brands in terms of double or high single-digit consumption increase in the AOC world. Our total consumption growth was 9%, reflecting the strong AOC results, as well as our high single-digit growth in the natural channel. Our Q1 sales were $252.6 million, which were up 8.1% versus a year ago. The difference between our 9% total consumption growth and our 8.1% sales growth reflects lapping year ago sales from discontinued low margin club private label and Martha Stewart SKUs. Our Q1 U.S. sales growth ex these discontinuations was actually higher than our 9% total consumption growth, reflecting stronger growth even in the retailers that are not measured by AOC or spins. Also in Q1, our gross profit margin was up 67 bps, as Irwin said, as we are able to offset inflation with productivity savings and dairy cost favorability. Additionally, our Q1 SG&A as a percent of sales was down 20 bps, reflecting the sales increase and continued tight control of expenses. All this led to Q1 U.S. operating income of $36.5 million or 14.5% of sales, which was up 15% and 87 bps, respectively, versus year ago. We leveraged strong consumption in top line growth with our gross profit improvement and our increased SG&A efficiency to drive a double-digit operating income gain. Finally in Q1, our U.S. inventories were down $5 million versus year ago while supporting our sales growth. This inventory leverage, coupled with our accounts receivable and accounts payable improvement was a major driver the company's improved cash conversion and operating free cash flow. Now look, as you've heard me say before, we continue to be very bullish about our U.S. business. We see strong momentum across the business and like I said before, it's sustainable and I'm going to talk to you about 4 key factors. The first factor is when you've heard me talk about before and that's the continued U.S. consumption gain. Q1 was our 11th consecutive quarter of consumption growth. Importantly, our 2-year stacked AOC consumption growth is over 20%. The second factor is our continued progress in filling in what we call our distribution wide space with our reorganized sales group. Q1 saw our AOC distribution improve by 400 basis points versus the previous quarter, highlighted by significant distribution wins with key accounts like Kroger, Publix, Wakefern, Wegman, Walmart and Target. Additionally, we saw key distribution wins at national accounts such as Whole Foods, Earth Fare and Sprouts that aren't included in that AOC measure. We also have several distribution wins that will be on shelf in Q2 and Q3 that I'm really excited to talk to you about in future calls. Third reason we feel bullish is our successful Q1 initiatives to increase production capacity on our fast-growing MaraNatha and Earth's Best pouch lines. As Irwin said, we have pretty significant cuts on those 2 lines because our demand outstripped our capacity. In the quarter, we successfully increased capacity on these the key lines by first, turning our MaraNatha Plant in Ashland, Oregon into a continuous 24/7 operation and second, installing Earth's Best pouch processing and filling capability into our West Chester facility. These 2 initiatives were executed on time and on budget. As you know, I've spoken to you in the past about the pouch installation and we'll increase our MaraNatha and Earth's Best pouch capacity by 20% and 50%, respectively. Look, I want to point out one thing. At a time when most manufacturers struggle just to bring up a single CapEx initiative, the fact that we were able to execute 2 in the space of one quarter is remarkable and a real compliment to Jim Meiers and his operations team. The final reason we are bullish about our FY '13 prospects is the continued strong response to our FY '13 innovation. We're on schedule to introduce over 100 new products, leveraging the hottest emerging trends across our key product categories. So far, the products that have gotten the strongest response, I'm going to take you through 4 quick ones here. The first one is new Celestial Seasonings' Sleepytime Snooz Natural Sleep Shots, okay? This is a great new launch that Walmart took across the chain immediately. As a matter of fact, you can go into the Walmart across the country and you can see it right now and this further extends our Sleepytime franchise, which by the way, even prior to this, Sleepytime had a 20% AOC consumption increase for the quarter. Second one I want to talk to you about this new Greek Gods Low Fat Kefir, which is a probiotics smoothie with 12 grams of protein, which extends our fast-growing Greek Gods franchise into another refrigerated segment. Third one is new Gluten-Free Café Bake Mixes, Hot Cereals and Pancake and Waffle Mixes which are targeted directly at the fast-growing gluten-free segment that Irwin talked about and will be introduced with over 10,000 points of distribution at Walmart. And finally, we're going to be introducing the new Covent Garden refrigerated soups, which as you know, are Daniels' and the U.K.'s leading brand of chilled soups and we'll be introducing them into a limited test market in the New York area as a prelude to a wider expansion in Fall 2013. These new products and many others will continue to drive distribution and consumption growth for Hain Celestial U.S. So to close, Q1 was a very strong start for Hain Celestial U.S., highlighted by top line growth, 11% AOC consumption growth, margin expansion of 67 bps, 15% operating income growth and increased operating free cash flow. And look, we are very bullish about our FY '13 prospects given the consumption trends that are continuing, our growing distribution base, our increased capacity on fast-growing MaraNatha and Earth's Best pouch lines, our strong innovation, the momentum in all of our businesses and this is before we even complete the acquisition of BluePrint, which is going to bring a great line of products and a great team to the Hain Celestial U.S. group. So we continue to be very bullish on the U.S. prospect for FY '13. So with that, I will turn over the -- throw it over to Rob. Rob?

Thanks, John. Good afternoon, everyone. The first quarter is the lowest level of activity for us here in the U.K. both in terms of sales and profits. We have very heavy weighting towards autumn and winter, therefore, Q2 and Q3. However, having said that, we had a solid first quarter with annualized like-for-like sales up over 7% and the branded highlights in that figure was new Covent Garden Soup, up 12%, Linda McCartney Frozen Meat-Free, up 14%, Cully & Sully Fresh Soup from Ireland, up 6% and Love Tub Premium Desserts, up 66%. We launched over 80 new products in the first quarter with 2/3 of them hitting in the back end of September. So we haven't really seen the benefit from those yet in the first quarter. Notable new launches though, were Linda McCartney's Chilled Meat-Free, our first venture for the Linda McCartney brand into chilled, bringing it into a whole new category in the U.K. and we commenced production of Cully & Sully fresh soups in the U.K. having transferred them from their previous co-packer in Ireland. Now a little bit more detail on the category and brand performances. Our total soup sales were up 16% in Quarter 1, led by NCG up over 12%. As I've mentioned, Cully & Sully, up over 6%. Now, our private label sales were also boosted by growth in the food service channel, which is relatively new channel for us in the group. Our frozen meat-free business overall had a very strong quarter up 17%, led by the Linda McCartney frozen category, which grew by 14%. Our Fresh-Prepared Fruit business grew by 16% in the quarter, well ahead of the category growth and the acquisition of a new customer for this business, Morrisons, is driving a lot of this growth, as well as a strong performance in the coffee shop sector. Our fresh juice had a small decline in the quarter. Our premium freshly-squeezed orange juice business suffered a bit due to very strong activity for Pepsi-Cola and Coca-Cola who are battling out in the U.K. a little bit with their Tropicana and those [ph] brands but we are very excited about the forthcoming acquisition of BluePrint. It's a great opportunity for us in the U.K. to enter a new channel and use our experience and expertise as the U.K.'s largest freshly-squeezed juice manufacturer to bring this fast-growing concept to the U.K. so we're really looking forward to meeting the team and see what we can do. Chilled desserts, again, had a very strong quarter, grew by 18% and as I mentioned earlier, that was led by the Love Tub brand, 66%, from strong new distribution gains. We also had 9% growth in our Ingredients business, which is a small B2B business but nevertheless, quite profitable. And I mentioned last quarter, some revenue synergies from the Daniels acquisition last year and just to update you on those, as I mentioned, we launched a completely new range of chilled Linda McCartney meat-free products in the quarter but in this quarter, it was only into us the Walmart. We followed that up with launches into Waitrose in late October, which has just started. And the range will then extend into Tesco and Sainsbury's. Sainsbury's in November and we are anticipating in Tesco in early January. So that means the new Linda McCartney chilled meat-free range will have very strong distribution in time for the January peak period and we're really excited about the prospects. The frozen range of the brand is outperforming the meat-free category and we're looking for very similar results in the chilled category. And we're delighted to see that the launch of the new range will be supported by a new TV campaign retelling the story of Linda McCartney to a younger audience and featuring original new music from Paul. So we think that's really going to help the business fly. So we mentioned that we're just about to launch Greek Gods SKUs in the U.K. We're really excited about this. We'll launch in Sainsbury's in over the 300 stores in November. This launch will be supported with extensive in-store tastings and POS and that will be an exclusive launch to Sainsbury's for several months before a rollout nationally in the Spring. We've commenced working now in the building of our Fakenham site for our new business that will launch there in May 2013 and the expected sale tomorrow of Daily Bread business in exchange for the Prepared Fruit business of Superior Foods will further strengthen our position in this fast-growing category. The new Fruit business will be produced fresh innovation center in Luton and will allow us to broaden our scope of operation further into this food service sector and possibly even further afield into Europe as our existing factory for prepared fruit is in the North of England and this new business will go into the South of England. During the quarter, we are to coincide with the completion of our GBP 200 million acquisition of the Premier Foods brands. We have finalized a business-wide reorganization, putting the U.K. and Ireland business into 4 operating units, led by the new Premier business, which will form Hain Daniels Grocery. We've also developed a U.K. super meals division and a U.K. food-to-go and desserts division and fourthly, of course, we have the Irish operation. The 4 operating units will be supported by group functions consisting of finance, IT, procurement, innovation, technical and HR. The restructure has been spearheaded by the appointment of 3 new managing directors to lead their respective U.K. operating units. And, of course, with the addition of the new Grocery unit, the U.K. group has a sales profile over $550 million and this new structure will give greater focus and accountability to the respective categories as we develop our leading healthy portfolio of branded fruit, veggie and meat-free solutions. Now the Premier business units, we are in the first weeks trading with our newly acquired Grocery business based in Histon, Cambridge. The transition so far is going very smoothly and the acquisition has been very welcomed by the staff. Customer response has been very positive as we have outlined our vision for the business in category over the last 4 weeks. Customers are very keen to see us reinvigorate these categories with our new ways of working extensive product innovation and investment we will bring to this portfolio of leading brands. The acquired business had a strong quarter 1 with average branded growth in volume terms, above 7%. The Hartley's Jam and Dessert brand and the Sun-Pat peanut butter brands spearheaded this growth in quarter 1 and consolidated their market-leading positions in their respective categories. As highlighted in our earnings release, we expect the business to be immediately accretive. Looking forward, we expect to complement the acquired business, the Hain Daniels Grocery unit by building up a portfolio U.S. Hain brands and U.K. Grocery, which will be managed by this new operating unit. The U.K. demand for healthier food and drink alternatives is gathering pace and we are well-positioned to capitalize on Hain U.S. and Canada experience to lead the way in the U.K. So in summary, we have exited Q1, which is a very low quarter for us in a good position. We entered our peak trading periods now with good organic growth momentum of plus 7%, which will now be augmented by the exciting additions of Hain Daniels' Grocery unit and the new Fruit business acquired in the Daily Bread sale. Thank you.

Thanks, Rob. Good afternoon, everyone. As we said in our press release, the income and EPS numbers from continuing operations are the highest in the company's history of a first quarter. Income from continuing operations in the first quarter this year was up 56.6% to record first quarter income of $19.8 million compared to $12.6 million in last year's quarter. We earned a first quarter record of $0.42 per diluted share from continuing operations on a GAAP basis this year, an increase of 50% compared to $0.28 per diluted share in last year's quarter. Adjusted income from continuing operations was $18.6 million this year, compared to $13.7 million last year, improving by 35.8%. Adjusted earnings from continuing operations were $0.40 per diluted share compared to $0.30, improving by 33.3333%. Our adjustments to net earnings are from acquisition-related expenses, including integration and restructuring charges of $600,000 and a discrete tax benefit of $1.8 million, which I'll discuss a bit later in our -- in my effective tax rate discussion. Net sales from continuing operations in the first quarter were $359.8 million, an increase of 25.4%, compared to $286.8 million last year. Net sales from discontinued operations in this quarter was $12.2 million, compared to $5.5 million last year. Therefore, total non-GAAP sales in the quarter were $372 million, compared to $292.3 million last year, up 27.3%. Sales in the quarter were equal to 22.5% of our annual guidance this year before the premier brands acquisition versus only 20.8% last year, showing strong growth in the quarter. Foreign currencies negatively impacted sales growth by $3.5 million in this year's quarter, principally coming from the decline in the euro. We saw strong increases in sales across all of our segments, coupled with sales contributed by our acquisitions. Sales from continuing operations, of course, include the recent acquisitions of Daniels, Europe's Best and Cully & Sully for the full quarter this year. Gross profit in the first quarter was 26.5% of net sales. Input cost inflation amounted to 1.1% in the first quarter this year, measured against the first quarter last year. This 1.1% was tempered by the drop in milk prices, the exclusion of which raises the inflation rate for all other ingredients to 1.4%. Inflation was offset by a better mix of sales on our pre-acquisition units and productivity improvements. Pricing has lapsed from last year and therefore, had virtually no impact in this year's quarter. We have announced a new price increase in the U.S, which went into effect after the quarter ended on October 1. Our SG&A for the quarter, excluding acquisition-related expenses and integration cost was 17.3% compared to 19% in last year's first quarter. The 166 basis point improvement comes from a combination of the lower SG&A rates at our Hain Daniels Group in the U.K. and Europe's Best in Canada. We continue to see benefits from the integration of certain functions in the U.K. into the Daniels operation and continue to focus leveraging on our existing G&A base across all of our segments. Operating income for the quarter from continuing operations was $32.3 million or 9% of net sales, compared to $23.8 million last year or 8.3% of net sales, both on a GAAP basis. On an adjusted basis, operating income was $32.9 million this year, increasing 29.8% from last year's $25.4 million. Our effective income tax rate from continuing operations was 27.7% of pretax income for the first quarter this year compared to 38% last year. This rate was adjusted to become 33.6% this year. The GAAP rate was artificially low as the result of the tax benefit from the impact of a tax rate reduction in the United Kingdom on previously recorded net deferred tax liabilities, as well as a change in mix in our worldwide income, principally the result of the Daniels acquisition with lower corporate tax rates in the U.K. Depreciation and amortization in this year's quarter was $8 million as compared to $6.3 million in the prior year, the increase coming principally from acquisitions. Stock compensation was $2.9 million, compared to $1.8 million last year. Our balance sheet continues to be strong. Our working capital was $245.2 million with a current ratio of 2.2:1. Our stockholder's equity was $1 billion for the first time. Our debt, as a percentage of equity, is 35.7% and debt to total capitalization is now a very low 26.3%. At the time of our acquisition of Daniels, we drew down $235 million of floating rate debt under our credit facility. That was in October 2011. Through September 30, 2012, we had repaid $100 million of that debt from our operating cash flows. In connection with the acquisition of the brands from Premier Foods this week, we did draw down $272 million in order to fund the cash portion of the purchase price. We continue to focus our attention on improving working capital and generating improved cash flows. For the trailing 12 months through September 30, 2012, operating free cash flow was up 23.8% to $102.1 million this year versus $82.5 million for the prior year's 12-month period. This strong increase in operating free cash flow came even with our increased capital expenditures, which amounted to $8.3 million this quarter. These capital expenditures were as expected with the projects we have undertaken and discussed in the past. Days sales outstanding was at 44, inventory days at 67 and our payables are 45 days. As a result, our cash conversion cycle is now at 66 days, a 17-day decrease as compared to September 30 year ago. Much of this decrease comes from the Daniels acquisition and the fresh nature of its product base, but significantly, cash conversion year-over-year in the United States is down 10 days. We are confirming our previously released guidance as updated to include our now completed acquisition of the Package Grocery business from Premier Foods in the U.K. Accordingly, our net sales guidance for the full fiscal year 2013 is expected to be in the range of $1.78 billion to $1.795 billion. We anticipate earnings per diluted share will come in at $2.35 to $2.45. With the acquisition of the Package Grocery business in the U.K., we see no change to our operating margin as changes in gross profit margin and SG&A rates will offset. Our updated estimates now show consolidated gross profit for the year expected to be in the 27.25% to 27.75% range. Our SG&A rate as a percentage of sales, is estimated to land at between 16.75% to 17%. We are not adjusting our estimated annual tax rate at this time, thus leaving it at 34% while we await the determination of certain tax strategies related to our recent acquisitions, principally in the U.K. The last major assumptions in our guidance are that our share count will approximate 48 million shares for the full fiscal year. Our estimates do not include any of our discontinued operations, restructurings or additional acquisition activity, including fees and expenses or potential additional acquisitions such as a Blueprint. Finally, we estimate that our earnings will continue to be somewhat seasonal with the second and third quarters being strongest of our quarters. We refer you to review our Form 10-K to obtain information about our quarterly sales and earnings trends. The quarterly data in the Form 10-K was recast to exclude the discontinued operations for each of the quarters in the 2 years that were presented in that 10-K. And as Irwin stated earlier, we're comfortable with first call estimates of our sales and earnings for the second quarter. I think Irwin said full year or didn't refer specifically -- he said first quarter, sorry. What we're saying is we are comfortable with the first quarter estimates of sales and earnings for our second quarter this year. At this point, we'll open it up for questions.

[Operator Instructions] Your first question comes from Scott Van Winkle, Canaccord Genuity.

I'll save it for follow-up. The real question I want to talk about is the U.S. market. And John, you had very good consumption growth without much price. Assuming there was some mix in there that was favorable, what you think is going to happen? Does that momentum on volume flow through to another round of price increases starting in October?

Look, I think the pricing will definitely show up in October, but I think, look, the underlying things that are driving this are distribution gains and actually, movement turned in gains. So you're going to add price to that. I think price will be not huge with the exception of nut butters, but the key is just keep driving distribution and driving movement by going deep with our best SKUs.

You mentioned the disparity between 11% growth and kind of the mass channels, the more mass channels and high single-digit in the natural channel, is that difference there? Is that the distribution gains you're seeing in the supermarket channel?

Yes.

And also Scott, just more stores out there that are selling our products, that's what it is also.

Smaller base.

Yes.

And then can you give us an idea of how big BluePrint is and is this a product that's kind of easy to take national given its a raw food product?

Well, #1, it's over $20 million in sales since 2007. 80% of the sales, Scott, are sold to home. Right now, it's in Whole Foods, basically in the Northeast. We feel we can get the shelf life up to 25 days and we ship a lot of products today with 25 days on it. There is a plant on the West Coast, there is a plant on the East Coast and there's a lot of new technology coming out today that Rob and his team have been working on in the U.K. that even could take the shelf life longer and we've just done that with soup. We're at 25 days, where we can extend the shelf life and not lose the freshness and the nutrients. And the big opportunity, I mean, from a plan standpoint, I think it's great, but from a fresh juice here that has the nutrients and one of the juices contains 6 pounds of organic vegetables, it's like a meal. So we think we really can extend it on a national basis. We think we can expand into other products. We think if we get 9 million moms a month that hit our Earth's Best website and to tie in with that with them after they have their new baby. So we just think there's a lot of opportunities and from a standpoint a lifestyle within Hain, it really will fit a lifestyle brand and a younger generation within Hain.

Your next question comes from Greg Badishkanian, Citigroup.

The sales were pretty strong this quarter, consumption was really good. Was there any -- did you notice any deviation September, October or is it pretty consistent, that strong trend that you saw from earlier in your September quarter?

Well, first of all, this is 'til the end of September. October is in our next quarter. And as John talked about consumption numbers throughout our business, remained strong in October. And one of the things we experienced, which I talked about, we're out of stocks on 2 brands and keeping up with demand there and some of that has to do with packaging, some of that just had to do with demand. But again, the 1st of November and I think what we've seen just happen in over 60 million homes and demand, we'll see good consumption growth. If any indication is orders placed for thanksgiving for turkeys for antibiotic-free it would show the demand out there. But I think Greg, the big thing is demand is one thing, but we're not sitting there just waiting for the consumer to come to the shelves. It's how are we creating new distribution, what do we do with new products and packaging? What we've done with Greek Gods and Sensible Portions, new Covent Garden soups bringing them here, what we'll do with BluePrint along with the founders and how we'll take that on a national basis. So again, it's just not waiting for the consumer to convert to natural organic. It's what are we innovating, how we gaining distribution, what are the new products, how are we doing things on a global basis and I think that's what the team is just doing a great job in.

Good. And then just with respect to thinking about margins, commodity cost going up. I think they're going up January-ish when contracts come off but you're getting pricing in October. How should we think about like, margin benefit from the pricing versus commodities over the next few quarters?

I think principally, they're going to offset, Greg. We guided to the margin that we believe we're going to have on a consolidated basis with the acquisition of the Premier brands to 27 in a quarter to 27 in 3 quarters. Obviously, when we look out on inflation and our pricing and our productivity initiatives, those are all included in that guidance. I think also you referred to commodities or inputs for January. John, I think, can speak to when it is that those changes hit us.

Greg, a lot of our commodities, organic commodities is in March, April, May is when a lot of them come out. So I think we're okay. Listen, we've seen corn come down from over $9 a bushel, we've seen soybeans, we've seen fuel, we've seen almonds from last year. So with that, we've seen them increase, we've seen them level off and on the other hand, when demand goes up, so do commodity prices.

Your next question comes from Ken Goldman, JPMorgan. Kenneth Goldman - JP Morgan Chase & Co, Research Division: Irwin, just to confirm because it got a bit tricky there. You were saying you're comfortable right now with the street estimates for sales and EPS for the current December quarter, correct?

Right. Kenneth Goldman - JP Morgan Chase & Co, Research Division: Okay. Couple other questions. Andy's said earlier this week they've never seen better U.S. demand for natural and organic foods than right now. Is that something you can say as well? I'm just curious if there's really a strong readthrough for the entire category from their results from your results. Is it better than ever or are things just still great and not necessarily accelerating in your perspective?

Well, I could come back and I look at our consumption and you've heard what John took you through our consumption and our shipments in the U.S. You've heard me take you through our Canadian business, our Europe business, and Rob took you through some of our U.K. business. Sales are good and again, I think again, difference is it's here. We're talking about numerous products, numerous categories. On a global basis, we're expanding into mass-market grocery super naturals. Whole Foods' consumption numbers are up nicely. So yes, Ken, sales are strong out there. On the other hand, we're manufacturing our products, controlling our destiny and have the availability to go out there and keep up with demand, invest in capital and CapEx to keep up with demand, which we're doing on Earth's Best, and which we're doing on MaraNatha, which we will be doing on soups, which we will be doing on BluePrint, which we're doing on Terra Chips. So listen, consumption is not -- overall food consumption is not growing, but I guarantee it is here. The consumer that sat home [Audio Gap] in the Northeast since the weekend either what they consumed in food, what had to be thrown out and what will be consumed again, I hate what happened out there, but it's good for business and eating healthy will continuously more and more. Listen, the whole thing with Prop 37 is a West Coast referendum that's being voted upon, but there's a lot of news on U.S. bases on Prop 37 and GMO-free foods. So I think yes, demand is strong out there overall in the category.

The next question comes from Ed Aaron, RBC Capital Markets.

I just wanted to follow up on Ken's question about [Audio Gap] your comfort with Q2 estimates. I'm a little confused because I think the numbers that are out there reflect a combination of analysts that have adjusted for the Premier deal and analysts that have not. Are you referring to just the analysts that have adjusted for Premier or are you just kind of looking at the total consensus number that's out there for the December quarter?

We are referring specifically to first call consensus. We are not making a commentary on any 1 group, any one analyst or group of analyst. The first call consensus gives us comfort.

And then I also wanted to make sure that I understand the Daniel seasonality properly. I think you spoke to a 7% like-for-like number in the U.K. How is Daniels treated in that number?

Well, it's blended in when you say how is it treated in that number in the U.K. Daniels is the lion's share of the U.K. business right now. We have already disposed at -- or I should say, classified as discontinued, a piece of the Daniels business that was acquired, which was the ready meals business so is not included in sales on a GAAP basis and we discontinued the sandwich business at Daily Bread, which is being sold this week. So that's also not included in the numbers that Rob was quoting or in our guidance going forward. I think that's what you were referring to.

Yes. I just wanted to make sure that you were treating that number as if you own Daniels in both periods and it sounds like you were. And then one more quick one, if I could ...

Yes, Rob was giving comparative number to what the business was year-over-year before we owned it and during our ownership.[indiscernible]

And then just one more quick one, if I could. I think you mentioned that pricing had basically no impact on the quarter because you have lapped the price increases that you took I think in June or July of 2011 but I didn't think that those price increases went all the way through until like the spring. So it's not clear to me why you wouldn't have had any pricing benefit in the quarter?

We only got based upon what our calculations show, about 30 basis points worth of pricing, which we didn't feel was worth pointing out on our prepared remarks this quarter as compared to last year's quarter. One of the things you have to remember is last year, we did not have Daniels. We're a much bigger base so the impact of pricing that may have been put through in the U.S. is not as high as it was before we had our large international expansion.

And by the way, currency in the quarter affected us by about $3.5 million, $4 million.

$3.5 million.

$3.5 million.

Your next question comes from Scott Mushkin, Jefferies and Company. Scott Andrew Mushkin - Jefferies & Company, Inc., Research Division: So just wanted to delve into a little bit of the categories in the U.S. We've heard from a number of people that -- and we see ourselves that the yogurt categories kind of get messy, a lot of price activity going on there. Greek Gods seems to be doing pretty well still or very well with the Nielsen data, but wondered to hear what may be John's plans are besides some new introductions to kind of combat what's going on in the yogurt category. The second question I have was on baby food and it looks like from some of the Nielsen data, the baby food is slowing a little bit and with maybe Plum and Alice getting more play. Wondering how you guys are adjusting to those competitive dynamics and then a third for John is snacks. Snacks seem to be taking off and I'm wondering what's going on there?

Okay. Let's start with Greek Gods. The key -- and you're right the category is getting more competitive. There's a lot of price dealing. The key point is the price dealing is happening on low-fat Greek yogurt in 6-ounce cups. The key point about Greek Gods is Greek Gods is a higher-fat, indulgent product sold in 24-ounce cups and also used as an ingredient in Mediterranean diets. This has always been a key differentiating point for this brand and that's why, look, if you put 4 or 5 SKUs of Greek Gods on the shelf, you've got enough to grow the business significantly. So we feel pretty comfortable with our positioning. We don't see anybody coming out directly at us. They're all just fighting in the 6-ounce place and moving price points on 6-ounce way down. That's why we feel good about that. On Earth's Best, our biggest SKU on Earth's Best this quarter was simply cuts because we could not get enough pouch material to make all the pouches we needed to make. We had a very significant distribution increase in Q1 on Earth's Best. We now feel -- we feel very comfortable with that as of this month with our new pouch installation that we will have the capacity we need to supply the demand on the product.

And then snack, Scott, listen our Terra Chip business is up 20% and our Garden of Eden business were up over 40%, Sensible Portions were up high-single digits. Again, it's just part of the distribution, the innovation that the guys have done out there and a perfect example is on Garden of Eden, we've now started to label the bag GMO-free and I think that is a big thing. The product is exceptional. Some of this product blues that we've come out with, some of the sweet potato products, the red hot blues, some of the sesame products and stay tuned. And then Terra Chips, which is basically not potato, basically a vegetable snack and a vegetable chip and it continues to show some of the new unique things that we come out with Sweets & Beets and some of the other new products that we come out with -- barbecued sweets, that's what the consumer wants more from an adult snack instead of eating a bag of Lay's or tired of a baked pita chip. I think the other thing just on Earth's Best, which is near and dear to my heart when I'm -- you love your kids equal but I think just what the team has done in expanding into meals, expanding into personal care, expanding into wipes, a sensitive formula for a baby's sensitive stomach and I think again, what's happening is yes, you're seeing a major transition. And what you're not seeing with Plum and Alice, they've never been in jars. We are seeing a big transition from jars into pouches. And by the way, we've now produced a majority of our own pouches and we'll continue to do that and we'll continue to invest in capital for pouches. So that's something that we'll continue to do and expand that. Scott Andrew Mushkin - Jefferies & Company, Inc., Research Division: I had 2 quick follow-up. I think you guys have the exclusive into Safeway with pouches. When does that start and is it going to move the needle? The second thing is I know on the last conference call, you guys talked about increasing the spend behind some of the marketing spend behind some of the U.S. brands and those snack numbers are just phenomenal. Is that partly because of the spend or has that not really happened yet?

Look, the snack -- look, we invested in the product, we invested in the packaging and we're driving distribution on it. In regard to Safeway, look, I don't know if it's an exclusive but I know that the Safeway pouches show up this month. [indiscernible]

I think we're the only organic pouch going in the baby food section. I don't think we have an exclusive but I think we're the only baby food pouch going in there.

Your next question comes from Bill Chappell, SunTrust.

Just a little more color on Premier foods. I'm just trying to understand the near-term trends and comparing that to the, I think there was common of high single-digit growth for the category in the U.K. right now and how long it will take to maybe get up to that level with Premier and what you're doing to close the gap?

Well, right now the brands -- and again, over 60% is the branded, 40% is private label. And that's where as Rob said, 7% of the growth is coming from the branded side of the business, Bill. And we think there's, over the next year, we can get that to double-digit and then some. Our thing is to deemphasize -- I mean, private label is good to have because you're partnered with a lot of the retailers and Premier did lose some private label business and actually, we're in the midst of getting some of it back, where some if it went to Poland and some went to some other competitors. But #1 is I feel we can get this to a high single-digit growth business. I also think with our gluten-free, with our snacks with Celestial Seasonings, with our non-dairy business, I think there's some great growth to come from that alongside with that. But we've worked on a lot of new product development, a lot more healthier, replacing sugar with honey, doing stuff with some hot categories here in chia seed pouches over there with Hartley's for kids and snacks for kids. So that's what's going to drive a lot of the growth, but I've got to tell you, growing at 7% today and no money spent behind that, I think that's pretty good.

Sure. And just I mean, is this something -- now that it just closed a week ago, is that something we can see this quarter or is it probably more 2 quarters out before we really see that, what you've done to it?

I think it's a couple quarters out because we can affect the promotions and the distribution out there. It's all set but I'll tell you what, keeping in that 7%, getting it to 9% or 10% would be a great accomplishment and I think this was really a neglected business within Premier foods and still growing at 7% shows potential.

Okay, and then just one follow-up on pricing. So is it like last year where this will layer in through quarters or will we see the full benefit of pricing this quarter?

It layers in. I mean, it will take the full year or the rest of this year to get the full benefit of it and it will layer in I mean, it's effective October 1 and it will layer out throughout the rest of the year.

It will probably layer in through the fourth quarter much like this year's first quarter didn't have much impact over last year. I expect it will take 2.5 to 3 quarters to layer in fully.

Your next question comes from Sean Naughton, Piper Jaffray.

This is actually Jared Madlin on for Sean. I had a quick question into the independent channel, which is something that's a little bit tougher for us to get a read on. I believe last quarter, you commented it was slightly outperforming the natural channel as a whole. Has that momentum kind of continued this quarter or any differences you're seeing in terms of the independent channel?

Natural independents are performing at about high single-digit growth for us at this point.

And that's what we said last and it continues at that. It's not declining nor -- and I think with a lot more Whole Foods opening up, fresh markets and other natural foods, super natural retailers and natural independence that one time were flat, I think it's great that it has grown high-single digits.

Okay. And could you maybe talk a bit about the distribution expansion in e-tailers and how you kind of think about that longer term, maybe the potential cannibalization at retail or what do you think about that? .

Think about this, the big play for us is to get to more doors and when you think about it, we're open to whether it's a bricks and mortar retailer or an e-tailer and the thing is as some folks have said, basically, you're shipping cases when you are in e-tail. That can really move the business forward. So we're very open to that. We've talked -- Amazon is a top 10 customer for us, we've said that in the past and we work hard, we see a lot of growth in e-tailers and personal care as well. So it's a huge opportunity for us, but it's all about filling in that distribution whitespace.

And our consumer, who is an educated, younger consumer who is working moms and dads, ordering online, I mean, we are following our consumers and that's what's important to us and we're seeing more and more demand for products.

And it's an entry point for new consumers to the category.

And it's interesting because you don't see that on our consumption data but our eCom today, they're -- one of the second biggest customer or one of our major customers out there for Earth's Best. So you'd continue to see more and more baby products as John said, more and more personal products and they're your buying cases. So your sale number is a lot higher.

One last quick one here now on yield. Any margin disparities there in terms of retail versus e-commerce?

No.

Your next question comes from Amit Sharma, BMO Capital.

A quick follow-up to what you said earlier about high single-digit growth in Premier. You were talking about branded, right? Not the whole...

We're talking about branded because I mean, when I think the circular come out, there was confusion in that. There was a lot -- there were some Private Label business that was lost in Tesco and some Morrisons business that was down year-over-year and also, you are coming into your highest season for that business. So that's what I'm talking about as branded.

Got it and then going back BluePrint, could you give us like, what has been the growth trajectory for that business? I'm trying to see if this business is going to become one of the Greek Gods for you?

Well, we think it can become one of the Greek Goddesses but listen, since 2007, they've grown at over $20-plus million and that's direct to home 80% of that. And today at retail, you'll find it in New York City Whole Foods and Vina Deluca and some other retailers of fresh direct. It is in some retailers on the West Coast, so if you come back and use our infrastructure like we did with Greek Gods unless the Greek Gods operators run it and there's a little -- right let the BluePrint people run it similar to the Greek Gods people -- gentleman that ran it, we think the upside is tremendous. But again, more important is it's here. The reason Greek Gods did so well, it was a great product, right packaging, right product, right ingredients, right nutrition. I came back here I mean, the Blueprint product is a phenomenal product and I think as I said, I can't emphasize enough. A lifestyle, if you want to do a cleanse, which is very healthy, higher nutrients in the product. If you come back and look at be it Walla juices or Naked juices that goes through a pasteurization or Tropicana juices, I mean again, it's not dissimilar to what canned soup is. And I think the consumer today and the younger consumer -- and one of the things that we have seen and we've looked at it, Celestial Seasonings does great in tea. If we were to take Celestial Seasonings and put it on a drink like this here, it's not the right brand for it. We really think the BluePrint brand, going after the younger consumer's lifestyle is a great brand for us to win the multiple categories and the whole raw category, is their raw yogurt, is their bars, is their snack, is their kale snacks out there, et cetera. So we really feel there's multiple opportunities for us to take it into a lot of other categories.

And Irwin, you also said gluten-free sales were up 35%. Could you give us a size of the portfolio that you have in gluten-free? I mean, what are the base for that growth?

Well if you take our gluten-free and Arrowhead Mills today and are gluten-free as DeBoles, our Gluten-Free café and then we have a lot of other products whether it's our rice meals, some of our snacks that we have over 400 products today that are gluten-free, that were labeled gluten-free, but not marketed under a gluten-free brand. And which again, we've gone out and created this from scratch within our brands. We didn't go out there and acquired a gluten-free company or anything like that. And again, we will take that gluten-free model in the U.S. and we're gluten-free now and it's just catching on in the U.K. and the same with Canada and we think from a size today, it's a $75 million to $100 million if you include all gluten-free products, at least. So we think there's big upside in that category and that business for us.

That's great. If I may ask one more for John. John, 9% total consumption growth across all channels. When we think about it, how much of that is turns versus distribution, if you are able to give us a little bit of color on that?

I mean think about it in the all -- the AOC consumption. Basically, we saw 400 basis points of growth in distribution quarter-to-quarter. Basically, I would argue to you that you're seeing about half of it in distribution and half of it in turns.

[Operator Instructions] Your next question comes from Andrew Wolf, BB&T Capital Markets. Andrew P. Wolf - BB&T Capital Markets, Research Division: John, I think -- is the 400 basis point distribution gain, is that an acceleration or is that about in line? I think you've been saying it's been about 50-50, the consumption numbers, but I'm just trying to get a sense of it because I think last quarter, you said the 12-week was 150 bps better than the 52-week, but I'm just trying to figure out is distribution still accelerating?

Andy, you're exactly right. This is definitely an acceleration from what we saw in the previous couple of quarters and it's driven by -- when you see the AOC consumption, there's a couple of big retailers that can move the needle and that's exactly what happened. We broke through on some of the key retailers in AOC and getting distribution gains on Earth's Best, Greek Gods and Gluten-Free.

Okay. And I think you've referenced -- is that more of the strategy of getting the best-selling SKUs and just sort of letting the category managers know, kind of helping them with their mindset on just selling them the top SKUs or is that broad-based including new products and so forth?

First, as we drive new distribution into the AOC channel, it's about taking our best SKUs and going deep with them for distribution. Look, some of the innovation we have, even though it hasn't proven itself in natural, these AOC retailers want it. They're going to want Greek Gods Kefir. I talked to you about Walmart taking the Sleepytime Snooz Shots. So it's primarily our best proven products, but we're also seeing a good amount of new distribution on new products. Andrew P. Wolf - BB&T Capital Markets, Research Division: Okay. And where are you at -- well, 2 things on the cuts and on the pouches, Earth's Best and the peanut -- and the butters, nut butters. Is that something you could put a dollar amount on that you weren't able to ship? And also, can you say if you've caught -- I heard you say you built some capacity but are you caught up, are you getting people in stock?

We think it was worth at least 2 points of growth in the quarter in terms of cuts. In terms of being caught up, look, right now nut butters is very hard to catch up [indiscernible] Andrew P. Wolf - BB&T Capital Markets, Research Division: I'm sorry, is that 2 points from the 8%, 8.1% or to the -- just in those categories?

No. 2 points to the total business -- total U.S. business. Andrew P. Wolf - BB&T Capital Markets, Research Division: Got it. The 8.1%, factory shipments, right?

Yes. In regard to catching up, look, we feel very comfortable that we are catching up to our demand on pouches. The challenge is nut butters right now because quite frankly, with the Sunland issues, which we are not part of, remember, we produce our own product. There is a ton of demand for -- really accelerating demand for nut butters. So we are scrambling to get as much as we can. As a matter of fact, we pulled promotions on both nut butters and pouch, Earth's Best pouch to realign our supply and our demand. We expect that our nut butters, it will probably take 'til the third quarter to get back.

And Andy, when you lose sales like this, you guys are going to reorder but if it's not at shelf and it's not at retail, you lose a customer and they'll come back, but it's just unfortunately keeping up with demand. But we will overcome it and we're not dependent on another packer to do it themselves and we'll be able to do it. Andrew P. Wolf - BB&T Capital Markets, Research Division: I just wanted to get a sense of what -- sounds like the growth would have been closer to the -- okay. And I want to switch to the U.K. and kind of very high level question at least from the way I'm looking at it. When I look at the numbers that Premiere put out in the business you bought, I would say they were running it for cash. From '09 to '11, the margin went up 200 basis points in operating margin. And so my question for you is can you maintain the profitability in the near term? I'm sure you want to grow it over time, but in the near-term, can you maintain that or do you have to invest in the brand whether with more advertising and promotion or other things in brand equity, maybe just in value or better ingredients or sometimes, from adding, just putting new products in the channel, retailers who want support. So I'm just asking if they were running this thing for cash and got near 20% margins, is that something strategically you guys can maintain or do think there is an opportunity to invest some of that against the brand to help kickstart it?

Andy, you're hiring a new brand manager over there. It sounds like you know all the things we're going to do. No, seriously, #1 is we're going to build these brands that are over 100 years old. We're going to take them into different categories and we also feel there's a lot more efficiency that we could get out of the plant that has not been taken. I mean, the old Premier management team never even visits the facilities and we think buying within our Hain Daniels Group now, we think in regards to production, they have an international business, which no one ever focused on and we think there's an opportunity there both in Europe and the U.S. and with that, we think there's a lot of dollars that from productivity, that we can invest back into the marketing of these brands. And these are well-known brands. I mean, after we announced this anybody that's lived in the U.K., spent time in the U.K. and you mentioned Hartley's, Gails Honey, Sun-Pat peanut butter and just -- we're already looking at how to take Sun-Pat into almond butters, cashew butters and nut butters and nobody's doing that. We're looking at -- we don't have a honey here in the U.S. So we are looking at opportunities that are bringing them in here. Andrew P. Wolf - BB&T Capital Markets, Research Division: Do you think if you -- if you're going to invest against the brand, is there enough -- I know it's early yet, but do you sense that there's enough inefficiencies and productivity gains within the fixed plants and the production plants and the distribution to fund that?

Andy, we feel with productivity, top line growth and running this business and part of growth in this business when we put our model together was reinvest back in it, not run it for cash. So that's our plan. With that being our last question, I want to thank everybody again, for being on this call. I know it's, like I said, a very somber day and I wish good luck to all those that have been affected by the hurricane. On the other hand, we do got to run our business and I think we're doing the -- I know we are doing a great job out there in doing it. I want to thank again, with these tough times, all the staff that really, from a Hain standpoint, that got together, pulled together to get this call off today, get our earnings together. It's amazing what we've been able to do. On Monday, we closed the Premier deal, which was one of the worst days of the year and we were able to get basically a signed agreement just to -- because we're on different times, in divesting the food-to-go business in the U.K. We've been able to get the Blueprint deal done, been able to great 4 plants back open, been able to get earnings done and in the meantime, been able to do a lot of billing and a lot of shipping over the last couple of days so it's really great to see and again, what we've been able to do on growth distribution is great. And I'm excited about the addition of BluePrint, becoming part of Hain and what we can do there and same with the U.K., congratulations to what they've done in the U.K. Rob and his team have been part of Hain for now just about a year and great growth there. Our Canadian business, great growth there. We're just going to overlap Europe's Best. And last but not least, Europe, the team in Europe, growing over 9%, close to 10% with a tough economy over there. So we're really kicking on all cylinders. Yes, do we have some challenges out there in some brands, in some categories? Absolutely. But the big difference is here, we control our destiny. There's no one customer that's more than 19% of our sales, there's no one brand that's more than 19% of our sales. Well over 50% of our products, they are manufactured by ourselves. Those that are not, we're out there purchasing the ingredients and we control the formulas. And we have dedicated sales organizations today that are calling on major supermarkets, major mass-market, major club retailers, natural food stores, Whole Foods, we have over 50 retailer -- retail team that's just going into stores, which will help get BluePrint out there. So we built tremendous infrastructure to really take Hain to the next level. And over the last couple of days, you've seen the benefit of that, it's great to see. So I want to wish everybody very healthy, happy and safe Thanksgiving. My advice is buy an antibiotic-free turkey. A Plainville one that's best and be safe out there and we're going to continuously see lots of storms. It's not the -- the world has changed in weather and thank you very much for your time this afternoon. Bye-bye.

This concludes today's conference call. You may now disconnect.