Edgewell's Q1 2025: Contradictions in Fem Care Performance, Supply Chain Recovery, and FX Impact

These are the key contradictions discussed in Edgewell Personal Care's latest 2025Q1 earnings call, specifically including: Fem Care Performance, Supply Chain Recovery and Impact, FX Impact on Financials, FemCare Sales Performance and Strategy, and Impact of Supply Chain Issues on Business Recovery:



Organic Sales and Market Performance:
- Edgewell reported a 1.3% decrease in organic net sales for Q1 fiscal 2025 compared to the previous year, with international markets showing a 2% growth and North America experiencing a 4% decline.
- The growth in international markets was driven by price and volume gains, particularly in Wet Shave, Sun Care, and Grooming categories. However, the decline in North America was mainly due to lower volumes in Wet Shave and Fem Care.

Financial Outlook and Currency Impact:
- Edgewell revised its full-year outlook due to currency movements, expecting a 160 basis points negative impact on reported sales and a 70% hit on adjusted earnings per share, primarily due to a strengthening U.S. dollar.
- Despite these challenges, the company maintains its outlook for organic net sales, adjusted EBITDA, and adjusted earnings per share within the previously provided ranges, assuming no material deterioration in macro conditions.

Operational Performance and Transformation:
- Edgewell achieved an 80 basis points increase in constant currency gross margin, driven by productivity savings of 340 basis points and strong operational execution, including improved service levels and inventory management.
- The company attributed its operational improvements to ongoing efforts in cost management, enterprise efficiency, and strategic investments in international markets and innovation.

International Growth Drivers:
- Edgewell's international business reported a 2% organic growth in Q1, marking the fifth consecutive quarter of growth, with notable success in leading Sun Care markets like Australia and Mexico, and high-growth Wet Shave markets like China.
- This growth was supported by the rebuilding of the innovation platform, leading to successful product launches and increased market share in key regions.