The Hain Celestial Group, Inc. (HAIN), recently reported first-quarter 2010 results. The quarterly earnings of 23 cents a share were in line with the Zacks Consensus Estimate, but fell 17.9% from 28 cents delivered in the prior-year quarter.

However, on a reported basis Incorporatedluding one-time items, quarterly earnings came in at 20 cents, and jumped 17.6% from 17 cents posted in the year-ago quarter. Management reiterated that it expects its fiscal year 2010 earnings in the range of $1.19 to $1.28 per share. The Zacks Consensus Estimate of $1.22 per share lies at the low end of the range.

Revenue for the quarter tumbled 19.6% to $230.5 million from $286.8 million reported in the prior-year quarter. The quarterly revenue was hurt by higher promotional cost, fall in personal care product sales to drug stores and foreign currency fluctuations.

Included in the prior-year quarter revenue is $38.4 million sales related to Hain Pure Protein (HPP). Excluding this, revenue for the quarter fell 7.2% year-over-year. Effective Jun 30, 2009, Hain is not incorporating HPP’s results due to the reduction in the company’s ownership interest to 48.7% from 50.1%.

Hain Pure Protein Corporation processes, markets and distributes antibiotic-free chicken and turkey products. The company expects fiscal year 2010 sales to increase in the range of 4% to 6%. Net sales are anticipated between $1 billion to $1.02 billion.

The company in order to protect its shrunken revenue base is attempting to pare its cost structure by trimming headcount, consolidating production locations and achieving optimum productivity. Gross margin expanded 280 basis points to 26.8% during the quarter.The quarterly result also benefited from 20.2% decline in the selling, general and administrative expenses.

Hain Celestial produces, distributes, markets, and sells various natural and organic foods as well as personal care products in the United States (U.S.), Canada and Europe . Despite the economic headwinds, management indicated that its U.S. operations remain strong.

The company generated free cash flow of $30.4 million in the trailing 12-month period. Hain’s balance sheet remains healthy with debt being 33.8% of shareholders’ equity of $716.1 million. During the quarter, the company lowered its debt by $16.3 million.

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