Hain: Contracts kept Plainville Farms from shutting down

Executives from Hain Celestial said as the diversified natural and organic products company seeks to get into a better financial position, shutting down some of its business units is an option.

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(Hain Celestial)
(Hain Celestial)

Executives from Hain Celestial said as the diversified natural and organic products company seeks to get into a better financial position, shutting down some of its business units is an option.

However, the company, which just divested of its Plainville Farms turkey business by selling it to a group of investors that formed the company Plainville Brands LLC, said that closing Plainville Farms would not have been a desirable option due to contractual obligations. Plainville Farms was a part of Hain Celestial’s Hain Pure Protein (HPP) subsidiary, which the company announced about a year ago would be for sale. The company announced the sale of Plainville Farms on February 22.

“Contractual obligations on things make it challenging,” Hain Celestial CEO Mark Schiller said while speaking at the company’s investor day on February 27. “HPP was a good example, on the Plainville business that we just exited. We had long-term contracts that made it very difficult to shut that brand down if we wanted to, even though we were losing money.”

Schiller has been the CEO of Hain Celestial since October 2018. He succeeded the company’s founder, Irwin Simon, who had several months earlier announced his intent to retire as the CEO.

Other Hain Pure Protein assets

While HPP’s turkey operations’ financial results have been dismal in recent months, the company’s chief financial officer, James Langrock, painted a different picture for Hain’s chicken brands, Empire Kosher and FreeBird.

Hain still seeks to sell those operations, and Langrock said they will do well for a potential buyer.

“Now that we have exited the Plainville business, the Empire Kosher and FreeBird chicken business is very profitable, consistent, profit growth and cash-flow positive,” said Langrock. “There’s a lot of interest right now, so we’re going through the sale process.”

HPP was founded in 2004 as a way for Hain Celestial to grow and enter the protein market. Simon had earlier said HPP grew from a $8 million business to a $500 million business.

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