Kate Grafstein

Kate Grafstein inquired about how the current dislocation impacts the launch of METHODIQ, given planned increased spending in H1 and its expected effect on EBITDA margins.

Answer

Oran Holtzman, Co-founder and CEO, Oddity Tech, explained that because METHODIQ is relatively small, it can continue to grow without experiencing the same negative effects seen in larger brands like IL MAKIAGE and SpoiledChild. He confirmed that the company expects to meet its targets for METHODIQ this year.

Kate Grafstein of Barclays asked for a comparison of performance in the professional channel between the U.S. and international markets, and questioned what might be driving a potential positive inflection outside the U.S.

Answer

CEO Amanda Baldwin stated that the company does not break out performance by geography within channels but noted that international trends are largely consistent with North America, suggesting U.S. strategies should translate well globally. COO & CFO Catherine Dunleavy added that due to the transformation, year-to-date trends are more indicative than quarterly results and that the company is actively renegotiating international distributor contracts.

Katie Grafstein questioned whether the strategy to reduce promotional intensity in the DTC channel would be applied to other channels and asked for commentary on the overall promotional environment in the U.S. and internationally.

Answer

CEO Amanda Baldwin clarified the strategy is not to eliminate promotions but to use them more surgically during key 'tentpole' moments across all channels, creating a coherent omnichannel approach. CFO Catherine Dunleavy added that the company's full-year guidance provides the flexibility to adjust promotional activity based on market dynamics and ROI.

Kate Grafstein inquired about the Scent business, asking why Fragrance Ingredients growth was so strong in the quarter and what the outlook is for 2025, and also asked for the growth expectation for Fine Fragrances and if it is expected to normalize.

Answer

CFO Michael DeVeau explained that the strong double-digit growth in Fragrance Ingredients was driven by a successful strategy to target high-value ingredients. He anticipates this growth will moderate in 2025 due to tougher comparisons and some price deflation. For Fine Fragrance, which saw high single-digit growth, he expects growth to continue into 2025 based on new business wins and expansion in emerging markets. CEO Jon Erik Fyrwald added that overall industry dynamics for Scent remain favorable, driven by its importance in consumer products and growing consumer interest in fine fragrances.

Katie Grafstein inquired about the continued weakness in Edgewell's Fem Care sales, the progress of consolidating the portfolio under the Carefree brand, and the potential for improvement from upcoming spring resets.

Answer

President and CEO Rod Little acknowledged that the weakness is concentrated in the pads segment, where transitioning consumers from the legacy Stayfree brand to the Carefree master brand is taking longer than anticipated. He expects sequential improvement from easier comparisons and ongoing conversion efforts. COO Daniel Sullivan added that the Carefree brand itself is performing well, with growth in both liners and pads, and that marketing is being activated to support the consumer transition.