- Mark Schiller was named the new president and CEO of Hain Celestial, succeeding founder Irwin Simon, according to a company statement. Schiller, who was most recently executive vice president and chief commercial officer of Pinnacle Foods, takes the helm of the company on Nov. 5. He will be nominated to the company's board of directors at the annual shareholder meeting on Dec. 5.
- With more than a quarter century in the CPG industry, Schiller has served in many leadership roles. At Pinnacle, he was responsible for overseeing the grocery and frozen segments. In this role, he lead functions including sales, strategy, research and development, consumer insights and marketing. Hain said Schiller was able to bring about a turnaround to Pinnacle, growing sales, profits and market share.
- Executives were excited about what Schiller brings to Hain Celestial. "Under Mark's leadership, Hain Celestial will accelerate its business transformation through the execution of our four-point strategic plan investing in top brands and capabilities to grow globally, delivering on Project Terra cost savings, continually enhancing leadership across the organization, and building upon our enviable position as a leader in organic, natural and better-for-you products, to create sustainable, long-term value for our stockholders," Andrew Heyer, Hain Celestial's lead director, said in a release.
Since consumer interest in the organic and better-for-you food space picked up a few years ago, Hain Celestial has been a perpetual topic of M&A discussion — and financial difficulty and interest from an activist investor have only stoked the fire. Rumors of a takeover swirled more after Simon announced in June he was stepping down from the leadership of the company he founded in 1993.
With Schiller coming to take over, Hain Celestial gets an experienced executive. But considering Schiller's last job was working as one of the architects for a turnaround that ended in a major acquisition, the rumor mill is unlikely to quiet down. In a deal that closed last week, Pinnacle Foods was purchased by Conagra Brands for $10.9 billion in cash and stock.
Regardless of Hain Celestial's future plans, the company was in dire need of a leader who excels in transformation. Since major accounting errors were first disclosed in 2016, Hain Celestial has been on the tough path of trying to find growth and profitability. Amid a formal investigation from the Securities and Exchanges Commission, the company has been trying to pull through. Last year, activist investor Engaged Capital took a 9.9% stake in the company. As part of a deal reached last year between the CPG company and the activist investor, three Hain Celestial board members agreed not to run for re-election. The company appointed six new directors — including Glenn Welling, founder, principal and chief investment officer of Engaged Capital.
While the deal might have satisfied the activist investor at the time, Hain Celestial's financial performance has plenty to agitate even ardent company backers. In its most recent earnings report, revenues were at $616.6 million — an increase of 3% from a year ago on paper, but a decrease of 0.9% on a constant currency basis. One of the major reasons for the disappointing quarter was a 6% drop in U.S. sales.
A major initiative toward profitability is Project Terra, Hain Celestial's SKU rationalization project. In an earnings report earlier this year, the company stated it wants to concentrate on its top 500 products in the U.S., a move intended to increase its margins in the long run. And while those decreases are creating an additional pull on sales, the latest earnings reports show that it still hasn't benefited Hain Celestial's bottom line.
While Hain Celestial's product line may need new attention, it now has a leader with experience in revving up slow sales. At Pinnacle, Schiller worked on the teams that were able to reinvigorate sales — both through product innovation and smart M&A. Pinnacle had a large frozen foods portfolio, and was able to get brands including Birds Eye, Hungry-Man, Evol and Van de Kamp's into the sweet sales spot by using new ideas to target convenience-seeking millennial consumers. Another perpetual bright spot in Pinnacle's earnings was the better-for-you items acquired when the company bought Boulder Brands for $975 million in 2015.
So is Schiller coming to Hain Celestial to please the investors, or to prime the company for a potential sale? It's uncertain what the future holds. However, as part of least year's deal with Engaged Capital, the company formed a group of directors to examine strategic alternatives — including a potential sale. According to a New York Post report in January, the company, which has extremely diverse products ranging from personal care items to snacks, was having problems selling itself. Nestlé was reportedly in talks about an acquisition, but they went nowhere; the company reportedly wanted Hain Celestial to first divest its meat division.
Schiller's own words in the company statement also do not show any long-term intent — aside from making much-needed improvements. Regardless of the long-term plans, investors on Monday seemed pleased. Hain Celestial's stock was up nearly 6% in mid-morning trading to $25.61 a share.