Hain Celestial shares dropped by 25% after the company announced that it will delay the release of its financial results. The company separately announced that it did not expect to make its anticipated sales and profits numbers for the year.
Hain Celestial shares dropped by 25% after the organic and natural products company announced that it will delay the release of its fourth quarter and fiscal year 2016 financial results. The company separately announced that it did not expect to make its anticipated sales and profits numbers for the year.During the fourth quarter, the company said it identified concessions that were granted to certain distributors in the United States, and it is currently evaluating whether the revenue associated with those concessions was accounted for in the correct period. Hain also said it is currently evaluating its internal control over financial reporting. The Audit Committee of the company's board of directors is conducting an independent review of these matters and has retained independent counsel to assist in that review.Previously, Hain said it has recognized revenue pertaining to the sale of its products to certain distributors at the time the products are shipped to such distributors. The company is evaluating whether the revenue associated with the concessions granted to certain distributors should instead have been recognized at the time the products sell through its distributors to the end customers. The company expects that any potential changes in the timing of the recognition of revenue with respect to these transactions should not impact the total amount of revenue ultimately recognized by the Hain with respect to such distributors and does not reflect on the validity of the underlying transactions with respect to such distributors.Hain said it will not be in a position to release financial results until the completion of the independent review of the Audit Committee and of the audit process relating to the 2016 fiscal year.