KVUE 8-K
Kenvue Inc. (KVUE)
8-K
2025-05-08
For: 2025-05-05
View Original
Added on
April 12, 2026
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): May 5, 2025
(Exact name of registrant as specified in its charter)
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of incorporation)
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Registrant’s telephone number, including area code: (908 )-874-1200
Not applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Securities registered pursuant to Section 12(b) of the Act:
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of
the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised
financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition
On May 8, 2025, Kenvue Inc. issued the attached press release (Exhibit 99.1) announcing its financial results for the fiscal first quarter ended March 30, 2025.
The information contained under Item 2.02 in this Current Report on Form 8-K, including Exhibit 99.1, is being furnished and, as a result, such information shall not be
deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing
under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers
On May 8, 2025, the Company announced the appointment of Amit Banati as Kenvue’s Chief Financial Officer, which is expected to be effective May 12, 2025 (Mr. Banati’s
start date, the “Effective Date”).
Mr. Banati, age 56, currently serves as Vice Chairman and Chief Financial Officer of Kellanova (formerly Kellogg Company), a leading company in global snacking,
international cereal, noodles and frozen foods. He began serving in this role in December 2022. Prior to that position, he was Senior Vice President and Chief Financial Officer of Kellogg Company from July 2019 to December 2022. Mr. Banati joined
Kellogg Company in March 2012 as President, Asia Pacific, and his responsibilities were expanded to President, Asia Pacific, Middle East and Africa in July 2018. Before joining Kellogg Company, Mr. Banati served in a variety of finance, general
management and board roles at Kraft Foods, Cadbury Schweppes and Procter & Gamble. Mr. Banati currently serves on the board of directors of Fortune Brands Innovations.
In connection with Mr. Banati’s appointment, Mr. Banati and the Company executed an offer letter on May 5, 2025 (the “Offer Letter”). The Offer Letter provides for a base
salary of $900,000, eligibility for an annual bonus target of 110% of Mr. Banati’s base salary, annual equity award grants with an aggregate target value of $3.2 million, and that Mr. Banati will be an “Eligible Employee” for purposes of the
Executive Severance Pay Plan of Kenvue Inc. and U.S. Affiliated Companies (the “Severance Plan”). Mr. Banati’s 2025 equity grant will be granted at the target value and consist of the same types of awards, with the same vesting terms, as for
Kenvue’s other executive officers. Mr. Banati will be subject to the Company’s standard restrictive covenant agreement, which includes restrictions relating to non-competition, non-solicitation, and protection of confidential information.
The Company agreed to provide Mr. Banati with the following awards: (1) a cash bonus of $2,500,000, paid shortly after the Effective Date; (2) an award of RSUs with a
fair market value of $4,000,000, granted within two months of the Effective Date; (3) a cash bonus of $4,000,000, paid upon the closing of the merger transaction between Mars Inc. and Kellanova (the “Transaction”), if such closing occurs no later
than August 13, 2026 (the “Transaction Condition”); and (4) an award of RSUs with a fair market value of $2,500,000, granted within two months of the satisfaction of the Transaction Condition. The equity awards will vest over a three-year period
following the applicable grant date. The cash-based awards will generally be subject to 100% repayment if Mr. Banati terminates employment prior to the first anniversary of the Effective Date and 50% repayment if Mr. Banati terminates employment
prior to the second anniversary of the Effective Date.
The Offer Letter further provides that if Mr. Banati’s employment with Kenvue terminates (1) due to death or “disability”, (2) by Mr. Banati for “good reason” or (3) by
the Company other than for “significant misconduct” (as such terms are defined in the Offer Letter), then: (i) any requirement to repay the cash sign-on awards will no longer apply; (ii) the equity sign-on awards will vest in full upon death or
disability and will otherwise be subject to continued vesting; and (iii) if the Transaction Condition is satisfied after such termination, Mr. Banati will receive any sign-on compensation that is subject to achievement of the Transaction Condition.
The foregoing description of the Offer Letter does not purport to be complete and is qualified in its entirety by reference to the Offer Letter, a copy of which is
attached as Exhibit 10.1 hereto and incorporated herein by reference.
There are no family relationships, as defined in Item 401 of Regulation S-K, between Mr. Banati and any of Kenvue’s executive officers or directors or persons nominated
or chosen by Kenvue to become a director or executive officer. There have been no transactions since the beginning of the Company’s last fiscal year, and there are no currently proposed transactions, in which the Company was or is to be a
participant and in which Mr. Banati, or any member of his immediate family, had or will have any interest, that are required to be reported under Item 404(a) of Regulation S-K. There is no arrangement or understanding between Mr. Banati and any
other person pursuant to which Mr. Banati was appointed as an officer of the Company.
On May 8, 2025, the Company also announced that Paul Ruh, currently Kenvue’s Chief Financial Officer, will cease to serve as Chief Financial Officer on the Effective
Date (the “CFO Transition”). Mr. Ruh will remain with the Company in a strategic advisor role through May 16, 2025, to assist with the transition of his duties. The CFO Transition, with respect to Mr. Ruh, meets the conditions of the separation
without “cause” provisions of the Severance Plan and Mr. Ruh’s long-term incentive awards. Accordingly, subject to his execution of a release of claims in favor of the Company and its affiliates and his continuing compliance with his restrictive
covenant obligations, Mr. Ruh will receive the severance payments and benefits payable under the Severance Plan and his long-term incentive awards will be treated in accordance with the terms of the applicable award agreements.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits.
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Exhibit Number
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Exhibit Description
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104
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The cover page from this Current Report on Form 8-K, formatted in Inline XBRL.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly
authorized.
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KENVUE INC.
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Date: May 8, 2025
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By:
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/s/ Edward J. Reed
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Name:
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Edward J. Reed
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Title:
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Vice President, Corporate Secretary
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Exhibit 10.1
May 5, 2025
Mr. Amit Banati
[address redacted]Dear Amit:
I am pleased to confirm the offer to join Kenvue as Chief Financial Officer. I am confident that your extensive experience and impressive skills make you an invaluable
addition to our leadership team. Your expected start date is May 12, 2025 and your employer of record will be Kenvue Brands LLC (together with its parent and affiliates, the “Company”). Kenvue’s corporate headquarters in Summit, NJ will be your
primary work location. Capitalized terms used but not defined herein shall have the meaning ascribed to such term in Exhibit A attached hereto.
The following represents our offer of employment to you:
Compensation
Since you will be designated an Executive Officer of the Company, the grant of all compensation, including the amount, structure, and other terms, is at the discretion of
the Compensation & Human Capital Committee (“CHCC”) of the Board of Directors of Kenvue Inc. (the “Board”), subject to their approval and contingent upon individual and Company performance. The continuation of any compensation or benefits
program is subject to the CHCC’s and/or the Company’s discretion. For purposes of clarity, this offer letter has been approved by the CHCC.
Your 2025 annual bonus and LTI grants and Sign-On Bonus and New Hire Equity Award (each as defined below), and all related underlying documentation, will be provided by
the Company and granted with terms that, in each case, are consistent with the terms of this offer letter in all respects.
Your annualized gross base salary, which will be paid bi-weekly, will be $900,000.00 (less applicable deductions and withholdings).
Our annual cash performance bonus rewards for individual and corporate performance throughout a performance year. You will be eligible to earn a non-prorated award for
the 2025 performance year in accordance with the terms of the 2025 bonus plan applicable to the Company’s Named Executive Officers (the “NEOs”) generally, subject to Kenvue and individual performance, assuming a start date no later than June 30,
2025. Your bonus target will be 110% of your base salary. You are generally only eligible to receive a bonus if you remain employed at the end of the
performance year in accordance with the Company’s Annual Performance Bonus Policy (the “Bonus Policy”), except as may be provided otherwise under the Company’s Executive Severance Plan or other applicable policy. Similar to other NEOs, 70% of your
target bonus is based on Kenvue performance goals established on an annual basis by the CHCC that are consistent with the goals applicable to the NEOs, and 30% is based on individual performance goals established and evaluated on an annual basis in
good faith by the CHCC.
Your annual long-term incentive (“LTI”) target is $3,200,000. Annual LTI grants
are generally made in March of each year. You will be eligible for a non-prorated 2025 annual LTI grant, assuming a start date no later than June 30, 2025 (the “2025 LTI Grant”). The 2025 LTI Grant is scheduled to be made as soon as is practicable,
but no later than two months after your start date with the Company, if you are employed on the grant date and not serving any notice of termination.
Executive Officer annual LTI currently comprises 50% Performance Share Units (“PSUs”),
30% Stock Options, and 20% Restricted Share Units (“RSUs”). PSUs are scheduled to vest three years from the grant date, subject to the grant terms and the Company’s performance over the applicable performance period, which shall be consistent with the terms provided to the NEOs. We will share additional details on performance requirements after your start date. Stock options and RSUs vest
ratably over a three-year period with the first vesting on the first anniversary of the grant date. See the enclosed brochure for more details on Executive Long-Term Incentives. All unvested LTI grants are subject to forfeiture upon termination in
accordance with the terms of the Kenvue Inc. Long-Term Incentive Plan (the “LTIP”) and/or equity award agreement(s), provided, that the award agreements for your 2025 LTI Grant will be substantially the same as those used for other NEOs, including
provisions relating to your termination of employment and treatment in connection with a Change of Control.
Sign-On Consideration
Sign-On Bonus:
Provided you sign and return the enclosed Sign-On Bonus Repayment Agreement, you will be eligible to receive the following cash sign-on bonuses, less applicable
withholdings: an initial bonus of $2,500,000 payable on the first practicable payroll date following your start date (the “Initial Bonus”) and a contingent bonus of $4,000,000 (the “Contingent Bonus” and together with the Initial Bonus, the
“Sign-On Bonus”). The Contingent Bonus is contingent on the Kellanova Transaction Closing occurring no earlier than your start date with Kenvue and no later than August 13, 2026 and, if payable, will be payable (subject to the repayment obligation
described below) on the first practicable payroll date following the Kellanova Transaction Closing, provided such closing occurs on or after your start date with Kenvue and on or before August 13, 2026, unless your employment with the Company is
terminated prior to such payment date and such termination is not a Qualifying Termination. For the avoidance of doubt, (x) you will remain entitled to receive the Contingent Bonus if you experience a Qualifying Termination before the Kellanova
Transaction Closing and (y) you will forfeit any right to be paid the Contingent Bonus in the event (A) of your termination, and such termination is not a Qualifying Termination, before the Kellanova Transaction Closing or (B) the Kellanova
Transaction Closing does not occur on or after your start date with Kenvue and on or before August 13, 2026.
If your employment is terminated and such termination is not a Qualifying Termination, you will be required to reimburse the Company for the following portion of the
Sign-On Bonus to the extent paid to you prior to such termination: (1) 100% of the Sign-On Bonus if such termination is prior to the first anniversary of your start date and (2) 50% of the Sign-On Bonus if such termination is on or after the first
anniversary, and prior to the second anniversary, of your start date. For the avoidance of doubt, in the event you have a Qualifying Termination following a Change of Control of the Company, then you will not be required to reimburse the Company
for any portion of the Sign-On Bonus.
New Hire Equity Award:
You will be eligible for two new hire RSU awards, to be granted as follows: an initial RSU award with a fair market value of $4,000,000, to be granted as soon as
practicable (but no later than two months) after your start date (the “Initial Equity”), and an additional RSU award with a fair market value of $2,500,000, to be granted as soon as practicable (but no later than two months) after the Kellanova
Transaction Closing, provided such closing occurs on or after your start date with Kenvue and on or before August 13, 2026 (the “Contingent Equity” and together with the Initial Equity, the “New Hire Equity Award”). You will forfeit any right to be
awarded the Contingent Equity in the event (i) of a termination that is not a Qualifying Termination before the Kellanova Transaction Closing or (ii) the Kellanova Transaction Closing does not occur on or after your start date with Kenvue and on or
before August 13, 2026.
The Initial Equity will vest ratably on each of the first three anniversaries of the grant date, with the first vesting on the first anniversary of the grant date, and
the Contingent Equity will vest ratably on each of the first three anniversaries of the grant date, with the first vesting on the first anniversary of the grant date. All unvested LTI grants are subject to forfeiture upon termination in accordance
with the terms of the LTIP and/or equity award agreement(s). Notwithstanding the foregoing, in the event your termination was (a) (1) by the Company other than for Significant Misconduct, or (2) by you for Good Reason, any portion of the New Hire
Equity Award that has been granted and not yet vested at the time of such termination will continue to vest in accordance with the terms of your award agreement and (b) due to death or Disability, any portion of the New Hire Equity Award that has
been granted and not yet vested at the time of such termination will immediately accelerate and vest in full.
Notwithstanding the foregoing, in the event that Kenvue (or any successor or its parent) is unwilling or unable to grant you RSUs or similar equity-based awards with
respect to shares that are publicly tradeable on a national exchange that are subject to a valid registration statement on Form S-8, including as a result of your incurring a Qualifying Termination prior to the Kellanova Transaction Closing (which
occurs on or after your start date with Kenvue and on or before August 13, 2026), other than as a result of temporary circumstances, then in lieu of the Contingent Equity, you will be paid a cash bonus of $2,500,000 as soon as practicable following
the date the Contingent Equity is earned.
Compensation Recoupment
You will be subject to any clawback or recoupment provisions as may be required by applicable lawas or Company policies in effect from time to time, including the
Company’s Compensation Recoupment Policy for Significant Misconduct and the Incentive Compensation Recovery Policy.
Relocation
Our offer includes a relocation package, administered under the terms of the Company’s current relocation policy afforded to NEOs. A summary of relocation benefits is
enclosed. The relocation benefits are available to you until one year after your start date.
Should you voluntarily terminate your employment or your employment is terminated for Cause within 24 months of the official move date, you will be required to reimburse
the Company for costs paid on your behalf associated with your relocation package. The terms of repayment are outlined in the Relocation Agreement, included with this offer letter. If you accept our offer, and accept relocation benefits, you are
required to sign the Relocation Agreement and return it with your signed offer letter. As explained, and without limiting the below, your employment is “at will” and the Relocation Agreement is not a contract of employment nor does it imply that
your employment will continue for any period of time or confer any rights with respect to the duration of employment or the terms and conditions thereof.
Severance Benefits
Effective as of your start date, you will be deemed an Eligible Employee and entitled to participate in the Executive Severance Pay Plan.
Offer Requirements
This offer is contingent upon:
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Satisfactory results of background checks, and satisfaction of any legal pre-conditions/requirements to the Company’s ability to employ you in the United States.
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Proper and complete submission of:
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The Personal Information Form and background release form(s) required by the Company.
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Prior to your commencement of employment with the Company, you must sign and return the Company’s Employee Secrecy, Intellectual Property, Non-Competition, and Non-Solicitation
Agreement (the “Restrictive Covenant Agreement”). Please be aware that, in addition to, among other things, prohibiting your disclosure of the Company’s confidential information, we expect you to retain in confidence and not disclose or use
in your employment with us any confidential information you have obtained from your present or previous employer(s). Please return the signed Restrictive Covenant Agreement with your signed offer letter.
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Invitation to Self-Identify
As a Federal contractor subject to Section 503 of the Rehabilitation Act of 1973 and the Vietnam-era Veterans Readjustment Assistance Act of 1974 and the Veterans
Employment Opportunity Act of 1998, we are required to extend to applicants a post-offer invitation to self-identify as a Vietnam-era veteran, or veteran covered by the Veterans Employment Opportunities Act of 1998. Enclosed is an invitation to
self-identify. Providing this information is voluntary and will be kept confidential in accordance with the law. Choosing not to provide it will not have an adverse impact on employment. This information will be used only in accordance with our
equal employment opportunity policy.
Benefits
Our flexible benefits program includes medical, dental, life, and accident coverage for employees and family members, for which coverage begins on the first day of
employment, as well as a 401K Plan. As an Executive Officer, you will be elibile to participate in the employee benefit plans, and receive any applicable perquisites, that are generally made availabe to other Executive Officers.
Work Life Services
Feel free to take advantage of our Work Life Services offered through Optum. Optum Work Life Services help employees balance their work, family, and personal
responsibilities by providing confidential consultation regarding childcare, eldercare, self-care, and education. If you call Optum (1-800-765-6806), identify yourself as the recipient of an offer of employment from Kenvue.
Personal Information Notice
We are committed to protecting the personal information of our employees. The enclosed Personal Information Notice explains how we collect, use and disclose Personal
Information collected from our employees.
The Company maintains an employment-at-will relationship with its employees. This means that both you and the Company retain the right to terminate this employment
relationship at any time with or without cause or notice. All salary, bonuses, allowances and other payments and benefits referred to in this letter will be considered normal income and will be subject to applicable state and Federal income taxes.
This offer letter constitutes our complete offer. Any promises or representations, either oral or written, not contained in this letter and the documents referred to
herein, are not valid and are not binding on the Company. This offer letter will be binding upon the later of (1) your execution and return of the offer letter and (2) approval of your appointment and this offer letter by the Board and CHCC.
Once binding in accordance with the foregoing, this offer letter will also be binding on any of the permitted successors and assigns of the Company.
We are pleased to offer you this position, and we are looking forward to your joining Kenvue. You will have 2 days in which to return your acceptance. Please signify
your acceptance of this offer of employment by signing and returning this document by May 7 via secure email. If you have any questions, please contact me.
Sincerely,
Luani Alvarado
Agreed & Accepted:
| /s/ Amit Banati |
05/05/2025 |
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*Applicant’s signature or (printed name if by email)
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Date
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*Note: The Company accepts electronic signatures on Applications for Employment and offer letters. If you choose to use an electronic signature to accept this offer, you
acknowledge and agree to the following:
“I understand that – pursuant to the Electronic Signature in Global and National Commerce Act – returning the signed offer letter from my e-mail account shall have the
same legal effect and validity with respect to the acknowledgments set forth above as my handwritten signature.”
Kenvue Brands LLC recognizes electronic signature for offer acceptance as valid provided that the E-mail account used to return the offer acceptance, and the E-mail
account noted on the applicant’s Employment Application (or for internal employees their online bid application) are identical.
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Cc:
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Anil Agarwal
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Alla Berenshteyn
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Maria Beatriz Henning Sampaio
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Matt Sandler
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Exhibit A
Definitions
“Cause” shall have the meaning ascribed to such term under the LTIP.
“Change in Control” shall have the meaning ascribed to such term under LTIP.
“Disability” shall have the meaning ascribed to such term under LTIP.
“Good Reason” means the occurrence of one or more of the following, without your
written consent: (i) a greater than 10% decrease in your base salary, other than where such reduction is part of a broad-based compensation reduction applicable to similarly situated employees; (ii) a 50% or more reduction (as determined by the
CHCC’s sole discretion) in your authorities, responsibilities and duties; or (iii) your assigned primary work address is changed (or company designated fully remote alternate work arrangement is terminated) resulting in an increase in your one-way
commuting distance by 50 or more miles from your primary home residence to the new assigned primary work address (with such commuting distance to be determined by using Google Maps); provided, in each case, that such events shall not constitute
Good Reason unless you provide written notice to the Company of the occurrence of such event within 30 days of the occurrence of such event and the Company does not cure such event within 30 days after receipt of such notice, and you terminate
employment within 30 days after the end of such cure period.
“Kellanova Transaction” means the merger transaction between Mars, Inc. and Kellanova
“Kellanova Transaction Closing” means the closing of the Kellanova Transaction.
“Qualifying Termination” means any termination of your employment with the Company either
(i) due to your death or Disability, (ii) by the Company other than for Significant Misconduct, or (iii) by you for Good Reason.
“Severance Plan” means the Executive Severance Pay Plan of Kenvue Inc. and U.S. Affiliated
Companies.
“Significant Misconduct” shall have the meaning ascribed to such term under the Kenvue Inc.
Compensation Recoupment Policy for Significant Misconduct.
Exhibit 99.1
Kenvue Reports First Quarter 2025 Results
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Net Sales (3.9)%; Organic Sales1 (1.2)%
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Maintains Focus On Accelerating Profitable Growth and Optimizing Cost Structure, While Successfully Completing TSA Exits
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Updates Outlook for FY’25 for Incremental Tariff Costs and Currency
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SUMMIT, N.J. May 8, 2025 – Kenvue Inc. (NYSE: KVUE) today
announced financial results for the first quarter ended March 30, 2025.
“In Q1, our teams executed our plans while continuing to navigate an evolving macro and consumer environment,” said Thibaut Mongon, Chief Executive
Officer. “We are committed and focused on activating our brands while staying agile and flexible to accelerate sustainable profitable growth.”
First Quarter Summary
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Net sales decreased 3.9% vs the prior year period, reflecting Organic sales decline of 1.2% and foreign currency headwind of 2.7%.
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Gross profit margin was 58.0% vs 57.6% in the prior year period. Adjusted gross profit margin1 contracted 20 basis points vs the prior year period to
60.0%.
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Operating income margin was 14.9% vs 14.1% in the prior year period. Adjusted operating income margin1 was 19.8% vs 22.0% in the prior year period.
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Diluted earnings per share were $0.17 vs $0.15 in the prior year period; Adjusted diluted earnings per share1 were $0.24 vs $0.28 in the prior year period.
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In April, the Company achieved a major milestone in its Separation, as it successfully completed Transition Services Agreement (“TSA”) exits.
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The Company is updating its outlook for Full Year 2025 to reflect the impact of incremental costs associated with tariffs and current foreign exchange rates.
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First Quarter 2025 Financial Results
Net Sales and Organic Sales
First quarter 2025 Net sales decreased 3.9% vs the prior year period, reflecting Organic
sales decline of 1.2% and foreign currency headwind of 2.7%. Organic sales decline was driven by unfavorable value realization of 0.3%, reflecting planned
strategic price investments, and 0.9% volume decline.
Gross Profit Margin and Operating Income Margin
First quarter 2025 Gross profit margin expanded 40 basis points to 58.0% from 57.6% in the prior year period, as Separation-related costs (as defined below) and amortization of intangible assets decreased year-over-year. Adjusted gross profit margin
declined 20 basis points to 60.0% from 60.2% in the prior year period. The year-over-year change in both measures reflects the impact from productivity gains attributable to our global supply chain optimization initiatives, which were offset by
volume deleveraging, foreign exchange and inflationary headwinds, as well as strategic price investment.
First quarter 2025 Operating income margin was 14.9% vs 14.1% in the prior year period, with the prior year figure impacted by non-cash charges related
to asset impairment. First quarter 2025 Adjusted operating income margin was 19.8% vs 22.0% in the prior year period. The year-over-year changes in Operating income margin and Adjusted operating income margin reflect the year-over-year change in
Gross profit margin and Adjusted gross profit margin, respectively, as well as an increase in brand investment, which more than offset the benefit from savings from Our Vue Forward.
Interest Expense, Net and Taxes
First quarter 2025 Interest expense, net was $94 million vs $95 million in the prior year period.
First quarter Effective tax rate was 29.7% vs 30.7% in the prior year period. The Adjusted effective tax rate1 was 27.5% vs 28.3% in the
prior year period.
Net Income Per Share (“Earnings Per Share”)
First quarter 2025 Diluted earnings per share were $0.17 vs $0.15 in the prior year period and Adjusted diluted earnings per share were $0.24 vs $0.28 in the prior
year period.
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2025 Outlook
Kenvue updated its outlook for Full Year 2025 to reflect current foreign exchange rates, as well as the estimated impact from higher costs due to tariffs in place as of
May 7, 2025. The Company expects:
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Net sales increase of +1% to +3% year-over-year, with Organic sales growth of +2% to +4% (unchanged) and a ~1% headwind from foreign currency translation.
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Adjusted operating income margin decline year-over-year, reflecting the estimated impact of tariffs.
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Adjusted diluted earnings per share about flat year-over-year, including a low-single-digit unfavorable impact from foreign currency.
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The Company is working to reduce the financial impact of tariffs through a number of mitigation actions.
Kenvue is not able to provide the most directly comparable GAAP measures or reconcile Adjusted operating income margin or Adjusted diluted earnings per
share to comparable GAAP measures on a forward-looking basis without unreasonable efforts given the unpredictability of the timing and amounts of discrete items such as foreign exchange, acquisitions, or divestitures.
In a separate press release this morning, the Company announced a Chief Financial Officer transition effective May 12, 2025. Additional details regarding
this transition can be found at investors.kenvue.com.
Webcast Information
Kenvue will host a conference call with investors to discuss its first quarter
results on Thursday, May 8, 2025 at 8:00 a.m. Eastern Time. The conference call can be accessed by dialing 877-407-8835 from the U.S. or +1 201-689-8779 from international locations. A live webcast of the conference call can also be accessed at investors.kenvue.com, with a replay made available after the live event.
About Kenvue
Kenvue Inc. is the world’s largest pure-play consumer health company by revenue. Built on more than a century of heritage, our iconic brands, including Aveeno®,
BAND-AID® Brand, Johnson’s®, Listerine®, Neutrogena®, and Tylenol®, are science-backed and recommended by healthcare professionals around the world. At Kenvue, we realize the extraordinary power
of everyday care. Our teams work every day to put that power in consumers’ hands and earn a place in their hearts and homes. Learn more at kenvue.com.
1Non-GAAP Financial Measures
The Company uses certain non-GAAP financial measures to supplement the financial measures prepared in accordance with U.S. GAAP. There are limitations to
the use of the non-GAAP financial measures presented herein. These non-GAAP financial measures are not prepared in accordance with U.S. GAAP nor do they have any standardized meaning under U.S. GAAP. In addition, other companies may use similarly
titled non-GAAP financial measures that are calculated differently from the way the Company calculates such measures. Accordingly, the non-GAAP financial measures may not be comparable to such similarly titled non-GAAP financial measures used by
other companies. The Company cautions you not to place undue reliance on these non-GAAP financial measures, but instead to consider them with the most directly comparable U.S. GAAP measure. These non-GAAP financial measures have limitations as
analytical tools and should not be considered in isolation. These non-GAAP financial measures should be considered supplements to, not substitutes for, or superior to, the corresponding financial measures calculated in accordance with U.S. GAAP.
3
The Company believes the presentation of these measures is relevant and useful for investors because it allows investors to view performance in a manner
similar to the method used by management. The Company believes these measures help improve investors’ ability to understand the Company’s operating performance and makes it easier to compare the Company’s results with other companies. In addition,
the Company believes these measures are also among the primary measures used externally by the Company’s investors, analysts, and peers in its industry for purposes of valuation and comparing the operating performance of the Company to other
companies in our industry.
Below are definitions and the reconciliation to the most closely related GAAP measures for the non-GAAP measures used in this press release and the
related prepared materials and webcast.
Adjusted diluted earnings per share: We define Adjusted diluted earnings per
share as Adjusted net income divided by the weighted average number of diluted shares outstanding. Management views this non-GAAP measure as useful to investors as it provides a supplemental measure of the Company’s performance over time.
Adjusted EBITDA margin: We define EBITDA as U.S. GAAP Net income adjusted
for interest, provision for taxes, and depreciation and amortization. We define Adjusted EBITDA as EBITDA adjusted for restructuring expenses and operating model optimization initiatives, costs incurred in connection with our establishment as a
standalone public company (“Separation-related costs”), conversion of stock-based awards, stock-based awards granted to individuals employed by Kenvue as of October 2, 2023 (“Founder Shares”), impairment charges, the impact of the deferred transfer
of certain assets and liabilities from Johnson & Johnson in certain jurisdictions (the “Deferred Markets”), and losses on investments. We define Adjusted EBITDA margin as Adjusted EBITDA as a percentage of U.S. GAAP Net sales. Management believes
this non-GAAP measure is useful to investors as it provides a supplemental perspective to the Company’s operating efficiency over time.
Adjusted effective tax rate: We define Adjusted effective tax rate as U.S.
GAAP Effective tax rate adjusted for the tax effects on special item adjustments including amortization of intangible assets, restructuring expenses and operating model optimization initiatives, Separation-related costs, conversion of stock-based
awards, Founder Shares, impairment charges, and losses on investments. We also exclude taxes related to the Deferred Markets. Management believes this non-GAAP measure is useful to investors as it provides a supplemental measure of the Company’s
performance over time.
4
Adjusted gross profit margin: We define Adjusted gross profit margin (also
referred to as “Adjusted gross margin”) as U.S. GAAP Gross profit margin adjusted for amortization of intangible assets, Separation-related costs, conversion of stock-based awards, Founder Shares, and operating model optimization initiatives.
Management believes this non-GAAP measure is useful to investors as it provides a supplemental perspective to the Company’s operating efficiency over time.
Adjusted net income: We define Adjusted net income as U.S. GAAP Net income
adjusted for amortization of intangible assets, restructuring expenses and operating model optimization initiatives, Separation-related costs, conversion of stock-based awards, Founder Shares, impairment charges, the impact of the Deferred Markets,
losses on investments, and their related tax impacts (i.e. special items). Adjusted net income excludes the impact of items that may obscure trends in our underlying performance. Management believes this non-GAAP measure is useful to investors as the
Company uses Adjusted net income for strategic decision making, forecasting future results, and evaluating current performance.
Adjusted operating income: We define Adjusted operating income as U.S. GAAP
Operating income adjusted for amortization of intangible assets, restructuring expenses and operating model optimization initiatives, Separation-related costs, conversion of stock-based awards, Founder Shares, impairment charges, and the impact of
the Deferred Markets. Management believes this non-GAAP measure is useful to investors as management uses Adjusted operating income to assess the Company’s financial performance.
Adjusted operating income margin: We define Adjusted operating income margin
(also referred to as “Adjusted operating margin”) as Adjusted operating income as a percentage of U.S. GAAP Net sales. Management believes this non-GAAP measure is useful to investors as it provides a supplemental perspective to the Company’s
operating efficiency over time.
Free cash flow: We define Free cash flow as U.S. GAAP Net cash flows from
operating activities adjusted for Purchases of property, plant, and equipment. Management believes this non-GAAP measure is useful to investors as it provides a view of the Company’s liquidity after deducting capital expenditures, which are
considered a necessary component of our ongoing operations.
Organic sales: We define Organic sales as U.S. GAAP Net sales excluding the
impact of changes in foreign currency exchange rates and the impact of acquisitions and divestitures. We report changes in Organic sales on a period-over-period basis. Management believes reporting period-over-period changes in Organic sales provides
investors with additional, supplemental information that is useful in assessing the Company’s results of operations by excluding the impact of certain items that we believe do not directly reflect our underlying operations.
5
Cautions Concerning Forward-Looking Statements
This press release contains “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995 regarding, among other
things, statements about management’s expectations of Kenvue’s future operating and financial performance, product development, market position, and business strategy. Forward-looking statements may be identified by the use of words such as “plans,”
“expects,” “will,” “anticipates,” “estimates,” and other words of similar meaning. The reader is cautioned not to rely on these forward-looking statements. These statements are based on current expectations of future events. If underlying assumptions
prove inaccurate or known or unknown risks or uncertainties materialize, actual results could vary materially from the expectations and projections of Kenvue and its affiliates. Risks and uncertainties include, but are not limited to: the inability
to execute on Kenvue’s business development strategy; inflation and other economic factors, such as interest rate and currency exchange rate fluctuations, as well as existing or proposed tariffs and other constraints on trade both in the U.S. and in
foreign markets; the ability to successfully manage local, regional, or global economic volatility, including reduced market growth rates, and to generate sufficient income and cash flow to allow Kenvue to effect any expected share repurchases and
dividend payments; Kenvue’s ability to maintain satisfactory credit ratings and access capital markets, which could adversely affect its liquidity, capital position, and borrowing costs; competition, including technological advances, new products,
and intellectual property attained by competitors; challenges inherent in new product research and development; uncertainty of commercial success for new and existing products and digital capabilities; challenges to intellectual property protections
including counterfeiting; the ability of Kenvue to successfully execute strategic plans, including Our Vue Forward and other restructuring or cost-saving initiatives; the impact of business combinations and divestitures, including any ongoing or
future transactions; manufacturing difficulties or delays, internally or within the supply chain; product efficacy or safety concerns resulting in product recalls or regulatory action; significant adverse litigation or government action, including
related to product liability claims; changes to applicable laws and regulations and other requirements imposed by stakeholders; changes in behavior and spending patterns of consumers; natural disasters, acts of war, or terrorism, catastrophes, or
epidemics, pandemics, or other disease outbreaks; financial instability of international economies and legal systems and sovereign risk; the inability to realize the benefits of the separation from Kenvue’s former parent, Johnson & Johnson; and
the risk of disruption or unanticipated costs in connection with the separation. A further list and descriptions of these risks, uncertainties, and other factors can be found in Kenvue’s filings with the Securities and Exchange Commission, including
its most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q and other filings, available at kenvue.com or on request from Kenvue. Any forward-looking statement made in this release speaks only as of the date of this
release. Kenvue undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events, or developments or otherwise.
Contacts
Investor Relations:
Sofya Tsinis
Media Relations:
Melissa Witt
6
Kenvue Inc.
Condensed Consolidated Statements of Operations
(Unaudited; Dollars In Millions, Except Per Share Data; Shares In Millions)
|
|
Fiscal Three Months Ended
|
|||||||
|
March 30, 2025
|
March 31, 2024
|
|||||||
|
Net sales
|
$
|
3,741
|
$
|
3,894
|
||||
|
Cost of sales
|
1,573
|
1,652
|
||||||
|
Gross profit
|
2,168
|
2,242
|
||||||
|
Selling, general and administrative expenses
|
1,537
|
1,573
|
||||||
|
Restructuring expenses
|
60
|
41
|
||||||
|
Impairment charges
|
—
|
68
|
||||||
|
Other operating expense, net
|
13
|
10
|
||||||
|
Operating income
|
558
|
550
|
||||||
|
Other expense, net
|
6
|
28
|
||||||
|
Interest expense, net
|
94
|
95
|
||||||
|
Income before taxes
|
458
|
427
|
||||||
|
Provision for taxes
|
136
|
131
|
||||||
|
Net income
|
$
|
322
|
$
|
296
|
||||
|
Net income per share
|
||||||||
|
Basic
|
$
|
0.17
|
$
|
0.15
|
||||
|
Diluted
|
$
|
0.17
|
$
|
0.15
|
||||
|
Weighted-average number of shares outstanding
|
||||||||
|
Basic
|
1,914
|
1,915
|
||||||
|
Diluted
|
1,925
|
1,920
|
||||||
7
Organic
Sales Change
The following table presents a reconciliation of the change in Net sales, as reported, to the change in Organic sales, a non-GAAP measure for the periods
presented:
|
Fiscal Three Months Ended March
30, 2025 vs March 31, 2024
|
||||||||||||||||||||||||
|
(Unaudited)
|
Reported Net
sales change
|
Impact of foreign currency
|
Acquisitions and divestitures
|
Organic sales change
|
||||||||||||||||||||
|
Total
Organic sales change
|
Price/Mix(1)
|
Volume
|
||||||||||||||||||||||
|
Self Care
|
(1.8
|
) %
|
(2.1
|
) %
|
—
|
%
|
0.3
|
%
|
0.3
|
%
|
—
|
%
|
||||||||||||
|
Skin Health and Beauty
|
(7.3
|
)
|
(2.3
|
)
|
(0.2
|
)
|
(4.8
|
)
|
(1.9
|
)
|
(2.9
|
)
|
||||||||||||
|
Essential Health
|
(3.9
|
)
|
(3.9
|
)
|
—
|
—
|
0.1
|
(0.1
|
)
|
|||||||||||||||
|
Total
|
(3.9
|
) %
|
(2.7
|
) %
|
—
|
%
|
(1.2
|
) %
|
(0.3
|
) %
|
(0.9
|
) %
|
||||||||||||
| (1) |
Price/Mix reflects value realization. |
Total Segment Net Sales and Adjusted Operating Income
Segment Net sales for the periods presented were as follows:
|
Net Sales
|
||||||||
|
Fiscal Three Months Ended
|
||||||||
|
(Unaudited; Dollars in Millions)
|
March 30, 2025
|
March 31, 2024
|
||||||
|
Self Care
|
$
|
1,667
|
$
|
1,698
|
||||
|
Skin Health and Beauty
|
977
|
1,054
|
||||||
|
Essential Health
|
1,097
|
1,142
|
||||||
|
Total segment net sales
|
$
|
3,741
|
$
|
3,894
|
||||
8
Segment Adjusted operating income for the periods presented was as follows:
|
Adjusted Operating Income
|
||||||||
|
Fiscal Three Months Ended
|
||||||||
|
(Unaudited; Dollars in Millions)
|
March 30, 2025
|
March 31, 2024
|
||||||
|
Self Care Adjusted operating income
|
$
|
566
|
$
|
601
|
||||
|
Skin Health and Beauty Adjusted operating income
|
92
|
146
|
||||||
|
Essential Health Adjusted operating income
|
239
|
264
|
||||||
|
Total(1)
|
$
|
897
|
$
|
1,011
|
||||
|
Reconciliation to Adjusted operating income (non-GAAP):
|
||||||||
|
Depreciation(2)
|
73
|
75
|
||||||
|
General corporate/unallocated expenses
|
79
|
87
|
||||||
|
Other operating expense, net
|
13
|
10
|
||||||
|
Other—impact of Deferred Markets
|
(9
|
)
|
(16
|
)
|
||||
|
Adjusted operating income (non-GAAP)
|
$
|
741
|
$
|
855
|
||||
|
Reconciliation to Income before taxes:
|
||||||||
|
Amortization of intangible assets(3)
|
63
|
74
|
||||||
|
Separation-related costs(4)
|
38
|
67
|
||||||
|
Restructuring expenses and operating model optimization initiatives(5)
|
67
|
50
|
||||||
|
Conversion of stock-based awards
|
3
|
22
|
||||||
|
Other—impact of Deferred Markets
|
9
|
16
|
||||||
|
Founder Shares
|
3
|
8
|
||||||
|
Impairment charges(6)
|
—
|
68
|
||||||
|
Operating income
|
$
|
558
|
$
|
550
|
||||
|
Other expense, net
|
6
|
28
|
||||||
|
Interest expense, net
|
94
|
95
|
||||||
|
Income before taxes
|
$
|
458
|
$
|
427
|
||||
| (1) |
Effective in the fiscal three months ended June 30, 2024, the Company adjusted the allocation for certain Research and development costs within Selling, general, and administrative expenses to align with segment financial results as measured by the Company, including the chief operating decision maker. Accordingly, the Company has updated its segment disclosures to reflect the updated presentation in all prior periods. Total Adjusted operating income did not change as a result of this update. |
| (2) | Depreciation consists of depreciation of property, plant, and equipment and amortization of integration and development costs capitalized in connection with cloud computing arrangements. |
| (3) | Relates to the amortization of definite-lived intangible assets (primarily trademarks, trade names, and customers lists) over their estimated useful lives. |
| (4) |
Separation-related costs relate to non-recurring costs incurred in connection with our establishment of Kenvue as a standalone public company. Separation-related costs are composed of the following:
|
|
Fiscal Three Months Ended
|
||||||||
|
(Unaudited; Dollars in Millions)
|
March 30, 2025
|
March 31, 2024
|
||||||
|
Information technology and other
|
$
|
33
|
$
|
60
|
||||
|
Legal entity name change
|
5
|
7
|
||||||
|
Total Separation-related costs
|
$
|
38
|
$
|
67
|
||||
| Information technology and other costs primarily relates to the disentanglement of systems and the costs associated with the discontinuation of certain information technology assets. We expect the Separation-related costs will continue through approximately the first half of fiscal year 2025. |
| (5) |
Restructuring expenses and operating model optimization initiatives, which relate to the 2024 Multi-Year Restructuring Initiative, are composed of the following: |
|
Fiscal Three Months Ended
|
||||||||
|
(Unaudited; Dollars in Millions)
|
March 30, 2025
|
March 31, 2024
|
||||||
|
Employee-related costs (one-time severance and other termination benefits)
|
$
|
25
|
$
|
35
|
||||
|
Information technology and project-related costs
|
40
|
13
|
||||||
|
Other implementation costs
|
2
|
2
|
||||||
|
Total Restructuring expenses and operating model optimization initiatives
|
$
|
67
|
$
|
50
|
||||
| (6) |
Impairment charges for the fiscal three months ended March 31, 2024 relate to the impact of a $68 million non-cash impairment charge recorded on the held for sale asset associated with the Company’s former corporate headquarters in Skillman, New Jersey. |
9
Non-GAAP Financial Information
The following tables present reconciliations of GAAP to Non-GAAP for the periods presented:
|
Fiscal Three Months Ended March 30, 2025
|
|||||||||||||||||||||
|
(Unaudited; Dollars in Millions)
|
As
Reported
|
Adjustments
|
Reference
|
As
Adjusted
|
|||||||||||||||||
|
Net sales
|
$
|
3,741
|
—
|
|
$
|
3,741
|
|||||||||||||||
|
|
|
||||||||||||||||||||
|
Gross profit
|
$
|
2,168
|
77
|
(a)
|
$
|
2,245
|
|||||||||||||||
|
Gross profit margin
|
58.0
|
%
|
|
60.0
|
%
|
||||||||||||||||
|
|
|
||||||||||||||||||||
|
Operating income
|
$
|
558
|
183
|
(a)-(c)
|
$
|
741
|
|||||||||||||||
|
Operating income margin
|
14.9
|
%
|
|
19.8
|
%
|
||||||||||||||||
|
|
|
||||||||||||||||||||
|
Net income
|
$
|
322
|
143
|
(a)-(d)
|
$
|
465
|
|||||||||||||||
|
Net income margin
|
8.6
|
%
|
|
12.4
|
%
|
||||||||||||||||
|
Interest expense, net
|
$
|
94
|
|
||||||||||||||||||
|
Provision for taxes
|
$
|
136
|
|
||||||||||||||||||
|
Depreciation and amortization
|
$
|
136
|
|
||||||||||||||||||
|
EBITDA (non-GAAP)
|
$
|
688
|
120
|
(b)-(c), (e)
|
$
|
808
|
|||||||||||||||
|
EBITDA margin (non-GAAP)
|
18.4
|
%
|
|
21.6
|
%
|
||||||||||||||||
|
Detail of Adjustments
|
Cost of sales
|
SG&A/Restructuring expenses
|
Other operating expense, net
|
Provision for taxes
|
Total
|
|||||||||||||||
|
Amortization of intangible assets
|
$
|
63
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
63
|
||||||||||
|
Restructuring expenses
|
—
|
60
|
—
|
—
|
60
|
|||||||||||||||
|
Operating model optimization initiatives
|
6
|
1
|
—
|
—
|
7
|
|||||||||||||||
|
Separation-related costs (including conversion of stock-based awards and Founder
Shares)
|
8
|
36
|
—
|
—
|
44
|
|||||||||||||||
|
Impact of Deferred Markets—minority interest expense
|
—
|
—
|
4
|
—
|
4
|
|||||||||||||||
|
Impact of Deferred Markets—provision for taxes
|
—
|
—
|
5
|
(5
|
)
|
—
|
||||||||||||||
|
Tax impact on special item adjustments
|
—
|
—
|
—
|
(35
|
)
|
(35
|
)
|
|||||||||||||
|
Total
|
$
|
77
|
$
|
97
|
$
|
9
|
$
|
(40
|
)
|
$
|
143
|
|||||||||
|
(a)
|
(b)
|
(c)
|
(d)
|
|||||||||||||||||
|
Cost of sales less amortization
|
$
|
14
|
||||||||||||||||||
|
|
(e)
|
|||||||||||||||||||
10
|
|
Fiscal Three Months Ended March 31, 2024
|
||||||||||||||||||||
|
(Unaudited; Dollars in Millions)
|
As
Reported
|
Adjustments
|
Reference
|
As
Adjusted
|
|||||||||||||||||
|
Net sales
|
$
|
3,894
|
—
|
|
$
|
3,894
|
|||||||||||||||
|
|
|
||||||||||||||||||||
|
Gross profit
|
$
|
2,242
|
103
|
(a)
|
$
|
2,345
|
|||||||||||||||
|
Gross profit margin
|
57.6
|
%
|
|
60.2
|
%
|
||||||||||||||||
|
|
|
||||||||||||||||||||
|
Operating income
|
$
|
550
|
305
|
(a)-(d)
|
$
|
855
|
|||||||||||||||
|
Operating income margin
|
14.1
|
%
|
|
22.0
|
%
|
||||||||||||||||
|
|
|
||||||||||||||||||||
|
Net income
|
$
|
296
|
251
|
(a)-(f)
|
$
|
547
|
|||||||||||||||
|
Net income margin
|
7.6
|
%
|
|
14.0
|
%
|
||||||||||||||||
|
Interest expense, net
|
$
|
95
|
|
||||||||||||||||||
|
Provision for taxes
|
$
|
131
|
|
||||||||||||||||||
|
Depreciation and amortization
|
$
|
149
|
|
||||||||||||||||||
|
EBITDA (non-GAAP)
|
$
|
671
|
262
|
(b)-(e), (g)
|
$
|
933
|
|||||||||||||||
|
EBITDA margin (non-GAAP)
|
17.2
|
%
|
|
24.0
|
%
|
||||||||||||||||
| Detail of Adjustments |
Cost of sales
|
SG&A/Restructuring expenses
|
Impairment charges
|
Other operating expense, net
|
Other expense, net
|
Provision for taxes
|
Total
|
|||||||||||||||||||||
|
Amortization of intangible assets(1)
|
$
|
74
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
74
|
||||||||||||||
|
Restructuring expenses(2)
|
—
|
41
|
—
|
—
|
—
|
—
|
41
|
|||||||||||||||||||||
|
Operating model optimization initiatives(2)
|
6
|
3
|
—
|
—
|
—
|
—
|
9
|
|||||||||||||||||||||
|
Separation-related costs (including conversion of stock-based awards and Founder
Shares)(3)
|
23
|
74
|
—
|
—
|
—
|
—
|
97
|
|||||||||||||||||||||
|
Impairment charges(4)
|
—
|
—
|
68
|
—
|
—
|
—
|
68
|
|||||||||||||||||||||
|
Impact of Deferred Markets—minority interest expense
|
—
|
—
|
—
|
7
|
—
|
—
|
7
|
|||||||||||||||||||||
|
Impact of Deferred Markets—provision for taxes
|
—
|
—
|
—
|
9
|
—
|
(9
|
)
|
—
|
||||||||||||||||||||
|
Losses on investments(5)
|
—
|
—
|
—
|
—
|
31
|
—
|
31
|
|||||||||||||||||||||
|
Tax impact on special item adjustments
|
—
|
—
|
—
|
—
|
—
|
(76
|
)
|
(76
|
)
|
|||||||||||||||||||
|
Total
|
$
|
103
|
$
|
118
|
$
|
68
|
$
|
16
|
$
|
31
|
$
|
(85
|
)
|
$
|
251
|
|||||||||||||
|
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
|||||||||||||||||||||||
|
Cost of sales less amortization
|
$
|
29
|
||||||||||||||||||||||||||
|
(g)
|
||||||||||||||||||||||||||||
| (1) |
Relates to the amortization of definite-lived intangible assets (primarily trademarks, trade names, and customers lists) over their estimated useful lives. |
11
| (2) |
Restructuring expenses and operating model optimization initiatives, which relate to the 2024 Multi-Year Restructuring Initiative, are composed of the following: |
|
|
Fiscal Three Months Ended
|
|||||||
|
(Unaudited; Dollars in Millions)
|
March 30, 2025
|
March 31, 2024
|
||||||
|
Employee-related costs (one-time severance and other
termination benefits)
|
$
|
25
|
$
|
35
|
||||
|
Information technology and project-related costs
|
40
|
13
|
||||||
|
Other implementation costs
|
2
|
2
|
||||||
|
Total Restructuring expenses and operating model optimization initiatives
|
$
|
67
|
$
|
50
|
||||
| (3) |
Separation-related costs relate to non-recurring costs incurred in connection with our establishment of Kenvue as a standalone public company. Separation-related costs, including the impact of the conversion of stock-based
compensation awards and the incremental stock-based compensation from the issuance of the Founder Shares, are composed of the following:
|
|
Fiscal Three Months Ended
|
||||||||
|
(Unaudited; Dollars in Millions)
|
March 30, 2025
|
March 31, 2024
|
||||||
|
Information technology and other
|
$
|
33
|
$
|
60
|
||||
|
Legal entity name change
|
5
|
7
|
||||||
|
Separation-related costs
|
$
|
38
|
$
|
67
|
||||
|
Conversion of stock-based awards
|
3
|
22
|
||||||
|
Founder Shares
|
3
|
8
|
||||||
|
Total
|
$
|
44
|
$
|
97
|
||||
| Information technology and other costs primarily relates to the disentanglement of systems and the costs associated with the discontinuation of certain information technology assets. We expect the Separation-related costs will continue through approximately the first half of fiscal year 2025. | |
| (4) |
Impairment charges for the fiscal three months ended March 31, 2024 relate to the impact of a $68 million non-cash impairment charge recorded on the held for sale asset associated with the Company’s former corporate headquarters in Skillman, New Jersey. |
| (5) |
Relates to impairment charges incurred to write off a portion of the Company’s equity investment balance. |
12
The following table presents reconciliations of the Effective tax rate, as reported, to Adjusted effective tax rate for the periods presented:
|
Fiscal Three Months Ended
|
||||||||
|
(Unaudited)
|
March 30, 2025
|
March 31, 2024
|
||||||
|
Effective tax rate
|
29.7
|
%
|
30.7
|
%
|
||||
|
Adjustments:
|
||||||||
|
Tax-effect on special item adjustments
|
(2.4
|
)
|
(3.1
|
)
|
||||
|
Taxes related to Deferred Markets
|
0.2
|
0.7
|
||||||
|
Adjusted Effective tax rate (non-GAAP)
|
27.5
|
%
|
28.3
|
%
|
||||
The following table presents a reconciliation of Effective tax rate, as forecasted on a U.S. GAAP basis, to forecasted Adjusted effective tax rate for
fiscal year 2025:
|
Fiscal
Year 2025
|
||||
|
(Unaudited)
|
Forecast
|
|||
|
Effective tax rate
|
28.5% - 29.5
|
%
|
||
|
Adjustments:
|
||||
|
Tax-effect on special item adjustments
|
(3.2
|
)
|
||
|
Taxes related to Deferred Markets
|
0.2
|
|||
|
Adjusted Effective tax rate (non-GAAP)
|
25.5% - 26.5
|
%
|
||
The following table presents a reconciliation of Diluted earnings per share, as reported, to Adjusted diluted earnings per share for the periods presented:
|
Fiscal Three Months Ended
|
||||||||
|
(Unaudited)
|
March 30, 2025
|
March 31, 2024
|
||||||
|
Diluted earnings per share
|
$
|
0.17
|
$
|
0.15
|
||||
|
Adjustments:
|
||||||||
|
Separation-related costs
|
0.02
|
0.03
|
||||||
|
Restructuring expenses and operating model
optimization initiatives
|
0.03
|
0.03
|
||||||
|
Impairment charges
|
—
|
0.04
|
||||||
|
Amortization of intangible assets
|
0.03
|
0.04
|
||||||
|
Losses on investments
|
—
|
0.02
|
||||||
|
Tax impact on special item adjustments
|
(0.02
|
)
|
(0.04
|
)
|
||||
|
Other
|
0.01
|
0.01
|
||||||
|
Adjusted diluted earnings per share (non-GAAP)
|
$
|
0.24
|
$
|
0.28
|
||||
13
The following table presents a reconciliation of Net cash flows from operating activities, as reported, and Purchases of property, plant, and equipment, as
reported, to Free cash flow for the periods presented:
|
Fiscal Three Months Ended
|
||||||||
|
(Unaudited; Dollars in Billions)
|
March 30, 2025
|
March 31, 2024
|
||||||
|
Net cash flows from operating activities
|
$
|
0.4
|
$
|
0.3
|
||||
|
Purchases of property, plant, and equipment
|
(0.2
|
)
|
(0.2
|
)
|
||||
|
Free cash flow (non-GAAP)
|
$
|
0.2
|
$
|
0.1
|
||||
Other Supplemental Financial Information
The following table presents the Company’s Net sales by geographic region for the periods presented:
|
Fiscal Three Months Ended
|
||||||||
|
(Unaudited; Dollars in Millions)
|
March 30, 2025
|
March 31, 2024
|
||||||
|
Net sales by geographic region
|
||||||||
|
North America
|
$
|
1,857
|
$
|
1,873
|
||||
|
Europe, Middle East, and Africa
|
884
|
905
|
||||||
|
Asia Pacific
|
694
|
766
|
||||||
|
Latin America
|
306
|
350
|
||||||
|
Total Net sales by geographic region
|
$
|
3,741
|
$
|
3,894
|
||||
The following table presents the Company’s Research and development expenses for the periods presented. Research and development expenses are included
within Selling, general, and administrative expenses.
|
Fiscal Three Months Ended
|
||||||||
|
(Unaudited; Dollars in Millions)
|
March 30, 2025
|
March 31, 2024
|
||||||
|
Research & Development
|
$
|
99
|
$
|
100
|
||||
The following table presents the Company’s Cash and cash equivalents, Total debt, and Net debt balance as of the periods presented:
|
(Unaudited; Dollars in Billions)
|
March 30, 2025
|
December 29, 2024
|
||||||
|
Cash and cash equivalents
|
$
|
1.1
|
$
|
1.1
|
||||
|
Total debt
|
(8.7
|
)
|
(8.6
|
)
|
||||
|
Net debt
|
$
|
(7.7
|
)
|
$
|
(7.5
|
)
|
||
Note: Numbers may not foot due to rounding
14
Exhibit 99.2
Kenvue Announces Chief Financial Officer Transition
| ● |
Amit Banati, 30-Year Consumer Products Company Finance and Operations Veteran, Appointed CFO
|
| ● |
Succeeds Paul Ruh, Effective May 12, 2025
|
SUMMIT, N.J., May 8, 2025 –
Kenvue Inc. (NYSE: KVUE), today announced the appointment of Amit Banati as the Company’s Chief Financial Officer, effective May 12, 2025. He will be responsible for overseeing the Finance and Strategy functions, supporting initiatives aimed at
accelerating profitable growth and delivering value to shareholders. Following a thorough and thoughtful search process, Mr. Banati will succeed Paul Ruh, who will remain with the Company for a brief period to help ensure a smooth transition.
Mr. Banati is a 30-year consumer products company finance and operations veteran, having served most recently as Vice Chairman and Chief Financial Officer of Kellanova (previously
Kellogg Company), and holding finance and operating leadership roles at Kraft Foods (now Mondelez International), Cadbury Schweppes and Procter & Gamble. He has significant experience overseeing operations outside the U.S., including in Asia
Pacific, the Middle East, India and Africa, and has successfully delivered profitable growth and executed enterprise-wide business transformations.
“We are thrilled to welcome Amit to Kenvue and look forward to leveraging his deep industry expertise and business transformation experience as we continue to focus on accelerating
Kenvue’s profitable growth and delivering value for shareholders,” said Thibaut Mongon, Chief Executive Officer. “With much of the work to establish Kenvue as an independent company completed and our strengthened commercial and operational
foundations in place, now is the right time for a CFO transition. Amit is a world-class executive with a proven track record across both financial and operational roles and the ideal person to further support our efforts to work differently and move
faster and lead our Finance and Strategy organizations into the future.”
“I am excited to join Kenvue with its global scale and portfolio of iconic consumer health brands,” Mr. Banati said. “My focus as CFO will be supporting revenue growth through stronger
data management and resource allocation, driving continued margin and cost profile improvement efforts, strengthening cash flow, and fostering greater agility, including better integrated business planning and improved financial forecasting. With the
talented Kenvuers around the world, we can maximize benefits of the Company’s increased brand investments and accelerate growth across Self Care, Skin Health and Beauty, and Essential Health to create sustainable value for shareholders.”
Mr. Mongon added, “On behalf of the entire organization and our Board of Directors, I thank Paul for his many contributions in helping execute one of the largest separations in public
company history to establish Kenvue as a standalone leader in consumer health. He stood up the Our Vue Forward transformation program and helped shape our P&L to allow us to invest more behind our brands, setting the stage for accelerated
growth. We wish Paul all the best in his next chapter.”
In a separate press release this morning, the Company announced financial results for the fiscal first quarter ended March 30, 2025. Additional details regarding the Company’s earnings
results can be found at investors.kenvue.com.
About Amit Banati
Most recently, Mr. Banati served as Vice Chair and Chief Financial Officer at Kellanova (Kellogg), where he was responsible for all financial operations and led strategy and business
development, including M&A and a venture capital fund. As CFO at Kellogg (2019-2022), he led the business through a period of significant transformation, implementing and evolving the company’s Deploy For Growth strategy, which enabled Kellogg’s
return to sustainable, profitable growth. And as Region President at Kellogg (2012-2019), he was the driving force behind the transformation of the company’s Asia, Middle East and Africa business, more than doubling net sales and operating profit.
Previously, Mr. Banati held finance and general management roles at Kraft Foods, Cadbury Schweppes and Procter & Gamble. At Kraft Foods, he was President, North Asia and Asia
Pacific Strategy, and led the integration of Cadbury and Kraft Foods for that region. At Cadbury Schweppes, he was President of the Pacific region, overseeing Australia, New Zealand, Japan and Singapore, and served previously as the company’s Chief
Financial Officer of the Asia Pacific division. At Procter & Gamble, he spent nearly 15 years in finance roles, rising to become Chief Financial Officer of the Asean, Australia, India, Singapore region in the company’s Health and Beauty Care
division. He received a bachelor’s degree in commerce from Calcutta University and an MBA from the Indian Institute of Management in Lucknow. Mr. Banati also currently serves on the Board of Fortune Brands Innovations.
About Kenvue
Kenvue Inc. is the world’s largest pure-play consumer health company by revenue. Built on more than a century of heritage, our iconic brands, including Aveeno®, BAND-AID® Brand,
Johnson’s®, Listerine®, Neutrogena®, and Tylenol®, are science-backed and recommended by healthcare professionals around the world. At Kenvue, we realize the extraordinary power of everyday care. Our teams
work every day to put that power in consumers’ hands and earn a place in their hearts and homes. Learn more at www.kenvue.com.
Cautions Concerning Forward-Looking Statements
This press release contains “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995 regarding Kenvue’s Chief Financial Officer transition.
Forward-looking statements may be identified by the use of words such as “plans,” “expects,” “will,” “anticipates,” “estimates” and other words of similar meaning. The reader is cautioned not to rely on these forward-looking statements. These
statements are based on current expectations of future events. If underlying assumptions prove inaccurate or known or unknown risks or uncertainties materialize, actual results could vary materially from the expectations and projections of Kenvue
Inc. (“Kenvue”) and its affiliates.
A list and descriptions of risks, uncertainties and other factors can be found in Kenvue’s filings with the Securities and Exchange Commission, including its Annual Report on Form
10-K for the fiscal year ended December 29, 2024 and subsequent Quarterly Reports on Form 10-Q and other filings, available at www.kenvue.com or on request from Kenvue. Kenvue and its affiliates undertake no obligation to update any forward-looking
statements, whether as a result of new information, future events or developments or otherwise.
##