Hain CEO on Organic Products, Icahn Relationship

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Oct. 10 (Bloomberg) -- Irwin Simon, founder and CEO of Hain Celestial, discusses the company's organic products and his relationship with billionaire Carl Icahn. He speaks with Trish Regan and Adam Johnson on Bloomberg Television's "Street Smart." (Source: Bloomberg)

Writing the organic food wave.

Hain celestial is having a really good 2013. shares are up thanks to rising consumer demand for natural and organic products.

Earlier this week, the stock dropped 5 are sent after the first quarter guidance missed testaments and joining us now is the ceo, irwin simon.

Uk my thoughts a different product and am looking forward to talking about all of them.

What happened with the last quarter?

We have not announced first quarter yet.

We don't give quarterly guidance and sometimes they go there and set up their quarterly numbers.

Our business has changed dramatically.

The uk today is over $600 million where there is a different margin structure.

We confirm guidance for the year.

Our sales are up over 33% versus one year ago.

Earnings per share are up 20 plus percent.

You have to get the corridors right and the margins right and it was just a difference.

What's the difference between the first quarter and when things get better to get and you reiterate.

Are first quarter is our smallest quarter where there is tea, soup, serial.

Our fourth quarter oh and those are our two biggest.

They are the smallest.

Next year over $2 billion in sales and we will do four or $500 million so it's a small corridor.

It's interesting.

We don't give quarterly guidance.

We are up 17% organically on the sales line, 20% on the bottom line.

Why are you growing sales like that?

Are people just getting more health conscious?

Look at yourself.

Think about your family, what you are doing at home.

The most interesting thing is the most recent nielsen numbers come out, four week numbers that measure consumption and it is sales that have gone through the cash register, not the back room.

Hain products are up and that is going through walmart, target, kroger, supermarkets.

That does not include whole foods.

That's a big rollout.

Whole foods is our biggest customer and we have over 2200 products in a whole foods.

This does not include amazon, one of our biggest customers and it does not and clued stansberry in the uk.

You step back.

Eating healthy is not a fad but a trend.

You come back and look today, how many whole foods are right around the corner here?

How many in new york city?

They plan to open over 1000 stores so the consumer wants healthy foods.

We have some here.

What makes a hain celestial product?

Here is earth's best baby food.

We feed infants and toddlers their first food.

Organic, gm oh free.

-- gmo free.

Genetically modified free.

If you come back can you say, what is the biggest change that's going to happen in food, it is, and this country, whole foods already said that if it has gmo, they will not sell it in stores.

You are asking me about pouch convenience.

Baby food was sold in jars or plastic containers.

This is now 50% of sales for baby food.

Independently he can suck on it so packaging.

Pre-k's and your stash it in the bag.

The soup business is changing from different types of packaging where cans will go away in five years.

The consumer today is well aware of pesticides, chemicals, and that is what is changing the whole food landscape.

The number one cause today of health concerns is obesity.

Why is our government shutdown today he?


What are we concerned with?

Healthcare costs.

What is the preventative care?

What we eat.

Carl icahn had a stake in your company for three years.

That's like calling my father ran saying your son is here drinking beer or something.

Listen, call carl and i'm sure he will say nice things.

He has.

He has said many nice things about you and the company.

Three years you spent with him.

Three and a half.

When you spend that much time with carl icahn, you count in days and hours.

[laughter] you embraced him in a way that's different than a lot of ceos might.

What was your relationship like with carl icahn?

Number 1, 1 day i got a call from my assistant said there's a guy named carl icahn on the phone.

I'm about to file this on your company.

I had every investment bankers saying we need to fight and get a poison pill in place.

My philosophy was, listen, he just got 7 million shares and he found a great opportunity.

He saw an undervalued company.

The company today is a much stronger company, better positioned than it was back then.

And part of what advice he gave you?

When he's an investor, he's going to give you some advice.


It was a relationship that worked out well.

You see a lot of relationships that don't. he and his group made $400 million and more.

I'm happy when shareholders make money and you treat every shareholder the same, but at the end of the day, you see a lot of companies go to start in fight with coral.

You get into proxy fight and you spend money.

At the end of the day, all he wants is the stock to go up.

Our stock went from $20 to about $78 when he got out.

I get asked all the time, what did he see yeah though there's nothing wrong with the ringing the cash register and making money.

He said there was this opportunity and organic space.

If you had to give tim cook one piece of advice right now for dealing with carl, what would it he?

Without mentioning names, my next career, i'm going to be an advisor to companies where carl icahn buys stock in i'm going to charge a lot because i can give you some good advice.

Three on the half years.

I'm not tim cook so i don't get tweeted about my dinners with carl.

He's a practical businessman.

Abducted tell you that i met a lot of smart people in my lifetime.

Some viewers may be watching today and say, he's sucking up to carl icahn.

He's no longer a shareholder so i don't have to.

He can have some great advice.

Apple is an incredible brand with incredible product.

He wants the stock to go further.

With the best piece of advice carl icahn gave you?

The best?

Why do you need so many board members that cost you money?

He said, listen, go back and look at your costs.

Go back and spend on advertising.

At the end of the day, it was about getting your stock price up.

Do you buy stock back?

He said you should not get a salary or increase and there were times when it came to salary and he had a member on the committee where they pushed back hard on my compensation.

It was an interesting relationship that was three and a half years and they did add value where it sends.

Tim could be in for a wild ride.

When you have such a strong brand like apple, the type of capital that apple has today, tim cook is in a better position than i ever was.

At the end of the day, my advice is -- to some degree, carl is like the u.s. government.

He has money, time, and he can say whatever he wants and get away with it.

Where tim cook, reed hastings, and erwin simon cannot necessarily.

There'll be lots of things that i cannot say on air but our relationship has been a great one.

We are going to have a closing dinner and enjoy our relationship.

We will stay in touch with each other.

It sounds like him should listen.

Next time you get a call from him, i will be prepared.

[laughter] had another activist showed up,

This text has been automatically generated. It may not be 100% accurate.


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