Company: PBH
Filing Date: 2025-05-09
Form Type: 10-K
Source: 0001295947-25-000017
Chunk: 21

Company: Prestige Consumer Healthcare Inc.
Filing Date: 2025-05-09
Form: 10-K
Item: Item 1A
Chunk 21
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 both prepayments and short term loans to these suppliers to ensure continuous supply. Most recently, we extended short term loans to a supplier that produces cough/cold and ear care products, which total $7.8 million in the aggregate as of March 31, 2025, to support their continued operation.  If they or any other suppliers cease operations or are otherwise unable to continue to supply products to us, or to repay their indebtedness, our results of operations and financial condition would be adversely impacted.  

At March 31, 2025, we had relationships with 98 third-party manufacturers.  Of those, we had long-term contracts with 16 manufacturers that produced items that accounted for approximately 58% of gross sales for 2025, compared to 26 manufacturers with long-term contracts that accounted for approximately 72% of gross sales in 2024.  One of our suppliers, a privately owned pharmaceutical manufacturer with whom we have a long-term supply agreement, produced products that accounted for more than 10% of our gross revenues during 2025, 2024 and 2023.  During 2025, 2024 and 2023, this manufacturer accounted for approximately 21%, 20% and 20%, respectively, of our gross revenues while we accounted for a significant portion of their gross revenues over that time period.  No other single third-party supplier produces products that account for 10% or more of our gross revenues.  The fact that we do not have long-term contracts with certain manufacturers also means that they could cease manufacturing our products at any time and for any reason or initiate costly price increases, which could have a material adverse effect on our business and results of operations.  Although we are continually in the process of negotiating long-term contracts with certain key manufacturers, we may not be able to reach a timely agreement on acceptable terms, which could have a material adverse effect on our business and results of operations. In addition, even if we do enter into long-term contracts with certain manufacturers, our manufacturers may increase prices under the terms of our existing contracts if they experience increases in input costs, which could have a material adverse impact on our results of operations and financial condition.

Price increases for raw materials, packaging, labor, energy and transportation costs, and other manufacturer, logistics provider or distributor demands, could continue to have an adverse impact on our margins.

The costs to manufacture and distribute our products are subject to fluctuation based on a variety of factors.  Volatility and increases in commodity