Financial Performance - Fiscal 2024 net sales were $3.2 billion, a decrease of 3% from $3.3 billion in the prior year[3]. - Fiscal 2024 GAAP EPS was $1.62, down from $1.88 a year ago; non-GAAP EPS increased to $2.13 from $2.07[3][10]. - Pet segment net sales were $1.83 billion, a decrease of 2%; Garden segment net sales were $1.37 billion, a decrease of 5%[6]. - Operating income decreased by 12% to $185 million from $211 million in the prior year; non-GAAP operating income was $223 million compared to $227 million[8]. - Net income attributable to Central Garden & Pet for FY 2024 was $107,983 thousand, down from $125,643 thousand in FY 2023[50]. - The company reported a net loss of $34,158 thousand for the three months ended September 2024, compared to a net income of $2,835 thousand for the same period in 2023[51]. - Interest expense for FY 2024 was $37,872 thousand, compared to $49,663 thousand in FY 2023, indicating a decrease of 23.8%[50]. - The company experienced a decrease in net income from operations for FY 2024, reporting $185,387 thousand compared to $210,646 thousand in FY 2023[50]. Cash and Debt Management - Cash and cash equivalents increased to $754 million from $489 million a year ago, driven by inventory conversion to cash[21]. - Total debt remained at $1.2 billion, with a gross leverage ratio of 3.1x[22]. - Cash, cash equivalents, and restricted cash at the end of the year totaled $768,403 thousand, up from $502,873 thousand at the end of the previous year, marking a 52.7% increase[38]. - Total current assets increased to $1,886,806, up 10.5% from $1,707,123 in the previous year[36]. - Total liabilities increased to $1,878,978, up from $1,780,564 in the previous year[36]. Operational Efficiency - Gross margin expanded by 90 basis points to 29.5% from 28.6% in the prior year, driven by productivity efforts[7]. - Selling, general and administrative expenses increased to $201,360, up 7.4% from $188,084 in the previous year[37]. - The company reported depreciation and amortization of $90,807 thousand for the fiscal year ended September 28, 2024, compared to $87,700 thousand in the previous year, reflecting a 2.5% increase[38]. - The company recognized $45 million in non-GAAP charges in fiscal 2024, primarily related to Cost & Simplicity initiatives[23]. Segment Performance - The Pet segment's operating income decreased to $14 million from $43 million a year ago, reflecting lower volume and inventory impairment[18]. - The Pet segment reported a GAAP operating income of $14.3 million for Q4 fiscal 2024, compared to $43.2 million in Q4 fiscal 2023[47]. - The Garden segment experienced a GAAP operating loss of $28.8 million in Q4 fiscal 2024, compared to a loss of $3.4 million in Q4 fiscal 2023[47]. - Organic net sales for the Pet segment in FY 2024 were $1,766.4 million, down 5.9% from FY 2023's $1,877.2 million[48]. - Organic net sales for the Garden segment in FY 2024 were $1,367.7 million, a decrease of 1.2% from FY 2023's $1,384.8 million[48]. Future Outlook - Central expects fiscal 2025 non-GAAP EPS to be $2.20 or better, considering macroeconomic uncertainties[28]. - The company anticipates continued challenges in the market due to changing conditions and competition, impacting future performance[44]. - The company plans to focus on market expansion and new product development to drive future growth[49]. Non-GAAP Measures - Non-GAAP financial measures are utilized to provide additional insights into the company's performance, excluding specific items that may distort comparability between periods[39]. - Adjusted EBITDA for FY 2024 was $334,209 thousand, compared to $342,895 thousand in FY 2023, reflecting a decrease of 2.0%[50]. - Non-GAAP adjustments for FY 2024 totaled $37,432 thousand, compared to $16,559 thousand in FY 2023, showing an increase in adjustments[50].

Core Viewpoint - Central Garden & Pet Company (CENT) is expected to report a decline in both revenue and earnings for the fourth quarter of fiscal 2024, with revenues estimated at $723.8 million, reflecting a 3.5% decrease from the previous year [1]. Financial Performance - The consensus estimate for the bottom line remains unchanged at a loss of 20 cents per share, with a trailing four-quarter earnings surprise of 38.9% on average [2][10]. - An operating loss of $25.7 million is anticipated for the fourth quarter, which includes a write-down charge related to grass seed inventory [8]. Segment Performance - The Pet segment is projected to see a sales decline of 5.6% due to macroeconomic challenges affecting consumer discretionary spending and a decrease in new pet adoptions [4]. - The Garden segment is expected to experience a slight sales decline of 0.6%, which is an improvement compared to a 6.1% drop in the previous quarter [5]. Operational Challenges - The company is undergoing significant operational restructuring, including the closure of distribution facilities and winding down its underperforming pottery business, which may lead to short-term revenue disruptions [6]. - Increased competition and lower foot traffic in home centers are likely contributing factors to weaker top-line performance [6]. Inventory and Cost Management - A notable concern is the significant decrease in market prices for grass seed, with an estimated write-down of $15 million to $20 million impacting profitability [7]. - SG&A expenses are expected to increase by 140 basis points as a percentage of net sales in the final quarter, which could pressure margins [7]. Strategic Initiatives - Despite the challenges, the company is advancing its cost and simplicity program, along with investments in capacity expansion and automation, which are expected to mitigate some bottom-line pressure [9].

Central Garden (CENT) is expected to deliver a year-over-year decline in earnings on lower revenues when it reports results for the quarter ended September 2024. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price.The earnings report might help the stock move higher if these key numbers are better than expectations. On the other hand, if they miss, the ...

Central Garden & Pet Company (CENT) faced challenges over the last six months, in turn, experiencing a stock price decline of 13.1%. This stands in contrast with the broader industry and the S&P 500 index's rise of 14.2% and 3.6%, respectively. Image Source: Zacks Investment Research Closing at $36.65 yesterday, the stock moved down 22.7% from its 52-week high of $47.48 attained on May 15, 2024. Also, the stock has fallen below critical technical thresholds, including its 50-day and 200-day moving averages. ...

Central Garden & Pet Company (CENT) reported soft third-quarter fiscal 2024 results, wherein both revenues and earnings declined year over year. The company faced challenges across its Pet and Garden segments, contributing to the decline. Net sales dipped 2.6% compared to the same period last year, and organic sales also dropped by 3%. These results reflect the impact of various operational and market headwinds, including inflationary pressures and shifts in consumer demand. Closing yesterday's session at $ ...

Central Garden & Pet Company (CENT) has faced a sharp decline in its stock price, dropping 10.6% over the past three months. This stark contrast to the industry's growth of 13.9% signals underlying challenges for the company. This Walnut Creek, CA-based company is grappling with significant challenges that have hurt its financial results. This was reflected in its third-quarter fiscal 2024 results, wherein both revenues and earnings declined year over year. The company's difficulties are rooted in its core ...

| --- | --- | --- | |------------------------|-------|-------| | | | | | | | | | Q3 FY2024 | | | | Investor Presentation | | | | 8.7.2024 | | | | | | | Business & Industry Update Beth Springer, Interim CEO Q3 FY24 Financials, FY24 Outlook Niko Lahanas, CFO Management Q&A Beth Springer, Niko Lahanas, J.D. Walker, John Hanson Q3 FY24 Investor Presentation 2 | --- | --- | |-------------------------------|----------------------------------------------------------------------------------------------------------- ...

Financial Data and Key Metrics Changes - The company reported GAAP EPS of $1.19 and non-GAAP EPS of $1.32, with a decline from $1.25 and $1.40 respectively in the prior year [4][8] - Net sales were $996 million, a 3% decrease compared to the prior year, with organic net sales also declining by 3% [6][7] - Non-GAAP gross profit was $326 million, consistent with the prior year, while non-GAAP gross margin improved to 32.7% [7][8] - Non-GAAP operating income was $127 million, with a non-GAAP operating margin contracting by 60 basis points to 12.8% [7][8] - Non-GAAP net income was $88 million, down from $94 million a year ago [8] Business Line Data and Key Metrics Changes Pet Segment - Pet segment sales increased by 1% to $508 million, driven by the TDBBS acquisition, while organic net sales decreased by 2% [8][10] - Pet segment operating income improved by 39% to $83 million, with an operating margin expansion of 450 basis points to 16.4% [10] - E-commerce sales in the pet segment grew high single digits, representing approximately 28% of total pet sales [10][30] Garden Segment - Garden segment sales were $488 million, a 6% decline from the prior year, with organic net sales down 4% [11][12] - Non-GAAP Garden segment operating income was $74 million, down from $88 million a year ago, with operating margin declining to 15.1% [11][12] - E-commerce sales in the garden segment now represent 7% of total garden sales, with double-digit growth across categories [12] Market Data and Key Metrics Changes - The company faced unfavorable weather conditions impacting sales, particularly in live plants, which saw a significant decline [5][19] - The independent garden channel distribution business sold last fiscal year represented approximately 5% of garden sales [11] - The company noted that household penetration and buy rates in the garden category remained stable compared to prior years [12] Company Strategy and Development Direction - The company is focused on a cost and simplicity program to improve profitability and generate funds for investments in its Central to Home strategy [5][16] - The decision to exit the underperforming pottery business and close a live plants distribution facility is part of the strategy to streamline operations [5][14] - The company is looking for growth and margin-accretive acquisition targets in both pet and garden sectors, with a bias towards pet due to its less seasonal nature [17][46] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges such as volatile weather, retailer inventory uncertainty, and a value-seeking consumer environment [5][17] - The company maintains its fiscal year outlook for non-GAAP EPS of $2 or better, despite anticipated write-downs in grass seed inventory [16][17] - Long-term consumer trends in the pet and garden industries remain attractive, supporting growth potential [6][17] Other Important Information - The company reported cash and cash equivalents of $570 million, up from $333 million a year ago, indicating a strong balance sheet [13] - Total debt remained at $1.2 billion, with a gross leverage ratio of 3x, down from 3.1x a year ago [13] Q&A Session Summary Question: Insights on Garden Segment Trends - Management noted that unfavorable weather significantly impacted the live goods business, which is crucial for Q3 sales, but underlying metrics for other businesses remained healthy [19] Question: Margin Opportunities Moving Forward - The company plans to continue its cost and simplicity initiatives, with a focus on portfolio optimization and higher-margin businesses [20][21] Question: Clarification on Grass Seed Market Dynamics - Management explained that fluctuations in supply and demand have led to a significant drop in grass seed prices, necessitating a write-down of inventory [24][25] Question: Performance of Pet Durables - The durable pet products segment has been softer than expected, with consumables growing mid-single digits while durables continue to decline [27][28] Question: M&A Opportunities - The company is actively looking for both larger and tuck-in acquisition opportunities, particularly in the pet sector [45][51]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 29, 2024 or ☐ TRANSITION REPORT PURSUANT OF SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-33268 Central Garden & Pet Company Delaware 68-0275553 (State or other jurisdiction of incorporation or organization) (I.R.S. Em ...

Central Garden & Pet Company (CENT) came up with third-quarter fiscal 2024 results, with revenues falling short of the Zacks Consensus Estimate, although earnings surpassed the same. However, both the top and bottom lines declined year over year. Nonetheless, management has been actively strengthening its position in the pet and lawn and garden supplies space. The company focuses on brand building, containing costs, reducing complexity and improving margins. The company's Cost and Simplicity program contrib ...