Financial Data and Key Metrics Changes - The company reported record operating income and earnings per share (EPS) for Q3, with GAAP EPS at $1.56 and non-GAAP EPS at $1.75, an increase of $0.36 from the prior year [12][119] - Non-GAAP operating income increased by 20% to a record $137 million, with a non-GAAP operating margin expanding by 220 basis points to 13.4% [36][118] - Cash and cash equivalents increased by $137 million to $333 million, with net cash provided by operations reaching a record $325 million for the quarter [121] Business Line Data and Key Metrics Changes - Pet segment sales were $503 million, essentially flat compared to the prior year, with strong performance in consumables offsetting declines in durable products [37][120] - The Garden segment saw sales grow by 2% to $520 million, driven by live plants, packaged seeds, and wild bird businesses [13][118] - Non-GAAP Pet segment operating income increased by 18% to $74 million, with operating margin expanding by 230 basis points to 14.7% [120] Market Data and Key Metrics Changes - E-commerce sales in the garden segment grew over 20%, now representing more than 5% of total garden sales, indicating a shift towards online purchasing [8][113] - Retail partners have reduced lawn and garden off-shelf display activity, with foot traffic across home centers and mass channels remaining below prior year but improving [7][8] - Pet ownership data indicates a slight decline from the COVID peak, but spending on pets remains resilient, with pet parents less likely to reduce spending in a recessionary environment [7][6] Company Strategy and Development Direction - The company is focused on a multi-year cost and simplicity program aimed at reducing costs and simplifying operations, including the sale of its independent garden center distribution business [5][33] - The strategy includes optimizing procurement, logistics, manufacturing, and administrative costs to drive higher margins and support organic growth and M&A [32][122] - The company plans to close its Portland, Oregon garden distribution facility by the end of the calendar year as part of its simplification efforts [116] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the competitive strength of the company and the long-term growth trends in the pet and garden industries [117][122] - The fourth quarter is off to a good start, with expectations that the focus on cost and cash will continue to yield benefits [10] - Management acknowledged challenges in the pet durables category due to a decline in pet ownership but remains optimistic about the long-term outlook for the pet industry [69][83] Other Important Information - The company incurred $14 million in one-time charges related to the closure of its pet bedding facility, with expected annual benefits of $4 million to $6 million [11] - Total debt remained at $1.2 billion, with a gross leverage ratio of 3.1 times, well within the target range [14] Q&A Session Summary Question: Can you elaborate on the exit from the distribution business? - The company is exiting the independent garden center distribution business, which represents less than 5% of total garden sales and was complex to manage. The focus will shift to core competencies and distribution for larger retailers [21][33] Question: How is the grass seed business performing? - The grass seed business gained share in the first half of the year and held share in Q3, with overall POS growth in the mid-single digits for the full year [25][37] Question: What are the expectations for gross margin going forward? - The majority of gross margin improvement was driven by pricing, with ongoing cost savings initiatives also contributing. The company remains focused on expanding margins [48] Question: How is inventory destocking progressing? - Retail inventories are down high single digits year-over-year, indicating significant destocking. The company feels well-positioned going into fiscal 2024 [54][55] Question: What is the outlook for M&A activity? - The M&A environment has been slow but is showing signs of improvement. The company remains patient and is accumulating cash to pursue the right opportunities [90]

Our business is seasonal and our working capital requirements and capital resources track closely to this seasonal pattern. Generally, during the first fiscal quarter, accounts receivable reach their lowest level while inventory, accounts payable and short-term borrowings begin to increase. During the second fiscal quarter, receivables, accounts payable and short-term borrowings increase, reflecting the build-up of inventory and related payables in anticipation of the peak lawn and garden selling season. Du ...

Central Garden & Pet Company (NASDAQ:CENT) Q2 2023 Earnings Conference Call May 3, 2023 4:30 PM ET Company Participants Friederike Edelmann - VP of IR Tim Cofer - CEO Niko Lahanas - CFO JD Walker - President of Garden Consumer Products John Hanson - President of Pet Consumer Products Conference Call Participants Bill Chappell - Truist Securities Brad Thomas - KeyBanc Capital Markets Andrea Teixeira - JPMorgan Hale Holden - Barclays Carla Casella - JPMorgan Karru Martinson - Jefferies Operator Ladies ...

Table of Contents • fluctuations in energy prices, fuel and related petrochemical costs; 3 PART I. FINANCIAL INFORMATION LIABILITIES AND EQUITY See notes to condensed consolidated financial statements. CENTRAL GARDEN & PET COMPANY CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts, unaudited) See notes to condensed consolidated financial statements. CENTRAL GARDEN & PET COMPANY CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (in thousands, unaudited) See notes ...

Q1 FY23 Financials, FY23 Outlook Niko Lahanas, CFO | --- | --- | |--------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------| | Forward-looking Statements | | | This presentation includes "forward-looking statements." Forward | -looking statements include statements concerning our | | plans, objectives, goals, strategies, future events, future revenues or performance, capital ...

There have been no material changes to our critical accounting policies, estimates and assumptions or the judgments affecting the application of those accounting policies since our Annual Report on Form 10-K for the fiscal year ended September 24, 2022. Item 3. Quantitative and Qualitative Disclosures About Market Risk There has been no material change in our exposure to market risk from that discussed in our Annual Report on Form 10-K for the fiscal year ended September 24, 2022. 28 Item 4. Controls and Pr ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ________________________________________________________________________________________ FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended September 24, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to ________ Commission File Number 1-33268 Central Garden & Pet Company (Ex ...

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 25, 2022 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 ...

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 March 26, 2022 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 Compan ...

Financial Performance - Consolidated net sales for fiscal 2021 were $3.3 billion, with the Pet segment contributing approximately $1.9 billion and the Garden segment approximately $1.4 billion[108]. - In Q1 fiscal 2022, net sales increased by $69.2 million, or 11.7%, to $661.4 million, primarily driven by sales from four fiscal 2021 acquisitions[110]. - Organic net sales in Q1 fiscal 2022 increased by 0.5%, with a 0.8% increase in the Pet segment and a 0.3% decline in the Garden segment[110]. - The company reported a GAAP net income of $9.009 million for the three months ended December 25, 2021, compared to $5.613 million for the same period in 2020, representing a 60.5% increase[134]. - Non-GAAP net income attributable to the company was $15.706 million for the three months ended December 25, 2021, compared to $9.009 million for the same period in 2020, reflecting a 74.5% increase[134]. - The company’s adjusted EBITDA for the three months ended December 25, 2021, was $51.603 million, compared to $44.624 million for the same period in 2020, indicating a 15.4% increase[138]. - Organic net sales for the company were $591.4 million for the three months ended December 25, 2021, up from $588.3 million for the same period in 2020, showing a 0.5% increase[135]. - The company experienced a 44.7% increase in net sales for its Garden segment, reaching $225.4 million for the three months ended December 25, 2021, compared to $155.8 million for the same period in 2020[138]. Profitability and Expenses - Gross profit for Q1 fiscal 2022 rose by $32.8 million, or 19.8%, to $198.2 million, with gross margin increasing by 210 basis points to 30.0%[117]. - Selling, general and administrative expenses increased by $33.6 million, or 24.3%, to $172.0 million, representing 26.0% of net sales[118]. - Operating income for Q1 fiscal 2022 decreased by $0.8 million, or 3.1%, to $26.2 million, with an operating margin of 4.0%[122]. - The effective income tax rate for Q1 fiscal 2022 was 20.7%, up from 19.7% in the prior year, primarily due to increased foreign earnings in higher tax jurisdictions[125]. - The company’s GAAP diluted net income per share was $0.16 for the three months ended December 25, 2021, compared to $0.10 for the same period in 2020[134]. - The company’s non-GAAP diluted net income per share was $0.16 for the three months ended December 25, 2021, compared to $0.29 for the same period in 2020[134]. Cash Flow and Debt - Net cash used by operating activities increased by $56.4 million, from $36.1 million for the three months ended December 26, 2020, to $92.5 million for the three months ended December 25, 2021[143]. - Net cash used in investing activities decreased by $67.3 million, from $93.4 million for the three months ended December 26, 2020, to $26.1 million for the three months ended December 25, 2021[144]. - Total debt outstanding increased to $1,185.5 million at December 25, 2021, compared to $789.0 million at December 26, 2020[147]. - The company incurred approximately $6 million of debt issuance costs in conjunction with the issuance of 4.125% Senior Notes due 2031[149]. Capital Expenditures and Acquisitions - The company anticipates capital expenditures of approximately $80 million to $90 million in fiscal 2022, with $24 million already invested through December 25, 2021[146]. - The company expects to continue evaluating potential acquisition candidates in the future as part of its growth strategy[146]. Operational Challenges - The company faced operational challenges due to COVID-19, including increased demand and supply chain disruptions, impacting service and fill rates[112]. - Inflationary pressures have impacted the company's revenues and margins, particularly due to rising costs for key commodities, labor, and freight during fiscal 2021 and continuing into fiscal 2022[140]. Credit Facilities - The company entered into an amended credit agreement providing up to $750 million in a senior secured asset-based revolving credit facility, maturing on December 16, 2026[111]. - The Amended Credit Facility provides for a $750 million principal amount, with net availability of approximately $414 million as of December 25, 2021[160]. - The applicable interest rate for Base Rate borrowings was 3.3%, and for one-month LIBOR-based borrowings was 1.1% as of December 25, 2021[161]. - The Amended Credit Facility requires a minimum fixed charge coverage ratio of 1.00:1.00 upon triggered quarterly testing[163]. Parent/Issuer Financials - For the three months ended December 25, 2021, net sales for the Parent/Issuer were $185,406 thousand, while Guarantors reported net sales of $427,511 thousand[168]. - The gross profit for the Parent/Issuer was $42,619 thousand, and for Guarantors, it was $143,599 thousand for the same period[168]. - The net income (loss) for the Parent/Issuer was $(16,353) thousand, while Guarantors reported net income of $29,530 thousand[168]. - Total assets for the Parent/Issuer as of December 25, 2021, were $3,733,912 thousand, compared to Guarantors' total assets of $3,226,679 thousand[168]. - Current liabilities for the Parent/Issuer were $176,072 thousand, while Guarantors had current liabilities of $294,189 thousand[168]. - Long-term debt for the Parent/Issuer was $1,184,479 thousand, with no long-term debt reported for Guarantors[168]. - Total liabilities for the Parent/Issuer were $2,735,392 thousand, while Guarantors reported total liabilities of $449,308 thousand[168]. - There have been no material changes to off-balance sheet arrangements or contractual obligations since the last annual report[169][170].