UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 001-36729 FRESHPET, INC. (Exact Name of Registrant as Specified in its Charter) Delaware 20-1884894 (State or other jurisdiction of incorporation or organization) (I.R.S. Emp ...

Financial Data and Key Metrics Changes - In Q2, net sales reached $183.3 million, representing a 26% increase year-over-year, with a net price mix up slightly more than 7% and volume growth around 18% [15][16] - Adjusted gross margin improved to 39.8%, up 110 basis points from the previous year, driven by better pricing and operational improvements [16][17] - Adjusted EBITDA for Q2 was $9 million, significantly exceeding initial expectations, with a total of $12 million in adjusted EBITDA year-to-date [20][21] Business Line Data and Key Metrics Changes - The Ennis Kitchen start-up is operational with one bag line and one roll line running 24/7, contributing to production efficiency and supply chain stability [3][4] - The company placed 1,385 new fridges in Q2, with expectations to install over 5,000 new fridges for the year, enhancing retail refrigerated space [5] Market Data and Key Metrics Changes - Nielsen measured dollar growth was up 23% year-over-year, with non-measured channels showing even stronger growth, contributing significantly to overall performance [16][50] - Household penetration increased by 10% year-over-year, with the buying rate for high-profit pet-owning households (HIPPOs) up 17% [79][105] Company Strategy and Development Direction - The company aims to make Freshpet accessible to a broader consumer base while focusing on operational improvements to restore margins and enhance returns on invested capital [2][14] - The strategic focus includes ramping up production in Ennis and expanding capacity to meet consumer demand without further dilution [33][36] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future gains as operational efficiencies improve, with expectations for continued strong growth driven by volume rather than pricing [4][23] - The company anticipates a positive trajectory for the remainder of the year, with adjusted EBITDA guidance raised to at least $55 million [30][31] Other Important Information - Recent board appointments include industry veterans with relevant expertise, enhancing governance and strategic direction [6][7][10] - The company has made significant investments in human capital, including the Freshpet Academy, to reduce turnover and build critical skills [11][12] Q&A Session Summary Question: Media spend efficiency and targeting - Management noted that media spending is more balanced this year, with a focus on both new and existing consumers, and highlighted strong performance from high-profit pet-owning households [45][47] Question: Unmeasured channel growth - Management confirmed that non-measured channel growth is strong, driven by club and e-commerce, and is expected to continue accelerating [53][56] Question: Pricing strategy and consumer behavior - Management indicated that consumers have adapted to previous price increases, and the company is focused on maintaining value while monitoring competitive pricing dynamics [94][133] Question: Volume acceleration drivers - Management attributed volume growth to improved in-stock conditions and effective media strategies, with expectations for continued acceleration in the second half of the year [123][129]

Financial Performance - Total net sales for the second quarter of 2023 reached $183.3 million, a 25.6% increase from $146.0 million in the same period of 2022[16] - Gross profit for the second quarter of 2023 was $59.2 million, compared to $51.1 million in the second quarter of 2022, reflecting a gross margin improvement[16] - The company reported a net loss attributable to common stockholders of $16.9 million for the second quarter of 2023, a decrease from a loss of $20.6 million in the same quarter of 2022[16] - For the six months ended June 30, 2023, the net loss was $41,738,000, compared to a net loss of $38,128,000 for the same period in 2022, indicating an increase in losses of approximately 6.9%[21] - The company experienced a loss from operations of $16.8 million in the second quarter of 2023, slightly improved from a loss of $18.1 million in the same period of 2022[16] Assets and Liabilities - Total current assets increased to $487.1 million as of June 30, 2023, up from $262.0 million at the end of 2022, primarily driven by higher cash and cash equivalents[12] - Total liabilities surged to $472.6 million as of June 30, 2023, compared to $93.8 million at the end of 2022, largely due to the issuance of convertible senior notes[12] - The company’s accumulated deficit increased to $336.9 million as of June 30, 2023, from $295.1 million at the end of 2022[12] - Cash and cash equivalents increased significantly to $244.0 million as of June 30, 2023, compared to $132.7 million at the end of 2022[12] - As of June 30, 2023, total inventories amounted to $65.3 million, compared to $58.3 million as of December 31, 2022, reflecting an increase of 11.8%[42] Expenses - Selling, general, and administrative expenses for the second quarter of 2023 were $76.0 million, up from $69.2 million in the same quarter of 2022[16] - The company reported share-based compensation expenses of $16,862,000 for the six months ended June 30, 2023, up from $12,589,000 in the prior year, reflecting a 34.5% increase[21] - The company recorded depreciation and amortization expense of $28,930,000 for the first half of 2023, compared to $15,888,000 in the same period of 2022, indicating an increase of 82%[21] Cash Flows - Total cash flows used in operating activities for the first half of 2023 were $(231,000), a significant improvement compared to $(62,402,000) in the same period of 2022[21] - Freshpet's cash flows used in investing activities totaled $(215,948,000) for the first half of 2023, compared to $(118,006,000) in the same period of 2022, representing an increase of approximately 83%[21] - Proceeds from the issuance of convertible senior notes amounted to $393,518,000, contributing to net cash flows provided by financing activities of $327,492,000 for the first half of 2023[21] Investments and Capital Expenditures - The company invested $102,507,000 in property, plant, and equipment during the first half of 2023, compared to $94,872,000 in the same period of 2022, marking an increase of about 8.7%[21] - The carrying amount of property, plant, and equipment, net, was $865.2 million as of June 30, 2023, an increase from $800.6 million at the end of 2022[43] Debt and Financing - The Company issued $402.5 million of 3.00% Convertible Senior Notes in March 2023, which are accounted for as a single liability measured at amortized cost[29][30] - The effective interest rate for the Convertible Notes is 3.59%, with total interest expense for the six months ended June 30, 2023, amounting to $3,896[58][60] - As of June 30, 2023, the carrying value of the Convertible Notes was $391,882, while the fair value was $476,327[59] Legal and Regulatory Matters - The company is involved in various claims and legal actions, including a breach of contract claim with Phillips Feed Service, seeking damages in excess of $8,300[77] Market and Economic Conditions - The company is exposed to commodity price volatility and inflation risks, which could increase operating costs as a percentage of net sales if not addressed[157]

Financial Data and Key Metrics Changes - The company reported a net sales growth of 27% in Q1 2023, reaching $167.5 million, which aligns with the guidance provided for the quarter [21][26] - Adjusted EBITDA for Q1 was $3 million, significantly better than initial expectations, primarily due to strong operational performance in cost of goods sold (COGS) and logistics [22][29] - Adjusted gross margin was 38.5% in Q1, slightly above the previous year, driven by increased pricing and improvements in quality costs [27][29] Business Line Data and Key Metrics Changes - The pet specialty business saw a consumption growth rebound of 19% in Q1 compared to the prior year, indicating strong performance across channels [26][106] - The company added 369 net new stores and upgraded 241 stores to larger fridges in Q1, with plans for more fridge placements throughout the year [25][40] Market Data and Key Metrics Changes - Household penetration growth was reported at 7% over the past 52 weeks, with a buying rate growth of 28%, indicating solid loyalty among heavy users despite a 20% price increase [9][104] - Nielsen measured volume growth rate increased from 12% at the beginning of Q1 to around 16% by the end of the quarter, with expectations for continued growth into the high teens and low 20s by year-end [14][34] Company Strategy and Development Direction - The company is focused on improving operational efficiencies, particularly in logistics and quality, as part of its Fresh Future plan, which aims to enhance margins and support long-term growth [10][31] - Marketing strategies are being fully deployed for the first time in several years, with new advertising campaigns and updated packaging expected to resonate well with consumers [11][27] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the ongoing improvements in operations and the positive impact of investments made in training and facilities, particularly in Ennis [10][17] - The company anticipates that net sales growth will increasingly be driven by volume rather than pricing as the year progresses, with Q2 and Q3 expected to show mid-20s growth rates [13][14] Other Important Information - The company has a strong cash position, with $387 million in cash and short-term investments at the end of the quarter, which will support growth through 2024 [30] - The Ennis Kitchen startup is progressing well, with production ramping up and expected to unlock significant logistics savings [24][31] Q&A Session Summary Question: Can you unpack the guidance a little bit? - Management indicated that while pricing benefits will moderate, they expect volume growth to drive sales acceleration, particularly from heavy users [39][40] Question: What is the plan for attracting new users? - The strategy includes focusing on heavy users and expanding product offerings to appeal to a broader consumer base, while also enhancing advertising efforts [54][59] Question: How is the advertising spend expected to change? - Q2 advertising spending is projected to be slightly higher than Q1, with a significant portion allocated to the first half of the year [45][46] Question: What is the current status of household penetration? - Management noted that while household penetration has decreased, heavy users are increasing their buying rates, and efforts are being made to attract new users [110][120] Question: How are commodity input costs affecting margins? - Commodity costs are locked in at around 80%, with mid to upper single-digit inflation expected, allowing for potential margin expansion [125][126]

PERFORMANCE AND STRONG GROWTH $132.2 2022 2023 +27% +41% FRESHPET Q1 2023 ADJ. EBITDA ($ millions) 7 Q1 2023 EARNINGS PRESENTATION PARTIALLY OFFSET BY TRADE INVENTORY RE-FILL IN THE YA MegaChannel (xAOC+Pet Superstore) Certain statements in this presentation by Freshpet, Inc. (the "Company") constitute "forward-looking" statements, which include any statements related to the the Freshpet Kitchens Expansion, our long-term capacity planning, our net sales and Adjusted EBITDA guidance and the Company's general ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 001-36729 FRESHPET, INC. (Exact Name of Registrant as Specified in its Charter) Delaware 20-1884894 (State or other jurisdiction of incorporation or organization) (I.R.S. Employe ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K (Mark One) Commission File Number 001-36729 FRESHPET, INC. (Exact name of registrant as specified in its charter) Delaware 20-1884894 (State of Incorporation) (I.R.S. Employer Identification No.) 400 Plaza Drive, 1st Floor Secaucus, New Jersey 07094 (Address of Principal Executive Offices) (Zip Code) (201) 520-4000 (Registrant's telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 001-36729 FRESHPET, INC. (Exact Name of Registrant as Specified in its Charter) Delaware 20-1884894 (State or other jurisdiction of incorporation or organization) (I.R.S. Emp ...

Freshpet, Inc. (NASDAQ:FRPT) Q3 2022 Earnings Conference Call November 1, 2022 4:30 PM ET Company Participants Jeff Sonnek - Investor Relations, ICR Billy Cyr - Chief Executive Officer Dick Kassar - Interim Chief Financial Officer Scott Morris - Chief Operating Officer Conference Call Participants Bill Chappell - Truist Securities Anoori Naughton - JPMorgan Mark Astrachan - Stifel Brian Holland - Cowen and Company Michael Lavery - Piper Sandler Robert Moskow - Credit Suisse Peter Benedict - Baird Rupesh Pa ...

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