Post Holdings, Inc. (NYSE:POST) Q2 2024 Earnings Call Transcript May 3, 2024 9:00 AM ET Company Participants Daniel O'Rourke - Investor Relations Robert Vitale - President and Chief Executive Officer Jeff Zadoks - Executive Vice President and Chief Operating Officer Matt Mainer - Senior Vice President, Chief Financial Officer and Treasurer Conference Call Participants Andrew Lazar - Barclays Michael Lavery - Piper Sandler David Palmer - Evercore ISI Ken Goldman - JPMorgan Robert Dickerson - Jefferies Marc T ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 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, 2024 Commission File Number: 1-35305 Post Holdings, Inc. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organization) Missouri 45-3355106 (I.R.S. Employer Identification No.) 2503 S. Han ...

[Financial Highlights and Outlook](index=1&type=section&id=Financial%20Highlights%20and%20Outlook) This section provides an overview of Post Holdings' financial performance for the second quarter of fiscal year 2024 and its updated outlook for the full fiscal year [Second Quarter Fiscal 2024 Highlights](index=1&type=section&id=Second%20Quarter%20Fiscal%202024%20Highlights) Post Holdings reported strong second-quarter fiscal 2024 results, with net sales reaching $2.0 billion and net earnings of $97.2 million, reflecting robust operational performance and contributions from recent acquisitions Q2 FY2024 Key Metrics | Metric | Value (in millions) | | :--- | :--- | | Net Sales | $2,000.0 | | Operating Profit | $190.1 | | Net Earnings | $97.2 | | Adjusted EBITDA | $345.2 | [Fiscal Year 2024 Outlook](index=4&type=section&id=Fiscal%20Year%202024%20Outlook) The company has raised its fiscal year 2024 Adjusted EBITDA guidance to a range of $1,335-$1,375 million, up from the previous $1,290-$1,340 million, with capital expenditures projected between $420-$445 million for facility expansions and pet food integration - Raised fiscal year 2024 **Adjusted EBITDA guidance to $1,335-$1,375 million**[26](index=26&type=chunk) - Fiscal year 2024 **capital expenditures are expected to range between $420-$445 million**[26](index=26&type=chunk) - Significant investments include **$100-$110 million for Foodservice facility expansions** and **$90-$100 million for Pet Food network investments**[26](index=26&type=chunk) [Consolidated Financial Performance](index=1&type=section&id=Consolidated%20Financial%20Performance) This section details Post Holdings' consolidated operating results for the second quarter and six months of fiscal year 2024, highlighting significant growth in net sales, gross profit, operating profit, and net earnings [Second Quarter Consolidated Operating Results](index=1&type=section&id=Second%20Quarter%20Consolidated%20Operating%20Results) For the second quarter, net sales grew 23.4% to $2.0 billion, largely driven by $467.9 million in sales from acquisitions, leading to a 40.1% increase in gross profit to $579.6 million and a 79.7% rise in net earnings to $97.2 million Q2 FY2024 vs Q2 FY2023 Consolidated Results (in millions) | Metric | Q2 2024 | Q2 2023 | % Change | | :--- | :--- | :--- | :--- | | Net Sales | $1,999.0 | $1,619.9 | +23.4% | | Gross Profit | $579.6 | $413.8 | +40.1% | | Operating Profit | $190.1 | $137.7 | +38.1% | | Net Earnings | $97.2 | $54.1 | +79.7% | | Adjusted EBITDA | $345.2 | $276.3 | +24.9% | - Net sales growth included a **$467.9 million contribution from recent acquisitions**, primarily in the Pet Food business[4](index=4&type=chunk) - Diluted earnings per common share increased to **$1.48 from $0.92** in the prior year period[7](index=7&type=chunk) [Six Month Consolidated Operating Results](index=2&type=section&id=Six%20Month%20Consolidated%20Operating%20Results) For the six months ended March 31, 2024, net sales increased by 24.4% to $3.96 billion, with gross profit growing 39.0% to $1.15 billion, operating profit rising 38.9% to $399.4 million, and net earnings increasing 26.9% to $185.3 million Six Months FY2024 vs FY2023 Consolidated Results (in millions) | Metric | Six Months 2024 | Six Months 2023 | % Change | | :--- | :--- | :--- | :--- | | Net Sales | $3,964.9 | $3,186.2 | +24.4% | | Gross Profit | $1,152.2 | $828.7 | +39.0% | | Operating Profit | $399.4 | $287.6 | +38.9% | | Net Earnings | $185.3 | $146.0 | +26.9% | | Adjusted EBITDA | $704.7 | $546.2 | +29.0% | - SG&A expenses for the six-month period included **$14.1 million of integration costs** related to the Pet Food acquisition and **$8.8 million in restructuring costs** for a facility closure[9](index=9&type=chunk) - Diluted earnings per common share for the six months were **$2.83**, compared to $2.44 in the prior year period[10](index=10&type=chunk) [Segment Performance](index=2&type=section&id=Segment%20Performance) This section provides a detailed analysis of the financial performance of Post Holdings' individual operating segments, including Post Consumer Brands, Weetabix, Foodservice, and Refrigerated Retail [Post Consumer Brands](index=2&type=section&id=Post%20Consumer%20Brands) The Post Consumer Brands segment saw a significant 77.9% increase in Q2 net sales to $1.07 billion, primarily due to $460.7 million from acquisitions, driving an 85.0% rise in segment profit to $139.7 million and a 74.0% increase in Segment Adjusted EBITDA to $199.0 million Post Consumer Brands Q2 Performance (in millions) | Metric | Q2 2024 | Q2 2023 | % Change | | :--- | :--- | :--- | :--- | | Net Sales | $1,065.5 | $599.1 | +77.9% | | Segment Profit | $139.7 | $75.5 | +85.0% | | Segment Adjusted EBITDA | $199.0 | $114.4 | +74.0% | - Acquisitions contributed **$460.7 million to net sales** in the second quarter[12](index=12&type=chunk) - Excluding acquisitions, volumes decreased by **3.9%**, driven by declines in non-retail cereal and peanut butter[12](index=12&type=chunk) [Weetabix](index=2&type=section&id=Weetabix) The Weetabix segment reported a 10.5% increase in Q2 net sales to $138.0 million, aided by a 440 basis point foreign currency tailwind and the Deeside acquisition, though segment profit decreased by 6.7% to $18.1 million and Segment Adjusted EBITDA was nearly flat at $27.8 million Weetabix Q2 Performance (in millions) | Metric | Q2 2024 | Q2 2023 | % Change | | :--- | :--- | :--- | :--- | | Net Sales | $138.0 | $124.9 | +10.5% | | Segment Profit | $18.1 | $19.4 | -6.7% | | Segment Adjusted EBITDA | $27.8 | $28.0 | -0.7% | - Net sales growth was supported by a favorable foreign currency exchange rate tailwind of approximately **440 basis points** and **$7.2 million from the Deeside acquisition**[14](index=14&type=chunk) [Foodservice](index=3&type=section&id=Foodservice) The Foodservice segment experienced a 12.4% decline in Q2 net sales to $554.8 million, with volumes down 2.2% due to a slowdown in away-from-home demand for eggs, resulting in a 17.4% fall in segment profit to $64.5 million and a 7.5% decrease in Segment Adjusted EBITDA to $101.7 million Foodservice Q2 Performance (in millions) | Metric | Q2 2024 | Q2 2023 | % Change | | :--- | :--- | :--- | :--- | | Net Sales | $554.8 | $633.2 | -12.4% | | Segment Profit | $64.5 | $78.1 | -17.4% | | Segment Adjusted EBITDA | $101.7 | $110.0 | -7.5% | - Volumes decreased by **2.2%**, primarily driven by a decline in egg volumes, partially offset by an increase in potato volumes[17](index=17&type=chunk) [Refrigerated Retail](index=3&type=section&id=Refrigerated%20Retail) In the Refrigerated Retail segment, Q2 net sales decreased by 8.5% to $240.4 million, with volumes down 5.1% due to distribution losses in lower-margin egg and cheese products, though segment profit increased by 23.1% to $22.4 million and Segment Adjusted EBITDA grew 2.5% to $40.5 million Refrigerated Retail Q2 Performance (in millions) | Metric | Q2 2024 | Q2 2023 | % Change | | :--- | :--- | :--- | :--- | | Net Sales | $240.4 | $262.7 | -8.5% | | Segment Profit | $22.4 | $18.2 | +23.1% | | Segment Adjusted EBITDA | $40.5 | $39.5 | +2.5% | - Overall volumes decreased by **5.1%**, with egg volumes down **16.6%** and cheese volumes down **10.7%**, while sausage volumes grew **6.9%**[19](index=19&type=chunk)[47](index=47&type=chunk) [Other Financial Information](index=3&type=section&id=Other%20Financial%20Information) This section covers additional financial details, including interest expense, debt, swap performance, income tax rates, and share repurchase activities [Interest, Debt, Swaps, and Income Tax](index=3&type=section&id=Interest%20Debt%20Swaps%20and%20Income%20Tax) Net interest expense for Q2 2024 was $80.0 million, up from $63.8 million in the prior year, driven by higher debt and interest rates, while the company recorded a net income of $13.3 million on swaps compared to a $9.0 million expense last year, and the effective income tax rate for the quarter was 22.7% - Net interest expense increased to **$80.0 million in Q2 2024** from $63.8 million in Q2 2023, primarily due to lower interest income and higher average debt balances[21](index=21&type=chunk) - The company recorded income on swaps of **$13.3 million in Q2 2024**, a reversal from an expense of $9.0 million in the prior-year period[23](index=23&type=chunk) - The effective income tax rate for Q2 2024 was **22.7%**, compared to 25.4% in Q2 2023[24](index=24&type=chunk) [Share Repurchases](index=4&type=section&id=Share%20Repurchases) During the second quarter, Post repurchased 0.1 million shares for $8.1 million, with total repurchases amounting to 0.5 million shares for $44.8 million for the first six months of the fiscal year, leaving $377.8 million remaining under the share repurchase authorization as of April 30, 2024 Share Repurchase Activity | Period | Shares Repurchased (millions) | Cost (in millions) | Average Price | | :--- | :--- | :--- | :--- | | Q2 2024 | 0.1 | $8.1 | $103.88 | | Six Months Ended 3/31/24 | 0.5 | $44.8 | $87.23 | - As of April 30, 2024, Post had **$377.8 million remaining** under its share repurchase authorization[25](index=25&type=chunk) [Financial Statements and Non-GAAP Reconciliations](index=7&type=section&id=Financial%20Statements%20and%20Non-GAAP%20Reconciliations) This section presents the condensed consolidated financial statements, including statements of operations, balance sheets, and cash flows, along with detailed reconciliations of non-GAAP financial measures [Condensed Consolidated Financial Statements](index=7&type=section&id=Condensed%20Consolidated%20Financial%20Statements) The condensed consolidated financial statements provide detailed unaudited results, including the statements of operations, balance sheets, and cash flows for the three and six months ended March 31, 2024, compared to the prior year [Statements of Operations](index=7&type=section&id=Statements%20of%20Operations) The statement of operations shows a year-over-year increase in net sales to $1,999.0 million for the quarter and $3,964.9 million for the six-month period, with net earnings rising to $97.2 million and $185.3 million, respectively Condensed Consolidated Statements of Operations (in millions) | | Three Months Ended March 31, | Six Months Ended March 31, | | :--- | :--- | :--- | | | **2024** | **2023** | **2024** | **2023** | | **Net Sales** | **$1,999.0** | **$1,619.9** | **$3,964.9** | **$3,186.2** | | Gross Profit | $579.6 | $413.8 | $1,152.2 | $828.7 | | Operating Profit | $190.1 | $137.7 | $399.4 | $287.6 | | **Net Earnings** | **$97.2** | **$54.1** | **$185.3** | **$146.0** | | Diluted EPS | $1.48 | $0.92 | $2.83 | $2.44 | [Balance Sheets](index=8&type=section&id=Balance%20Sheets) As of March 31, 2024, total assets stood at $12.19 billion, up from $11.65 billion at September 30, 2023, with total liabilities increasing to $8.20 billion from $7.80 billion, while total shareholders' equity rose to $3.99 billion Condensed Consolidated Balance Sheets (in millions) | | March 31, 2024 | September 30, 2023 | | :--- | :--- | :--- | | Total Current Assets | $1,810.9 | $1,478.5 | | **Total Assets** | **$12,191.1** | **$11,646.7** | | Total Current Liabilities | $839.5 | $805.3 | | Long-term debt | $6,414.6 | $6,039.0 | | **Total Liabilities** | **$8,200.4** | **$7,795.4** | | **Total Shareholders' Equity** | **$3,990.7** | **$3,851.3** | [Cash Flows](index=9&type=section&id=Cash%20Flows) For the six months ended March 31, 2024, cash provided by operating activities was $424.0 million, a significant increase from $198.3 million in the prior year, while investing activities used $432.6 million and financing activities provided $237.1 million Condensed Consolidated Cash Flows (in millions) | Six Months Ended March 31, | 2024 | 2023 | | :--- | :--- | :--- | | Cash provided by operating activities | $424.0 | $198.3 | | Cash used in investing activities | $(432.6) | $(134.0) | | Cash provided by (used in) financing activities | $237.1 | $(161.7) | | **Net increase (decrease) in cash** | **$230.4** | **$(94.0)** | [Segment and Supplemental Information](index=9&type=section&id=Segment%20and%20Supplemental%20Information) This section provides a detailed breakdown of net sales and profit by operating segment for the three and six-month periods, along with supplemental volume percentage changes for the Refrigerated Retail segment, showing declines in egg and cheese but growth in sausage Q2 Net Sales by Segment (in millions) | Segment | Q2 2024 | Q2 2023 | | :--- | :--- | :--- | | Post Consumer Brands | $1,065.5 | $599.1 | | Weetabix | $138.0 | $124.9 | | Foodservice | $554.8 | $633.2 | | Refrigerated Retail | $240.4 | $262.7 | Refrigerated Retail Q2 Volume Change vs Prior Year | Product | Volume Percentage Change | | :--- | :--- | | Side dishes | (0.6%) | | Egg | (16.6%) | | Cheese | (10.7%) | | Sausage | 6.9% | [Reconciliation of Non-GAAP Measures](index=10&type=section&id=Reconciliation%20of%20Non-GAAP%20Measures) The report provides detailed reconciliations of GAAP measures to non-GAAP measures, such as Adjusted Net Earnings and Adjusted EBITDA, with Q2 2024 Net Earnings of $97.2 million reconciling to an Adjusted EBITDA of $345.2 million after various adjustments - The company uses non-GAAP measures like Adjusted EBITDA to evaluate underlying company performance, make financial decisions, and determine executive bonuses[28](index=28&type=chunk)[49](index=49&type=chunk) Q2 Reconciliation of Net Earnings to Adjusted EBITDA (in millions) | | Three Months Ended March 31, 2024 | | :--- | :--- | | **Net Earnings** | **$97.2** | | Income tax expense | $28.6 | | Interest expense, net | $80.0 | | Depreciation and amortization | $119.6 | | Non-cash stock-based compensation | $20.7 | | Other adjustments | $(0.9) | | **Adjusted EBITDA** | **$345.2** | [Disclosures](index=5&type=section&id=Disclosures) This section outlines important disclosures, including forward-looking statements and the various risks and uncertainties that could impact the company's future financial results [Forward-Looking Statements](index=5&type=section&id=Forward-Looking%20Statements) The report contains forward-looking statements regarding the company's fiscal year 2024 outlook for Adjusted EBITDA and capital expenditures, outlining numerous risks and uncertainties that could cause actual results to differ materially, including economic conditions, input cost volatility, supply chain disruptions, and the ability to integrate acquisitions - The report includes forward-looking statements concerning the fiscal year 2024 Adjusted EBITDA and capital expenditure outlook[32](index=32&type=chunk) - Key risks identified include consumer reaction to pricing, changes in economic conditions, volatility in input costs, supply chain disruptions, and successful integration of acquisitions like Pet Food[33](index=33&type=chunk)

Financial Data and Key Metrics Changes - First quarter consolidated net sales were $2 billion, with adjusted EBITDA of $360 million, representing a 26% increase in net sales driven by recent acquisitions [28] - Excluding acquisitions, retail volumes decreased, particularly in U.S. and U.K. cereal, with a 7% volume decline in post-consumer brands [29] - Average net pricing, excluding Pet Food, increased by 8% [29] - Net leverage decreased to 4.5 times, reflecting improved profitability and capital allocation strategies [38][39] Business Line Data and Key Metrics Changes - The grocery division saw profit drivers from carryover pricing and strong cost performance, recovering some gross margin losses due to inflation, despite a 5% volume decline in the U.S. cereal category [20] - The pet food segment exceeded expectations with strong manufacturing performance, contributing to a 1% increase in net sales, while volumes decreased by 7% [29][23] - Foodservice net sales declined by 6%, but volumes increased by 4%, reflecting strong demand and improved service levels [31] - Refrigerated Retail experienced a 4% decrease in both net sales and volumes, although side dish volumes remained flat [32] Market Data and Key Metrics Changes - The operating environment remains challenging, with inflationary pressures persisting in areas such as sugar prices and labor costs, partially offset by improved grain and freight costs [36] - The company noted a mixed volume story, with decreases in branded retail businesses but resilience in foodservice and value offerings [16] Company Strategy and Development Direction - The company is prioritizing M&A over share or debt repurchase, spending approximately $250 million on two tuck-in acquisitions [6] - There is a focus on optimizing the cereal manufacturing network and integrating recent acquisitions into the existing supply chain [9] - The company raised its guidance significantly for the fiscal year 2024, indicating confidence in future performance [40] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to sustain higher volumes and margins, despite ongoing economic challenges [17] - The company is optimistic about supply chain performance, which is expected to yield significant dividends [26] - Management acknowledged the need for continued investment in marketing and promotions to adapt to changing consumer behaviors [102] Other Important Information - The company repurchased 400,000 shares at an average price of $84.28 per share and purchased approximately $26 million of debt at an average discount of 13% [39] - Capital expenditures for the quarter were approximately $81 million, driven by facility expansions [40] Q&A Session Summary Question: What drove the strong performance in pet food? - Management noted that the strong performance was supported by expanded manufacturing capacity and a favorable demand environment [44] Question: How does the company view the shift from away-from-home to at-home eating? - Management confirmed that they are seeing consumers stretching their food budgets, consistent with industry trends, but noted that breakfast remains strong [56] Question: What are the expectations for Weetabix margins? - Management indicated that while there is potential for margin recovery, it will be a multi-year process driven by cost-out activities [60] Question: How does the company plan to manage retail volumes through fiscal '24? - Management emphasized the importance of a diversified portfolio to match consumer demands across different economic cycles, allowing for flexibility in pricing [73] Question: What is the outlook for M&A activity? - Management stated that while there are opportunities in the M&A pipeline, they are focused on executing current integration plans before pursuing new acquisitions [75]

[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section provides the unaudited financial statements and management's discussion and analysis for the first fiscal quarter [Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents Post Holdings, Inc.'s unaudited condensed consolidated financial statements for the quarter ended December 31, 2023, including operations, comprehensive income, balance sheets, cash flows, and equity [Condensed Consolidated Statements of Operations (Unaudited)](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20(Unaudited)) Net sales increased to $1,965.9 million, operating profit rose to $209.3 million, while net earnings slightly decreased to $88.1 million for the quarter Three Months Ended December 31 (in millions, except per share data) | Metric | 2023 | 2022 | | :--- | :--- | :--- | | **Net Sales** | $1,965.9 | $1,566.3 | | **Gross Profit** | $572.6 | $414.9 | | **Operating Profit** | $209.3 | $149.9 | | **Net Earnings** | $88.1 | $91.9 | | **Diluted Earnings per Share** | $1.35 | $1.52 | [Condensed Consolidated Statements of Comprehensive Income (Unaudited)](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Unaudited)) Total comprehensive income decreased to $153.6 million, primarily due to lower net earnings and reduced foreign currency translation adjustments Comprehensive Income (in millions) | Metric | Three Months Ended Dec 31, 2023 | Three Months Ended Dec 31, 2022 | | :--- | :--- | :--- | | Net Earnings Including Noncontrolling Interests | $88.1 | $93.7 | | Total Other Comprehensive Income | $65.1 | $116.8 | | **Total Comprehensive Income** | **$153.6** | **$209.0** | [Condensed Consolidated Balance Sheets (Unaudited)](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20(Unaudited)) Total assets increased to $12,072.4 million, driven by goodwill and intangibles, while total liabilities rose to $8,119.6 million due to increased long-term debt Balance Sheet Highlights (in millions) | Metric | Dec 31, 2023 | Sep 30, 2023 | | :--- | :--- | :--- | | **Total Assets** | $12,072.4 | $11,646.7 | | Total Current Assets | $1,660.7 | $1,478.5 | | Goodwill | $4,652.4 | $4,574.4 | | **Total Liabilities** | $8,119.6 | $7,795.4 | | Long-term debt | $6,314.0 | $6,039.0 | | **Total Shareholders' Equity** | $3,952.8 | $3,851.3 | [Condensed Consolidated Statements of Cash Flows (Unaudited)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20(Unaudited)) Operating cash flow increased to $174.4 million, investing activities used $333.8 million for acquisitions, and financing provided $206.3 million from debt Cash Flow Summary (in millions) | Activity | Three Months Ended Dec 31, 2023 | Three Months Ended Dec 31, 2022 | | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $174.4 | $98.3 | | Net Cash Used in Investing Activities | $(333.8) | $(53.0) | | Net Cash Provided by (Used in) Financing Activities | $206.3 | $(28.3) | | **Net Increase in Cash** | **$48.8** | **$19.8** | [Notes to Condensed Consolidated Financial Statements (Unaudited)](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) Notes detail accounting policies, acquisitions of Perfection Pet Foods and Deeside Cereals, debt structure, segment performance, and the planned closure of the Lancaster facility - On December 1, 2023, the Company acquired **Perfection Pet Foods for $235.0 million** and **Deeside Cereals for approximately $14.3 million**, integrating them into the Post Consumer Brands and Weetabix segments respectively[47](index=47&type=chunk)[52](index=52&type=chunk) - The company finalized plans to close its Lancaster, Ohio, cereal manufacturing facility by fiscal 2024, incurring a **$7.5 million restructuring charge** in the quarter[58](index=58&type=chunk)[59](index=59&type=chunk) Segment Net Sales (in millions) | Segment | Q1 FY2024 | Q1 FY2023 | | :--- | :--- | :--- | | Post Consumer Brands | $988.6 | $554.7 | | Weetabix | $129.1 | $118.1 | | Foodservice | $567.1 | $600.5 | | Refrigerated Retail | $280.9 | $293.0 | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 FY2024 financial performance, highlighting a 26% net sales increase to $1.97 billion, a 40% operating profit rise, segment results, liquidity, and market trends Q1 FY2024 vs Q1 FY2023 Performance (in millions) | Metric | Q1 2024 | Q1 2023 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net Sales | $1,965.9 | $1,566.3 | $399.6 | 26% | | Operating Profit | $209.3 | $149.9 | $59.4 | 40% | | Net Earnings | $88.1 | $91.9 | $(3.8) | (4)% | - Market trends include easing inflationary pressures, avian influenza impacts on Foodservice and Refrigerated Retail, and a consumer shift towards private label products[136](index=136&type=chunk) - The company borrowed **$345.0 million** and repaid **$45.0 million** under its Revolving Credit Facility, and repurchased **$25.9 million** of its 4.50% senior notes[162](index=162&type=chunk) [Segment Results](index=30&type=section&id=Segment%20Results) Post Consumer Brands sales increased 78% due to acquisitions, Weetabix grew 9%, Foodservice declined 6% from lower egg prices, and Refrigerated Retail profit surged 70% despite a 4% sales drop - Post Consumer Brands net sales increased by **$433.9 million (78%)**, primarily from Pet Food (**$407.1 million**) and Perfection (**$19.5 million**) acquisitions, with segment profit growing **67% to $132.7 million**[149](index=149&type=chunk)[150](index=150&type=chunk) - Foodservice net sales decreased by **$33.4 million (6%)** due to lower egg product prices, despite a **4% increase in egg volumes**[153](index=153&type=chunk) - Refrigerated Retail segment profit increased by **$14.6 million (70%)**, driven by reduced manufacturing, raw material, and freight costs, offsetting a **4% net sales decline**[155](index=155&type=chunk)[156](index=156&type=chunk) [Liquidity and Capital Resources](index=32&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity is supported by cash, operating cash flow, and credit facilities, with Q1 FY2024 operating cash flow at $174.4 million, investing activities using $333.8 million, and financing providing $206.3 million - Cash from operating activities increased to **$174.4 million** from **$98.3 million** year-over-year, driven by favorable trade payable timing and prior year inventory cash outflow comparisons[164](index=164&type=chunk)[165](index=165&type=chunk) - Investing activities included **$252.7 million** for Perfection and Deeside acquisitions and **$80.8 million** in capital expenditures[166](index=166&type=chunk) - Financing activities included **$345.0 million** in Revolving Credit Facility borrowings and **$36.7 million** for common stock repurchases[162](index=162&type=chunk)[168](index=168&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=36&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company manages market risks from commodity prices, foreign currency, and interest rates using derivatives, with **$6.32 billion** in debt, and a 10% adverse commodity price change would impact derivatives by **$5 million** - A hypothetical **10% adverse change** in principal hedged commodity prices would decrease the fair value of commodity-related derivatives by approximately **$5 million** as of December 31, 2023[182](index=182&type=chunk) - Total outstanding debt was **$6,323.7 million** as of December 31, 2023, with **$5,618.4 million** at a weighted-average fixed interest rate of **4.8%**[185](index=185&type=chunk) - Interest rate swaps with a notional value of **$700.0 million** would see their fair value decrease by approximately **$13 million** with a hypothetical **10% interest rate increase**[187](index=187&type=chunk) [Controls and Procedures](index=37&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of December 31, 2023, with ongoing integration of controls for Perfection and Pet Food acquisitions - The CEO and CFO concluded that the Company's disclosure controls and procedures were effective as of the report period end[188](index=188&type=chunk) - Management is implementing control changes related to the Perfection and Pet Food acquisitions[189](index=189&type=chunk) [PART II. OTHER INFORMATION](index=37&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section provides other information, including legal proceedings, risk factors, equity sales, and exhibits [Legal Proceedings](index=37&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal proceedings, with management expecting no material impact on financial condition, and no environmental proceedings exceeding the **$1.0 million** disclosure threshold - Management believes the ultimate liability from pending legal proceedings will not be material to the company's consolidated financial condition, results of operations, or cash flows[109](index=109&type=chunk) - The company's **$1.0 million** disclosure threshold for environmental proceedings with a governmental entity resulted in no reportable proceedings for the period[191](index=191&type=chunk) [Risk Factors](index=38&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors previously disclosed in the Annual Report on Form 10-K for the fiscal year ended September 30, 2023, have occurred - No material changes to risk factors previously disclosed in the Annual Report on Form 10-K for the fiscal year ended September 30, 2023, have occurred as of this quarterly report date[192](index=192&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=38&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased **435,774** common shares at an average price of **$84.28** during the quarter, with **$165.7 million** remaining under the existing authorization Share Repurchases for Quarter Ended Dec 31, 2023 | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | Oct 2023 | 283,951 | $83.57 | | Nov 2023 | 82,372 | $84.98 | | Dec 2023 | 69,451 | $86.39 | | **Total** | **435,774** | **$84.28** | - On January 30, 2024, the Board cancelled the existing share repurchase authorization and approved a new **$400.0 million** authorization effective February 5, 2024, expiring February 5, 2026[194](index=194&type=chunk) [Other Information](index=38&type=section&id=Item%205.%20Other%20Information) No director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the first quarter of fiscal 2024 - No director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the first quarter of fiscal 2024[195](index=195&type=chunk) [Exhibits](index=39&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with or incorporated by reference into the Form 10-Q, including agreements, corporate documents, indentures, and officer certifications - The report includes a list of filed exhibits, such as transaction agreements, indentures for senior notes, and CEO/CFO certifications[197](index=197&type=chunk)[198](index=198&type=chunk)

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended September 30, 2023 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: 1-35305 ______________________ POST HOLDINGS, INC. (Exact name of registrant as specified in its charter) ...

Post Holdings, Inc. (NYSE:POST) Q4 2023 Earnings Conference Call November 17, 2023 9:00 AM ET Company Participants Daniel O'Rourke - Investor Relations Robert Vitale - President and Chief Executive Officer Jeff Zadoks - Chief Operating Officer and Interim Chief Executive Officer Matt Mainer - Senior Vice President, Chief Financial Officer and Treasurer Conference Call Participants Andrew Lazar - Barclays Kenneth Goldman - JPMorgan David Palmer - Evercore ISI Matthew Smith - Stifel Michael Lavery - Piper San ...

Post Holdings, Inc. (NYSE:POST) Q3 2023 Earnings Conference Call August 4, 2023 9:00 AM ET Company Participants Daniel O'Rourke - IR Rob Vitale - President and CEO Matt Mainer - CFO Conference Call Participants Andrew Lazar - Barclays David Palmer - Evercore ISI Michael Lavery - Piper Sandler Bill Chappell - Truist Securities Robert Dickerson - Jefferies Jason English - Goldman Sachs Matt Smith - Stifel Operator Good day, and welcome to the Post Holdings Quarter Three 2023 Earnings Conference Call. At this ...

[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents Post Holdings, Inc.'s unaudited condensed consolidated financial statements for the quarter ended June 30, 2023 [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20(Unaudited)) Net sales increased for the quarter and nine months, while net earnings decreased due to significant prior-year gains Consolidated Statements of Operations Highlights (in millions, except per share data) | Metric | Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | Nine Months Ended June 30, 2023 | Nine Months Ended June 30, 2022 | | :--- | :--- | :--- | :--- | :--- | | **Net Sales** | $1,859.4 | $1,524.9 | $5,045.6 | $4,272.1 | | **Gross Profit** | $501.6 | $364.7 | $1,330.3 | $1,074.9 | | **Operating Profit** | $158.3 | $105.5 | $445.9 | $283.7 | | **Net Earnings** | $89.6 | $170.2 | $235.6 | $672.7 | | **Diluted EPS** | $1.38 | $2.72 | $3.82 | $10.82 | [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20(Unaudited)) Total assets increased to **$11.89 billion** driven by acquisitions, with total liabilities and shareholders' equity also rising Balance Sheet Highlights (in millions) | Account | June 30, 2023 | September 30, 2022 | | :--- | :--- | :--- | | Cash and cash equivalents | $208.8 | $586.5 | | Goodwill | $4,649.0 | $4,349.6 | | Other intangible assets, net | $3,272.4 | $2,712.2 | | **Total Assets** | **$11,886.9** | **$11,308.0** | | Long-term debt | $6,186.1 | $5,956.6 | | **Total Liabilities** | **$7,927.1** | **$7,735.7** | | **Total Shareholders' Equity** | **$3,959.8** | **$3,265.7** | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20(Unaudited)) Operating cash flow significantly improved, while investing activities used more cash due to acquisitions, and financing activities included debt and share transactions Cash Flow Summary (in millions) | Cash Flow Activity | Nine Months Ended June 30, 2023 | Nine Months Ended June 30, 2022 | | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $480.5 | $218.1 | | Net Cash Used in Investing Activities | $(567.9) | $(133.1) | | Net Cash Used in Financing Activities | $(279.7) | $(635.9) | | **Net Decrease in Cash** | **$(363.3)** | **$(556.7)** | [Note 5 — Business Combinations](index=16&type=section&id=Note%205%20%E2%80%94%20BUSINESS%20COMBINATIONS) The company acquired Smucker's pet food business for **$1.21 billion** in cash and stock, contributing **$275.3 million** to net sales - The company acquired Smucker's pet food business (including brands like Rachael Ray Nutrish) for **$1,207.5 million**, comprising **$700.0 million** in cash and **$492.3 million** in Post common stock[63](index=63&type=chunk) Preliminary Purchase Price Allocation for Pet Food Acquisition (in millions) | Assets Acquired / Liabilities Assumed | Fair Value | | :--- | :--- | | Inventories | $204.6 | | Property, net | $191.7 | | Other intangible assets, net | $626.0 | | **Total identifiable net assets** | **$1,013.2** | | **Goodwill** | **$194.3** | | **Fair value of total consideration transferred** | **$1,207.5** | - The acquired Pet Food business contributed **$275.3 million** to net sales in the three and nine months ended June 30, 2023[64](index=64&type=chunk) [Note 15 — Long-Term Debt](index=24&type=section&id=Note%2015%20%E2%80%94%20LONG-TERM%20DEBT) Total long-term debt increased to **$6.19 billion**, with significant transactions including a new term loan and senior note repurchases Long-Term Debt Composition (in millions) | Debt Instrument | June 30, 2023 | September 30, 2022 | | :--- | :--- | :--- | | 2.50% convertible senior notes | $575.0 | $575.0 | | 4.50% senior notes | $1,129.3 | $1,270.5 | | 4.625% senior notes | $1,452.9 | $1,482.2 | | 5.50% senior notes | $1,235.0 | $1,235.0 | | Fourth Incremental Term Loan | $400.0 | — | | **Total Long-term debt (carrying value)** | **$6,186.1** | **$5,956.6** | - On April 26, 2023, the company borrowed **$400.0 million** via the Fourth Incremental Term Loan to fund the Pet Food acquisition[63](index=63&type=chunk)[129](index=129&type=chunk) - During the nine months ended June 30, 2023, the company repurchased **$141.2 million** of its 4.50% senior notes and **$29.3 million** of its 4.625% senior notes, resulting in a net gain on extinguishment of debt[134](index=134&type=chunk) [Note 19 — Segments](index=31&type=section&id=Note%2019%20%E2%80%94%20SEGMENTS) The company operates four segments, with Post Consumer Brands leading in sales and Foodservice being the most profitable with significant growth Segment Performance for Nine Months Ended June 30 (in millions) | Segment | Net Sales 2023 | Net Sales 2022 | Segment Profit 2023 | Segment Profit 2022 | | :--- | :--- | :--- | :--- | :--- | | Post Consumer Brands | $2,025.1 | $1,655.1 | $237.8 | $232.6 | | Weetabix | $377.2 | $360.5 | $58.8 | $81.8 | | Foodservice | $1,856.4 | $1,469.5 | $264.9 | $81.0 | | Refrigerated Retail | $786.4 | $787.4 | $57.2 | $41.0 | | **Total** | **$5,045.1** | **$4,272.5** | **$618.7** | **$436.4** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=33&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, highlighting increased net sales and operating profit driven by the Pet Food acquisition and Foodservice recovery [Overview](index=33&type=section&id=Overview) This section provides an overview of business segments, significant transactions, and market trends including supply chain challenges and avian influenza - On May 11, 2023, PHPC announced it would not complete a partnering transaction and would liquidate, resulting in the redemption of all public shares on May 30, 2023, and dissolution in June 2023[167](index=167&type=chunk)[169](index=169&type=chunk) - The company fully divested its remaining **14.2%** interest in BellRing Brands through two debt-for-equity exchanges, completing the final transaction on November 25, 2022[172](index=172&type=chunk)[174](index=174&type=chunk) - The company continues to face supply chain challenges and significant raw material and packaging inflation, mitigated by pricing actions, cost savings, and hedging, with pressures expected to continue through fiscal 2023[178](index=178&type=chunk) - Outbreaks of avian influenza in fiscal 2022 and early 2023 impacted the Foodservice and Refrigerated Retail segments, leading to increased costs and supply constraints, mitigated by volume management and pricing actions[181](index=181&type=chunk) [Results of Operations](index=38&type=section&id=Results%20of%20Operations) Net sales and operating profit significantly increased for both the quarter and nine-month period, driven by the Pet Food acquisition and Foodservice performance Overall Performance vs. Prior Year | Metric | Three Months Ended June 30, 2023 vs 2022 | Nine Months Ended June 30, 2023 vs 2022 | | :--- | :--- | :--- | | **Net Sales** | +$334.5M (+22%) | +$773.5M (+18%) | | **Operating Profit** | +$52.8M (+50%) | +$162.2M (+57%) | | **Net Earnings** | -$80.6M (-47%) | -$437.1M (-65%) | - Interest expense for the nine months ended June 30, 2023 decreased by **$43.2 million (18%)** year-over-year, driven by lower average debt balances and increased interest income from investments held in trust before the PHPC dissolution[189](index=189&type=chunk) [Segment Results](index=40&type=section&id=Segment%20Results) This section details segment performance, with Post Consumer Brands sales growing, Foodservice profit surging, Weetabix profit declining, and Refrigerated Retail profit improving Post Consumer Brands Performance (Q3 2023 vs Q3 2022) | Metric | Q3 2023 | Q3 2022 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $871.3M | $574.7M | +52% | | Segment Profit | $83.0M | $81.8M | +1% | - Post Consumer Brands' sales increase was primarily due to **$275.3 million** from the Pet Food acquisition, with volume declining **6%** excluding Pet Food due to lapping prior year competitor out-of-stocks in nut butters[203](index=203&type=chunk) Weetabix Performance (Q3 2023 vs Q3 2022) | Metric | Q3 2023 | Q3 2022 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $134.2M | $124.9M | +7% | | Segment Profit | $17.9M | $27.8M | -36% | - Weetabix's profit decline was driven by raw material inflation of **$10.6 million** and higher manufacturing costs of **$4.4 million**, not fully offset by price increases[210](index=210&type=chunk) Foodservice Performance (Q3 2023 vs Q3 2022) | Metric | Q3 2023 | Q3 2022 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $622.7M | $579.0M | +8% | | Segment Profit | $107.7M | $45.9M | +135% | - Foodservice profit surged due to higher net sales, lower freight costs (**$10.0 million**), and lower raw material costs (**$6.3 million**) from favorable grain and egg market prices[216](index=216&type=chunk) Refrigerated Retail Performance (Q3 2023 vs Q3 2022) | Metric | Q3 2023 | Q3 2022 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $230.7M | $246.4M | -6% | | Segment Profit | $18.0M | $10.4M | +73% | - Refrigerated Retail sales declined on **11%** lower volumes due to price elasticities, but profit increased due to pricing actions, lower manufacturing costs (**$7.2 million**), and lower freight costs (**$1.5 million**)[218](index=218&type=chunk)[220](index=220&type=chunk) [Liquidity and Capital Resources](index=44&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) Liquidity remains solid with operating cash flow increasing, while major cash uses included the Pet Food acquisition and share repurchases - Cash from operating activities increased by **$260.8 million** year-over-year, driven by favorable working capital changes and lower interest and swap payments[234](index=234&type=chunk) - Key financing activities in the first nine months of fiscal 2023 included: - Borrowing **$400.0 million** via a new term loan - Issuing **5.4 million** shares for the Pet Food acquisition - Repurchasing **2.9 million** shares for **$250.5 million** - Repurchasing **$170.5 million** in principal of senior notes at a discount[226](index=226&type=chunk) - As of June 30, 2023, the company was in compliance with all financial covenants under its Credit Agreement, which include a secured net leverage ratio and a minimum interest coverage ratio[240](index=240&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=48&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company manages market risks from commodity prices, foreign currency exchange rates, and interest rates using derivative instruments - A hypothetical **10%** adverse change in the market price of principal hedged commodities would have decreased the fair value of the commodity derivatives portfolio by approximately **$4 million** as of June 30, 2023[251](index=251&type=chunk) - A hypothetical **10%** adverse change in foreign currency exchange rates would have reduced the fair value of the foreign currency derivatives portfolio by approximately **$1 million** as of June 30, 2023[253](index=253&type=chunk) - As of June 30, 2023, the company had **$6.2 billion** in debt, of which **$5.8 billion** was at a fixed rate; a hypothetical **10%** adverse change in interest rates would have decreased the fair value of its interest rate swaps by approximately **$13 million**[254](index=254&type=chunk)[256](index=256&type=chunk) [Controls and Procedures](index=49&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of June 30, 2023, with ongoing integration of internal controls for the Pet Food business - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of June 30, 2023[257](index=257&type=chunk) - The company is in the process of analyzing and implementing changes in controls and procedures related to the Pet Food acquisition[258](index=258&type=chunk) [PART II. OTHER INFORMATION](index=50&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=50&type=section&id=Item%201.%20Legal%20Proceedings) The company resolved long-standing antitrust lawsuits related to egg products and expects other pending legal actions to have no material financial impact - In September 2022, the company's subsidiary MFI settled the final remaining claims in a long-running antitrust matter related to egg products; no expense was recorded for this matter in the current fiscal year as it was settled and paid in fiscal 2022[139](index=139&type=chunk)[140](index=140&type=chunk) - Management believes that the ultimate liability from other various pending legal proceedings will not be material to the company's consolidated financial condition, results of operations, or cash flows[141](index=141&type=chunk) [Risk Factors](index=50&type=section&id=Item%201A.%20Risk%20Factors) The company incorporates by reference prior risk factors, clarifying that existing food business risks now apply to the newly acquired Pet Food business - The company incorporates by reference the risk factors from its FY2022 Annual Report and Q2 2023 Quarterly Report[261](index=261&type=chunk) - Risks related to food for human consumption, the food and beverage category, and the industry should be read to include pet food, the pet food category, and the pet food industry, respectively, following the Pet Food acquisition[261](index=261&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=50&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased **1.93 million** shares for **$167.2 million** during the quarter and approved a new **$400.0 million** share repurchase authorization Share Repurchases for Quarter Ended June 30, 2023 | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 2023 | 77,003 | $87.74 | | May 2023 | 901,238 | $87.18 | | June 2023 | 947,210 | $86.03 | | **Total** | **1,925,451** | **$86.64** | - On June 6, 2023, the Board terminated the prior share repurchase plan and approved a new authorization to repurchase up to **$400.0 million** of common stock, effective June 7, 2023, and expiring June 7, 2025[262](index=262&type=chunk)

Post Holdings, Inc. (NYSE:POST) Q2 2023 Earnings Conference Call May 5, 2023 9:00 AM ET Company Participants Daniel O’Rourke – Investor Relations Rob Vitale – President and Chief Executive Officer Matt Mainer – Chief Financial Officer and Treasurer Conference Call Participants Andrew Lazar – Barclays David Palmer – Evercore Matt Smith – Stifel Michael Lavery – Piper Sandler Bill Chappell – Truist Jason English – Goldman Sachs Operator Thank you for standing by, and welcome to the Post Holdings Second Quarte ...