Core Viewpoint - TreeHouse Foods (THS) is expected to report a year-over-year decline in earnings due to lower revenues, with a consensus estimate indicating a quarterly loss of $0.21 per share, representing a -600% change from the previous year [1][3]. Earnings Expectations - The upcoming earnings report is anticipated to be released on May 6, and the stock may rise if actual results exceed expectations, while a miss could lead to a decline [2]. - Revenues for the quarter are projected to be $789.6 million, down 3.8% from the same quarter last year [3]. Estimate Revisions - The consensus EPS estimate has been revised 11.01% lower in the last 30 days, reflecting a reassessment by analysts [4]. - The Most Accurate Estimate for TreeHouse is higher than the Zacks Consensus Estimate, resulting in a positive Earnings ESP of +63.42%, indicating a bullish outlook from analysts [10][11]. Earnings Surprise Prediction - The Zacks Earnings ESP model suggests that a positive reading is a strong predictor of an earnings beat, especially when combined with a Zacks Rank of 1, 2, or 3 [8]. - TreeHouse currently holds a Zacks Rank of 3, suggesting a likelihood of beating the consensus EPS estimate [11]. Historical Performance - In the last reported quarter, TreeHouse was expected to post earnings of $0.97 per share but delivered $0.95, resulting in a surprise of -2.06% [12]. - Over the past four quarters, the company has only beaten consensus EPS estimates once [13]. Industry Comparison - BellRing Brands (BRBR), another player in the food industry, is expected to report earnings per share of $0.52 for the same quarter, reflecting a year-over-year increase of +15.6% [17]. - BellRing's revenues are projected to be $575.94 million, up 16.5% from the previous year, with a positive Earnings ESP of 2.95% and a Zacks Rank of 2, indicating a strong likelihood of beating the consensus EPS estimate [18].

Core Viewpoint - TreeHouse Foods, Inc. is implementing internal restructuring actions to enhance operational efficiency while reaffirming its financial outlook for fiscal 2025, projecting adjusted net sales between $3.34 billion and $3.40 billion, and adjusted EBITDA from continuing operations ranging from $345 million to $375 million [1][2]. Financial Projections - The company expects adjusted net sales for the first quarter of fiscal 2025 to reach at least $792 million, with adjusted EBITDA projected at a minimum of $52 million [2]. - The financial guidance for fiscal 2025 includes a partial-year benefit from recent cost-saving measures, with full impact expected to be realized gradually through fiscal years 2025 and 2026 [2]. Organizational Changes - TreeHouse Foods is reorganizing its internal operations, eliminating about 150 corporate roles and removing a key leadership position to streamline operations [5][6]. - The exit of Executive Vice President Scott Tassani by the end of May will not be followed by refilling his position, aiming to reduce overhead costs and accelerate decision-making processes [5][6]. Market Conditions - The company is monitoring global trade conditions and tariff uncertainties, which could impact its business, noting that approximately 5% of its net sales in 2024 came from international markets, primarily Canada [3][6]. - Almost all finished goods currently comply with USMCA, indicating a focus on regulatory compliance in trade [3]. Performance Context - TreeHouse Foods' shares have decreased by 35.2% over the past three months, contrasting with the industry's growth of 3% [8].

Core Viewpoint - TreeHouse Foods, Inc. is implementing operational efficiency measures to enhance profitability and cash flow, while reaffirming its financial guidance for 2025 [1][3]. Financial Performance - The company expects preliminary first quarter 2025 Adjusted net sales of at least $792 million and Adjusted EBITDA of at least $52 million [1][3]. - TreeHouse Foods reaffirmed its 2025 financial guidance, projecting adjusted annual net sales between $3.34 billion and $3.40 billion, and adjusted EBITDA from continuing operations between $345 million and $375 million [3]. Organizational Changes - The company is streamlining its organizational structure, which includes the departure of Scott Tassani, Executive Vice President, and the elimination of approximately 150 roles [2][3]. - The reorganization aims to support faster decision-making and increased efficiencies within the company [3]. Strategic Focus - The company is focusing on improving execution and consistency to better serve customers and drive profitability [2]. - TreeHouse Foods is centralizing and reorganizing its corporate support functions as part of its operational enhancement actions [2][3]. Market Position - In 2024, approximately 5% of TreeHouse Foods' net sales came from customers outside the United States, primarily in Canada [4]. - The company is ensuring compliance with USMCA for nearly all finished goods [4].

Acquisitions and Divestitures - TreeHouse Foods completed the acquisition of Harris Tea, a leading private brand tea manufacturer, on January 2, 2025, aligning with its strategy to enhance capabilities in higher-growth categories [19]. - TreeHouse acquired pickle branded assets from The J.M. Smucker Co. on January 2, 2024, expanding its presence in the Pickles category into Canada [21]. - The company completed the acquisition of the Direct Ship coffee business from Farmer Brothers Company on June 30, 2023, enhancing its coffee product offerings [23]. - The Snack Bars business was sold on September 29, 2023, as part of a strategic review process, which also included the divestiture of a significant portion of the Meal Preparation business in 2022 [22][25]. - The company completed the acquisition of pickle branded assets for $25.9 million on January 2, 2024, expanding its presence in the Pickles category in Canada [140]. - The company completed the sale of its Snack Bars business for approximately $58.7 million in cash on September 29, 2023, resulting in a gain on disposal of $1.1 million [189]. - The company recognized an impairment of $19.3 million related to the RTD beverages asset group due to forecasted cash flow losses [186]. Financial Performance - Net sales for the year ended December 31, 2024, totaled $3,354.0 million, a decrease of $77.6 million or 2.3% compared to $3,431.6 million in 2023 [150]. - Gross profit as a percentage of net sales was 16.4% for 2024, down from 16.8% in 2023, primarily due to a voluntary recall impacting gross profit by 1.1 percentage points [152]. - Total operating expenses increased to $445.3 million in 2024 from $429.2 million in 2023, an increase of $16.1 million [153]. - Total other expense rose to $70.0 million in 2024, up from $63.5 million in 2023, primarily due to a decrease in interest income and unfavorable currency exchange impacts [154]. - Net income from continuing operations was $26.9 million in 2024, a decrease of $32.1 million or 54.4% compared to $59.0 million in 2023 [150]. - Adjusted EBITDA from continuing operations was $337.4 million in 2024, down from $365.9 million in 2023, a decrease of $28.5 million or 7.8% [149]. - The Company reported net sales of $3,354.0 million for the year ended December 31, 2024, with an adjusted net sales figure of $3,377.3 million [214]. - The gross profit as reported was $548.4 million, representing 16.4% of net sales, while the adjusted gross profit was $593.4 million, or 17.6% of adjusted net sales [214]. - The diluted earnings per share from continuing operations was $0.51, while the adjusted diluted earnings per share was $1.91 [214]. Customer Concentration - TreeHouse's ten largest customers accounted for approximately 57.1% of consolidated net sales in 2024, with Walmart Inc. representing 23.9% of those sales [30]. - For the year ended December 31, 2024, the company's ten largest customers accounted for approximately 57.1% of consolidated net sales, with Walmart Inc. and its affiliates representing about 23.9% [57]. Supply Chain and Operational Efficiency - The company is focused on building a world-class supply chain and investing in innovation pipelines to drive growth and category leadership [29]. - Recent macroeconomic challenges have softened private brands consumption, but the company aims to enhance supply chain efficiency to maximize profitable growth [32]. - The company has made considerable progress toward its long-term supply chain cost savings initiative goals, resulting in margin improvement [143]. - Industry-wide supply chain disruptions have improved, allowing the company to enhance service levels and capture demand for private brand food and beverage [143]. - The company continues to monitor elevated ingredient and packaging input costs, implementing pricing actions to recover inflationary costs as necessary [144]. Employee Relations and Development - As of December 31, 2024, the company employed approximately 7,400 full-time employees, with 6,000 in the United States and 1,400 in Canada [44]. - The company emphasizes a strong focus on employee learning and development, offering over 10,000 courses through its internal platform, DevelopU [48]. - The company has not experienced material interruptions in operations due to employee disputes and considers employee relations satisfactory [44]. - The company is committed to competitive pay and benefits, including a 401(k) retirement plan with matching contributions for U.S. employees [49]. - The company faces risks from labor shortages and increased labor costs, which have negatively impacted profitability [56]. Risks and Challenges - The company is dependent on third-party suppliers for manufacturing and packaging, which poses risks to operating results if not managed effectively [53]. - The company is subject to various risks, including supply chain disruptions and product liability claims, which could materially affect its financial condition [51]. - The company may face increased contributions to multiemployer pension plans due to a shrinking contribution base, which could adversely affect financial results [68]. - The company’s ability to service its debt may be limited by its financial condition and operating performance, which are subject to various external factors [81]. - The company faces significant competition in the food industry, which may require price reductions or increased marketing expenditures, adversely affecting margins and profitability [70]. - Input costs, including ingredients and packaging materials, have seen significant inflation, which could adversely affect earnings and operating margins [73]. - The company is exposed to fluctuations in foreign currency exchange rates, particularly with its Canadian subsidiaries, which may negatively impact earnings due to transaction gains and losses [87]. - The company’s operations are subject to risks associated with acquisitions and divestitures, which could impact financial results and business reputation [98]. - The company’s supply chain may be adversely affected by climate change, leading to increased costs for raw materials and potential disruptions in production [90]. Shareholder Activities - The company has experienced shareholder activism, which could result in significant costs and impact stock price [94]. - The company has authorized a $400 million stock repurchase program, replacing the previous authorization of $400 million from 2017, with $393.5 million remaining available for repurchases [119]. - The company repurchased 4.1 million shares of common stock for a total of $149.7 million during the year ended December 31, 2024 [119]. - The company repurchased approximately 1.7 million shares of common stock for a total of $61.0 million during the quarter ended December 31, 2024, at a weighted average price of $36.39 per share [120]. - The Company had 1,530 shareholders of record as of January 31, 2025, and does not anticipate paying cash dividends in the foreseeable future [117]. Environmental and Regulatory Commitments - The company has established a culture of Environmental, Health, and Safety (EHS) excellence, integrating safety into its management operating system [46]. - The company may face increased compliance costs and capital expenditures due to new regulations related to greenhouse gas emissions and water conservation [91]. - The company has made public commitments to reduce carbon emissions, which may require significant resources and could increase operational costs [93]. Debt and Financial Obligations - The company had $1,409.1 million of outstanding indebtedness as of December 31, 2024, including a $588.6 million term loan maturing on March 26, 2026, and $500.0 million of 4.0% notes due September 1, 2028 [81]. - The Company had $316.4 million outstanding under Term Loan A and $588.6 million under Term Loan A-1 as of December 31, 2024 [171]. - Estimated future interest payments on the Company's debt are expected to be $180.3 million, with $73.8 million due in 2025 [181]. - Long-term debt outstanding increased to $1,409.1 million as of December 31, 2024, from $1,405.6 million in 2023, driven by a $3.5 million rise in finance lease obligations [170]. - Capital expenditures for 2025 are estimated at approximately $125 million, following $139.7 million in 2024 [181].

Financial Data and Key Metrics Changes - For Q4 2024, adjusted net sales were $911.4 million and adjusted EBITDA was $118.3 million, both in line with expectations, reflecting almost 4% growth in the period [11][12] - For the full fiscal year 2024, adjusted net sales were $3.38 billion and adjusted EBITDA was $337 million, also meeting updated expectations [12][33] - Adjusted EBITDA margin rose to 13% in Q4 2024, driven by procurement savings [24] Business Line Data and Key Metrics Changes - Adjusted net sales increased by 0.2% year-over-year, primarily driven by a 3.8% increase in volume and mix, particularly in pretzels, in-store bakery, cookies, and broth [26] - The frozen griddle facility restoration negatively impacted sales by 2% [26] - Pricing adjustments due to commodity costs had a headwind of about 70 basis points [26] Market Data and Key Metrics Changes - Private brand unit sales experienced a sharp deceleration in Q4 2024, attributed to macroeconomic pressures affecting the broader food and beverage market [13] - Despite weaker consumption, private brands maintained market share, with promotional activity expected to increase due to industry volume softness [15][16] Company Strategy and Development Direction - The acquisition of Harris Tea strengthens the company's position in the private label tea category and enhances blending and sourcing capabilities [10] - The company plans to focus on supply chain performance and cost structure management to improve profitability and competitiveness [18][20] - A commitment to achieving $250 million in gross supply chain savings through 2027 is emphasized [19] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenging macro food environment and anticipates a flat top-line outlook for 2025, with adjusted net sales guidance of $3.34 billion to $3.4 billion [31][32] - The company expects a decline in organic volume mix of approximately 1% due to various factors, including the impact of the frozen griddle product recall [32] - Management remains optimistic about long-term growth opportunities in private brands and snacking categories [16][18] Other Important Information - The company achieved $60 million in gross savings from supply chain cost-saving initiatives in 2024 [28][77] - Capital expenditures are expected to moderate moving forward as the company completes carryover projects from the previous year [30][79] Q&A Session Summary Question: What would you attribute the sequential slowdown in underlying volume to? - Management noted that the ramp-up of the broth facility and category deceleration contributed to the slowdown [43][44] Question: How does the company view the current industry challenges? - Management believes the current challenges are temporary and sees an opportunity to reset and rethink business operations [49][50] Question: Can you elaborate on margin management actions and their impact on volume? - Management indicated that margin management may lead to a slight volume drag but will improve cost efficiency [60][62] Question: What is the expected cadence of supply chain cost-saving programs in 2025? - Management expects a slightly lower contribution from procurement savings in 2025 but anticipates ongoing improvements in manufacturing and logistics [77][78] Question: How does the company plan to handle promotional activity in a low-volume environment? - Management expects promotional activity to increase as brands seek to drive volume, but believes the value proposition for private label remains strong [108][109] Question: What is the outlook for commodity inflation in 2025? - Management anticipates low to mid-single-digit inflation for commodities, particularly in coffee and cocoa [132][133]

Q4 2024 and FY 2024 Performance - Q4 2024 Adjusted Net Sales reached $911 million and Adjusted EBITDA was $118 million, aligning with expectations[5] - FY24 Adjusted Net Sales were $338 billion, and Adjusted EBITDA was $337 million[10] - Q4 2024 Adjusted EBITDA margin was 130%, a 110 bps increase year-over-year[12, 35] - The company closed FY 2024 with Net Debt to Adjusted EBITDA of approximately 33x[44] 2025 Outlook - The company anticipates 2025 Adjusted EBITDA to be in the range of $345 million to $375 million, with flat Net Sales at the midpoint, and Free Cash Flow of at least $130 million[5] - The company projects 2025 Adjusted Net Sales to be between $3340 billion and $3400 billion, representing approximately -10% to +10% growth[48] - The company expects capital expenditures of approximately $125 million in 2025[48] Strategic Initiatives and Acquisitions - The company successfully executing supply chain, margin management and other efficiency initiatives to drive profitability improvement[5] - The company completed the acquisition of Harris Tea, which is expected to increase Net Sales by roughly 4% and Adjusted EBITDA in 2025[9] Griddle Business Update - The company initiated a voluntary recall of frozen griddle products manufactured at the Brantford, Ontario, Canada facility in October 2024[7] - The company began shipping frozen griddle product in Q1 2025, but no financial contribution is anticipated in the period[7]

Group 1 - TreeHouse Foods reported quarterly earnings of $0.95 per share, missing the Zacks Consensus Estimate of $0.97 per share, but showing an increase from $0.77 per share a year ago, resulting in an earnings surprise of -2.06% [1] - The company posted revenues of $905.7 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 0.09%, although this represents a decline from year-ago revenues of $910.8 million [2] - Over the last four quarters, TreeHouse has surpassed consensus revenue estimates three times, but has only exceeded consensus EPS estimates once [2] Group 2 - TreeHouse shares have underperformed the market, losing about 5.3% since the beginning of the year, while the S&P 500 has gained 4% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The current consensus EPS estimate for the coming quarter is $0.16 on revenues of $829.15 million, and for the current fiscal year, it is $2.45 on revenues of $3.4 billion [7] Group 3 - The Zacks Industry Rank indicates that the Food - Miscellaneous sector is currently in the bottom 29% of over 250 Zacks industries, which may negatively impact stock performance [8] - The estimate revisions trend for TreeHouse is currently favorable, leading to a Zacks Rank 2 (Buy) for the stock, suggesting it is expected to outperform the market in the near future [6]

Financial Performance - TreeHouse Foods reported fourth quarter net sales of $905.7 million, a decrease of 0.6% compared to $910.8 million in the same period last year[4]. - Adjusted EBITDA for the fourth quarter was $118.3 million, an increase of $9.9 million from $108.4 million in the fourth quarter of 2023[9]. - The company expects fiscal year 2025 adjusted net sales in the range of $3.340 billion to $3.400 billion, reflecting a year-over-year decline of approximately 1% to growth of approximately 1%[3]. - Gross profit margin for the fourth quarter increased to 19.5%, up 2.8 percentage points from 16.7% in the fourth quarter of 2023[5]. - Net income from continuing operations for the fourth quarter was $58.7 million, compared to $6.4 million in the fourth quarter of 2023[9]. - Operating income increased to $80.5 million for the three months ended December 31, 2024, compared to $42.1 million in the same period of 2023, representing a significant improvement[30]. - Net income from continuing operations for the twelve months ended December 31, 2024, was $26.9 million, compared to $59.0 million in 2023, indicating a decline[30]. - EBITDA from continuing operations for the twelve months ended December 31, 2024, was $239.4 million, down 7.9% from $260.0 million in 2023[35]. - Adjusted EBITDA from continuing operations for the year ended December 31, 2024, was $337.4 million, a decrease of 7.8% compared to $365.9 million in 2023[35]. - The company reported a significant increase in net sales for the twelve months ended December 31, 2024, totaling $3,354.0 million, with a gross profit of $548.4 million[47]. Cash Flow and Capital Expenditures - The company generated $265.8 million in net cash from operating activities in 2024, an increase of $108.5 million from $157.3 million in 2023[10]. - The company anticipates free cash flow of at least $130 million for fiscal year 2025[12]. - Free cash flow from continuing operations increased to $126.1 million for the twelve months ended December 31, 2024, compared to $16.5 million in 2023[51]. - Cash flow provided by operating activities from continuing operations rose to $265.8 million, up from $157.3 million year-over-year[51]. - Capital expenditures for the year ended December 31, 2024, were $139.7 million, slightly down from $140.8 million in 2023[32]. - Capital expenditures were reported at $139.7 million for the twelve months ended December 31, 2024[51]. Shareholder Actions - TreeHouse repurchased approximately 1.7 million shares for $61.0 million during the fourth quarter, with a total of 4.1 million shares repurchased for $149.7 million in 2024[11]. Assets and Liabilities - Total assets decreased to $3,980.0 million as of December 31, 2024, from $4,106.6 million in 2023, indicating a reduction in overall asset base[28]. - Current liabilities increased to $744.9 million as of December 31, 2024, compared to $704.3 million in 2023, reflecting a rise in short-term obligations[28]. - The company reported a decrease in accumulated deficit to $(222.0) million in 2024 from $(248.9) million in 2023, showing improvement in retained earnings[28]. Interest and Expenses - Interest expense for the twelve months ended December 31, 2024, was $63.4 million, down from $74.8 million in 2023, indicating reduced borrowing costs[30]. - Interest paid decreased to $85.2 million in 2024 from $93.7 million in 2023, reflecting a reduction of 9.6%[33]. - Operating expenses totaled $429.2 million, representing 12.5% of net sales[49]. Product Recalls and Impairments - The company incurred product recall-related costs of $36.6 million for the twelve months ended December 31, 2024, compared to $27.0 million in 2023[38]. - The company experienced product recalls and related costs impacting net income, with adjustments totaling $23.3 million for the three months ended December 31, 2023[46]. - The company recognized $19.3 million in non-cash impairment charges related to property, plant, and equipment during the second quarter of 2024[41]. - The company incurred product recalls and related costs of $1.3 million, impacting overall profitability[49]. Earnings Per Share - Earnings per share from continuing operations were reported at $1.15 diluted and $0.95 adjusted diluted for the three months ended December 31, 2024[45]. - Earnings per share from continuing operations for the twelve months ended December 31, 2024, were reported at $0.51 diluted and $1.91 adjusted diluted[47]. Operational Focus - TreeHouse Foods is focused on operational efficiencies and long-term growth prospects in its categories, aiming to enhance service and capabilities for profitable growth[24].

Fourth Quarter Net Sales and Adjusted EBITDA Met Guidance TreeHouse delivered fiscal year 2024 results: Net sales were $3,354.0 million Net income from continuing operations of $26.9 million Adjusted EBITDA1 was $337.4 million Fourth quarter results included: Net sales of $905.7 million Net income from continuing operations of $58.7 million Adjusted EBITDA1 of $118.3 million Issued initial fiscal year 2025 outlook for adjusted net sales in a range of $3.340 billion to $3.400 billion, adjusted EBITDA2 in ...

TreeHouse Foods, Inc. (THS) is likely to witness a top-line decline when it reports fourth-quarter 2024 earnings on Feb. 14. The Zacks Consensus Estimate for revenues is pegged at $904.85 million, indicating a 0.7% decrease from the prior-year quarter’s reported figure.The consensus mark for earnings has remained unchanged in the past 30 days at 97 cents per share, which suggests a 26% jump from the figure reported in the year-ago quarter. THS has a trailing four-quarter earnings surprise of 20.4%, on avera ...