Central Garden & Pet(US:CENT)2024-11-25 21:17Financial Performance - Fiscal 2024 net sales were $3.2 billion, a decrease of 3% from $3.3 billion in the prior year[3]. - Fiscal 2024 GAAP EPS was $1.62, down from $1.88 a year ago; non-GAAP EPS increased to $2.13 from $2.07[3][10]. - Pet segment net sales were $1.83 billion, a decrease of 2%; Garden segment net sales were $1.37 billion, a decrease of 5%[6]. - Operating income decreased by 12% to $185 million from $211 million in the prior year; non-GAAP operating income was $223 million compared to $227 million[8]. - Net income attributable to Central Garden & Pet for FY 2024 was $107,983 thousand, down from $125,643 thousand in FY 2023[50]. - The company reported a net loss of $34,158 thousand for the three months ended September 2024, compared to a net income of $2,835 thousand for the same period in 2023[51]. - Interest expense for FY 2024 was $37,872 thousand, compared to $49,663 thousand in FY 2023, indicating a decrease of 23.8%[50]. - The company experienced a decrease in net income from operations for FY 2024, reporting $185,387 thousand compared to $210,646 thousand in FY 2023[50]. Cash and Debt Management - Cash and cash equivalents increased to $754 million from $489 million a year ago, driven by inventory conversion to cash[21]. - Total debt remained at $1.2 billion, with a gross leverage ratio of 3.1x[22]. - Cash, cash equivalents, and restricted cash at the end of the year totaled $768,403 thousand, up from $502,873 thousand at the end of the previous year, marking a 52.7% increase[38]. - Total current assets increased to $1,886,806, up 10.5% from $1,707,123 in the previous year[36]. - Total liabilities increased to $1,878,978, up from $1,780,564 in the previous year[36]. Operational Efficiency - Gross margin expanded by 90 basis points to 29.5% from 28.6% in the prior year, driven by productivity efforts[7]. - Selling, general and administrative expenses increased to $201,360, up 7.4% from $188,084 in the previous year[37]. - The company reported depreciation and amortization of $90,807 thousand for the fiscal year ended September 28, 2024, compared to $87,700 thousand in the previous year, reflecting a 2.5% increase[38]. - The company recognized $45 million in non-GAAP charges in fiscal 2024, primarily related to Cost & Simplicity initiatives[23]. Segment Performance - The Pet segment's operating income decreased to $14 million from $43 million a year ago, reflecting lower volume and inventory impairment[18]. - The Pet segment reported a GAAP operating income of $14.3 million for Q4 fiscal 2024, compared to $43.2 million in Q4 fiscal 2023[47]. - The Garden segment experienced a GAAP operating loss of $28.8 million in Q4 fiscal 2024, compared to a loss of $3.4 million in Q4 fiscal 2023[47]. - Organic net sales for the Pet segment in FY 2024 were $1,766.4 million, down 5.9% from FY 2023's $1,877.2 million[48]. - Organic net sales for the Garden segment in FY 2024 were $1,367.7 million, a decrease of 1.2% from FY 2023's $1,384.8 million[48]. Future Outlook - Central expects fiscal 2025 non-GAAP EPS to be $2.20 or better, considering macroeconomic uncertainties[28]. - The company anticipates continued challenges in the market due to changing conditions and competition, impacting future performance[44]. - The company plans to focus on market expansion and new product development to drive future growth[49]. Non-GAAP Measures - Non-GAAP financial measures are utilized to provide additional insights into the company's performance, excluding specific items that may distort comparability between periods[39]. - Adjusted EBITDA for FY 2024 was $334,209 thousand, compared to $342,895 thousand in FY 2023, reflecting a decrease of 2.0%[50]. - Non-GAAP adjustments for FY 2024 totaled $37,432 thousand, compared to $16,559 thousand in FY 2023, showing an increase in adjustments[50].