The Simply Good Foods pany(US:SMPL)2025-10-23 11:01Financial Performance - Fiscal Year 2025 net sales reached $1,450.9 million, a 9% increase compared to the previous year, driven by a 7.9% contribution from the OWYN acquisition and 3.0% organic growth[11]. - Fourth quarter net sales were $369.0 million, a decrease of $6.6 million or 1.8% year-over-year, impacted by a 6.9% headwind from lapping an extra week in the prior year[3]. - Adjusted EBITDA for Fiscal Year 2025 was $278.2 million, reflecting a 3.4% increase from $269.1 million in the prior year[19]. - The company reported a net loss of $12.4 million in the fourth quarter, compared to a net income of $29.3 million in the same period last year[8]. - Gross profit for the fourth quarter was $126.6 million, a decrease of 13.3% year-over-year, with gross margin at 34.3%, down 450 basis points due to elevated input costs[5]. - Net sales for the 52 weeks ended August 30, 2025, were $1,450,920,000, an increase of 9% compared to $1,331,321,000 for the previous year[39]. - Gross profit for the 52 weeks ended August 30, 2025, was $525,747,000, compared to $511,566,000 for the prior year, reflecting a gross margin improvement[39]. - The company reported a net loss of $12,357,000 for the 13 weeks ended August 30, 2025, compared to a net income of $29,291,000 for the same period last year[39]. - Adjusted EBITDA for the 52 weeks ended August 30, 2025, was $278,162,000, up from $269,130,000 in the prior year, indicating a growth of about 3%[44]. - Adjusted diluted earnings per share for the 52 weeks ended August 30, 2025, was $1.92, an increase from $1.83 in the previous year[46]. Cash Flow and Debt - Cash flow from operations was approximately $178.5 million, down from $215.7 million in the previous year, primarily due to higher working capital uses[22]. - Operating cash flow for the 52 weeks ended August 30, 2025, was $178,457,000, down from $215,704,000 in the previous year[41]. - Cash at the end of the period was $98,468,000, a decrease from $132,530,000 at the beginning of the period[41]. - The company's net debt as of August 30, 2025, was $151,532,000, with a net debt to adjusted EBITDA ratio of 0.5x[48]. - Total debt outstanding under the credit agreement was $250,000,000, with cash and cash equivalents of $98,468,000[48]. - Long-term debt decreased significantly to $249,066,000 from $397,485,000 year-over-year, indicating improved financial leverage[37]. Impairment and Losses - The company recognized a $60.9 million non-cash loss on impairment related to the Atkins brand, reflecting updated projections of future revenue[7]. - The company incurred a loss on impairment of $60,928,000 during the 52 weeks ended August 30, 2025, impacting overall profitability[39]. - The company experienced a loss on impairment of $60,928,000 for the 52 weeks ended August 30, 2025[44]. - The company reported a comprehensive loss of $12,247,000 for the 13 weeks ended August 30, 2025, compared to a comprehensive income of $29,493,000 for the same period last year[39]. Sales and Market Performance - Total retail takeaway for Simply Good Foods increased approximately 5%, driven by Quest and OWYN growth of about 12% and 34%, respectively, while Atkins declined about 10%[11]. - North America net sales for the 13 weeks ended August 30, 2025, totaled $362,260,000, a slight decrease from $367,305,000 for the same period in 2024[42]. - North America sales for the Quest brand increased to $233,169,000 in the 13 weeks ended August 30, 2025, compared to $216,961,000 in the same period of 2024, representing a growth of approximately 7%[42]. - International sales for the 52 weeks ended August 30, 2025, were $29,499,000, down from $32,728,000 in the previous year, indicating a decline of about 10%[42]. Future Outlook - The company expects net sales for Fiscal Year 2026 to range between -2% and +2% year-over-year, with gross margins expected to decline by 100 to 150 basis points[29]. - The company plans to expand its healthy lifestyle platform through innovation-driven organic growth and external investment opportunities[34]. - The Board of Directors approved a $150 million increase to the existing stock repurchase program, with $171 million available under the revised authorization[23].