Freshpet(US:FRPT)2025-11-03 21:08Financial Performance - For the three months ended September 30, 2025, net sales increased to $288.848 million, up 14% from $253.367 million in the same period of 2024[13] - Gross profit for the nine months ended September 30, 2025, was $326.170 million, representing a 14.7% increase compared to $284.357 million for the same period in 2024[13] - The company reported an income attributable to common stockholders of $101.663 million for the three months ended September 30, 2025, compared to $11.895 million for the same period in 2024[13] - Net income for the nine months ended September 30, 2025, was $105,322 thousand, compared to $28,803 thousand for the same period in 2024, representing a significant increase[19] - Consolidated net income for the nine months ended September 30, 2025, was $105,322,000, compared to $28,802,000 for the same period in 2024, representing a significant increase[110] Assets and Liabilities - Total assets as of September 30, 2025, were $1.746 billion, an increase from $1.575 billion as of December 31, 2024[11] - Current liabilities decreased to $76.748 million as of September 30, 2025, from $98.869 million as of December 31, 2024[11] - The company’s total stockholders' equity increased to $1.178 billion as of September 30, 2025, from $1.055 billion as of December 31, 2024[11] - The company’s accumulated deficit improved to $(176.484) million as of September 30, 2025, from $(281.806) million as of December 31, 2024[11] - As of September 30, 2025, total lease liabilities were $98,029,000, significantly higher than $28,928,000 as of December 31, 2024, representing an increase of 239%[86] Expenses - Selling, general, and administrative expenses for the nine months ended September 30, 2025, were $294.961 million, compared to $265.734 million for the same period in 2024[13] - The company incurred $95,134 thousand in cash flows used in investing activities for the nine months ended September 30, 2025, compared to $128,828 thousand in 2024, indicating a reduction in capital expenditures[19] - Share-based compensation expense for the nine months ended September 30, 2025, was $20,256 thousand, down from $37,862 thousand in 2024[19] - The company’s depreciation and amortization expenses increased to $66,798 thousand for the nine months ended September 30, 2025, from $52,249 thousand in 2024[19] - Total compensation cost for share-based payments for the nine months ended September 30, 2025, was $20,256,000, down from $35,835,000 in 2024, indicating a decrease of 43%[88] Cash Flow - Cash flows provided by operating activities for the nine months ended September 30, 2025, were $105,455 thousand, slightly up from $103,919 thousand in 2024[19] - The company had cash and cash equivalents of $274,591 thousand at the end of the reporting period, compared to $274,594 thousand at the end of the previous year[19] - Cash paid for operating lease liabilities for the nine months ended September 30, 2025, was $3,054,000, compared to $1,266,000 in 2024, reflecting an increase of 141%[86] Tax and Valuation - The effective tax rate for the three months ended September 30, 2025, was -328.9%, significantly impacted by the release of a valuation allowance of $77.9 million[58] - The company reported a deferred income tax benefit of $77.9 million for the three and nine months ended September 30, 2025, due to the release of the valuation allowance[60] - The company continues to maintain a valuation allowance of $7,800,000 against certain deferred tax assets, primarily related to foreign net operating losses[61] Risks and Market Conditions - The company continues to face risks including supply chain management and potential price increases due to inflation and agricultural disruptions[9] - The company is exposed to commodity price volatility, which could impact operating costs as a percentage of net sales[190] - Major customers accounted for 26% of net sales for the three months ended September 30, 2025, consistent with the same percentage in 2024[96] Lease 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[32] - The carrying value of the convertible notes as of September 30, 2025, was $396,781 thousand, while the fair value was $450,102 thousand, reflecting a premium of approximately 13.4%[71] - The effective interest rate for the convertible notes is 3.59%, with total interest expense for the three months ended September 30, 2025, amounting to $3,563 thousand[70] - The Company has various noncancelable operating lease agreements with a total present value of lease liabilities of $67,236 thousand as of September 30, 2025[82] Other Financial Metrics - The basic net income per share attributable to common stockholders for the three months ended September 30, 2025, was $2.08, compared to $0.25 for the same period in 2024[13] - Diluted net income per share for the three months ended September 30, 2025, was $1.86, compared to $0.24 in 2024, representing a growth of 675%[93] - Input costs for the three months ended September 30, 2025, were $84,087,000, up from $74,984,000 in 2024, indicating a 12% rise[110] - Media costs increased to $32,456,000 for the three months ended September 30, 2025, compared to $27,240,000 in 2024, reflecting a 19% increase[110] - Depreciation and amortization expenses rose to $24,362,000 for the three months ended September 30, 2025, from $18,341,000 in 2024, a 33% increase[110]