Farmer Bros. (US:FARM)2025-11-06 21:58Financial Performance - Net sales for the three months ended September 30, 2025, decreased by $3.5 million, or 4.1%, to $81.6 million compared to $85.1 million in the same period of 2024[110]. - Gross profit decreased to $32.4 million for the three months ended September 30, 2025, down from $37.3 million in the prior year, with gross margin declining to 39.7% from 43.9%[112]. - Net loss for the three months ended September 30, 2025, was $4.0 million, a 19.5% improvement from a net loss of $5.0 million in the same period of 2024[109]. - EBITDA improved by $0.7 million to a loss of $0.8 million for the three months ended September 30, 2025, compared to a loss of $1.4 million in the prior year[105]. - For the three months ended September 30, 2025, the company reported a net loss of $4.025 million, an improvement from a net loss of $5.002 million in the same period of 2024[123]. - Adjusted EBITDA for the three months ended September 30, 2025, was $1.364 million, compared to $1.417 million in 2024, with an Adjusted EBITDA Margin of 1.7% for both periods[124]. Operating Expenses - Operating expenses decreased by $4.5 million to $35.6 million, representing 43.6% of net sales, down from 47.2% in the prior year[113]. - Selling expenses decreased by $1.4 million, while general and administrative expenses decreased by $2.5 million in the three months ended September 30, 2025[113]. - Interest expense decreased by $0.5 million to $1.3 million for the three months ended September 30, 2025, primarily due to lower pension-related interest costs[115]. Sales and Pricing - Average unit price increased by 7.7% while unit sales decreased by 10.9% in the three months ended September 30, 2025, contributing to the overall decline in net sales[111]. - The company did not introduce any new product categories that materially impacted net sales during the three months ended September 30, 2025[111]. Cash Flow and Capital Expenditures - Net cash used in operating activities was $5.007 million for the three months ended September 30, 2025, a decrease of $7.5 million compared to net cash provided of $2.493 million in 2024[138]. - Total capital expenditures for the three months ended September 30, 2025, were $1.9 million, a decrease of 42.0% from $3.3 million in the prior year[105]. - Capital expenditures for the three months ended September 30, 2025, were $1.9 million, down from $3.3 million in the same period of 2024[141]. - The company anticipates paying between $9.0 million to $11.0 million in capital expenditures in fiscal 2026, financed through cash flows from operations and borrowings[141]. Inventory and Borrowings - The company had outstanding borrowings of $18.3 million on its Revolver Credit Facility as of September 30, 2025, with a weighted average interest rate of 6.15%[132]. - The company had committed to purchase green coffee inventory totaling $31.6 million under fixed-price contracts as of September 30, 2025[143]. - As of September 30, 2025, the company had $3.8 million in unrestricted cash and cash equivalents, and $31.2 million available on its Revolver Credit Facility[136]. Market Conditions - The company continues to monitor macroeconomic trends, including product cost inflation and tariff impacts, which may adversely affect net sales and profitability[130]. - The company operates a nationwide DSD network with over 200 delivery routes and over 90 storage locations as of September 30, 2025[129].