Post(US:POST)2025-11-21 16:41Financial Performance - Net sales increased by $235.4 million, or 3%, to $8,158.1 million for the year ended September 30, 2025, driven by higher sales in the Foodservice segment [226]. - Operating profit rose by $5.8 million, or 1%, to $799.3 million, primarily due to higher segment profit in Foodservice and Refrigerated Retail segments [228]. - Net earnings decreased by $31.0 million, or 8%, to $335.7 million for the year ended September 30, 2025 [226]. - The Post Consumer Brands segment reported a net sales decline of $85.0 million, or 2%, to $4,024.6 million, impacted by lower pet food and cereal volumes [240]. - Segment profit for Post Consumer Brands decreased by $47.3 million, or 9%, to $493.9 million, primarily due to lower net sales and higher employee-related expenses [241]. - Net sales for the Foodservice segment increased by $333.9 million, or 14%, to $2,641.0 million for the year ended September 30, 2025, compared to the prior year [244]. - Segment profit for the Foodservice segment rose by $91.6 million, or 30%, to $399.7 million, driven by higher net sales, partially offset by $157.2 million in higher raw material costs [245]. - Net sales for the Refrigerated Retail segment decreased by $8.9 million, or 1%, to $953.3 million, primarily due to lower side dish and cheese volumes [247]. - Segment profit for the Refrigerated Retail segment increased by $12.4 million, or 16%, to $88.3 million, supported by higher average net selling prices and lower warehousing and freight costs [248]. Expenses and Costs - Interest expense increased by $44.9 million, or 14%, to $361.4 million, attributed to higher average outstanding debt and a higher weighted-average interest rate of 5.3% [229]. - General corporate expenses increased by $20.1 million, or 10%, to $221.8 million, primarily due to prior year gains lapsing and increased net losses on equity security investments [249]. - A goodwill impairment charge of $29.8 million was recorded related to the Cheese and Dairy reporting unit, with no such charges in the prior year [250]. - Inflationary pressures on certain input costs eased during fiscal 2025 and 2024, but other costs continued to face inflation, with expectations for this trend to continue into fiscal 2026 [276]. - The company anticipates continued inflationary pressures on input costs, which may impact operating margins and results of operations [276]. Cash Flow and Financing - Cash provided by operating activities increased by $66.6 million to $998.3 million, driven by lower tax payments, despite higher interest payments [265]. - Cash used in investing activities was $1,419.3 million, primarily due to net cash payments related to acquisitions and capital expenditures [267]. - Cash used in financing activities was $188.6 million, including $600.0 million from the issuance of senior notes and $709.0 million for share repurchases [269]. - The company expects to receive approximately $375.0 million in cash from the sale of the Pasta Business, expected to close in the first quarter of fiscal 2026 [253]. - Cash provided by financing activities for the year ended September 30, 2024, was $415.6 million, with total net repayments of debt amounting to $2,041.6 million [270]. - The company received proceeds of $1,200.0 million from the issuance of 6.375% senior notes and $1,000.0 million from 6.25% senior secured notes [270]. - The company repurchased 3.0 million shares of common stock at an average price of $101.74 per share, totaling $303.1 million, including accrued excise tax and broker's commissions [260]. - The company entered into a new revolving credit facility of $1,000.0 million, replacing the previous facility of $750.0 million, with a maturity date extended to February 20, 2029 [260]. - The company redeemed $464.9 million principal value of its 5.625% senior notes during fiscal 2025 [269]. - As of September 30, 2025, the company was in compliance with its financial covenants, maintaining a secured net leverage ratio not exceeding 4.25 to 1.00 [271]. Goodwill and Fair Value - A goodwill impairment charge of $42.2 million was recorded for the Cheese and Dairy reporting unit during the year ended September 30, 2023, and an additional charge of $29.8 million was recorded in fiscal 2025 [293]. - The estimated fair value of all indefinite-lived trademarks and brands exceeded book value by 13% or greater in fiscal 2025 and 9% or greater in fiscal 2024 [290]. - The Weetabix reporting unit's fair value exceeded its carrying value by approximately 8.7% as of fiscal 2025, impacted by cost inflation and U.K. economic pressures [295]. - A one percentage point decrease in assumed discount rates would have increased recorded benefit obligations by approximately $69 million for pensions and $5 million for other postretirement benefits [298]. - The fair value estimates for indefinite-lived intangible assets are based on significant assumptions regarding future revenue growth and discount rates [288]. - Changes in assumptions for estimating fair value could result in impairment charges in future periods [292]. - The company did not record a goodwill impairment charge during the year ended September 30, 2024, as all reporting units passed the quantitative test [294]. Market and Economic Conditions - The exchange rates used to translate foreign sales positively affected consolidated net sales by less than 1% during the year ended September 30, 2025 [279]. - The expected return on U.S. pension plan assets decreased from 7.00% to 6.00%, which would increase net periodic benefit cost by approximately $7 million [299]. - Approximately 1% of annual net sales represent variable consideration that will be resolved in the subsequent period [283]. - The company expects impacts on the Weetabix reporting unit's profitability to be transitory, despite inherent risks to cash flows [295].