The Simply Good Foods pany(US:SMPL)2026-01-08 13:30Financial Performance - Net sales for the thirteen weeks ended November 29, 2025, were $340.2 million, a decrease of $1.1 million or 0.3% compared to $341.3 million for the same period in 2024, driven by declines in Atkins and OWYN, partially offset by growth in Quest[96]. - Gross profit decreased by $20.6 million or 15.8% to $109.9 million, with a gross profit margin of 32.3%, down 590 basis points from 38.2% in the prior year[98]. - Net income for the thirteen weeks ended November 29, 2025, was $25.3 million, a decrease of $12.9 million compared to $38.1 million for the same period in 2024[104]. - Adjusted EBITDA was $55.6 million, representing 16.4% of net sales, compared to $70.1 million or 20.5% in the prior year[96]. - Adjusted EBITDA decreased by $14.4 million, or 20.6%, to $55.6 million for the thirteen weeks ended November 29, 2025, compared to $70.1 million for the same period in 2024[105][108]. Cost and Expenses - Cost of goods sold increased by $19.5 million or 9.3% to $230.3 million for the thirteen weeks ended November 29, 2025, primarily due to higher ingredient and packaging costs[97]. - Operating expenses decreased by $3.5 million or 4.7% to $72.3 million, with selling and marketing expenses down by $3.3 million or 10.1%[99]. - Interest expense decreased by $3.6 million to $4.3 million, primarily due to principal payments reducing the outstanding balance of the Term Facility[102]. - Cash paid for interest decreased by $3.4 million to $4.1 million for the thirteen weeks ended November 29, 2025, compared to $7.5 million in the prior year[129]. - Depreciation and amortization expense increased to $6.2 million for the thirteen weeks ended November 29, 2025, from $5.0 million in the prior year[108]. Liquidity and Cash Flow - Net cash provided by operating activities increased by $18.1 million to $50.1 million for the thirteen weeks ended November 29, 2025, compared to $32.0 million for the same period in 2024[129]. - The Company believes its sources of liquidity and capital will be sufficient to finance operations and growth strategy for at least the next twelve months[110]. - The Company had $194.1 million in cash as of November 29, 2025[110]. - Net cash used in investing activities was $2.1 million for the thirteen weeks ended November 29, 2025, compared to $0.7 million for the same period in 2024[130]. - Net cash provided by financing activities was $47.6 million for the thirteen weeks ended November 29, 2025, compared to $42.3 million used in financing activities for the same period in 2024[131]. Shareholder Actions - The Company repurchased 4,983,514 shares of common stock at an average price of $19.99 per share during the thirteen weeks ended November 29, 2025, with $71.0 million remaining available for repurchases under the $300.0 million program[125][126]. - Common stock repurchases totaled $99.6 million for the thirteen weeks ended November 29, 2025[131]. Market and Operational Challenges - The company is facing pressure on gross margins due to higher commodity expenses and tariffs, with expectations for improvement as pricing actions and productivity initiatives take effect[87]. - The company continues to monitor macroeconomic trends, including inflation and supply chain challenges, which may adversely affect net sales and profitability[88]. - The company is focused on bolstering high-performing Atkins products while replacing lower-performing items with higher-performing Quest and OWYN products[86]. - There were no material changes in market risk exposure during the thirteen-week period ended November 29, 2025[134].