BellRing Brands (BRBR) Q3 2024 earnings summary

Executive summary

• Net sales for Q3 2024 increased 16% year-over-year to $515.4 million, driven by strong Premier Protein volume growth, record household penetration, and distribution gains, while Dymatize saw a slight sales decline.

• Net earnings rose 66% to $73.7 million, with operating profit up 47% to $111.6 million, reflecting lower raw material costs and higher sales.

• Gross profit margin improved to 36.8%, up 630 basis points year-over-year, aided by input cost deflation and commodity hedge gains.

• Management raised full-year 2024 net sales and adjusted EBITDA guidance, citing strong Q3 performance and improved visibility.

• Premier Protein led growth with 20% net sales increase, strong volume gains, and all-time high household penetration; Dymatize international sales rose 18% despite domestic softness.

Financial highlights

• Q3 net sales: $515.4 million (+15.6% YoY); operating profit: $111.6 million (+46.8% YoY); net earnings: $73.7 million (+66.4% YoY).

• Q3 Adjusted EBITDA: $120 million (+38% YoY); gross profit: $190 million (+40% YoY); gross margin: 36.8%.

• Q3 diluted EPS: $0.56 (+69.7% YoY); Adjusted diluted EPS: $0.54 (+58.8% YoY).

• Cash flow from operations was $69 million for the quarter and $160 million year-to-date.

• Net debt at quarter-end was $776 million, with net leverage at 1.8x.

Outlook and guidance

• FY2024 net sales guidance raised to $1.96–$2.00 billion; Adjusted EBITDA guidance raised to $430–$440 million.

• Projected FY2024 growth: net sales +18–20%, Adjusted EBITDA +27–30% over FY2023.

• Q4 net sales expected to grow 14% at midpoint, with Premier Protein as the main driver; Dymatize and others to be flat year-over-year.

• Fourth quarter gross margins expected to improve year-over-year, but adjusted EBITDA margins to be slightly down due to higher marketing spend.

• Initial fiscal 2025 outlook targets high end of 10%-12% long-term net sales growth algorithm.