Flowers Foods (FLO) Q1 2025 Prepared Remarks earnings summary

Executive summary

• Net sales for Q1 2025 declined 1.4% year-over-year to $1.554B, driven by softer volumes and negative price/mix, partially offset by the Simple Mills acquisition contribution of 1.6%.

• Net income dropped 27.4% to $53.0M, reflecting lower operating income, higher interest expense from acquisition funding, and a higher tax rate.

• Adjusted EBITDA rose 1.6% to $162.0M, with margin up 30 basis points to 10.4%, despite decreased net sales.

• The $848.5M Simple Mills acquisition expanded the snacking portfolio, contributed $24.3M in net sales, and resulted in a net loss of $4.2M in Q1.

• Each leading brand gained or held market share in tracked channels, with growth in premium, keto, and gluten-free segments.

Financial highlights

• Q1 2025 net sales: $1.554B (-1.4% vs. prior year); price/mix -0.3%, volume -2.7%, acquisition +1.6%.

• Net income: $53.0M (-27.4% vs. prior year); GAAP diluted EPS: $0.25 (-$0.09 vs. prior year); adjusted diluted EPS: $0.35 (-$0.03 vs. prior year).

• Adjusted EBITDA: $162.0M (+1.6% vs. prior year), margin up 30 bps to 10.4%.

• Operating cash flow: $135.6M; capital expenditures: $25.6M; dividends paid: $52.3M.

• Indebtedness increased by $776.6M, primarily to fund the Simple Mills acquisition.

Outlook and guidance

• Fiscal 2025 net sales expected at $5.297–$5.395B; adjusted EBITDA $534–$562M; adjusted diluted EPS $1.05–$1.15, all lowered from prior guidance.

• 53rd week projected to add $70–80M net sales, $5–7M adjusted EBITDA, and ~$0.02 adjusted EPS.

• Tariff impact estimate increased to $31–36M for 2025.

• Capital expenditures forecasted at $140–$150M; effective tax rate approx. 25%.

• Guidance reflects category weakness, higher tariffs, and ongoing consumer headwinds.