The Simply Good Foods Company (SMPL) Q4 2024 earnings summary

Executive summary

• Fiscal Q4 2024 net sales rose 17.2% to $375.7 million, driven by the OWYN acquisition, which contributed up to 9.1 percentage points, and an extra week in the period.

• Adjusted EBITDA for Q4 was $77.5 million, up 15% year-over-year; full-year Adjusted EBITDA was $269.1 million, up 9.6%.

• Full-year 2024 net sales reached $1.33 billion, a 7.1% increase, with net income rising to $139.3 million from $133.6 million.

• Q4 net income was $29.3 million, down from $36.6 million last year due to higher expenses and acquisition costs.

• OWYN integration is progressing as planned, with strong performance across all major retail customers and channels.

Financial highlights

• Q4 gross profit was $146 million, up $25.5 million, with gross margin at 38.8%, a 120 bps increase; full-year gross profit was $511.6 million, gross margin at 38.4%, up 190 bps.

• Q4 adjusted EPS was $0.50, up from $0.45; full-year adjusted EPS was $1.83, up from $1.63.

• Q4 operating expenses rose $33.4 million to $98.1 million, mainly from higher marketing, G&A, and OWYN inclusion.

• Full-year cash from operations was $215.7 million, up 26% year-over-year.

• Q4 net debt to adjusted EBITDA: 1x; year-end cash: $132.5 million; term loan balance: $400 million.

Outlook and guidance

• Fiscal 2025 net sales expected to grow 8.5%-10.5% reported, with adjusted EBITDA up 4%-6%.

• OWYN FY25 net sales projected at $135–145 million.

• Excluding the 53rd week and normalizing for OWYN, 2025 net sales and adjusted EBITDA growth expected in the 4%-6% range.

• Gross margin contraction of about 200 bps anticipated in 2025 due to input cost inflation, partially offset by productivity initiatives.

• CapEx for 2025 projected at $10-$15 million; interest expense/income projected at $25–27 million.