Post Holdings, Inc. POST reported first-quarter fiscal 2025 results, wherein the top and bottom lines increased year over year. Earnings surpassed the Zacks Consensus Estimate while sales missed the same.
Post Holdings’ Q1 Metrics in Detail
The company posted adjusted earnings of $1.73 per share, surpassing the Zacks Consensus Estimate of $1.49. The bottom line improved from the adjusted earnings of $1.69 per share recorded in the year-ago quarter.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
Net sales reached $1,974.7 million, marking a 0.4% increase, which includes $60.8 million from acquisitions. When excluding the acquisition impact, the growth in Foodservice was counterbalanced by declines in Post Consumer Brands, Refrigerated Retail and Weetabix. The top line missed the Zacks Consensus Estimate of $1,975 million.
The gross profit of $595.3 million rose 4% year over year, while the gross margin expanded to 30.1% from 29.1% reported in the year-ago quarter.
Selling, general and administrative (SG&A) expenses increased 2.7% to $331.6 million. As a percentage of net sales, the metric came in at 16.8% compared with 16.4% reported in the year-ago period.
The operating profit registered a robust increase of 2.3% to $214.1 million. The adjusted EBITDA was $369.9 million, an increase of 2.9% from $359.5 million in the year-ago quarter.
Post Holdings, Inc. Price, Consensus and EPS Surprise
Post Holdings, Inc. Price, Consensus and EPS Surprise
Post Holdings, Inc. price-consensus-eps-surprise-chart | Post Holdings, Inc. Quote
Decoding Post Holdings’ Segmental Performance
Post Consumer Brands: The segment reported net sales of $963.9 million, down 2.5% year over year, including $54.4 million in sales from Perfection Pet Foods. Excluding the gains from Perfection, volumes fell 8.8%. Pet food volumes fell 13% while Cereal volumes declined 2.3%. The segment’s profit dropped 1.3% to $131 million, with adjusted EBITDA rising 7.9% to $204.8 million.
Weetabix: The segment registered a 1.2% decline in net sales to $127.6 million, including a $6.4 million contribution from the Deeside acquisition and a positive currency impact of nearly 300 basis points. Excluding the impact of Deeside, volumes declined by 11.6%, primarily due to reduced promotional activity, the strategic discontinuation of underperforming products, and a decline in the cereal category. The segment's profit declined 24.3% to $15.9 million, with adjusted EBITDA dropping 8.5% to $28 million.
Foodservice: The segment recorded 8.7% growth in net sales to $616.6 million. Volumes grew by 2.8%, driven mainly by distribution gains in eggs and potatoes, along with the addition of ready-to-drink shakes in the current period. The segment’s profit increased 13.7% to $86.1 million, with adjusted EBITDA rising 10.4% to $116.8 million.
Refrigerated Retail: The segment sales dipped 5.1% year over year, amounting to $266.6 million. Volumes dropped by 4.4%, with growth in sausage mitigated by declines in side dishes, cheese and eggs. The segmental profit fell 32% to $24.2 million, while adjusted EBITDA dropped 22.4% to $41.6 million.
Other Financial Aspects of POST
Post Holdings ended the quarter with cash and cash equivalents of $872.9 million, long-term debt of $6,944.4 million and total shareholders’ equity of $3,898.1 million.
In the first quarter of fiscal 2025, Post Holdings repurchased 1.6 million shares of its common stock for $181.1 million. From the end of the first quarter through Feb. 6, 2025, an additional 1 million shares were repurchased for $106.9 million. On Feb. 4, the company approved a new $500 million share repurchase program, which will start on Feb. 10. As of Feb. 6, Post Holdings had $200.2 million remaining under its current $500 million repurchase program.
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What to Expect From POST in FY25?
Post Holdings has updated its guidance for the fiscal year 2025 Adjusted EBITDA, now projecting a range of $1,420-$1,460 million, up from the previous range of $1,410-$1,460 million.
In addition, the company expects fiscal year 2025 capital expenditures to be between $380 and $420 million. This includes investments from Post Consumer Brands in network optimization and pet food safety and capacity, totaling $90-$100 million. The company also plans to allocate $80-$90 million toward Foodservice investments, including the completion of the Norwalk, IA, precooked egg facility expansion and the continued expansion of cage-free egg facilities.
This Zacks Rank #3 (Hold) company’s shares have dropped 4.3% compared with the industry’s decline of 9.9% in the past six months.
Top-Ranked Stocks
We have highlighted some top-ranked stocks from the broader Consumer Staples space, namely United Natural Foods UNFI, Ollie's Bargain Outlet OLLI and TreeHouse Foods THS.
United Natural Foods, a key distributor of natural, organic and specialty food and non-food products, presently flaunts a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus estimate for United Natural Foods’ current financial-year sales and EPS indicates growth of 0.3% and 442.9%, respectively, from the prior-year levels. UNFI has a trailing four-quarter average earnings surprise of 553.1%.
Ollie's is a value retailer of brand-name merchandise at drastically reduced prices. The company currently carries a Zacks Rank #2 (Buy). OLLI has a trailing four-quarter earnings surprise of 5%, on average.
The Zacks Consensus Estimate for Ollie's current financial year’s sales and EPS suggests growth of 8.3% and 13.1%, respectively, from the year-ago reported numbers. The consensus mark for OLLI’s EPS has been unchanged in the past 30 days.
TreeHouse Foods, a private brand snacks and beverages company, presently has a Zacks Rank #2. THS delivered a trailing four-quarter earnings surprise of 20.4%, on average.
The Zacks Consensus Estimate for TreeHouse Foods’ current financial year’s sales and EPS suggests a decline of 4.3% and 20.7%, respectively, from the year-ago reported numbers.
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