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TreeHouse Foods, Inc. THS is likely to witness top and bottom-line declines when it reports first-quarter 2025 earnings on May 6, before market open. The Zacks Consensus Estimate for revenues is pegged at $789.6 million, indicating a 3.8% decrease from the prior-year quarter’s reported figure. (Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.)
The consensus mark for quarterly adjusted loss has been narrowed by 3 cents in the past seven days to 21 cents per share, which suggests a significant decline from the figure reported in the year-ago quarter. THS has a trailing four-quarter earnings surprise of 17.8%, on average. In the last reported quarter, the company lagged the Zacks Consensus Estimate by a margin of 2.1%.
TreeHouse Foods, Inc. Price, Consensus and EPS Surprise
TreeHouse Foods, Inc. price-consensus-eps-surprise-chart | TreeHouse Foods, Inc. Quote
Key Factors Influencing THS' Q1 Performance
TreeHouse Foods’ first-quarter performance is likely to have been negatively impacted due to ongoing operational disruptions and macroeconomic headwinds. On its last reported quarter’s earnings call, management highlighted that its frozen griddle product recall at the Brantford facility remains a key drag, as the facility resumed shipments but is likely to have contributed little to revenues in the quarter under review.
In addition, private label consumption trends are likely to have stayed weak amid broader consumer spending pressure. TreeHouse Foods’ strategic margin management actions, which included exiting low-margin and unprofitable contracts, are anticipated to have reduced volume intentionally, compounding the top line’s negative impacts.
On the earnings side, lower volumes are hurting operating leverage, making it harder for the company to absorb fixed costs, thereby compressing the gross margin. Added to this are one-time recall-related costs, including plant sanitation and restart costs, which are putting pressure on profitability.
For the first quarter, TreeHouse Foods has provided guidance, expecting adjusted net sales of at least $792 million. The company expects first-quarter adjusted EBITDA of at least $52 million, signaling gains from cost-saving and operational initiatives.
The company has been dedicated to implementing the TreeHouse Management Operating System, along with other supply-chain initiatives designed to improve execution, enhance margin performance and strengthen relationships with customers. The continuation of these trends is likely to have offered some respite in the to-be-reported quarter.
