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B&G Foods, Inc. BGS posted first-quarter fiscal 2025 results, wherein both top and bottom lines missed the Zacks Consensus Estimate. Both net sales and earnings declined year over year.
B&G Foods faced a challenging start to the first quarter of fiscal 2025, impacted by retailer inventory reductions and the timing shift of Easter into the fiscal second quarter. However, the company has seen signs of improving sales trends in recent months. Management remains focused on stabilizing core sales, reshaping the portfolio for growth and margin expansion, accelerating cost savings and reducing leverage to enable future strategic acquisitions.
B&G Foods’ Quarterly Performance: Key Metrics and Insights
B&G Foods posted adjusted earnings of 4 cents per share, which missed the Zacks Consensus Estimate of 14 cents. Also, the bottom line slumped 77.8% from 18 cents reported in the prior-year quarter. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)
B&G Foods, Inc. Price, Consensus and EPS Surprise
B&G Foods, Inc. price-consensus-eps-surprise-chart | B&G Foods, Inc. Quote
Net sales declined 10.5% year over year to $425.4 million, missing the Zacks Consensus Estimate of $461 million. The decrease was caused by lower volumes, reduced net pricing and unfavorable product mix, as well as the negative impact of foreign currency exchange.
Base business net sales fell 10.5% to $425.4 million, primarily due to a volume decline of $42.4 million (8.9%), a $5.5 million (1.2%) reduction from net pricing and product mix, and a $2 million loss from unfavorable foreign currency effects.
The adjusted gross profit of $90.6 million decreased from $109.9 million in the year-ago period. The adjusted gross margin contracted 180 basis points (bps) to 21.3%.
SG&A expenses increased 1.1% to $49.1 million, due to $4.2 million in acquisition, divestiture-related, and other non-recurring costs, along with a $0.5 million rise in general and administrative expenses. These increases were partially offset by a $3.3 million decrease in consumer marketing expenses and a $0.9 million reduction in selling expenses. As a percentage of net sales, SG&A expenses increased 1.4 percentage points to 11.6%.
Adjusted EBITDA fell 21.2% to $59.1 million, largely reflecting lower net sales during the quarter and increased costs and investments in the Green Giant U.S. business. The adjusted EBITDA margin contracted 190 bps to 13.9%.
Decoding B&G Foods’ Segmental Performance
Specialty: Net sales were $134.4 million, down 13.1% year over year. The decline was due to lower net pricing and decreased volumes.
Meals: Net sales of $106.1 million dipped 11.6% year over year due to lower volumes and a decrease in net pricing and product mix.
Frozen & Vegetables: Net sales were $93.1 million, down 11.2% year over year. The downtick was due to lower net pricing and product mix, along with a decline in volume.
Spices & Flavor Solutions: Net sales were $91.7 million, down 4% year over year due to a decline in volumes.