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Sep 25, 2021
Central Garden & Pet Q4 2021 Earnings Report
Net sales increased, but earnings decreased due to rising costs and strategic investments.
Key Takeaways
Central Garden & Pet reported a net sales increase of 9% to $739 million, driven by acquisitions. However, the company experienced a net loss of $3.0 million, or $0.06 per share, compared to a net income of $14 million, or $0.25 per share, in the prior year quarter due to rising costs and strategic investments.
Net sales increased 9% to $739 million, driven by acquisitions.
Organic sales declined 1% due to unprecedented growth in the prior year quarter.
The company reported a net loss of $3.0 million, or $0.06 per share.
Operating margin decreased due to rising costs for key commodities, freight, and labor, as well as heightened strategic investment spending.
Central Garden & Pet
Central Garden & Pet
Forward Guidance
The Company currently projects fiscal 2022 GAAP EPS of $3.10 or better. The outlook includes the Company's anticipated investments in capacity expansion and automation at or slightly above fiscal 2021 levels, increased investments in brand building and eCommerce to drive sustainable growth, increasing costs for key commodities, freight and labor, muted consumer demand patterns following extraordinary demand spanning the last two fiscal years, as well as pricing actions across the Company's portfolio to help mitigate inflationary headwinds. The Company expects the impact of the headwinds to be more heavily front-half weighted.
Positive Outlook
- Anticipated investments in capacity expansion and automation at or slightly above fiscal 2021 levels
- Increased investments in brand building
- Increased investments in eCommerce to drive sustainable growth
- Pricing actions across the Company's portfolio to help mitigate inflationary headwinds
Challenges Ahead
- Increasing costs for key commodities
- Increasing costs for freight
- Increasing costs for labor
- Muted consumer demand patterns following extraordinary demand spanning the last two fiscal years
- The impact of the headwinds to be more heavily front-half weighted