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Simply Good Foods
🇺🇸 NASDAQ:SMPL
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Nov 30, 2019

Simply Good Foods Q1 2020 Earnings Report

Simply Good Foods reported financial results for the thirteen week period ended November 30, 2019.

Key Takeaways

Simply Good Foods reported a 25.8% increase in net sales to $152.2 million, driven by legacy Atkins and the acquisition of Quest. However, the company reported a net loss of $4.8 million, compared to net income of $15.3 million for the comparable period of 2019, primarily due to costs related to the Quest acquisition. The company updated its outlook for the full year fiscal 2020, anticipating net sales of $850-870 million and Adjusted EBITDA of $154-158 million.

Net sales increased 25.8% to $152.2 million.

Gross profit margin was 40.9%, a decrease of 200 basis points.

Net loss was $4.8 million, compared to net income of $15.3 million.

Adjusted EBITDA increased 19.1% to $31.8 million.

Total Revenue
$152M
Previous year: $121M
+25.8%
EPS
$0.22
Previous year: $0.18
+22.2%
Adjusted EBITDA
$31.8M
Gross Profit
$62.2M
Previous year: $51.9M
+19.8%
Cash and Equivalents
$72.7M
Previous year: $211M
-65.5%
Free Cash Flow
-$8.21M
Previous year: $12.5M
-165.9%
Total Assets
$2.02B
Previous year: $1.09B
+85.8%

Simply Good Foods

Simply Good Foods

Simply Good Foods Revenue by Segment

Forward Guidance

For the full year fiscal 2020, the Company updated its outlook for the acquisition of Quest and anticipates full-year net sales of $850-870 million and Adjusted EBITDA of $154-158 million. The Company anticipates 2020 Adjusted Diluted Earnings Per Share to be in the range of $0.90 to $0.95.

Positive Outlook

  • Full-year net sales of $850-870 million.
  • Adjusted EBITDA of $154-158 million.
  • Legacy Atkins net sales growth for the fifty-two weeks ended August 29, 2020, to be at the high end of its long-term net sales growth target of 4% to 6%.
  • Legacy Atkins Adjusted EBITDA is expected to grow at a somewhat higher rate than its expectation for net sales.
  • Adjusted Diluted Earnings Per Share to be in the range of $0.90 to $0.95 (an increase of 17% to 23% versus Adjusted Diluted Earnings Per Share of $0.77 in 2019).

Challenges Ahead

  • The extra week included in fiscal year 2019 is a headwind to year-over-year comparisons of reported legacy Atkins net sales growth in fiscal 2020 of about 2%.
  • Integration of Quest
  • Changes in consumer preferences and purchasing habits
  • The Company’s ability to maintain adequate product inventory levels to timely supply customer orders
  • Competitive product and pricing activity

Revenue & Expenses

Visualization of income flow from segment revenue to net income

Company Overview

Full financial data and analysis

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