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May 28, 2022
Simply Good Foods Q3 2022 Earnings Report
Simply Good Foods reported third quarter financial results, demonstrating solid marketplace performance driven by growth focus and effective execution in a challenging environment.
Key Takeaways
Simply Good Foods reported an 11.5% increase in net sales for the third quarter of fiscal year 2022. Net income significantly increased to $38.8 million, and adjusted diluted EPS rose to $0.44. The company reaffirmed its full-year outlook, expecting continued growth in net sales and adjusted EBITDA.
Net sales increased by 11.5% due to solid retail takeaway.
Net income was $38.8 million, a significant increase from $5.9 million.
Adjusted Diluted EPS increased to $0.44 from $0.43.
The company expects full year fiscal 2022 net sales to increase 14-15%.
Revenue by Geographic Location
Forward Guidance
The Company expects that it will generate solid net sales and Adjusted EBITDA growth in fiscal 2022. Due to the year-to-date higher than usual customer inventory levels, we expect fourth quarter fiscal 2022 net sales performance to be below the anticipated retail takeaway increase of high-single digits on a percentage basis versus last year.
Positive Outlook
- Net sales to increase about 14-15% versus last year.
- The Company reaffirms its gross margin outlook of about 250 basis points decline versus last year.
- Full-year fiscal 2022 Adjusted EBITDA to increase slightly less than the net sales growth rate.
- Marketing expense is anticipated to increase high single-digits on a percentage basis versus last year.
- Full-year fiscal 2022 Adjusted Diluted EPS to increase greater than the Adjusted EBITDA growth rate.
Challenges Ahead
- fourth quarter fiscal 2022 net sales performance to be below the anticipated retail takeaway increase of high-single digits on a percentage basis versus last year.
- Included in the sales outlook is about a 2 percentage point headwind due to the Europe business exit and the licensing of the Quest frozen pizza business.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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