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Jun 30, 2024
TreeHouse Q2 2024 Earnings Report
Second quarter performance improved with net sales trends and profit exceeding guidance, driven by progress in converting sales opportunities and supply chain execution.
Key Takeaways
TreeHouse Foods reported Q2 2024 results with net sales of $788.5 million and an adjusted EBITDA of $70.6 million, exceeding the company's guidance. The company reaffirmed its 2024 net sales and free cash flow outlook while narrowing its adjusted EBITDA range.
Net sales reached $788.5 million, surpassing the midpoint of the guidance range.
Adjusted EBITDA was $70.6 million, exceeding the company's guidance range.
The company repurchased approximately $45 million of its shares during the quarter.
Full year outlook reaffirmed for net sales of $3.43 to $3.50 billion and free cash flow of at least $130 million; adjusted EBITDA outlook narrowed to $360 to $380 million.
TreeHouse
TreeHouse
Forward Guidance
TreeHouse Foods updated its full year 2024 guidance. The company continues to expect net sales in the range of $3.43 to $3.50 billion, which represents approximately 0% to 2% year-over-year growth. The company is narrowing its expectations for Adjusted EBITDA to a range of $360 to $380 million and continues to expect free cash flow of at least $130 million.
Positive Outlook
- Net sales improvement due to new distribution wins that largely begin in the third quarter.
- Cost savings initiatives provide greatest impact beginning in third and fourth quarters.
- Our return to normalized service levels in our Broth business ahead of the upcoming peak season.
- Incremental pricing actions to recover recent commodity inflation related to cocoa.
- Third quarter net sales are expected in a range of $865 to $895 million, which represents approximately flat to 4% growth year-over-year.
Challenges Ahead
- The company is narrowing its expectations for Adjusted EBITDA to a range of $360 to $380 million. This reflects our first half performance and our assumption that some consumer-driven mix trends continue during the second half of the year.
- Net interest expense is continued to be expected in the range of $56 to $62 million.
- The Company continues to expect capital expenditures of approximately $145 million.
- Third quarter Adjusted EBITDA from continuing operations is expected in a range of $98 to $108 million, which reflects a timing shift as a result of favorable freight costs moving into the second quarter from the third quarter.
- Company incurred $19.3 million of non-cash impairment charges related to property, plant, and equipment.