St. Louis / MO. (pfh) Post Holdings Inc., a consumer packaged goods holding company, reported results for the fourth fiscal quarter and fiscal year ended September 30, 2020.Highlights:
- Fourth quarter net sales of USD 1.4 billion; operating profit of USD 178.9 million; net earnings of USD 57.0 million and Adjusted Ebitda of USD 274.8 million
- Fiscal year net sales of USD 5.7 billion; operating profit of USD 700.5 million; net earnings of USD 0.8 million and Adjusted Ebitda of USD 1,140.5 million
- Generated USD 625.6 million in cash from operations in fiscal year 2020
Basis of Presentation
On October 21, 2019, the initial public offering (the «IPO») of a minority interest in the BellRing Brands business, Post’s historical active nutrition business, was completed. Post fully consolidates the results of BellRing Brands Inc. («BellRing») and its subsidiaries within Post’s financial statements and effective October 21, 2019 allocates 28.8 percent of BellRing’s consolidated net earnings/loss and net assets to noncontrolling interest within Post’s financial statements. On July 1, 2020, Post completed the acquisition of Henningsen Foods Inc. («Henningsen»), the results of which are included in the Foodservice segment.
Fourth Quarter Consolidated Operating Results
Net sales were USD 1,411.3 million, a decrease of 2.2 percent, or USD 31.5 million, compared to the prior year period net sales of USD 1,442.8 million. Net sales growth in BellRing Brands, Weetabix and Refrigerated Retail was offset by declines in Foodservice and Post Consumer Brands. Gross profit was USD 440.3 million, or 31.2 percent of net sales, a decrease of USD 11.9 million compared to the prior year period gross profit of USD 452.2 million, or 31.3 percent of net sales.
Selling, general and administrative («SG+A») expenses were USD 229.8 million, or 16.3 percent of net sales, a decrease of USD 15.7 million compared to the prior year period SG+A expenses of USD 245.5 million, or 17.0 percent of net sales. Operating profit was USD 178.9 million, an increase of 74.4 percent, or USD 76.3 million, compared to the prior year period operating profit of USD 102.6 million. Operating profit in the fourth quarter of 2019 included non-cash goodwill and other intangible asset impairments of USD 63.3 million, which are discussed later in this release and were treated as adjustments for non-GAAP measures.
Net earnings were USD 57.0 million, an increase of 193.3 percent, or USD 118.1 million, compared to the prior year period net loss of USD 61.1 million. Net earnings/loss included income on swaps, net of USD 5.3 million in the fourth quarter of 2020 and expense on swaps, net of USD 105.7 million in the fourth quarter of 2019, which is discussed later in this release and was treated as an adjustment for non-GAAP measures. Net earnings/loss included equity method losses, net of tax of USD 8.3 million and USD 11.3 million in the fourth quarter of 2020 and 2019, respectively. Net earnings/loss excluded net earnings attributable to noncontrolling interest of USD 10.3 million and USD 0.4 million in the fourth quarter of 2020 and 2019, respectively. Diluted earnings per common share were USD 0.83, compared to a loss of USD 0.84 in the prior year period. Adjusted net earnings were USD 39.5 million, or USD 0.58 per diluted common share, compared to the prior year period Adjusted net earnings of USD 107.0 million, or USD 1.43 per diluted common share.
Adjusted Ebitda was USD 274.8 million, a decrease of 9.5 percent, or USD 28.8 million, compared to the prior year period Adjusted Ebitda of USD 303.6 million, with the decrease driven by Foodservice. Adjusted Ebitda in the fourth quarter of 2020 included an adjustment of USD 9.8 million primarily for the portion of BellRing’s consolidated net earnings which was allocated to noncontrolling interest, resulting in Adjusted Ebitda including 100 percent of the consolidated Adjusted Ebitda of BellRing.
Fiscal Year 2020 Consolidated Operating Results
Net sales were USD 5,698.7 million, an increase of 0.3 percent, or USD 17.6 million, compared to the prior year net sales of USD 5,681.1 million. Gross profit was USD 1,787.4 million, or 31.4 percent of net sales, a decrease of USD 4.7 million compared to the prior year gross profit of USD 1,792.1 million, or 31.5 percent of net sales.
SG+A expenses were USD 934.3 million, or 16.4 percent of net sales, an increase of USD 22.7 million compared to the prior year SG+A expenses of USD 911.6 million, or 16.0 percent of net sales. Operating profit was USD 700.5 million, a decrease of 10.3 percent, or USD 80.5 million, compared to the prior year operating profit of USD 781.0 million. Fiscal year 2019 operating profit included a USD 126.6 million gain related to the separate capitalization of 8th Avenue Food + Provisions Inc. («8th Avenue») and non-cash goodwill and other intangible asset impairments of USD 63.3 million, both of which were treated as adjustments for non-GAAP measures.
Net earnings were USD 0.8 million, a decrease of 99.4 percent, or USD 123.9 million, compared to the prior year net earnings of USD 124.7 million. Net earnings included loss on extinguishment of debt of USD 72.9 million and USD 6.1 million in fiscal years 2020 and 2019, respectively. Net earnings included expense on swaps, net of USD 187.1 million and USD 306.6 million in fiscal years 2020 and 2019, respectively. Loss on extinguishment of debt and expense on swaps, net are discussed later in this release and were treated as adjustments for non-GAAP measures. Net earnings included equity method losses, net of tax of USD 30.9 million and USD 37.0 million in fiscal years 2020 and 2019, respectively. Net earnings excluded net earnings attributable to noncontrolling interest of USD 28.2 million and USD 1.3 million in fiscal years 2020 and 2019, respectively. Diluted earnings per share were USD 0.01, compared to USD 1.66 in the prior year. Adjusted net earnings were USD 189.8 million, or USD 2.71 per diluted common share, compared to the prior year Adjusted net earnings of USD 378.0 million, or USD 5.03 per diluted common share.
Adjusted Ebitda was USD 1,140.5 million, a decrease of 5.8 percent, or USD 69.9 million, compared to the prior year Adjusted Ebitda of USD 1,210.4 million. Adjusted Ebitda for fiscal year 2020 included an adjustment of USD 26.4 million primarily for the portion of BellRing’s consolidated net earnings which was allocated to noncontrolling interest, resulting in Adjusted Ebitda including 100 percent of the consolidated Adjusted Ebitda of BellRing.
For additional information please read the company’s PDF file below (88 KB).
20201121-POST-HOLDINGS-Q4-2020.