The Simply Good Foods Company Reports Third Quarter 2018 Financial Results
Denver, CO, July 10, 2018 - The Simply Good Foods Company (NASDAQ: SMPL, SMPL.W) (“Simply Good Foods,” or the “Company”), a developer, marketer and seller of branded nutritional foods and snacking products, today reported financial results for the thirteen week and thirty-nine week periods ended May 26, 2018.
“Our strong third quarter financial and marketplace results continue to reflect the effectiveness of the strategic initiatives we outlined earlier this year that focus on marketing investments targeting our broader lifestyle consumers, refreshed packaging, cleaner labels and new products,” said Joseph E. Scalzo, President and Chief Executive Officer of The Simply Good Foods Company. “Organic sales growth of 11.1% this quarter was driven by volume and more efficient trade spend, resulting in solid gross margin and adjusted EBITDA(1) expansion. Retail takeaway performance accelerated in the quarter and increased 9.8% and 6.9% for the thirteen and thirty-nine weeks ended May 26, 2018. Through the third quarter, we have grown year-to-date net sales 8.2% and are well positioned to deliver solid financial results in fiscal 2018.”
Results for the Successor Period for the Thirteen Weeks Ended May 26, 2018, and Predecessor Period for the Thirteen Weeks Ended May 27, 2017(1)
Successor net sales were $107.2 million and Predecessor net sales were $96.5 million
Successor income tax expense was $2.8 million and Predecessor income tax expense was $1.8 million
Successor net income was $7.1 million and Predecessor net income was $4.3 million
In order to present comparable financial information, the Company has also presented supplemental unaudited pro forma financial information for the thirteen weeks and thirty-nine weeks ended May 27, 2017, which give effect to the business combination (the “Business Combination”) with Conyers Park Acquisition Corp. (“Conyers Park”) and NCP-ATK Holdings, Inc. (“Atkins”) as if it had occurred on August 28, 2016. All references in this press release section to results for the thirteen week and thirty-nine week third quarter ended May 27, 2017, refer to such unaudited pro forma results. The Company believes this pro forma information provides helpful supplemental information with respect to the performance of Simply Good Foods, and particularly the Atkins business, during this period.
Third Quarter 2018 Financial Highlights vs. Third Quarter 2017 Pro Forma
Net sales increased 11.1%, or $10.7 million, to $107.2 million
Gross profit margin of 47.8%, an increase of 270 basis points
Net income increased $1.7 million to $7.1 million
Earnings per diluted share (“EPS”) of $0.10, an increase of $0.03 per fully diluted share
Adjusted EBITDA(2) increased 21.4%, to $17.9 million.
(All comparisons above are with respect to the Predecessor's pro forma thirteen week third quarter ended May 27, 2017)
(1) On July 7, 2017, the Company completed the Business Combination between Atkins and Conyers Park. As a result of the Business Combination, both Conyers Park and Atkins became wholly-owned subsidiaries of Simply Good Foods. Pursuant to GAAP and SEC requirements, and the application of acquisition accounting, the Company's consolidated financial results are presented: (i) as of and for the thirteen weeks and thirty-nine weeks ended May 26, 2018 (Successor); and (ii) as of and for the thirteen weeks and thirty-nine weeks ended May 27, 2017 (Predecessor). All references to “Successor” refers to Simply Good Foods, and all references to “Predecessor” refers to Atkins prior to the Business Combination.
(2) Adjusted EBITDA is a non-GAAP financial measure. Please refer to “Reconciliation of Adjusted EBITDA” in this press release for an explanation and reconciliations of this non-GAAP financial measure.
The following information was filed by Simply Good Foods Co (SMPL) on Tuesday, July 10, 2018 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.