Freshpet, Inc. Reports Third Quarter 2024 Financial Results
Freshpet reported strong Q3 2024 financial results with net sales increasing 26.3% to $253.4 million, marking the 25th consecutive quarter of >25% year-on-year growth. The company achieved net income of $11.9 million, compared to a $7.2 million loss in the prior year. Gross margin improved to 40.4% from 33.0%, while Adjusted EBITDA reached $43.5 million, up from $23.2 million. Based on strong performance, Freshpet raised its 2024 guidance, projecting net sales of ~$975 million and Adjusted EBITDA of at least $155 million.
Freshpet ha riportato risultati finanziari impressionanti per il terzo trimestre del 2024, con un incremento del fatturato netto del 26,3% a 253,4 milioni di dollari, segnando il 25° trimestre consecutivo di crescita superiore al 25% su base annua. L'azienda ha ottenuto un utile netto di 11,9 milioni di dollari, rispetto a una perdita di 7,2 milioni di dollari nell'anno precedente. Il margine lordo è migliorato al 40,4% rispetto al 33,0%, mentre l'EBITDA rettificato ha raggiunto i 43,5 milioni di dollari, rispetto ai 23,2 milioni di dollari dell'anno scorso. Sulla base delle prestazioni solide, Freshpet ha rivisto al rialzo le previsioni per il 2024, prevedendo un fatturato netto di circa 975 milioni di dollari e un EBITDA rettificato di almeno 155 milioni di dollari.
Freshpet informó sobre resultados financieros sólidos para el tercer trimestre de 2024, con un aumento del ingreso neto del 26.3% hasta 253.4 millones de dólares, marcando el 25º trimestre consecutivo de crecimiento interanual superior al 25%. La compañía logró un ingreso neto de 11.9 millones de dólares, en comparación con una pérdida de 7.2 millones de dólares en el año anterior. El margen bruto mejoró al 40.4% desde el 33.0%, mientras que el EBITDA ajustado alcanzó los 43.5 millones de dólares, frente a los 23.2 millones del año pasado. Basado en un rendimiento sólido, Freshpet elevó su guía para 2024, proyectando ingresos netos de aproximadamente 975 millones de dólares y un EBITDA ajustado de al menos 155 millones de dólares.
프레시펫(Freshpet)은 2024년 3분기 강력한 재무 결과를 보고하며, 순매출이 26.3% 증가하여 2억 5,340만 달러에 이르렀고, 이는 25분기 연속 25% 이상의 연간 성장이라는 기록을 세웠습니다. 회사는 순이익 1,190만 달러를 달성했으며, 이는 전년 대비 720만 달러의 손실과 비교됩니다. 총 마진은 33.0%에서 40.4%로 개선되었고, 조정된 EBITDA는 2,320만 달러에서 4,350만 달러로 증가했습니다. 강력한 성과를 바탕으로 프레시펫은 2024년 전망을 상향 조정하며, 약 9억 7,500만 달러의 순매출과 최소 1억 5,500만 달러의 조정된 EBITDA를 예측했습니다.
Freshpet a annoncé des résultats financiers solides pour le troisième trimestre 2024, avec une augmentation des ventes nettes de 26,3 % à 253,4 millions de dollars, marquant ainsi le 25e trimestre consécutif de croissance annuelle supérieure à 25 %. L'entreprise a réalisé un revenu net de 11,9 millions de dollars, contre une perte de 7,2 millions de dollars l'année précédente. La marge brute s'est améliorée à 40,4 % contre 33,0 %, tandis que l'EBITDA ajusté a atteint 43,5 millions de dollars, contre 23,2 millions de dollars. Sur la base de cette performance solide, Freshpet a relevé ses prévisions pour 2024, projetant des ventes nettes d'environ 975 millions de dollars et un EBITDA ajusté d'au moins 155 millions de dollars.
Freshpet berichtete über starke Finanzzahlen für das dritte Quartal 2024, wobei der Netto-Umsatz um 26,3% auf 253,4 Millionen US-Dollar anstieg und damit das 25. aufeinanderfolgende Quartal mit über 25% Wachstum im Jahresvergleich markiert wurde. Das Unternehmen erzielte einen Reingewinn von 11,9 Millionen US-Dollar, verglichen mit einem Verlust von 7,2 Millionen US-Dollar im Vorjahr. Die Bruttomarge verbesserte sich auf 40,4% von 33,0%, während das bereinigte EBITDA auf 43,5 Millionen US-Dollar anstieg, von 23,2 Millionen US-Dollar. Aufgrund der starken Leistung hat Freshpet seine Prognose für 2024 angehoben und rechnet mit einem Netto-Umsatz von rund 975 Millionen US-Dollar und einem bereinigten EBITDA von mindestens 155 Millionen US-Dollar.
- Net sales increased 26.3% to $253.4 million in Q3 2024
- Turned $7.2M loss into $11.9M profit year-over-year
- Gross margin improved significantly from 33.0% to 40.4%
- Adjusted EBITDA nearly doubled to $43.5M from $23.2M
- Operating cash flow increased to $103.9M from $39.0M
- Raised full-year guidance for both sales and EBITDA
- SG&A expenses increased to $90.3M from $73.4M
- Total debt of $394.6M outstanding
Insights
Freshpet delivered exceptional Q3 2024 results with remarkable financial metrics across the board. Net sales surged
The company's operational efficiency is evident in their strong cash position of
The pet food industry's premium segment continues to show resilience, with Freshpet's volume-driven growth of
The reduction in logistics costs as a percentage of sales suggests supply chain optimization, though increased media spending indicates ongoing investment in brand building. The company's ability to raise prices while maintaining volume growth reflects strong brand equity and consumer loyalty in the premium pet food segment.
25th Consecutive Quarter of >
Strong Operating Performance Drove Significant Margin Expansion & Cash Generation
Company Raises 2024 Net Sales and Adjusted EBITDA Guidance
BEDMINSTER, N.J., Nov. 04, 2024 (GLOBE NEWSWIRE) -- Freshpet, Inc. (“Freshpet” or the “Company”) (Nasdaq: FRPT) today reported financial results for its third quarter ended September 30, 2024.
Third Quarter 2024 Financial Highlights Compared to Prior Year Period
- Net sales of
$253.4 million , an increase of26.3% . - Net income of
$11.9 million , compared to the prior year period net loss of$7.2 million . - Gross margin of
40.4% , compared to the prior year period of33.0% . - Adjusted Gross Margin of
46.5% , compared to the prior year period of40.2% .1 - Adjusted EBITDA of
$43.5 million , compared to the prior year period of$23.2 million .1 - For the first nine months of 2024, net cash provided by operating activities of
$103.9 million , compared to the prior year period of$39.0 million .
"Our third quarter results demonstrate the strength and consistency of both net sales and profitability growth we have been striving to deliver. We delivered our 25th consecutive quarter of >
Third Quarter 2024
Net sales increased
Gross profit was
Selling, general and administrative expenses (“SG&A”) were
Net income was
1 Adjusted Gross Margin, Adjusted Gross Profit, Adjusted SG&A and Adjusted EBITDA are non-GAAP financial measures. See "Non-GAAP Measures" for how the Company defines these measures and the financial tables that accompany this release for reconciliations of these measures to the closest comparable GAAP measures.
Adjusted EBITDA was
First Nine Months of 2024
Net sales increased
Gross profit was
Selling, general and administrative expenses (“SG&A”) were
Net income was
Adjusted EBITDA was
Balance Sheet
As of September 30, 2024, the Company had cash and cash equivalents of
The Company will utilize its balance sheet to support its ongoing capital needs in connection with its long-term capacity plan.
Outlook
For full year 2024, the Company is updating its guidance and now expects the following:
- Net sales of ~
$975 million , an increase of ~27% from 2023, compared to at least$965 million in the previous guidance; - Adjusted EBITDA of at least
$155 million , compared to at least$140 million in the previous guidance; and - Capital expenditures of ~
$180 million , compared to ~$200 million in the previous guidance.
The Company does not provide guidance for net income (loss), the U.S. GAAP measure most directly comparable to Adjusted EBITDA, and similarly cannot provide a reconciliation between its forecasted Adjusted EBITDA and net income (loss) metrics without unreasonable effort due to the unavailability of reliable estimates for certain components of net income (loss) and the respective reconciliations, including the timing of and amount of costs of goods sold and selling, general and administrative expenses. These items are not within the Company's control and may vary greatly between periods and could significantly impact future results.
Conference Call & Earnings Presentation Webcast Information
As previously announced, today, November 4, 2024, the Company will host a conference call beginning at 8:00 a.m. Eastern Time with members of its leadership team. The conference call webcast will be available live over the Internet through the "Investors" section of the Company's website at www.freshpet.com. To participate on the live call, listeners in North America may dial (877) 407-0792 and international listeners may dial (201) 689-8263.
A replay of the conference call will be archived on the Company's website and telephonic playback will be available from 12:00 p.m. Eastern Time today through November 18, 2024. North American listeners may dial (844) 512-2921 and international listeners may dial (412) 317-6671; the passcode is 13749124.
About Freshpet
Freshpet’s mission is to improve the lives of dogs and cats through the power of fresh, real food. Freshpet foods are blends of fresh meats, vegetables and fruits farmed locally and made at our Freshpet Kitchens. We thoughtfully prepare our foods using natural ingredients, cooking them in small batches at lower temperatures to preserve the natural goodness of the ingredients. Freshpet foods and treats are kept refrigerated from the moment they are made until they arrive at Freshpet Fridges in your local market.
Our foods are available in select grocery, mass, digital, pet specialty, and club retailers across the United States, Canada and Europe. From the care we take to source our ingredients and make our food, to the moment it reaches your home, our integrity, transparency and social responsibility are the way we like to run our business. To learn more, visit www.freshpet.com.
Connect with Freshpet:
https://www.facebook.com/Freshpet
https://x.com/Freshpet
http://instagram.com/Freshpet
http://pinterest.com/Freshpet
https://www.tiktok.com/@Freshpet
https://www.youtube.com/user/freshpet400
Forward Looking Statements
Certain statements in this release constitute “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to our ability to achieve our 2027 targets, create meaningful shareholder value, and guidance with respect to 2024 net sales, Adjusted EBITDA and capital expenditures. These statements are based on management's current opinions, expectations, beliefs, plans, objectives, assumptions or projections regarding future events or future results. While Freshpet believes that its assumptions are reasonable, it is very difficult to predict the impact of known factors, and, of course, it is impossible to anticipate all factors that could affect actual results. There are several risks and uncertainties which could cause actual results, performance, and achievements to differ materially from those stated or implied by the forward-looking statements described herein, including, most prominently, the risks discussed under the heading “Risk Factors” in the Company's latest annual report on Form 10-K and its quarterly reports on Form 10-Q filed with the Securities and Exchange Commission. Such forward-looking statements are made only as of the date of this release. Freshpet undertakes no obligation to publicly update or revise any forward-looking statement because of new information, future events or otherwise, except as otherwise required by law. If we do update one or more forward-looking statements, no inference should be made that we will make additional updates with respect to those or other forward-looking statements.
Non-GAAP Financial Measures
Freshpet uses the following non-GAAP financial measures in its financial communications. These non-GAAP financial measures should be considered as supplements to the U.S. GAAP reported measures, should not be considered replacements for, or superior to, the U.S. GAAP measures and may not be comparable to similarly named measures used by other companies.
- Adjusted Gross Profit
- Adjusted Gross Profit as a percentage of net sales (Adjusted Gross Margin)
- Adjusted SG&A Expenses
- Adjusted SG&A Expenses as a percentage of net sales
- EBITDA
- Adjusted EBITDA
- Adjusted EBITDA as a percentage of net sales
Adjusted Gross Profit: Freshpet defines Adjusted Gross Profit as gross profit before depreciation expense, non-cash share-based compensation and loss on disposal of manufacturing equipment.
Adjusted SG&A Expenses: Freshpet defines Adjusted SG&A as SG&A expenses before depreciation and amortization expense, non-cash share-based compensation, implementation and other costs associated with the implementation of an enterprise resource planning ("ERP") system, fees related to the capped call transactions, loss on disposal of equipment, and advisory fees related to shareholder activism defense engagement.
EBITDA and Adjusted EBITDA: EBITDA represents net income (loss) plus interest expense net of interest income, income tax expense and depreciation and amortization expense, and Adjusted EBITDA represents EBITDA plus loss on equity method investment, gain on equity investment, non-cash share-based compensation expense, implementation and other costs associated with the implementation of an ERP system, loss on disposal of property, plant and equipment, fees related to the capped call transactions, and advisory fees related to shareholder activism defense engagement.
Management believes that the non-GAAP financial measures are meaningful to investors because they provide a view of the Company with respect to ongoing operating results. The non-GAAP financial measures are shown as supplemental disclosures in this release because they are widely used by the investment community for analysis and comparative evaluation. They also provide additional metrics to evaluate the Company’s operations and, when considered with both the Company’s GAAP results and the reconciliation to the most comparable U.S. GAAP measures, provide a more complete understanding of the Company’s business than could be obtained absent this disclosure. The non-GAAP measures are not and should not be considered an alternative to the most comparable U.S. GAAP measures or any other figure calculated in accordance with U.S. GAAP, or as an indicator of operating performance. The Company’s calculation of the non-GAAP financial measures may differ from methods used by other companies. Management believes that the non-GAAP measures are important to an understanding of the Company's overall operating results in the periods presented. The non-GAAP financial measures are not recognized in accordance with U.S. GAAP and should not be viewed as an alternative to U.S. GAAP measures of performance.
Investor Contact:
Rachel Ulsh
Rulsh@freshpet.com
Media Contact:
Press@freshpet.com
| FRESHPET, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited, in thousands, except per share data) | |||||||
| September 30, 2024 | December 31, 2023 | ||||||
| ASSETS | |||||||
| CURRENT ASSETS: | |||||||
| Cash and cash equivalents | $ | 274,594 | $ | 296,871 | |||
| Accounts receivable, net of allowance for doubtful accounts | 65,015 | 56,754 | |||||
| Inventories, net | 72,791 | 63,238 | |||||
| Prepaid expenses | 5,768 | 7,615 | |||||
| Other current assets | 3,126 | 2,841 | |||||
| Total Current Assets | 421,294 | 427,319 | |||||
| Property, plant and equipment, net | 1,039,980 | 979,164 | |||||
| Deposits on equipment | 1,118 | 1,895 | |||||
| Operating lease right of use assets | 3,671 | 3,616 | |||||
| Long term investment in equity securities | 33,446 | 23,528 | |||||
| Other assets | 32,189 | 28,899 | |||||
| Total Assets | $ | 1,531,698 | $ | 1,464,421 | |||
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
| CURRENT LIABILITIES: | |||||||
| Accounts payable | $ | 35,481 | $ | 36,096 | |||
| Accrued expenses | 50,396 | 49,816 | |||||
| Current operating lease liabilities | 1,290 | 1,312 | |||||
| Current finance lease liabilities | 2,075 | 1,998 | |||||
| Total Current Liabilities | $ | 89,242 | $ | 89,222 | |||
| Convertible senior notes | 394,633 | 393,074 | |||||
| Long term operating lease liabilities | 2,556 | 2,591 | |||||
| Long term finance lease liabilities | 23,820 | 26,080 | |||||
| Total Liabilities | $ | 510,251 | $ | 510,967 | |||
| Commitments and contingencies | — | — | |||||
| STOCKHOLDERS' EQUITY: | |||||||
| Common stock — voting, | 48 | 48 | |||||
| Additional paid-in capital | 1,321,767 | 1,282,984 | |||||
| Accumulated deficit | (299,928 | ) | (328,731 | ) | |||
| Accumulated other comprehensive loss | (184 | ) | (591 | ) | |||
| Treasury stock, at cost — 14 shares on September 30, 2024 and on December 31, 2023 | (256 | ) | (256 | ) | |||
| Total Stockholders' Equity | 1,021,447 | 953,454 | |||||
| Total Liabilities and Stockholders' Equity | $ | 1,531,698 | $ | 1,464,421 | |||
| FRESHPET, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Unaudited, in thousands, except per share data) | |||||||||||||||
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| NET SALES | $ | 253,367 | $ | 200,621 | $ | 712,469 | $ | 551,474 | |||||||
| COST OF GOODS SOLD | 151,120 | 134,328 | 428,112 | 375,177 | |||||||||||
| GROSS PROFIT | 102,247 | 66,293 | 284,357 | 176,297 | |||||||||||
| SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES | 90,338 | 73,371 | 265,734 | 221,638 | |||||||||||
| INCOME (LOSS) FROM OPERATIONS | 11,909 | (7,078 | ) | 18,623 | (45,341 | ) | |||||||||
| OTHER INCOME (EXPENSES): | |||||||||||||||
| Interest and Other Income, net | 2,963 | 4,130 | 9,158 | 9,185 | |||||||||||
| Interest Expense | (2,923 | ) | (4,148 | ) | (8,734 | ) | (10,648 | ) | |||||||
| Gain on Equity Investment | — | — | 9,918 | — | |||||||||||
| 40 | (18 | ) | 10,342 | (1,463 | ) | ||||||||||
| INCOME (LOSS) BEFORE INCOME TAXES | 11,949 | (7,096 | ) | 28,965 | (46,804 | ) | |||||||||
| INCOME TAX EXPENSE | 54 | 70 | 162 | 210 | |||||||||||
| LOSS ON EQUITY METHOD INVESTMENT | — | — | — | 1,890 | |||||||||||
| INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS | $ | 11,895 | $ | (7,166 | ) | $ | 28,803 | $ | (48,904 | ) | |||||
| OTHER COMPREHENSIVE INCOME (LOSS): | |||||||||||||||
| Change in foreign currency translation | $ | 604 | $ | (296 | ) | $ | 407 | $ | (2,329 | ) | |||||
| TOTAL OTHER COMPREHENSIVE INCOME (LOSS) | 604 | (296 | ) | 407 | (2,329 | ) | |||||||||
| TOTAL COMPREHENSIVE INCOME (LOSS) | $ | 12,499 | $ | (7,462 | ) | $ | 29,210 | $ | (51,233 | ) | |||||
| NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS | |||||||||||||||
| -BASIC | $ | 0.25 | $ | (0.15 | ) | $ | 0.59 | $ | (1.02 | ) | |||||
| -DILUTED | $ | 0.24 | $ | (0.15 | ) | $ | 0.57 | $ | (1.02 | ) | |||||
| WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING | |||||||||||||||
| -BASIC | 48,509 | 48,194 | 48,436 | 48,123 | |||||||||||
| -DILUTED | 50,282 | 48,194 | 50,203 | 48,123 | |||||||||||
| FRESHPET, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited, in thousands) | |||||||
| For the Nine Months Ended September 30, | |||||||
| 2024 | 2023 | ||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
| Net income (loss) | $ | 28,803 | $ | (48,904 | ) | ||
| Adjustments to reconcile net income (loss) to net cash flows provided by operating activities: | |||||||
| Provision for loss on accounts receivable | 15 | 9 | |||||
| Loss on disposal of property, plant and equipment | 1,054 | 688 | |||||
| Share-based compensation | 37,862 | 24,952 | |||||
| Inventory obsolescence | 732 | — | |||||
| Depreciation and amortization | 52,249 | 45,436 | |||||
| Write-off and amortization of deferred financing costs and loan | 1,559 | 3,548 | |||||
| Change in operating lease right of use asset | 1,045 | 1,175 | |||||
| Loss on equity method investment | — | 1,890 | |||||
| Gain on equity investment | (9,918 | ) | — | ||||
| Changes in operating assets and liabilities: | |||||||
| Accounts receivable | (8,294 | ) | 3,148 | ||||
| Inventories | (8,852 | ) | (773 | ) | |||
| Prepaid expenses and other current assets | (803 | ) | (696 | ) | |||
| Other assets | (1,540 | ) | (3,495 | ) | |||
| Accounts payable | 8,839 | 2,300 | |||||
| Accrued expenses | 2,355 | 11,109 | |||||
| Operating lease liability | (1,187 | ) | (1,419 | ) | |||
| Net cash flows provided by operating activities | 103,919 | 38,968 | |||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
| Purchase of short-term investments | — | (113,441 | ) | ||||
| Proceeds from maturities of short-term investments | — | 113,441 | |||||
| Acquisitions of property, plant and equipment, software and deposits on equipment | (128,828 | ) | (161,642 | ) | |||
| Net cash flows used in investing activities | (128,828 | ) | (161,642 | ) | |||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||
| Proceeds from exercise of options to purchase common stock | 5,516 | 4,172 | |||||
| Tax withholdings related to net shares settlements of restricted stock | (1,440 | ) | (859 | ) | |||
| Purchase of capped call options | — | (66,211 | ) | ||||
| Proceeds from issuance of convertible senior notes | — | 393,518 | |||||
| Debt issuance costs | — | (2,026 | ) | ||||
| Principal payments under finance lease obligations | (1,444 | ) | (548 | ) | |||
| Net cash flows provided by financing activities | 2,632 | 328,046 | |||||
| NET CHANGE IN CASH AND CASH EQUIVALENTS | (22,277 | ) | 205,372 | ||||
| CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR | 296,871 | 132,735 | |||||
| CASH AND CASH EQUIVALENTS, END OF PERIOD | $ | 274,594 | $ | 338,107 | |||
| FRESHPET, INC. AND SUBSIDIARIES RECONCILIATION BETWEEN GROSS PROFIT AND ADJUSTED GROSS PROFIT | |||||||||||||||
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| (Dollars in thousands) | |||||||||||||||
| Gross profit | $ | 102,247 | $ | 66,293 | $ | 284,357 | $ | 176,297 | |||||||
| Depreciation expense | 13,197 | 11,767 | 35,698 | 33,106 | |||||||||||
| Non-cash share-based compensation | 1,610 | 2,579 | 6,451 | 8,696 | |||||||||||
| Loss on disposal of manufacturing equipment | 639 | — | 692 | — | |||||||||||
| Adjusted Gross Profit | $ | 117,693 | $ | 80,639 | $ | 327,198 | $ | 218,099 | |||||||
| Adjusted Gross Profit as a % of Net Sales | 46.5 | % | 40.2 | % | 45.9 | % | 39.5 | % | |||||||
| FRESHPET, INC. AND SUBSIDIARIES RECONCILIATION BETWEEN SG&A EXPENSES AND ADJUSTED SG&A EXPENSES | |||||||||||||||
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| (Dollars in thousands) | |||||||||||||||
| SG&A expenses | $ | 90,338 | $ | 73,371 | $ | 265,734 | $ | 221,638 | |||||||
| Depreciation and amortization expense | 5,512 | 4,452 | 15,967 | 12,043 | |||||||||||
| Non-cash share-based compensation (a) | 10,498 | 5,511 | 31,411 | 16,256 | |||||||||||
| Loss on disposal of equipment | 129 | 226 | 362 | 688 | |||||||||||
| Enterprise Resource Planning (b) | — | 212 | — | 1,550 | |||||||||||
| Capped Call Transactions fees (c) | — | — | — | 113 | |||||||||||
| Shareholder activism defense engagement (d) | — | 5,548 | — | 8,177 | |||||||||||
| Organization changes (e) | — | — | — | (67 | ) | ||||||||||
| Adjusted SG&A Expenses | $ | 74,199 | $ | 57,422 | $ | 217,994 | $ | 182,878 | |||||||
| Adjusted SG&A Expenses as a % of Net Sales | 29.3 | % | 28.6 | % | 30.6 | % | 33.2 | % | |||||||
| (a) | Includes true-ups to share-based compensation expense compared to prior periods. We have certain outstanding share-based awards with performance-based vesting conditions that require the achievement of certain Adjusted EBITDA and/or Net Sales targets as a condition of vesting. At each reporting period, we reassess the probability of achieving the performance criteria and the performance period required to meet those targets. When the probability of achieving such performance conditions changes, the compensation cost previously recorded is adjusted as needed. When such performance conditions are deemed to be improbable of achievement, the compensation cost previously recorded is reversed. |
| (b) | Represents costs associated with the implementation of an ERP system. |
| (c) | Represents fees associated with the Capped Call Transactions. |
| (d) | Represents advisory fees related to shareholder activism defense engagement. |
| (e) | Represents a true-up to transition costs related to the organization changes designed to support growth, including several changes in organizational structure designed to enhance capabilities and support long-term growth objectives. |
| FRESHPET, INC. AND SUBSIDIARIES RECONCILIATION BETWEEN NET INCOME (LOSS) AND ADJUSTED EBITDA | |||||||||||||||
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| (Dollars in thousands) | |||||||||||||||
| Net income (loss) | $ | 11,895 | $ | (7,166 | ) | $ | 28,803 | $ | (48,904 | ) | |||||
| Depreciation and amortization | 18,709 | 16,219 | 51,665 | 45,149 | |||||||||||
| Interest income, net of interest expense | (40 | ) | 18 | (424 | ) | 1,463 | |||||||||
| Income tax expense | 54 | 70 | 162 | 210 | |||||||||||
| EBITDA | 30,618 | 9,141 | 80,206 | (2,082 | ) | ||||||||||
| Loss on equity method investment | — | — | — | 1,890 | |||||||||||
| Gain on equity investment | — | — | (9,918 | ) | — | ||||||||||
| Loss on disposal of property, plant and equipment | 768 | 226 | 1,054 | 688 | |||||||||||
| Non-cash share-based compensation (a) | 12,108 | 8,090 | 37,862 | 24,952 | |||||||||||
| Enterprise Resource Planning (b) | — | 212 | — | 1,550 | |||||||||||
| Capped Call Transactions fees (c) | — | — | — | 113 | |||||||||||
| Shareholder activism defense engagement (d) | — | 5,548 | — | 8,177 | |||||||||||
| Organization changes (e) | — | — | — | (67 | ) | ||||||||||
| Adjusted EBITDA | $ | 43,494 | $ | 23,217 | $ | 109,204 | $ | 35,221 | |||||||
| Adjusted EBITDA as a % of Net Sales | 17.2 | % | 11.6 | % | 15.3 | % | 6.4 | % | |||||||
| (a) | Includes true-ups to share-based compensation expense compared to prior periods. We have certain outstanding share-based awards with performance-based vesting conditions that require the achievement of certain Adjusted EBITDA and/or Net Sales targets as a condition of vesting. At each reporting period, we reassess the probability of achieving the performance criteria and the performance period required to meet those targets. When the probability of achieving such performance conditions changes, the compensation cost previously recorded is adjusted as needed. When such performance conditions are deemed to be improbable of achievement, the compensation cost previously recorded is reversed. |
| (b) | Represents costs associated with the implementation of an ERP system. |
| (c) | Represents fees associated with the Capped Call Transactions. |
| (d) | Represents advisory fees related to shareholder activism defense engagement. |
| (e) | Represents a true-up to transition costs related to the organization changes designed to support growth, including several changes in organizational structure designed to enhance capabilities and support long-term growth objectives. |
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