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Buoys performing well in Q3 2022 and beyond

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st. LOUIS — After a strong third quarter, Post Holding, Inc. has raised its outlook for fiscal 2022. The company increased its adjusted EBITDA guidance from $910 million to $940 million. Momentum from the spin-off of the company’s stake in BellRing Brands, Inc., along with “historic levels of inflation,” helped Post’s stronger third-quarter earnings as it weathered “lingering problems” in his supply chain. It helped provide the foundation.

Post posted net income of $170.2 million for the third quarter ended June 30, equivalent to $2.77 per common share, up dramatically from a loss of $54.3 million in the year-ago quarter. . The most recent quarter included swap income of $131.6 million and a gain of $35.1 million on his investment in BellRing.

Net sales increased 22.2% to $1.5 billion from $1.25 billion a year ago.

President and Chief Executive Officer Robert V. Vitale said in a conference call with analysts on August 5, “We are building momentum into the final quarter of the year and into next year.

“First, we were able to largely offset the impact of inflation on pricing. Input costs remain volatile and we expect additional inflation and additional pricing. We are confident in our ability to provide a percentage margin that has decreased year-over-year, primarily due to the mechanics of our grain-based pricing model in foodservice and a mix shift across our business portfolio.”

Segment profit for the company’s post-consumer brands business declined 7% to $81.8 million in the third quarter from $87.8 million. Net sales he increased to $574.7 million, up 23% from $468.7 million.

“Our North American cereal business continues to benefit from the consumption power of key brands such as Fruity Pebbles and Honey Bunches of Oats, as well as the strength of our own brands and values,” said Vitale. “Our brand share has reached 20% and our total private label has reached 6.7%. Remember, we are the largest provider of private label ready-to-eat cereals. In particular, the Premier Protein Cereal has been very well received.”

Post-Consumer Brands volume increased 13.9% in the fourth quarter.

Segment profit for the Weetabix business was $27.8 million, down 3% from $28.6 million in the year-ago quarter. Net sales increased 1% to $124.9 million from $123.4 million.

Executive Vice President and Chief Financial Officer Jeff A. Zadoks said: “Net sales benefited from significant list price increases and sales from our recently acquired (Lacka Foods Ltd.) brand. offset by configuration.”

In April, The Post acquired Rakka, a UK-based distributor of high-protein, ready-to-drink shakes.

Foodservice profit for the quarter was $45.9 million, up 65% from $27.9 million a year earlier. Third quarter net sales increased 33% to $579 million from $435.1 million. Zadoks said growth in the foodservice business was underpinned by increased distribution and increased out-of-home demand.

“Revenue growth continues to outpace volume growth as earnings reflect the impact of pricing actions and the impact of commodity cost pass-through pricing models,” he said. “Although there was year-over-year growth in the quarter, total segment volume remains below pre-pandemic levels.”

Refrigerated retail segment profit declined in the first quarter, down 27% to $10.4 million from $14.3 million. Net sales increased 12% to $246.4 million from $220.8 million. Vitale said the refrigerated retail sector was hit by bird flu.

“The rising costs of bird flu didn’t pass quickly enough,” he said. “But the business has made great strides year-over-year. Remember last year, supply chain restrictions prevented us from building inventory ahead of the major holiday season? Capacity with third-party manufacturers. and we are well prepared for next season.”

In the three months ended June 30, Post repurchased 1.9 million shares for $145.8 million, averaging an average price per share of $76.43. In the nine months ending June 30, Post repurchased 3.8 million of his shares for his $338.9 million, averaging $89.94 per share. His average price per share over the nine months was $103.79 before the BellRing distribution and $76.43 after the BellRing distribution. As of June 30, Post had his $145.8 million stock repurchase authorization remaining.