Freshpet Inc. (NASDAQ:FRPT) inventory rallied on Monday after it reported second-quarter 2025 earnings of 33 cents per share, beating the consensus estimate of 16 cents.
Web gross sales rose 12.5% year-over-year to $264.7 million however missed the analyst estimate of $268.9 million. Gross sales development was pushed by a ten.8% improve in quantity and a 1.7% enchancment in worth and blend.
Web earnings was $16.4 million, reversing a internet lack of $1.7 million within the year-ago quarter. Gross revenue rose to $108.2 million, or 40.9% of internet gross sales, up from $94.0 million, or 39.9%.
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Adjusted gross margin improved to 46.9% from 45.9%. Adjusted EBITDA elevated to $44.4 million from $35.1 million, with the margin increasing to 16.8% from 14.9%.
SG&A bills fell to $90.4 million from $95.7 million, or 34.1% of internet gross sales versus 40.7% a yr in the past. Adjusted SG&A totaled $79.6 million, or 30.1% of internet gross sales, in comparison with $72.9 million, or 31.0%, within the prior-year interval.
The corporate reported working money circulation of $38.7 million year-to-date, down $9.1 million from the prior yr, primarily on account of one-time gadgets and better incentive compensation funds. Capital expenditures totaled $59.9 million by the second quarter.
As of June 30, 2025, money and money equivalents stood at $243.7 million, with $396.2 million of debt excellent.
Operationally, Freshpet famous 170 foundation factors of enchancment throughout high quality, enter, and logistics prices within the quarter. Ennis Kitchen turned the corporate’s most worthwhile facility.
A brand new manufacturing line for bagged product is predicted to be commissioned in Bethlehem within the fourth quarter of 2025, with potential retrofits beginning within the second half of 2026. These upgrades are anticipated to cut back capital wants by a minimum of $100 million between 2025 and 2026.
Freshpet’s family penetration rose 11% year-over-year, whereas its Most Beneficial Pet Mother and father (MVPs) cohort elevated 18%. The corporate added 1.4 million households over the previous yr and reported a 6% improve in purchase fee.
Retailer depend reached 29,141 places, with 24% of shops now internet hosting a number of fridges.
“Towards a tougher client sentiment backdrop, we proceed to considerably outperform the pet food class – delivering each class main gross sales development and powerful enhancements in operations,” commented Billy Cyr, Freshpet’s CEO.
“As a nimble development firm that’s adapting to an economically constrained client, we’re intensely targeted on what we will management. That features accelerating our promoting and distribution applications, lowering our capital expenditures, and strengthening our operations. Then again, we will probably be pragmatic about what we will’t management, so we’re revising our present yr’s internet gross sales goal and eradicating our long-term internet gross sales goal to match the atmosphere we face in the present day. We nonetheless consider we’ll ship outsized development for a protracted time frame, however we have to plan for the present financial realities. In whole, we consider the actions we’re taking place us effectively to create important shareholder worth and fulfill our mission to raise the way in which we feed our pets with contemporary meals that nourishes all.”
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