ST. LOUIS — Post Holdings, Inc. on Aug. 3 announced its third-quarter earnings for the three-month period ended June 30. The results reflect its acquisition of several pet food brands formerly owned by The J.M. Smucker Company, which was completed on April 28 for $1.2 billion and has since been integrated into the Post Consumer Brands segment.

The company reported net sales of $1.96 billion, up 21.9% year-over-year. Gross profit came to $501.6 million, up 37.5% year-over-year, and accounted for 27% of net sales over the three-month period.

“Net sales increased 22%, driven by the newly acquired pet food business,” said Matt Mainer, chief financial officer at Post Holdings, in the company’s third-quarter earnings call on Aug. 4. “Excluding this acquisition, net sales increased 4%, driven by pricing actions in each segment.”

According to Post, supply chain disruptions have calmed compared to the same period in 2022, but the company continues to incur cost inflation, higher manufacturing costs and “below optimal” fulfillment rates. It has continued to take pricing actions throughout the business to offset impacts from cost inflation.

The Post Consumer Brands division, which includes the recently acquired pet food business, saw net sales of $871.3 million in the third quarter, up 51.6% year-over-year. Roughly $275.3 million in sales was attributed to the new pet food business.

According to Rob Vitale, president and chief executive officer at Post Holdings, margin realization for its pet food division is “exceeding expectations.” He noted three reasons for this: changes in factory leadership and behaviors, which have resulted in improved service levels and inventories; conservative general and administrative assumptions; and putting a hold on investing in the segment’s “brand rehabilitation,” as Vitale put it.

“While we are not going to give specific guidance, it is fair to say our expectations for its contribution have increased in the short-term and meaningfully more so once we move past full integration and synergy realization,” he said. “…In 2024, we will start to reinvest some of the margin upside and seek to revitalize these brands.

“…We expect to be well positioned for FY 2025 as we realize synergies from the pet acquisition, continue to improve supply chains and make incremental investments in marketing,” Vitale added.

The company also shared its nine-month performance, in which Post reported net sales of $5.05 billion, up 18.1% year-over-year. Gross profit grew 23.8% to $1.33 billion and accounted for 26.4% of net sales over the first three quarters of fiscal 2023.

Given these results, Post Holdings has updated its full-year outlook to reflect an adjusted EBITDA between $1.18 billion and $1.20 billion, and capital expenditures for fiscal 2023 are expected between $275 million and $300 million.

“We do feel good about pet, but we feel very good about most of our business,” Vitale said.

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