ST. LOUIS, MO. — Post Holdings continues to hold its ground in the pet food market, witnessing increases in profit despite its share in the category remaining flat in the fourth quarter. The company shared this and more in its financial performance for the fourth quarter and 2024 fiscal year ended Sept. 30. 

“In fiscal year 2024, pricing caught up to input costs,” said Robert Vitale, president and chief executive officer of Post during the company’s earnings presentation on Nov. 15. “We made continued improvement in our manufacturing supply chains and sustain the remarkable start for our pet business at over twice our acquisition case. Meanwhile, our diversified portfolio, price points and value-added product offerings continue to provide volume offsets to a challenging consumer backdrop. We are now in an attractive position to return to algorithmic growth with a high degree of optionality provided by our capital structure.”

Post’s pet food business is included in its Consumer Brands segment, which also includes North American products including ready-to-eat, cereal and peanut butter.

For the fourth quarter, net sales for the Consumer Brands division were $1.05 billion, a 3.9% increase from the prior year period. Post attributed $67 million of net sales to its acquisition of Perfection Pet Foods. Excluding this, volume decreased 6.3%, largely attributed to declines in co-manufactured pet food. Segment profit was $140.2 million, a slight decrease of 0.6% from the prior year period. Adjusted EBITDA was $203.7 million, a 2% increase from the prior year period. 

Net sales for the 2024 fiscal year for Post Consumer Brands were $4.12 billion, a 35.5% increase from $3.03 billion in 2023. Segment profit was $541.2 million, a 42.9% increase from $378.8 million in 2023. Adjusted EBITDA was $786 million, a 35.9% increase from the prior year. 

“Excluding the benefit of the Perfection Pet Foods acquisition, Post Consumer brands net sales decreased 3% and volumes decreased 6%,” shared Matt Mainer, senior vice president, chief financial officer and treasurer at Post. “Average net pricing increased 3%, and volumes declined mainly due to Smucker’s Q1 repatriation of pet food we manufactured for them.”

Additionally, Perfection Pet Foods helped improve branded serial performance and led to strong manufacturing and supply chain cost performance for Post, according to Mainer. 

Despite this, the company witnessed drops in consumption volume of about 2%, primarily due to reduced distribution for Nutrish and price elasticity in Gravy Train, according to Jeff Zadoks, executive vice president and chief operating officer of Post. In all, Post’s pet food share remained flat, but the company is beginning to witness stabilization among more premium brands. 

Overall, fourth-quarter net sales for the entire company were $2 billion, a 3.3% increase from $1.95 billion in the prior year period. This included $67 million in net sales from Perfection Pet Foods. Excluding recent acquisitions, including those from The J.M. Smucker Company and Perfection Pet Foods, net sales growth was driven by Post’s Foodservice business and offset by declines in Consumer Brands, which were attributed to volume declines in co-manufactured pet food. 

Gross profit was $575.4 million, a 4.4% increase from $551.4 million in the prior year period. Operating profit was $190.9 million, a 24.8% increase from $153 million in the prior year. Selling, general and administrative (SG&A) expenses were $341.7 million, a 10.4% increase from $309.5 million in the prior year period. 

Net earnings were $81.6 million, a 24.2% increase from $65.7 million. Adjusted EBITDA was $348.7 million, a 0.1% decrease from $349 million in the previous year. 

Net sales for the 2024 fiscal year were $7.92 billion, a 13.3% increase from $6.99 billion in 2023. Gross profit was $2.30 billion, a 22.5% increase from $1.88 billion in the previous year. SG&A expenses were $1.33 billion, a 23.4% increase from $1.08 billion in 2023. These expenses include $36.5 million in integration costs related to Post’s pet food acquisition.  

Operating profit was $793.5 million, a 32.5% increase from $598.9 million in the prior year. Net earnings were $366.7 million, a 21.7% increase from $301.3 million in the prior year. Adjusted EBITDA was $1.40 billion, a 13.8% increase from $1.23 billion in 2023. 

Looking ahead, Post provided guidance for the 2025 fiscal year. The company expects adjusted EBITDA between $1.41 billion and $1.46 billion. Capital expenditures are estimated to range between $380 million to $420 million, which includes continued investments in pet food capacity and safety. 

Regarding pet food, the company is shifting its focus post-acquisition from stabilizing brands to strengthening its premium brands for 2025. This will be led by its relaunch of Nutrish, set to begin at the start of the year. 

“In the short term, I think our greatest opportunity is to drive the existing portfolio that we have, make sure that we do a good job relaunching our premium brands,” Vitale said. “Those had suffered some neglect for a period of time, and they need some investment behind them.”

The company also plans to continue optimizing its facility network within pet food. 

“Ultimately, we are still looking at the network that we both acquired in the two acquisitions and that had been built by Smucker, and trying to determine if we have the right geography,” Vitale shared. “… The Perfection acquisition was in part an opportunity to gain some access to western manufacturing and distribution, so it was a network opportunity. It was also an entry into co-manufacturing. 

“We will likely shrink some of that co-manufacturing business and ultimately move some of our business out West as we determine what the optimal footprint is for delivering to our customers,” he added. “So, we’ve embedded that in the fiscal year 2025 guidance. I think additional benefit from that won’t come until 2026 when we complete that network optimization work.”

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