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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________

FORM 8-K
_________________________

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

November 7, 2024
Date of Report (Date of earliest event reported)
_________________________

Image_0.jpg
Krispy Kreme, Inc.
(Exact name of registrant as specified in its charter)
_________________________

Delaware001-4057337-1701311
(State or other jurisdiction of incorporation)
(Commission File Number)
(IRS Employer Identification No.)
2116 Hawkins Street, Charlotte, North Carolina 28203
(Address of principal executive offices)

(800) 457-4779
(Registrant’s telephone number, including area code)

N/A
(Former name or former address, if changed since last report)
_________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐    Pre-commencement communications pursuant to Rule 13e-14(c) under the Exchange Act (17 CFR 240.13e-14(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each classTrading SymbolName of each exchange on which registered
Common stock, $0.01 par value per share
DNUT
NASDAQ Global Select Market
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐



Item 2.02. Results of Operations and Financial Condition.
The information contained in this Item 2.02, including Exhibit 99.1, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or incorporated by reference in any filing under the Securities Act of 1933, as amended (the "Securities Act"), or the Exchange Act, except as expressly set forth by specific reference in such a filing.
On November 7, 2024, Krispy Kreme, Inc. (the "Company") issued a press release announcing the Company's financial results for the third quarter ended September 29, 2024. A copy of such press release is attached as Exhibit 99.1 and is also available on the Company’s website at investors.krispykreme.com.
Item 9.01. Financial Statements and Exhibits.



SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

KRISPY KREME, INC.

Dated: November 7, 2024

By:    /s/ Jeremiah Ashukian
Name:Jeremiah Ashukian
Title:Chief Financial Officer

EXHIBIT 99.1

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Krispy Kreme reports third quarter 2024 financial results
Third quarter Net Revenue of $379.9 million, Organic Revenue increases 3.5%
CHARLOTTE, NC (November 7, 2024) – Krispy Kreme, Inc. (NASDAQ: DNUT) (“Krispy Kreme”, “KKI”, or the “Company”) today reported financial results for the quarter ended September 29, 2024.
Third Quarter Highlights (vs Q3 2023)
•Net revenue of $379.9 million
•Organic revenue grew 3.5% to $376.4 million
•GAAP net income of $37.6 million, linked to the sale of a majority ownership stake of Insomnia Cookies ($39.6 million net income attributable to KKI)
•Adjusted EBITDA of $34.7 million
•GAAP operating cash flow of $3.3 million
•Global Points of Access (“POA”) increased 2,417, or 18.0%, to 15,811

“Krispy Kreme delivered a seventeenth consecutive quarter of year-over-year organic sales growth driven by increased Delivered Fresh Daily and digital sales,” said Josh Charlesworth, CEO.

“Consumers ask us every day, ‘When can you bring Krispy Kreme to my town?’ hence our strategy of making our fresh doughnuts more available around the world. The successful start of our nationwide U.S. rollout at McDonald’s, which began in Chicago in October and continues next week across Ohio and Indiana, is a major milestone on this journey, and we now expect to be delighting Krispy Kreme’s fans with our melt-in-your-mouth doughnuts fresh daily in nearly 2,000 McDonald’s restaurants by the end of 2024.”

“Now well into my first year as CEO, we have streamlined and focused our business with the sale of our majority stake in Insomnia Cookies complete and the acceleration of our U.S. DFD expansion underway. To better align our talent and our capital to our business priorities, we are now restructuring our management teams to concentrate on maximizing our profitable expansion of the U.S. while focusing international efforts on the wider adoption of our capital-light franchise model. With our resources prioritized to the things that matter most, I believe that these changes will result in a bigger and better Krispy Kreme,” Charlesworth continued.
Financial Highlights
Quarter Ended
$ in millions, except per share dataSeptember 29, 2024October 1, 2023Change
GAAP:
  Net revenue$379.9 $407.4 (6.8)%
  Operating loss$(16.0)$(2.1)nm
  Operating loss margin(4.2)%(0.5)%(370) bps
  Net income/(loss)$37.6 $(40.3)nm
  Net income/(loss) attributable to KKI$39.6 $(40.5)nm
  Diluted income/(loss) per share$0.23 $(0.24)$0.47 
Non-GAAP (1):
  Organic revenue$376.4 $363.8 3.5 %
  Adjusted net (loss)/income, diluted$(2.5)$4.4 nm
  Adjusted EBITDA$34.7 $43.7 (20.7)%
  Adjusted EBITDA margin9.1 %10.7 %(160) bps
  Adjusted diluted (loss)/income per share$(0.01)$0.03 $(0.04)
Notes:
(1)Non-GAAP figures – please refer to Reconciliation of Non-GAAP Financial Measures.




Key Operating Metrics
Quarter Ended
$ in millionsSeptember 29, 2024October 1, 2023Change
Global Points of Access15,811 13,394 18.0 %
Sales per Hub (U.S.) TTM$4.9 $4.8 2.1 %
Sales per Hub (International) TTM$10.1 $9.9 2.0 %
Digital Sales as a Percent of Doughnut Shop Sales15.5 %12.6 %290 bps
Third Quarter 2024 Consolidated Results (vs Q3 2023)
Krispy Kreme’s third-quarter results reflect the sale of a majority ownership stake of Insomnia Cookies. The business is now fully focused on its core strategy of producing, selling and distributing fresh doughnuts daily and executing on its profitable U.S. growth strategy and capital light international model. Net revenue was $379.9 million in Q3 2024, a decline of 6.8%, compared to $407.4 million in the same quarter last year. GAAP Net Income was $37.6 million, including the gain on divestiture of a controlling interest in Insomnia Cookies, compared to prior year net loss of $40.3 million. GAAP diluted earnings per share was $0.23, compared to a loss of $0.24 in the same quarter last year.
Total company organic revenue grew 3.5% compared to the same quarter in the prior year. Delivered Fresh Daily (“DFD”) sales and digital sales both grew 15%, more than offsetting expected consumer softness in U.S. Retail and the U.K.
Adjusted EBITDA was $34.7 million, a decline of 20.7% largely driven by the sale of a majority ownership stake in Insomnia Cookies. Adjusted EBITDA margin declined 160 bps to 9.1%, due to underperformance in the U.K. and incremental vehicle accident claims costs in the U.S. Adjusted Net Loss, diluted was $2.5 million in the quarter. Adjusted Diluted EPS declined to $(0.01) from $0.03 in the same quarter last year.
Third Quarter 2024 Segment Results (vs Q3 2023)
U.S.: In the U.S. segment, net revenue declined $31.8 million, or 12.2%, driven by the $43.5 million impact associated with the sale of a majority ownership stake of Insomnia Cookies in July 2024. Organic revenue growth of $5.5 million, or 2.5%, was driven by a 14% increase in Points of Access and a 21% increase in digital channel revenues.
U.S. Adjusted EBITDA decreased $8.3 million, or 37.5%, with margin declining 250 basis points to 6.1%, due to incremental vehicle accident claims costs and McDonald’s start-up costs, partially offset by pricing and productivity benefits from the Company’s Hub and Spoke model. Following successful pilots with a third-party logistics partner in Los Angeles and Washington, DC, the Company launched an RFP on October 9th with several national and regional carriers for daily delivery of fresh doughnuts to grocers, convenience stores, quick service restaurants, and others.
International: In the International segment, net revenue grew $4.6 million, or 3.7%, with organic revenue growth of $5.3 million or 4.2%, driven by Canada, Japan, and Australia, which more than offset underperformance in the U.K.
International segment Adjusted EBITDA margin improved sequentially despite the seasonally weaker quarter as actions taken to reduce costs delivered improved results. Year over year, Adjusted EBITDA decreased $2.2 million, or 8.7%, with a margin decline of 240 basis points to 17.4%, primarily due to pressure in the U.K. where we have welcomed a new management team focused on improving the business.
Market Development: In the Market Development segment, net revenue declined $0.3 million, or approximately 1.5%, due to the $2.1 million impact of franchise acquisitions in the third quarter of fiscal 2024. Market Development organic revenue grew $1.8 million, or approximately 8.6%, with a new market opening in Morocco alongside continued growth in France, Turkey, and Ecuador.
Market Development Adjusted EBITDA grew $1.5 million, or 14.8%, with margin expansion of 770 basis points delivering Adjusted EBITDA margins of 54.2%, driven by royalty flow through and savings in SG&A.
Balance Sheet and Capital Expenditures
During the third quarter of 2024, Operating Cash Flow was $3.3 million. The Company invested $26.1 million, or 6.9% of net revenue, in capital expenditures, driven primarily by the investments in the Hub and Spoke model for the U.S. expansion of the DFD network. During the quarter, the Company received $117.6 million in net proceeds from the divestiture of Insomnia Cookies and $45.0 million from the repayment of an intercompany loan due from Insomnia Cookies, which was used to reduce long term debt.


2024 Financial Guidance
Krispy Kreme provides the following guidance update for the full year 2024 (vs FY2023) to reflect third quarter results, the acceleration of our expansion with McDonald’s, and the completion of the Insomnia Cookies transaction in July 2024:
•Net Revenue of $1,650 to $1,685 million
•Organic Revenue growth of +5% to +7%
•Adjusted EBITDA of $205 to $210 million
•Adjusted Diluted EPS of $0.18 to $0.22
•Income Tax rate between 28% and 30%
•Capital Expenditures of 7% to 8% of net revenue
•Interest Expense, net of $55 million to $60 million
Definitions
The following definitions apply to terms used throughout this press release:
•Global Points of Access: Reflects all locations at which fresh doughnuts or cookies can be purchased. We define global points of access to include all Hot Light Theater Shops, Fresh Shops, Carts and Food Trucks, DFD Doors and Cookie Shops, at both Company-owned and franchise locations as of the end of the applicable reporting period. We monitor Global Points of Access as a metric that informs the growth of our omni-channel presence over time and believe this metric is useful to investors to understand our footprint in each of our segments.
•Hubs: Reflects locations where fresh doughnuts are produced and processed for sale at any point of access. We define Hubs to include self-sustaining Hot Light Theater Shops and Doughnut Factories, at both Company-owned and franchise locations as of the end of the applicable reporting period.
•Sales Per Hub: Sales per Hub equals Fresh Revenues from Hubs with Spokes, divided by the average number of Hubs with Spokes at the end of each of the five most recent quarters.
•Fresh Revenues from Hubs with Spokes: Fresh Revenues include product sales generated from our Doughnut Shop business (including digital), as well as DFD sales, but excluding sales from Branded Sweet Treats. It also excludes all Insomnia Cookies revenues as the measure is focused on the Krispy Kreme business. Fresh Revenues from Hubs with Spokes equals the Fresh Revenues derived from those Hubs currently producing product for other shops, Carts and Food Trucks, and/or DFD doors, but excluding Fresh Revenues derived from those Hubs not currently producing product for other shops, Carts and Food Trucks, and/or DFD doors.
•Free Cash Flow: Defined as cash provided by operating activities less purchases of property and equipment.
Conference Call
Krispy Kreme will host a public conference call at 8:30 AM Eastern Time today to discuss its results for the third quarter of 2024. The conference call can be accessed by dialing 1 (800) 715-9871 and entering the conference ID 1277949. International participants can access the call via the corresponding number listed HERE and entering the conference ID 1277949. To listen to the live audio webcast and Q&A, visit the Krispy Kreme investor relations website at investors.krispykreme.com. A replay and transcript of the webcast will be available on the website within 24 hours after the call. Krispy Kreme’s earnings press release and related materials will also be available on the investor relations section of the Company’s website.
Investor Relations
ir@krispykreme.com
Financial Media
Edelman Smithfield for Krispy Kreme, Inc.
Ashley Firlan & Ashna Vasa
KrispyKremeIR@edelman.com


About Krispy Kreme
Headquartered in Charlotte, N.C., Krispy Kreme is one of the most beloved and well-known sweet treat brands in the world. Our iconic Original Glazed® doughnut is universally recognized for its hot-off-the-line, melt-in-your-mouth experience. Krispy Kreme operates in 40 countries through its unique network of fresh doughnut shops, partnerships with leading retailers, and a rapidly growing digital business with more than 15,500 fresh points of access. Our purpose of touching and enhancing lives through the joy that is Krispy Kreme guides how we operate every day and is reflected in the love we have for our people, our communities and the planet. Connect with Krispy Kreme Doughnuts at www.KrispyKreme.com, or on one of its many social media channels, including www.Facebook.com/KrispyKreme and www.X.com/KrispyKreme.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements that involve risks and uncertainties. The words “continue,” “towards,” “expect,” “outlook,” “guidance,” “explore,” or similar words, or the negative of these words, identify forward-looking statements. Such forward-looking statements are based on certain assumptions and estimates that we consider reasonable but are subject to various risks and uncertainties relating to our operations, financial results, financial conditions, business, prospects, growth strategy and liquidity. Accordingly, there are, and may be, important factors that could cause our actual results to differ materially from those indicated in these statements. The inclusion of this forward-looking information should not be regarded as a representation by us that the future plans, estimates or expectations contemplated by us will be achieved. Our actual results could differ materially from the forward-looking statements included herein. Factors that could cause actual results to differ from those expressed in forward-looking statements include, without limitation, the risks and uncertainties described under the headings “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2023, filed by us with the Securities and Exchange Commission (“SEC”) and described in the other filings we make from time to time with the SEC. We believe that these factors include, but are not limited to, the impact of pandemics, changes in consumer preferences, the impact of inflation, and our ability to execute on our omni-channel business strategy. These forward-looking statements are made only as of the date of this document, and we do not undertake any obligation, other than as may be required by applicable law, to update or revise any forward-looking or cautionary statement to reflect changes in assumptions, the occurrence of events, unanticipated or otherwise, or changes in future operating results over time or otherwise.
Non-GAAP Measures
This press release includes certain non-GAAP financial measures including organic revenue growth, Adjusted EBITDA, Adjusted Net Income, Diluted, Adjusted Diluted EPS, Net Debt, Fresh Revenue from Hubs with Spokes and Sales per Hub, which differ from results using U.S. Generally Accepted Accounting Principles (“GAAP”). These non-GAAP financial measures are not universally consistent calculations, limiting their usefulness as comparative measures. Other companies may calculate similarly titled financial measures differently than we do or may not calculate them at all. Additionally, these non-GAAP financial measures are not measurements of financial performance under GAAP. In order to facilitate a clear understanding of our consolidated historical operating results, you should examine our non-GAAP financial measures in conjunction with our historical consolidated financial statements and notes thereto filed with the SEC. See “Reconciliation of Non-GAAP Financial Measures” below for reconciliations of our non-GAAP financial measures to the comparable GAAP measures.
To the extent that the Company provides guidance, it does so only on a non-GAAP basis. The Company does not provide reconciliations of such forward-looking non-GAAP measures to GAAP due to the inability to predict the amount and timing of impacts outside of the Company’s control on certain items, such as net income and other charges reflected in our reconciliation of historic numbers, the amount of which, based on historical experience, could be significant.


Krispy Kreme, Inc.
Condensed Consolidated Statements of Operations (Unaudited)
(in thousands, except per share amounts)
Quarter EndedThree Quarters Ended
September 29,
2024 (13 weeks)		October 1,
2023 (13 weeks)		September 29,
2024 (39 weeks)		October 1,
2023 (39 weeks)
Net revenues
Product sales$370,662 $398,745 $1,233,585 $1,209,767 
Royalties and other revenues9,205 8,622 27,789 25,432 
Total net revenues379,867 407,367 1,261,374 1,235,199 
Product and distribution costs95,840 101,353 310,701 330,292 
Operating expenses192,027 195,380 609,726 575,953 
Selling, general and administrative expense71,110 68,305 207,150 192,355 
Marketing expenses10,680 12,478 35,211 32,101 
Pre-opening costs619 1,059 2,691 2,927 
Other income, net(5,781)(1,102)(6,430)(6,051)
Depreciation and amortization expense31,376 32,007 99,562 89,142 
Operating (loss)/income(16,004)(2,113)2,763 18,480 
Interest expense, net16,280 12,807 44,468 36,858 
Gain on divestiture of Insomnia Cookies(87,128)— (87,128)— 
Other non-operating (income)/expense, net(407)971 1,115 3,031 
Income/(loss) before income taxes55,251 (15,891)44,308 (21,409)
Income tax expense17,679 24,367 18,330 17,121 
Net income/(loss)37,572 (40,258)25,978 (38,530)
Net (loss)/income attributable to noncontrolling interest(1,991)199 440 2,005 
Net income/(loss) attributable to Krispy Kreme, Inc.$39,563 $(40,457)$25,538 $(40,535)
Net income/(loss) per share:
Common stock — Basic$0.23 $(0.24)$0.15 $(0.24)
Common stock — Diluted$0.23 $(0.24)$0.15 $(0.24)
Weighted average shares outstanding:
Basic169,596 168,224 169,125 168,183 
Diluted171,486 168,224 171,384 168,183 


Krispy Kreme, Inc.
Condensed Consolidated Balance Sheets
(in thousands, except per share data)
As of
(Unaudited) September 29,
2024		December 31,
2023
ASSETS
Current assets:
Cash and cash equivalents$25,410 $38,185 
Restricted cash474 429 
Accounts receivable, net62,019 59,362 
Inventories31,486 34,716 
Taxes receivable19,406 15,526 
Prepaid expense and other current assets25,531 25,363 
Total current assets164,326 173,581 
Property and equipment, net489,782 538,220 
Goodwill1,060,393 1,101,939 
Other intangible assets, net831,735 946,349 
Operating lease right of use asset, net409,425 456,964 
Investments in unconsolidated entities91,033 2,806 
Other assets18,430 20,733 
Total assets$3,065,124 $3,240,592 
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt$47,577 $54,631 
Current operating lease liabilities45,767 50,365 
Accounts payable123,125 156,488 
Accrued liabilities119,832 134,005 
Structured payables139,170 130,104 
Total current liabilities475,471 525,593 
Long-term debt, less current portion804,638 836,615 
Noncurrent operating lease liabilities406,726 454,583 
Deferred income taxes, net119,291 123,925 
Other long-term obligations and deferred credits49,858 36,093 
Total liabilities1,855,984 1,976,809 
Commitments and contingencies
Shareholders’ equity:
Common stock, $0.01 par value; 300,000 shares authorized as of both September 29, 2024 and December 31, 2023; 169,799 and 168,628 shares issued and outstanding as of September 29, 2024 and December 31, 2023, respectively1,698 1,686 
Additional paid-in capital1,460,416 1,443,591 
Shareholder note receivable(1,924)(3,850)
Accumulated other comprehensive (loss)/income, net of income tax(9,276)7,246 
Retained deficit(271,238)(278,990)
Total shareholders’ equity attributable to Krispy Kreme, Inc.1,179,676 1,169,683 
Noncontrolling interest29,464 94,100 
Total shareholders’ equity1,209,140 1,263,783 
Total liabilities and shareholders’ equity$3,065,124 $3,240,592 


Krispy Kreme, Inc.
Condensed Consolidated Statements of Cash Flows (Unaudited)
(in thousands)
Three Quarters Ended
September 29,
2024 (39 weeks)		October 1,
2023 (39 weeks)
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES:
Net income/(loss)$25,978 $(38,530)
Adjustments to reconcile net income/(loss) to net cash provided by operating activities:
Depreciation and amortization expense99,562 89,142 
Deferred and other income taxes(22)12,634 
Loss on extinguishment of debt— 472 
Impairment and lease termination charges368 7,711 
Loss/(gain) on disposal of property and equipment470 (168)
Gain on divestiture of Insomnia Cookies(87,128)— 
Gain on remeasurement of equity method investment(5,579)— 
Gain on sale-leaseback— (9,646)
Share-based compensation24,603 17,821 
Change in accounts and notes receivable allowances433 504 
Inventory write-off1,731 10,522 
Settlement of interest rate swap derivatives— 7,657 
Amortization related to settlement of interest rate swap derivatives(5,910)(7,334)
Other263 566 
Change in operating assets and liabilities, excluding business acquisitions and divestitures, and foreign currency translation adjustments(35,982)(47,319)
Net cash provided by operating activities18,787 44,032 
CASH FLOWS PROVIDED BY/(USED FOR) INVESTING ACTIVITIES:
Purchase of property and equipment(86,877)(88,605)
Proceeds from sale-leaseback— 10,025 
Acquisition of shops and franchise rights from franchisees, net of cash acquired(26,612)—
Purchase of equity method investment(3,506)—
Net proceeds from divestiture of Insomnia Cookies117,646 —
Principal payment received from loan to Insomnia Cookies45,000 —
Disbursement for loan receivable(1,086)—
Other investing activities180 222 
Net cash provided by/(used for) investing activities44,745 (78,358)
CASH FLOWS (USED FOR)/PROVIDED BY FINANCING ACTIVITIES:
Proceeds from the issuance of debt490,000 1,044,698 
Repayment of long-term debt and lease obligations(545,692)(965,250)
Payment of financing costs— (5,000)
Proceeds from structured payables298,551 145,099 
Payments on structured payables(264,346)(159,571)
Payment of contingent consideration related to a business combination— (925)
Capital contribution by shareholders, net of loans issued919 631 
Proceeds from sale of noncontrolling interest in subsidiary364 — 
Distribution to shareholders(17,743)(17,657)
Payments for repurchase and retirement of common stock(4,366)(1,609)
Distribution to noncontrolling interest(35,035)(12,883)
Net cash (used for)/provided by financing activities(77,348)27,533 
Effect of exchange rate changes on cash, cash equivalents and restricted cash1,086 (2,796)
Net decrease in cash, cash equivalents and restricted cash(12,730)(9,589)
Cash, cash equivalents and restricted cash at beginning of period38,614 35,730 
Cash, cash equivalents and restricted cash at end of period$25,884 $26,141 
Net cash provided by operating activities$18,787 $44,032 
Less: Purchase of property and equipment(86,877)(88,605)
Free cash flow$(68,090)$(44,573)


Krispy Kreme, Inc.
Reconciliation of Non-GAAP Financial Measures (Unaudited)
(in thousands, except per share amounts)
We define “Adjusted EBITDA” as earnings before interest expense, net, income tax expense, and depreciation and amortization, with further adjustments for share-based compensation, certain strategic initiatives, acquisition and integration expenses, and other certain non-recurring, infrequent or non-core income and expense items. Adjusted EBITDA is a principal metric that management uses to monitor and evaluate operating performance and provides a consistent benchmark for comparison across reporting periods.
We define “Adjusted Net Income, Diluted” as net loss attributable to common shareholders, adjusted for interest expense, share-based compensation, certain strategic initiatives, acquisition and integration expenses, amortization of acquisition-related intangibles, the tax impact of adjustments, and other certain non-recurring, infrequent or non-core income and expense items. “Adjusted EPS” is Adjusted Net Income, Diluted converted to a per share amount.
Adjusted EBITDA, Adjusted Net Income, Diluted, and Adjusted EPS have certain limitations, including adjustments for income and expense items that are required by GAAP. In evaluating these non-GAAP measures, you should be aware that in the future we will incur expenses that are the same as or similar to some of the adjustments in this presentation, such as share-based compensation. Our presentation of Adjusted EBITDA, Adjusted Net Income, Diluted, and Adjusted EPS should not be construed to imply that our future results will be unaffected by any such adjustments. Management compensates for these limitations by relying on our GAAP results in addition to using Adjusted EBITDA, Adjusted Net Income, Diluted, and Adjusted EPS supplementally.
Quarter Ended Three Quarters Ended
(in thousands)September 29, 2024October 1, 2023September 29, 2024October 1, 2023
Net income/(loss)$37,572 $(40,258)$25,978 $(38,530)
Interest expense, net16,280 12,807 44,468 36,858 
Income tax expense17,679 24,367 18,330 17,121 
Depreciation and amortization expense31,376 32,007 99,562 89,142 
Share-based compensation9,969 7,452 24,603 17,821 
Employer payroll taxes related to share-based compensation49 96 299 310 
Gain on divestiture of Insomnia Cookies(87,128)— (87,128)— 
Other non-operating (income)/expense, net (1)
(407)971 1,115 3,031 
Strategic initiatives (2)
11,426 5,895 20,434 23,841 
Acquisition and integration expenses (3)
1,938 49 3,037 479 
New market penetration expenses (4)
156 678 1,194 1,013 
Shop closure expenses/(income), net (5)
21 (449)788 356 
Restructuring and severance expenses (6)
631 552 769 2,799 
Gain on remeasurement of equity method investment (7)
(5,579)— (5,579)— 
Gain on sale-leaseback— — — (9,646)
Other (8)
716 (426)(257)2,888 
Adjusted EBITDA$34,699 $43,741 $147,613 $147,483 
Quarter Ended Three Quarters Ended
(in thousands)September 29, 2024October 1, 2023September 29, 2024October 1, 2023
Segment Adjusted EBITDA:
U.S.$13,922 $22,258 $89,206 $88,878 
International22,779 24,961 64,970 68,645 
Market Development11,271 9,816 36,046 31,862 
Corporate(13,273)(13,294)(42,609)(41,902)
Total Adjusted EBITDA$34,699 $43,741 $147,613 $147,483 


Quarter Ended Three Quarters Ended
(in thousands, except per share amounts)September 29, 2024October 1, 2023September 29, 2024October 1, 2023
Net income/(loss)$37,572 $(40,258)$25,978 $(38,530)
Share-based compensation9,969 7,452 24,603 17,821 
Employer payroll taxes related to share-based compensation49 96 299 310 
Gain on divestiture of Insomnia Cookies(87,128)— (87,128)— 
Other non-operating (income)/expense, net (1)
(407)971 1,115 3,031 
Strategic initiatives (2)
11,426 5,895 20,434 23,841 
Acquisition and integration expenses (3)
1,938 49 3,037 479 
New market penetration expenses (4)
156 678 1,194 1,013 
Shop closure expenses/(income) (5)
21 (449)788 356 
Restructuring and severance expenses (6)
631 552 769 2,799 
Gain on remeasurement of equity method investment (7)
(5,579)— (5,579)— 
Gain on sale-leaseback— — — (9,646)
Other (8)
716 (426)(257)2,888 
Amortization of acquisition related intangibles (9)
7,780 7,386 22,597 22,027 
Loss on extinguishment of 2019 Facility (10)
— — — 472 
Tax impact of adjustments (11)
20,766 22,694 13,765 8,574 
Tax specific adjustments (12)
(2,395)(28)(3,210)(2,343)
Net loss/(income) attributable to noncontrolling interest1,991 (199)(440)(2,005)
Adjusted net (loss)/income attributable to common shareholders - Basic$(2,494)$4,413 $17,965 $31,087 
Additional income attributed to noncontrolling interest due to subsidiary potential common shares(4)(7)(28)(14)
Adjusted net (loss)/income attributable to common shareholders - Diluted$(2,498)$4,406 $17,937 $31,073 
Basic weighted average common shares outstanding169,596 168,224 169,125 168,183 
Dilutive effect of outstanding common stock options, RSUs, and PSUs— 2,421 2,259 2,249 
Diluted weighted average common shares outstanding169,596 170,645 171,384 170,432 
Adjusted net (loss)/income per share attributable to common shareholders:
Basic$(0.01)$0.03$0.11$0.18
Diluted$(0.01)$0.03$0.10$0.18
(1)Primarily foreign translation gains and losses in each period.
(2)The quarter and three quarters ended September 29, 2024 consist primarily of costs associated with the divestiture of the Insomnia Cookies business, preparing for the McDonald’s U.S. expansion, and global transformation (with these three specific initiatives aggregating to approximately $11.3 million and $20.0 million for the quarter and three quarters ended September 29, 2024, respectively). The quarter and three quarters ended October 1, 2023 consist primarily of costs associated with global transformation and U.S. initiatives such as the decision to exit the Branded Sweet Treats business, including property, plant and equipment impairments, inventory write-offs, employee severance, and other related costs.
(3)Consists of acquisition and integration-related costs in connection with the Company’s business and franchise acquisitions, including legal, due diligence, and advisory fees incurred in connection with acquisition and integration-related activities for the applicable period.
(4)Consists of start-up costs associated with entry into new countries for which the Company’s brands have not previously operated, including Brazil and Spain.
(5)Includes lease termination costs, impairment charges, and loss on disposal of property, plant and equipment. The quarter and three quarters ended October 1, 2023 include gains related to the termination of leases at certain Krispy Kreme shops in the U.S. where the Company had already recognized impairment of the corresponding right of use assets in a prior period.


(6)The quarter and three quarters ended September 29, 2024 consists primarily of costs associated with the restructuring of the KK U.K. executive team. The quarter and three quarters ended October 1, 2023 consists primarily of costs associated with restructuring of the global executive team.
(7)Consists of a gain related to the remeasurement of the equity method investments in KremeWorks USA, LLC and KremeWorks Canada, L.P. to fair value immediately prior to the acquisition of the shops.
(8)The quarter and three quarters ended September 29, 2024 and October 1, 2023 consist primarily of legal and other regulatory expenses incurred outside the ordinary course of business. The three quarters ended September 29, 2024 also include a gain from insurance proceeds received related to a shop in the U.S. that was destroyed and subsequently rebuilt.
(9)Consists of amortization related to acquired intangible assets as reflected within depreciation and amortization in the Condensed Consolidated Statements of Operations.
(10)Includes interest expenses related to unamortized debt issuance costs from the 2019 Facility associated with extinguished lenders as a result of the March 2023 debt refinancing.
(11)Tax impact of adjustments calculated applying the applicable statutory rates. The quarter and three quarters ended September 29, 2024 and October 1, 2023 also include the impact of disallowed executive compensation expense.
(12)The quarter and three quarters ended September 29, 2024 consist of the recognition of previously unrecognized tax benefits unrelated to ongoing operations, a discrete tax benefit unrelated to ongoing operations, the release of valuation allowances on state net operating losses associated with the divestiture of Insomnia Cookies, and the effect of various tax law changes on existing temporary differences. The quarter and three quarters ended October 1, 2023 consist of the recognition of a previously unrecognized tax benefit unrelated to ongoing operations, the effect of tax law changes on existing temporary differences, and a discrete tax benefit unrelated to ongoing operations.



Krispy Kreme, Inc.
Segment Reporting (Unaudited)
(in thousands, except percentages or otherwise stated)
 Quarter Ended Three Quarters Ended
September 29, 2024October 1, 2023September 29, 2024October 1, 2023
Net revenues:
 
 
 
 
U.S.$228,376 $260,177 $813,615 $808,938 
International130,697 126,077 380,716 358,653 
Market Development20,794 21,113 67,043 67,608 
Total net revenues$379,867 $407,367 $1,261,374 $1,235,199 
Q3 2024 Organic Revenue - QTD
(in thousands, except percentages)
U.S.
International
Market Development
Total Company
Total net revenues in third quarter of fiscal 2024$228,376 $130,697 $20,794 $379,867 
Total net revenues in third quarter of fiscal 2023
260,177 126,077 21,113 407,367 
Total Net Revenues Growth(31,801)4,620 (319)(27,500)
Total Net Revenues Growth %-12.2 %3.7 %-1.5 %-6.8 %
Less: Impact of Insomnia Cookies divestiture(43,531)— — (43,531)
Adjusted net revenues in third quarter of fiscal 2023216,646 126,077 21,113 363,836 
Adjusted net revenue growth11,730 4,620 (319)16,031 
Impact of acquisitions(6,228)(1,108)2,127 (5,209)
Impact of foreign currency translation— 1,770 — 1,770 
Organic Revenue Growth$5,502 $5,282 $1,808 $12,592 
Organic Revenue Growth %2.5 %4.2 %8.6 %3.5 %
Q3 2024 Organic Revenue - YTD
(in thousands, except percentages)
U.S.
International
Market Development
Total Company
Total net revenues in first three quarters of fiscal 2024$813,615 $380,716 $67,043 $1,261,374 
Total net revenues in first three quarters of fiscal 2023
808,938 358,653 67,608 1,235,199 
Total Net Revenues Growth4,677 22,063 (565)26,175 
Total Net Revenues Growth %0.6 %6.2 %-0.8 %2.1 %
Less: Impact of shop optimization program closures(463)— — (463)
Less: Impact of Branded Sweet Treats exit(5,853)— — (5,853)
Less: Impact of Insomnia Cookies divestiture(43,531)— — (43,531)
Adjusted net revenues in first three quarters of fiscal 2023759,091 358,653 67,608 1,185,352 
Adjusted net revenue growth54,524 22,063 (565)76,022 
Impact of acquisitions(6,228)(1,108)2,127 (5,209)
Impact of foreign currency translation— 1,338 — 1,338 
Organic Revenue Growth$48,296 $22,293 $1,562 $72,151 
Organic Revenue Growth %6.4 %6.2 %2.3 %6.1 %


Q3 2023 Organic Revenue - QTD
(in thousands, except percentages)
U.S.
International
Market Development
Total Company
Total net revenues in third quarter of fiscal 2023$260,177 $126,077 $21,113 $407,367 
Total net revenues in third quarter of fiscal 2022246,830 107,585 23,107 377,522 
Total Net Revenues Growth13,347 18,492 (1,994)29,845 
Total Net Revenues Growth %5.4 %17.2 %-8.6 %7.9 %
Less: Impact of shop optimization program closures(3,096)— — (3,096)
Less: Impact of Branded Sweet Treats exit(9,035)— — (9,035)
Adjusted net revenues in third quarter of fiscal 2022234,699 107,585 23,107 365,391 
Adjusted net revenue growth25,478 18,492 (1,994)41,976 
Impact of acquisitions(1,575)— 457 (1,118)
Impact of foreign currency translation— (5,912)— (5,912)
Organic Revenue Growth$23,903 $12,580 $(1,537)$34,946 
Organic Revenue Growth %10.2 %11.7 %-6.7 %9.6 %
Q3 2023 Organic Revenue - YTD
(in thousands, except percentages)
U.S.
International
Market Development
Total Company
Total net revenues in first three quarters of fiscal 2023$808,938 $358,653 $67,608 $1,235,199 
Total net revenues in first three quarters of fiscal 2022739,414 322,636 63,249 1,125,299 
Total Net Revenues Growth69,524 36,017 4,359 109,900 
Total Net Revenues Growth %9.4 %11.2 %6.9 %9.8 %
Less: Impact of shop optimization program closures(9,613)— — (9,613)
Less: Impact of Branded Sweet Treats exit(15,736)— — (15,736)
Adjusted net revenues in first three quarters of fiscal 2022714,065 322,636 63,249 1,099,950 
Adjusted net revenue growth94,873 36,017 4,359 135,249 
Impact of acquisitions(7,678)— 2,227 (5,451)
Impact of foreign currency translation— (118)— (118)
Organic Revenue Growth$87,195 $35,899 $6,586 $129,680 
Organic Revenue Growth %12.2 %11.1 %10.4 %11.8 %


Trailing Four Quarters EndedFiscal Year Ended
(in thousands, unless otherwise stated)September 29,
2024		December 31,
2023		January 1,
2023
U.S.:
Revenues$1,109,621 $1,104,944 $1,010,250 
Non-Fresh Revenues (1)
(3,857)(9,416)(38,380)
Fresh Revenues from Insomnia Cookies and Hubs without Spokes (2)
(360,354)(399,061)(404,430)
Sales from Hubs with Spokes745,410 696,467 567,440 
Sales per Hub (millions)4.9 4.9 4.5 
International:
Sales from Hubs with Spokes (3)
$511,694 $489,631 $435,651 
Sales per Hub (millions) (4)
10.1 10.0 9.7 
(1)Includes the exited Branded Sweet Treats business revenues as well as licensing royalties from customers for use of the Krispy Kreme brand.
(2)Includes Insomnia Cookies revenues (through the date of the divestiture) and Fresh Revenues generated by Hubs without Spokes.
(3)Total International net revenues is equal to Fresh Revenues from Hubs with Spokes for that business segment.
(4)International Sales per Hub comparative data has been restated in constant currency based on current exchange rates.



Krispy Kreme, Inc.
Global Points of Access (Unaudited)

Global Points of Access
Quarter EndedFiscal Year Ended
September 29, 2024October 1, 2023December 31, 2023
U.S.:
Hot Light Theater Shops236 229 229 
Fresh Shops71 65 70 
Cookie Bakeries (3)
— 249 267 
DFD Doors (2)
7,711 6,506 6,808 
Total8,018 7,049 7,374 
International:
Hot Light Theater Shops48 45 44 
Fresh Shops508 479 483 
Carts, Food Trucks, and Other (1)
17 16 16 
DFD Doors
4,867 3,588 3,977 
Total5,440 4,128 4,520 
Market Development:
Hot Light Theater Shops110 113 116 
Fresh Shops1,059 920 968 
Carts, Food Trucks, and Other (1)
30 29 30 
DFD Doors
1,154 1,155 1,139 
Total2,353 2,217 2,253 
Total Global Points of Access (as defined)15,811 13,394 14,147 
Total Hot Light Theater Shops394 387 389 
Total Fresh Shops1,638 1,464 1,521 
Total Cookie Bakeries (3)
— 249 267 
Total Shops2,032 2,100 2,177 
Total Carts, Food Trucks, and Other47 45 46 
Total DFD Doors13,732 11,249 11,924 
Total Global Points of Access (as defined)15,811 13,394 14,147 
(1)Carts and Food Trucks are non-producing, mobile (typically on wheels) facilities without walls or a door where product is received from a Hot Light Theater Shop or Doughnut Factory. Other includes a vending machine. Points of Access in this category are primarily found in international locations in airports, train stations, etc.
(2)Includes over 160 McDonald’s shops located in Louisville and Lexington, Kentucky and the surrounding area as of June 30, 2024.
(3)Reflects the divestiture of Insomnia Cookies during the quarter ended September 29, 2024.


Krispy Kreme, Inc.
Global Hubs (Unaudited)

Hubs
Quarter EndedFiscal Year Ended
September 29, 2024October 1, 2023December 31, 2023
U.S.:
Hot Light Theater Shops (1)
230 222 220 
Doughnut Factories6 4 4 
Total236 226 224 
Hubs with Spokes152 148 149 
Hubs without Spokes84 78 75 
International:
Hot Light Theater Shops (1)
39 36 36 
Doughnut Factories14 14 14 
Total53 50 50 
Hubs with Spokes53 50 50 
Market Development:
Hot Light Theater Shops (1)
108 109 112 
Doughnut Factories26 23 23 
Total134 132 135 
Total Hubs423 408 409 
(1)Includes only Hot Light Theater Shops and excludes Mini Theaters. A Mini Theater is a Spoke location that produces some doughnuts for itself and also receives doughnuts from another producing location.


Krispy Kreme, Inc.
Net Debt and Leverage (Unaudited)
(in thousands, except leverage ratio)

September 29, 2024December 31, 2023
Current portion of long-term debt$47,577 $54,631 
Long-term debt, less current portion804,638 836,615 
Total long-term debt, including debt issuance costs
852,215 891,246 
Add back: Debt issuance costs3,584 4,371 
Total long-term debt, excluding debt issuance costs
855,799 895,617 
Less: Cash and cash equivalents(25,410)(38,185)
Net debt$830,389 $857,432 
Adjusted EBITDA - trailing four quarters211,754 211,624 
Net leverage ratio3.9 x4.1 x

v3.24.3
Cover Page Document
Nov. 07, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Nov. 07, 2024
Entity Registrant Name Krispy Kreme, Inc.
Entity Incorporation, State or Country Code DE
Entity File Number 001-40573
Entity Tax Identification Number 37-1701311
Entity Address, Address Line One 2116 Hawkins Street
Entity Address, City or Town Charlotte
Entity Address, State or Province NC
Entity Address, Postal Zip Code 28203
City Area Code 800
Local Phone Number 457-4779
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common stock, $0.01 par value per share
Trading Symbol DNUT
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Entity Central Index Key 0001857154
Amendment Flag false
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