Post Holdings Reports Results for the Fourth Quarter and Fiscal
Year 2021
Post Holdings, Inc. (NYSE:POST), a consumer packaged goods holding
company, today reported results for the fourth fiscal quarter and
fiscal year ended September 30, 2021.
Highlights:
- Fourth quarter net sales of $1.7 billion; operating
profit of $137.8 million; net earnings of $29.9 million and
Adjusted EBITDA of $272.5 million
- Fiscal year net sales of $6.2 billion; operating profit
of $655.7 million; net earnings of $166.7 million and Adjusted
EBITDA of $1,123.3 million
- Generated $588.3 million in cash from operations in
fiscal year 2021
- Fiscal year 2022 Adjusted EBITDA (non-GAAP) expected to
range between $1.16-$1.20 billion including the full year results
of BellRing Brands
Fourth Quarter Consolidated Operating
Results
Net sales were $1,695.6 million, an increase of 20.1%, or $284.3
million, compared to $1,411.3 million in the prior year period, and
included $99.8 million in net sales from acquisitions made in
fiscal year 2021. More information on these acquisitions is
discussed later in this release. Gross profit was $428.5 million,
or 25.3% of net sales, a decrease of 2.7%, or $11.8 million,
compared to $440.3 million, or 31.2% of net sales, in the prior
year period. Results for the fourth quarter of 2021 reflect the
ongoing volume demand recovery of the Foodservice segment, strong
growth at BellRing Brands and pricing actions, which were more than
offset by input and freight inflation and higher manufacturing
costs. Labor shortages and supply chain disruptions drove
manufacturing inefficiencies during the fourth quarter of 2021,
resulting in missed sales, declines in throughput and higher per
unit product costs.
Selling, general and administrative (“SG&A”) expenses were
$241.7 million, or 14.3% of net sales, an increase of 5.2%, or
$11.9 million, compared to $229.8 million, or 16.3% of net sales,
in the prior year period. Operating profit was $137.8 million, a
decrease of 23.0%, or $41.1 million, compared to $178.9 million in
the prior year period.
Net earnings were $29.9 million, a decrease of 47.5%, or $27.1
million, compared to net earnings of $57.0 million in the prior
year period. Net earnings included the following:
| |
Three Months Ended September 30, |
| (in millions) |
2021 |
|
2020 |
|
Income on swaps, net (1) |
$ |
(17.2 |
) |
|
|
$ |
(5.3 |
) |
|
| United Kingdom (“U.K.”) tax
reform expense (1) |
0.7 |
|
|
|
13.0 |
|
|
| Equity method losses, net of
tax |
17.4 |
|
|
|
8.3 |
|
|
| Net earnings attributable to
noncontrolling interest (2) |
19.3 |
|
|
|
10.3 |
|
|
| |
|
|
|
| (1) Discussed
later in this release and was treated as an adjustment for non-GAAP
measures. |
| (2) Primarily
reflected the allocation of 28.8% and 69.0% of BellRing Brands,
Inc.’s (“BellRing”) and Post Holdings Partnering Corporation’s
(“PHPC”), respectively, consolidated net earnings to noncontrolling
interest. |
| |
Diluted earnings per common share were $0.39, compared to
diluted earnings per common share of $0.83 in the prior year
period. Adjusted net earnings were $28.4 million, or $0.44 per
diluted common share, compared to $52.5 million, or $0.77 per
diluted common share, in the prior year period.
Adjusted EBITDA was $272.5 million, a decrease of 0.8%, or $2.3
million, compared to $274.8 million in the prior year period.
Adjusted EBITDA in the fourth quarter of 2021 and 2020 included an
adjustment of $18.8 million and $9.8 million, respectively,
primarily for the portion of BellRing’s and PHPC’s consolidated net
earnings which was allocated to noncontrolling interest, resulting
in Adjusted EBITDA including 100% of the consolidated Adjusted
EBITDA of BellRing and PHPC.
Fiscal Year 2021 Consolidated Operating
Results
Net sales were $6,226.7 million, an increase of 9.3%, or $528.0
million, compared to $5,698.7 million in the prior year. Gross
profit was $1,814.3 million, or 29.1% of net sales, an increase of
1.5%, or $26.9 million, compared to $1,787.4 million, or 31.4% of
net sales, in the prior year.
SG&A expenses were $974.1 million, or 15.6% of net sales, an
increase of 4.3%, or $39.8 million, compared to $934.3 million, or
16.4% of net sales, in the prior year. Operating profit was $655.7
million, a decrease of 6.4%, or $44.8 million, compared to $700.5
million in the prior year, and included $29.9 million of
accelerated amortization which was treated as an adjustment for
non-GAAP measures.
Net earnings were $166.7 million, an increase of $165.9 million,
compared to $0.8 million in the prior year. Net earnings included
the following:
| |
Year Ended September 30, |
| (in millions) |
2021 |
|
2020 |
|
Loss on extinguishment and refinancing of debt, net (1) |
$ |
94.8 |
|
|
|
$ |
72.9 |
|
| (Income) expense on swaps, net
(1) |
(122.8 |
) |
|
|
187.1 |
|
| U.K. tax reform expense
(1) |
40.0 |
|
|
|
13.0 |
|
| Equity method losses, net of
tax |
43.9 |
|
|
|
30.9 |
|
| Net earnings attributable to
noncontrolling interest (2) |
40.0 |
|
|
|
28.2 |
|
| |
|
|
|
| (1) Discussed
later in this release and were treated as adjustments for non-GAAP
measures. |
| (2) Primarily
reflected the allocation of 28.8% and 69.0% of BellRing’s and
PHPC’s, respectively, consolidated net earnings to noncontrolling
interest. |
| |
Diluted earnings per common share were $2.38, compared to $0.01
in the prior year. Adjusted net earnings were $156.0 million, or
$2.39 per diluted common share, compared to $202.8 million, or
$2.89 per diluted common share in the prior year.
Adjusted EBITDA was $1,123.3 million, a decrease of $17.2
million, compared to $1,140.5 million in the prior year. Adjusted
EBITDA for fiscal years 2021 and 2020 included an adjustment of
$38.2 million and $26.4 million, respectively, primarily for the
portion of BellRing’s and PHPC’s consolidated net earnings which
was allocated to noncontrolling interest, resulting in Adjusted
EBITDA including 100% of the consolidated Adjusted EBITDA of
BellRing and PHPC.
Recent Acquisitions
The table below lists Post’s recent acquisitions, including the
acquisition date, the fiscal year in which the acquisition was
completed and the segment in which the results of the acquisition
are reported.
|
Acquisition |
Acquisition Date |
Fiscal Year |
Segment |
|
Private label ready-to-eat cereal business of TreeHouse Foods, Inc.
(the “PL RTE Cereal Business”) |
June 1, 2021 |
2021 |
Post Consumer Brands |
| Egg Beaters liquid egg brand
(“Egg Beaters”) |
May 27, 2021 |
2021 |
Refrigerated Retail |
| Almark Foods business and
related assets (“Almark”) |
February 1, 2021 |
2021 |
Foodservice and Refrigerated
Retail |
| Peter Pan nut butter brand
(“Peter Pan”) |
January 25, 2021 |
2021 |
Post Consumer Brands |
| Henningsen Foods, Inc.
(“Henningsen”) |
July 1, 2020 |
2020 |
Foodservice |
| |
|
|
|
Post Consumer Brands
North American ready-to-eat (“RTE”) cereal and Peter Pan nut
butters.
For the fourth quarter, net sales were $521.7 million, an
increase of 10.6%, or $49.8 million, compared to the prior year
period, and included $66.0 million in combined net sales from the
PL RTE Cereal Business and Peter Pan. Volumes increased 7.4%
(including a 1,270 basis point benefit from the PL RTE Cereal
Business and Peter Pan). Excluding the benefit from acquisitions,
volumes declined driven by (i) continuing broader softness across
value and private label cereal products, (ii) losses resulting from
the decision to exit certain low-margin private label business and
(iii) licensed brands. Segment profit was $66.5 million, a decrease
of 28.4%, or $26.4 million, compared to the prior year period.
Segment Adjusted EBITDA was $105.2 million, a decrease of 13.3%, or
$16.1 million, compared to the prior year period.
For fiscal year 2021, net sales were $1,915.3 million, a
decrease of 1.7%, or $33.8 million, compared to the prior year.
Segment profit was $316.6 million, a decrease of 19.5%, or $76.9
million, compared to the prior year. Segment profit for fiscal year
2021 was negatively impacted by a provision of $15.0 million for a
legal settlement, which was treated as an adjustment for non-GAAP
measures. Segment Adjusted EBITDA was $460.5 million, a decrease of
9.3%, or $47.4 million, compared to the prior year.
Weetabix
Primarily U.K. RTE cereal and muesli.
For the fourth quarter, net sales were $127.2 million, an
increase of 11.9%, or $13.5 million, compared to the prior year
period, and reflected a favorable foreign currency exchange rate
tailwind of approximately 710 basis points. Volumes were flat as
growth in new product introductions, private label and drink
products was offset by declines in all other products. These
declines were driven by lapping increased purchases in the prior
year period resulting from increased at-home consumption in
reaction to the COVID-19 pandemic. Segment profit was $32.8
million, an increase of 17.1%, or $4.8 million, compared to the
prior year period. Segment Adjusted EBITDA was $42.7 million, an
increase of 12.7%, or $4.8 million, compared to the prior year
period.
For fiscal year 2021, net sales were $477.5 million, an increase
of 8.4%, or $37.1 million, compared to the prior year. Segment
profit was $115.4 million, an increase of 2.8%, or $3.1 million,
compared to the prior year. Segment Adjusted EBITDA was $152.8
million, an increase of 4.2%, or $6.2 million, compared to the
prior year.
Foodservice
Primarily egg and potato products.
For the fourth quarter, net sales were $456.8 million, an
increase of 42.5%, or $136.3 million, compared to the prior year
period, and included $13.1 million in net sales from Almark.
Volumes increased 23.1% (including a 180 basis point benefit from
Almark), driven by significantly higher away-from-home demand in
the current year period. Egg volumes increased 21.1% (including a
230 basis point benefit from Almark) and potato volumes increased
34.3%. Segment profit was $14.2 million, an increase of 389.8%, or
$19.1 million, compared to the prior year period. Segment Adjusted
EBITDA was $55.6 million, an increase of 134.6%, or $31.9 million,
compared to the prior year period. When compared to the prior year
period, fourth quarter 2021 segment profit and segment Adjusted
EBITDA benefited from volume recovery and improvements in average
net pricing and fixed cost absorption.
For fiscal year 2021, net sales were $1,615.6 million, an
increase of 18.6%, or $253.8 million, compared to the prior year.
Segment profit was $61.7 million, an increase of 141.0%, or $36.1
million, compared to the prior year. Segment Adjusted EBITDA was
$197.0 million, an increase of 36.8%, or $53.0 million, compared to
the prior year.
Refrigerated Retail
Primarily side dish, egg, cheese and sausage products.
For the fourth quarter, net sales were $251.1 million, an
increase of 12.4%, or $27.7 million, compared to the prior year
period, and included $20.6 million in combined net sales from Egg
Beaters and Almark. Volumes increased 9.7% (including an 810 basis
point benefit from Egg Beaters and Almark), with growth in side
dish and egg products partially offset by declines in sausage and
cheese products. Volume information by product is disclosed in a
table presented later in this release. Segment profit was $3.7
million, a decrease of 86.3%, or $23.4 million, compared to the
prior year period. Segment Adjusted EBITDA was $24.0 million, a
decrease of 48.1%, or $22.2 million, compared to the prior year
period.
For fiscal year 2021, net sales were $974.5 million, an increase
of 1.4%, or $13.3 million, compared to the prior year. Segment
profit was $75.9 million, a decrease of 39.6%, or $49.7 million,
compared to the prior year. Segment Adjusted EBITDA was $151.7
million, a decrease of 24.3%, or $48.8 million, compared to the
prior year.
BellRing Brands
Ready-to-drink (“RTD”) protein shakes, other RTD beverages,
powders and nutrition bars.
For the fourth quarter, net sales were $340.0 million, an
increase of 20.3%, or $57.4 million, compared to the prior year
period. Premier Protein net sales increased 18.2% and benefited
from (i) RTD shake distribution gains for both existing and new
products, (ii) strong velocities driven in part by promotional
activity and continued category momentum and (iii) higher average
net selling prices driven by price increases to offset cost
inflation. Net sales for Dymatize increased 41.3% and for all other
products increased 7.6%. Segment profit was $53.1 million, an
increase of 8.4%, or $4.1 million, compared to the prior year
period. Segment Adjusted EBITDA was $60.5 million, an increase of
6.7%, or $3.8 million, compared to the prior year period. Fourth
quarter 2021 segment profit and segment Adjusted EBITDA margins
were negatively impacted by a decline in gross profit margin driven
by higher input costs (predominantly freight and whey-based and
milk-based proteins) and planned promotional activity.
For fiscal year 2021, net sales were $1,247.1 million, an
increase of 26.2%, or $258.8 million, compared to the prior year.
Segment profit was $168.0 million, an increase of 2.4%, or $4.0
million. Fiscal year 2021 segment profit reflects $29.9 million of
accelerated amortization (incurred in connection with the
discontinuance of the Supreme Protein brand), $5.2 million of
restructuring and facility closure costs and $1.7 million of
lower transaction costs related to BellRing’s separation from Post,
each of which were treated as adjustments for non-GAAP measures.
Segment Adjusted EBITDA was $233.9 million, an increase of 18.6%,
or $36.7 million, compared to the prior year.
As of September 30, 2021, BellRing had $609.9 million in total
principal value of debt and $152.6 million in cash and cash
equivalents.
For further information, please refer to the BellRing fourth
quarter and fiscal year 2021 earnings release and conference call
(the details of which are included later in this release).
Interest, Loss on Extinguishment and Refinancing of
Debt, (Income) Expense on Swaps and Income Tax
Interest expense, net was $92.5 million in the fourth quarter of
2021, compared to $95.3 million in the fourth quarter of 2020.
Interest expense, net included $9.6 million and $13.5 million
attributable to BellRing in the fourth quarter of 2021 and 2020,
respectively. In fiscal year 2021, interest expense, net was $375.8
million, compared to $388.6 million in fiscal year 2020. Interest
expense, net in fiscal year 2021 included $43.2 million
attributable to BellRing. Interest expense, net in fiscal year 2020
included (i) $54.7 million attributable to BellRing and (ii) a loss
of $7.2 million resulting from the reclassification of losses
previously recorded in accumulated other comprehensive loss to
interest expense.
Loss on extinguishment and refinancing of debt, net of $94.8
million was recorded in fiscal year 2021 in connection with (i)
Post’s repayment of its 5.00% senior notes due in August 2026 and
(ii) an opportunistic repricing of BellRing Brands, LLC’s
(“BellRing LLC”) term loan in February 2021. Loss on extinguishment
of debt, net of $72.9 million was recorded in fiscal year 2020 in
connection with (i) Post’s repayment of its 5.50% senior notes due
in March 2025 and 8.00% senior notes due in July 2025, (ii) Post’s
repayment of the entire principal balance of its term loan in the
first quarter of 2020, (iii) the assignment of debt to BellRing LLC
related to the creation of BellRing’s capital structure in the
first quarter of 2020 and (iv) the amendment and restatement of
Post’s credit agreement in March 2020.
(Income) expense on swaps, net relates to mark-to-market
adjustments on interest rate swaps. Income on swaps, net was $17.2
million in the fourth quarter of 2021, compared to $5.3 million in
the fourth quarter of 2020. For fiscal year 2021, income on swaps,
net was $122.8 million, compared to an expense of $187.1 million in
fiscal year 2020.
Income tax expense was $5.4 million in the fourth quarter of
2021, an effective income tax rate of 7.5%, compared to $15.2
million in the fourth quarter of 2020, an effective income tax rate
of 16.7%. For fiscal year 2021, income tax expense was $86.6
million, an effective income tax rate of 25.7%, compared to $3.5
million in fiscal year 2020, an effective income tax rate of 5.5%.
In fiscal year 2021, as a result of enacted tax law changes in the
U.K., which included a provision to increase the U.K.’s corporate
income tax rate from 19% to 25% effective April 1, 2023, Post
recorded a $40.0 million income tax expense related to the
remeasurement of Post’s U.K. deferred tax assets and liabilities
considering the 25% U.K. corporate income tax rate for future
periods. In fiscal year 2020, the effective income tax rate
differed significantly from the statutory tax rate primarily as a
result of a rate differential on foreign income and discrete tax
benefits, which largely related to Post’s equity method investment
in 8th Avenue Food & Provisions, Inc. (“8th Avenue”).
Additionally, in fiscal year 2020, as a result of enacted tax law
changes in the U.K., which included a provision to increase the
U.K.’s corporate income tax rate from 17% to 19%, Post recorded a
$13.0 million income tax expense related to the remeasurement of
Post’s U.K. deferred tax assets and liabilities considering the 19%
U.K. corporate income tax rate for future periods.
Share Repurchases and New Share Repurchase
Authorization
During the fourth quarter of 2021, Post repurchased 0.7 million
shares of its common stock for $78.3 million at an average price of
$110.50 per share. During fiscal year 2021, Post repurchased 4.0
million shares of its common stock for $393.6 million at an average
price of $98.37 per share. Subsequent to the end of the fourth
quarter of 2021 and as of November 17, 2021, Post repurchased 0.7
million shares of its common stock for $78.7 million at an average
price of $105.66 per share. On November 17, 2021, Post’s Board of
Directors approved a new $400 million share repurchase
authorization. Share repurchases under the new authorization may
begin on November 20, 2021. As of November 17, 2021, Post had
purchased $223.4 million under its previous $400 million share
repurchase authorization, which became effective on February 6,
2021, and will be cancelled effective November 19, 2021.
Repurchases may be made from time to time in the open market, in
private purchases, through forward, derivative, accelerated
repurchase or automatic purchase transactions, or otherwise. The
shares would be repurchased with cash on hand and cash from
operations. Any shares repurchased would be held as treasury stock.
The authorization does not, however, obligate Post to acquire any
particular amount of shares, and repurchases may be suspended or
terminated at any time at Post’s discretion.
BellRing Enters into Agreement with Post to Increase RTD
Shake Capacity
BellRing and Post have entered into an agreement in which Post
will purchase and develop land with the intent to build an aseptic
processing facility to produce RTD shakes for BellRing. BellRing
and Post expect to enter into a contract manufacturing agreement.
BellRing and Post expect to provide further details as progress is
made.
Post’s Plan to Distribute Its Interest in BellRing to
Post Shareholders
On October 27, 2021, Post and BellRing announced the signing of
a transaction agreement related to Post’s previously announced plan
to distribute a significant portion of its interest in BellRing to
Post’s shareholders. The parties expect the distribution to be
completed in the first calendar quarter of 2022, subject to certain
customary conditions, including the receipt of certain tax opinions
and the approval of BellRing’s stockholders (including the approval
of BellRing’s stockholders other than Post). There can be no
assurance that the proposed transaction will be completed as
anticipated or at all. Please refer to the press release dated
October 27, 2021 for further information.
COVID-19 Commentary
Post continues to closely monitor the impact of the COVID-19
pandemic on its business and remains focused on ensuring the health
and safety of its employees and serving customers and
consumers.
Post products sold through retail channels generally experienced
an uplift in sales starting in March 2020 and continuing through
the first half of fiscal year 2021 driven by increased at-home
consumption in reaction to the COVID-19 pandemic. In addition, most
of Post’s retail categories exhibited a mix shift to premium
products. In the second half of fiscal year 2021, most of Post’s
retail channel product categories trended toward growth rates in
line with their pre-pandemic levels.
At the onset of the COVID-19 pandemic, Post’s foodservice
business was significantly impacted by lower away-from-home demand
resulting from the impact of the COVID-19 pandemic on various
channels, including full service restaurants, quick service
restaurants, education and travel and lodging. Since then, the
recovery of Post’s foodservice volumes has been closely tracking
with changes in the degree of restrictions on mobility and
gathering. Volumes in certain channels and product categories have
nearly fully recovered to pre-pandemic levels. Volumes in other
channels impacted by the COVID-19 pandemic have recovered from low
levels experienced at the height of the pandemic, but have recently
plateaued at levels below pre-pandemic volumes. In the aggregate,
overall foodservice volumes remain below pre-pandemic levels.
As the overall economy continues to recover from the impact of
the COVID-19 pandemic, labor shortages, input and freight inflation
and other supply chain disruptions, including input availability,
are pressuring Post’s supply chains in all segments resulting in
missed sales and higher manufacturing costs, most notably in
foodservice and refrigerated retail. Per unit product costs
escalated as throughput declined and fixed cost absorption
worsened. Service levels and fill rates remain below normal levels,
and inventories are low, resulting in the placement of certain
products on allocation. These factors are expected to persist into
fiscal year 2022 and are dependent upon Post’s ability to
adequately hire, train and retain manufacturing staff, maintain
sufficient supplies of ingredients and packaging and rebuild
inventory levels.
Volume and profit recovery in Post’s foodservice business is
dependent on both changes in the degree of restrictions on mobility
and gathering and on the ability to navigate supply chain
disruptions. Post expects its foodservice business to return to
pre-pandemic profitability in fiscal year 2023. Volume growth in
Post’s refrigerated retail business, most notably for side dish
products, is expected to be constrained until supply chain
performance has stabilized.
BellRing COVID-19 Commentary
BellRing’s primary categories returned to growth rates in line
with their pre-pandemic levels in the fourth quarter of fiscal year
2020 and have remained strong in subsequent periods. As the overall
economy continues to recover from the impact of the COVID-19
pandemic, input and freight inflation, equipment delays and input
and labor availability are pressuring BellRing’s supply chain.
Lower than anticipated production and delays in capacity expansion
across the broader third party shake contract manufacturer have
resulted in low inventories and missed sales. Service levels and
fill rates remain below normal levels, and certain products have
been placed on allocation. These factors are expected to improve
but persist throughout fiscal year 2022 and are dependent upon
BellRing’s contract manufacturer partners’ ability to deliver
committed volumes, add capacity on expected timelines, retain
manufacturing staff and rebuild inventory levels.
Outlook
Post management expects Adjusted EBITDA for fiscal year 2022 to
be between $1.16-$1.20 billion, including BellRing for the full
year. Compared to prior years, fiscal year 2022 is expected to be
more weighted to the second half as Post prices incremental
inflation and navigates lingering supply chain disruptions. Post
management expects the first quarter to be particularly impacted
and performance to sequentially improve in each quarter throughout
the year. This outlook range assumes that by the end of the first
half of fiscal year 2022 the rate of inflation has peaked and labor
markets have normalized.
Post management expects Post’s fiscal year 2022 capital
expenditures to range between $250-$300 million. This includes
approximately $50 million for the purchase of land and construction
of a new facility with the intent to manufacture RTD shakes for
BellRing.
Post provides Adjusted EBITDA guidance only on a non-GAAP basis
and does not provide a reconciliation of its forward-looking
Adjusted EBITDA non-GAAP guidance measure to the most directly
comparable GAAP measure due to the inherent difficulty in
forecasting and quantifying certain amounts that are necessary for
such reconciliation, including adjustments that could be made for
income/expense on swaps, net, gain/loss on extinguishment and
refinancing of debt, net, noncontrolling interest adjustment,
equity method investment adjustment, mark-to-market adjustments on
commodity and foreign exchange hedges and warrant liabilities and
equity securities, gain on/adjustment to bargain purchase,
provision for legal settlements, transaction and integration costs
and other charges reflected in Post’s reconciliations of historical
numbers, the amounts of which, based on historical experience,
could be significant. For additional information regarding Post’s
non-GAAP measures, see the related explanations presented under
“Post’s Use of Non-GAAP Measures.”
BellRing Outlook
For fiscal year 2022, BellRing management expects net sales and
Adjusted EBITDA each to grow 9%-13% over fiscal year 2021
(resulting in a net sales range of $1.36-$1.41 billion and an
Adjusted EBITDA range of $255-$265 million).
BellRing management expects the following:
- Net sales growth to be high single digits in the first half of
2022 and mid teens in the second half of 2022, with sequential
improvement in each quarter throughout the year as incremental
capacity comes online. As previously discussed, the accelerated
growth experienced in fiscal year 2021 exceeded BellRing’s current
shake manufacturing capacity. As a result, inventories are low and
expected to recover throughout fiscal year 2022.
- Adjusted EBITDA growth is weighted
toward the second half of 2022, with Adjusted EBITDA margins flat
as the benefits from pricing actions and lower brand investments
are offset by significant inflation.
BellRing management expects fiscal year 2022 capital
expenditures of approximately $4 million.
BellRing provides Adjusted EBITDA guidance only on a non-GAAP
basis and does not provide a reconciliation of its forward-looking
Adjusted EBITDA non-GAAP guidance measure to the most directly
comparable GAAP measure due to the inherent difficulty in
forecasting and quantifying certain amounts that are necessary for
such reconciliation, including adjustments that could be made for
restructuring and facility closures costs, separation costs, net
earnings attributable to redeemable noncontrolling interest and
other charges reflected in BellRing’s reconciliation of historical
numbers, the amounts of which, based on historical experience,
could be significant. For additional information regarding
BellRing’s non-GAAP measures, see the related explanations
presented under “Use of Non-GAAP Measures” in BellRing’s fourth
quarter and fiscal year 2021 earnings release. BellRing, as a
separate publicly-traded company, releases guidance regarding its
future performance. These statements are prepared by BellRing’s
management, and Post does not accept any responsibility for any
such statements.
8th Avenue Standalone Financial Information
Post owns a 60.5% common equity interest in 8th Avenue, which is
an unconsolidated affiliate that manufactures and distributes
private label peanut and other nut butters, pasta, dried fruit and
nut products and granola.
For the fourth quarter, net sales were $236.3 million, an
increase of 3.2%, or $7.3 million, compared to the prior year
period. Net loss was $16.1 million, a decrease of 631.8%, or $13.9
million, compared to the prior year period. Adjusted EBITDA was
$14.8 million, a decrease of 34.5%, or $7.8 million, compared to
the prior year period.
For fiscal year 2021, net sales were $900.8 million, a decrease
of 2.5%, or $23.4 million, compared to the prior year. Net loss was
$24.3 million, a decrease of 279.7%, or $17.9 million, compared to
the prior year. Adjusted EBITDA was $75.2 million, a decrease of
20.2%, or $19.0 million, compared to the prior year.
As of September 30, 2021, 8th Avenue was capitalized with $17.9
million of unrestricted cash and cash equivalents, $735.6 million
of senior secured debt, $60.1 million related to a sale-leaseback
transaction, $250.0 million in principal amount of preferred equity
and $97.9 million of accumulated, but unpaid, preferred dividends.
Summarized financial information for 8th Avenue is disclosed later
in this release.
Post’s Use of Non-GAAP Measures
Post uses certain non-GAAP measures in this release to
supplement the financial measures prepared in accordance with U.S.
generally accepted accounting principles (“GAAP”). These non-GAAP
measures include total segment profit, Adjusted net earnings,
Adjusted diluted earnings per common share, Adjusted EBITDA for
Post and 8th Avenue and segment Adjusted EBITDA. The reconciliation
of each of these non-GAAP measures to the most directly comparable
GAAP measure is provided later in this release under “Explanation
and Reconciliation of Non-GAAP Measures” and “Explanation and
Reconciliation of 8th Avenue’s Non-GAAP Measure.”
Management uses certain of these non-GAAP measures, including
Adjusted EBITDA and segment Adjusted EBITDA, as key metrics in the
evaluation of underlying company and segment performance, in making
financial, operating and planning decisions and, in part, in the
determination of bonuses for its executive officers and employees.
Additionally, Post is required to comply with certain covenants and
limitations that are based on variations of EBITDA in its financing
documents. Management believes the use of these non-GAAP measures
provides increased transparency and assists investors in
understanding the underlying operating performance of Post and its
segments and in the analysis of ongoing operating
trends. Non-GAAP measures are not prepared in accordance with
GAAP, as they exclude certain items as described later in this
release. These non-GAAP measures may not be comparable to similarly
titled measures of other companies. For additional information
regarding Post’s non-GAAP measures, see the related explanations
provided under “Explanation and Reconciliation of Non-GAAP
Measures” and “Explanation and Reconciliation of 8th Avenue’s
Non-GAAP Measure” later in this release.
Post Conference Call to Discuss Earnings Results and
Outlook
Post will host a conference call on Friday, November 19, 2021 at
9:00 a.m. EST to discuss financial results for the fourth quarter
and fiscal year 2021 and fiscal year 2022 outlook and to respond to
questions. Robert V. Vitale, President and Chief Executive Officer,
and Jeff A. Zadoks, Executive Vice President and Chief Financial
Officer, will participate in the call.
Interested parties may join the conference call by dialing (877)
876-9174 in the United States and (785) 424-1669 from outside of
the United States. The conference identification number is
POSTQ421. Interested parties are invited to listen to the webcast
of the conference call, which can be accessed by visiting the
Investor Relations section of Post’s website at
www.postholdings.com.
A replay of the conference call will be available through
Friday, November 26, 2021 by dialing (800) 938-2490 in the United
States and (402) 220-9028 from outside of the United States. A
webcast replay also will be available for a limited period on
Post’s website in the Investor Relations section.
BellRing Conference Call to Discuss Earnings Results and
Outlook
BellRing will host a conference call on Friday, November 19,
2021 at 10:30 a.m. EST to discuss financial results for the fourth
quarter and fiscal year 2021 and fiscal year 2022 outlook and to
respond to questions. Darcy H. Davenport, President and Chief
Executive Officer, and Paul A. Rode, Chief Financial Officer, will
participate in the call.
Interested parties may join the conference call by dialing (877)
876-9173 in the United States and (785) 424-1667 from outside of
the United States. The conference identification number is
BRBRQ421. Interested parties are invited to listen to the webcast
of the conference call, which can be accessed by visiting the
Investor Relations section of BellRing’s website at
www.bellring.com. A slide presentation containing supplemental
material will also be available at the same location on BellRing’s
website.
A replay of the conference call will be available through
Friday, November 26, 2021 by dialing (800) 753-9146 in the United
States and (402) 220-2705 from outside of the United States. A
webcast replay also will be available for a limited period on
BellRing’s website in the Investor Relations section.
Prospective Financial Information
Prospective financial information is necessarily speculative in
nature, and it can be expected that some or all of the assumptions
underlying the prospective financial information described above
will not materialize or will vary significantly from actual
results. For further discussion of some of the factors that may
cause actual results to vary materially from the information
provided above, see “Forward-Looking Statements” below.
Accordingly, the prospective financial information provided above
is only an estimate of what Post’s and BellRing’s management
believes is realizable as of the date of this release. It also
should be recognized that the reliability of any forecasted
financial data diminishes the farther in the future that the data
is forecasted. In light of the foregoing, the information should be
viewed in context and undue reliance should not be placed upon
it.
Additional Information Regarding the Proposed
Distribution of Post’s Interest in BellRing and Where to Find
It
This communication does not constitute an offer to sell, the
solicitation of an offer to sell or the solicitation of an offer to
buy any securities, nor shall there be any sale of securities in
any jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. No offer of securities
shall be made except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act of 1933, as
amended. In connection with the proposed transaction, BellRing
Distribution, LLC (“New BellRing”) and BellRing intend to file
relevant materials with the Securities and Exchange Commission
(“the SEC”), including a proxy statement of BellRing, a prospectus
of New BellRing and any other applicable registration statement to
be filed in connection with the separation. INVESTORS AND SECURITY
HOLDERS ARE URGED TO READ THE REGISTRATION STATEMENTS/PROSPECTUSES,
PROXY STATEMENT AND ANY OTHER RELEVANT DOCUMENTS WHEN THEY BECOME
AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT NEW
BELLRING, BELLRING AND THE PROPOSED TRANSACTION. Investors and
security holders will be able to obtain these materials (when they
are available) and other documents filed with the SEC free of
charge from the SEC’s website, www.sec.gov, Post’s website,
www.postholdings.com, or BellRing’s website, www.bellring.com.
The transaction and distribution of this communication may be
restricted by law in certain jurisdictions and persons who come
into possession of any document or other information referred to
herein should inform themselves about and observe any such
restrictions. Any failure to comply with these restrictions may
constitute a violation of the securities laws of any such
jurisdiction. No offering of securities will be made, directly or
indirectly, in or into any jurisdiction where to do so would be
inconsistent with the laws of such jurisdiction.
Participants in a Solicitation
Post, BellRing, New BellRing and their respective directors and
executive officers and other members of management and employees
may be deemed to be participants in the solicitation of proxies
from BellRing’s stockholders with respect to the approvals required
to complete the proposed transaction. More detailed information
regarding the identity of these potential participants, and any
direct or indirect interests they may have in the proposed
transaction, by security holdings or otherwise, will be set forth
in the BellRing proxy statement when filed with the SEC.
Information regarding the directors and executive officers of Post
is available in its definitive proxy statement, which was filed
with the SEC on December 7, 2020. Information regarding the
directors and executive officers of BellRing is available in its
definitive proxy statement, which was filed with the SEC on January
20, 2021. Free copies of these documents may be obtained as
described above.
Forward-Looking Statements
Certain matters discussed in this release and on Post’s
conference call are forward-looking statements, including Post’s
Adjusted EBITDA outlook for fiscal year 2022, Post’s capital
expenditure outlook for fiscal year 2022, including statements
regarding the purchase of land and construction of a new facility
to manufacture RTD shakes, statements regarding the effect of the
COVID-19 pandemic on Post’s business, including the effect on
BellRing’s business, Post’s and BellRing’s continuing response to
the COVID-19 pandemic, the proposed transaction between Post and
BellRing for the distribution of a significant portion of Post’s
interest in BellRing to Post’s shareholders, including the amount
of BellRing equity Post intends to distribute, the form of
distribution and the expected timing of the completion of the
proposed transaction and BellRing’s net sales, Adjusted EBITDA and
capital expenditures outlook for fiscal year 2022. These
forward-looking statements are sometimes identified from the use of
forward-looking words such as “believe,” “should,” “could,”
“potential,” “continue,” “expect,” “project,” “estimate,”
“predict,” “anticipate,” “aim,” “intend,” “plan,” “forecast,”
“target,” “is likely,” “will,” “can,” “may” or “would” or the
negative of these terms or similar expressions, and include all
statements regarding future performance, earnings projections,
events or developments. There are a number of risks and
uncertainties that could cause actual results to differ materially
from the forward-looking statements made herein. These risks and
uncertainties include, but are not limited to, the following:
- the impact of the COVID-19 pandemic, including negative impacts
on Post’s ability to manufacture and deliver its products,
workforce availability, the health and safety of Post’s employees,
operating costs, demand for its foodservice and on-the-go products,
the global economy and capital markets and Post’s operations
generally;
- Post’s high leverage, Post’s ability to obtain additional
financing (including both secured and unsecured debt), Post’s
ability to service its outstanding debt (including covenants that
restrict the operation of Post’s businesses) and a downgrade or
potential downgrade in Post’s credit ratings;
- disruptions or inefficiencies in Post’s supply chain, including
as a result of Post’s reliance on third parties for the supply of
materials for and the manufacture of many of Post’s products,
pandemics (including the COVID-19 pandemic) and other outbreaks of
contagious diseases, labor shortages, fires and evacuations related
thereto, changes in weather conditions, natural disasters, climate
change, agricultural diseases and pests and other events beyond
Post’s control;
- significant volatility in the cost or availability of inputs to
Post’s businesses (including freight, raw materials, energy and
other supplies);
- Post’s ability to hire and retain talented personnel, increases
in labor-related costs, the ability of Post’s employees to safely
perform their jobs, including the potential for physical injuries
or illness (such as COVID-19), employee absenteeism, labor strikes,
work stoppages and unionization efforts;
- Post’s ability to continue to compete in its product categories
and Post’s ability to retain its market position and favorable
perceptions of its brands;
- Post’s ability to anticipate and respond to changes in consumer
and customer preferences and behaviors and introduce new
products;
- changes in economic conditions, disruptions in the U.S. and
global capital and credit markets, changes in interest rates,
volatility in the market value of derivatives and fluctuations in
foreign currency exchange rates;
- allegations that Post’s products cause injury or illness,
product recalls and withdrawals and product liability claims and
other related litigation;
- Post’s ability to identify, complete and integrate or otherwise
effectively execute acquisitions or other strategic transactions
and effectively manage its growth;
- Post’s ability to successfully execute the proposed
distribution of its interest in BellRing and realize the strategic
and financial benefits from the proposed transactions;
- the possibility that PHPC, a publicly-traded special purpose
acquisition company in which Post indirectly owns an interest
(through PHPC Sponsor, LLC, Post’s wholly-owned subsidiary), may
not consummate a suitable partnering transaction within the
prescribed two-year time period, that the partnering transaction
may not be successful or that the activities for PHPC could be
distracting to Post’s management;
- conflicting interests or the appearance of conflicting
interests resulting from several of Post’s directors and officers
also serving as directors or officers of one or more of Post’s
related companies;
- impairment in the carrying value of goodwill or other
intangibles, or other-than-temporary impairment in the carrying
value of investments in unconsolidated subsidiaries;
- Post’s ability to successfully implement business strategies to
reduce costs;
- legal and regulatory factors, such as compliance with existing
laws and regulations, as well as new laws and regulations and
changes to existing laws and regulations and interpretations
thereof, affecting Post’s businesses, including current and future
laws and regulations regarding tax matters, food safety,
advertising and labeling, animal feeding and housing operations and
environmental matters;
- the loss of, a significant reduction of purchases by or the
bankruptcy of a major customer;
- the failure or weakening of the RTE cereal category and
consolidations in the retail and foodservice distribution
channels;
- the ultimate impact litigation or other regulatory matters may
have on Post;
- costs, business disruptions and reputational damage associated
with information technology failures, cybersecurity incidents or
information security breaches;
- Post’s ability to successfully collaborate with third parties
that have invested with Post in 8th Avenue and to effectively
realize the strategic and financial benefits expected as a result
of the separate capitalization of 8th Avenue;
- costs associated with the obligations of Bob Evans Farms, Inc.
(“Bob Evans”) in connection with the sale and separation of its
restaurants business in April 2017, which occurred prior to Post’s
acquisition of Bob Evans, including certain indemnification
obligations under the restaurants sale agreement and Bob Evans’s
payment and performance obligations as a guarantor for certain
leases;
- Post’s ability to protect its intellectual property and other
assets and to continue to use third party intellectual property
subject to intellectual property licenses;
- the ability of Post’s and its customers’, and 8th Avenue’s and
its customers’, private brand products to compete with nationally
branded products;
- risks associated with Post’s international businesses;
- changes in estimates in critical accounting judgments;
- losses or increased funding and expenses related to Post’s
qualified pension or other postretirement plans;
- significant differences in Post’s, 8th Avenue’s and BellRing’s
actual operating results from any of Post’s guidance regarding
Post’s and 8th Avenue’s future performance and BellRing’s guidance
regarding its future performance;
- Post’s, BellRing’s and PHPC’s ability to satisfy the
requirements of Section 404 of the Sarbanes-Oxley Act of 2002;
and
- other risks and uncertainties described in Post’s, BellRing’s
and PHPC’s filings with the SEC.
These forward-looking statements represent Post’s judgment as of
the date of this release except with respect to BellRing’s guidance
regarding its future performance, which represents BellRing’s
judgment as of the date of this release. Post disclaims, however,
any intent or obligation to update these forward-looking
statements.
About Post Holdings, Inc.
Post Holdings, Inc., headquartered in St. Louis, Missouri, is a
consumer packaged goods holding company operating in the
center-of-the-store, refrigerated, foodservice, food ingredient and
convenient nutrition food categories. Its businesses include Post
Consumer Brands, Weetabix, Michael Foods, Bob Evans Farms and
BellRing Brands. Post Consumer Brands is a leader in the North
American ready-to-eat cereal category and also markets Peter Pan®
nut butters. Weetabix is home to the United Kingdom’s number one
selling ready-to-eat cereal brand, Weetabix®. Michael Foods and Bob
Evans Farms are leaders in refrigerated foods, delivering
innovative, value-added egg and refrigerated potato side dish
products to the foodservice and retail channels. Post’s
publicly-traded subsidiary BellRing Brands, Inc. is a holding
company operating in the global convenient nutrition category
through its primary brands of Premier Protein® and Dymatize®. Post
participates in the private brand food category through its
investment with third parties in 8th Avenue Food & Provisions,
Inc., a leading, private brand centric, consumer products holding
company. For more information, visit www.postholdings.com.
Contact:Investor RelationsJennifer
Meyerjennifer.meyer@postholdings.com(314) 644-7665
Media RelationsLisa Hanlylisa.hanly@postholdings.com(314)
665-3180
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)(in millions, except per share
data)
| |
Three Months EndedSeptember
30, |
|
Year Ended September 30, |
| |
2021 |
|
2020 |
|
2021 |
|
2020 |
|
Net Sales |
$ |
1,695.6 |
|
|
|
$ |
1,411.3 |
|
|
|
$ |
6,226.7 |
|
|
|
$ |
5,698.7 |
|
|
| Cost of goods sold |
1,267.1 |
|
|
|
971.0 |
|
|
|
4,412.4 |
|
|
|
3,911.3 |
|
|
| Gross
Profit |
428.5 |
|
|
|
440.3 |
|
|
|
1,814.3 |
|
|
|
1,787.4 |
|
|
| Selling, general and
administrative expenses |
241.7 |
|
|
|
229.8 |
|
|
|
974.1 |
|
|
|
934.3 |
|
|
| Amortization of intangible
assets |
41.6 |
|
|
|
40.1 |
|
|
|
194.4 |
|
|
|
160.3 |
|
|
| Other operating expenses
(income), net |
7.4 |
|
|
|
(8.5 |
) |
|
|
(9.9 |
) |
|
|
(7.7 |
) |
|
| Operating
Profit |
137.8 |
|
|
|
178.9 |
|
|
|
655.7 |
|
|
|
700.5 |
|
|
| Interest expense, net |
92.5 |
|
|
|
95.3 |
|
|
|
375.8 |
|
|
|
388.6 |
|
|
| Loss on extinguishment and
refinancing of debt, net |
— |
|
|
|
— |
|
|
|
94.8 |
|
|
|
72.9 |
|
|
| (Income) expense on swaps,
net |
(17.2 |
) |
|
|
(5.3 |
) |
|
|
(122.8 |
) |
|
|
187.1 |
|
|
| Other income, net |
(9.5 |
) |
|
|
(1.9 |
) |
|
|
(29.3 |
) |
|
|
(11.5 |
) |
|
| Earnings before Income
Taxes and Equity Method Loss |
72.0 |
|
|
|
90.8 |
|
|
|
337.2 |
|
|
|
63.4 |
|
|
| Income tax expense |
5.4 |
|
|
|
15.2 |
|
|
|
86.6 |
|
|
|
3.5 |
|
|
| Equity method loss, net of
tax |
17.4 |
|
|
|
8.3 |
|
|
|
43.9 |
|
|
|
30.9 |
|
|
| Net Earnings Including
Noncontrolling Interest |
49.2 |
|
|
|
67.3 |
|
|
|
206.7 |
|
|
|
29.0 |
|
|
| Less: Net earnings
attributable to noncontrolling interest |
19.3 |
|
|
|
10.3 |
|
|
|
40.0 |
|
|
|
28.2 |
|
|
| Net
Earnings |
$ |
29.9 |
|
|
|
$ |
57.0 |
|
|
|
$ |
166.7 |
|
|
|
$ |
0.8 |
|
|
| |
|
|
|
|
|
|
|
| Earnings per Common
Share: |
|
|
|
|
|
|
|
| Basic |
$ |
0.40 |
|
|
|
$ |
0.85 |
|
|
|
$ |
2.42 |
|
|
|
$ |
0.01 |
|
|
| Diluted |
$ |
0.39 |
|
|
|
$ |
0.83 |
|
|
|
$ |
2.38 |
|
|
|
$ |
0.01 |
|
|
| |
|
|
|
|
|
|
|
| Weighted-Average
Common Shares Outstanding: |
|
|
|
|
|
|
|
| Basic |
63.5 |
|
|
|
67.3 |
|
|
|
64.2 |
|
|
|
68.9 |
|
|
| Diluted |
64.6 |
|
|
|
68.4 |
|
|
|
65.3 |
|
|
|
70.1 |
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONSOLIDATED BALANCE SHEETS
(Unaudited)(in millions)
| |
September 30, 2021 |
|
September 30, 2020 |
| |
|
|
|
|
ASSETS |
| Current
Assets |
|
|
|
|
Cash and cash equivalents |
$ |
817.1 |
|
|
|
$ |
1,187.9 |
|
|
|
Restricted cash |
7.1 |
|
|
|
5.5 |
|
|
|
Receivables, net |
553.9 |
|
|
|
441.6 |
|
|
|
Inventories |
594.5 |
|
|
|
599.4 |
|
|
|
Prepaid expenses and other current assets |
113.5 |
|
|
|
53.4 |
|
|
|
Total Current Assets |
2,086.1 |
|
|
|
2,287.8 |
|
|
| |
|
|
|
| Property, net |
1,839.4 |
|
|
|
1,779.7 |
|
|
| Goodwill |
4,567.5 |
|
|
|
4,438.6 |
|
|
| Other intangible assets,
net |
3,147.5 |
|
|
|
3,197.5 |
|
|
| Equity method investments |
70.7 |
|
|
|
114.1 |
|
|
| Investments held in trust |
345.0 |
|
|
|
— |
|
|
| Other assets |
358.5 |
|
|
|
329.0 |
|
|
|
Total Assets |
$ |
12,414.7 |
|
|
|
$ |
12,146.7 |
|
|
| |
|
|
|
| |
|
|
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY |
| Current
Liabilities |
|
|
|
|
Current portion of long-term debt |
$ |
117.4 |
|
|
|
$ |
64.9 |
|
|
|
Accounts payable |
473.7 |
|
|
|
367.9 |
|
|
|
Other current liabilities |
458.1 |
|
|
|
541.6 |
|
|
|
Total Current Liabilities |
1,049.2 |
|
|
|
974.4 |
|
|
| |
|
|
|
| Long-term debt |
6,922.8 |
|
|
|
6,959.0 |
|
|
| Deferred income taxes |
863.9 |
|
|
|
784.5 |
|
|
| Other liabilities |
519.6 |
|
|
|
599.8 |
|
|
|
Total Liabilities |
9,355.5 |
|
|
|
9,317.7 |
|
|
| |
|
|
|
| Redeemable Noncontrolling
Interest |
305.0 |
|
|
|
— |
|
|
| |
|
|
|
| Shareholders’
Equity |
|
|
|
|
Preferred stock |
— |
|
|
|
— |
|
|
|
Common stock |
0.9 |
|
|
|
0.8 |
|
|
|
Additional paid-in capital |
4,253.5 |
|
|
|
4,182.9 |
|
|
|
Retained earnings |
347.3 |
|
|
|
208.6 |
|
|
|
Accumulated other comprehensive income (loss) |
42.9 |
|
|
|
(29.3 |
) |
|
|
Treasury stock, at cost |
(1,902.2 |
) |
|
|
(1,508.5 |
) |
|
|
Total Shareholders’ Equity excluding Noncontrolling
Interest |
2,742.4 |
|
|
|
2,854.5 |
|
|
|
Noncontrolling interests |
11.8 |
|
|
|
(25.5 |
) |
|
|
Total Shareholders’ Equity |
2,754.2 |
|
|
|
2,829.0 |
|
|
|
Total Liabilities and Shareholders’ Equity |
$ |
12,414.7 |
|
|
|
$ |
12,146.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
SELECTED CONDENSED CONSOLIDATED CASH
FLOWS INFORMATION (Unaudited)(in
millions)
| |
Year Ended September 30, |
| |
2021 |
|
2020 |
| Cash provided by (used
in): |
|
|
|
|
Operating activities |
$ |
588.2 |
|
|
|
$ |
625.6 |
|
|
|
Investing activities, including capital expenditures of $192.5 and
$234.6 |
(793.6 |
) |
|
|
(218.5 |
) |
|
|
Financing activities |
(167.5 |
) |
|
|
(272.0 |
) |
|
|
Effect of exchange rate changes on cash, cash equivalents and
restricted cash |
3.7 |
|
|
|
3.8 |
|
|
| Net (decrease)
increase in cash, cash equivalents and restricted
cash |
$ |
(369.2 |
) |
|
|
$ |
138.9 |
|
|
| |
|
|
|
|
|
|
|
|
|
SEGMENT INFORMATION
(Unaudited)(in millions)
| |
Three Months EndedSeptember
30, |
|
Year Ended September 30, |
| |
2021 |
|
2020 |
|
2021 |
|
2020 |
| Net
Sales |
|
|
|
|
|
|
|
|
Post Consumer Brands |
$ |
521.7 |
|
|
|
$ |
471.9 |
|
|
|
$ |
1,915.3 |
|
|
|
$ |
1,949.1 |
|
|
|
Weetabix |
127.2 |
|
|
|
113.7 |
|
|
|
477.5 |
|
|
|
440.4 |
|
|
|
Foodservice |
456.8 |
|
|
|
320.5 |
|
|
|
1,615.6 |
|
|
|
1,361.8 |
|
|
|
Refrigerated Retail |
251.1 |
|
|
|
223.4 |
|
|
|
974.5 |
|
|
|
961.2 |
|
|
|
BellRing Brands |
340.0 |
|
|
|
282.6 |
|
|
|
1,247.1 |
|
|
|
988.3 |
|
|
|
Eliminations |
(1.2 |
) |
|
|
(0.8 |
) |
|
|
(3.3 |
) |
|
|
(2.1 |
) |
|
|
Total |
$ |
1,695.6 |
|
|
|
$ |
1,411.3 |
|
|
|
$ |
6,226.7 |
|
|
|
$ |
5,698.7 |
|
|
| Segment Profit
(Loss) |
|
|
|
|
|
|
|
|
Post Consumer Brands |
$ |
66.5 |
|
|
|
$ |
92.9 |
|
|
|
$ |
316.6 |
|
|
|
$ |
393.5 |
|
|
|
Weetabix |
32.8 |
|
|
|
28.0 |
|
|
|
115.4 |
|
|
|
112.3 |
|
|
|
Foodservice |
14.2 |
|
|
|
(4.9 |
) |
|
|
61.7 |
|
|
|
25.6 |
|
|
|
Refrigerated Retail |
3.7 |
|
|
|
27.1 |
|
|
|
75.9 |
|
|
|
125.6 |
|
|
|
BellRing Brands |
53.1 |
|
|
|
49.0 |
|
|
|
168.0 |
|
|
|
164.0 |
|
|
|
Total segment profit |
170.3 |
|
|
|
192.1 |
|
|
|
737.6 |
|
|
|
821.0 |
|
|
| General corporate expenses and
other |
23.0 |
|
|
|
11.3 |
|
|
|
52.6 |
|
|
|
109.0 |
|
|
| Interest expense, net |
92.5 |
|
|
|
95.3 |
|
|
|
375.8 |
|
|
|
388.6 |
|
|
| Loss on extinguishment and
refinancing of debt, net |
— |
|
|
|
— |
|
|
|
94.8 |
|
|
|
72.9 |
|
|
| (Income) expense on swaps,
net |
(17.2 |
) |
|
|
(5.3 |
) |
|
|
(122.8 |
) |
|
|
187.1 |
|
|
| Earnings before Income
Taxes and Equity Method Loss |
$ |
72.0 |
|
|
|
$ |
90.8 |
|
|
|
$ |
337.2 |
|
|
|
$ |
63.4 |
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL REFRIGERATED RETAIL SEGMENT
INFORMATION (Unaudited)
The below table presents volume percentage changes
for the current quarter compared to the prior year quarter for
products within the Refrigerated Retail segment.
|
Product |
|
Volume Percentage Change |
|
All (1) |
|
9.7% |
|
Side dishes |
|
6.5% |
| Egg
(2) |
|
39.2% |
|
Cheese |
|
(6.0%) |
|
Sausage |
|
(10.4%) |
|
|
|
|
| (1)
Included a 810 basis point benefit from Egg Beaters and
Almark. |
| (2)
Included a 3,450 basis point benefit from Egg Beaters and
Almark. |
|
|
EXPLANATION AND RECONCILIATION OF
NON-GAAP MEASURES
Post uses certain non-GAAP measures in this release to
supplement the financial measures prepared in accordance with U.S.
generally accepted accounting principles (“GAAP”). These non-GAAP
measures include total segment profit, Adjusted net earnings,
Adjusted diluted earnings per common share, Adjusted EBITDA and
segment Adjusted EBITDA. The reconciliation of each of these
non-GAAP measures to the most directly comparable GAAP measure is
provided in the tables following this section. Non-GAAP measures
are not prepared in accordance with GAAP, as they exclude certain
items as described below. These non-GAAP measures may not be
comparable to similarly titled measures of other companies.
Total segment profitTotal segment profit represents the
aggregation of the segment profit for each of Post’s reportable
segments, which for all segments excluding BellRing Brands is each
segment’s earnings/loss before income taxes and equity method
earnings/loss before impairment of property, goodwill and other
intangible assets, facility closure related costs, restructuring
expenses, gain/loss on assets and liabilities held for sale,
gain/loss on sale of businesses and facilities, gain on/adjustment
to bargain purchase, interest expense and other unallocated
corporate income and expenses. Segment profit for BellRing Brands,
as it is a publicly-traded company, is its operating profit. Post
believes total segment profit is useful to investors in evaluating
Post’s operating performance because it facilitates
period-to-period comparison of results of segment operations.
Adjusted net earnings and Adjusted diluted earnings per common
sharePost believes Adjusted net earnings and Adjusted diluted
earnings per common share are useful to investors in evaluating
Post’s operating performance because they exclude items that affect
the comparability of Post’s financial results and could potentially
distort an understanding of the trends in business performance.
Adjusted net earnings and Adjusted diluted earnings per common
share are adjusted for the following items:
- Income/expense on swaps, net: Post has excluded the impact of
mark-to-market adjustments on interest rate swaps due to the
inherent uncertainty and volatility associated with such amounts
based on changes in assumptions with respect to estimates of fair
value and economic conditions and as the amount and frequency of
such adjustments are not consistent.
- Payments of debt premiums and refinancing fees: Post has
excluded payments and other expenses for premiums on debt
extinguishment, net of gains realized on debt repurchased at a
discount, and refinancing fees as such payments are inconsistent in
amount and frequency. Additionally, Post believes that these costs
do not reflect expected ongoing future operating expenses and do
not contribute to a meaningful evaluation of Post’s current
operating performance or comparisons of Post’s operating
performance to other periods.
- Mark-to-market adjustments on commodity and foreign exchange
hedges and warrant liabilities: Post has excluded the impact of
mark-to-market adjustments on commodity and foreign exchange hedges
and warrant liabilities due to the inherent uncertainty and
volatility associated with such amounts based on changes in
assumptions with respect to fair value estimates. Additionally,
these adjustments are primarily non-cash items and the amount and
frequency of such adjustments are not consistent.
- Accelerated amortization: Post has excluded non-cash
accelerated amortization charges recorded in connection with
discontinuance of certain brands as the amount and frequency of
such charges are not consistent. Additionally, Post believes that
these charges do not reflect expected ongoing future operating
expenses and do not contribute to a meaningful evaluation of Post’s
current operating performance or comparisons of Post’s operating
performance to other periods.
- Gain on/adjustment to bargain purchase: Post has excluded gains
recorded for acquisitions in which the fair value of the assets
acquired exceeded the purchase price and adjustments to such gains
as such amounts are inconsistent in amount and frequency. Post
believes such gains and adjustments are generally not relevant to
assessing or estimating the long-term performance of acquired
assets as part of Post, and such amounts are not factored into the
performance of acquisitions after their completion.
- Provision for legal settlements: Post has excluded gains and
losses recorded to recognize the anticipated or actual resolution
of certain litigation as Post believes such gains and losses do not
reflect expected ongoing future operating income and expenses and
do not contribute to a meaningful evaluation of Post’s current
operating performance or comparisons of Post’s operating
performance to other periods.
- Mark-to-market adjustments on equity securities: Post has
excluded the impact of mark-to-market adjustments on investments in
equity securities due to the inherent volatility associated with
such amounts based on changes in market pricing variations and as
the amount and frequency of such adjustments are not consistent.
Additionally, these adjustments are primarily non-cash items and do
not contribute to a meaningful evaluation of Post’s current
operating performance or comparisons of Post’s operating
performance to other periods.
- Asset disposal costs: Post has excluded costs recorded in
connection with the disposal of certain assets which were never put
into use as the amount and frequency of adjustments costs are not
consistent. Additionally, Post believes that these costs do not
reflect expected ongoing future operating expenses and do not
contribute to a meaningful evaluation of Post’s current operating
performance or comparisons of Post’s operating performance to other
periods.
- Restructuring and facility closure costs, including accelerated
depreciation: Post has excluded certain costs associated with
facility closures as the amount and frequency of such adjustments
are not consistent. Additionally, Post believes that these costs do
not reflect expected ongoing future operating expenses and do not
contribute to a meaningful evaluation of Post’s current operating
performance or comparisons of Post’s operating performance to other
periods.
- Transaction costs and integration costs: Post has excluded
transaction costs related to professional service fees and other
related costs associated with signed and closed business
combinations and divestitures, costs associated with setting up a
special purpose acquisition company and integration costs incurred
to integrate acquired or to-be-acquired businesses as Post believes
that these exclusions allow for more meaningful evaluation of
Post’s current operating performance and comparisons of Post’s
operating performance to other periods. Post believes such costs
are generally not relevant to assessing or estimating the long-term
performance of acquired assets as part of Post or the performance
of the divested assets, and such costs are not factored into
management’s evaluation of potential acquisitions or Post’s
performance after completion of an acquisition or the evaluation to
divest an asset or set up a special purpose acquisition entity. In
addition, the frequency and amount of such charges varies
significantly based on the size and timing of the transaction and
the maturity of the businesses being acquired or divested. Also,
the size, complexity and/or volume of past transactions, which
often drive the magnitude of such expenses, may not be indicative
of the size, complexity and/or volume of future transactions. By
excluding these expenses, management is better able to evaluate
Post’s ability to utilize its existing assets and estimate the
long-term value that acquired assets will generate for Post.
Furthermore, Post believes that the adjustments of these items more
closely correlate with the sustainability of Post’s operating
performance. Post also has excluded certain expenses incurred (i)
to effect BellRing’s separation from Post, (ii) in connection with
Post’s plan to distribute Post’s interest in BellRing and (iii) to
support BellRing’s transition into a separate stand-alone,
publicly-traded entity, as the amount and frequency of such
expenses are not consistent. Additionally, Post believes that these
separation costs do not reflect expected ongoing future operating
expenses and do not contribute to a meaningful evaluation of Post’s
or the BellRing Brands segment’s current operating performances or
comparisons of Post’s or the BellRing Brands segment’s operating
performances to other periods.
- Inventory revaluation adjustment on acquired business: Post has
excluded the impact of fair value step-up adjustments to inventory
in connection with business combinations as such adjustments
represent non-cash items, are not consistent in amount and
frequency and are significantly impacted by the timing and size of
Post’s acquisitions.
- Assets held for sale: Post has excluded adjustments recorded to
adjust the carrying value of facilities and other assets classified
as held for sale as such adjustments represent non-cash items and
the amount and frequency of such adjustments are not consistent.
Additionally, Post believes that these adjustments do not reflect
expected ongoing future operating expenses or income and do not
contribute to a meaningful evaluation of Post’s current operating
performance or comparisons of Post’s operating performance to other
periods.
- Advisory income: Post has excluded advisory income received
from 8th Avenue as Post believes such income does not contribute to
a meaningful evaluation of Post’s current operating performance or
comparisons of Post’s operating performance to other periods.
- Foreign currency gain/loss on intercompany loans: Post has
excluded the impact of foreign currency fluctuations related to
intercompany loans denominated in currencies other than the
functional currency of the respective legal entity in evaluating
Post’s performance to allow for more meaningful comparisons of
performance to other periods.
- Noncontrolling interest adjustment: Post has included an
adjustment to reflect the removal of the portion of the non-GAAP
adjustments related to BellRing and PHPC which are attributable to
noncontrolling interest in the calculation of Adjusted net earnings
and Adjusted diluted net earnings per common share.
- Income tax effect on adjustments: Post has included the income
tax impact of the non-GAAP adjustments using a rate described in
the applicable footnote of the reconciliation tables, as Post
believes that its GAAP effective income tax rate as reported is not
representative of the income tax expense impact of the
adjustments.
- U.K. tax reform expense: Post has excluded the impact of the
income tax expense recorded in the fourth quarter of 2020 which
reflected the remeasurement of Post’s U.K. deferred tax assets and
liabilities considering a 19% U.K. corporate income tax rate for
future periods and the third and fourth quarters of 2021 which
reflected the remeasurement of Post’s U.K. deferred tax assets and
liabilities considering a 25% U.K. corporate income tax rate for
future periods. Post believes that the expense as reported is not
representative of Post’s current income tax position and exclusion
of the expense allows for more meaningful comparisons of
performance to other periods.Adjusted EBITDA and segment Adjusted
EBITDAPost believes that Adjusted EBITDA is useful to investors in
evaluating Post’s operating performance and liquidity because (i)
Post believes it is widely used to measure a company’s operating
performance without regard to items such as depreciation and
amortization, which can vary depending upon accounting methods and
the book value of assets, (ii) it presents a measure of corporate
performance exclusive of Post’s and BellRing’s capital structure
and the method by which the assets were acquired and (iii) it is a
financial indicator of a company’s ability to service its debt, as
Post and BellRing LLC are required to comply with certain covenants
and limitations that are based on variations of EBITDA in their
respective financing documents. Post believes that segment Adjusted
EBITDA is useful to investors in evaluating Post’s operating
performance because it allows for assessment of the operating
performance of each reportable segment. Management uses Adjusted
EBITDA to provide forward-looking guidance and uses Adjusted EBITDA
and segment Adjusted EBITDA to forecast future results.Adjusted
EBITDA and segment Adjusted EBITDA reflect adjustments for income
tax expense/benefit, interest expense, net and depreciation and
amortization including accelerated depreciation and amortization,
and the following adjustments discussed above: income/expense on
swaps, net, mark-to-market adjustments on commodity and foreign
exchange hedges and warrant liabilities, gain on/adjustment to
bargain purchase, provision for legal settlements, mark-to-market
adjustments on equity securities, asset disposal costs,
restructuring and facility closure costs excluding accelerated
depreciation, transaction costs and integration costs, inventory
revaluation adjustment on acquired business, assets held for sale,
advisory income and foreign currency gain/loss on intercompany
loans. Additionally, Adjusted EBITDA and segment Adjusted EBITDA
reflect adjustments for the following items:
- Gain/loss on extinguishment and refinancing of debt, net: Post
has excluded gains and losses recorded on extinguishment and
refinancing of debt, inclusive of payments for premiums, the
write-off of debt issuance and deferred financing costs and the
write-off of net unamortized debt premiums and discounts, net of
gains realized on debt repurchased at a discount, as such gains and
losses are inconsistent in amount and frequency. Additionally, Post
believes that these gains and losses do not reflect expected
ongoing future operating income and expenses and do not contribute
to a meaningful evaluation of Post’s current operating performance
or comparisons of Post’s operating performance to other
periods.
- Non-cash stock-based compensation: Post’s and BellRing’s
compensation strategies include the use of stock-based compensation
to attract and retain executives and employees by aligning their
long-term compensation interests with shareholders’ and
stockholders’ investment interests, respectively. After the
BellRing initial public offering, BellRing continues to be charged
for Post stock-based compensation through the master services
agreement with Post. BellRing’s director compensation strategy
includes an election by any director who earns retainers in which
the director may elect to defer compensation granted as a director
to BellRing Class A common stock, earning a match on the deferral,
both of which are stock-settled upon the director’s retirement from
the BellRing board of directors. Post has excluded non-cash
stock-based compensation as non-cash stock-based compensation can
vary significantly based on reasons such as the timing, size and
nature of the awards granted and subjective assumptions which are
unrelated to operational decisions and performance in any
particular period and does not contribute to meaningful comparisons
of Post’s and BellRing’s operating performances to other
periods.
- Noncontrolling interest adjustment: Post has included
adjustments for (i) the portion of BellRing’s and PHPC’s
consolidated net earnings/loss which was allocated to
noncontrolling interest, resulting in Adjusted EBITDA including
100% of the consolidated Adjusted EBITDA of the BellRing Brands and
PHPC businesses, as Post believes this basis contributes to a more
meaningful evaluation of the consolidated operating company
performance and (ii) income tax expense/benefit, interest expense,
net and depreciation and amortization for Post’s consolidated
Weetabix investment which is attributable to the noncontrolling
owners of the consolidated Weetabix investment.
- Equity method investment adjustment: Post has included
adjustments for the 8th Avenue equity investment loss and Post’s
portion of income tax expense/benefit, interest expense, net and
depreciation and amortization for its unconsolidated Weetabix
investment accounted for using equity method accounting.
- Adjustment to tax receivable agreement (“TRA”) liability: Post
has excluded adjustments to BellRing’s TRA liability with Post as
the amount and frequency of such adjustments are not consistent.
Additionally, Post believes that these adjustments do not
contribute to a meaningful evaluation of Post’s current operating
performance or comparisons of Post’s operating performance to other
periods. These adjustments also eliminate in consolidations at
Post.
RECONCILIATION OF NET EARNINGS AVAILABLE
TO COMMON SHAREHOLDERSTO ADJUSTED NET EARNINGS
(Unaudited)(in millions)
| |
Three Months EndedSeptember
30, |
|
Year Ended September 30, |
| |
2021 |
|
2020 |
|
2021 |
|
2020 |
|
Net Earnings Available to Common Shareholders |
$ |
29.9 |
|
|
|
$ |
57.0 |
|
|
|
$ |
166.7 |
|
|
|
$ |
0.8 |
|
|
| Dilutive impact of
BellRing net earnings |
(0.1 |
) |
|
|
— |
|
|
|
(0.1 |
) |
|
|
— |
|
|
| |
|
|
|
|
|
|
|
|
Adjustments: |
|
|
|
|
|
|
|
|
(Income) expense on swaps, net |
(17.2 |
) |
|
|
(5.3 |
) |
|
|
(122.8 |
) |
|
|
187.1 |
|
|
|
Payments of debt premiums and refinancing fees |
— |
|
|
|
— |
|
|
|
75.9 |
|
|
|
49.8 |
|
|
|
Mark-to-market adjustments on commodity and foreign exchange hedges
and warrant liabilities |
(7.5 |
) |
|
|
(7.6 |
) |
|
|
(54.4 |
) |
|
|
6.3 |
|
|
|
Accelerated amortization |
— |
|
|
|
— |
|
|
|
29.9 |
|
|
|
— |
|
|
|
Adjustment to/gain on bargain purchase |
1.2 |
|
|
|
(11.7 |
) |
|
|
(11.4 |
) |
|
|
(11.7 |
) |
|
|
Provision for legal settlements |
— |
|
|
|
— |
|
|
|
15.0 |
|
|
|
0.6 |
|
|
|
Mark-to-market adjustments on equity securities |
2.7 |
|
|
|
1.4 |
|
|
|
(9.6 |
) |
|
|
1.4 |
|
|
|
Asset disposal costs |
6.0 |
|
|
|
— |
|
|
|
6.0 |
|
|
|
— |
|
|
|
Restructuring and facility closure costs, including accelerated
depreciation |
— |
|
|
|
0.3 |
|
|
|
5.9 |
|
|
|
2.3 |
|
|
|
Transaction costs |
1.9 |
|
|
|
0.1 |
|
|
|
6.0 |
|
|
|
5.5 |
|
|
|
Integration costs |
2.5 |
|
|
|
0.9 |
|
|
|
4.1 |
|
|
|
3.5 |
|
|
|
Inventory revaluation adjustment on acquired business |
1.6 |
|
|
|
0.4 |
|
|
|
3.4 |
|
|
|
0.4 |
|
|
|
Assets held for sale |
— |
|
|
|
2.7 |
|
|
|
(0.5 |
) |
|
|
2.7 |
|
|
|
Advisory income |
(0.2 |
) |
|
|
(0.2 |
) |
|
|
(0.6 |
) |
|
|
(0.6 |
) |
|
|
Foreign currency loss (gain) on intercompany loans |
0.2 |
|
|
|
(0.3 |
) |
|
|
0.1 |
|
|
|
(0.5 |
) |
|
|
Noncontrolling interest adjustment |
6.3 |
|
|
|
0.1 |
|
|
|
(5.5 |
) |
|
|
(0.1 |
) |
|
|
Total Net Adjustments |
(2.5 |
) |
|
|
(19.2 |
) |
|
|
(58.5 |
) |
|
|
246.7 |
|
|
| Income tax effect
on adjustments (1) |
0.4 |
|
|
|
1.7 |
|
|
|
7.9 |
|
|
|
(57.7 |
) |
|
| U.K. tax reform
expense |
0.7 |
|
|
|
13.0 |
|
|
|
40.0 |
|
|
|
13.0 |
|
|
| Adjusted
Net Earnings |
$ |
28.4 |
|
|
|
$ |
52.5 |
|
|
|
$ |
156.0 |
|
|
|
$ |
202.8 |
|
|
| |
|
|
|
|
|
|
|
| (1) For all
periods, income tax effect on adjustments was calculated on all
items, except income/expense on swaps and adjustment to/gain on
bargain purchase, using a rate of 24.5%, the sum of Post’s U.S.
federal corporate income tax rate plus Post’s blended state income
tax rate, net of federal income tax benefit. Income tax effect for
income/expense on swaps, net was calculated using a rate of 21.5%.
Adjustment to/gain on bargain purchase was calculated using a rate
of 0.0%. |
| |
RECONCILIATION OF DILUTED EARNINGS PER
COMMON SHARETO ADJUSTED DILUTED EARNINGS PER
COMMON SHARE (Unaudited)
| |
Three Months EndedSeptember
30, |
|
Year Ended September 30, |
| |
2021 |
|
2020 |
|
2021 |
|
2020 |
|
Diluted Earnings per Common Share |
$ |
0.39 |
|
|
|
$ |
0.83 |
|
|
|
$ |
2.38 |
|
|
|
$ |
0.01 |
|
|
| Adjustment to Basic and
Diluted Earnings per Common Share for accretion of redeemable NCI
(1) |
0.07 |
|
|
|
— |
|
|
|
0.17 |
|
|
|
— |
|
|
| |
|
|
|
|
|
|
|
|
Adjustments: |
|
|
|
|
|
|
|
|
(Income) expense on swaps, net |
(0.27 |
) |
|
|
(0.07 |
) |
|
|
(1.88 |
) |
|
|
2.67 |
|
|
|
Payments of debt premiums and refinancing fees |
— |
|
|
|
— |
|
|
|
1.16 |
|
|
|
0.71 |
|
|
|
Mark-to-market adjustments on commodity and foreign exchange hedges
and warrant liabilities |
(0.11 |
) |
|
|
(0.11 |
) |
|
|
(0.83 |
) |
|
|
0.09 |
|
|
|
Accelerated amortization |
— |
|
|
|
— |
|
|
|
0.46 |
|
|
|
— |
|
|
|
Adjustment to/gain on bargain purchase |
0.02 |
|
|
|
(0.17 |
) |
|
|
(0.17 |
) |
|
|
(0.17 |
) |
|
|
Provision for legal settlements |
— |
|
|
|
— |
|
|
|
0.23 |
|
|
|
0.01 |
|
|
|
Mark-to-market adjustments on equity securities |
0.04 |
|
|
|
0.02 |
|
|
|
(0.14 |
) |
|
|
0.02 |
|
|
|
Asset disposal costs |
0.09 |
|
|
|
— |
|
|
|
0.09 |
|
|
|
— |
|
|
|
Restructuring and facility closure costs, including accelerated
depreciation |
— |
|
|
|
— |
|
|
|
0.09 |
|
|
|
0.03 |
|
|
|
Transaction costs |
0.03 |
|
|
|
— |
|
|
|
0.09 |
|
|
|
0.08 |
|
|
|
Integration costs |
0.04 |
|
|
|
0.01 |
|
|
|
0.06 |
|
|
|
0.05 |
|
|
|
Inventory revaluation adjustment on acquired business |
0.02 |
|
|
|
0.01 |
|
|
|
0.05 |
|
|
|
0.01 |
|
|
|
Assets held for sale |
— |
|
|
|
0.04 |
|
|
|
(0.01 |
) |
|
|
0.04 |
|
|
|
Advisory income |
— |
|
|
|
— |
|
|
|
(0.01 |
) |
|
|
(0.01 |
) |
|
|
Foreign currency loss (gain) on intercompany loans |
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.01 |
) |
|
|
Noncontrolling interest adjustment |
0.10 |
|
|
|
— |
|
|
|
(0.08 |
) |
|
|
— |
|
|
|
Total Net Adjustments |
(0.04 |
) |
|
|
(0.27 |
) |
|
|
(0.89 |
) |
|
|
3.52 |
|
|
| Income tax effect on
adjustments (2) |
0.01 |
|
|
|
0.02 |
|
|
|
0.12 |
|
|
|
(0.82 |
) |
|
| U.K. tax reform expense |
0.01 |
|
|
|
0.19 |
|
|
|
0.61 |
|
|
|
0.18 |
|
|
| Adjusted Diluted
Earnings per Common Share |
$ |
0.44 |
|
|
|
$ |
0.77 |
|
|
|
$ |
2.39 |
|
|
|
$ |
2.89 |
|
|
| |
|
|
|
|
|
|
|
| (1) Represents
the exclusion of the portion of the PHPC deemed dividend (which
represents remeasurements to the redemption value of the redeemable
NCI) that exceeded fair value which was treated as a reduction to
income available to common shareholders for basic and diluted
earnings per share. Post believes this exclusion allows for more
meaningful comparison of performance to other periods. |
| (2) For all
periods, income tax effect on adjustments was calculated on all
items, except income/expense on swaps, net and adjustment to/gain
on bargain purchase, using a rate of 24.5%, the sum of Post’s U.S.
federal corporate income tax rate plus Post’s blended state income
tax rate, net of federal income tax benefit. Income tax effect for
income/expense on swaps, net was calculated using a rate of 21.5%.
Adjustment to/gain on bargain purchase was calculated using a rate
of 0.0%. |
| |
RECONCILIATION OF NET EARNINGS TO
ADJUSTED EBITDA (Unaudited)(in
millions)
| |
Three Months EndedSeptember
30, |
|
Year Ended September 30, |
| |
2021 |
|
2020 |
|
2021 |
|
2020 |
|
Net Earnings |
$ |
29.9 |
|
|
|
$ |
57.0 |
|
|
|
$ |
166.7 |
|
|
|
$ |
0.8 |
|
|
| Income tax expense |
5.4 |
|
|
|
15.2 |
|
|
|
86.6 |
|
|
|
3.5 |
|
|
| Interest expense, net |
92.5 |
|
|
|
95.3 |
|
|
|
375.8 |
|
|
|
388.6 |
|
|
| Depreciation and amortization,
including accelerated depreciation and amortization |
103.3 |
|
|
|
95.8 |
|
|
|
420.2 |
|
|
|
370.3 |
|
|
| (Income) expense on swaps,
net |
(17.2 |
) |
|
|
(5.3 |
) |
|
|
(122.8 |
) |
|
|
187.1 |
|
|
| Loss on extinguishment and
refinancing of debt, net |
— |
|
|
|
— |
|
|
|
94.8 |
|
|
|
72.9 |
|
|
| Non-cash stock-based
compensation |
14.0 |
|
|
|
12.5 |
|
|
|
56.0 |
|
|
|
49.8 |
|
|
| Noncontrolling interest
adjustment |
18.8 |
|
|
|
9.8 |
|
|
|
38.2 |
|
|
|
26.4 |
|
|
| Equity method investment
adjustment |
17.4 |
|
|
|
8.5 |
|
|
|
44.1 |
|
|
|
31.1 |
|
|
| Mark-to-market adjustments on
commodity and foreign exchange hedges and warrant liabilities |
(7.5 |
) |
|
|
(7.6 |
) |
|
|
(54.4 |
) |
|
|
6.3 |
|
|
| Adjustment to/gain on bargain
purchase |
1.2 |
|
|
|
(11.7 |
) |
|
|
(11.4 |
) |
|
|
(11.7 |
) |
|
| Provision for legal
settlements |
— |
|
|
|
— |
|
|
|
15.0 |
|
|
|
0.6 |
|
|
| Mark-to-market adjustments on
equity securities |
2.7 |
|
|
|
1.4 |
|
|
|
(9.6 |
) |
|
|
1.4 |
|
|
| Asset disposal costs |
6.0 |
|
|
|
— |
|
|
|
6.0 |
|
|
|
— |
|
|
| Restructuring and facility
closure costs, excluding accelerated depreciation |
— |
|
|
|
0.3 |
|
|
|
5.6 |
|
|
|
2.4 |
|
|
| Transaction costs |
1.9 |
|
|
|
0.1 |
|
|
|
6.0 |
|
|
|
5.5 |
|
|
| Integration costs |
2.5 |
|
|
|
0.9 |
|
|
|
4.1 |
|
|
|
3.5 |
|
|
| Inventory revaluation
adjustment on acquired business |
1.6 |
|
|
|
0.4 |
|
|
|
3.4 |
|
|
|
0.4 |
|
|
| Assets held for sale |
— |
|
|
|
2.7 |
|
|
|
(0.5 |
) |
|
|
2.7 |
|
|
| Advisory income |
(0.2 |
) |
|
|
(0.2 |
) |
|
|
(0.6 |
) |
|
|
(0.6 |
) |
|
| Foreign currency loss (gain)
on intercompany loans |
0.2 |
|
|
|
(0.3 |
) |
|
|
0.1 |
|
|
|
(0.5 |
) |
|
| Adjusted
EBITDA |
$ |
272.5 |
|
|
|
$ |
274.8 |
|
|
|
$ |
1,123.3 |
|
|
|
$ |
1,140.5 |
|
|
| Adjusted EBITDA as a
percentage of Net Sales |
16.1 |
|
% |
|
19.5 |
|
% |
|
18.0 |
|
% |
|
20.0 |
|
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF SEGMENT PROFIT TO
ADJUSTED EBITDA (Unaudited)THREE MONTHS ENDED
SEPTEMBER 30, 2021(in millions)
|
|
PostConsumerBrands |
|
Weetabix |
|
Foodservice |
|
RefrigeratedRetail |
|
BellRingBrands |
|
Corporate/Other |
|
Total |
| Segment
Profit |
$ |
66.5 |
|
|
$ |
32.8 |
|
|
$ |
14.2 |
|
|
$ |
3.7 |
|
|
53.1 |
|
|
$ |
— |
|
|
$ |
170.3 |
|
| General corporate expenses and
other |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(23.0 |
) |
|
(23.0 |
) |
| Other income, net |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(9.5 |
) |
|
(9.5 |
) |
| Operating
Profit |
66.5 |
|
|
32.8 |
|
|
14.2 |
|
|
3.7 |
|
|
53.1 |
|
|
(32.5 |
) |
|
137.8 |
|
| Other income, net |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
9.5 |
|
|
9.5 |
|
| Depreciation and amortization,
including accelerated depreciation and amortization |
34.6 |
|
|
10.4 |
|
|
31.7 |
|
|
20.3 |
|
|
5.4 |
|
|
0.9 |
|
|
103.3 |
|
| Non-cash stock-based
compensation |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1.9 |
|
|
12.1 |
|
|
14.0 |
|
| Noncontrolling interest
adjustment |
— |
|
|
(0.5 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(0.5 |
) |
| Mark-to-market adjustments on
commodity and foreign exchange hedges and warrant liabilities |
— |
|
|
— |
|
|
3.7 |
|
|
— |
|
|
(0.2 |
) |
|
(11.0 |
) |
|
(7.5 |
) |
| Adjustment to bargain
purchase |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1.2 |
|
|
1.2 |
|
| Mark-to-market adjustments on
equity securities |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
2.7 |
|
|
2.7 |
|
| Asset disposal costs |
— |
|
|
— |
|
|
6.0 |
|
|
— |
|
|
— |
|
|
— |
|
|
6.0 |
|
| Restructuring and facility
closure costs, excluding accelerated depreciation |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(0.1 |
) |
|
0.1 |
|
|
— |
|
| Transaction costs |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
0.2 |
|
|
1.7 |
|
|
1.9 |
|
| Integration costs |
2.5 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
2.5 |
|
| Inventory revaluation
adjustment on acquired business |
1.6 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1.6 |
|
| Advisory income |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(0.2 |
) |
|
(0.2 |
) |
| Foreign currency loss on
intercompany loans |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
0.2 |
|
|
— |
|
|
0.2 |
|
|
Adjusted EBITDA |
$ |
105.2 |
|
|
$ |
42.7 |
|
|
$ |
55.6 |
|
|
$ |
24.0 |
|
|
$ |
60.5 |
|
|
$ |
(15.5 |
) |
|
$ |
272.5 |
|
| Adjusted EBITDA as a
percentage of Net Sales |
20.2 |
% |
|
33.6 |
% |
|
12.2 |
% |
|
9.6 |
% |
|
17.8 |
% |
|
— |
|
|
16.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF SEGMENT PROFIT (LOSS)
TO ADJUSTED EBITDA (Unaudited)THREE MONTHS ENDED
SEPTEMBER 30, 2020(in millions)
| |
PostConsumerBrands |
|
Weetabix |
|
Foodservice |
|
RefrigeratedRetail |
|
BellRingBrands |
|
Corporate/Other |
|
Total |
|
Segment Profit (Loss) |
$ |
92.9 |
|
|
$ |
28.0 |
|
|
$ |
(4.9 |
) |
|
$ |
27.1 |
|
|
$ |
49.0 |
|
|
$ |
— |
|
|
$ |
192.1 |
|
| General corporate expenses and
other |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(11.3 |
) |
|
(11.3 |
) |
| Other income, net |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(1.9 |
) |
|
(1.9 |
) |
| Operating Profit
(Loss) |
92.9 |
|
|
28.0 |
|
|
(4.9 |
) |
|
27.1 |
|
|
49.0 |
|
|
(13.2 |
) |
|
178.9 |
|
| Other income, net |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1.9 |
|
|
1.9 |
|
| Depreciation and
amortization |
28.2 |
|
|
10.2 |
|
|
31.3 |
|
|
18.7 |
|
|
6.3 |
|
|
1.1 |
|
|
95.8 |
|
| Non-cash stock-based
compensation |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1.7 |
|
|
10.8 |
|
|
12.5 |
|
| Noncontrolling interest
adjustment |
— |
|
|
(0.5 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(0.5 |
) |
| Equity method investment
adjustment |
— |
|
|
0.2 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
0.2 |
|
| Mark-to-market adjustments on
commodity and foreign exchange hedges |
— |
|
|
— |
|
|
(3.4 |
) |
|
— |
|
|
— |
|
|
(4.2 |
) |
|
(7.6 |
) |
| Gain on bargain purchase |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(11.7 |
) |
|
(11.7 |
) |
| Mark-to-market adjustments on
equity securities |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1.4 |
|
|
1.4 |
|
| Restructuring and facility
closure costs |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
0.3 |
|
|
0.3 |
|
| Transaction costs |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
0.1 |
|
|
0.1 |
|
| Integration costs |
0.2 |
|
|
— |
|
|
0.3 |
|
|
0.4 |
|
|
— |
|
|
— |
|
|
0.9 |
|
| Inventory revaluation
adjustment on acquired business |
— |
|
|
— |
|
|
0.4 |
|
|
— |
|
|
— |
|
|
— |
|
|
0.4 |
|
| Assets held for sale |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
2.7 |
|
|
2.7 |
|
| Advisory income |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(0.2 |
) |
|
(0.2 |
) |
| Foreign currency gain on
intercompany loans |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(0.3 |
) |
|
— |
|
|
(0.3 |
) |
| Adjusted
EBITDA |
$ |
121.3 |
|
|
$ |
37.9 |
|
|
$ |
23.7 |
|
|
$ |
46.2 |
|
|
$ |
56.7 |
|
|
$ |
(11.0 |
) |
|
$ |
274.8 |
|
| Adjusted EBITDA as a
percentage of Net Sales |
25.7 |
% |
|
33.3 |
% |
|
7.4 |
% |
|
20.7 |
% |
|
20.1 |
% |
|
— |
|
|
19.5 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF SEGMENT PROFIT TO
ADJUSTED EBITDA (Unaudited)YEAR ENDED SEPTEMBER
30, 2021(in millions)
| |
PostConsumerBrands |
|
Weetabix |
|
Foodservice |
|
RefrigeratedRetail |
|
BellRingBrands |
|
Corporate/Other |
|
Total |
|
Segment Profit |
$ |
316.6 |
|
|
$ |
115.4 |
|
|
$ |
61.7 |
|
|
$ |
75.9 |
|
|
$ |
168.0 |
|
|
$ |
— |
|
|
$ |
737.6 |
|
| General corporate expenses and
other |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(52.6 |
) |
|
(52.6 |
) |
| Other income, net |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(29.3 |
) |
|
(29.3 |
) |
| Operating
Profit |
316.6 |
|
|
115.4 |
|
|
61.7 |
|
|
75.9 |
|
|
168.0 |
|
|
(81.9 |
) |
|
655.7 |
|
| Other income, net |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
29.3 |
|
|
29.3 |
|
| Depreciation and amortization,
including accelerated depreciation and amortization |
122.0 |
|
|
39.0 |
|
|
126.0 |
|
|
75.5 |
|
|
53.7 |
|
|
4.0 |
|
|
420.2 |
|
| Non-cash stock-based
compensation |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
7.3 |
|
|
48.7 |
|
|
56.0 |
|
| Noncontrolling interest
adjustment |
— |
|
|
(1.8 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(1.8 |
) |
| Equity method investment
adjustment |
— |
|
|
0.2 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
0.2 |
|
| Mark-to-market adjustments on
commodity and foreign exchange hedges and warrant liabilities |
— |
|
|
— |
|
|
3.0 |
|
|
— |
|
|
(0.2 |
) |
|
(57.2 |
) |
|
(54.4 |
) |
| Gain on bargain purchase |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(11.4 |
) |
|
(11.4 |
) |
| Provision for legal
settlements |
15.0 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
15.0 |
|
| Mark-to-market adjustments on
equity securities |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(9.6 |
) |
|
(9.6 |
) |
| Asset disposal costs |
— |
|
|
— |
|
|
6.0 |
|
|
— |
|
|
— |
|
|
— |
|
|
6.0 |
|
| Restructuring and facility
closure costs, excluding accelerated depreciation |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
5.2 |
|
|
0.4 |
|
|
5.6 |
|
| Transaction costs |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
0.2 |
|
|
5.8 |
|
|
6.0 |
|
| Integration costs |
3.8 |
|
|
— |
|
|
0.3 |
|
|
— |
|
|
— |
|
|
— |
|
|
4.1 |
|
| Inventory revaluation
adjustment on acquired business |
3.1 |
|
|
— |
|
|
— |
|
|
0.3 |
|
|
— |
|
|
— |
|
|
3.4 |
|
| Assets held for sale |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(0.5 |
) |
|
(0.5 |
) |
| Adjustment to TRA
liability |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(0.4 |
) |
|
0.4 |
|
|
— |
|
| Advisory income |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(0.6 |
) |
|
(0.6 |
) |
| Foreign currency loss on
intercompany loans |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
0.1 |
|
|
— |
|
|
0.1 |
|
| Adjusted
EBITDA |
$ |
460.5 |
|
|
$ |
152.8 |
|
|
$ |
197.0 |
|
|
$ |
151.7 |
|
|
$ |
233.9 |
|
|
$ |
(72.6 |
) |
|
$ |
1,123.3 |
|
| Adjusted EBITDA as a
percentage of Net Sales |
24.0 |
% |
|
32.0 |
% |
|
12.2 |
% |
|
15.6 |
% |
|
18.8 |
% |
|
— |
|
|
18.0 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF SEGMENT PROFIT TO
ADJUSTED EBITDA (Unaudited)YEAR ENDED SEPTEMBER
30, 2020(in millions)
| |
PostConsumerBrands |
|
Weetabix |
|
Foodservice |
|
RefrigeratedRetail |
|
BellRingBrands |
|
Corporate/Other |
|
Total |
|
Segment Profit |
$ |
393.5 |
|
|
$ |
112.3 |
|
|
$ |
25.6 |
|
|
$ |
125.6 |
|
|
$ |
164.0 |
|
|
$ |
— |
|
|
$ |
821.0 |
|
| General corporate expenses and
other |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(109.0 |
) |
|
(109.0 |
) |
| Other income, net |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(11.5 |
) |
|
(11.5 |
) |
| Operating
Profit |
393.5 |
|
|
112.3 |
|
|
25.6 |
|
|
125.6 |
|
|
164.0 |
|
|
(120.5 |
) |
|
700.5 |
|
| Other income, net |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
11.5 |
|
|
11.5 |
|
| Depreciation and amortization,
including accelerated depreciation |
112.4 |
|
|
35.9 |
|
|
119.6 |
|
|
73.1 |
|
|
25.3 |
|
|
4.0 |
|
|
370.3 |
|
| Non-cash stock-based
compensation |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
6.5 |
|
|
43.3 |
|
|
49.8 |
|
| Noncontrolling interest
adjustment |
— |
|
|
(1.8 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(1.8 |
) |
| Equity method investment
adjustment |
— |
|
|
0.2 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
0.2 |
|
| Mark-to-market adjustments on
commodity and foreign exchange hedges |
— |
|
|
— |
|
|
(1.9 |
) |
|
— |
|
|
— |
|
|
8.2 |
|
|
6.3 |
|
| Gain on bargain purchase |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(11.7 |
) |
|
(11.7 |
) |
| Provision for legal
settlements |
— |
|
|
— |
|
|
— |
|
|
0.6 |
|
|
— |
|
|
— |
|
|
0.6 |
|
| Mark-to-market adjustments on
equity securities |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1.4 |
|
|
1.4 |
|
| Restructuring and facility
closure costs |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
2.4 |
|
|
2.4 |
|
| Transaction costs |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1.9 |
|
|
3.6 |
|
|
5.5 |
|
| Integration costs |
2.0 |
|
|
— |
|
|
0.3 |
|
|
1.2 |
|
|
— |
|
|
— |
|
|
3.5 |
|
| Inventory revaluation
adjustment on acquired business |
— |
|
|
— |
|
|
0.4 |
|
|
— |
|
|
— |
|
|
— |
|
|
0.4 |
|
| Assets held for sale |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
2.7 |
|
|
2.7 |
|
| Advisory income |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(0.6 |
) |
|
(0.6 |
) |
| Foreign currency gain on
intercompany loans |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(0.5 |
) |
|
— |
|
|
(0.5 |
) |
| Adjusted
EBITDA |
$ |
507.9 |
|
|
$ |
146.6 |
|
|
$ |
144.0 |
|
|
$ |
200.5 |
|
|
$ |
197.2 |
|
|
$ |
(55.7 |
) |
|
$ |
1,140.5 |
|
| Adjusted EBITDA as a
percentage of Net Sales |
26.1 |
% |
|
33.3 |
% |
|
10.6 |
% |
|
20.9 |
% |
|
20.0 |
% |
|
— |
|
|
20.0 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SELECTED FINANCIAL INFORMATION FOR 8TH
AVENUE (Unaudited)(in millions)
| |
Three Months EndedSeptember
30, |
|
Year Ended September 30, |
| |
2021 |
|
2020 |
|
2021 |
|
2020 |
|
Net Sales |
$ |
236.3 |
|
|
|
$ |
229.0 |
|
|
|
$ |
900.8 |
|
|
|
$ |
924.2 |
|
|
| Gross Profit |
$ |
31.1 |
|
|
|
$ |
35.4 |
|
|
|
$ |
132.3 |
|
|
|
$ |
160.0 |
|
|
| |
|
|
|
|
|
|
|
| Net Loss |
$ |
(16.1 |
) |
|
|
$ |
(2.2 |
) |
|
|
$ |
(24.3 |
) |
|
|
$ |
(6.4 |
) |
|
| Less: Preferred Stock
Dividend |
9.5 |
|
|
|
8.5 |
|
|
|
36.3 |
|
|
|
32.5 |
|
|
| Net Loss Available to 8th
Avenue Common Shareholders |
$ |
(25.6 |
) |
|
|
$ |
(10.7 |
) |
|
|
$ |
(60.6 |
) |
|
|
$ |
(38.9 |
) |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EXPLANATION AND RECONCILIATION OF 8TH
AVENUE’S NON-GAAP MEASURE
Post believes that Adjusted EBITDA is useful to investors in
evaluating 8th Avenue’s operating performance and liquidity because
(i) Post believes it is widely used to measure a company’s
operating performance without regard to items such as depreciation
and amortization, which can vary depending upon accounting methods
and the book value of assets, (ii) it presents a measure of
corporate performance exclusive of 8th Avenue’s capital structure
and the method by which the assets were acquired and (iii) it is a
financial indicator of a company’s ability to service its debt.
Management has historically used 8th Avenue’s Adjusted EBITDA to
provide forward-looking guidance and to forecast future
results.
8th Avenue’s Adjusted EBITDA reflects adjustments for interest
expense, net, income tax expense/benefit and depreciation and
amortization including accelerated depreciation, and the following
adjustments:
- Transaction, integration and sale-leaseback costs: Post has
excluded transaction costs related to professional service fees and
other related costs associated with (i) signed business
combinations, (ii) a sale-leaseback transaction and (iii)
integration costs incurred to integrate the component business
units that comprise the combined 8th Avenue organization. Post
believes that these exclusions allow for more meaningful evaluation
of 8th Avenue’s current operating performance and comparisons of
8th Avenue’s operating performance to other periods. Post believes
such costs are generally not relevant to assessing or estimating
the long-term performance of 8th Avenue’s assets or acquired assets
as part of 8th Avenue, and such costs are not factored into 8th
Avenue management’s evaluation of its performance, its evaluation
of potential acquisitions or its performance after completion of an
acquisition. In addition, the frequency and amount of such charges
varies significantly based on the size and timing of the
acquisitions and the maturity of the businesses being acquired.
Also, the size, complexity and/or volume of past acquisitions,
which often drive the magnitude of such expenses, may not be
indicative of the size, complexity and/or volume of future
acquisitions. By excluding these expenses, 8th Avenue management is
better able to evaluate 8th Avenue’s ability to utilize its
existing assets and estimate the long-term value that its assets
will generate for 8th Avenue. Furthermore, Post believes that the
adjustments of these items more closely correlate with the
sustainability of 8th Avenue’s operating performance.
- Adjustment to/gain on bargain purchase: Post has excluded gains
recorded for acquisitions in which the fair value of the assets
acquired exceeded the purchase price and adjustments to such gains
as such amounts are inconsistent in amount and frequency. Post
believes such gains and adjustments are generally not relevant to
assessing or estimating the long-term performance of acquired
assets as part of 8th Avenue, and such amounts are not factored
into the performance of acquisitions after their completion.
- Non-cash stock-based compensation: 8th Avenue’s compensation
strategy includes the use of stock-based compensation to attract
and retain executives and employees by aligning their long-term
compensation interests with shareholders’ investment interests.
Post has excluded non-cash stock-based compensation as non-cash
stock-based compensation can vary significantly based on reasons
such as the timing, size and nature of the awards granted and
subjective assumptions which are unrelated to operational decisions
and performance in any particular period and do not contribute to
meaningful comparisons of 8th Avenue’s operating performance to
other periods.
- Facility relocation costs: Post has excluded certain costs
associated with facility relocations as the amount and frequency of
such costs are not consistent. Additionally, Post believes that
these costs do not reflect expected ongoing future operating
expenses and do not contribute to a meaningful evaluation of 8th
Avenue’s current operating performance or comparisons of 8th
Avenue’s operating performance to other periods.
- Inventory revaluation adjustment on acquired business: Post has
excluded the impact of fair value step-up adjustments to inventory
in connection with business combinations as such adjustments
represent non-cash items, are not consistent in amount and
frequency and are significantly impacted by the timing and size of
8th Avenue’s acquisitions.
- Advisory costs: Post has excluded advisory costs payable by 8th
Avenue to Post and a third party as Post believes such costs do not
contribute to a meaningful evaluation of 8th Avenue’s current
operating performance or comparisons of 8th Avenue’s operating
performance to other periods.
- Assets held for sale: Post has excluded adjustments recorded to
adjust the carrying value of facilities and other assets classified
as held for sale as such adjustments represent non-cash items and
the amount and frequency of such adjustments are not consistent.
Additionally, Post believes that these adjustments do not reflect
expected ongoing future operating expenses or income and do not
contribute to a meaningful evaluation of 8th Avenue’s current
operating performance or comparisons of 8th Avenue’s operating
performance to other periods.
RECONCILIATION OF 8TH AVENUE’S NET LOSS
TO 8TH AVENUE’S ADJUSTED EBITDA (Unaudited)(in
millions)
| |
Three Months EndedSeptember
30, |
|
Year Ended September 30, |
| |
2021 |
|
2020 |
|
2021 |
|
2020 |
|
Net Loss |
$ |
(16.1 |
) |
|
|
$ |
(2.2 |
) |
|
|
$ |
(24.3 |
) |
|
|
$ |
(6.4 |
) |
|
| Interest expense, net |
10.8 |
|
|
|
9.6 |
|
|
|
37.3 |
|
|
|
47.5 |
|
|
| Income tax benefit |
(0.6 |
) |
|
|
(3.1 |
) |
|
|
(6.7 |
) |
|
|
(3.0 |
) |
|
| Depreciation and amortization,
including accelerated depreciation |
15.9 |
|
|
|
16.4 |
|
|
|
58.9 |
|
|
|
54.3 |
|
|
| Integration costs |
0.3 |
|
|
|
1.0 |
|
|
|
3.0 |
|
|
|
1.9 |
|
|
| Adjustment to/gain on bargain
purchase |
— |
|
|
|
0.3 |
|
|
|
— |
|
|
|
(3.1 |
) |
|
| Non-cash stock-based
compensation |
0.2 |
|
|
|
0.1 |
|
|
|
0.7 |
|
|
|
0.2 |
|
|
| Transaction costs |
0.4 |
|
|
|
0.1 |
|
|
|
1.5 |
|
|
|
0.5 |
|
|
| Facility relocation costs |
2.0 |
|
|
|
— |
|
|
|
2.0 |
|
|
|
— |
|
|
| Inventory revaluation
adjustment on acquired business |
1.7 |
|
|
|
— |
|
|
|
1.7 |
|
|
|
— |
|
|
| Sale-leaseback costs |
— |
|
|
|
— |
|
|
|
— |
|
|
|
0.7 |
|
|
| Advisory costs |
0.3 |
|
|
|
0.4 |
|
|
|
1.2 |
|
|
|
1.6 |
|
|
| Assets held for sale |
(0.1 |
) |
|
|
— |
|
|
|
(0.1 |
) |
|
|
— |
|
|
| Adjusted
EBITDA |
$ |
14.8 |
|
|
|
$ |
22.6 |
|
|
|
$ |
75.2 |
|
|
|
$ |
94.2 |
|
|
| Adjusted EBITDA as a
percentage of Net Sales |
6.3 |
|
% |
|
9.9 |
|
% |
|
8.3 |
|
% |
|
10.2 |
|
% |
Post (LSE:0KJZ)
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