Adapted from a press release:
Freshpet’s net sales and gross profit margin both increased for the dog food company in the first quarter of this year ended March 31, compared to the same quarter in 2023. What’s more, the company went from a net loss last year to net income.
- Net sales increased - Net sales increased 33.6% to US$223.8 million for the first quarter of 2024 compared to US$167.5 million for the prior year period. The increase in net sales was primarily driven by volume gains of 30.6%.
- Gross profit margin rose - Gross profit was US$88.2 million, or 39.4% as a percentage of net sales, for the first quarter of 2024, compared to US$50.8 million, or 30.3% as a percentage of net sales, for the prior year period. The increase in reported gross profit as a percentage of net sales was primarily due to improved leverage on plant expenses, reduced quality costs, and lower input cost as a percentage of sales.
- Higher adjusted gross margin - For the first quarter of 2024, Adjusted Gross Profit was US$101.5 million, or 45.3% as a percentage of net sales, compared to US$64.4 million, or 38.5% as a percentage of net sales, for the prior year period.
- Net income, compared to the prior year period net loss - Net income was US$18.6 million for the first quarter of 2024 compared to net loss of US$24.8 million for the prior year period. The improvement in net income was due to contribution from higher sales, improved gross margin, reduced logistics costs as a percentage of net sales, and gain on equity investment of US$9.9 million, partially offset by increased SG&A including increased media spend of US$6.1 million.
- Adjusted EBITDA of US$30.6 million, compared to the prior year period of US$3.0 million.
"Our strong first quarter results provide solid evidence that we can deliver our long-term financial goals– and we are now determined to prove that we can achieve this level of performance consistently over time,” Billy Cyr, Freshpet’s chief executive officer, said in a press release. “The strength of the Freshpet business model and consumer proposition continue to drive the robust net sales growth investors have come to expect from us, and our intense focus on operational improvements is delivering the margin expansion we knew we could achieve with additional scale. While we are very bullish on our prospects for continued profit improvement, our focus now is on delivering consistently strong performance. If we continue to do well, we will create significant shareholder value while fulfilling our mission to nourish pets, people and the planet."
About Freshpet
Freshpet is a U.S.-based manufacturer of fresh, refrigerated dog treats and food for dogs and cats, according to Petfood Industry’s Top Companies Current Data. The company says all of its meat is 100% farm-raised. In 2022, the company's sales grew by 39.9%, and the company is investing in increased manufacturing capacity for further growth. Freshpet’s annual revenue in 2022 reached US$595,300,000.
