B&G Foods, Inc. (NYSE: BGS) Q2 2025 Earnings | 08/05/2025

17 days ago

46:21

Inside Ticker

Earnings Calls

AI Summary

Summary of B&G Foods Q2 2025 Earnings Call

Key Financial Highlights:

Net Sales: $424.4M (down 4.5% YoY), with base business down 4.2%.
Adjusted EBITDA: $58M (down 9.3% YoY), impacted by higher costs in frozen/vegetables.
Adjusted EPS: $0.04 (vs. $0.08 in Q2 2024).
Cash Flow: Strong improvement—$70.6M YTD operating cash flow (vs. $46.4M in 2024).
Net Debt: Reduced to $1.957B (pro forma ~$1.9B post-Le Sueur divestiture).

Business Unit Performance:

Frozen & Vegetables: EBITDA down $6.5M YoY due to crop costs and trade spend timing (expected to reverse in H2).
Specialty (Crisco, etc.): Sales down 8% (lower soybean oil pricing), but EBITDA up 3%.
Meals: Sales down 3.5%, but EBITDA up 7.7% (strong Cream of Wheat recovery).
Spices & Flavor Solutions: Hit by tariffs ($1.6M impact), particularly on garlic/black pepper.

Divestitures & Portfolio Reshaping:

Completed Sales:
- Don Pepino & Sclafani (May 2025): ~$14M annual sales.
- Le Sueur U.S. canned peas (Aug 2025): ~$36M annual sales.
Proceeds: ~$59M (Le Sueur), used for debt reduction.
Future Targets: Additional divestitures (e.g., Green Giant U.S. frozen/Canadian business) to focus on higher-margin brands and reduce leverage.

2025 Outlook & Guidance:

Revised Guidance:
- Net Sales: $1.83B–$1.88B (vs. prior $1.85B–$1.90B).
- Adjusted EBITDA: $273M–$283M.
- EPS: $0.50–$0.60.
H2 Expectations:
- Flat to slightly positive sales (helped by 53rd week in Q4).
- EBITDA growth from cost savings ($10M in H2, $15–20M annual run rate).
- Frozen vegetables rebound (+$8–10M EBITDA vs. 2024).
Leverage Goal: Reduce to <6x within 12 months (from ~7x today).

Tariffs & Pricing Actions:

Primary Impact: Spices (garlic, black pepper) and steel cans.
Mitigation:
- Targeted price increases (lagging due to retailer negotiations).
- Alternative sourcing (limited for China-dependent ingredients).
- Expect full recovery by 2026.

Q&A Highlights:

Sales Trends: Improving sequentially (July/August ~-2% vs. Q2’s -4.2%).
Divestiture Strategy: Focus on non-core, seasonal businesses; Green Giant U.S./Canada next.
Trade Spend: Elevated in H1 (Easter timing), but moderating in H2.

Final Takeaways:

Priorities: Stabilize sales, optimize portfolio, reduce debt.
Catalysts: Further divestitures, tariff mitigation, and frozen veg recovery.
Long-Term Goal: 20% EBITDA margins, leverage ~5x, and strategic M&A.

Next Steps: Monitor Green Giant divestiture progress and H2 margin execution.

About this video

B&G Foods, Inc. reported its Q2 2025 results, reflecting continued portfolio restructuring and persistent headwinds in sales and profitability. Net sales fell 4.5% year-over-year to $424.4 million, missing analyst expectations, as volume and net pricing both dropped and challenges in the specialty and frozen foods categories persisted. Base business net sales also declined 4.2%. Gross profit for the quarter was $87.0 million (20.5% gross margin), and adjusted gross profit was $89.1 million (21.0% margin), both modestly down from Q2 2024. The company posted a net loss of $9.8 million, or $0.12 per diluted share, compared to net income of $3.9 million, or $0.05 per diluted share, in the prior year, largely due to a $12.6 million loss on the divestiture of its Don Pepino and Sclafani brands. Adjusted net income was $2.9 million, or $0.04 per diluted share, down from $6.6 million and $0.08 per share a year ago. Adjusted EBITDA decreased 9.3% to $58.0 million, with margin dropping to 13.7%. Despite these financial pressures, net cash from operations improved to $17.8 million, up from $11.3 million in Q2 2024. Management highlighted improvements in trend versus Q1 and signaled further sequential gains in H2 2025, with U.S. frozen vegetables expected to reach profitability. Ongoing divestitures and brand realignment were underscored as critical steps to streamlining and improving cash flow and margins, while net debt reduction remains a key focus. Guidance for full-year 2025 was revised downward with expected net sales between $1.83–$1.88 billion, adjusted EBITDA of $273–$283 million, and adjusted EPS of $0.50–$0.60, reflecting continued market and operational pressures. About Inside Ticker: For more expert analysis and real-time updates on B&G Foods, Inc. (NYSE: BGS) and other market movers, follow Inside Ticker and visit InsideTicker.com for in-depth reports, financial insights, and the latest news on leading companies. #BGFoods #BGS #Q22025 #Earnings #FinancialResults #NetLoss #Revenue #AdjustedEBITDA #GrossMargin #CashFlow #Divestitures #Portfolio #Crisco #GreenGiant #Guidance #PackagedFoods #ConsumerGoods #DebtReduction #InsideTicker #2025Outlook #NASDAQ #SpecialtyFoods #Profitability #Restructuring #FrozenFoods #InvestorUpdate

Important Note: The stock market is inherently unpredictable, and forecasts are subject to change based on various factors, including economic conditions and company performance. Always consult multiple sources and consider professional advice before making investment decisions.

AI-Powered Financial Analysis This analysis uses real-time market data. While we strive for accuracy, always verify important financial information and consult with qualified financial professionals before making investment decisions. Past performance does not guarantee future results.