Post Holdings, Inc. POST reported second-quarter fiscal 2025 results, with the top line missing the Zacks Consensus Estimate but the bottom line exceeding the same. However, both metrics declined year over year.

Post Holdings’ Q2 Metrics in Detail

The company posted adjusted earnings of $1.41 per share, surpassing the Zacks Consensus Estimate of $1.18. However, the bottom line decreased from the adjusted earnings of $1.51 recorded in the year-ago quarter. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

Post Holdings, Inc. Price, Consensus and EPS SurprisePost Holdings, Inc. Price, Consensus and EPS Surprise

Post Holdings, Inc. price-consensus-eps-surprise-chart | Post Holdings, Inc. Quote

Net sales reached $1,952.1 million, marking a 2.3% decrease year over year, which includes $2.3 million from acquisitions. When excluding the acquisition impact, net sales growth in Foodservice was counterbalanced by declines in Post Consumer Brands, Refrigerated Retail and Weetabix. The top line missed the Zacks Consensus Estimate of $1,977 million.

The gross profit of $545.8 million decreased 5.8% year over year, while the gross margin contracted to 28% from 29%.

Selling, general and administrative expenses decreased 7.8% to $314.8 million. As a percentage of net sales, the metric was 16.1% compared with 17.1% reported in the year-ago period.

The operating profit registered a decrease of 4.2% to $182.2 million. The adjusted EBITDA was $346.5 million, an increase of 0.4% from $345.2 million in the year-ago quarter.

Decoding Post Holdings’ Segmental Performance

Post Consumer Brands: The segment reported net sales of $987.9 million, down 7.3% year over year. The figure also missed our estimate of $1,019 million. This decline was due to a 5.8% drop in volumes. Cereal volumes fell 6.3%, reflecting overall category softness. Pet food volumes declined 5.4%, caused by reduced private label and co-manufactured products, as well as distribution losses, partially offset by changes in customer inventory levels. The segment’s profit dropped 0.1% to $139.6 million, with adjusted EBITDA rising 2.4% to $203.8 million.

Weetabix: The segment registered a 4.6% decline in net sales to $131.7 million and missed our estimate of $133 million. This included a foreign currency headwind of approximately 70 basis points. Volumes declined 7.1%, primarily due to the strategic exit of low-performing products, reduced promotional activity and cereal category declines. The segment's profit increased 0.6% to $18.2 million, with adjusted EBITDA rising 9% to $30.3 million.

Foodservice: The segment recorded 9.6% growth in net sales to $607.9 million, which also surpassed our estimate of $585 million. Volumes grew 2.8%, driven by the addition of ready-to-drink shakes, partially offset by declines in egg and potato products. The segment’s profit decreased 4.7% to $61.5 million, with adjusted EBITDA down 5.6% to $96 million.

Refrigerated Retail: The segment sales dipped 6.6% year over year, amounting to $224.6 million and missed our estimate of $238 million. Volumes dropped 4.9%, primarily due to the shifting of holiday timing in the current and prior-year periods. The segmental profit fell 27.7% to $16.2 million, while adjusted EBITDA dropped 14.3% to $34.7 million.

Story Continues

Other Financial Aspects of POST

Post Holdings ended the quarter with cash and cash equivalents of $617.6 million, long-term debt of $6,944.6 million and total shareholders’ equity of $3,841.4 million.

In the second quarter of fiscal 2025, Post Holdings repurchased 1.7 million shares of its common stock for $191.6 million. For the six months ended March 31, 2025, it repurchased a total of 3.3 million shares for $372.7 million. From the end of the second quarter through May 7, 2025, the company repurchased an additional 0.2 million shares for $17.4 million. As of May 7, $397.9 million remained available under the existing share repurchase authorization.

What to Expect From POST in FY25?

Post Holdings has updated its guidance for fiscal 2025 adjusted EBITDA, now expecting a range of $1,430-$1,470 million, up from the previous band of $1,420-$1,460 million.

In addition, the company expects fiscal 2025 capital expenditures to be between $390 million and $430 million. This includes investments of $100-$110 million by Post Consumer Brands for network optimization, announced plant closures, and pet food safety and capacity enhancements. It also includes $80-$90 million in Foodservice investments, primarily for completing the Norwalk, Iowa precooked egg facility expansion and continuing the expansion of cage-free egg facilities.

This Zacks Rank #3 (Hold) company’s shares have increased 0.9% compared with the industry’s growth of 0.5% in the past three months.Zacks Investment Research

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