Pet-food maker Freshpet cuts sales, earnings guidance
Freshpet has revised its full-year 2025 outlook and now expects net sales growth of 15% to 18% down from its earlier projection of 21% to 24%.
The Nasdaq-listed pet food company expects total net sales to be between $1.12bn and $1.15bn, compared to its previous estimate of $1.18bn to $1.21bn.
Freshpet also revised its adjusted EBITDA guidance to between $190m and $210m, from a prior minimum of $210m.
The new guidance comes as the Freshpet reported a net loss of $12.7m for the first quarter of fiscal year 2025, compared to a net income of $18.6m in the same period last year.
Capital expenditures are forecast at approximately $225m, down from the earlier projection of around $250m.
Freshpet CEO Billy Cyr said: 'Despite the recent macro-economic headwinds, we believe Freshpet remains a structurally advantaged business with a long runway for growth in a category with long-term tailwinds.
'However, our growth year-to-date has not been as robust as we had anticipated so we are adapting our growth plans to the current economic challenges that our consumers are facing while continuing to drive the operational improvements that are essential to our long-term success.
'Looking ahead, we believe it is prudent to adjust our 2025 outlook and plan as if the conditions we saw in the first quarter were to continue for the balance of the year. In doing so, we believe we are positioning Freshpet to weather the near-term economic headwinds and deliver long-term shareholder value while serving pets, people and the planet.'
For the three months ended 31 March, Freshpet reported net sales of $263.2m, a 17.6% increase compared to the year ago period.
Gross profit rose to $103.8m from $88.2m, with gross margin remaining steady at 39.4%. Adjusted gross profit was $120.2m, or 45.7% of net sales, up from $101.5m, or 45.3%.
Selling, general and administrative (SG&A) expenses surged to $115.3m, up from $79.7m, largely due to increased media spend, higher share-based compensation, and one-time charges, the company said in its statement.
In February, Freshpet reported that it turned a full-year 2024 net profit for the first time and raised its longer-term margin targets following a 'strong' annual sales performance.
The pet-food maker exceeded its sales growth target in the 12 months ended 31 December with a 27.2% increase to $975.2m, above the 27% yearly goal it planned to reach by 2027.
In what CEO Billy Cyr described as a 'breakout year' for Freshpet in fiscal 2024, the New Jersey-based business posted net income of $46.9m, a sharp turnaround from a $33.6m loss a year earlier.
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