Simply Good Foods Company Surpasses Expectations with Strong First Quarter 2025 Performance
The Simply Good Foods Company has kicked off its fiscal year 2025 on a high note, reporting impressive sales growth and reaffirming its full-year outlook. The company's recent conference call provided insights into its first quarter performance, highlighting the strength of its brands and the nutritional snacking category as a whole.
In a prepared statement, Geoff Tanner, President and CEO, noted that the company is pleased with its fiscal first-quarter retail takeaway of about 8%, driven by strong growth in Quest's sales. Despite some chip stockouts early in the quarter, Quest's momentum continued, while OWYN also experienced positive results. Net sales increased 10.6% overall, with the inclusion of OWYN.
Quest, one of the pioneers in the mainstreaming of high-protein, low-sugar, and low-carb foods, has seen its salty snacks business grow significantly since the acquisition. With a broad range of products catering to these nutritional profiles, Quest is well-positioned for sustained growth, according to Tanner.
The company's gross margin also exceeded expectations at 38.2%, leading to adjusted EBITDA growth of 13.1%. This performance demonstrates the strength of Simply Good Foods' business model and its ability to drive shareholder value.
Shaun Mara, CFO, further discussed the financial results in his portion of the call, highlighting the positive trends and the company's optimism about the future. The acquisition of Only What You Need (OWYN) has been a significant contributor to Simply Good Foods' growth, and its inclusion in fiscal year 2025 is expected to be in line with the company's long-term algorithm.
The nutritional snacking category as a whole showed impressive momentum in the first quarter, growing around 12% due to increased demand for high-protein, low-sugar, and low-carb food and beverage options. All major subsegments of the category, including bars, shakes, and chips, experienced growth.
Simply Good Foods believes it is well-positioned to drive sustained growth and increased shareholder value with its three uniquely positioned brands aligned against consumer megatrends. The company remains optimistic about its prospects for the future, reaffirming its full-year outlook and anticipating net sales growth in the 4% to 6% range and adjusted EBITDA growth slightly greater than the net sales increase.
