Whole Earth Brands Q4 Earnings Miss Estimates

  • Whole Earth Brands Inc FREE reported fourth-quarter FY21 consolidated product revenue growth of 75.3% year-on-year, to $132.71 million, missing the consensus of $138.56 million.
  • On a proforma basis, organic product revenue was flat compared to last year.
  • Product revenues from Branded CPG segment increased 98.1%, and the Flavors & Ingredients segment rose 21.2%.
  • The gross profit increased 53.6% Y/Y to $38.7 million with a gross profit margin of 29.2% versus 33.3% last year.
  • The operating margin was 4.8%, and operating income for the quarter of $6.4 million.
  • The company held $28.3 million in cash and equivalents as of December 31, 2021.
  • EPS loss of $(0.01) missed the analyst consensus of $0.20.
  • Adjusted EBITDA increased 47% Y/Y to $20.6 million.
  • "Heading into 2022, we expect our recent pricing actions and productivity improvements will offset current inflationary pressures," said CEO Albert Manzone.
  • Outlook: Whole Earth Brands sees FY22 net product revenues of $530 million - $545 million versus the consensus of $545.12 million. It expects an adjusted EBITDA of $84 million - $87 million.
  • Price Action: FREE shares closed lower by 3.65% at $8.71 on Friday.
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