Why Food Processing Firm TreeHouse Foods Stocks Are Diving Today

TreeHouse Foods Inc. THS shares are trading lower on Tuesday after the company reported its first-quarter FY25 earnings.

The company reported a first-quarter FY25 revenue decline of 3% year-on-year to $796 million, beating the analyst consensus estimate of $790.42 million.

The net sales decrease was primarily due to unfavorable volume/mix related to planned margin management actions, broader macroeconomic consumption trends, and service impacts related to the voluntary recall of frozen griddle products. 

Also Read: Food Service Provider Aramark Posts 2% Revenue Growth In Q2

Gross margin for the quarter expanded 90 basis points Y/Y to 14.5%. Adjusted EBITDA from continuing operations totaled $57.5 million, and the margin was 1.8%.

The company reported an operating loss of $(5.5) million compared to a loss of $(5.2) million last year. Operating expenses climbed 3% year over year to $120.7 million.

Adjusted EPS of $0.03 beat the consensus estimate of $(0.19). TreeHouse held $16.4 million in cash and equivalents as of March-end.

Outlook: TreeHouse reaffirmed its FY25 sales outlook of $3.34 billion—$3.40 billion, up from an estimate of $3.36 billion. The company expects FY25 adjusted EBITDA of $345 million—$375 million and capital expenditures of $125 million.

TreeHouse anticipates second-quarter sales of $785 million -$800 million versus an estimated $785.69 million.

Price Action: THS shares traded lower by 5.18% at $22.24 at last check Tuesday.

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