BRBR - BellRing Brands knocks out beat-and-raise quarter

2023-08-09 09:45:45 ET

BellRing Brands ( NYSE: BRBR ) moved lower in early trading on Wednesday, despite topping estimates on both lines of its FQ3 earnings report and hiking full-year revenue and adjusted EBITDA guidance.

Sales were up 20.3% during the quarter to $445.9M, driven by 11.0% improvement in price/mix and 9.3% increase in volume. Sales in the Premier Protein segment increased 19.9%, driven by 10.2% improvement in price/mix and 9.7% increase in volume. Sales in the Dymatize segment increased 32.3%, driven by 46.4% increase in volume, which was partially offset by 14.1% decrease in price/mix. Sales in the segment benefited from volume growth driven by distribution gains and organic growth and lapping prior year period temporary price elasticities.

Gross profit came in at 30.5% of sales vs. 32.4% of sales a year ago. Gross profit included unfavorable mark-to-market adjustments on commodity hedges of $1.9M and $0.7M in the third quarter of 2023 and 2022, respectively, which were treated as adjustments for non-GAAP measures. The global nutrition company noted that the lower gross profit margin was driven by input cost inflation and higher promotional activity, which was only partially offset by pricing actions and favorable freight rates.

Mizuho analyst John Baumgartner said that while the FQ3 EPS tally from BellRing Brands ( BRBR ) was solid, the multi-year outlook was even better. The firm kept BRBR locked in as a top pick in the food sector on its view that the growth story is only beginning

Shares of BellRing Brands ( BRBR ) dropped 1.65% in early trading on Wednesday.

More on BellRing Brands:

• BellRing Brands earnings call transcript
• Growth metrics on BellRing Brands
• Valuation metrics on BellRing Brands
• Seeking Alpha's Quant Rating for BellRing Brands

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