Flowers Foods reports record Q1 2023 sales, boosted by pricing

Flowers Foods Inc., which owns Mrs. Freshleys, Tastykake, Natures Own and other brands, posted record Q1 sales for Q1 2023 boosted by pricing while income declined, according to a press release. Highlights include:

• Sales increased 6.9% from $1.44 billion in Q1 2022 to $1.53 billion in the quarter ending April 22, 2023, a first quarter record. Pricing/mix increased 13.6%, volume declined 7.3% and the Papa Pita acquisition added 0.6%.
• Net income decreased 17.4% from $85.6 million to $70.7 million in the comparative quarters.
• Adjusted net income decreased 13.1% to $80.9 million.
• Net income per diluted common share fell from 40 cents to 33 cents.
• Adjusted diluted EPS decreased by 6 cents to 38 cents.
• Branded retail sales increased 2.5% to $979.3 million due to higher prices intended to offset inflationary pressures and improved promotional efficiency, partially offset by volume declines and increased product returns.
• Other sales increased 15.6% to $555.1 million due to higher prices intended to offset inflationary pressures, partially offset by volume declines largely due to exiting lower margin business and targeted sales rationalization in foodservice, cake and private label.

Shares traded today at $25.89 against a 52-week range of $24.15-$30.16.

The $1.53 billion in quarterly revenue missed analyst expectations by $20 million while the non-GAAP EPS of 38 cents was in line with expectations, according to Seeking Alpha.

"Our first quarter results reflect the competitive strength of our leading brands and their ability to meet shifting consumer demand in a challenging environment," Ryals McMullian, president and CEO, said in the press release. "Price increases to offset inflationary pressures drove record sales, while our product mix continued to return to more normalized levels as consumers dined out of the home more frequently. Private label category sales remained strong, although the growth rate is moderating."