Vending

Hostess Brands reports 14.4% quarterly net sales gain

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May 12, 2020

Hostess Brands Inc. reported net revenue was $243.5 million, an increase of 14.4% excluding the sale of the in-store bakery business for the three months ended March 31, 2020, according to a press release.

The results were driven by the acquisition of Voortman Cookies Limited contributing $17.1 million, or 8.1% of the growth and the sweet baked goods business adding $13.5 million, or 6.3% in growth, primarily driven by higher volume of core Hostess branded products.

Gross profit was $79.3 million, an increase of 8.5%, excluding in-store bakery, due to higher sales volume. Adjusted gross profit was $84.3 million, a 12.8% increase, excluding in-store bakery.

Net income was $2.6 million, or $0.02 per diluted share, compared to $26.6 million, or $0.21 per diluted share, in the prior period. The decline was primarily due to transaction, integration and other facility transition costs. Adjusted net income decreased $2.1 million, or 10.3%, to $18.6 million, resulting in $0.14 adjusted EPS consistent with the prior period. The decline in adjusted net income was primarily due to higher costs as a result of the Voortman acquisition in addition to less income due to the sale of in-store bakery.