Vending

Hostess Brands reports Q1 2021 revenue gain, earnings dip

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May 17, 2021

Hostess Brands Inc. net revenue rose 8% from $243.5 million in Q1 2020 to $265.4 million for the quarter ending March 31, 2021, driven primarily by the strong performance of Hostess and Voortman branded products, according to an earnings release.

Net income fell from $81.74 million to $26.7 million in the comparative period, while basic earnings per share fell from 66 cents to 20 cents and diluted EPS rose from 2 cents to 19 cents.

Adjusted net income increased 44.6%, to $26.9 million primarily due to higher sales volume, favorable mix and realization of Voortman synergies.

The $265.4 million in revenue beat analyst expectations by $7.65 million and the non-GAAP EPS of 20 cents beat expectations by 1 cent and the GAAP EPS of 19 cents met analyst expectations, according to Seeking Alpha.

Shares traded at $15.50 today against a 52-week range of $11.35-$16.18.

"We had an excellent start to 2021 with strong net revenue and earnings growth across both sweet baked goods and Voortman on top of strong growth in the prior year comparable period," President and CEO Andy Callahan said in the release. "Our brands' strength drove impressive point-of-sale growth, leading to all-time high market share across several channels.

"We continue to experience elevated at-home consumption, while at the same time, increased on-the-go snacking and consumer mobility are benefiting our profitable single-serve mix. Continued strong execution on productivity and pricing measures gives us the confidence to manage inflation and leaves us optimistic for the remainder of 2021."

The company expects adjusted net revenue growth of 3% to 4.5% for 2021, with adjusted EPS rising 6.7%-13.3% over S1 2020 to 80 cents to 85 cents.