DENVER, April 09, 2026 (GLOBE NEWSWIRE) -- The Simply Good Foods Company (Nasdaq: SMPL) ("Simply Good Foods," or the "Company"), a leader in the Nutritional Snacking Category, today reported financial results for the thirteen and twenty-six weeks ended February 28, 2026.
Second Quarter Summary:(1)
-- Net sales of $326.0 million versus $359.7 million
-- Net loss of $159.7 million versus net income of $36.7 million
-- Loss per diluted share of $1.73 versus earnings per diluted share of
$0.36
-- Adjusted Diluted EPS(2) of $0.45 versus $0.46
-- Adjusted EBITDA(3) of $55.5 million versus $68.0 million
Updating Fiscal Year 2026(4) Outlook:
-- Net sales expected to range between $1.31 and $1.35 billion, or -10% to
-7% year-over-year
-- Gross margins expected to decline between 300 and 350 basis points
year-over-year
-- Adjusted EBITDA expected to range between $217 and $225 million, or -22%
to -19% year-over-year
"I want to make it quite clear that we are not satisfied with our current performance," said Joe Scalzo, President and Chief Executive Officer of Simply Good Foods. "Our recent results have not met our expectations, and we have taken immediate and fundamental actions to turnaround both our financial performance and our in-market performance."
Scalzo continued, "The long-term fundamentals of our category, our portfolio and our company capabilities are compelling, but in the near-term our organization must focus on three priorities, which are strengthening our business model economics by improving our cost structure and margins, ensuring consistency in our strategic choices driving organizational clarity and efficiency, and rebuilding brand investment behind superior marketing execution to drive household penetration."
Second Quarter 2026 Results
Net sales of $326.0 million decreased 9.4% versus the comparable year ago period, driven by declines for Atkins and OWYN of 26.6% and 16.8%, respectively, and only partially offset by Quest growth of 0.3%. The Company's net sales performance was largely driven by poor retail takeaway relative to what we experienced in the first quarter. Quarter over quarter Quest consumption was affected by slower base velocity in chips and bars. OWYN consumption declined year over year due to lapping the heavy promotional period in the prior year and poor base velocities, including on newly expanded distribution.
Total Simply Good Foods retail takeaway(5) decreased about 6.4% driven by a growth for Quest of 2.4% and a decline for OWYN of 2.4%, while Atkins declined 23.4%, which was largely as expected for the brand.
Gross profit of $103.0 million decreased 20.8% versus the comparable year ago period, driven by inflationary costs, most notably cocoa, and tariffs. Gross margin was 31.6%, a decline of 460 basis points versus prior year, largely reflecting higher input costs and some one-time effects from actions taken to mitigate OWYN product quality issues. Excluding $3.9 million of one-time OWYN integration expenses in the current year period and a $0.4 million non-cash inventory purchase accounting step-up adjustment expense related to the OWYN acquisition that occurred in the comparable prior year period, gross margin was 32.8%, a 350 basis point decline versus the comparable year ago period.
Selling and marketing expenses of $28.2 million decreased 19.7% versus the comparable year ago period driven by planned declines for Atkins, which more than offset increases to support growth for Quest and OWYN.
General and administrative ("G&A") expenses of $34.9 million decreased 3.2% versus the comparable year ago period. Excluding for the current period $4.5 million in restructuring costs, integration expenses of $0.8 million, and term loan transaction fees of $0.2 million and for the prior year period integration expenses of $2.0 million and term loan transaction fees of $0.7 million, G&A declined 12.0% to $29.3 million.
As part of the Company's process to evaluate the carrying value of our brands, we recognized an aggregate $249.0 million non-cash, impairment charge related to the Atkins brand and OWYN brand intangible assets. The impairment is largely the result of a challenging fiscal year 2026 and updated projections of future revenue.
Net interest expense of $5.0 million reflected a 12.1% decrease versus the comparable year ago period due to lower interest rates.
The effective tax rate was 26.8%.
Net loss of $159.7 million compared to net income of $36.7 million for the comparable year ago period.
Adjusted EBITDA of $55.5 million decreased 18.4% versus the comparable year ago period.
Reported loss per diluted share was $1.73 versus reported earnings per diluted share of $0.36 in the comparable year ago period.
Adjusted diluted EPS was $0.45 versus $0.46 in the comparable year ago period.
Weighted average diluted shares outstanding of 92.3 million declined modestly versus the comparable year ago period, reflecting share repurchases.
Year-to-Date Second Quarter Fiscal Year 2026 Highlights vs. Year-to-date Second Quarter 2025
Net sales of $666.2 million decreased 5.0% versus the comparable year ago period, driven by declines for Atkins and OWYN of 21.6% and 10.2%, respectively, and offset by Quest growth of 4.7%. Atkins declines were largely as expected. OWYN's net sales decline was the result of a product quality issue, lapping the heavy promotional period in the prior year and poor base velocities, including on newly expanded distribution.
Total Simply Good Foods retail takeaway decreased about 2.6% driven by growth for Quest and OWYN of 6.9% and 6.3%, respectively, while Atkins declined 21.3%, largely as expected.
Gross profit of $212.9 million decreased 18.3% versus the comparable year ago period, driven by elevated input inflation, including the higher tariff expenses. Productivity was a modest offset. Gross margin was 32.0%, a 520 basis point decline versus the comparable year ago period, driven by elevated input costs which were only partially offset by productivity and mix. Excluding $6.5 million of one-time OWYN integration expenses in the current year period and a $1.4 million non-cash inventory purchase accounting step-up adjustment expense related to the OWYN acquisition that occurred in the comparable prior year period, gross margin was 32.9%, a 450 basis point decline versus the comparable year ago period.
Selling and marketing expenses of $57.8 million decreased 15.0% versus the comparable year ago period driven by planned marketing declines for Atkins, which more than offset increases to support growth for Quest and OWYN.
G&A expenses of $72.9 million decreased 1.6% versus the comparable year ago period. Excluding in the current year period restructuring costs of $4.5 million, integration expenses of $4.1 million, and term loan transaction fees of $3.0 million and in the prior year period integration expenses of $6.9 million and term loan transaction fees of $0.7 million, G&A declined 7.9% to $61.2 million.
Net interest expense of $8.7 million reflected a 31.3% decrease versus the comparable year ago period due to lower interest rates.
As part of the Company's process to evaluate the carrying value of our brands, we recognized an aggregate $249.0 million non-cash, impairment charge related to the Atkins brand and OWYN brand intangible assets. The impairment is largely the result of a challenging fiscal year 2026 and updated projections of future revenue.
The effective tax rate was 27.0%.
Net loss of $134.4 million compared to net income of $74.9 million versus the comparable year ago period.
Adjusted EBITDA of $111.1 million decreased 19.5% versus the comparable year ago period.
Reported loss per diluted share was $1.41 versus reported earnings per share of $0.74 in the comparable year ago period.
Adjusted Diluted EPS was $0.84 versus $0.95 in the comparable year ago period.
Weighted average diluted shares outstanding of 95.5 million declined modestly versus the comparable year ago period, reflecting share repurchases.
Balance Sheet and Cash Flow
At the end of the second quarter of fiscal year 2026, the Company had cash of $107.4 million and an outstanding principal balance on its term loan of $400.0 million, bringing the Company's quarter-end trailing twelve-month Net Debt to Adjusted EBITDA ratio to 1.2x(6) . Higher cash and debt balances reflect the Company's strategic decision to borrow an additional $150.0 million concurrently with a three-year extension of the Company's existing credit facilities, which closed in November 2025. Year-to-date cash flow from operations was about $58.2 million versus $63.3 million in the comparable year ago period. Capital expenditures were approximately $7.6 million.
During the quarter, the Company repurchased approximately 4.6 million shares of its common stock for approximately $89 million.
Fiscal Year 2026 Outlook
The Company is updating its previously provided outlook for fiscal year 2026:
-- Net Sales expected to range between $1.31 to $1.35 billion, or -10% to
-7% year-over-year
-- Gross Margins expected to decline between 300 and 350 basis points
year-over-year
-- Adjusted EBITDA expected to range between $217 to $225 million, or -22%
to -19% year-over-year
The company continues to expect net interest expense in the range of $19 to $21 million and an effective tax rate of approximately 25%. Finally, given the impact of year-to-date share repurchases, the company now expects a weighted average diluted share count of approximately 92 million shares.
For the third quarter of fiscal year 2026:
-- The company expects Net Sales to range between $329 to $338 million, or
-14% to -11% year-over-year
-- Adjusted EBITDA expected to range from $46 to $50 million, or -38% to
-32% year-over-year
The foregoing outlook assumes current economic conditions, consumer purchasing behavior and prevailing tariff rates remain generally consistent across the Company's fiscal year.
________________________________
(1) All comparisons for the second quarter ended February 28, 2026, versus the comparable year-ago period ended March 1, 2025.
(2) Adjusted Diluted Earnings Per Share is a non-GAAP financial measure. The Company excludes restructuring costs, acquisition-related costs, such as Business Transaction costs, integration expense and depreciation and amortization expense in calculating Adjusted Diluted Earnings Per Share. Please refer to "Reconciliation of Adjusted Diluted Earnings Per Share" in this press release for an explanation and reconciliation of this non-GAAP financial measure.
(3) Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA") is a non-GAAP financial measure. Please refer to the "Reconciliation of EBITDA and Adjusted EBITDA" in this press release for an explanation and reconciliation of this non-GAAP financial measure.
(4) The Company does not provide a forward-looking reconciliation of expected Fiscal Year 2026 Adjusted EBITDA to Net Income, the most directly comparable GAAP financial measure, because we are unable to provide such a reconciliation without unreasonable effort due to the unavailability of reliable estimates for certain components of consolidated net income and the respective reconciliations, and the inherent difficulty of predicting what the changes in these components will be throughout the fiscal year. As these items may vary greatly between periods, we are unable to address the probable significance of the unavailable information, which could significantly affect our future financial results.
(5) Combined Quest, Atkins, and OWYN Circana MULO++C and Company unmeasured channel estimate for the 13-weeks ending March 1, 2026, vs. the comparable 13-week year ago period.
(6) Net Debt to Adjusted EBITDA is a non-GAAP financial measure which Simply Good Foods defines as the total debt outstanding under our credit agreement with Barclays Bank PLC and other parties ("Credit Agreement"), reduced by cash and cash equivalents, and divided by the Company's trailing twelve month Adjusted EBITDA, as previously defined. The Company does not provide a forward-looking reconciliation of Net Debt to Adjusted EBITDA to Net Debt to Consolidated Net Income, the most directly comparable GAAP financial measures, expected for Fiscal Year 2026, because we are unable to provide such a reconciliation without unreasonable effort due to the unavailability of reliable estimates for certain components of consolidated net income and the respective reconciliations, and the inherent difficulty of predicting what the changes in these components will be throughout the fiscal year. As these items may vary greatly between periods, we are unable to address the probable significance of the unavailable information, which could significantly affect our future financial results.
Conference Call and Webcast Information
The Company will host a conference call with members of the executive management team to discuss these results today, Thursday, April 9, 2026, at 6:30 a.m. Mountain time (8:30 a.m. Eastern time). Investors interested in participating in the live call can dial 877-407-0792 from the U.S. or 201-689-8263 from international locations. A live webcast will be available via the "Investors" section of the Company's website at www.thesimplygoodfoodscompany.com. A telephone replay will be available approximately two hours after the call concludes and will remain accessible through April 16, 2026, by dialing 844-512-2921 from the U.S., or 412-317-6671 from international locations, and entering confirmation code 13758838.
About The Simply Good Foods Company
The Simply Good Foods Company (Nasdaq: SMPL), headquartered in Denver, Colorado, is a consumer packaged food and beverage company with ambitious goals to raise the bar on what food can be with trusted brands and innovative nutritious snacking products. Within our portfolio of trusted brands (Quest$(TM)$, Atkins(TM), and OWYN(TM)), we offer a wide variety of nutritional snacks and beverages, including high protein chips, bars, ready-to-drink (RTD) shakes, and powders, and low sugar, low carb sweets and baked goods. We are a leader of the nutritious snacking movement, poised to expand our healthy lifestyle platform through innovation-driven organic growth and external investment opportunities. To learn more, visit www.thesimplygoodfoodscompany.com.
Investor Contact
Matt Siler
Vice President, Investor Relations and Treasury
The Simply Good Foods Company
msiler@simplygoodfoodsco.com
Forward Looking Statements
Certain statements made herein are not historical facts but are forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Forward-looking statements generally are accompanied by or include words such as "will", "expect", "intends" or other similar words, phrases or expressions. These statements relate to future events or our future financial or operational performance and involve known and unknown risks, uncertainties and other factors that could cause our actual results, levels of activity, performance or achievement to differ materially from those expressed or implied by these forward-looking statements. We caution you that these forward-looking statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. You should not place undue reliance on forward-looking statements. These statements reflect our current views with respect to future events, are based on assumptions and are subject to risks and uncertainties. These risks and uncertainties relate to, among other things, our operations being dependent on changes in consumer preferences and purchasing habits regarding our products, a global supply chain and effects of supply chain constraints, inflationary pressure and tariffs on us and our contract manufacturers, our ability to continue to operate at a profit or to maintain our margins, the sufficiency of our sources of liquidity and capital, our ability to maintain current operation levels and implement our growth strategies, our ability to maintain and gain market acceptance for our products or new products, our ability to capitalize on attractive opportunities, our ability to respond to competition and changes in the economy including changes regarding inflation and increasing ingredient and packaging costs and labor challenges due to tariffs or other challenges at our contract manufacturers and third party logistics providers, the amounts of or changes with respect to certain anticipated raw materials and other costs, difficulties and delays in achieving the synergies and cost savings in connection with acquisitions, changes in the business environment in which we operate including general financial, economic, capital market, regulatory and geopolitical conditions affecting us and the industry in which we operate, our ability to maintain adequate product inventory levels to timely supply customer orders, changes in taxes, tariffs, duties, governmental laws and regulations, the availability of or competition for other brands, assets or other opportunities for investment by us or to expand our business, competitive product and pricing activity, difficulties of managing growth profitably, the effect pandemics or other global disruptions on our business, financial condition and results of operations, the loss of one or more members of our management team, potential for increased costs, the harm to our business resulting from unauthorized access of the information technology systems we use in our business, and other risks and uncertainties indicated in the Company's Form 10-K, Form 10-Q, and Form 8-K reports (including all amendments to those reports) filed with the U.S. Securities and Exchange Commission from time to time. In addition, forward-looking statements provide the Company's expectations, plans or forecasts of future events and views as of the date of this communication. Except as required by law, the Company undertakes no obligation to update such statements to reflect events or circumstances arising after such date and cautions investors not to place undue reliance on any such forward-looking statements. These forward-looking statements should not be relied upon as representing the Company's assessments as of any date subsequent to the date of this communication.
The Simply Good Foods Company and Subsidiaries
Consolidated Balance Sheets
(Unaudited, dollars in thousands, except share and
per share data)
February 28, 2026 August 30, 2025
Assets
Current assets:
Cash $ 107,444 $ 98,468
Accounts
receivable, net 123,517 164,978
Inventories 189,780 167,217
Prepaid expenses 5,310 7,209
Other current
assets 13,292 15,812
Total current
assets 439,343 453,684
Long-term assets:
Property and
equipment, net 42,694 39,738
Intangible
assets, net 1,004,763 1,261,603
Goodwill 589,974 589,974
Other long-term
assets 48,930 51,046
Total assets $ 2,125,704 $ 2,396,045
Liabilities and
stockholders'
equity
Current
liabilities:
Accounts payable $ 66,518 $ 78,298
Accrued interest 63 44
Accrued expenses
and other
current
liabilities 20,297 46,219
Total current
liabilities 86,878 124,561
Long-term
liabilities:
Long-term debt,
less current
maturities 396,866 249,066
Deferred income
taxes 106,629 166,091
Other long-term
liabilities 45,506 49,494
Total liabilities 635,879 589,212
See commitments and
contingencies (Note
9)
Stockholders'
equity:
Preferred stock,
$0.01 par value,
100,000,000
shares
authorized, none
issued -- --
Common stock,
$0.01 par value,
600,000,000
shares
authorized,
104,033,175 and
103,688,071
shares issued at
February 28,
2026, and August
30, 2025,
respectively 1,040 1,037
Treasury stock,
13,548,075
shares and
3,957,571 shares
at cost at
February 28,
2026, and August
30, 2025,
respectively (319,397) (129,337)
Additional
paid-in-capital 1,353,320 1,346,687
Retained earnings 456,450 590,879
Accumulated other
comprehensive
loss (1,588) (2,433)
Total
stockholders'
equity 1,489,825 1,806,833
Total liabilities
and stockholders'
equity $ 2,125,704 $ 2,396,045
The Simply Good Foods Company and Subsidiaries
Consolidated Statements of Income and Comprehensive
Income
(Unaudited, dollars in thousands, except share and
per share data)
Thirteen Weeks Ended Twenty-Six Weeks Ended
------------------------------------------------------------------
February 28, 2026 March 1, 2025 February 28, 2026 March 1, 2025
-------------------------------- -----------------------------------
Net sales $ 326,013 $ 359,655 $ 666,211 $ 700,923
Cost of goods sold 222,980 229,518 453,278 440,300
Gross profit 103,033 130,137 212,933 260,623
Operating expenses:
Selling and
marketing 28,167 35,078 57,844 68,072
General and
administrative 34,875 36,013 72,881 74,077
Depreciation and
amortization 4,309 4,148 8,942 8,308
Business
transaction
costs -- 177 -- 820
Loss on impairment 249,000 -- 249,000 --
Total operating
expenses 316,351 75,416 388,667 151,277
(Loss) income from
operations (213,318) 54,721 (175,734) 109,346
Other income
(expense):
Interest income 880 701 1,379 1,477
Interest expense (5,833) (6,338) (10,119) (14,199)
Gain (loss) on
foreign currency
transactions 190 (125) 133 (5)
Other income 60 19 136 34
Total other (expense) (4,703) (5,743) (8,471) (12,693)
(Loss) income before
income taxes (218,021) 48,978 (184,205) 96,653
Income tax (benefit)
expense (58,323) 12,231 (49,776) 21,784
Net (loss) income $ (159,698) $ 36,747 $ (134,429) $ 74,869
Other comprehensive
income:
Foreign currency
translation, net
of
reclassification
adjustments 1,067 (426) 845 (813)
Comprehensive (loss)
income $ (158,631) $ 36,321 $ (133,584) $ 74,056
(Loss) earnings per
share from net
(loss) income:
Basic $ (1.73) $ 0.36 $ (1.41) $ 0.74
Diluted $ (1.73) $ 0.36 $ (1.41) $ 0.74
Weighted average
shares outstanding:
Basic 92,343,383 101,040,501 95,546,361 100,724,155
Diluted 92,343,383 101,821,229 95,546,361 101,674,934
The Simply Good Foods Company and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited, dollars in thousands)
Twenty-Six Weeks Ended
February 28, 2026 March 1, 2025
-------------------------------- -----------------------------------
Operating
activities
Net (loss) income $ (134,429) $ 74,869
Adjustments to
reconcile net
(loss) income to
net cash provided
by operating
activities:
Depreciation
and
amortization 12,069 10,135
Amortization of
deferred
financing
costs and debt
discount 319 951
Stock
compensation
expense 7,627 8,792
Loss on
impairment 249,000 --
Estimated
credit losses 65 101
Unrealized
(gain) loss on
foreign
currency
transactions (133) 5
Deferred income
taxes (59,462) 6,440
Amortization of
operating
lease
right-of-use
asset 2,978 3,369
Other 3,187 168
Changes in
operating
assets and
liabilities:
Accounts
receivable,
net 41,744 (7,028)
Inventories (25,401) (22,445)
Prepaid
expenses 1,868 (4,189)
Other current
assets 2,577 (987)
Accounts
payable (11,200) 16,566
Accrued
interest 19 (206)
Accrued
expenses and
other
current
liabilities (28,454) (19,470)
Other assets
and
liabilities (4,180) (3,804)
Net cash provided
by operating
activities 58,194 63,267
Investing
activities
Purchases of
property and
equipment (7,633) (802)
Acquisition of
business, net
of cash
acquired -- 1,713
Investments in
intangible and
other assets -- (911)
Net cash used in
investing
activities (7,633) --
Financing
activities
Proceeds from
option
exercises 1,056 10,136
Tax payments
related to
issuance of
restricted
stock units
and
performance
stock units (2,047) (2,522)
Repurchase of
common stock (188,181) --
Principal
payments of
long-term
debt -- (100,000)
Proceeds from
issuance of
long-term
debt 150,000 --
Deferred
financing
costs (2,632) --
Net cash used in
financing
activities (41,804) (92,386)
Cash and cash
equivalents
Net increase
(decrease) in
cash 8,757 (29,119)
Effect of
exchange rate
on cash 219 271
Cash at
beginning of
period 98,468 132,530
Cash and cash
equivalents at end
of period $ 107,444 $ 103,682
Net Sales by Geographic Area and Brands
The following is a summary of revenue disaggregated
by geographic area and brands:
Thirteen Weeks Ended Twenty-Six Weeks Ended
(In thousands) February 28, 2026 March 1, 2025 February 28, 2026 March 1, 2025
------------------------------ ------------------------------ -----------------------------
North America
(1)
Atkins $ 79,717 $ 108,650 $ 169,987 $ 216,818
Quest 211,442 210,771 421,785 402,708
OWYN 28,135 33,806 59,317 66,060
Total North
America 319,294 353,227 651,089 685,586
International 6,719 6,428 15,122 15,337
Total net
sales $ 326,013 $ 359,655 $ 666,211 $ 700,923
(1) The North America geographic area consists of
net sales substantially related to the United States
and there is no individual foreign country to which
more than 10% of the Company's net sales are attributed
or that is otherwise deemed individually material.
Reconciliation of EBITDA and Adjusted EBITDA
EBITDA and Adjusted EBITDA. EBITDA and Adjusted EBITDA are non-GAAP financial measures commonly used in our industry and should not be construed as alternatives to net income as an indicator of operating performance or as alternatives to cash flow provided by operating activities as a measure of liquidity (each as determined in accordance with GAAP). Simply Good Foods defines EBITDA as net income or loss before interest income, interest expense, income tax expense, depreciation and amortization, and Adjusted EBITDA as further adjusted to exclude the following items: loss on impairment, stock-based compensation expense, business transaction costs, purchase price accounting inventory step-up, integration costs, term loan transaction fees, restructuring, and other non-core expenses. The Company believes that EBITDA and Adjusted EBITDA, when used in conjunction with net income, are useful to provide additional information to investors. Management of the Company uses EBITDA and Adjusted EBITDA to supplement net income because these measures reflect operating results of the on-going operations, eliminate items that are not directly attributable to the Company's underlying operating performance, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to the key metrics the Company's management uses in its financial and operational decision making. The Company also believes that EBITDA and Adjusted EBITDA are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in its industry. EBITDA and Adjusted EBITDA may not be comparable to other similarly titled captions of other companies due to differences in the non-GAAP calculation.
The following unaudited table provides a reconciliation of EBITDA and Adjusted EBITDA to its most directly comparable GAAP measure, which is net income, for the thirteen and twenty-six weeks ended February 28, 2026, and March 1, 2025:
Thirteen Weeks Ended Twenty-Six Weeks Ended
----------------- ------------------------------------------------------------------ --------------------------------------------------------------------
(In thousands) February 28, 2026 March 1, 2025 February 28, 2026 March 1, 2025
----------------- -------------------------------- -------------------------------- -------------------------------- ----------------------------------
Net (loss) income $ (159,698) $ 36,747 $ (134,429) $ 74,869
Interest income (880) (701) (1,379) (1,477)
Interest expense 5,833 6,338 10,119 14,199
Income tax
(benefit)
expense (58,323) 12,231 (49,776) 21,784
Depreciation and
amortization 5,864 5,088 12,069 10,135
------------------------------ ------------------------------ ------------------------------ ------------------------------
EBITDA (207,204) 59,703 (163,396) 119,510
Loss on
impairment 249,000 -- 249,000 --
Stock-based
compensation
expense 4,544 4,948 7,627 8,792
Business
transaction
costs -- 177 -- 820
Inventory
step-up -- 438 -- 1,412
Integration
expense (1) 4,703 1,955 10,621 6,886
Term loan
transaction
fees 202 715 3,030 715
Restructuring
and other
costs 4,524 -- 4,524 --
Other (2) (259) 65 (272) (66)
------------------------------ ------------------------------ ------------------------------ ------------------------------
Adjusted EBITDA $ 55,510 $ 68,001 $ 111,134 $ 138,069
============================== ============================== ============================== ==============================
(1) Includes one-time effects from actions taken to
mitigate OWYN product quality issues.
(2) Other items consist principally of exchange impact
of foreign currency transactions and other expenses.
Reconciliation of Adjusted Diluted Earnings Per Share
Adjusted Diluted Earnings per Share. Adjusted Diluted Earnings per Share is a non-GAAP financial measure commonly used in our industry and should not be construed as an alternative to diluted earnings per share as an indicator of operating performance. Simply Good Foods defines Adjusted Diluted Earnings Per Share as diluted earnings per share before loss on impairment, stock-based compensation expense, business transaction costs, purchase price accounting inventory step-up, integration costs, restructuring, and term loan transaction fees on a theoretical tax effected basis of such adjustments. The tax effect of such adjustments to Adjusted Diluted Earnings Per Share is calculated by applying an overall assumed statutory tax rate to each gross adjustment as shown in the reconciliation to Adjusted EBITDA, as previously defined. The assumed statutory tax rate reflects a normalized effective tax rate estimated based on assumptions regarding the Company's statutory and effective tax rate for each respective reporting period, including the current and deferred tax effects of each adjustment, and is adjusted for the effects of tax reform, if any. The Company consistently applies the overall assumed statutory tax rate to periods throughout each fiscal year and reassesses the overall assumed statutory rate on annual basis. The Company believes that the inclusion of these supplementary adjustments in presenting Adjusted Diluted Earnings per Share, when used in conjunction with diluted earnings per share, are appropriate to provide additional information to investors, reflects more accurately operating results of the on-going operations, enhances the overall understanding of past financial performance and future prospects and allows for greater transparency with respect to the key metrics the Company uses in its financial and operational decision making. The Company also believes that Adjusted Diluted Earnings per Share is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in its industry. Adjusted Diluted Earnings per Share may not be comparable to other similarly titled captions of other companies due to differences in the non-GAAP calculation.
The following unaudited tables below provide a reconciliation of Adjusted Diluted Earnings Per Share to its most directly comparable GAAP measure, which is diluted earnings per share, for the thirteen and twenty-six weeks ended February 28, 2026, and March 1, 2025:
Thirteen Weeks Ended Twenty-Six Weeks Ended
------------------------------------------------------------------ --------------------------------------------------------------------
February 28, 2026 March 1, 2025 February 28, 2026 March 1, 2025
-------------------------------- -------------------------------- -------------------------------- ----------------------------------
Diluted (loss)
earnings per
share $ (1.73) $ 0.36 $ (1.41) $ 0.74
------------------------------ ------------------------------ ------------------------------ ------------------------------
Depreciation
and
amortization 0.06 0.05 0.13 0.10
Loss on
impairment 2.70 -- 2.61 --
Stock-based
compensation
expense 0.05 0.05 0.08 0.09
Business
transaction
costs -- -- -- 0.01
Inventory
step-up -- -- -- 0.01
Integration
expense 0.05 0.02 0.11 0.07
Term loan
transaction
fees -- 0.01 0.03 0.01
Restructuring
and other
costs 0.05 -- 0.05 --
Tax effects of
adjustments
(1) (0.73) (0.03) (0.75) (0.07)
Rounding (2) -- -- (0.01) (0.01)
------------------------------ ------------------------------ ------------------------------ ------------------------------
Adjusted
diluted
earnings per
share $ 0.45 $ 0.46 $ 0.84 $ 0.95
(1) This line item reflects the aggregate tax effect
of all non-tax adjustments reflected in the preceding
line items of the table. The tax effect of each adjustment
is computed (i) by dividing the gross amount of the
adjustment, as shown in the Adjusted EBITDA reconciliation,
by the number of diluted weighted average shares outstanding
for the applicable fiscal period and (ii) applying
an overall assumed statutory tax rate of 25% for the
thirteen and twenty-six week periods ended February
28, 2026, as well as the thirteen and twenty-six week
periods ended March 1, 2025.
(2) Adjusted Diluted Earnings Per Share amounts are
computed independently for each quarter. Therefore,
the sum of the quarterly Adjusted Diluted Earnings
Per Share amounts may not equal the year to date Adjusted
Diluted Earnings Per Share amounts due to rounding.
Reconciliation of Net Debt to Adjusted EBITDA
Net Debt to Adjusted EBITDA. Net Debt to Adjusted EBITDA is a non-GAAP financial measure which Simply Good Foods defines as the total debt outstanding under our credit agreement with Barclays Bank PLC and other parties ("Credit Agreement"), reduced by cash and cash equivalents, and divided by the trailing twelve months of Adjusted EBITDA, as previously defined.
The following unaudited table below provides a reconciliation of Net Debt to Adjusted EBITDA as of February 28, 2026:
(In thousands) February 28, 2026
-------------------------------------- -----------------------------------
Net Debt:
Total debt outstanding under the
Credit Agreement $ 400,000
Less: cash and cash equivalents (107,444)
----------------------------
Net Debt as of February 28, 2026 $ 292,556
Trailing twelve months Adjusted
EBITDA:
Add: Adjusted EBITDA for the
twenty-six weeks ended February 28,
2026 $ 111,134
Add: Adjusted EBITDA for the fiscal
year ended August 30, 2025 278,162
Less: Adjusted EBITDA for the
twenty-six weeks ended March 1,
2025 (138,069)
----------------------------
Trailing twelve months Adjusted
EBITDA as of February 28, 2026 $ 251,227
Net Debt to Adjusted EBITDA 1.2 x
(END) Dow Jones Newswires
April 09, 2026 07:00 ET (11:00 GMT)