B&G Foods Inc. (BGS) stock soared 5.42% in Wednesday's pre-market trading session, outperforming the broader market. This surge came despite the company reporting lower volumes and a marginal decline in net sales for the fourth quarter of 2024.
The key driver behind this rally appears to be the company's resilient margins and strategic initiatives to reshape its portfolio. B&G Foods reported an adjusted gross margin of 22.2%, an improvement of 30 basis points compared to the same quarter last year. Additionally, the company's adjusted EBITDA margin expanded by 60 basis points to 15.6%, reflecting its efforts to enhance profitability.
While the company faced challenges such as lower unit volumes, the divestiture of the Green Giant U.S. shelf-stable product line, and currency headwinds, it managed to offset these impacts through higher net pricing and an improved product mix. The spices and flavor solutions business unit, in particular, demonstrated robust performance with a 5% increase in net sales year-over-year.
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