Flower Food Inc(FLO) Q2 results beat the estimated earnings per share (EPS) by 8.03% but missed the estimated revenue by 1.41%. In this article, we will discuss Flower Food Inc Q2 Results.
Ryals McMullian the CEO and chairman of Flower Food Inc said that we continued to execute well in the second quarter with a solid top- and bottom-line performance. We improved profitability in existing accounts and filled available capacity with new, higher-margin businesses, and improved costs.
Second Quarter Highlights
- Sales decreased 0.2% to $1.225 billion as positive pricing/mix was more than offset by volume declines, primarily due to business exits.
- Net income increased 5.0% to $67.0 million, primarily due to growth in operating income, partially offset by higher net interest and income tax expense. Adjusted net income(1) increased 6.5% to $75.5 million.
- Adjusted EBITDA(1) increased 7.8% to $143.5 million, representing 11.7% of sales, a 90 basis point increase.
- Diluted EPS increased $0.02 to $0.32. Adjusted diluted EPS(1) increased $0.03 to $0.36.
Consolidated Q2 Operating Highlights
Sales decreased 0.2% to $1.225 billion. Pricing/mix(3) increased 1.0% and volume(4) declined 1.2%.
- Branded Retail sales increased $2.3 million or 0.3% to $789.5 million due to favorable price/mix resulting from a shift in mix to more premium-priced products. Pricing/mix(3) rose 0.3% and volume(4) was flat.
- Other sales decreased $5.4 million or 1.2% to $435.5 million due to volume declines resulting from lower margin foodservice business we exited in the second half of Fiscal 2023, partially offset by positive price/mix for non-retail sales. Pricing/mix(3) rose 1.6% and volume(4) declined 2.8.
- Restructuring charges were $6.8 million, or 0.6% of sales, compared to $2.5 million, or 0.2% of sales in the prior-year quarter.
- Depreciation and amortization (D&A) expenses were $36.8 million or 3.0% of sales, a 20-basis point increase.
- Net interest expense increased $0.7 million primarily due to lower interest income resulting from decreases in distributor notes receivable outstanding.
- Net income increased 5.0% to $67.0 million. Adjusted net income(1) increased 6.5% to $75.5 million.
Cash Flow, Capital Allocation, and Capital Return
Year-to-date, through the second quarter of fiscal 2024, cash flow from operating activities increased $39.5 million to $168.4 million, capital expenditures decreased $7.1 million to $61.3 million, and dividends paid to shareholders increased $3.8 million to $101.9 million. Cash and cash equivalents were $6.9 million at quarter end.
Flower Food Inc Consolidated Balance Sheets and Cash Flow Highlights
- Balance Sheets: The current assets increased from 655,422 to 680,906, and total assets increased from 3,426,953 to 3,428,061.
- Statement of Operations: The sales decreased from 1,228,050 to 1,224,983, Income from operations increased from 88,554 to 95,212, Net income increased from 63,760 to 66,967 and Net income per diluted common share increased from 0.30 to 0.32.
- Cash Flows: The Net cash provided by operating activities increased from 70,955 to 63,272.
- Earning Per Share: The Adjusted net income per diluted common share increased from 0.33 to 0.36.
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