Simply Good Foods Co (NASDAQ:SMPL) stock rose 1% (As on January 6, 11:17:45 AM UTC-4, Source: Google Finance) after the company posted mixed results for the first quarter of FY 23. Net price realization was about a 9.8 percentage point contribution to net sales growth and volume was off about 1.7 percentage points. The March 2022 agreement to license the Quest frozen pizza business to Bellisio Foods was a 1.1 percentage point headwind. North America net sales increased 7.8% driven by Quest and the international business declined 16.5% due to lower velocities, the timing of shipments and foreign exchange. Total Simply Good Foods retail takeaway for the thirteen weeks ended November 26, 2022, increased 11.1% in the U.S. measured channels of IRI MULO + Convenience Stores. In the first quarter of fiscal 2023, total Simply Good Foods combined measured and unmeasured channel U.S. retail takeaway increased about 14%. Atkins and Quest retail takeaway in the combined measured and unmeasured channels increased about 4% and 24%, respectively. In the first quarter of fiscal 2023, the Company reported net income of $35.9 million compared to $21.2 million for the comparable period of fiscal 2022. In the first quarter of fiscal 2022, results were affected by the remeasurement of the Company’s private warrant liabilities. Specifically, in the first quarter of fiscal 2022, the Company recognized a non-operating, non-cash charge of $17.3 million related to the fair value change of private warrant liabilities. At the end of the first quarter of fiscal 2023, the Company had cash of $54.1 million.
SMPL in the first quarter of FY 23 has reported the adjusted earnings per share of 42 cents, beating the analysts’ estimates for the adjusted earnings per share of 41 cents, according to Zacks Investment Research. The company had reported the adjusted revenue growth of 7 percent to $300.9 million in the first quarter of FY 23, missing the analysts’ estimates for revenue of $301.9 billion. Gross profit was $111.0 million for the first quarter of fiscal 2023, a decline of $5.6 million from the year ago period, resulting in gross margin of 36.9%. The 450 basis points decline versus the year ago period was slightly higher than forecast. Adjusted EBITDA was $60.8 million versus $65.6 million in the year ago period.
Adjusted EBITDA anticipated to increase in line with the net sales growth rate