Monday was earnings day for Denver-based The Simply Good Foods Company (NASDAQ: SMPL), a developer, marketer and seller of branded nutritional foods and snacking products, today reported financial results for the 13-week period ended February 29, 2020.
The Company completed the acquisition of Quest Nutrition, LLC on November 7, 2019. The Company’s second-quarter results include thirteen weeks of Quest results and about 16 weeks for the year-to-date period. Additionally, note that the Company’s reference to “legacy Atkins” in this press release encompasses Simply Goods Foods’ business excluding Quest.
Net sales increased 83.4%, or $103.3 million, to $227.1 million, Gross profit margin of 37.6%, a decrease of 250 basis points
Includes a non-cash $5.1 million inventory purchase accounting step-up adjustment related to the Quest acquisition. Net income was $10.7 million versus $12.7 million.
Adjusted EBITDA increased 81.7% to $41.7 million, primarily related to the Quest acquisition. Earnings per diluted share were $0.11, a decrease of $0.04 per fully diluted share. Adjusted Diluted EPS were $0.23 versus $0.18.
Gross profit was $85.4 million for the second quarter of 2020, an increase of $35.7 million or 72.0%. The increase in gross profit was driven by the Quest acquisition and legacy Atkins sales growth, partially offset by a non-cash $5.1 million inventory purchase accounting step-up adjustment related to the Quest acquisition.
Said CEO Joseph Scalzo, "Simply Good Foods’ second-quarter results exceeded our expectations with strong performance from both the legacy Atkins and Quest brands."
Shares gained 36 cents, or 1.9%, to $19.13
