News Spotlight: The Simply Good Foods Company (NASDAQ:SMPL)

The Simply Good Foods Company (NASDAQ:SMPL) stock identified change of 86.30% away from 52-week low price and recently located move of 3.24% off 52-week high price. It has market worth of $2226.97M . SMPL stock has been recorded 20.96% away from 50 day moving average and 35.42% away from 200 day moving average. Moving closer, we can see that shares have been trading 15.82% off 20-day moving average.

The Simply Good Foods Company (NASDAQ:SMPL), a developer, marketer and seller of branded nutritional snacking and meal replacement products, reported financial results for the thirteen and thirty-nine week periods ended May 25, 2019.

Joseph E. Scalzo, President and Chief Executive Officer of Simply Good Foods said “We’re pleased with our strong third quarter results and the continued business momentum”. “We delivered double-digit sales growth in both the third quarter and year-to-date periods driven by our successful marketing strategy that positions Atkins as the brand of choice for consumers seeking nutritious and delicious snacking and meal replacement products for low carb lifestyles. U.S. retail takeaway, as measured by IRI for the thirteen week period ended May 25, 2019, continued to be strong and was up 19.5% versus the prior year. Gross profit and adjusted EBITDA growth also increased double-digits in both the third quarter and year-to-date periods reflecting the strong sales growth as well as investments in marketing and capabilities that we believe will benefit the Company in the near and long term.”

Third Quarter 2019 Financial Highlights vs. Third Quarter 2018

Net sales increased 30.1%, or $32.2 million, to $139.5 million

Gross profit margin of 46.8%, a decrease of 100 basis points

Income tax expense was $4.6 million versus $2.8 million

Net income increased 88.7%, or $6.3 million, to $13.5 million

Earnings per diluted share (“EPS”) of $0.16 increased $0.06

Adjusted EBITDA(1) increased 38.8% to $24.9 million

Net sales increased $32.2 million, or 30.1%, to $139.5 million, primarily driven by volume growth. Net price realization was a slight benefit in third quarter and was more than offset by a shift in non-price related customer activity, as discussed last quarter. As expected, net sales growth outpaced retail takeaway driven by the timing of inventory changes compared to prior year at key retailers. Year-to-date net sales growth and retail takeaway are now relatively in-line. The Company’s supply situation has improved and we believe we are well positioned to meet consumer demand.

Gross profit was $65.3 million for the third quarter of 2019, an increase of $14.0 million or 27.3%. Gross profit margin was 46.8% compared to 47.8% for the thirteen weeks ended May 26, 2018, a decline of 100 basis points versus last year. As discussed previously, gross margin is impacted by a shift in non-price related customer activity that negatively impacted the third quarter of 2019 by 120 basis points. Savings from the strategic sourcing initiative in the third quarter were in-line with estimates and, as expected, offset inflation.

Net income for the third quarter of 2019 was $13.5 million, compared with $7.1 million for the comparable period of 2018 primarily due to the increase in gross profit, partially offset by higher operating expenses and income tax expense. Specifically, marketing expense increased $3.7 million, driven by higher television media and e-commerce investments. General and administrative expenses increased $4.1 million due primarily to greater incentive compensation and slightly higher distribution center costs. Selling expense was $2.2 million lower than last year due to the aforementioned shift in non-price related customer activity.

Adjusted EBITDA, a non-GAAP financial measure used by the Company that makes certain adjustments to net income calculated under GAAP, increased 38.8% to $24.9 million.

 The Consumer Goods sector company, The Simply Good Foods Company noticed change of 4.01% to $27.74 along volume of 1357595 shares in recent session compared to an average volume of 457.3K. The stock observed return of 17.54% in 5 days trading activity. The stock was at 21.40% over one month performance. SMPL’s shares are at 25.46% for the quarter and driving a 84.32% return over the course of the past year and is now at 46.77% since this point in 2018.  The average volatility for the week at 4.64% and for month was at 3.26%. There are 80.28M shares outstanding and 70.2M shares are floated in market. 

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