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How Did Post Holdings Perform in 4Q16?

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Post Holdings’ price movement

Post Holdings (POST) rose 0.28% to close at $72.34 per share in the third week of November 2016. The stock’s weekly, monthly, and year-to-date (or YTD) price movements were 0.28%, -9.5%, and 17.2%, respectively, that day.

POST is trading 3.7% below its 20-day moving average, 7.0% below its 50-day moving average, and 5.6% below its 200-day moving average.

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Related ETF and peers

The iShares Morningstar Mid-Cap (JKG) invests 0.30% of its holdings in Post Holdings. The YTD price movement of JKG was 9.5% on November 18.

The market caps of Post Holdings’ competitors are as follows:

  • Kellogg (K): $25.8 billion
  • TreeHouse Foods (THS): $4.0 billion
  • B&G Foods (BGS): $2.7 billion

Post Holdings’ results for fiscal 4Q16

Post Holdings reported fiscal 4Q16 net sales of $1.26 billion, a fall of 3.7% compared to net sales of $1.31 billion in fiscal 4Q15. Net sales of active nutrition rose 16.7%. Net sales of Michael Foods Group and private brands fell 11.6% and 2.2%, respectively, in fiscal 4Q16 compared to fiscal 4Q15.

The company’s gross profit margin and operating margin expanded 450 basis points and 550 basis points, respectively, in fiscal 4Q16 compared to the prior year’s period.

Its net income and EPS (earnings per share) rose to -$40.4 million and -$0.58, respectively, in fiscal 4Q16 compared to -$76.8 million and -$1.21, respectively, in fiscal 4Q15. It reported adjusted EPS of $0.61 in fiscal 4Q16 compared to $0.06 in fiscal 4Q15.

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Fiscal 2016 results

In fiscal 2016, POST reported net sales of $5.0 billion, a rise of 8.1% YoY (year-over-year). The company’s gross profit margin and operating margin expanded 550 basis points and 630 basis points, respectively, in fiscal 2016 compared to the prior year’s period.

Its net income and EPS rose to -$28.4 million and -$0.41, respectively, in fiscal 2016 compared to -$132.3 million and -$2.33, respectively, in fiscal 2015. It reported adjusted EPS of $2.59 in fiscal 2016 compared to $0.62 in fiscal 2015.

POST’s cash and cash equivalents and inventories rose 35.9% and 8.1%, respectively, in fiscal 2016. Its current ratio and debt-to-equity ratio rose to 3.3x and 2.11x, respectively, in fiscal 2016 compared to 2.9x and 2.08x, respectively, in fiscal 2015.

Projections

Post Holdings has made the following projections for fiscal 2017:

  • adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) of $910.0 million–$950.0 million
  • capital expenditure of $180.0 million–$200.0 million
  • maintenance capital expenditure of $120.0 million–$140.0 million

In the next part, we’ll look at Spectrum Brands Holdings (SPB).

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