Bottom line expectations
Analysts expect Flowers Foods (FLO) to report adjusted EPS of $0.28 compared to its adjusted EPS of $0.24 in the same quarter last year. Its adjusted net income is expected to be $58.3 million compared the $50.5 million it reported in the corresponding quarter last year.
The company is set to report its earnings results on August 8.
FLO’s adjusted EBITDA is expected to be $114.8 million in the second quarter compared to $113.7 million in the second quarter of 2017. Its adjusted EBITDA is likely to benefit from higher sales and operational efficiencies.
Past EPS performance
Flowers Foods’ first-quarter adjusted EPS of $0.30 missed analysts’ expectation of $0.31. The company’s adjusted EPS were up 20% on a YoY basis. Its adjusted net income was $63.2 million compared to $52.6 million in the first quarter of fiscal 2017. Its adjusted EBITDA was $132.9 million, almost unchanged on a YoY basis. However, its adjusted EBITDA margin of 11% was down 20 basis points on a YoY basis.
On a reported basis, its EPS fell to $0.24 from $0.29 YoY. Lower operating income and the recording of $4.7 million in pension plan settlement losses negatively affected its bottom line.
Flowers Foods has warned that it’s likely to see a $40 million increase in commodity costs in 2018. To combat this situation, the company is looking to save $38 million–$48 million through its Project Centennial. Project Centennial is the company’s cost-saving initiative, under which the company is cutting costs by right-sizing its operations and streamlining its supply chain.