Utz Brands Stock Rises as Salty Snacks Sales Drive Profit Higher
Key Takeaways
Shares of Utz Brands (
UTZ
) rose 6% Thursday as the food company posted better-than-expected profit on higher sales of its salty snack products.
The maker of pretzels, potato chips, and other treats reported fourth-quarter adjusted
earnings per share (EPS)
of $0.22, slightly ahead of the consensus estimate of analysts surveyed by Visible Alpha. Revenue declined 3% year-over-year to $341.0 million, missing forecasts.
Organic net sales
at Branded Salty Snacks grew 3%, lifted by the firm’s Power Four Brands. However, organic net sales were down 18% at Non-Branded & Non-Salty Snacks, mainly because of drops in demand for its Partner Brands and Dips & Salsas.
CEO Howard Friedman attributed the results to the strong salty snacks sales “while we continued to carefully manage low-margin partner brands, private label, and non-salty snacks.”
The company sees full-year adjusted EPS increasing 10% to 15% on better
operating profit
and lower interest expenses. It expects organic net sales to rise by a low-single-digit percentage, driven by “continued Branded Salty Snacks growth, particularly the Power Four Brands, and less decline in Non-Branded & Non-Salty Snacks.”
Despite today’s advance, Utz Brands shares have lost nearly a quarter of their value in the past year.
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