Post(POST) - 2024 Q4 - Annual Report

Financial Performance - Net sales increased by $931.7 million, or 13%, to$ 7,922.7 million for the year ended September 30, 2024, compared to $6,991.0 million in the prior year[146] - Operating profit rose by$ 194.6 million, or 32%, to $793.5 million for the year ended September 30, 2024, driven by higher segment profit in Post Consumer Brands, Weetabix, and Refrigerated Retail segments[148] - The company reported net earnings of$ 366.7 million for the year ended September 30, 2024, an increase of $65.4 million, or 22%, from the prior year[146] Segment Performance - Net sales for the Post Consumer Brands segment increased by$ 1,076.5 million, or 35%, for the year ended September 30, 2024, compared to the prior year[157] - Segment profit for Post Consumer Brands increased by $162.4 million, or 43%, driven by higher net sales, partially offset by increased product costs[159] - Weetabix segment net sales increased by$ 31.1 million, or 6%, for the year ended September 30, 2024, primarily due to the inclusion of ten months of Deeside net sales[160] - Foodservice segment net sales decreased by $118.8 million, or 5%, for the year ended September 30, 2024, primarily due to lower egg product sales[161] - Refrigerated Retail segment net sales decreased by$ 57.5 million, or 6%, for the year ended September 30, 2024, driven by lower average net selling prices across all product categories[163] Costs and Expenses - Interest expense increased by $37.4 million, or 13%, to$ 316.5 million for the year ended September 30, 2024, due to higher average outstanding principal amounts of debt and a higher weighted-average interest rate of 5.1%[149] - The company incurred increased costs due to outbreaks of highly pathogenic avian influenza, which impacted its Foodservice and Refrigerated Retail segments[144] - General corporate expenses decreased by $21.0 million, or 9%, for the year ended September 30, 2024, due to increased net gains related to mark-to-market adjustments[164] Acquisitions and Investments - The company completed the acquisition of Perfection Pet Foods, LLC and Deeside Cereals I Ltd on December 1, 2023, enhancing its product offerings in the pet food and cereal markets[142] - The company recorded a gain of$ 5.1 million related to its investment in BellRing Brands, Inc. during the year ended September 30, 2023[153] Tax and Compliance - The effective income tax rate decreased to 22.3% for fiscal 2024 from 24.1% in fiscal 2023[154] - The company continues to evaluate the impact of the OECD's global tax reform initiative, Pillar 2, but does not expect it to materially affect its effective income tax rate[155] - Compliance with a secured net leverage ratio not exceeding 4.25 to 1.00 as of September 30, 2024[181] Cash Flow and Financing - $931.7 million cash provided by operating activities for the year ended September 30, 2024, an increase of$ 181.4 million compared to $750.3 million in 2023[175] - Cash used in investing activities was$ 677.5 million in fiscal 2024, primarily due to capital expenditures of $429.5 million and net cash payments of$ 248.1 million related to acquisitions[176] - Cash provided by financing activities was $415.6 million in fiscal 2024, including proceeds of$ 1,200.0 million from the issuance of 6.375% senior notes and $1,000.0 million from 6.25% senior secured notes[178] - Total net repayments of debt amounted to$ 2,041.6 million in fiscal 2024, including repayments of $1,003.4 million on senior notes and$ 400.0 million on the Fourth Incremental Term Loan[178] Share Repurchase - $303.1 million spent on repurchasing 3.0 million shares of common stock at an average price of$ 101.74 per share[175] - $387.1 million spent on repurchasing 4.4 million shares of common stock in fiscal 2023 at an average price of$ 87.13 per share[179] Goodwill and Fair Value - No goodwill impairment charges were recorded for the year ended September 30, 2024, compared to a charge of $42.2 million in the prior year[165] - The estimated fair value of indefinite-lived trademarks and brands exceeded book value by 9% or greater at September 30, 2024[188] - Goodwill for the Cheese and Dairy and Weetabix reporting units exceeded carrying values by approximately 5.3% and 5.2%, respectively, as of September 30, 2024[190] - A goodwill impairment charge of$ 42.2 million was recorded in fiscal 2023 related to the Cheese and Dairy reporting unit due to narrowing pricing gaps and declining profitability[190] Market Conditions - The company experienced inflationary pressures on input costs and shifting consumer preferences towards private label products, impacting sales volumes in several segments[144] - Input cost inflation during fiscal 2023 pressured profit margins, which were largely mitigated through pricing actions, cost savings measures, and hedging programs[182] - The company expects inflationary pressures on certain input costs to ease in fiscal 2024, while others will continue to face inflation, impacting future operations[182] - Demand for certain products is influenced by holidays and seasons, impacting customer spending patterns and promotional activities[182] - Consolidated net sales were positively affected by foreign currency exchange rates by less than 1% during the year ended September 30, 2024[183]