Simply Good Foods sees FY26 net sales down 2% to up 2%

Reaffirms Fiscal Year 2026 Outlook: Net sales expected to range between -2% and +2% year-over-year; Gross margins expected to decline between 100 and 150 basis points year-over-year; Adjusted EBITDA expected to range between -4% and +1% year-over-year. The company said, “The Company’s outlook continues to assume an increase in marketing spending for Quest and OWYN, including a significant increase in support for the OWYN brand intended to increase trial and build awareness. Management is focused on long-term growth for the total Company and will look to provide more fuel for growth should it find the opportunity to do so. Consistent with its previously provided outlook, the Company expects the second half of the fiscal year to be stronger on both the top and bottom line than the first half. Continued innovation and distribution-driven growth from Quest and OWYN across the year are expected to be offset by challenges for Atkins, with the timing of price elasticity and lapping of certain year-ago promotional events expected to reflect incremental headwinds to growth in the first half of the year, particularly in Q2 which the Company continues to expect will be its weakest net sales growth quarter of the year. Declines for gross margins and Adjusted EBITDA, and the phasing of profit growth for the year, are expected to primarily reflect the timing lag between elevated inflation and tariff expenses in the first half and building benefits from productivity, pricing, and improved costs expected in the second half of the year. As a result, the Company expects year-over-year margin expansion and Adjusted EBITDA growth to begin in the third quarter and build through the end of the fiscal year. Finally, with the increase to the Company’s term loan balance and to account for the Company’s fiscal year-to-date share repurchases, the Company now expects net interest expense to be in the range of $19M to $21M, and a weighted average diluted share count of approximately 96 million shares. The Company continues to expect the effective tax rate to be approximately 25%.”