Vital Farms reports Q1 EPS (3c), consensus 6c

Reports Q1 revenue $187.2M, consensus $182.4M. “Our first quarter performance fell short of expectations, as the anticipated changes in industry pricing and promotional dynamics in the outdoor access egg subcategory had a much greater impact on our velocities than we expected,” said Russell Diez-Canseco, Vital Farms (VITL)’ Executive Chairperson, President and CEO. “We are acting with urgency to restore volume growth by narrowing price gaps versus other outdoor access eggs, which we believe will help reaccelerate our velocities. We are streamlining our cost structure and reducing our CapEx this year to better align our operating model with the current environment. To be clear: this is a reset of the year, not a reset of ambition. While the near-term environment requires greater discipline, we believe the core fundamentals of the Vital Farms business remain intact, as evidenced by the distribution gains we have already secured for this year. Additionally, following a comprehensive review process, we have made the strategic decision to wind down the butter business. This decision was driven by increased complexity in our international supply chain and more volatile economics. Exiting butter will allow us to focus on our core egg categories, where we have the greatest competitive advantages and see the strongest path to long-term value creation at this time.”