Dive Brief:
- AdvancePierre Foods Holdings, Inc. has filed paperwork for an initial public offering with the SEC. Rumors of this filing began late last year with a Bloomberg report.
- The company did not confirm the number of shares to be offered or the price range of the stock. AdvancePierre set a placeholder offering of $100 million, according to reports.
- Barclays, Credit Suisse, and Morgan Stanley are underwriters for the offering.
Dive Insight:
AdvancePierre's fiscal 2015 revenue, at $1.61 billion, was a slight uptick from $1.58 billion in fiscal 2014. But profitability is where the company saw the most success in the past year, having improved its net income from a $37.9 million loss in fiscal 2014 to a $37.1 million gain in fiscal 2015.
In fiscal 2015, more than two-thirds (67.4%) of net sales came from the ready-to-eat sandwiches and sandwich components categories, both of which have seen significant growth in recent years. AdvancePierre sells these products under commercial and retail brands, but also private label and licensed brands.
With an infusion of cash from an IPO, AdvancePierre could move to expand its relatively small consumer-facing brands, including Barber Foods and Smart Picks. The company may also invest in marketing and innovation for the fast-growing RTE sandwich category, including its Hot 'n' Ready brand, which is capitalizing on consumers' demand for convenience.
Concerns have surrounded this IPO because of the market's volatility and the underwhelming performance of other recent category IPOs, such as Amplify Snack Brands, owner of SkinnyPop.