Dive Brief:
- Post Holdings reported a 0.1% increase in net sales to $1.25 billion for the fiscal first quarter 2017, although net sales declined 2.2% when compared to the same period in fiscal 2016, according to a company release.
- The company also reported net earnings of $97.6 million and showed an operating profit of $76.3 million.
- Gross profit for Post came in at $379.2 million, which was 30.3% of net sales, showing an increase of $16.7 million year over year. Meanwhile, operating profit was $76.2 million, a decrease of 42.7% (or $56.7 million) from 2016.
Dive Insight:
The Post Consumer Brands segment, which includes its ready-to-eat cereal business, saw net sales increase 2.2% to $420.6 million, thanks in large part to an increase in sales of Malt-O-Meal branded bags, Pebbles and Honey Bunches of Oats.
By introducing cinnamon-flavored Pebbles to the market, the company is experimenting with new tastes in an effort to keep both new and old customers happy. It also added new flavors to its line of Malt-O-Meal products, delivering on its promise to increase the brand’s presence when Post acquired the company in 2015.
The company has also changed up some of its packaging, most notably on its Better Oats brand, and added a built-in measuring pouch in select products to add convenience for the consumer. Both initiatives were designed to attract millennial customers.
After-effects of 2015's avian influenza epidemic continued to haunt Post's Michael Foods Group, with egg sales down 12.8%. The amount of eggs sold was actually up 11.8% — though the avian-influenza-related shortage earlier in the year skews the figures.
Going into 2017, Post said it expects to spend $180 million to $200 million on capital expenditures. A large chunk of that — $25 million to $35 million — is for a cage-free eggs facility in Nebraska.