Freshpet (FRPT) investor relations material

Executive summary

• Net sales grew 13.1% year-over-year to $297.6 million in Q1 2026, driven by volume gains, manufacturing scale, and omnichannel expansion.

• Net income reached $48.5 million, reversing a net loss last year, primarily due to a $62.0 million gain on the sale of an equity investment and higher sales.

• Adjusted EBITDA increased to $37.9 million, up $2.4 million year-over-year, with margin at 12.7%.

• Household penetration rose to 16.1 million, up 8% year-over-year, with buy rate up 6%.

• Digital orders grew 43% year-over-year, now 16.1% of total business.

Financial highlights

• Gross profit was $120.7 million (40.5% of net sales), up from $103.8 million (39.4%) year-over-year.

• Adjusted gross margin improved to 46.9% from 45.7% year-over-year.

• Free cash flow for Q1 was $12.7 million, compared to negative $21.7 million in the prior year.

• Cash and cash equivalents rose to $381.4 million, mainly from the equity investment sale.

• SG&A expenses were $116.3 million (39.1% of net sales), down as a percentage from 43.8% year-over-year.

Outlook and guidance

• Net sales growth guidance for 2026 raised to 8%-11% year-over-year.

• Adjusted EBITDA guidance remains $205M-$215M, up 5%-10% year-over-year.

• Capital expenditures projected at $150M for 2026, focused on plant expansion and operational efficiency.

• Free cash flow positive expected in 2026.

• Expect adjusted gross margin to improve by 50-100 bps at midpoint of sales range.