Central Garden & Pet Company (CENT) Q3 2026 earnings summary

Executive summary

• Organic sales grew 2% year-over-year, with operating and gross margins expanding, driven by strong execution in both Pet and Garden segments and supported by recent product innovations.

• Project Horizon, a multi-year logistics modernization, is 95% complete, consolidating logistics, closing 13 facilities, and delivering improved productivity and service under budget.

• Announced acquisition of an 80% stake in TRIXIE, a leading European pet supplies company, for up to €400M, to expand international presence and enhance long-term growth.

• Raised fiscal 2026 non-GAAP diluted EPS guidance to $2.85 or better, reflecting strong year-to-date performance and margin discipline.

• Net sales for Q3 FY26 declined 8% to $882M due to the exit of the pet distribution business, but organic net sales rose 2% to $862M.

Financial highlights

• Net sales: $882M (down 8% YoY); organic net sales: $862M (up 2% YoY).

• Non-GAAP gross profit: $318M (down 4%); gross margin up 140 bps to 36%.

• Non-GAAP operating income: $136M (down 2%); operating margin up 90 bps to 15.4%.

• Non-GAAP net income: $96M (down 2%); non-GAAP diluted EPS: $1.54 (down $0.02 YoY).

• Adjusted EBITDA: $162M (down $5M YoY); margin expanded to 18.3%.

Outlook and guidance

• Fiscal 2026 non-GAAP diluted EPS guidance raised to $2.85 or better, excluding future acquisitions and divestitures.

• TRIXIE acquisition expected to close in H1 fiscal 2027, contributing incremental sales and earnings.

• Capital expenditures for fiscal 2026 projected at ~$50M, focused on maintenance, productivity, and targeted growth.

• Guidance assumes a competitive retail environment, value-oriented consumer, existing tariffs, and stable key commodities.

• Long-term organic growth targets: Pet 1%-4%, Garden 1%-2%.