The Marzetti (MZTI) Q2 2026 earnings summary

Executive summary

• Consolidated net sales rose 1.7% year-over-year to $518.0 million; adjusted for non-core TSA sales, net sales increased 0.1% to $509.8 million.

• Gross profit reached a quarterly record of $137.3 million, with gross margin improving 40 basis points to 26.5%.

• Diluted EPS increased 20.8% to $2.15, aided by the absence of prior year pension settlement charges.

• Announced a definitive agreement to acquire Bachan’s, a Japanese-American barbecue sauce brand, for $400 million in cash, expected to be immediately accretive to growth and margins.

• Operating income for the quarter was $75.2 million, down 0.6% due to higher SG&A and restructuring charges; adjusted operating income was $76.9 million.

Financial highlights

• Adjusted gross margin improved 80 basis points to 26.9% due to cost savings and inflationary pricing.

• SG&A expenses increased 5.8% to $60.4 million, mainly from higher marketing spend and new product launches.

• Temporary supply agreement with Winland Foods added $8.2 million in non-core sales, expected to end by March 2026.

• Operating cash flow for the first half grew $30.6 million, or 24%, reaching $158.1 million.

• Dividend increased 5% to $1 per share, marking 63 consecutive years of increases; $20.1 million in share repurchases.

Outlook and guidance

• Projecting low single-digit volume growth in retail for the remainder of the year, with some sales pulled forward into Q3 due to an earlier Easter.

• Foodservice segment expected to see continued growth from national accounts, with industry conditions expected to remain flat or modestly improve.

• Modest input cost inflation anticipated, to be offset by contractual pricing and cost savings initiatives.

• Capital expenditures forecasted at $75–$85 million for fiscal 2026.

• Bachan’s acquisition will be funded with cash and additional financing; details to be provided in a future filing.