PREMIUM BRANDS HOLDINGS CORPORATION REPORTS RECORD SECOND QUARTER SALES, ADJUSTED EBITDA AND ADJUSTED EARNINGS AND DECLARES THIRD QUARTER DIVIDEND
PREMIUM BRANDS HOLDINGS CORPORATION REPORTS RECORD SECOND QUARTER SALES, ADJUSTED EBITDA AND ADJUSTED EARNINGS AND DECLARES THIRD QUARTER DIVIDEND |
| [06-August-2026] |
VANCOUVER, BC, Aug. 6, 2026 /CNW/ -- Premium Brands Holdings Corporation (TSX: PBH), a leading producer, marketer and distributor of branded specialty food products, announced today its results for the second quarter of 2026. QUARTER HIGHLIGHTS
QUESTIONS AND ANSWERS SESSION The Company will hold a Q&A session on its second quarter 2026 results today at 10:30 a.m. Vancouver time (1:30 p.m. Toronto time). Management's pre-recorded remarks and an investor presentation that will be referenced on the conference call are available here or by navigating through the Company's website at www.premiumbrandsholdings.com. Access to the Q&A session may be obtained by calling the operator at (289) 514-5100 or (800) 717-1738 (Conference ID: 65485) up to ten minutes prior to the scheduled start time. For those who are unable to participate, a recording of the conference call will be available through to 11:59 p.m. Toronto time on September 6, 2026 at (289) 819-1325 or (888) 660-6264 (passcode: 65485#). Alternatively, a recording of the conference call will be available on the Company's website at www.premiumbrandsholdings.com. SUMMARY FINANCIAL INFORMATION
"Our second quarter results provide an early indication of our earnings and cash flow potential as the investments we have made in recent years to position our company to benefit from fundamental changes occurring in the food industry begin to generate returns. Our sales grew by 26.3%, including 7.5% organic growth, our adjusted EBITDA and earnings per share grew by 29.5% and 17.7%, respectively, our total debt-to-EBITDA ratio fell to 3.8 : 1, and we are now once again generating solid net free cash flow," said Mr. George Paleologou, President and CEO. "As outlined in my recently published letter to shareholders titled "A New Food Order", consumers' growing focus on health and wellness, along with their evolving sophistication in measuring and tracking personal health data, is disrupting the food universe in unprecedented ways. Our portfolio of best-in-class premium food products that cater to three key mega food trends, namely high in protein, convenience and premiumization, combined with our new state-of-the-art production capacities and innovation capabilities, uniquely position us to capitalize on this disruption," added Mr. Paleologou. "On the acquisitions front, we are evaluating several attractive opportunities, however, any transaction we complete will be done within the context of continuing to strengthen our financial position," stated Mr. Paleologou. THIRD QUARTER 2026 DIVIDEND The Company also announced that its Board of Directors approved a cash dividend of $0.85 per common share for the third quarter of 2026, which will be payable on October 15, 2026 to shareholders of record at the close of business on September 30, 2026. Unless indicated otherwise in writing at or before the time the dividend is paid, each dividend paid by the Company in 2026 or a subsequent year is an eligible dividend for the purposes of the Enhanced Dividend Tax Credit System. ABOUT PREMIUM BRANDS Premium Brands owns a broad range of leading specialty food manufacturing and differentiated food distribution businesses with operations across Canada and the United States. RESULTS OF OPERATIONS The Company reports on two reportable segments, Specialty Foods and Premium Food Distribution, as well as non-segmented investment income and corporate costs (Corporate). The Specialty Foods segment consists of the Company's specialty food manufacturing businesses while the Premium Food Distribution segment consists of the Company's differentiated distribution and wholesale businesses as well as certain seafood processing businesses. Investment income includes interest and management fees generated from the Company's businesses that are accounted for using the equity method As part of the realignment of certain businesses and management responsibilities, starting in fiscal 2026 the Company reclassified certain businesses from the Premium Food Distribution segment to the Specialty Foods segment. Accordingly, segmented information for the comparative period has been retrospectively restated. As a result of the sale of the Company's Shaw Bakers business on April 24, 2026 and the planned sale of its Duso's business, it has retroactively presented the operations of these businesses as discontinued operations in accordance with IFRS Accounting Standards. Correspondingly, these discontinued operations no longer contribute to revenue or earnings from continuing operations. Management believes this accounting method for these businesses enhances the comparability and relevance of current period operating results by allowing readers of the press release to independently evaluate the Company's continuing operations. Revenue
Specialty Foods' (SF) revenue for the quarter increased by $469.1 million or 36.7% primarily due to: (i) business acquisitions, which generated $354.5 million in growth; (ii) organic volume growth of $77.2 million representing an organic volume growth rate (OVGR) of 6.0%; (iii) selling price increases of $31.7 million, which were primarily in response to higher beef raw material costs; and (iv) a $5.7 million increase in the translated value of sales generated by SF's U.S. based businesses due to a weaker Canadian dollar. SF's OVGR of 6.0% was driven by: (i) a variety of protein and sandwich growth initiatives in the U.S. which generated organic volume growth of $82.4 million, representing an OVGR of 10.7%, despite a large limited-time sandwich promotion by a customer ending in the fourth quarter of 2025 and the replacement promotions not scheduled to launch until 2027 (see Forward Looking Statements); and (ii) 1.5% organic volume growth in the Canadian market which was lower than expected due to several issues including poor weather in Eastern Canada that limited outdoor activities. These factors were partially offset by a decline in beef jerky sales as this product category continues to be challenged by several issues including record high beef prices and consumer price sensitivity. SF's revenue for the first two quarters of 2026 increased by $833.0 million or 34.4% primarily due to: (i) business acquisitions, which generated $635.0 million in growth; (ii) organic volume growth of $146.6 million representing an OVGR of 6.1%; and (iii) selling price increases of $72.0 million. These factors were partially offset by a $20.6 million decrease in the translated value of sales generated by SF's U.S. based businesses due to a stronger Canadian dollar. Premium Food Distribution's (PFD) revenue for the quarter increased by $25.9 million or 4.3% due to: (i) selling price increases of $28.2 million, which were primarily in response to higher beef raw material costs; and (ii) a $0.4 million increase in the translated value of sales generated by PFD's U.S. based businesses due to a weaker Canadian dollar. These factors were partially offset by a $2.7 million sales volume contraction. PFD's sales volume contraction was primarily due to weaker consumer demand in certain segments of the Canadian foodservice channel; partially offset by stronger trading sales, mainly of imported beef products. PFD's revenue for the first two quarters of 2026 increased by $67.1 million or 6.1% primarily due to: (i) selling price increases of $46.4 million; and (ii) organic volume growth of $22.4 million representing an OVGR of 2.0%. These increases were partially offset by a $1.7 million decrease in the translated value of sales generated by PFD's U.S. based businesses due to a stronger Canadian dollar. Gross Profit
SF's gross profit as a percentage of its revenue (gross margin) for the quarter decreased by 110 basis points primarily due to: (i) the acquisition of Stampede Culinary Partners, which has a lower gross margin as compared to the average of SF's legacy businesses - excluding acquisitions, SF's gross margin for the quarter was 20.9%; and (ii) increased plant overhead costs associated with new capacity investments and adding production shifts at several facilities. These factors were partially offset by: (i) the implementation of selling price increases to address the impact of higher raw material costs and general cost inflation; and (ii) sales leveraging benefits associated with SF's organic volume growth. SF's gross margin for the first two quarters of 2026 decreased by 70.00 basis points primarily due to the same factors that impacted the current quarter. PFD's gross margin for the quarter decreased by 90 basis points primarily due to the impact of commodity cost inflation (mainly on beef products) as PFD's businesses generally focused on recovery of gross profit dollars due to the severity of the cost inflation combined with weaker consumer demand in certain segments of the foodservice channel. PFD's gross margin for the first two quarters of 2026 decreased by 100 basis points primarily due to the same factors that impacted the current quarter, and a year-over-year reduction in margins on lobster products in the first quarter of 2026 resulting from a combination of high shore purchase prices and consumer price sensitivity. Selling, General and Administrative Expenses (SG&A)
SF's SG&A as a percentage of sales (SG&A ratio) for the quarter and for first two quarters of 2026 decreased by 150 basis points and 110 basis points respectively, primarily due to: (i) the acquisition of Stampede Culinary Partners, which has a lower SG&A ratio as compared to the average of SF's legacy businesses; and (ii) sales growth leverage. In the first quarter of 2026, these factors were partially offset by an increase in promotional activity. PFD's SG&A ratio for the quarter decreased by 50 basis points primarily due to lower discretionary compensation accruals. PFD's SG&A ratio for the first two quarters of 2026 decreased by 30 basis points primarily due to: (i) sales growth leverage; and (ii) lower discretionary compensation accruals. Adjusted EBITDA (1)
Plant Start-up and Restructuring Costs Plant start-up and restructuring costs consist of expenses associated with: (i) the start-up of new production capacity; (ii) the reconfiguration of existing capacity to gain efficiencies and/or additional capacity; and/or (iii) the restructuring of a business to improve its profitability. The Company expects these investments to result in improvements in its future earnings and cash flows (see Forward Looking Statements). During the quarter, the Company incurred $4.8 million in plant start-up and restructuring costs relating mainly to the start-up of a new 352,000 square foot sandwich production facility in Cleveland, TN. Equity Earnings (Losses) from Investments in Associates Equity earnings (losses) from investments in associates includes the Company's proportionate share of the earnings and losses of its investments in associates.
Clearwater Seafoods Incorporated (Clearwater) Clearwater's total revenue, including discontinued operations, for the second quarter of 2026 as compared to the second quarter of 2025 decreased by $46.4 million primarily due to: (i) the sale of its Macduff land-based operations in the third quarter of 2025; (ii) the sale of its Argentine scallop business in the latter part of the quarter; and (iii) Canadian scallop catch rates being significantly below five-year average levels due to natural fluctuations in the available biomass. These factors were partially offset by improved pricing on most of Clearwater's core species. Clearwater's loss before payments to shareholders for the second quarter of 2026 as compared to the second quarter of 2025 improved by $5.2 million primarily due to: (i) high restructuring costs in the second quarter of 2025 associated with Clearwater's exit from its onshore lobster operations and the sale of its Macduff land based operations; and (ii) a slight improvement in earnings from its core Canadian fisheries as the benefit of higher prices more than offset the impact of lower sales volumes. Clearwater's net loss increased by $25.6 million primarily due to the payment of a $30.0 million fee to the Company with respect to certain lobster related assets and sales; partially offset by the improvement in its loss before shareholder related expenses. Other Losses (Gains) The Company recorded a loss of $53.1 million ($39.1 million after tax recoveries) in connection with the shutdown of a value-added beef processing facility in Ontario and the associated exit from certain unprofitable sales. The loss consists of $50.6 million in non-cash asset write downs and $2.5 million for various other costs including severance. The impact of the costs associated with the value-added beef plant shutdown were partially offset by a $30.0 million fee paid to the Company by Clearwater with respect to certain lobster related assets and sales. Revenue and Adjusted EBITDA Outlook See Forward Looking Statements for a discussion of the risks and assumptions associated with forward looking statements. 2026 Outlook
The Company revised its 2026 revenue guidance based primarily on: (i) delays in certain new product launches including a customer's decision to push several large promotions originally planned for the second half of 2026 out to early 2027; (ii) exiting unprofitable sales in conjunction with the shutdown of a value-added beef processing facility in Ontario (see Results of Operations - Other Losses (Gains)); and (iii) weakening consumer demand in certain segments of the foodservice channel. The Company revised its 2026 adjusted EBITDA guidance based primarily on its sales reforecast and did not adjust for any benefits associated with potential decreases in raw material beef costs. 5 Year Plan The Company has a strong pipeline of sales opportunities and expects to exceed the five-year targets shown in the table below, which were set at the beginning of 2023, without any further acquisitions (see Forward Looking Statements).
NON-IFRS FINANCIAL MEASURES The Company uses certain non-IFRS financial measures including adjusted EBITDA, steady state free cash flow, adjusted earnings and adjusted earnings per share, which are not defined under IFRS and, as a result, may not be comparable to similarly titled measures presented by other publicly traded entities, nor should they be construed as an alternative to other earnings measures determined in accordance with IFRS. These non-IFRS measures are calculated as follows: Adjusted EBITDA
Steady State Free Cash Flow (SSFCF)
Adjusted Earnings and Adjusted Earnings per Share
FORWARD LOOKING STATEMENTS This press release contains forward looking statements with respect to the Company, including, without limitation, statements regarding its business operations, strategy and financial performance and condition, cash distributions, proposed acquisitions, budgets, projected costs and plans and objectives of or involving the Company. While management believes that the expectations reflected in such forward looking statements are reasonable and represent the Company's internal expectations and belief as of August 6, 2026, there can be no assurance that such expectations will prove to be correct as such forward looking statements involve unknown risks and uncertainties beyond the Company's control which may cause its actual performance and results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward looking statements. Forward looking statements generally can be identified by the use of the words "may", "could", "should", "would", "will", "expect", "intend", "plan", "estimate", "project", "anticipate", "believe" or "continue", or the negative thereof or similar variations. Forward looking statements in this press release include statements with respect to the Company's expectations and/or projections on its: outlook and 5-year plan; consumers' preferences; margins, sales and operational initiatives; revenue and earnings; cash flow; operational efficiencies; gross profit; adjusted EBITDA; plant start-up and restructuring costs; business acquisitions and divestitures; financial performance and results; and risks and uncertainties. Some of the factors that could cause actual results to differ materially from the Company's expectations are outlined below under the Risks and Uncertainties section in the Company's Management Discussion & Analysis for the 26 weeks ended June 27, 2026. Assumptions used by the Company to develop forward looking statements contained or incorporated by reference in this press release are based on information currently available to it and include those outlined below as well as those outlined elsewhere in this document. Readers are cautioned that this information is not exhaustive.
Management has set out the above summary of assumptions related to forward looking statements included in this press release to provide a more complete perspective on the Company's future operations. Readers are cautioned that this press release may not be appropriate for other purposes. Unless otherwise indicated, the forward looking statements in this press release are made as of August 6, 2026 and, except as required by applicable law, will not be publicly updated or revised. This cautionary statement expressly qualifies the forward looking statements in this press release. SOURCE Premium Brands Holdings Corporation | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Company Codes: Toronto:PBH | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
