The continued growth in demand for private label products was key to the strong second quarter sales growth at TreeHouse Foods. But despite the double-digit rise in sales, the company also reported an increase in its net loss for the quarter ended June 30.
Net sales increased 19.4% to $1.2 billion when compared to the second quarter of 2021. Net loss from continuing operations was $(30.6) million, an increase when compared to the comparable quarter the previous year when the company reported a net loss of $(5.2) million. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) from continuing operations was $66.5 million in the second quarter of 2022 compared to $92.6 million in the second quarter of 2021.
The decrease in adjusted EBITDA was primarily due to incremental costs related to labor and supply chain disruption and commodity and freight cost inflation, which was partially offset by favorable pricing actions to recover inflation. The declines were partially offset by favorable category mix and favorable fixed cost overhead absorption due to higher volume.
"The value proposition of private label is becoming increasingly important as consumers navigate this inflationary environment,” said Steve Oakland, president and CEO of TreeHouse. “In addition, the breadth of the retail landscape, improved quality and assortment, and our customers' strategic commitment to private label are driving trial and share gains."
Patrick O’Donnell, interim chief financial officer and chief accounting officer, added that the company is encouraged by robust demand for private label food and beverage and are working to improve service and execute pricing to recover inflation.
“Despite ongoing challenges related to labor and materials availability, we continue to make gradual progress toward improving profitability and believe we are on track to deliver our full-year guidance,” he said.
By product segment, net sales in Meal Preparation increased $118.3 million, or 18.3% in the second quarter. Net sales in the Snacking & Beverage segment increased $76.1 million, or 21.4%