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05/10/2022

TreeHouse Sees Net Sales Increase in Q1 2022

The first financial report of the year showed strong results for TreeHouse Foods including increased demand for private label products.
Zachary Russell
Associate Editor
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Private label food and beverage manufacturer TreeHouse Foods has shared its financial report from the first quarter of 2022. The Oak Brook, Ill.-based company shared strong results compared to the same period last year.

“I'm proud of our strong execution in this dynamic environment," said Bill Kelley, EVP and chief financial officer at TreeHouse. "We delivered strong first quarter net sales growth of 7.9%; our pricing initiatives to recover inflation were successful and contributed low-double digit growth as expected; and our progress around improving service enabled us to capture incremental private label volume. Our first quarter performance positions us to be on track to deliver improved profitability in 2022, and we are reaffirming our full year guidance."

In Q1, net sales were $1.14 billion, an increase of 7.9% compared to the same period in 2021, which TreeHouse says was driven by favorable pricing to partially recover commodity and freight cost inflation. Gross profit as a percentage of net sales was 13.6% in the first quarter of 2022, compared to 17.1% in the first quarter of 2021, a decrease of 3.5 percentage points, due to commodity inflation.

Net sales in the snacking & beverages segment increased $34.1 million, or 9.0%, in the first quarter of 2022 compared to the first quarter of 2021, which the company said was due to increasing private label demand. Net sales in the meal preparation segment increased $49.6 million, or 7.3%, in the first quarter of 2022 compared to the first quarter of 2021. 

"The private label proposition is becoming increasingly important to our customers and their consumers as they manage a higher cost macro environment and seek better value," said Steve Oakland, CEO and president of TreeHouse Foods. "This has translated into private label consumption growth and unit share gains in measured channels, and in the first quarter, we outpaced the broader private label market in eight of our ten largest categories."

TreeHouse reaffirmed its full year 2022 guidance expectations of net sales growth of at least 11% year-over-year and adjusted EBITDA of $385 to $415 million. Treehouse Foods operates in 29 product categories across two divisions and has approximately 40 production facilities across North America and Italy.