What changed in this filing

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Item 7. Management’s Discussion and Analysis

2025-11-26 compared with 2024-11-27 · 133 added, 221 removed, 318 unchanged (53% of the section changed)

12 unchanged sentences

• Net sales for fiscal 2025 decreased $71.4 million, or 2.2%, to $3.1 billion.

Organic net sales decreased 3.9% with Pet organic sales decreasing 5.9% and Garden organic sales decreasing 1.2%.

• Gross profit for fiscal 2024 declined $3.1 million, or 0.3%, to $943.7 million while gross margin increased 90 basis points in fiscal 2024 to 29.5%, from 28.6% in fiscal 2023.

Pet net sales decreased $30.8 million, or 1.7%, and Garden net sales decreased $40.6 million, or 3.0%.

• Gross profit for fiscal 2025 increased $53.6 million, or 5.7%, to $997.3 million and gross margin increased 240 basis points in fiscal 2025 to 31.9%, from 29.5% in fiscal 2024.

On a non-GAAP basis, gross margin increased 210 basis points in fiscal 2025.

• Our operating income declined $25.3 million, or 12.0%, to $185.4 million in fiscal 2024.

On a non-GAAP basis, operating income declined $4.4 million in fiscal 2024.

• Our operating income increased $64.7 million, or 34.9%, to $250.0 million in fiscal 2025.

On a non-GAAP basis, operating income increased $42.2 million, or 19.0%, in fiscal 2025.

• Net income for fiscal 2025 was $162.8 million, or $2.55 per share on a diluted basis compared to $108.0 million, or $1.62 per share on a diluted basis in fiscal 2024.

1 unchanged sentence

Recent Developments:

Cost and Simplicity program - Facility Closures and Business Exit

The following activities reflect our ongoing network optimization initiative to achieve a simpler, more efficient manufacturing and distribution network.

In our Pet segment, during the fourth quarter of fiscal year 2024, as part of our Cost and Simplicity program we decided to close a manufacturing facility in California, which we plan to exit in June 2025, and a facility in Arizona, which we plan to exit in January 2025.

The associated pet bed, outdoor cushion and durable pet supply manufacturing and distribution activities will be transitioned to Central facilities in Indiana and North Carolina.

As a result, we incurred approximately $7.5 million of one-time costs, including $5.2 million in cost of goods sold and $2.3 million in selling, general and administrative costs, comprised of charges for facility closures, the impairment of inventory and severance, the majority of which were non-cash.

Additionally, related to the pet supplies business activities being transitioned, we recognized a non-cash impairment charge of $12.8 million related to the impairment of intangible assets due primarily to changing market conditions resulting from the decline in demand for durable products and increased international competition.

In our Garden segment, during the fourth quarter of fiscal year 2024, we recognized incremental expense of $3.9 million in selling, general and administrative expenses, related to facility closures and business exits announced in fiscal 2023 and earlier in fiscal 2024.

In our Garden segment, during the third quarter of fiscal year 2024, as part of our Cost and Simplicity program and in response to changing market conditions, we decided to exit the pottery business which we expect to be completed by calendar year-end 2025.

Additionally, we closed a live goods distribution facility in Delaware and relocated our grass seed research facility from Oregon to Texas.

As a result, in fiscal 2024 we incurred approximately $10.9 million of one-time costs, including $8.6 million in cost of goods sold and $2.3 million in selling, general and administrative costs, comprised of charges for the impairment of inventory and facility closures, the majority of which were non-cash.

In our Garden segment, during the second quarter of fiscal year 2024, as part of our Cost and Simplicity program we decided to close a manufacturing facility in California.

Additionally, in the second quarter, we began the Southeast consolidation of four distribution locations into one new modern facility, which we expect to be completed by calendar year-end.

As a result, we incurred approximately $5.3 million of one-time costs, including $2.5 million in cost of goods sold and $2.8 million in selling, general and administrative costs, comprised of charges for facility closures, severance, and impairment of inventory, the majority of which were non-cash.

Litigation Settlement Gain and Investment Impairment

Within corporate, we recognized a gain of $3.2 million during the fourth quarter of fiscal 2024, for the settlement of litigation, which is included in selling, general and administrative expense.

Additionally, we recognized a $7.5 million non-cash impairment charge for two related private company investments that is included within Other income (expense) in the consolidated statement of operations.

Stock Dividend

In December 2023, our Board of Directors approved a stock dividend in the form of one share of the Company's Class A Common Stock for every four outstanding shares of its Common Stock, Class A Common Stock and Class B Stock, which shares were distributed on February 8, 2024, to stockholders of record as of January 8, 2024.

The stock dividend did not affect the number of the Company's authorized shares and the par value of each share of stock remained unchanged.

Proportionate adjustments were made to the per share exercise price and/or the number of shares issuable upon the exercise or vesting of all stock options, restricted stock and performance share units outstanding at January 8, 2024, which resulted in a proportional increase in the vesting of such stock options, restricted stock and performance share units, and, in the case of stock options, a proportional decrease in the exercise price of all such stock options.

Unless noted, all Class A Common share and per share amounts contained in this Form 10-K have been retroactively adjusted to reflect the one-for-four stock dividend.

Fiscal 2024 Acquisition

In November 2023, we acquired TDBBS, LLC (“TDBBS”), a provider of premium natural dog chews and treats for approximately $60 million.

The addition of TDBBS expands our portfolio with bully and collagen sticks, bones and jerky, adds scale to our dog and cat business and enhances our eCommerce and direct-to-consumer capabilities.

Wind-down of U.K.

In March 2025, we decided to wind-down our operations in the United Kingdom, which also served certain European markets, and move to a direct-export model.

During fiscal 2025, we incurred approximately $10.0 million of one-time closure costs, including $5.6 million in cost of goods sold and $4.4 million in selling, general and administrative expense.

The amounts were primarily related to the liquidation of inventory and receivables, severance and legal costs.

Facility Closures

During fiscal 2025, we began the consolidation of two legacy distribution facilities in Ontario, California and Salt Lake City, Utah into a new modern facility in Salt Lake City, Utah, reflecting our ongoing network optimization initiative to achieve a simpler, more efficient distribution network.

As a result, we recognized $5.0 million in selling, general and administrative expense, composed primarily of charges for lease and severance costs.

Fiscal 2025 Stock Repurchases

Since our fiscal year ended September 28, 2024 through November 21, 2024, we repurchased 1.3 million shares of our non-voting common stock (CENTA) and 0.4 million shares of our voting common stock (CENT) on the open market at an aggregate cost of $51.7 million.

As of November 21, 2024, we had $30.3 million remaining under our 2019 Repurchase Authorization.

During fiscal 2025, we repurchased 3.2 million shares of our non-voting common stock (CENTA) and 1.4 million shares of our voting common stock (CENT) on the open market at an aggregate cost of $148.4 million.

As of September 27, 2025, we had $46.5 million remaining under our 2024 Repurchase Authorization.

On July 4, 2025, H.R.

1, commonly known as the “One Big Beautiful Bill Act” (the “OBBBA”), was enacted into law.

The OBBBA contains numerous federal tax provisions including modifications to the capitalization of research and development expenses, limitations on deductions for interest expense, and accelerated fixed asset depreciation.

Because the OBBBA was enacted during fiscal 2025, we have

reflected the impact of the provisions that were effective during the year in our income tax provision.

The impact of the OBBBA on our fiscal 2025 consolidated financial statements was not material.

We will continue to monitor the OBBBA and any related regulatory or interpretive guidance and will update our accounting in future periods as required.

Results of Operations (GAAP)

13 unchanged sentences

Net sales for fiscal 2025 decreased $71.4 million, or 2.2%, to $3,129.1 million from $3,200.5 million in fiscal 2024.

Fiscal 2024 included 52 weeks while fiscal 2023 included 53 weeks.

Our branded product sales, which include products we produce under Central brand names and products we produce under third-party brands, decreased $30.6 million, and sales of other manufacturers’ products decreased $40.8 million.

Sales of branded products represented approximately 78% of our net sales in both fiscal 2024 and fiscal 2023, and sales of other manufacturers' products represented 22% of our net sales.

Organic net sales, which exclude net sales from the acquisition of TDBBS in November 2023 and net sales from the independent garden channel distribution business we sold in the prior fiscal year, declined $127.9 million, or 3.9%, as compared to the prior fiscal year.

The decline in organic net sales was due primarily to lower Pet sales.

In fiscal 2025, sales of branded products represented approximately 79% of our net sales, compared to 78% in fiscal 2024, and sales of other manufacturers' products represented 21% of our net sales.

The following table indicates each class of similar products which represented approximately 10% or more of our consolidated net sales in the fiscal years presented:

8 unchanged sentences

Pet net sales decreased $30.8 million, or 1.7%, to $1,802.0 million in fiscal 2025 from $1,832.8 million in fiscal 2024.

Pet organic sales, which exclude net sales from the acquisition of TDBBS in November 2023, declined $110.8 million.

Fiscal 2023 included an extra week compared to fiscal 2024.

The decline in Pet net sales was volume-related and due primarily to lower demand for durable pet products, particularly in our outdoor cushion business, aquatics business, and pet bed business.

The decline in Pet net sales was due primarily to lower sales of durable items impacting our outdoor cushions, pet beds and aquatics businesses.

These declines were partially offset by increased sales in our animal health business.

1 unchanged sentence

Garden net sales decreased $40.6 million, or 3.0%, to $1,327.1 million in fiscal 2025 from $1,367.7 million in fiscal 2024.

Garden organic sales, which exclude net sales from the independent garden channel distribution business sold in the fourth quarter of fiscal 2023, decreased $17.1 million, or 1.2%.

The Garden net sales decline was volume related and due primarily to lower sales in wild bird feed partially offset by increased sales in our controls and grass seed businesses.

Additionally, fiscal 2023 included an extra week compared to fiscal 2024.

Garden branded sales decreased $34.8 million, and sales of other manufacturers' products decreased $30.4 million.

Gross profit in fiscal 2024 decreased $3.1 million, or 0.3%, to $943.7 million from $946.8 million in fiscal 2023.

The decline in Garden net sales was due primarily to decreased sales of third-party products resulting from the loss of distribution of two product lines and our planned exit of the pottery business.

Increased sales of wild bird feed and private label products were partially offset by decreased sales in both our controls and live plants businesses due to cool and wet weather during the early part of the garden season.

Garden branded sales increased $5.4 million, and sales of other manufacturers' products decreased $46.0 million.

Gross profit in fiscal 2025 increased $53.6 million, or 5.7%, to $997.3 million from $943.7 million in fiscal 2024.

Gross margin improved 240 basis points to 31.9% in fiscal 2025 from 29.5% in fiscal 2024.

The decline in gross profit resulted from decreased Garden gross profit, partially offset by an increase in Pet.

The improved gross margin was due primarily to the higher gross margin in Pet partially offset by a lower gross margin in Garden.

Both segments were adversely impacted by fiscal 2024 facility closure projects under our Cost and Simplicity initiative.

On a non-GAAP basis, excluding the charges associated with the facility closures in fiscal 2024, gross profit increased $3.5 million and gross margin improved 110 basis points to 30.0% in fiscal 2024.

These increases were due primarily to the benefits resulting from Central's Cost and Simplicity program and lower inflation.

Both Pet and Garden benefitted from the results of the Cost and Simplicity program and lower inflation.

The increase in the Pet gross margin was partially offset by a lower gross margin, as compared to the prior fiscal year.

The decrease in Garden was due primarily to an approximately $19 million write-down of the value of our grass seed inventory due to a recent significant decrease in the market prices of grass seed and what we believe to be an industry-wide over supply of grass seed and lower sell through in our Live Goods business.

Pet and Garden both contributed to the increase in gross profit and gross margin.

Gross profit in Pet, in both fiscal 2024 and 2025, and Garden, in fiscal 2024, was impacted by facility closure projects under our Cost and Simplicity agenda.

On a non-GAAP basis, excluding approximately $6 million in charges associated with the facility closures in fiscal 2025 and approximately $16 million in fiscal 2024, gross profit increased $42.8 million and gross margin improved 210 basis points to 32.1% in fiscal 2025 from 30.0% in fiscal 2024.

The increase in gross profit and gross margin in Pet was due primarily to efficiency gains and structural improvements resulting from productivity initiatives under our Cost and Simplicity agenda and some commodity price deflation.

These improvements more than offset the impact of tariffs.

The increase in gross profit and gross margin in Garden was due primarily to improvements in our Live Goods business in fiscal 2025, from cost reduction initiatives under our Cost and Simplicity agenda and the adverse impact in fiscal 2024 from the write-down of the value of our grass seed inventory in fiscal 2024 of approximately $20 million, due to a significant decrease in the market prices of grass seed and an industry-wide over supply of grass seed.

Selling, General and Administrative

Selling, general and administrative expenses increased $22.1 million, or 3.0%, from $736.2 million in fiscal 2023 to $758.3 million in fiscal 2024.

Selling, general and administrative expenses decreased $11.0 million, or 1.5%, from $758.3 million in fiscal 2024 to $747.3 million in fiscal 2025.

As a percentage of net sales, selling, general and administrative expenses increased from 23.7% in fiscal 2024 to 23.9% in fiscal 2025.

The increase was due to $21.1 million in expense related to the closure of facilities in both the Pet and Garden segments and intangible asset impairments, partially offset by the gain from a litigation settlement.

Excluding these items and similar items in fiscal 2023, non-GAAP selling, general and administrative expense increased $7.9 million and increased as a percentage of net sales to 23.0% in fiscal 2024 compared from 22.0% in fiscal year 2023.

Selling and delivery expense increased $2.3 million, or 0.7%, to $339.8 million in fiscal 2024 and increased as a percentage of net sales from 10.2% in fiscal 2023 to 10.6% in fiscal 2024.

The increase in selling and delivery expense was in the Pet segment due primarily to our acquisition of TDBBS in November 2023.

Warehouse and administrative expense increased $19.8 million, or 5.0%, to $418.5 million in fiscal 2024 and increased as a percentage of net sales from 12.0% in fiscal 2023 to 13.1% in fiscal 2024.

The increase in warehouse and administrative expense was due to increases in both the Pet and the Garden segments, partially offset by lower corporate expense.

The increases in both the Pet and Garden segments were due primarily to the charges related to the closure of facilities, the exit of the pottery business and the impairment of intangible assets.

Excluding these expense items, warehouse and administrative expense increased $8.9 million in fiscal 2024 as compared to fiscal 2023, due primarily to the acquisition of TDBBS in November 2023.

Corporate expense decreased due primarily to lower equity compensation and the gain from a litigation settlement.

Corporate expenses included within administrative expense relate to the costs of unallocated executive, administrative, finance, legal, human resources, and information technology functions.

The decrease in selling, general and administrative expense was due to $21.1 million in additional costs incurred in the prior year related to the closure of facilities in both the Pet and Garden segments and intangible asset impairments as compared to $9.4 million in additional costs in fiscal 2025 related to facility closures.

Excluding these additional costs in both fiscal 2025 and 2024, non-GAAP selling, general and administrative expense increased $0.6 million to $737.9 million from $737.3 million in fiscal 2024.

Decreased selling, general and administrative expenses in both Pet and Garden were partially offset by increased expense at corporate.

Selling and delivery expense increased $6.1 million, or 1.8%, to $345.9 million for fiscal 2025 from $339.9 million for fiscal 2024.

An increase in the Pet segment, related to increased marketing expense, including promotional and digital marketing spend, and at corporate, related to marketing investment expense, was partially offset by a decrease in the Garden segment due primarily to lower discretionary marketing spend and lower delivery expense.

Warehouse and administrative expense decreased $17.1 million, or 4.1%, to $401.4 million for fiscal 2025 from $418.5 million for fiscal 2024.

Decreased expense in the Pet segment, due primarily to intangible asset impairments in fiscal 2024, and in the Garden segment, related to lower facility closure costs in fiscal 2025 as compared to fiscal 2024, were partially offset by increased corporate expense.

Corporate expense increased $8.1 million due primarily to increased variable compensation expense, increased marketing investment and the nonrecurrence of a gain from a litigation settlement in fiscal 2024.

Corporate expenses are included within administrative expense and relate to the costs of unallocated executive, administrative, finance, legal, human resources, and information technology functions.

Operating Income

Operating income decreased $25.2 million, or 12.0%, to $185.4 million in fiscal 2024 from $210.6 million in fiscal 2023.

Our operating margin was 5.8% in fiscal 2024, decreasing from 6.4% in fiscal 2023.

Decreased sales of $109.6 million and increased selling, general and administrative expenses, partially offset by a 90 basis point increase in gross margin, contributed to the lower operating income.

The increased selling, general administrative expenses were due primarily to facility closures and intangible asset impairments.

Excluding the impact of these costs, on a non-GAAP basis, operating margin was 7.0% in fiscal 2024 compared to 6.9% in fiscal 2023.

Pet operating income increased $5.4 million, or 2.7%, to $203.4 million in fiscal 2024 from $198.0 million in fiscal 2023, due to an improved gross margin partially offset by lower net sales and increased selling, general and administrative expenses.

Operating income improved $64.7 million, or 34.9%, to $250.0 million in fiscal 2025.

Operating income improved due to a $53.6 million increase in gross profit, related to a 240-basis point increase in gross margin, and a $11.1 million decrease in selling, general and administrative expenses.

These improvements were partially offset by a $71.4 million decrease in net sales.

Our operating margin improved to 8.0% in fiscal 2025 from 5.8% in fiscal 2024.

Excluding the impact of facility closures in fiscal 2025 and 2024 and intangible asset impairments in fiscal 2024, non-GAAP operating income improved $42.2 million and our non-GAAP operating margin improved to 8.5% in fiscal 2025 from 7.0% in fiscal 2024.

These improvements were due primarily to efficiency gains and cost reductions from earlier productivity initiatives under our Cost and Simplicity agenda and the write-down of the value of our grass seed inventory in fiscal 2024.

Pet operating income increased $12.3 million, or 6.0%, to $215.7 million in fiscal 2025 from $203.4 million in fiscal 2024, due to an improved gross margin and decreased selling, general and administrative expenses partially offset by lower net sales.

Pet operating margin increased from 11.1% in fiscal 2024 to 12.0% in fiscal 2025.

On a non-GAAP basis, Pet operating income increased $1.9 million in fiscal 2025 as compared to fiscal 2024 and operating margin improved to 12.5% in fiscal 2025 from 12.2% in fiscal 2024.

Garden operating income decreased $41.6 million, or 33.7%, to $81.9 million in fiscal 2024 from $123.5 million in fiscal 2023, due to lower sales, a lower gross margin, and higher selling, general and administrative expenses.

Both gross margin and selling, general and administrative expenses were impacted by charges related to the closure of facilities and the planned exit of the pottery business.

On a non-GAAP basis that excludes the impact of these charges in both fiscal 2024 and fiscal 2023, Garden non-GAAP operating income declined $19.4 million in fiscal 2024 as compared to fiscal 2023 and non-GAAP operating margin declined to 7.5% in fiscal 2024 from 8.5% in fiscal 2023 due primarily to a write-down of the value of our grass seed inventory due to a recent significant decrease in the market prices for grass seed and what we believe to be an industry-wide over supply of grass seed and lower sell through in our Live Plants business.

Corporate expenses decreased $10.9 million due primarily to lower equity compensation and the gain from a litigation settlement.

Garden operating income improved $60.5 million, or 73.9%, to $142.4 million in fiscal 2025 from $81.9 million in fiscal 2024, due to a $45.3 million increase in gross profit and a $15.2 million decrease in selling, general and administrative expense partially offset by a $40.6 million decrease in net sales.

Garden operating margin improved to 10.7% in fiscal 2025 from 6.0% in fiscal 2024.

On a non-GAAP basis, excluding the charges in fiscal 2025 and 2024 related to facility closures, Garden operating income improved $45.2 million and non-GAAP operating margin improved to 11.1% in fiscal 2025 from 7.5% in fiscal 2024.

Corporate expenses increased $8.1 million due primarily to increased variable compensation expense, increased marketing investment and the nonrecurrence of a gain from a litigation settlement in fiscal 2024.

Net Interest Expense

Net interest expense decreased $5.1 million, or 13.4%, from $37.9 million in fiscal 2024 to $32.8 million in fiscal 2025.

The decrease in net interest expense was due to increased interest income due primarily to higher cash balances during fiscal 2024.

Debt outstanding on September 28, 2024 was $1,190.0 million compared to $1,188.2 million as of September 30, 2023.

The decrease in net interest expense was due to increased interest income resulting from higher cash balances during fiscal 2025.

Debt outstanding on September 27, 2025 and September 28, 2024 was $1.2 billion.

Our average borrowing rate was 4.5% in both fiscal 2025 and fiscal 2024.

1 unchanged sentence

Other income (expense) is comprised of income or loss from investments accounted for under the equity method of accounting and foreign currency exchange gains and losses.

Other income (expense) was an expense of $5.1 million in fiscal 2024 compared to income of $1.5 million in fiscal 2023, due primarily to a $7.5 million impairment in fiscal 2024 for two private company investments.

Other income (expense) was an expense of $0.5 million in fiscal 2025 compared to $5.1 million in fiscal 2024.

The decrease in expense was due primarily to a $7.5 million non-cash impairment in fiscal 2024 for two private company investments.

Our effective income tax rate was 24.4% for fiscal 2025 compared to 23.2% for fiscal 2024.

The increase in our effective income tax rate was primarily due to an increase in the blended state income tax rate in fiscal 2024 as compared to fiscal 2023.

The increase in our effective income tax rate was due primarily to the non-deductibility for tax purposes of losses incurred in connection with the wind-down of our U.K.

Net Income and Earnings Per Share

5 unchanged sentences

We report our financial results in accordance with GAAP.

However, to supplement the financial results prepared in accordance with GAAP, we use non-GAAP financial measures including non-GAAP net income and diluted net income per share, non-GAAP operating income, non-GAAP gross profit and gross margin, non-GAAP selling, general and administrative expense, adjusted EBITDA and organic net sales.

Management uses these non-GAAP financial measures that exclude the impact of specific items (described below) in making financial, operating and planning decisions and in evaluating our performance.

1 unchanged sentence

While management believes that non-GAAP measures are useful supplemental information, such adjusted results are not intended to replace our GAAP financial results and should be read in conjunction with those GAAP results.

Adjusted EBITDA is defined by us as income before income tax, net other expense, net interest expense and depreciation and amortization and stock-based compensation expense (or operating income plus depreciation and amortization expense and stock-based compensation expense).

Adjusted EBITDA further excludes one-time charges related to facility closures exits of business, intangible and investment impairments and gains from a litigation settlement.

Adjusted EBITDA is defined by us as income before income tax, net other expense, net interest expense, depreciation and amortization and stock-based compensation expense (or operating income plus depreciation and amortization expense and stock-based compensation expense).

Adjusted EBITDA further excludes one-time charges related to facility closures, exits of businesses, intangible and investment impairments and gains from litigation.

We present adjusted EBITDA because we believe that adjusted EBITDA is a useful supplemental measure in evaluating the cash flows and performance of our business and provides greater transparency into our results of operations.

6 unchanged sentences

• Facility closures and business exit:

we have excluded charges related to the closure of distribution and manufacturing facilities and our decision to exit the pottery business as they represent infrequent transactions that impact the comparability between operating periods.

between operating periods.

We believe these exclusions supplement the GAAP information with a measure that may be useful to investors in assessing the sustainability of our operating performance .

5 unchanged sentences

We believe that the exclusion of this gain supplements the GAAP information with a measure that can be used to assess the performance of our ongoing operations.

• Gain on sale of a business or service line :

we exclude the impact of the gain on the sale of a business as it represents an infrequent transaction that occurs in limited circumstances that impacts the comparability between operating periods.

We believe the adjustment of this gain supplements the GAAP information with a measure that may be used to assess the performance of our ongoing operations.

• Tax impact:

adjustment represents the impact of the tax effect of the pre-tax non-GAAP adjustments excluded from non-GAAP net income.

The tax impact of the non-GAAP adjustments is calculated based on the consolidated effective tax rate on a GAAP basis, applied to the non-GAAP adjustments, unless the underlying item has a materially different tax treatment.

The tax impact of the non-GAAP adjustments is calculated based on the consolidated effective tax rate on a GAAP basis, applied to the non-GAAP adjustments.

From time to time in the future, there may be other items that we may exclude if we believe that doing so is consistent with the goal of providing useful information to investors and management.

1 unchanged sentence

Facility closures and business exits

(1) During the fourth quarter of fiscal year 2024, we recognized incremental expense of $7.5 million in our Pet segment in the consolidated statement of operations, from the closure of manufacturing facilities in California and Arizona.

Additionally, we recognized incremental expense in our Garden segment of $3.9 million related to facility closures and business exits announced in fiscal 2023 and earlier in fiscal 2024.

(2) During the third quarter of fiscal 2024, we recognized incremental expense of $11.1 million in the consolidated statement of operations, from the decision to exit the pottery business, the closure of a live goods distribution facility in Delaware and the relocation of our grass seed research facility.

(3) During the second quarter of fiscal 2024, we recognized incremental expense of $5.3 million in the consolidated statement of operations from the closure of a manufacturing facility in California and the consolidation of our Southeast distribution network.

(4) During the fourth quarter of fiscal 2023, we recognized a gain of $5.8 million from the sale of our independent garden center distribution business, which includes the impact of associated facility closure costs.

The gain is included in selling, general and administrative expense in the consolidated statement of operations.

(5) In fiscal 2023, we recognized incremental expense of $13.9 million in our Pet segment in the consolidated statement of operations from the closure of a manufacturing and distribution facility in Texas.

Additionally, we recognized incremental expense of $1.8 million in our Pet segment in the consolidated statement of operations, from the closure of a second manufacturing and distribution facility in Texas.

(1) During fiscal 2025, we recognized incremental expense of $5.0 million in our Garden segment in the consolidated statement of operations related to closing a distribution facility in Ontario, California and executing the consolidation of our Western distribution network.

Additionally, the charge includes costs related to the closure of a live goods facility.

(2) During fiscal 2025, we recognized incremental expense of $10.0 million in our Pet segment in the consolidated statement of operations related to our decision to wind-down our operations in the U.K.

and the related facility as we move to a direct-export model.

(3) During fiscal 2024, we recognized incremental expense of $20.3 million in our Garden segment in the consolidated statement of operations, from the closure of a manufacturing facility in California, the consolidation of our Southeast distribution network, the decision to exit the pottery business, the closure of a live goods distribution facility in Delaware, the relocation of our grass seed research facility related, and facility closures announced in fiscal 2023.

(4) During fiscal 2024, we recognized incremental expense of $7.5 million in our Pet segment in the consolidated statement of operations, from the closure of manufacturing facilities in California and Arizona.

Intangible Impairments

(6) During the fourth quarter of fiscal 2024, we recognized a non-cash impairment charge in our Pet segment of $12.8 million related to the impairment of intangible assets due primarily to changing market conditions resulting from the decline in demand for durable products and increased international competition.

(7) In fiscal 2023, we recognized a non-cash impairment charge in our Pet segment of $2.8 million related to the impairment of intangible assets caused by the loss of a significant customer in our live fish business.

Also, we recognized a non-cash impairment charge in our Garden segment of $3.9 million related to the impairment of intangible assets due to reduced demand for products we sold under an acquired trade name.

The impairments were recorded as part of selling, general and administrative costs.

(5) During fiscal 2024, we recognized a non-cash impairment charge in our Pet segment of $12.8 million related to the impairment of intangible assets due primarily to changing market conditions resulting from the decline in demand for durable products and increased international competition.

Gain from litigation and investment impairment

(8) Within corporate, the Company received $3.2 million during the fourth quarter of fiscal 2024 in settlement of litigation which gain is included in selling, general and administrative expense.

(6) In fiscal 2024, within corporate, we received $3.2 million in settlement of litigation, the gain of which is included in selling, general and administrative expense.

Net Income and Diluted Net Income Per Share Reconciliation GAAP to Non-GAAP Reconciliation

Fiscal Year Ended

Net Income and Diluted Net Income Per Share

GAAP to Non-GAAP Reconciliation Fiscal Year Ended

September 27, 2025 September 28, 2024

1 unchanged sentence

GAAP net income attributable to Central Garden & Pet Company $ 162,843 $ 107,983

Facility closures (1)(2)(3)(5) 27,842 15,672

Facility closures & business exits (1)(2)(3)(4) 15,005 27,842

Intangible impairments (5) — 12,790

Litigation settlement (6) — (3,200)

Independent channel distribution business sale (4) — (5,844)

Investment impairment (6) — 7,461

4 unchanged sentences

Shares used in GAAP and non-GAAP diluted net income per share calculation 63,815 66,860

Operating Income Reconciliation GAAP to Non-GAAP Reconciliation

Fiscal Year Ended September 28, 2024 Fiscal Year Ended September 30, 2023

Operating Income

GAAP to Non-GAAP Reconciliation Fiscal Year Ended September 27, 2025 Fiscal Year Ended September 28, 2024

GAAP Adjustments (1)(2)

8 unchanged sentences

Operating margin 8.0 % 8.5% 5.8% 7.0%

Pet Segment Operating Income Reconciliation GAAP to Non-GAAP Reconciliation

Fiscal Year Ended

Pet Segment Operating Income

GAAP to Non-GAAP Reconciliation Fiscal Year Ended

September 27, 2025 September 28, 2024

6 unchanged sentences

Non-GAAP operating margin 12.5% 12.2%

Garden Segment Operating Income Reconciliation GAAP to Non-GAAP Reconciliation

Fiscal Year Ended

Garden Segment Operating Income

GAAP to Non-GAAP Reconciliation Fiscal Year Ended

September 27, 2025 September 28, 2024

2 unchanged sentences

Facility closures (1)(3) 4,987 20,293

Independent channel distribution business sale (4) — (5,844)

Intangible impairments (7) — 3,946

Non-GAAP operating income $ 147,389 $ 102,186

1 unchanged sentence

Non-GAAP operating margin 11.1% 7.5%

Organic Net Sales Reconciliation GAAP to Non-GAAP Reconciliation

Fiscal Year Ended September 28, 2024

Net sales (GAAP) Effect of acquisitions & divestitures on net sales Net sales organic

(in millions)

Reported net sales FY 2024 $ 3,200.5 $ 66.4 $ 3,134.1

Reported net sales FY 2023 3,310.1 48.1 3,262.0

$ decrease $ (109.6) $ 18.3 $ (127.9)

% decrease (3.3) % (3.9) %

Organic Pet Segment Net Sales Reconciliation GAAP to Non-GAAP Reconciliation

Fiscal Year Ended September 28, 2024

Net sales (GAAP) Effect of acquisitions & divestitures on net sales Net sales organic

(in millions)

Reported net sales FY 2024 $ 1,832.8 $ 66.4 $ 1,766.4

Reported net sales FY 2023 1,877.2 — 1,877.2

$ decrease $ (44.4) $ 66.4 $ (110.8)

% decrease (2.4) % (5.9) %

Organic Garden Segment Net Sales Reconciliation GAAP to Non-GAAP Reconciliation

Fiscal Year Ended September 28, 2024

Net sales (GAAP) Effect of acquisitions & divestitures on net sales Net sales organic

(in millions)

Reported net sales FY 2024 $ 1,367.7 $ — $ 1,367.7

Reported net sales FY 2023 1,432.9 48.1 1,384.8

$ decrease $ (65.2) $ (48.1) $ (17.1)

% decrease (4.6) % (1.2) %

Adjusted EBITDA Reconciliation GAAP to Non-GAAP Reconciliation

Fiscal Year Ended September 28, 2024

Adjusted EBITDA

GAAP to Non-GAAP Reconciliation Fiscal Year Ended September 27, 2025

Pet Garden Corp Total

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Net income attributable to noncontrolling interest — — — 1,120

Sum of items below operating income — — — 77,404

Income (loss) from operations 215,688 142,402 (108,048) 250,042

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Adjusted EBITDA $ 265,622 $ 189,690 $ (84,311) $ 371,001

Adjusted EBITDA Reconciliation GAAP to Non-GAAP Reconciliation

Fiscal Year Ended September 30, 2023

Adjusted EBITDA

GAAP to Non-GAAP Reconciliation Fiscal Year Ended September 28, 2024

Pet Garden Corp Total

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Interest expense, net — — — 37,872

Other income — — — (1,462)

Other expense — — — 5,090

Income tax expense — — — 33,112

Net income attributable to noncontrolling interest — — — 1,330

Sum of items below operating income — — — 85,003

Income (loss) from operations 203,425 81,893 (99,931) 185,387

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Adjusted EBITDA $ 267,406 $ 146,589 $ (79,786) $ 334,209

Our revenues and margins are dependent on various economic factors, including rates of inflation, energy costs, interest rates, consumer attitudes toward discretionary spending, currency fluctuations, and other macro-economic factors which may impact levels of consumer spending.

In fiscal years 2021 through 2023, we were adversely impacted by high input costs due to inflation, particularly relating to prices for grain and seed, fuel and the ingredients used in our garden controls and fertilizer business as well as heightened import costs such as shipping container costs and tariffs.

In fiscal 2022, our gross and operating margins increased as we were able to sufficiently increase prices and volumes to offset higher input costs.

Costs continued rise in fiscal 2023, however, and we were unable to continue to increase prices and our gross and operating margins were negatively impacted.

Inflation began to moderate in late fiscal year 2023 and continued to moderate in fiscal 2024, and we were able to benefit from lower cost inventory and significant productivity gains resulting in improved margins.

In fiscal 2022, we experienced increasing inflationary pressure, including notable increases in costs for key commodities, materials, labor and freight.

During fiscal 2023, we continued to experience inflationary pressures, although at a reduced rate in the latter months of the fiscal year.

In fiscal 2024, we experienced moderating inflation.

Our revenues and margins are dependent on various economic factors, including fluctuating rates of inflation on various input costs (e.g., commodities and energy), interest rates, currencies and consumer attitudes toward discretionary spending.

Inflation moderated in fiscal 2024 and into the first half of fiscal 2025 before increasing in the second half of fiscal 2025 due primarily to the increasing impact of tariffs.

We have benefited from lower cost inventory and significant productivity gains resulting in improved margins.

However, the continued imposition of tariffs and a global trade war could result in higher inflation in fiscal 2026.

In fiscal year 2021 through 2023, our operating results were adversely impacted by high input costs due to inflation, particularly relating to prices for grain and seed, fuel and the ingredients used in our garden controls and fertilizer business as well as heightened import costs such as shipping container costs and tariffs.

Weather and Seasonality

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Generally, during the first fiscal quarter, accounts receivable reach their lowest level while inventory, accounts payable and short-term borrowings begin to increase.

During the second fiscal quarter, receivables, accounts payable and short-term borrowings increase, reflecting the build-up of inventory and related payables in anticipation of the peak lawn and garden selling season.

During the second fiscal quarter, accounts receivable, accounts payable and short-term borrowings increase, reflecting the build-up of inventory and related payables in anticipation of the peak lawn and garden selling season.

During the third fiscal quarter, inventory levels remain relatively constant while accounts receivable peak and short-term borrowings start to decline as cash collections are received during the peak selling season.

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Operating Activities

Net cash provided by operating activities increased $13.3 million, from $381.6 million in fiscal 2023 to $394.9 million in fiscal 2024.

The increase in cash provided was due primarily to changes in our working capital accounts, due to increases in accounts payable and accrued expenses, partially offset by a lower amount of cash generated from the decrease in accounts receivable, as compared to the prior year.

Net cash provided by operating activities increased $415.6 million, from $34.0 million of cash used in operating activities in fiscal 2022 to $381.6 million of cash provided by operating activities in fiscal 2023.

The increase in cash provided was due primarily to changes in our working capital accounts, primarily a decrease in inventory, due to our focus on converting inventory to cash, and in accounts receivable.

Net cash provided by operating activities decreased $62.4 million, from $394.9 million in fiscal 2024 to $332.5 million in fiscal 2025.

The decrease in cash provided was due primarily to changes in our working capital accounts, due to decreases in inventory and accrued expenses, partially offset by cash provided by the long-term obligations in the current year as compared to cash used for other long-term obligations in the prior year.

Investing Activities

Net cash used in investing activities increased $70.6 million from $34.6 million in fiscal 2023 to $105.2 million in fiscal 2024.

The increase in cash used in investing activities was due primarily to our acquisition of TDBBS, LLC.

Net cash used in investing activities decreased $60.3 million from $105.2 million in fiscal 2024 to $44.9 million in fiscal 2025.

The decrease in cash used in investing activities was due primarily to reduced capital expenditures, decreased investments in fiscal 2023 compared to fiscal 2022, and proceeds received from the sale of our independent garden center distribution business.

The decrease in cash used in investing activities was due primarily to our acquisition of TDBBS, LLC in fiscal 2024.

Financing Activities

Net cash used in financing activities decreased $12.1 million from $37.6 million in fiscal 2023 to $25.4 million in fiscal 2024.

The decrease in cash used in financing activities during the current year was due primarily to lower stock repurchase activity in fiscal 2024 compared to fiscal 2023.

Net cash used in financing activities decreased $29.2 million from $66.8 million of cash used in fiscal 2022 to $37.6 million of cash used in fiscal 2023.

The decrease in cash used in financing activities during the current year was due primarily to lower stock repurchase activity in fiscal 2023 compared to fiscal 2022.

Net cash used in financing activities increased $131.2 million from $25.4 million in fiscal 2024 to $156.6 million in fiscal 2025.

The increase in cash used in financing activities during the current year was due primarily to higher stock repurchases in fiscal 2025 compared to fiscal 2024.

We expect that our principal sources of funds will be cash generated from our operations, proceeds from our debt and equity offerings, and, if necessary, borrowings under our $600 million asset backed loan facility.

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However, we cannot assure you that these sources will continue to provide us with sufficient liquidity and, should we require it, that we will be able to obtain financing on terms satisfactory to us, or at all.

We anticipate that our capital expenditures, which are related primarily to replacements and expansion of and upgrades to plant and equipment and also investment in our continued implementation of a scalable enterprise-wide information technology platform, will be approximately $70 million over the next 12 months.

As part of our growth strategy, we have acquired a large number of businesses in the past, and we anticipate that we will continue to evaluate potential acquisition candidates in the future.

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Stock Repurchases

During fiscal 2024, we repurchased approximately 0.3 million shares of our non-voting common stock (CENTA) on the open market at an aggregate cost of approximately $10.7 million and approximately 3 thousand shares of our voting common stock (CENT) on the open market at an aggregate cost of approximately $109 thousand.

During fiscal 2023, we repurchased approximately 0.8 million shares of our non-voting common stock (CENTA) on the open market at an aggregate cost of approximately $22.9 million and approximately 0.3 million shares of our voting common stock (CENT) on the open market at an aggregate cost of approximately $8.7 million.

In August 2019, our Board of Directors authorized a share repurchase program to purchase up to $100 million of our common stock (the "2019 Repurchase Authorization").

The 2019 Repurchase Authorization has no fixed expiration date and expires when the amount authorized has been used or the Board withdraws its authorization.

As of September 28, 2024, we had $82 million remaining under our 2019 Repurchase Authorization.

During fiscal 2025, we repurchased approximately 3.2 million shares of our non-voting common stock (CENTA) and approximately 1.4 million shares of our voting common stock (CENT) on the open market at an aggregate cost of approximately $148.4 million.

During fiscal 2024, we repurchased approximately 0.3 million shares of our non-voting common stock (CENTA) and approximately 3 thousand shares of our voting common stock (CENT) on the open market at an aggregate cost of approximately $10.8 million.

In August 2019, our Board of Directors authorized a $100 million share repurchase program, in part, to minimize the dilutive impact of our stock-based equity compensation programs over time, which authorization was fully utilized in the third quarter of fiscal 2025.

In December 2024, our Board of Directors authorized a $100 million increase in the share repurchase program (the "2024 Repurchase Authorization").

The 2024 Repurchase Authorization has no fixed expiration date and expires when the amount authorized has been used or

the Board withdraws its authorization.

As of September 27, 2025, the Company had $46.5 million remaining under its 2024 Repurchase Authorization.

In February 2019, the Board of Directors authorized us to make supplemental purchases to minimize dilution resulting from issuances under our equity compensation plans (the "Equity Dilution Authorization").

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The Equity Dilution Authorization has no fixed expiration date and expires when the Board withdraws its authorization.

As of September 28, 2024, the Company had authorization remaining to repurchase up to 38 thousand shares under its Equity Dilution Authorization.

During the period September 29, 2024 through November 21, 2024, we repurchased 1.3 million shares of our non-voting common stock (CENTA) and 0.4 million shares of our voting common stock (CENT) on the open market at an aggregate cost of $51.7 million.

As of November 21, 2024, we had $30.3 million remaining on under our 2019 Repurchase Authorization.

At September 27, 2025, our total debt outstanding was $1,191.7 million versus $1,190.0 million at September 28, 2024.

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In April 2021, we issued $400 million aggregate principal amount of 4.125% senior notes due April 2031 (the "2031 Notes").

We used a portion of the net proceeds from the offering to repay all outstanding borrowings under our Amended Credit Facility, with the remainder used for general corporate purposes.

We used a portion of the net proceeds from the offering to repay all outstanding borrowings under our Credit Facility, with the remainder used for general corporate purposes.

We incurred approximately $6 million of debt issuance costs in conjunction with this issuance, which included underwriter fees and legal, accounting and rating agency expenses.

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The 2031 Notes require semi-annual interest payments on April 30 and October 30.

The 2031 Notes are unconditionally guaranteed on a senior basis by each of our existing and future domestic restricted subsidiaries which are borrowers under or guarantors of our Amended Credit Facility.

The 2031 Notes are unconditionally guaranteed on a senior basis by each of our existing and future domestic restricted subsidiaries which are borrowers under or guarantors of our Credit Facility.

The 2031 Notes were issued in a private placement under Rule 144A and will not be registered under the Securities Act of 1933.

We may redeem some or all of the 2031 Notes at any time, at our option, prior to April 30, 2026, at the principal amount plus a "make whole" premium.

The Company may redeem some or all of the 2031 Notes at its option, at any time on or after April 30, 2026 for 102.063%, on or after April 30, 2027 for 101.375%, on or after April 30, 2028 for 100.688% and on or after April 30, 2029 for 100.0%, plus accrued and unpaid interest.

The holders of the 2031 Notes have the right to require us to repurchase all or a portion of the 2031 Notes at a purchase price equal to 101% of the principal amount of the notes repurchased, plus accrued and unpaid interest, upon the occurrence of specific kinds of changes of control.

We may redeem some or all of the 2031 Notes at our option, at any time on or after April 30, 2026 for 102.063%, on or after April 30, 2027 for 101.375%, on or after April 30, 2028 for 100.688% and on or after April 30, 2029 for 100.0%, plus accrued and unpaid interest.

The 2031 Notes contain customary high yield covenants, including covenants limiting debt incurrence and restricted payments, subject to certain baskets and exceptions.

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The 2030 Notes are unconditionally guaranteed on a senior basis by each of our existing and future domestic restricted subsidiaries which are borrowers under or guarantors of our Credit Facility.

We may redeem some or all of the 2030 Notes at any time, at our option, prior to October 15, 2025, at a price equal to 100% of the principal amount plus a “make-whole” premium.

We may redeem some or all of the 2030 Notes, at our option at any time on or after October 15, 2025 for 102.063%, on or after October 15, 2026 for 101.375%, on or after October 15, 2027 for 100.688% and on or after October 15, 2028 for 100.0%, plus accrued and unpaid interest.

We may redeem some or all of the 2030 Notes, at our option, in whole or in part, at any time on or after October 15, 2025 for 102.063%, on or after October 15, 2026 for 101.375%, on or after October 15, 2027 for 100.688% and on or after October 15, 2028 for 100.0%, plus accrued and unpaid interest.

The holders of the 2030 Notes have the right to require us to repurchase all or a portion of the 2030 Notes at a purchase price equal to 101.0% of the principal amount of the notes repurchased, plus accrued and unpaid interest upon the occurrence of a change of control.

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The 2028 Notes are unconditionally guaranteed on a senior basis by our existing and future domestic restricted subsidiaries who are borrowers under or guarantors of our Credit Facility.

We may redeem some or all of the 2028 Notes, at our option, at any time before December 31, 2024 for 101.708%, on or after January 1, 2025 for 100.854% and on or after January 1, 2026 for 100.0%, plus accrued and unpaid interest.

We may redeem some or all of the 2028 Notes at our option, through December 31, 2025 for 101.854% and on or after January 1, 2026 for 100.0%, plus accrued and unpaid interest.

The holders of the 2028 Notes have the right to require us to repurchase all or a portion of the 2028 Notes at a purchase price equal to 101.0% of the principal amount of the notes repurchased, plus accrued and unpaid interest upon the occurrence of a change of control.

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Asset-Based Loan Facility

On December 16, 2021, we entered into a Third Amended and Restated Credit Agreement (“Credit Agreement”).

The Credit Agreement provides for a $750 million principal amount senior secured asset-based revolving credit facility, with up to an additional $400 million principal amount available with the consent of the Lenders, as defined, if we exercise the uncommitted accordion feature set forth therein (collectively, the “Credit Facility”).

The Credit Facility matures on December 16, 2026.

On November 7, 2025, we entered into a Fourth Amended and Restated Credit Agreement (the “Credit Agreement”).

The Credit Agreement provides for a $600 million principal amount senior secured asset-based revolving credit facility, with up to an additional $400 million principal amount available, as defined, if we exercise the uncommitted accordion feature set forth therein (collectively, the “Credit Facility”).

The Credit Facility matures on November 7, 2030.

We may borrow, repay and reborrow amounts under the Credit Facility until its maturity date, at which time all amounts outstanding under the Credit Facility must be repaid in full.

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Proceeds of the Credit Facility may be used for general corporate purposes.

Net availability under the Credit Facility was approximately $481 million as of September 28, 2024.

The Credit Facility includes a $50 million sublimit for the issuance of commercial and standby letters of credit and a $75 million sublimit for Swing Loan borrowings.

As of September 28, 2024, there were no borrowings outstanding and no letters of credit outstanding under the Credit Facility.

Outside of the Credit Facility, there were other letters of credit of $3.0 million outstanding as of September 28, 2024.

Borrowings under the Credit Facility will bear interest at an index based on SOFR (which will not be less than 0.00%) or, at our option, the Base Rate, plus, in either case, an applicable margin based on our usage under the Credit Facility.

The Credit Facility includes a $50 million sublimit for the issuance of standby and commercial letters of credit and a $75 million sublimit for swing loan borrowings.

Base Rate is defined as the highest of (a) the Truist prime rate, (b) the Federal Funds Rate plus 0.50%, (c) one-month SOFR plus 1.00% and (d) 0.00%.

The applicable margin for SOFR-based borrowings fluctuates between1.00%-1.50%, and was 1.0% as of September 28, 2024, and the applicable margin for Base Rate borrowings fluctuates between 0.00%-0.50%, and was 0.00% as of September 28, 2024.

An unused line fee shall be payable quarterly in respect of the total amount of the unutilized Lenders’ commitments under the Credit Facility.

Standby letter of credit fees accruing at the

applicable margin on the average undrawn and unreimbursed amounts of standby letters of credit are payable quarterly, and a facing fee of 0.125% is payable quarterly for the stated amount of each letter of credit.

The applicable margin for SOFR-based borrowings fluctuates between1.00%-1.50% and the applicable margin for Base Rate borrowings fluctuates between 0.00%-0.50%.

An unused line fee shall be payable quarterly in respect of the total amount of the unutilized commitments under the Credit Facility, and a letter of credit plus a facing fee to the issuing bank.

We are also required to pay certain fees to the administrative agent under the Credit Facility.

As of September 28, 2024, the applicable interest rate related to Base Rate borrowings was 8.0%, and the applicable interest rate related to one-month SOFR-based borrowings was 5.8%.

We incurred approximately $2.4 million of debt issuance costs in conjunction with this transaction, which included lender fees and legal expenses.

The debt issuance costs are being amortized over the term of the Credit Facility.

The Credit Facility continues to contain customary covenants, including financial covenants which require us to maintain a minimum fixed charge coverage ratio of 1:1 upon triggered quarterly testing (e.g.

when availability falls below certain thresholds established in the agreement), reporting requirements and events of default.

The Credit Facility is secured by substantially all assets of the borrowing parties, including (i) pledges of 100% of the stock or other equity interest of each domestic subsidiary that is directly owned by such entity and (ii) 65% of the stock or other equity interest of each foreign subsidiary that is directly owned by such entity, in each case subject to customary exceptions.

We were in compliance with all financial covenants under the Credit Facility as of September 28, 2024.

The Credit Facility contains customary covenants, including a financial covenant which requires us to maintain a minimum fixed charge coverage ratio of 1:1 when availability falls below certain thresholds established in the Credit Agreement, reporting requirements and events of default.

The Credit Facility is secured by substantially all of our assets and the assets of our subsidiaries guaranteeing the Credit Facility, including (i) pledges of 100% of the stock or other equity interest of each domestic subsidiary that is directly owned by such entity and (ii) 65% of the stock or other equity interest of each foreign subsidiary that is directly owned by such entity, in each case subject to customary exceptions.

As of September 27, 2025, the previous $750 million Third Amended and Restated Credit Facility was in effect as described in Note 11 - Long - Term Debt .

Summarized Financial Information for Guarantors and the Issuer of Guaranteed Securities

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The Guarantees are senior unsecured obligations of each Guarantor and are of equal rank with all other existing and future senior indebtedness of the Guarantors.

The obligations of each Guarantor under its Guarantee shall be limited to the maximum amount, after giving effect to all other contingent and fixed liabilities of such Guarantor and to any collections from or payments made by or on behalf of any other Guarantor in respect of the obligations of such Guarantor under the guarantee not constituting a fraudulent conveyance or fraudulent transfer under Federal or state law.

respect of the obligations of such Guarantor under the guarantee not constituting a fraudulent conveyance or fraudulent transfer under Federal or state law.

The Guarantee of a Guarantor will be released:

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The summarized information excludes financial information of the Non-Guarantors, including earnings from and investments in these entities.

Summarized Statements of Operations

(in thousands) Fiscal Year Ended Fiscal Year Ended

Summarized Statements of Operations Fiscal Year Ended

September 27, 2025 September 28, 2024

(in thousands)

Parent/Issuer Guarantors Parent/Issuer Guarantors

(in thousands)

Net sales $ 770,812 $ 2,348,267 $ 694,083 $ 2,491,748

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Net income (loss) (45,373) 223,637 (58,047) 163,797

Summarized Balance Sheet Information

(in thousands) As of As of

Summarized Balance Sheet Information As of As of

September 27, 2025 September 28, 2024

(in thousands)

Parent/Issuer Guarantors Parent/Issuer Guarantors

(in thousands)

Current assets $ 1,065,394 $ 881,526 $ 936,497 $ 896,476

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some having fixed prices or quantities, others having variable pricing and quantities.

For certain agreements,

management estimates are used to develop the quantities and pricing for anticipated purchases, and future purchases could vary significantly from such estimates.

For certain agreements, management estimates are used to develop the quantities and pricing for anticipated purchases, and future purchases could vary significantly from such estimates.

(4) Possible performance-based payments associated with prior acquisitions of businesses are not included in the above table, because they are based on future performance of the businesses acquired, which is not yet known.

Performance-based payments of approximately $0.1 million were made in fiscal 2024 related to Hydro-Organics Wholesale, Inc.

Potential performance-based periods extend through fiscal 2025 for Hydro-Organics Wholesale, Inc.

and the payments are capped at $1.0 million per year.

Recent Accounting Pronouncements

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We test goodwill for impairment annually (as of the first day of the fourth fiscal quarter), or whenever events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount, by first assessing qualitative factors to determine whether it is more likely than not the fair value of the reporting unit is less than its carrying amount.

The qualitative assessment evaluates factors including macro-economic conditions, industry-specific and company-specific considerations, legal and regulatory environments and historical performance.

The qualitative assessment

evaluates factors including macro-economic conditions, industry-specific and company-specific considerations, legal and regulatory environments and historical performance.

If it is determined that it is more likely than not the fair value of the reporting unit is greater than its carrying amount, it is unnecessary to perform the quantitative goodwill impairment test.

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We completed our qualitative assessment of potential goodwill impairment and determined that it was more likely than not the fair values of our reporting segments were greater than their carrying amount in fiscal year 2025, and accordingly, no further testing of goodwill was required in fiscal 2025.

In connection with our annual goodwill impairment testing performed during fiscal 2023, we elected to bypass the qualitative assessment and proceeded directly to performing the quantitative goodwill impairment test.

We completed our quantitative assessment of potential goodwill and determined that it was more likely than not the fair values of our reporting segments were greater than their carrying amounts.

In connection with our annual goodwill impairment testing performed during fiscal year 2024, we made a qualitative evaluation about the likelihood of goodwill impairment to determine whether it was necessary to calculate the fair values of our reporting segments under the goodwill impairment test.

We completed our qualitative assessment of potential goodwill impairment and determined that it was more likely than not the fair values of our reporting segments were greater than their carrying amount in fiscal year 2024, and accordingly, no further testing of goodwill was required in fiscal year 2024.

We completed our quantitative assessment of potential goodwill and determined that it was more likely than not the fair values of our reporting segments were greater than their carrying amounts.

Changes in the judgments and estimates underlying our analysis of goodwill for possible impairment, including expected future cash flows and discount rates, could result in a significantly different estimate of the fair value of the reporting units in the future and could result in additional impairment of goodwill.

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Our expected revenues were based on our future operating plan and market growth or decline estimates for future years.

We recognized impairment losses on certain intangible assets of $12.8 million and $11.5 million in fiscal years 2024 and 2023, respectively, and there were no impairment losses recorded in fiscal year 2022.

In connection with businesses we acquire, management must determine the fair values of assets acquired and liabilities assumed.

Considerable judgment and estimates are required to determine such amounts, particularly as they relate to identifiable intangible assets, and the applicable useful lives related thereto.

Under different assumptions, the resulting valuations could be materially different, which could materially impact the operating results we report.

We account for business combinations using the acquisition method of accounting whereby the identifiable assets and liabilities of the acquired business, including contingent consideration, as well as any noncontrolling interest in the acquired business, are recorded at their estimated fair values as of the date that we obtain control of the acquired business.

Any purchase consideration in excess of the estimated fair values of the net assets acquired is recorded as goodwill.

Acquisition-related expenses and related restructuring costs are expensed as incurred.

Several valuation methods may be used to determine the fair value of assets acquired and liabilities assumed.

For intangible assets, we typically use a variation of the income approach, whereby a forecast of future cash flows attributable to the asset is discounted to present value using a risk-adjusted discount rate.

Some of the more significant estimates and assumptions inherent in the income approach include the amount and timing of projected future cash flows, the discount rate selected to measure the risks inherent in the future cash flows, and the assessment of the asset’s expected useful life.

Refer to Note 3 - Acquisitions and Investments in Joint Ventures , to the consolidated financial statements included in this Annual Report for additional information regarding our acquisitions.

Our contractual commitments are presented under the caption Liquidity and Capital Resources.

We recognized impairment losses on certain intangible assets of $1.0 million, $12.8 million and $11.5 million in fiscal 2025, 2024 and 2023, respectively.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis