What changed in this filing

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Item 1. Business

2023-10-24 compared with 2022-10-21 · 116 added, 123 removed, 284 unchanged (46% of the section changed)

The Simply Good Foods Company is a consumer packaged food and beverage company that aims to lead the nutritious snacking movement with trusted brands that offer a variety of convenient, innovative, great-tasting, better-for-you snacks and meal replacements, and other product offerings.

The product portfolio we develop, market and sell consists primarily of protein bars, ready-to-drink (“RTD”) shakes, sweet and salty snacks and confectionery products marketed under the Atkins®, Atkins Endulge®, Quest® and Quest Hero TM brand names.

Simply Good Foods is poised to expand its wellness platform through innovation and organic growth along with acquisition opportunities in the nutritional snacking space.

The Company’s nutritious snacking platform consists of brands that specialize in providing products for consumers that follow certain nutritional philosophies and health-and-wellness trends:

Atkins for those following a low-carb lifestyle or seeking to lose weight and Quest for consumers seeking a variety of protein-rich foods and beverages that also limit sugars and simple carbs.

Our nutritious snacking platform consists of brands that specialize in providing products for consumers that follow certain nutritional philosophies and health-and-wellness trends:

Quest for consumers seeking a variety of protein-rich foods and beverages that also limit sugars and simple carbohydrates and Atkins for those following a low-carbohydrate lifestyle or seeking to manage weight or blood sugar levels.

We distribute our products in major retail channels, primarily in North America, including grocery, club, and mass merchandise, as well as through e-commerce, convenience, specialty, and other channels.

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Some of these trends include increased consumption of smaller, more frequent meals throughout the day, consumers’ strong preference for convenient, “better-for-you” snacks, consumers’ greater focus on health and wellness, consumers’ movement toward limiting carbohydrate and sugar consumption, and the trend of consumers seeking to add convenient sources of protein and fiber to their diets.

With our Atkins brand, we strive to offer a compelling line of protein bars, RTD shakes, cookies, protein chips and salty snacks, and confections, and with our Quest brand, we strive to offer an attractive line up of protein bars, cookies, protein chips and salty snacks, RTD shakes, and confections, which target these existing and emerging consumer trends.

With our Quest brand, we strive to offer an attractive line up of protein bars, cookies, protein chips and salty snacks, RTD shakes, and confections, which target these existing and emerging consumer trends.

With our Atkins brand, we strive to offer a compelling line of protein bars, RTD shakes, cookies, protein chips and salty snacks, and confections.

Our sales, marketing, and research and development capabilities enable us to distribute products to a national customer base across a spectrum of retail channels, including the mass merchandise, grocery, drug, club stores, e-commerce, and small format retail such as convenience stores and gas stations.

Simply Good Foods was formed in Delaware on March 30, 2017, to consummate the Business Combination, which occurred on July 7, 2017.

As part of our strategy to become an industry leading snacking platform, in November 2019, we acquired Quest Nutrition, LLC.

In addition to pursuing attractive run-rate cost synergies over time by leveraging efficiencies of scale with our legacy Atkins business, we completed the Quest Acquisition with the goal of realizing several other potential benefits.

Quest’s products compete in many attractive, fast growing sub-segments within the nutritional snacking category.

In addition, Quest’s research and development insights and capabilities have benefited our broader business.

Quest has an extremely loyal following and strong appeal among consumers ages 18-35, which complements Atkins’ strength among consumers ages 35+.

The Quest Acquisition also allowed us to benefit from Quest’s existing relationships and effectiveness within certain channels of trade, such as e-commerce and the small format channel, and leverage Quest’s social media-based marketing capabilities.

Since completion of the Quest Acquisition, we have benefited from utilizing certain of Quest’s systems, such as its enterprise resource planning platform, and associated reporting tools.

The Simply Good Foods Company (“Simply Good Foods”) was formed on March 30, 2017, to acquire NCP-ATK Holdings, Inc.

(“Atkins”), on July 7, 2017.

As part of Simply Good Foods’ strategy to become an industry leading snacking platform, in November 2019, we acquired Quest Nutrition, LLC (“Quest”).

This transaction is referred to as the “Quest Acquisition.”

Our principal executive offices are located at 1225 17 th Street, Suite 1000, Denver, Colorado, 80202.

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Business Trends in Fiscal Year 2023

Throughout fiscal year 2022, our business continued to improve from the end of fiscal year 2021, driven in part by the increasing normalization of consumer mobility and shopper traffic patterns in brick-and-mortar retailers versus prior periods that were more severely pressured by COVID-19 mitigation strategies, including movement restrictions and closures of or reduced access to customer establishments.

We expect our business performance during fiscal year 2023 will continue to be affected by the dynamic macroeconomic inflationary environment in the United States and elsewhere, elevated levels of supply chain cost inflation, and the level of consumer mobility, which includes the rate at which consumers return to working outside the home.

Overall consumer spending, particularly in the United States, continued to recover from the effects of the COVID-19 pandemic, which resulted in well documented industry-wide supply chain disruptions across the United States and globally during fiscal year 2022.

As a result, we experienced corresponding unfavorable effects of higher raw material costs, higher freight and logistics costs, and supply chain challenges, including supply chain disruptions resulting from labor shortages and disruptions in ingredients.

We expect to continue to see these cost pressures and supply chain challenges persist into fiscal year 2023.

We have also continued to see contract manufacturer and logistics challenges, largely related to availability of labor, which we believe along with the ingredient shortages discussed above have contributed to lower retail and e-commerce sales of our products due to periodic out-of-stock situations, delayed recognition of sales and higher than historical inventory levels at times.

The improvement in consumer mobility and shopper traffic patterns experienced during fiscal year 2022 has been variable, and there continues to be uncertainty related to the sustainability and longevity of these trends.

The ultimate effect COVID-19, supply chain challenges, cost pressures discussed above, and the overall effects of the current high inflation environment on consumer purchasing patterns could have on our business continues to be not fully known.

Additionally, management is continuing to monitor the conflict in Ukraine, especially regarding the availability and cost of raw materials that are produced in this region and Europe in general.

Management is also monitoring for signs of any expansion of economic or supply chain disruptions or broader supply chain inflationary costs resulting either directly or indirectly from the crisis in Eastern Europe.

Throughout fiscal year 2023, we continued to actively monitor the effects of the dynamic macroeconomic inflationary environment in the United States and elsewhere, elevated levels of supply chain costs, the level of consumer mobility, including the rate at which consumers return to working outside the home, and consumer behavior.

Current or future governmental policies may increase the risk of inflation and possible economic recession, which could further increase the costs of ingredients, packaging and finished goods for our business as well as negatively affect consumer behavior and demand for our products.

During fiscal year 2023, our business performance was affected by unfavorable raw material costs, higher co-manufacturing costs, and supply chain challenges, including supply chain disruptions resulting from labor shortages and disruptions in sourcing ingredients.

The supply chain environment showed signs of improvement during fiscal year 2023 and we expect to see improvement during fiscal year 2024 in overall cost environment and in our gross margin.

We continue to proactively engage with our retail customers, contract manufacturers, and logistics and transportation providers, to meet demand for our products and to remain informed of any challenges within our business operations.

For more information on the effects of supply chain cost increases on our profitability during fiscal year 2023, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Form 10-K.

Our Strengths

Powerful brands with strong consumer awareness and loyalty .

We are a leader in the fast growing nutritional snacking category, and both the Atkins and Quest brands are leading brands with combined scale in protein bars, protein chips, confections, cookies, and RTD shakes.

We are a leader in the fast growing nutritional snacking category, and both the Quest and Atkins brands are leading brands with combined scale in protein bars, protein chips, confections, cookies, and RTD shakes.

Our highly focused snacking portfolio provides us with a leading position within retailers’ nutrition and wellness aisles, resulting in meaningful shelf space.

Our brands are able to appeal to both consumers interested in an active lifestyle who are seeking protein-rich, low-carb snacking options as well as weight management program consumers, which makes our brands highly attractive and strategic for a diverse set of retailers across various distribution channels.

Our brands can appeal to both consumers interested in an active lifestyle who are seeking protein-rich, low-carb snacking options as well as weight management program consumers, which makes our brands highly attractive and strategic for a diverse set of retailers across various distribution channels.

Aligned with consumer mega trends.

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Over 100 independent, peer reviewed, clinical studies show the benefits of controlling carbohydrates.

Management believes this focus is prompting consumers to rebalance their nutritional breakdown away from carbohydrates.

We believe this focus is prompting consumers to rebalance their nutritional breakdown away from carbohydrates.

Our brand attributes, “low-carb,” “low-sugar” and “protein-rich” nutrition, are well aligned with consumer mega trends.

In addition, we believe consumers’ eating habits are gradually shifting towards increased convenience, snacking and meal replacement.

We also believe our portfolio of convenient and nutritious products and our ongoing effort to meet consumer demands for convenient options to support their individual health, nutrition and lifestyle goals.

We also believe our portfolio of convenient and nutritious products and our ongoing effort to meet consumer demands for convenient snacking options support their individual health, nutrition and lifestyle goals.

Scalable snacking and food platform.

We have been able to grow our product offerings for both of our nutritious snacking brands through our line extensions and through acquisitions.

Our in-house product development experience, combined with our outsourced manufacturing model, allow us to bring new products to market quickly.

Our in-house product development experience and our outsourced manufacturing model allow us to bring new products to market quickly.

We pride ourselves on knowing our consumers and gleaning insights that lead to new products and ideas.

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Simply Good Foods has an experienced team of industry veterans with extensive experience across multiple branded consumer products, food and nutrition categories.

Our management team’s extensive experience is complemented by the significant industry expertise of our directors, including James Kilts, the former Chief Executive Officer of The Gillette Company and Nabisco, and former President of Kraft USA and Oscar Mayer, and David West, the former Chief Executive Officer of Big Heart Pet Brands and The Hershey Company.

Our management team’s deep expertise and proven record of accomplishment in managing brands and operating packaged food businesses is a key driver of our success and positions Simply Good Foods as an attractive vehicle for future long-term growth within the nutritional snacking space.

Our management team’s extensive experience is complemented by the significant industry expertise of our Board of Directors.

Our management team’s deep expertise and proven record of accomplishment in managing brands and operating packaged food businesses is a key driver of our success and we believe positions Simply Good Foods as an attractive vehicle for future long-term growth within the nutritional snacking space.

Our Strategies

Innovate and expand the portfolio of product offerings to meet consumer demand for higher protein products and new product forms.

We intend to continue to enhance, strengthen and expand our product offerings with new and innovative flavors and forms and packaging alternatives, all while maintaining a commitment to delivering products that meet our targeted nutritional profile and provide the convenience and taste consumers crave.

Our in-house research and development laboratories allow us to develop new products internally and bring them to market quickly through our contract manufacturing network without diverging from high standards of taste, nutritional content, quality, and safety.

Additionally, we intend to satisfy developing and changing consumer preferences through the pursuit of merger and acquisition transactions.

Leverage platform to expand in attractive food and snacking categories .

Management believes the fragmented snacking category presents an opportunity for consolidation and the opportunity to build, through disciplined acquisitions, a leading platform in the nutritional snacking space.

As a leader in nutritious snacking, we believe we have the unique capability to leverage our operating platform, product innovation expertise and customer relationships to expand beyond the Atkins and Quest brands.

We believe the fragmented snacking category presents an opportunity for consolidation and the opportunity to build, through disciplined acquisitions, a leading platform in the nutritional snacking space.

In addition, we believe the nutritious snacking category will continue to grow given its relatively low household penetration and favorable consumer trends of snacking, health and wellness, convenience, and on-the-go consumption.

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Over time, we expect to continue seeking to identify and evaluate acquisition opportunities to complement our platform, and we see significant opportunity for growth and synergies in complementary adjacent snacking categories such as the “better-for-you” eating space.

Innovate and expand the portfolio of product offerings to meet consumer demand for higher protein products and new product forms.

We intend to continue to enhance, strengthen and expand our product offerings with new and innovative flavors and forms and packaging alternatives, all while maintaining a commitment to delivering products that meet our nutritional profile and provide the convenience that consumers crave.

Additionally, we intend to satisfy developing and changing consumer preferences through the pursuit of merger and acquisition transactions.

Expand distribution in white space opportunities.

In the fifty-two weeks ended August 27, 2022, approximately 88% of Atkins’ gross sales in the U.S.

and approximately 75% of Quest’s gross sales in the U.S.

In the fifty-two weeks ended August 26, 2023, approximately 77% of Quest’s gross sales in the U.S.

and approximately 86% of Atkins’ gross sales in the U.S.

were through the mass retailer, grocery and convenience store distribution channels.

Our management believes there is opportunity for the brands to further penetrate those channels as well as other distribution channels such as convenience and club stores.

In addition, while shoppers have increased e-commerce purchases generally, approximately 12% of Atkins’ gross sales for the fifty-two weeks ended August 27, 2022, were through its e-commerce channel and approximately 21% of Quest’s gross sales for the same period were through its e-commerce channel.

Our management believes there is opportunity for the brands to further penetrate those channels as well as other

distribution channels such as convenience and club stores.

In addition, while shoppers have increased e-commerce purchases generally, approximately 21% of Quest’s gross sales for the fifty-two weeks ended August 26, 2023 were through its e-commerce channel and approximately 14% of Atkins’ gross sales for the same period were through its e-commerce channel.

We intend to leverage our brand recognition to develop further the distribution channels through which we reach consumers, including through the continued expansion of the e-commerce channel.

Continue our marketing efforts to increase household penetration.

We intend to expand our marketing efforts to bring first-time buyers into the Atkins and Quest brand franchises.

Consumers who have tried our Atkins and Quest products have a relatively high repeat buying rate and long-term buying behavior, as evidenced by servings per buyer, per year.

For our Atkins brand, our historic consumer base has been people interested in weight loss, and for the Quest brand it has been individuals pursuing a performance-based active and athletic lifestyle.

For both the Atkins and the Quest brands, we have an active and growing digital and social presence, using a comprehensive approach of search, banner, and search engine optimization efforts.

We are a leader in social media, with a top-tier presence on Facebook, Instagram, Pinterest, Twitter and YouTube.

Continue our marketing efforts and strategies to both increase household penetration and reach consumers beyond our core historic buyers.

We intend to expand our marketing efforts to bring first-time buyers into the Quest and Atkins brand franchises.

For our Quest brand, our historic consumer base has been individuals pursuing a performance-based active and athletic lifestyle and for our Atkins’ brand it has been people interested in weight management.

As public opinion on the use of chronic weight management medication is shifting significantly as the popularity of clinical solutions grows and more medications are approved by the FDA, we are looking to communicate to consumers who have elected to use these medications what we believe are the complementary benefits of using our products to support achieving or maintaining their weight management goals.

For both the Quest and Atkins brands, we have an active and growing digital and social presence, using a comprehensive approach of search, banner, and search engine optimization efforts.

We are a leader in social media, with an evolving social media presence on major channels such as Facebook, Instagram, Pinterest, X (formerly known as Twitter) and YouTube.

We also have a growing network of social influencers and content creators, who promote our products in their targeted social media posts.

We believe that social media is a cost-effective way of continuing to attract and retain our consumers.

We believe that our ongoing efforts to educate consumers about the benefits of a lower carbohydrate lifestyle will further reinforce our brands.

For our Atkins brand, we use targeted broadcast and streaming television and print ads with a celebrity-based campaign that attempts to motivate potential programmatic weight loss consumers to try the Atkins approach to healthier eating and weight loss as these Atkins consumers are our most loyal, profitable and frequent purchasers.

For our Quest brand, we launched a national, targeted broadcast ad campaign, and continue to leverage targeted streaming television ads and an extensive network of social media influencers and content creators who prompt our Quest brand products through their online posts to motivate new buyers and new product introductions.

Further develop our brand marketing strategies to reach consumers beyond our core historic buyers.

We believe that our ongoing efforts to educate consumers about the benefits of our nutrition philosophy and lifestyle will further reinforce our brands.

For our Quest brand, we have used a national, targeted broadcast ad campaign, and continue to leverage targeted streaming television ads and an extensive network of social media influencers and content creators who prompt both our Quest brand products through their online posts to motivate new buyers and product introductions.

For our Atkins brand, we use targeted broadcast and streaming television and print ads with a celebrity-based campaign that attempts to (i) motivate potential programmatic weight loss consumers to try the Atkins approach to healthier eating and weight loss as these Atkins consumers are our most loyal, profitable and frequent purchasers and (ii) broaden the reach of the Atkins brand to appeal to those consumers generally interested in low carbohydrate, low sugar nutrition.

We intend to continue to make focused changes to our approach to consumer outreach to attract consumers beyond our historic core buyers.

For our Quest brand, we intend to enhance our marketing efforts to reach more consumers who are seeking products that are aligned with their choice to pursue a healthy and active lifestyle.

For the Atkins brand, we intend to continue our marketing efforts to attract self-directed low-carbohydrate and health motivated eaters (those individuals not on a program diet) who buy and consume our Atkins products.

For our Quest brand, we intend to continue our marketing efforts to reach consumers who are seeking products that are aligned with their choice to pursue a healthy and active lifestyle.

We also note the Atkins brand has approximately 96% aided brand awareness with U.S.

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Our mission is to empower healthy lives through smart and satisfying nutrition.

Core Quest Products

Our core Quest brand products consist of protein bars, cookies, salty snacks and confections.

Protein Bars.

To keep on-the-go consumers energized and fueled, our Quest bars offer a convenient and effective solution, providing consumers with protein, fiber and a delicious taste.

The typical Quest bar profile contains about 20 grams of protein, 5 grams or less of net carbs and about 1 gram of sugar.

Quest offers more than 25 different flavors of protein bars.

First launched in 2018, Quest’s cookie products are a convenient source of high-protein combined with low net carbs and low-sugar.

Available in a variety of flavors including Chocolate Chip, Peanut Butter, Oatmeal Raisin and Snickerdoodle, Quest’s cookies typically contain about 15 grams of protein, 4 grams or less of net carbs and less than 1 gram of sugar.

Quest also offers soft baked frosted cookies containing about 5 grams of protein, 1 grams of net carbs and less than 1 gram of sugar.

Salty Snacks .

Quest’s protein chips, including the tortilla-style chips launched in spring 2018, quickly became a high-selling product offering an attractive nutrition profile when compared to conventional chip products.

Offered in flavors including nacho cheese, ranch, chili lime, BBQ, loaded taco and spicy sweet chili, Quest’s chips typically contain about 18 grams of protein, about 4 grams of net

carbs, and around 6 grams of fat compared to 2 grams of protein, 15 grams of net carbs and 8 grams of fat for a well-known leading conventional brand.

Quest’s cheddar cheese crackers launched during fiscal year 2023, contain 10 grams of protein, 5 grams of net carbs and 7 grams of fat.

Quest’s confections include full-size and mini peanut butter cups, “fudgey” brownie, “gooey” caramel candy bites, chocolatey coated peanut candies and “coconutty” caramel candy bars sold in a variety of packaging.

The full-size peanut butter cups feature a nutrition profile for two cups of 11 grams of protein, 1 gram of net carbs, less than 1 gram of sugar and 4 grams of fiber.

The mini peanut butter cups feature a nutrition profile per serving of 8 grams of protein, 1 gram of net carbs, less than 1 gram of sugar and 3 grams of fiber.

The candy bars feature a nutrition profile of 12 grams of protein, 3 to 4 grams of net carbs, about 1 gram of sugar and about 9 grams of fiber.

The candy bites feature a nutrition profile of 5 grams of protein, 1 gram of net carbs, l to 3 grams of net carbs, about 1 gram of sugar and 4 to 9 grams of fiber.

Core Atkins Products

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While provided free of charge, we also offer over 1,600 protein-rich, low-carbohydrate and low-sugar recipes designed to help consumers achieve and maintain a healthy lifestyle, while still enjoying delicious food.

Core Quest Products

Our core Quest brand products consist of protein bars, cookies, chips and confections.

Protein Bars.

To keep on-the-go consumers energized and fueled, our Quest bars offer a convenient and effective solution, providing consumers with protein, fiber and a delicious taste.

The typical Quest bar profile contains about 20 grams of protein, 5 grams or less of net carbs and about 1 gram of sugar.

Quest offers more than 25 different flavors of protein bars.

First launched in 2018, Quest’s cookie products are a convenient source of high-protein combined with low net carbs and low-sugar.

Offered in flavors including nacho cheese, ranch, chili lime, BBQ, loaded taco and spicy sweet chili, Quest’s chips typically contain about 18 grams of protein, about 4 grams of net carbs, and around 6 grams of fat compared to 2 grams of protein, 15 grams of net carbs and 8 grams of fat for a well-known leading conventional brand.

Recently launched confections include full-size and mini peanut butter cups and “fudgey” brownie and “gooey” caramel candy bites sold in a variety of packaging.

The full-size peanut butter cups feature a nutrition profile for two cups of 11 grams of protein, 1 gram of net carbs, less than 1 gram of sugar and 4 grams of fiber.

The mini peanut butter cups feature a nutrition profile per serving of 8 grams of protein, 1 gram of net carbs, less than 1 gram of sugar and 3 grams of fiber.

The candy bites feature a nutrition profile of 5 grams of protein, 1 gram of net carbs, less than 1 gram of sugar, and candy bars feature 4 grams of fiber to 12 grams of protein, 3 grams of net carbs, 1 gram of sugar and 9 grams of fiber.

Marketing, Advertising and Consumer Outreach

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We use coupons (freestanding insert newspaper, store register, on-pack and online coupons) to help stimulate product trial and repeat purchases by providing consumers with economic incentives.

The mix of these marketing activities varies between the Atkins and Quest brands.

The mix of these marketing activities varies between the Quest and Atkins brands.

As part of our advocacy on the advantages of a protein-rich, low-carbohydrate, and low-sugar dietary approach, we have devoted portions of our respective brand websites and social media to promote consumer education, engagement, and dialogue about the benefits of our nutritional approaches and how our products can fit within those approaches.

Our sales and marketing team gathers information and feedback from consumers and retailers to enable us to better meet changing consumer needs.

We also believe that an effective marketing tool is to share educational information through our brand websites to explain each brand’s approach to nutrition, teaching consumers how to make smarter food choices and the nutritional qualities of our products.

We also believe that an effective marketing tool is to share educational information through our brand websites to explain each brand’s approach to nutrition and the nutritional qualities of our products.

We also provide access to consumer service representatives to answer questions and educate consumers on nutrition, new products and developments.

As part of this approach, over time, for those consumers who have elected to use weight

management medications to pursue their weight management goals we expect to develop and enhance our marketing messages regarding how we believe our products can be used to meet their snacking use occasions and be complementary to their use of medication for weight management to achieve and maintain their weight management goals.

For both brands, in order to facilitate awareness and knowledge of the health benefits of a low-carbohydrate, low-sugar and protein-rich eating approach, we have established a variety of marketing and advertising strategies to connect with consumers, including digital marketing and social media platforms, television broadcast and streaming advertising as well as celebrity and social media influencer endorsements.

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New flavors, textures and snacking formats are important to meeting consumer needs.

Management believes that an important component of meeting consumers’ nutritional needs is a focus on evolving current products and creating new products with cleaner and fewer ingredients.

Accordingly, we are committed to continually finding new and innovative formulations to reduce the number of ingredients in our products, as well as using “better-for-you” ingredients like nuts, fiber and whey protein, while continually improving taste and quality.

We believe an important component of meeting consumers’ nutritional needs is a focus on evolving current products.

We are committed to continually finding new and innovative formulations for our products, as well as using “better-for-you” ingredients like nuts, fiber and whey protein, while continually improving taste and quality.

We maintain an in-house research and development team as well as market research and consumer insight capabilities.

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We plan to continue conducting extensive consumer research to develop successful new products including product flavor and concept testing, marketing and trend analysis, and consumer prototype testing.

Management also believes the fragmented snacking category presents an opportunity for consolidation and the opportunity to build, through disciplined acquisitions, a leading platform in the nutritional snacking space.

As a leader in nutritious snacking,

management believes we have the unique capability to leverage our operating platform and customer relationships to expand beyond our current brands.

We also believe the fragmented snacking category presents an opportunity for consolidation and the opportunity to build, through disciplined acquisitions, a leading platform in the nutritional snacking space.

As a leader in nutritious snacking, we believe we have the unique capability to leverage our operating platform and customer relationships to expand beyond our current brands.

Our experienced management team has deep expertise in brand building to expand the business into additional brands and products in the nutritional snacking segment.

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The nutritional snacking industry is fragmented and highly competitive and includes a number of diverse competitors.

Our identified branded competitors include, but are not limited to, CLIF Bar, KIND bars, Special K, Boost, Slimfast, Muscle Milk, ONE bar, Pure Protein, Premier Nutrition and think!.

We believe that the principal competitive factors in the nutritional snacking and weight management industries are:

Our identified branded competitors include, but are not limited to, CLIF Bar, KIND bars, Boost, Premier Protein, Core Power, Fairlife, Muscle Milk, ONE bar, Pure Protein, Slimfast, and think!.

We believe that the principal competitive factors in the nutritional snacking industry are:

• brand awareness and loyalty among consumers;

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• product claims;

• product taste;

• product taste and texture;

• convenience of products;

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We believe that we currently compete effectively with respect to each of these factors.

However, a number of companies in the nutritional snacking and weight management industry have greater financial resources, more comprehensive product lines, broader market presence, longer standing relationships with distributors and suppliers, longer operating histories, greater distribution capabilities, stronger brand recognition, and greater marketing resources than we have.

However, a number of companies in the nutritional snacking industry have greater financial resources, more comprehensive product lines, broader market presence, longer standing relationships with distributors and suppliers, longer operating histories, greater distribution capabilities, stronger brand recognition, and greater marketing resources than we have.

We operate an asset-light business model.

For the manufacture of our products, we subcontract with contract manufacturers, and as a result, our operations are highly flexible and require minimal capital expenditure.

For the manufacture of our products, we contract with contract manufacturers, and as a result, our operations are highly flexible and require minimal capital expenditure.

The supply chain for our international business also uses exclusively contract manufacturers.

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We also have a separate warehouse for a portion of our distribution needs.

A substantial portion of our inventory is shipped directly to our retailers from this warehouse by the same third-party logistics provider.

A substantial portion of our inventory is shipped directly to our retailers from the warehouse by the same third-party logistics provider.

Most of our remaining customers pick-up their orders at our distribution centers and make their own arrangements for delivery to their fulfillment network.

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All of our core ingredients are purchased according to rigorous standards to assure food quality and safety.

These core ingredients are generally available in adequate quantities from several suppliers, and to date, most core ingredient supplies have largely not been affected by the supply chain challenges related to the COVID-19 pandemic or recent geopolitical events.

These core ingredients are generally available in adequate quantities from several suppliers.

We competitively bid with major suppliers to source competitively priced, quality ingredients and packaging that meet our standards.

For certain ingredients we establish direct purchasing agreements with suppliers, under which our contract manufacturers source ingredients to produce finished products.

We also actively manage the cost of most of our packaging supplies, such as corrugate, film, and tetra caps and cartons.

The cost of sourcing our ingredients and packaging has been affected by the

current elevated levels of supply chain cost inflation in the United States and elsewhere.

We also actively manage the cost of most of our packaging supplies, such as corrugate, film, and cartons.

The cost of sourcing our ingredients and packaging has been affected by the current elevated levels of supply chain cost inflation in the United States and elsewhere.

For more information, see “ – Business Trends in Fiscal Year 2023 ,” above.

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For the majority of our customers, our logistics provider distributes the finished goods via truckloads from our Distribution Centers, which first flow through regional terminals.

At the terminals, our orders are consolidated with other companies’ products being shipped to the customer.

At the terminals, our orders are consolidated with other companies’

products being shipped to the customer.

The finished goods are then distributed to retailer distribution centers.

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Sales to our largest retailer, Walmart, represented approximately 31% of consolidated sales in fiscal year 2023, of which approximately 24% is through their mass retail channel and approximately 7% is through their Sam’s club and e-commerce channels.

Sales to our next two largest retailers, Amazon and Target, represented approximately 13% and 10% of consolidated sales in fiscal year 2022, respectively.

Sales to our next largest retailer, Amazon, represented approximately 16% of consolidated sales in fiscal year 2023.

No other customer represents more than 10% of sales.

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We aim to ensure that our consumers may access our brand in the way that best suits their lifestyles by offering online ordering of our products.

We sell our products on Atkins.com , questnutrition.com, Amazon.com and e-commerce platforms of our brick-and-mortar customers, which all deliver our products directly to the location designated by the consumer.

We sell our products on questnutrition.com, Atkins.com , Amazon.com and e-commerce platforms of our brick-and-mortar customers, which all deliver our products directly to the location designated by the consumer.

Food Safety and Quality.

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Finally, random samples of finished goods are regularly sent to a third-party laboratory for testing.

In addition, during fiscal year 2022, we obtained ISO 22000 certification for our U.S.

We hold an ISO 22000 certification for our U.S.

operations, which we first obtained during fiscal year 2022.

International .

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We increasingly rely on cloud computing and other technologies that result in third parties holding significant amounts of customer, consumer or employee information on our behalf.

Except for limited information voluntarily submitted by users of our website, we typically do not collect or store consumer data or personal information.

However, third-party providers, including our licensees, contract manufacturers, e-commerce contractors and third-party sellers may do so.

The website operations of such third parties may be affected by reliance on other third-party hardware and software providers, technology changes, risks related to the failure of computer systems through which these website operations are conducted, telecommunications failures, data security breaches and similar disruptions.

We along with our third party service providers, including our licensees, contract manufacturers, e-commerce contractors and third-party sellers, collect information about consumers directly from them as well as automatically through their use of our websites.

We collect information from consumers when they interact with our websites and the services we offer on those sites.

The information we collect varies based on the consumer’s particular interaction with our websites.

We may combine this information with other information that we collect.

We and our third-party service providers may use cookies and other similar tracking technologies to track information about consumers’ use of our websites and the services we offer on those websites.

The website operations of our third parties may be affected by reliance on other third-party hardware and software providers, technology changes, risks related to the failure of computer systems through which these website operations are conducted, telecommunications failures, data security breaches and similar disruptions.

During the fifty-two weeks ended August 27, 2022, we substantially completed our efforts to fully integrate our operations and organization structure after the Quest Acquisition.

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Additionally, our chief operating decision maker reviews operating results and forecasts at the consolidated level.

As a result, we determined our operations are organized into one, consolidated operating segment and reportable segment.

As a result, we determined our operations are appropriately still organized into one, consolidated operating segment and reportable segment.

Regulation and Compliance

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• specifies the standards of identity for certain foods, including many of the products we sell;

• regulates the advertising claims that can be made on food product labels;

• prescribes the format and content of certain information required to appear on food product labels.

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These initiatives include the following, among others:

• We hired a third-party DE&I consultant to survey our employees and provide guidance and best practice inputs to our management and the Corporate Responsibility & Sustainability Committee, as we continue to make progress on our DE&I efforts.

• During fiscal year 2022, we established a Diversity, Equity, Inclusion and Belonging Council consisting of mid-level and senior leaders so our DE&I efforts are informed and led by a cross section of our leaders.

• In 2022, we established a Diversity, Equity, Inclusion and Belonging Council consisting of mid-level and senior leaders so our DE&I efforts are informed and led by a cross section of our leaders.

Its mission is to foster a positive, open, and trusted culture of belonging where every person feels empowered to bring their unique selves to the workplace resulting in a competitive advantage through thought-leadership and talent growth that halos beyond our workforce to our partners and community, creating an inclusive ecosystem.

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This practice provides every qualified candidate an opportunity to apply with knowledge of the range of pay for the role.

• We are committed to interviewing diverse candidates for open corporate leadership positions.

• Environmental, social and governance (“ESG”) initiatives are included as part of the determination of the discretionary component of our annual short-term incentive program.

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1 Minority representation includes the percent of United States employees who identify as Black or African American, Asian, Hispanic, Native American, or two or more races.

The table below provides information for the period December 1, 2021 through December 15, 2021in our 2021 EEO-1 report.

We have condensed the EEO-1 report to eliminate rows and columns that have no employees in this report or in the previous year’s report total.

This table shows our gender, racial, and ethnic composition by EEO-1 job category as set forth in the Section D Employment Data section of the Consolidated EEO-1 Report that we filed with the U.S.

Equal Employment Opportunity Commission (EEOC) in 2022.

The information is provided for the time period that is consistent with the report’s filing instructions.

Not-Hispanic or Latino

Hispanic or Latino Male Female

Job Categories Male Female White Black or African American Asian American Indian or Alaskan Native Two or More Races White Black or African American Native Hawaiian or Pacific Islander Asian Two or More Races Overall Totals

Executives/Senior Officials & Managers — — 10 — — — — 3 — — — — 13

First/Mid Officials & Managers 1 6 38 2 5 — 3 32 — — 8 — 95

Professionals 7 10 20 3 4 1 1 39 3 — 4 3 95

Technicians 1 1 2 — — — — 2 — — — — 6

Sales Workers 2 — 10 — — — — 5 — — — 1 18

Administrative Support — 8 2 — 1 — — 9 2 — 1 — 23

Total 11 25 82 5 10 1 4 90 5 — 13 4 250

Previous Report Total 14 27 74 4 9 — 7 82 5 1 18 4 245

In our Form 10-K for the fiscal year ended August 27, 2022, we provided a table of information for the period December 1, 2021 through December 15, 2021 from our 2021 EEO-1 report.

Earlier this year, the U.S.

Equal Employment and Opportunity Commission determined to delay the timeline for the submission of data to complete the 2022 EEO-1 report.

Data submission for our 2022 EEO-1 report is now scheduled for the period from October 31, 2023, through December 5, 2023.

As a result, updated information from our 2022 EEO-1 report is not available as of the filing date of this Form 10-K.

Employee Culture .

We regularly ask our employees to respond to pulse surveys to gather feedback on topics ranging from organization changes to overall engagement and inclusion.

We regularly ask our employees to respond to engagement surveys to gather feedback on topics ranging from teamwork to, growth, job satisfaction, engagement and inclusion.

This encourages open communication with employees and management, and tracks employee engagement over time.

We use the information we gain from the surveys to inform our strategy and actions as we continue to work towards improving our culture.

We have also committed to summarizing results for each survey and providing responses quickly after the surveys close.

Total Rewards.

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We also offer time-off benefits including vacation time, flexible vacation for exempt positions, sick leave, and paid parental leave.

Employee Safety and Wellbeing Measures.

After over two years of working remotely due to the COVID-19 pandemic, we returned to our offices in the United States on May 31, 2022.

In continuing our focus on keeping our teams safe, we continue to follow local regulations for each of our offices.

We recognize the importance of balance in our employees’ lives to their overall wellbeing, so we offer our employees time off benefits described above to recharge, ten company-paid holidays per year, flexible remote workdays every Monday and Friday, and paid parental leave.

We also had one company-wide mental health day in April 2022 and encouraged employees to take extra time away from work to recharge in late December 2021.

Advancing Health, Nutrition and Wellbeing.

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In addition, we have sponsored numerous continuing education courses for registered dieticians and other healthcare professionals, and we are a member of multiple collaborative groups focused on improving the nutritional quality of the U.S.

Through our websites and social media, we also share educational information to explain each brand’s approach to nutrition, teaching consumers how to make smarter food choices and the nutritional qualities of our nutritional approach and our products.

our nutritional approaches and how our products can fit within those approaches.

Our Atkins website also offers free of charge information regarding the Atkins protein-rich, low-carbohydrate and low-sugar approach to eating, several tools to assist consumers in pursuing the Atkins approach and over 1,600 recipes designed to help consumers achieve and maintain a healthy lifestyle, while still enjoying delicious food.

In late 2021, we launched The Quest Challenge, a grant program for individuals who are making a difference in their community in support of health and wellness.

In our inaugural year, we provided four separate $20,000 grants.

The Quest Challenge grant was awarded following a competitive process in which applicants expressed their current philanthropic work and what they aim to achieve if they received the grant.

Recipients of this year’s grant have used this money to improve the health and wellbeing of underserved and at-risk children, create safe spaces for children to play or learn a new skill, and encourage physical and artistic activities to build confidence and self-esteem.

In late 2021, we launched Quest for Impact, formerly known as The Quest Challenge, a grant program for individuals who are making a difference in their community in support of health and wellness.

In 2023, we provided four separate $20,000 grants.

The Quest for Impact grants were awarded following a competitive process in which applicants expressed their current philanthropic work and what they aim to achieve if they received the grant.

Recipients of this year’s grant have used this money to provide life enrichment skills for individuals with autism and special needs, empower and provide skills development for underserved individuals and communities, and support programs designed to develop student’s minds and prepare them for the complexities and demands of the world.

We will continue to follow the progress of our past recipients and their effect on their communities.

For the second year, we participated in Walmart’s “Fight Hunger.

For the third year, we participated in Walmart’s “Fight Hunger.

Spark Change.” campaign.

For each purchase of participating Simply Good Foods’ Atkins and Quest products at Walmart from April 18 – May 15, 2022, we donated the monetary equivalent of at least one meal to Feeding America.

For each purchase of participating Simply Good Foods’ Atkins and Quest products at Walmart during the campaign, we donated the monetary equivalent of at least one meal to Feeding America.

Through this program, Simply Good Foods secured at least 500,000 meals for Feeding America.

Additionally, we encourage and support our employees to give back to charities they are passionate about, and we match up to $100 of each employee’s donations.

In 2023 we sponsored a Community Impact Day for our employees to volunteer in their communities in support of our commitment to help improve nutrition and overall wellness in the United States through scientific research, education, advocacy, and community engagement.

We partnered with five organizations in five cities where our employees have a presence:

El Segundo, CA;

Minneapolis, MN;

Bentonville, AR, and Cincinnati, OH.

Over 110 Simply Good Foods employees volunteered, building awareness about nutrition security, and striving to help end hunger in the U.S.

by centering this volunteer event around Community Gardens, a place where people come together to access affordable, healthy food options.

Available Information

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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 1. Business