What changed in this filing

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Item 1. Financial Statements

2024-04-04 compared with 2024-01-04 · 97 added, 75 removed, 398 unchanged (30% of the section changed)

3 unchanged sentences

(Unaudited, dollars in thousands, except share and per share data)

November 25, 2023 August 26, 2023

February 24, 2024 August 26, 2023

Current assets:

39 unchanged sentences

Preferred stock, $0.01 par value, 100,000,000 shares authorized, none issued

Common stock, $0.01 par value, 600,000,000 shares authorized, 102,175,233 and 101,929,868 shares issued at November 25, 2023 and August 26, 2023, respectively 1,022 1,019

Treasury stock, 2,365,100 shares and 2,365,100 shares at cost at November 25, 2023 and August 26, 2023, respectively ( 78,451 ) ( 78,451 )

Common stock, $0.01 par value, 600,000,000 shares authorized, 102,353,618 and 101,929,868 shares issued at February 24, 2024 and August 26, 2023, respectively 1,024 1,019

Treasury stock, 2,365,100 shares and 2,365,100 shares at cost at February 24, 2024 and August 26, 2023, respectively ( 78,451 ) ( 78,451 )

Additional paid-in-capital

11 unchanged sentences

(Unaudited, dollars in thousands, except share and per share data)

Thirteen Weeks Ended

November 25, 2023 November 26, 2022

Thirteen Weeks Ended Twenty-Six Weeks Ended

February 24, 2024 February 25, 2023 February 24, 2024 February 25, 2023

Net sales $ 312,199 $ 296,584 $ 620,877 $ 597,462

10 unchanged sentences

Interest expense ( 5,596 ) ( 8,497 ) ( 11,630 ) ( 15,552 )

Gain on foreign currency transactions 226 108

(Loss) gain on foreign currency transactions ( 23 ) ( 214 ) 203 ( 106 )

Other income — — 6 6

16 unchanged sentences

(Unaudited, dollars in thousands)

Thirteen Weeks Ended

November 25, 2023 November 26, 2022

Twenty-Six Weeks Ended

February 24, 2024 February 25, 2023

Operating activities

4 unchanged sentences

Stock compensation expense 8,736 6,332

Estimated credit losses 51 ( 141 )

Unrealized gain on foreign currency transactions ( 226 ) ( 108 )

Estimated credit (gains) losses ( 140 ) 219

Unrealized (loss) gain on foreign currency transactions ( 203 ) 106

Deferred income taxes 7,722 6,845

11 unchanged sentences

Net cash provided by operating activities

93,991 53,346

Investing activities

18 unchanged sentences

$ 135,876 $ 63,207

Thirteen Weeks Ended

November 25, 2023 November 26, 2022

Twenty-Six Weeks Ended

February 24, 2024 February 25, 2023

Supplemental disclosures of cash flow information

2 unchanged sentences

Cash paid for taxes

$ 14,884 $ 15,747

Non-cash investing and financing transactions

16 unchanged sentences

Balance at November 25, 2023 102,175,233 $ 1,022 2,365,100 $ (78,451) $ 1,303,411 $ 383,517 $ (2,321) $ 1,607,178

Net income — — — — — 33,123 — 33,123

Stock-based compensation — — — — 4,288 — — 4,288

Foreign currency translation adjustments — — — — — — ( 15 ) ( 15 )

Repurchase of common stock — — — — — — — —

Shares issued upon vesting of restricted stock units 5,285 — — — ( 107 ) — — ( 107 )

Exercise of options to purchase common stock 173,100 2 — — 3,013 — — 3,015

Balance at February 24, 2024 102,353,618 $ 1,024 2,365,100 $ (78,451) $ 1,310,605 $ 416,640 $ (2,336) $ 1,647,482

Common Stock Treasury Stock Additional Paid-In Capital Retained Earnings Accumulated Other Comprehensive Loss Total

3 unchanged sentences

Stock-based compensation — — — — 3,237 — — 3,237

Repurchase of Common Stock — — 546,346 ( 16,448 ) — — — ( 16,448 )

Foreign currency translation adjustments — — — — — — ( 222 ) ( 222 )

Repurchase of common stock — — 546,346 ( 16,448 ) — — — ( 16,448 )

Shares issued upon vesting of restricted stock units and performance stock units 180,342 2 — — ( 2,300 ) — — ( 2,298 )

1 unchanged sentence

Balance at November 26, 2022 101,856,457 $ 1,019 2,365,100 $ (78,451) $ 1,292,720 $ 250,241 $ (2,173) $ 1,463,356

Net income — — — — — 25,642 — 25,642

Stock-based compensation — — — — 2,739 — — 2,739

Foreign currency translation adjustments — — — — — — 53 53

Repurchase of common stock — — — — — — — —

Shares issued upon vesting of restricted stock units 4,584 — — — ( 103 ) — — ( 103 )

Exercise of options to purchase common stock 12,130 — — — 228 — — 228

Balance at February 25, 2023 101,873,171 $ 1,019 2,365,100 $ (78,451) $ 1,295,584 $ 275,883 $ (2,120) $ 1,491,915

See accompanying notes to the unaudited consolidated financial statements.

36 unchanged sentences

The Company does not anticipate the amendments in this ASU will be material to its consolidated financial statements.

In November 2023, the Financial Accounting Standards Board (“FASB”) issues Accounting Standard Update (“ASU”) No.

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures, which updates reportable segment disclosure requirements primarily through enhanced disclosures about significant segment expenses.

Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which updates reportable segment disclosure requirements primarily through enhanced disclosures about significant segment expenses.

The amendments are effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024.

2 unchanged sentences

The Company is currently evaluating the provisions of the amendments and the effect on its future consolidated financial statements.

In December 2023, the Financial Accounting Standards Board (“FASB”) issued ASU No.

2023-09, Income Taxes (Topic 740), Improvements to Income Tax Disclosures (“ASU 2023-09”), which updates disclosures required in the footnotes to the financial statements to further aid investors in understanding how to analyze income tax reporting.

The amendments are effective for fiscal years beginning after December 15, 2024.

Early adoption is permitted for annual financial statements that have not yet been issued or made available.

The amendments should be applied on a prospective basis, however, retrospective application is permitted.

The Company is currently evaluating the provisions of the amendments and the effect on its future consolidated financial statements.

No other new accounting pronouncement issued or effective during the fiscal year had or is expected to have a material effect on the Company’s consolidated financial statements.

2 unchanged sentences

The following is a summary of revenue disaggregated by geographic area and brands:

Thirteen Weeks Ended

(In thousands) November 25, 2023 November 26, 2022

Thirteen Weeks Ended Twenty-Six Weeks Ended

(In thousands) February 24, 2024 February 25, 2023 February 24, 2024 February 25, 2023

North America (1)

5 unchanged sentences

(1) The North America geographic area consists of net sales substantially related to the United States and there is no individual foreign country to which more than 10% of the Company’s net sales are attributed or that is otherwise deemed individually material.

Charges related to credit loss on accounts receivables from transactions with external customers were $ 0.1 million for the thirteen weeks ended November 25, 2023, and $( 0.1 ) million for the thirteen weeks ended November 26, 2022.

As of November 25, 2023 and August 26, 2023, the allowances for doubtful accounts related to these accounts receivable were $ 0.9 million and $ 1.1 million, respectively.

Additionally, as of November 25, 2023, the Company had an expected credit loss reserve of $ 1.0 million on a $ 3.0 million note receivable related to the Company’s sale of its SimplyProtein® brand and related assets during its fiscal year 2021.

Charges related to credit loss on accounts receivable from transactions with external customers were $( 0.2 ) million and $( 0.1 ) million for the thirteen and twenty-six weeks ended February 24, 2024, respectively.

Charges related to credit loss on accounts receivables from transactions with external customers were $ 0.4 million and $ 0.2 million for the thirteen and twenty-six weeks ended February 25, 2023, respectively.

As of February 24, 2024, and August 26, 2023, the allowances for doubtful accounts related to these accounts receivable were $ 0.7 million and $ 1.9 million, respectively.

Goodwill and Intangibles

As of November 25, 2023 and August 26, 2023, Goodwill in the Consolidated Balance Sheets was $ 543.1 million.

There were no impairment charges related to goodwill during the thirteen weeks ended November 25, 2023 or since the inception of the Company.

As of February 24, 2024, and August 26, 2023, Goodwill in the Consolidated Balance Sheets was $ 543.1 million.

There were no impairment charges related to goodwill during the thirteen and twenty-six weeks ended February 24, 2024, or since the inception of the Company.

Intangible assets, net in the Consolidated Balance Sheets consists of the following:

November 25, 2023

February 24, 2024

(In thousands) Useful life Gross carrying amount Accumulated amortization Net carrying

19 unchanged sentences

$ 1,183,407 $ 75,288 $ 1,108,119

Changes in Intangible assets, net during the thirteen weeks ended November 25, 2023 were primarily related to recurring amortization expense.

Amortization expense related to intangible assets was $ 3.9 million for the thirteen weeks ended November 25, 2023 and $ 3.9 million for the thirteen weeks ended November 26, 2022.

There were no impairment charges related to intangible assets during the thirteen weeks ended November 25, 2023 and November 26, 2022.

Changes in Intangible assets, net during the twenty-six weeks ended February 24, 2024, were primarily related to recurring amortization expense.

Amortization expense related to intangible assets was $ 3.8 million and $ 3.9 million for the thirteen weeks ended February 24, 2024, and February 25, 2023, respectively, and $ 7.7 million and $ 7.8 million for the twenty-six weeks ended February 24, 2024, and February 25, 2023, respectively.

There were no impairment charges related to intangible assets during the thirteen and twenty-six weeks ended February 24, 2024 and February 25, 2023.

Estimated future amortization for each of the next five fiscal years and thereafter is as follows:

32 unchanged sentences

The Credit Agreement contains certain financial and other covenants that limit the Company’s ability to, among other things, incur and/or undertake asset sales and other dispositions, liens, indebtedness, certain acquisitions and investments, consolidations, mergers, reorganizations and other fundamental changes, payment of dividends and other distributions to equity and warrant holders, and prepayments of material subordinated debt, in each case, subject to customary exceptions materially consistent with credit facilities of such type and size.

The Revolving Credit Facility has a maximum total net leverage ratio equal to or less than 6.00 :1.00 contingent on credit

extensions in excess of 30 % of the total amount of commitments available under the Revolving Credit Facility.

The Revolving Credit Facility has a maximum total net leverage ratio equal to or less than 6.00 :1.00 contingent on credit extensions in excess of 30 % of the total amount of commitments available under the Revolving Credit Facility.

Any failure to comply with the restrictions of the credit facilities may result in an event of default.

The Company was in compliance with all covenants as of November 25, 2023 and August 26, 2023, respectively.

The Company was in compliance with all covenants as of February 24, 2024 and August 26, 2023, respectively.

Long-term debt consists of the following:

(In thousands) November 25, 2023 August 26, 2023

Term Facility (effective rate of 8.0% at November 25, 2023)

(In thousands) February 24, 2024 August 26, 2023

Term Facility (effective rate of 7.9% at February 24, 2024)

$ 240,000 $ 285,000

Finance lease liabilities (effective rate of 5.6% at November 25, 2023)

Finance lease liabilities (effective rate of 5.6% at February 24, 2024)

Deferred financing fees 2,359 3,351

2 unchanged sentences

Long-term debt, net of deferred financing fees $ 237,641 $ 281,649

The Company is no t required to make principal payments on the Term Facility over the twelve months following the period ended November 25, 2023.

The Company is no t required to make principal payments on the Term Facility over the twelve months following the period ended February 24, 2024.

The outstanding balance of the Term Facility is due upon its maturity in March 2027.

As of November 25, 2023, the Company had letters of credit in the amount of $ 3.5 million outstanding.

As of February 24, 2024, the Company had letters of credit in the amount of $ 3.2 million outstanding.

These letters of credit offset against the $ 75.0 million availability of the Revolving Credit Facility and exist to support three of the Company’s leased buildings and insurance programs relating to workers’ compensation.

No amounts were drawn against these letters of credit at November 25, 2023.

No amounts were drawn against these letters of credit as of February 24, 2024.

The Company utilizes market approaches to estimate the fair value of certain outstanding borrowings by discounting anticipated future cash flows derived from the contractual terms of the obligations and observable market interest and foreign exchange rates.

The Company carries debt at historical cost and discloses fair value.

As of November 25, 2023 and August 26, 2023, the book value of the Company’s debt approximated fair value.

As of February 24, 2024, and August 26, 2023, the book value of the Company’s debt approximated fair value.

The estimated fair value of the Term Loan is valued based on observable inputs and classified as Level 2 in the fair value hierarchy.

6 unchanged sentences

These valuations require significant judgment.

Components of the balance sheet such as accounts receivable, cash and cash equivalents and others approximated fair value as of November 25, 2023.

Components of the balance sheet such as accounts receivable, cash and cash equivalents and others approximated fair value as of February 24, 2024.

The tax expense and the effective tax rate resulting from operations were as follows:

Thirteen Weeks Ended

(In thousands) November 25, 2023 November 26, 2022

Twenty-Six Weeks Ended

(In thousands) February 24, 2024 February 25, 2023

Income before income taxes $ 90,496 $ 79,596

1 unchanged sentence

Effective tax rate 24.1 % 22.7 %

The effective tax rate for the thirteen weeks ended November 25, 2023 was 3.2 % more than the effective tax rate for the thirteen weeks ended November 26, 2022, which was primarily driven by permanent differences.

The effective tax rate for the twenty-six weeks ended February 24, 2024, was 1.4 % more than the effective tax rate for the twenty-six weeks ended February 25, 2023, which was primarily driven by permanent differences.

The components of lease expense were as follows:

Thirteen Weeks Ended

(In thousands) Statements of Operations Caption November 25, 2023 November 26, 2022

Thirteen Weeks Ended Twenty-Six Weeks Ended

(In thousands) Statements of Operations Caption February 24, 2024 February 25, 2023 February 24, 2024 February 25, 2023

Operating lease cost:

10 unchanged sentences

The right-of-use assets and corresponding liabilities related to both operating and finance leases are as follows:

(In thousands) Balance Sheets Caption November 25, 2023 August 26, 2023

(In thousands) Balance Sheets Caption February 24, 2024 August 26, 2023

Operating lease right-of-use assets Other long-term assets $ 36,532 $ 40,022

6 unchanged sentences

Total lease liabilities $ 41,182 $ 44,981

Future maturities of lease liabilities as of November 25, 2023 were as follows:

Future maturities of lease liabilities as of February 24, 2024, were as follows:

(In thousands) Operating Leases Finance Leases

6 unchanged sentences

The weighted-average remaining lease terms and weighted-average discount rates for operating and finance leases were as follows:

November 25, 2023 August 26, 2023

February 24, 2024 August 26, 2023

Weighted-average remaining lease term (in years)

5 unchanged sentences

Supplemental and other information related to leases was as follows:

Thirteen Weeks Ended

(In thousands) November 25, 2023 November 26, 2022

Twenty-Six Weeks Ended

(In thousands) February 24, 2024 February 25, 2023

Cash paid for amounts included in the measurement of lease liabilities

8 unchanged sentences

These contracts contain endorsement fees, which are expensed ratably over the life of the contract, and performance fees, that are recognized at the time of achievement.

Based on the terms of the contracts in place and achievement of performance conditions as of November 25, 2023, the Company will be required to make payments of $ 2.9 million over the next year.

Based on the terms of the contracts in place and achievement of performance conditions as of February 24, 2024, the Company will be required to make payments of $ 3.0 million over the next year.

Stockholders’ Equity

5 unchanged sentences

The stock repurchase program may be suspended or discontinued at any time by the Company and does not have an expiration date.

The Company did not repurchase any shares of common stock during the thirteen weeks ended November 25, 2023.

During the thirteen weeks ended November 26, 2022, the Company repurchased 546,346 shares of common stock at an average share price of $ 30.11 per share.

As of November 25, 2023, approximately $ 71.5 million remained available under the stock repurchase program.

The Company did not repurchase any shares of common stock during the twenty-six weeks ended February 24, 2024.

During the twenty-six weeks ended February 25, 2023, the Company repurchased 546,346 shares of common stock at an average share price of $ 30.11 per share.

As of February 24, 2024, approximately $ 71.5 million remained available under the stock repurchase program.

Earnings Per Share

3 unchanged sentences

The following table reconciles the numerators and denominators used in the computations of both basic and diluted earnings per share:

Thirteen Weeks Ended

(In thousands, except per share data) November 25, 2023 November 26, 2022

Thirteen Weeks Ended Twenty-Six Weeks Ended

(In thousands, except per share data) February 24, 2024 February 25, 2023 February 24, 2024 February 25, 2023

Basic earnings per share computation:

10 unchanged sentences

Diluted earnings per share from net income $ 0.33 $ 0.25 $ 0.68 $ 0.61

Diluted earnings per share calculations for the thirteen weeks ended November 25, 2023 and November 26, 2022 excluded 0.8 million and 0.4 million shares of common stock issuable upon exercise of stock options, respectively, that would have been anti-dilutive.

Diluted earnings per share calculations for the thirteen weeks ended November 25, 2023 and November 26, 2022 excluded an immaterial number of shares and 0.1 million shares of non-vested stock units, respectively, that would have been anti-dilutive.

Diluted earnings per share calculations for the thirteen and twenty-six weeks ended February 24, 2024 excluded 0.6 million and 0.8 million shares of common stock issuable upon exercise of stock options, respectively, that would have been anti-dilutive.

Diluted earnings per share calculations for the thirteen and twenty-six weeks ended and February 25, 2023, excluded 0.6 million and 0.5 million shares of common stock issuable upon exercise of stock options, respectively, that would have been anti-dilutive.

Diluted earnings per share calculations for the thirteen and twenty-six weeks ended February 24, 2024, excluded an immaterial number of non-vested stock units that would have been anti-dilutive.

Diluted earnings per share calculations for the thirteen and twenty-six weeks ended February 25, 2023, excluded 0.1 million shares of non-vested stock units that would have been anti-dilutive.

Omnibus Incentive Plan

2 unchanged sentences

Stock-based compensation expense is included within General and administrative expense, which is the same financial statement caption where the recipient’s other compensation is reported.

The Company recorded stock-based compensation expense of $ 4.2 million and $ 3.3 million in the thirteen weeks ended November 25, 2023 and November 26, 2022, respectively.

The Company recorded stock-based compensation expense of $ 4.6 million and $ 3.0 million in the thirteen weeks ended February 24, 2024, and February 25, 2023, respectively, and $ 8.7 million and $ 6.3 million in the twenty-six weeks ended February 24, 2024, and February 25, 2023, respectively.

Stock Options

The following table summarizes stock option activity for the thirteen weeks ended November 25, 2023:

The following table summarizes stock option activity for the twenty-six weeks ended February 24, 2024:

Shares underlying options Weighted average

4 unchanged sentences

Forfeited ( 7,014 ) 39.38

Outstanding as of November 25, 2023 2,682,280 $ 20.47 5.35

Vested and expected to vest as of November 25, 2023 2,682,280 $ 20.47 5.35

Exercisable as of November 25, 2023 2,188,820 $ 16.69 4.64

As of November 25, 2023, the Company had $ 4.8 million of total unrecognized compensation cost related to stock options that will be recognized over a weighted average period of 1.5 years.

During the thirteen weeks ended November 25, 2023 the Company did not receive cash from stock option exercises.

During the thirteen weeks ended November 26, 2022, the Company received $ 4.6 million in cash from stock option exercises.

Outstanding as of February 24, 2024 2,505,981 $ 20.65 5.15

Vested and expected to vest as of February 24, 2024 2,505,981 $ 20.65 5.15

Exercisable as of February 24, 2024 2,017,921 $ 16.64 4.39

As of February 24, 2024, the Company had $ 3.9 million of total unrecognized compensation cost related to stock options that will be recognized over a weighted average period of 1.3 years.

During the twenty-six weeks ended February 24, 2024, and February 25, 2023, the Company received $ 3.0 million and $ 4.8 million in cash from stock option exercises, respectively.

Restricted Stock Units

The following table summarizes restricted stock unit activity for the thirteen weeks ended November 25, 2023:

The following table summarizes restricted stock unit activity for the twenty-six weeks ended February 24, 2024:

Units Weighted average

4 unchanged sentences

Forfeited ( 8,928 ) 38.78

Non-vested as of November 25, 2023 550,023 $ 37.47

As of November 25, 2023, the Company had $ 15.6 million of total unrecognized compensation cost related to restricted stock units that will be recognized over a weighted average period of 1.8 years.

Non-vested as of February 24, 2024 556,721 $ 37.55

As of February 24, 2024, the Company had $ 13.5 million of total unrecognized compensation cost related to restricted stock units that will be recognized over a weighted average period of 1.6 years.

Performance Stock Units

During the thirteen weeks ended November 25, 2023, the Company granted performance stock units under its equity compensation plan.

During the twenty-six weeks ended February 24, 2024, the Company granted performance stock units under its equity compensation plan.

Performance stock units vest in a range between 0 % and 200 % based upon certain performance criteria in a three -year period.

Performance stock units were valued using a Monte Carlo simulation.

The following table summarizes performance stock unit activity for the thirteen weeks ended November 25, 2023:

The following table summarizes performance stock unit activity for the twenty-six weeks ended February 24, 2024:

Units Weighted average

4 unchanged sentences

Forfeited — —

Non-vested as of November 25, 2023 180,683 $ 59.28

As of November 25, 2023, the Company had $ 7.6 million of total unrecognized compensation cost related to performance stock units that will be recognized over a weighted average period of 2.2 years.

Non-vested as of February 24, 2024 180,683 $ 59.28

As of February 24, 2024, the Company had $ 6.6 million of total unrecognized compensation cost related to performance stock units that will be recognized over a weighted average period of 1.9 years.

Stock Appreciation Rights

1 unchanged sentence

The Company’s SARs settle in shares of its common stock once the applicable vesting criteria have been met.

The SARs outstanding as of November 25, 2023 cliff vest two years from the date of grant and must be exercised within five years .

The following table summarizes SARs activity for the thirteen weeks ended November 25, 2023:

The SARs outstanding as of February 24, 2024, cliff vest two years from the date of grant and must be exercised within five years .

The following table summarizes SARs activity for the twenty-six weeks ended February 24, 2024:

Shares underlying SARs Weighted average

3 unchanged sentences

Forfeited — —

Outstanding as of November 25, 2023 150,000 $ 37.67

The SARs exercised in the thirteen weeks ended November 26, 2022 resulted in a net issuance of 38,850 shares of the Company’s common stock.

The SARs granted in the thirteen weeks ended November 26, 2022 are liability-classified;

Outstanding as of February 24, 2024 150,000 $ 37.67

The SARs exercised in the twenty-six weeks ended February 25, 2023, resulted in a net issuance of 38,850 shares of the Company’s common stock.

The SARs granted in the twenty-six weeks ended February 25, 2023, are liability-classified;

therefore the related stock-based compensation expense is based on the vesting provisions and the fair value of the awards.

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-Q

Item 1. Financial Statements