What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2024-04-04 compared with 2024-01-04 · 118 added, 58 removed, 159 unchanged (53% of the section changed)

23 unchanged sentences

During fiscal 2023, the Company was affected by the unfavorable effects of higher raw material costs, higher co-manufacturing costs, and supply chain challenges, including supply chain disruptions resulting from labor shortages and disruptions in ingredients.

During the thirteen weeks ended November 25, 2023, our business performance improved as strong Quest sales volume growth more than offset Atkins softness.

The Company benefited from lower ingredient and packaging costs which resulted in gross margin expansion versus the year ago period.

During the thirteen and twenty-six weeks ended February 24, 2024, our business performance improved as strong Quest sales volume more than offset continued softness in Atkins.

The Company benefited from lower ingredient and packaging costs which resulted in gross margin expansion versus fiscal 2023.

The Company continues to engage and have discussions with its contract manufacturers and logistics and transportation providers to have its cost structure reflect lower market prices.

We believe the Company's strategy and positioning will continue to drive profitable growth for our product offerings and growth within the growing nutritional snacking category.

We continue to actively monitor the dynamic supply chain environment in the United States and elsewhere as well as consumer purchasing behavior.

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

Key Financial Definitions

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Results of Operations

During the thirteen weeks ended November 25, 2023, our net sales increased to $308.7 million compared to $300.9 million for the thirteen weeks ended November 26, 2022, driven by Quest volume growth, which offset softness in Atkins net sales, resulting in a 2.6% increase in our aggregate North America net sales.

During the thirteen weeks ended February 24, 2024, our net sales increased to $312.2 million compared to $296.6 million for the thirteen weeks ended February 25, 2023, driven by Quest volume growth, which more than offset continued softness in Atkins net sales, resulting in a 5.1% increase in our aggregate North America net sales.

Gross profit and gross profit margin improved driven by higher sales volumes and lower ingredient and packaging costs.

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See “Reconciliation of EBITDA and Adjusted EBITDA” below for a reconciliation of EBITDA and Adjusted EBITDA to net income for each applicable period.

Comparison of Unaudited Results for the Thirteen Weeks Ended November 25, 2023 and the Thirteen Weeks Ended November 26, 2022

Comparison of Unaudited Results for the Thirteen Weeks Ended February 24, 2024, and the Thirteen Weeks Ended February 25, 2023

The following unaudited table presents, for the periods indicated, selected information from our Consolidated Statements of Operations and Comprehensive Income, including information presented as a percentage of net sales:

Thirteen Weeks Ended Thirteen Weeks Ended

(In thousands) November 25, 2023 % of Net Sales November 26, 2022 % of Net Sales

(In thousands) February 24, 2024 % of Net Sales February 25, 2023 % of Net Sales

Net sales $ 312,199 100.0 % $ 296,584 100.0 %

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Interest expense (5,596) (1.8) % (8,497) (2.9) %

Gain on foreign currency transactions 226 0.1 % 108 — %

(Loss) on foreign currency transactions (23) — % (214) (0.1) %

Other income — — % — — %

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See “Reconciliation of EBITDA and Adjusted EBITDA” below for a reconciliation of net income to EBITDA and Adjusted EBITDA for each applicable period.

Net sales were $308.7 million for the thirteen weeks ended November 25, 2023 compared to $300.9 million for the thirteen weeks ended November 26, 2022, representing an increase of $7.8 million, driven primarily by Quest volume growth which offset Atkins softness.

North America net sales increased 2.6% in the thirteen weeks ended November 25, 2023 compared to the thirteen weeks ended November 26, 2022, and International net sales increased 0.7% during the same period.

Net sales were $312.2 million for the thirteen weeks ended February 24, 2024, compared to $296.6 million for the thirteen weeks ended February 25, 2023, representing an increase of $15.6 million, driven primarily by Quest volume growth which offset Atkins softness.

North America net sales increased 5.1% in the thirteen weeks ended February 24, 2024, compared to the thirteen weeks ended February 25, 2023, and International net sales increased 12.2% during the same period.

Cost of goods sold .

Cost of goods sold increased $3.7 million, or 1.9%, for the thirteen weeks ended November 25, 2023 compared to the thirteen weeks ended November 26, 2022.

The cost of goods sold increase was primarily driven by higher sales volumes in the thirteen weeks ended November 25, 2023.

Cost of goods sold increased $1.5 million, or 0.8%, for the thirteen weeks ended February 24, 2024, compared to the thirteen weeks ended February 25, 2023.

The cost of goods sold increase was primarily driven by higher sales volumes in the thirteen weeks ended February 24, 2024.

Gross profit.

Gross profit increased by $4.1 million, or 3.7%, for the thirteen weeks ended November 25, 2023 compared to the thirteen weeks ended November 26, 2022.

Additionally, gross profit of $115.1 million, or 37.3% of net sales, for the thirteen weeks ended November 25, 2023 increased 40 basis points from 36.9% of net sales for the thirteen weeks ended November 26, 2022.

Gross profit increased by $14.1 million, or 13.8%, for the thirteen weeks ended February 24, 2024, compared to the thirteen weeks ended February 25, 2023.

Additionally, gross profit of $116.9 million, or 37.4% of net sales, for the thirteen weeks ended February 24, 2024, increased 280 basis points from 34.6% of net sales for the thirteen weeks ended February 25, 2023.

The increase in gross profit margin was primarily driven by lower ingredient and packaging costs.

Operating expenses .

Operating expenses increased $4.8 million, or 8.2%, for the thirteen weeks ended November 25, 2023 compared to the thirteen weeks ended November 26, 2022 due to the following:

Operating expenses increased $8.6 million, or 14.2%, for the thirteen weeks ended February 24, 2024, compared to the thirteen weeks ended February 25, 2023 due to the following:

• Selling and marketing.

Selling and marketing expenses increased $3.5 million, or 12.1%, for the thirteen weeks ended November 25, 2023 compared to the thirteen weeks ended November 26, 2022, due to expenses related to growth initiatives.

Selling and marketing expenses increased $4.7 million, or 15.7%, for the thirteen weeks ended February 24, 2024, compared to the thirteen weeks ended February 25, 2023, due to increased expenses related to growth initiatives and higher advertising costs.

• General and administrative.

General and administrative expenses increased $1.3 million, or 5.1%, for the thirteen weeks ended November 25, 2023 compared to the thirteen weeks ended November 26, 2022.

The increase in general and administrative expenses was primarily attributable to $0.7 million of stock based compensation expense, $0.4 million of executive transition costs, and other investments in organizational capabilities.

General and administrative expenses increased $4.0 million, or 15.4%, for the thirteen weeks ended February 24, 2024, compared to the thirteen weeks ended February 25, 2023.

The increase in general and administrative expenses was primarily attributable to an increase of $1.5 million in stock-based compensation, higher employee costs and corporate expenses.

• Depreciation and amortization.

Depreciation and amortization expenses was $4.4 million for the thirteen weeks ended November 25, 2023 and $4.3 million for the thirteen weeks ended November 26, 2022, respectively.

Depreciation and amortization expense was $4.2 million for the thirteen weeks ended February 24, 2024 and $4.3 million for the thirteen weeks ended February 25, 2023, respectively.

Interest income.

Interest income increased by $1.0 million for the thirteen weeks ended November 25, 2023 compared to the thirteen weeks ended November 26, 2022, due to higher cash balances, the increase in interest rates, and other sources of interest income.

Interest income increased by $0.7 million for the thirteen weeks ended February 24, 2024, compared to the thirteen weeks ended February 25, 2023, due to higher cash balances than prior year period and the increase in interest rates.

Interest expense .

Interest expense decreased $1.0 million for the thirteen weeks ended November 25, 2023 compared to the thirteen weeks ended November 26, 2022, primarily due to the effect of principal payments reducing the outstanding balance of the Term Facility (as defined below) to $275.0 million as of November 25, 2023, from $400.0 million as of November 26, 2022.

The reduction in the outstanding balance of the Term Facility was partially offset by the increase in interest rates on our Term Facility to 8.0% as of November 25, 2023 from 7.7% as of November 26, 2022.

Additionally, interest expense related to the amortization of deferred financing costs and debt discount decreased $0.1 million for the thirteen weeks ended November 25, 2023 compared to the thirteen weeks ended November 26, 2022.

Gain on foreign currency transactions.

Foreign currency transactions resulted in a gain of $0.2 million and a gain of $0.1 million for the thirteen weeks ended November 25, 2023 and November 26, 2022, respectively.

Interest expense decreased $2.9 million for the thirteen weeks ended February 24, 2024, compared to the thirteen weeks ended February 25, 2023, primarily due to the effect of principal payments reducing the outstanding balance of the Term Facility (as defined below) to $240.0 million as of February 24, 2024, from $365.0 million as of February 25, 2023.

Additionally, interest expense related to the amortization of deferred financing costs and debt discount decreased $0.1 million for the thirteen weeks ended February 24, 2024, compared to the thirteen weeks ended February 25, 2023.

(Loss) on foreign currency transactions.

Foreign currency transactions resulted in an immaterial loss and a loss of $0.2 million for the thirteen weeks ended February 24, 2024, and February 25, 2023, respectively.

The variance is attributable to changes in foreign currency rates related to our international operations.

Income tax expense.

Income tax expense increased $1.9 million for the thirteen weeks ended November 25, 2023 compared to the thirteen weeks ended November 26, 2022.

Income tax expense increased $1.9 million for the thirteen weeks ended February 24, 2024, compared to the thirteen weeks ended February 25, 2023.

The increase in our income tax expense was primarily driven by higher income from operations and changes in permanent differences.

Net income was $35.6 million for the thirteen weeks ended November 25, 2023, a decrease of $0.3 million compared to net income of $35.9 million for the thirteen weeks ended November 26, 2022.

Net income benefited by higher gross profit, higher interest income, and lower interest expense, partially offset by growth in marketing expenses, higher stock based compensation expenses, executive transition costs, and higher income tax expense.

Net income was $33.1 million for the thirteen weeks ended February 24, 2024, an increase of $7.5 million compared to net income of $25.6 million for the thirteen weeks ended February 25, 2023.

Net income was benefited by higher gross profit, higher interest income, and lower interest expense, partially offset by growth in marketing expenses, higher stock-based compensation expenses, and higher income tax expense.

Adjusted EBITDA.

Adjusted EBITDA increased $1.2 million, or 2.0% for the thirteen weeks ended November 25, 2023 compared to the thirteen weeks ended November 26, 2022, driven primarily by higher gross profit, partially offset by growth in marketing expenses.

Adjusted EBITDA increased $6.9 million, or 13.6%, for the thirteen weeks ended February 24, 2024, compared to the thirteen weeks ended February 25, 2023, driven primarily by higher gross profit, partially offset by growth in marketing expenses.

For a reconciliation of Adjusted EBITDA to its most directly comparable GAAP measure, see “Reconciliation of EBITDA and Adjusted EBITDA” below.

Comparison of Unaudited Results for the Twenty-Six Weeks Ended February 24, 2024, and the Twenty-Six Weeks Ended February 25, 2023

Twenty-Six Weeks Ended Twenty-Six Weeks Ended

(In thousands) February 24, 2024 % of Net Sales February 25, 2023 % of Net Sales

Net sales $ 620,877 100.0 % $ 597,462 100.0 %

Cost of goods sold 388,889 62.6 % 383,738 64.2 %

Gross profit 231,988 37.4 % 213,724 35.8 %

Operating expenses:

Selling and marketing 66,633 10.7 % 58,482 9.8 %

General and administrative 56,883 9.2 % 51,575 8.6 %

Depreciation and amortization 8,569 1.4 % 8,672 1.5 %

Total operating expenses 132,085 21.3 % 118,729 19.9 %

Income from operations 99,903 16.1 % 94,995 15.9 %

Other income (expense):

Interest income 2,014 0.3 % 253 — %

Interest expense (11,630) (1.9) % (15,552) (2.6) %

Gain (loss) on foreign currency transactions 203 — % (106) — %

Other income 6 — % 6 — %

Total other expense (9,407) (1.5) % (15,399) (2.6) %

Income before income taxes 90,496 14.6 % 79,596 13.3 %

Income tax expense 21,812 3.5 % 18,094 3.0 %

Net income $ 68,684 11.1 % $ 61,502 10.3 %

Other financial data:

Adjusted EBITDA (1)

$ 119,805 19.3 % $ 111,666 18.7 %

(1) Adjusted EBITDA is a non-GAAP financial metric.

See “Reconciliation of EBITDA and Adjusted EBITDA” below for a reconciliation of net income to EBITDA and Adjusted EBITDA for each applicable period.

Net sales of $620.9 million represented an increase of $23.4 million, or 3.9%, for the twenty-six weeks ended February 24, 2024, compared to the twenty-six weeks ended February 25, 2023.

The increase in sales was primarily driven by Quest volume growth which offset Atkins softness.

North America and International net sales increased 3.9% and 6.5%, respectively, versus last year.

Cost of goods sold .

Cost of goods sold increased $5.2 million, or 1.3%, for the twenty-six weeks ended February 24, 2024, compared to the twenty-six weeks ended February 25, 2023.

The cost of goods sold increase was primarily driven by higher sales volumes in the twenty-six weeks ended February 24, 2024.

Gross profit.

Gross profit increased $18.3 million, or 8.5%, for the twenty-six weeks ended February 24, 2024, compared to the twenty-six weeks ended February 25, 2023.

Additionally, gross profit of $232.0 million, or 37.4% of net sales, for the twenty-six weeks ended February 24, 2024 increased 160 basis points from 35.8% of net sales for the twenty-six weeks ended February 25, 2023, due primarily to lower ingredient and packaging costs.

Operating expenses .

Operating expenses increased $13.4 million, or 11.2%, for the twenty-six weeks ended February 24, 2024, compared to the twenty-six weeks ended February 25, 2023, due to the following:

• Selling and marketing.

Selling and marketing expenses increased $8.2 million, or 13.9%, for the twenty-six weeks ended February 24, 2024, compared to the twenty-six weeks ended February 25, 2023, primarily due to increased expenses related to

growth initiatives and higher advertising costs.

• General and administrative.

General and administrative expenses increased $5.3 million, or 10.3%, for the twenty-six weeks ended February 24, 2024, compared to the twenty-six weeks ended February 25, 2023.

The increase in general and administrative expense was primarily attributable to a $2.2 million increase in stock-based compensation, $0.1 million increase in executive officer transition costs, and higher employee costs and corporate expenses in the twenty-six weeks ended February 24, 2024.

• Depreciation and amortization.

Depreciation and amortization expenses were $8.6 million and $8.7 million for the twenty-six weeks ended February 24, 2024, compared to the twenty-six weeks ended February 25, 2023, respectively.

Interest income.

Interest income increased by $1.8 million for the twenty-six weeks ended February 24, 2024, compared to the twenty-six weeks ended February 25, 2023, due to higher cash balances, the increase in interest rates, and other sources of interest income.

Interest expense .

Interest expense decreased $3.9 million for the twenty-six weeks ended February 24, 2024, compared to the twenty-six weeks ended February 25, 2023, primarily due to the effect of principal payments reducing the outstanding balance of the Term Facility (as defined below) to $240.0 million as of February 24, 2024, from $365.0 million as of February 25, 2023.

Additionally, interest expense related to the amortization of deferred financing costs and debt discount decreased $0.2 million for the twenty-six weeks ended February 24, 2024, compared to the twenty-six weeks ended February 25, 2023.

Gain (loss) on foreign currency transactions.

Foreign currency transactions resulted in a gain of $0.2 million and a loss of $0.1 million for the twenty-six weeks ended February 24, 2024, and February 25, 2023, respectively.

The variance is attributable to changes in foreign currency rates related to our international operations.

Income tax expense.

Income tax expense increased $3.7 million for the twenty-six weeks ended February 24, 2024, compared to the twenty-six weeks ended February 25, 2023.

The increase in our income tax expense was primarily driven by higher income from operations and changes in permanent differences.

Net income was $68.7 million for the twenty-six weeks ended February 24, 2024, an increase of $7.2 million compared to net income of $61.5 million for the twenty-six weeks ended February 25, 2023.

Net income was benefited by higher gross profit, higher interest income, and lower interest expense, and was partially offset by growth in marketing expenses, higher stock-based compensation expenses, and higher income tax expense.

Adjusted EBITDA.

Adjusted EBITDA increased $8.1 million, or 7.3% for the twenty-six weeks ended February 24, 2024, compared to the twenty-six weeks ended February 25, 2023, driven primarily by higher net gross profit, partially offset by investments in growth initiatives and higher advertising costs.

For a reconciliation of Adjusted EBITDA to its most directly comparable GAAP measure, see “Reconciliation of EBITDA and Adjusted EBITDA” below.

Reconciliation of EBITDA and Adjusted EBITDA

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EBITDA and Adjusted EBITDA may not be comparable to other similarly titled captions of other companies due to differences in the non-GAAP calculation.

The following unaudited table provides a reconciliation of EBITDA and Adjusted EBITDA to its most directly comparable GAAP measure, which is net income, for the thirteen weeks ended November 25, 2023 and November 26, 2022:

(In thousands) Thirteen Weeks Ended

November 25, 2023 November 26, 2022

The following unaudited table provides a reconciliation of EBITDA and Adjusted EBITDA to its most directly comparable GAAP measure, which is net income, for the thirteen and twenty-six weeks ended February 24, 2024, and February 25, 2023:

(In thousands) Thirteen Weeks Ended Twenty-Six Weeks Ended

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

Net income $ 33,123 $ 25,642 $ 68,684 $ 61,502

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Executive transition costs — 421 366 421

25 217 (201) 114

Adjusted EBITDA $ 57,840 $ 50,900 $ 119,805 $ 111,666

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Our principal uses of cash have been working capital, debt service, repurchases of our common stock, and acquisition opportunities.

We had $121.4 million in cash as of November 25, 2023.

We had $135.9 million in cash as of February 24, 2024.

We believe our sources of liquidity and capital will be sufficient to finance our continued operations, growth strategy and additional expenses we expect to incur for at least the next twelve months.

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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.

At November 25, 2023, the outstanding balance of the Term Facility was $275.0 million.

We are not required to make principal payments on the Term Facility over the twelve months following the period ended November 25, 2023.

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

At February 24, 2024, the outstanding balance of the Term Facility was $240.0 million.

We are not 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, there were no amounts drawn against the Revolving Credit Facility.

As of February 24, 2024, there were no amounts drawn against the Revolving Credit Facility.

Stock Repurchase Program

On October 21, 2022, we announced that our Board of Directors had approved the addition of $50.0 million to our stock repurchase program, resulting in authorized stock repurchases of up to an aggregate of $150.0 million.

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 for repurchases under our $150.0 million stock repurchase program.

On October 21, 2022, we announced that our Board of Directors approved the addition of $50.0 million to our stock repurchase program, resulting in authorized stock repurchases of up to an aggregate of $150.0 million.

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 for repurchases under our $150.0 million stock repurchase program.

Refer to Note 10, Stockholders’ Equity, of the Notes to Unaudited Consolidated Financial Statements in this Report for additional information related to our stock repurchase program.

The following table sets forth the major sources and uses of cash for each of the periods set forth below (in thousands):

Thirteen Weeks Ended

November 25, 2023 November 26, 2022

Twenty-Six Weeks Ended

February 24, 2024 February 25, 2023

Net cash provided by operating activities

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Operating activities.

Our net cash provided by operating activities increased $38.8 million to $47.5 million for the thirteen weeks ended November 25, 2023 compared to $8.7 million for the thirteen weeks ended November 26, 2022.

The increase in cash provided by operating activities was primarily attributable changes in working capital for the thirteen weeks ended November 25, 2023 as compared to the thirteen weeks ended November 26, 2022.

Changes in working capital, comprised of changes in accounts receivable, net, inventories, prepaid expenses, accounts payable, and accrued expenses and other current liabilities, which are driven by the timing of payments and receipts and seasonal building of inventory, consumed cash of $7.7 million in the thirteen weeks ended November 25, 2023 compared to $47.6 million of cash consumed in the thirteen weeks ended November 26, 2022.

These increases in cash provided by operating activities were partially offset by the $0.7 million decrease in income from operations to $51.8 million for the thirteen weeks ended November 25, 2023 as compared to $52.5 million for the thirteen weeks ended November 26, 2022.

Additionally, cash paid for interest was $2.1 million

in the thirteen weeks ended November 25, 2023, which was a decrease of $4.3 million as compared to the $6.4 million paid for interest in the thirteen weeks ended November 26, 2022.

In addition, cash paid for taxes increased $0.6 million.

Our net cash provided by operating activities increased $40.6 million to $94.0 million for the twenty-six weeks ended February 24, 2024, compared to $53.3 million for the twenty-six weeks ended February 25, 2023.

The increase in cash provided by operating activities was primarily attributable to changes in working capital for the twenty-six weeks ended February 24, 2024, as compared to the twenty-six weeks ended February 25, 2023.

Changes in working capital, comprised of changes in accounts receivable, net, inventories, prepaid expenses, accounts payable, and accrued expenses and other current liabilities, which are driven by the timing of payments and receipts and seasonal building of inventory, consumed cash of $5.5 million in the twenty-six weeks ended February 24, 2024 compared to $36.2 million of cash consumed in the twenty-six weeks ended February 25, 2023, an improvement of $30.7 million.

In addition, income from operations increased by $4.9 million to $99.9 million for the twenty-six weeks ended February 24, 2024, as compared to $95.0 million for the twenty-six weeks ended February 25, 2023.

Additionally, cash paid for interest was $11.2

million in the twenty-six weeks ended February 24, 2024, which was a decrease of $3.1 million as compared to the $14.3 million paid for interest in the twenty-six weeks ended February 25, 2023.

In addition, cash paid for taxes decreased $0.9 million.

Investing activities .

Our net cash used in investing activities was $0.8 million for the thirteen weeks ended November 25, 2023 compared to $1.2 million for the thirteen weeks ended November 26, 2022.

Our net cash used in investing activities for the thirteen weeks ended November 25, 2023 primarily comprised $0.7 million of purchases of property and equipment.

The $1.2 million of net cash used in investing activities for the thirteen weeks ended November 26, 2022 primarily comprised $1.2 million of purchases of property and equipment.

Our net cash used in investing activities was $1.3 million for the twenty-six weeks ended February 24, 2024 compared to $1.9 million for the twenty-six weeks ended February 25, 2023.

Our net cash used in investing activities for the twenty-six weeks ended February 24, 2024, primarily comprised $1.1 million of purchases of property and equipment.

The $1.9 million of net cash used in investing activities for the twenty-six weeks ended February 25, 2023, primarily comprised $1.7 million of purchases of property and equipment.

Financing activities .

Our net cash used in financing activities was $13.1 million for the thirteen weeks ended November 25, 2023 compared to $20.8 million for the thirteen weeks ended November 26, 2022.

Net cash used in financing activities for the thirteen weeks ended November 25, 2023 primarily consisted of $10.0 million in principal payments on the Term Facility, and $3.6 million in tax payments related to issuance of restricted stock units and performance stock units, partially offset by $0.6 million of cash proceeds received from the partial repayment of an outstanding note receivable.

Net cash used in financing activities for the thirteen weeks ended November 26, 2022 primarily consisted of $16.4 million in repurchases of common stock, $6.5 million in principal payments on the Term Facility, and $2.3 million in tax payments related to issuance of restricted stock units and performance stock units, partially offset by $4.6 million of cash proceeds received from option exercises.

Our net cash used in financing activities was $44.7 million for the twenty-six weeks ended February 24, 2024, compared to $55.7 million for the twenty-six weeks ended February 25, 2023.

Net cash used in financing activities for the twenty-six weeks ended February 24, 2024, primarily consisted of $45.0 million in principal payments on the Term Facility, and $3.8 million in tax payments related to issuance of restricted stock units and performance stock units, partially offset by $3.0 million of cash proceeds received from option exercises, and $1.2 million of cash proceeds received from the partial repayment of an outstanding note receivable.

Net cash used in financing activities for the twenty-six weeks ended February 25, 2023, primarily consisted of $16.4 million in repurchases of common stock, $41.5 million in principal payments on the Term Facility, and $2.4 million in tax payments related to issuance of restricted stock units and performance stock units, partially offset by $4.8 million of cash proceeds received from option exercises.

New Accounting Pronouncements

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Quantitative and Qualitative Disclosures about Market Risk

There were no material changes in our market risk exposure during the thirteen week period ended November 25, 2023.

There were no material changes in our market risk exposure during the thirteen-week period ended February 24, 2024.

For a discussion of our market risks, see “Quantitative and Qualitative Disclosures About Market Risk” in Part II, Item 7A of our Annual Report.

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 2. Management’s Discussion and Analysis