What changed in this filing

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Item 1. Financial Statements

2025-04-09 compared with 2025-01-08 · 108 added, 94 removed, 470 unchanged (30% of the section changed)

3 unchanged sentences

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

November 30, 2024 August 31, 2024

March 1, 2025 August 31, 2024

Current assets:

37 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, 103,393,159 and 101,929,868 shares issued at November 30, 2024 and August 31, 2024, respectively 1,034 1,025

Treasury stock, 2,365,100 shares and 2,365,100 shares at cost at November 30, 2024 and August 31, 2024, respectively ( 78,451 ) ( 78,451 )

Common stock, $0.01 par value, 600,000,000 shares authorized, 103,415,302 and 102,515,315 shares issued at March 1, 2025, and August 31, 2024, respectively 1,034 1,025

Treasury stock, 2,365,100 shares and 2,365,100 shares at cost at March 1, 2025, and August 31, 2024, 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 30, 2024 November 25, 2023

Thirteen Weeks Ended Twenty-Six Weeks Ended

March 1, 2025 February 24, 2024 March 1, 2025 February 24, 2024

Net sales $ 359,655 $ 312,199 $ 700,923 $ 620,877

11 unchanged sentences

Interest expense ( 6,338 ) ( 5,596 ) ( 14,199 ) ( 11,630 )

Gain on foreign currency transactions 120 226

(Loss) gain on foreign currency transactions ( 125 ) ( 23 ) ( 5 ) 203

Other income 19 — 34 6

16 unchanged sentences

(Unaudited, dollars in thousands)

Thirteen Weeks Ended

November 30, 2024 November 25, 2023

Twenty-Six Weeks Ended

March 1, 2025 February 24, 2024

Operating activities

4 unchanged sentences

Stock compensation expense 8,792 8,736

Estimated credit losses 750 51

Unrealized gain on foreign currency transactions ( 120 ) ( 226 )

Estimated credit losses (gains) 101 ( 140 )

Unrealized gain (loss) on foreign currency transactions 5 ( 203 )

Deferred income taxes 6,440 7,722

14 unchanged sentences

Purchases of property and equipment ( 802 ) ( 1,087 )

Acquisition of business, net of cash acquired 1,713 —

Investments in intangible and other assets ( 911 ) ( 191 )

Net cash used in investing activities

( 669 ) ( 800 )

Financing activities

12 unchanged sentences

$ 103,682 $ 135,876

Thirteen Weeks Ended

November 30, 2024 November 25, 2023

Twenty-Six Weeks Ended

March 1, 2025 February 24, 2024

Supplemental disclosures of cash flow information

2 unchanged sentences

Cash paid for taxes

$ 19,122 $ 14,884

Non-cash investing and financing transactions

15 unchanged sentences

Balance at November 30, 2024 103,393,159 $ 1,034 2,365,100 $ ( 78,451 ) $ 1,331,000 $ 525,387 $ ( 2,426 ) $ 1,776,544

Net income — — — — — 36,747 — 36,747

Stock-based compensation — — — — 4,947 — — 4,947

Foreign currency translation adjustments — — — — — — ( 426 ) ( 426 )

Shares issued upon vesting of restricted stock units 18,229 — — — ( 207 ) — — ( 207 )

Exercise of options to purchase common stock 3,914 — — — 152 — — 152

Balance at March 1, 2025 103,415,302 $ 1,034 2,365,100 $ ( 78,451 ) $ 1,335,892 $ 562,134 $ ( 2,852 ) $ 1,817,757

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

6 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 )

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

See accompanying notes to the unaudited consolidated financial statements.

34 unchanged sentences

Recently Issued Accounting Pronouncements Not Yet Adopted

In March 2020, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”), which provides optional guidance for a limited period of time to ease the potential burden in accounting for reference rate reform on financial reporting.

Additionally, in December 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848), Deferral of the Sunset Date of Topic 848, which extended the period of time for which ASU 2020-04 could be applied.

As a result, the amendments in ASU 2020-04 can be applied to contract modifications due to rate reform and eligible existing and new hedging relationships entered into between March 12, 2020, and December 31, 2024.

The amendments of these ASUs are effective for all entities and are applied on a prospective basis.

On January 21, 2022, the Company entered into a repricing amendment (the “2022 Repricing Amendment”) to its credit agreement with Barclays Bank PLC and other parties (as amended to date, the “Credit Agreement”), as described in Note 6, Long-Term Debt and Line of Credit.

In addition to replacing the London Interbank Offered Rate (“LIBOR”) as the Credit Agreement’s reference rate with the Secured Overnight Financing Rate (“SOFR”), the 2022 Repricing Amendment contemporaneously modified other terms that changed, or had the potential to change, the amount or timing of contractual cash flows as contemplated by the guidance in ASU 2020-04.

As such, the contract modifications related to the 2022 Repricing Amendment were outside of the scope of the optional guidance in ASU 2020-04.

The Company will continue to monitor the effects of rate reform, if any, on any new or amended contracts through December 31, 2024.

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

In November 2023, the FASB issued ASU No.

13 unchanged sentences

In November 2024, the FASB issued ASU No.

2024-03, Comprehensive Income - Expense Disaggregation Disclosures (“ASU 2024-03”), which will improve the disclosures about a public business entity’s expenses and address requests from investors for more detailed information about the types of expenses in commonly presented expense captions such as cost of sales, SG&A, and R&D.

The amendments are effective for fiscal years beginning after December 15, 2026.

2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses (“ASU 2024-03”), which will improve the disclosures about a public business entity’s expenses and address requests from investors for more detailed information about the types of expenses in commonly presented expense captions such as cost of sales, SG&A, and R&D.

The amendments are effective for fiscal years beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027.

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

4 unchanged sentences

On April 29, 2024 , the Company’s wholly owned subsidiary, Simply Good Foods, USA, Inc.

entered into a stock purchase agreement (the “Purchase Agreement”) to acquire Only What You Need, Inc.

(“OWYN”), a plant-based protein food company (the “OWYN Acquisition”), for approximately $ 280.0 million.

entered into a Purchase Agreement to acquire OWYN, a plant-based protein food company, for approximately $ 280.0 million.

On June 13, 2024, pursuant to the Purchase Agreement, the Company completed the OWYN Acquisition by acquiring 100% of the equity interests for a cash purchase price at closing of $ 281.9 million, subject to certain customary post-closing adjustments.

1 unchanged sentence

The OWYN Acquisition was funded through a combination of incremental borrowings under our outstanding Term Facility, as defined below, totaling $ 250.0 million and cash on hand.

Business transaction costs within the Consolidated Statements of Operations and Comprehensive Income for the thirteen week period ended November 30, 2024, were $ 0.6 million, which consisted of legal, accounting, and other costs.

During the thirteen weeks ended March 1, 2025, the Company received a post-closing release from escrow of approximately $ 1.7 million related to net working capital adjustments, resulting in a total net consideration paid of $ 280.2 million as of March 1, 2025.

Business transaction costs within the Consolidated Statements of Operations and Comprehensive Income for the twenty-six weeks ended March 1, 2025, were $ 0.8 million, which consisted of legal, accounting, and other costs.

The OWYN Acquisition was accounted for as a business combination under ASC 805, Business Combinations (“ASC 805”), which requires, among other things, assets acquired and liabilities assumed to be measured at their acquisition date fair value.

35 unchanged sentences

Measurement period adjustments are recognized in the reporting period in which the adjustments are determined and calculated as if the accounting had been completed at the acquisition date.

During the thirteen weeks ended March 1, 2025, a measurement period adjustment of $ 1.7 million was recorded to goodwill.

The final fair value determination of the assets acquired and liabilities assumed will be completed prior to one year from the transaction completion, consistent with ASC 805.

2 unchanged sentences

The following table provides net sales from the acquired OWYN business included in the Company’s results:

Thirteen Weeks Ended

(In thousands) November 30, 2024

Thirteen Weeks Ended Twenty-Six Weeks Ended

(In thousands) March 1, 2025 March 1, 2025

Net sales $ 33,806 $ 66,060

6 unchanged sentences

The following unaudited pro forma combined financial information presents combined results of the Company assuming the OWYN Acquisition occurred at the beginning of fiscal year 2024:

Thirteen Weeks Ended

(In thousands) November 25, 2023

Thirteen Weeks Ended Twenty-Six Weeks Ended

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

Net sales $ 338,851 $ 669,508

3 unchanged sentences

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

Thirteen Weeks Ended

(In thousands) November 30, 2024 November 25, 2023

Thirteen Weeks Ended Twenty-Six Weeks Ended

(In thousands) March 1, 2025 February 24, 2024 March 1, 2025 February 24, 2024

North America (1)

6 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 losses on accounts receivable from transactions with external customers were $ 0.8 million for the thirteen weeks ended November 30, 2024, and $ 0.1 million for the thirteen weeks ended November 25, 2023.

As of November 30, 2024, and August 31, 2024, the allowance for credit losses related to accounts receivable was $ 1.4 million and $ 0.7 million, respectively.

Charges related to credit losses on accounts receivable from transactions with external customers were $( 0.6 ) million and $ 0.1 million for the thirteen and twenty-six weeks ended March 1, 2025, respectively.

Charges related to credit losses 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.

As of March 1, 2025, and August 31, 2024, the allowance for credit losses related to accounts receivable were $ 1.2 million and $ 0.7 million, respectively.

Goodwill and Intangibles

As of November 30, 2024, and August 31, 2024, Goodwill in the Consolidated Balance Sheets was $591.7 million.

There were no impairment charges related to goodwill during the thirteen weeks ended November 30, 2024, or since the inception of the Company.

Changes to Goodwill during the twenty-six weeks ended March 1, 2025, were as follows:

(In thousands) Goodwill

Balance as of August 31, 2024 $ 591,687

Acquisition of business ( 1,713 )

Balance as of March 1, 2025 $ 589,974

The change in the Company's Goodwill from August 31, 2024, to March 1, 2025, is the result of the acquisition method of accounting related to the OWYN Acquisition, as described in Note 3.

There were no impairment charges related to goodwill during the thirteen and twenty-six weeks ended March 1, 2025, or since the inception of the Company.

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

November 30, 2024

March 1, 2025

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

19 unchanged sentences

$ 1,425,973 $ 89,507 $ 1,336,466

Changes in Intangible assets, net during the thirteen weeks ended November 30, 2024, were primarily related to recurring amortization expense.

Amortization expense related to intangible assets was $ 3.7 million for the thirteen weeks ended November 30, 2024, and $ 3.9 million for the thirteen weeks ended November 25, 2023.

There were no impairment charges related to its finite-lived intangible assets during the thirteen weeks ended November 30, 2024, and November 25, 2023.

Changes in Intangible assets, net during the twenty-six weeks ended March 1, 2025, were primarily related to recurring amortization expense.

Amortization expense related to intangible assets was $ 3.7 million and $ 3.8 million for the thirteen weeks ended March 1, 2025, and February 24, 2024, respectively, and $ 7.5 million and $ 7.7 million for the twenty-six weeks ended March 1, 2025, and February 24, 2024, respectively.

There were no impairment charges related to its finite-lived intangible assets during the thirteen and twenty-six weeks ended March 1, 2025, and February 24, 2024.

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

23 unchanged sentences

No amounts under the Term Facility were repaid as a result of the execution of the 2024 Incremental Facility Amendment.

Effective as of the 2024 Incremental Facility Amendment, the interest rate per annum for the Initial Term Loans is based on either:

On January 31, 2025, the Company entered into a seventh amendment (the “2025 Repricing Amendment”) to the Credit Agreement to reduce the interest rate per annum applicable to the Initial Term Loans outstanding under the Credit Agreement immediately prior to the effective date of the 2025 Repricing Amendment.

Effective as of the 2025 Repricing Amendment, the interest rate per annum for the Initial Term Loans is based on either:

A base rate equaling the higher of (a) the “prime rate,” (b) the federal funds effective rate plus 0.50 %, or (c) the Adjusted Term SOFR Rate (as defined in the Credit Agreement) applicable for an interest period of one month plus 1.00 % plus (x) 1.00 % margin for the Term Loan or (y) 2.00 % margin for the Revolving Credit Facility;

SOFR plus a credit spread adjustment equal to 0.10 % for one-month SOFR, 0.15 % for up to three-month SOFR and 0.25 % for up to six-month SOFR, subject to a floor of 0.50 %, plus (x) 2.50 % margin for the Term Loan or (y) 3.00 % margin for the Revolving Credit Facility.

In connection with the closing of the 2024 Incremental Facility Amendment, the Company expensed $ 3.4 million of non-deferrable third-party costs through Business transaction costs and capitalized $ 1.2 million of third-party financing costs.

SOFR, subject to a floor of 0.50 %, plus (x) 2.00 % margin for the Term Loan or (y) 3.00 % margin for the Revolving Credit Facility.

In connection with the closing of the 2025 Repricing Amendment, the Company expensed $ 0.7 million of non-deferrable third-party costs through General and administrative .

The Simply Good Foods Company is not a borrower under the Credit Agreement and has not provided a guarantee of the Credit Agreement.

7 unchanged sentences

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 30, 2024 and August 31, 2024, respectively.

The Company was in compliance with all covenants as of March 1, 2025, and August 31, 2024, respectively.

Long-term debt consists of the following:

(In thousands) November 30, 2024 August 31, 2024

Term Facility (effective rate of 7.2% at November 30, 2024)

(In thousands) March 1, 2025 August 31, 2024

Term Facility (effective rate of 6.3% at March 1, 2025)

$ 300,000 $ 400,000

1 unchanged sentence

Long-term debt, net of deferred financing fees $ 298,537 $ 397,485

The Company is no t required to make principal payments on the Term Facility over the twelve months following the period ended November 30, 2024.

The Company is no t required to make principal payments on the Term Facility over the twelve months following the period ended March 1, 2025.

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

As of November 30, 2024, the Company had letters of credit in the amount of $ 2.1 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 as of November 30, 2024.

As of March 1, 2025, the Company had letters of credit in the amount of $ 0.9 million outstanding.

These letters of credit offset against the $ 75.0 million availability of the Revolving Credit Facility and exist to support two of the Company’s leased buildings.

No amounts were drawn against these letters of credit as of March 1, 2025.

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 30, 2024, and August 31, 2024, the book value of the Company’s debt approximated fair value.

As of March 1, 2025, and August 31, 2024, 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 approximate fair value as of November 30, 2024.

Components of the balance sheet such as accounts receivable, cash and cash equivalents, and others approximate fair value as of March 1, 2025.

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

Thirteen Weeks Ended

(In thousands) November 30, 2024 November 25, 2023

Twenty-Six Weeks Ended

(In thousands) March 1, 2025 February 24, 2024

Income before income taxes $ 96,653 $ 90,496

1 unchanged sentence

Effective tax rate 22.5 % 24.1 %

The effective tax rate for the thirteen weeks ended November 30, 2024, was 4.5 % lower than the effective tax rate for the thirteen weeks ended November 25, 2023, which was primarily driven by permanent differences, principally stock-based compensation.

The effective tax rate for the twenty-six weeks ended March 1, 2025, was 1.6 % lower than the effective tax rate for the twenty-six weeks ended February 24, 2024, which was primarily driven by permanent differences, principally stock-based compensation.

The components of lease expense were as follows:

Thirteen Weeks Ended

(In thousands) Statements of Operations Caption November 30, 2024 November 25, 2023

Thirteen Weeks Ended Twenty-Six Weeks Ended

(In thousands) Statements of Operations Caption March 1, 2025 February 24, 2024 March 1, 2025 February 24, 2024

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 30, 2024 August 31, 2024

(In thousands) Balance Sheets Caption March 1, 2025 August 31, 2024

Operating lease right-of-use assets Other long-term assets $ 31,728 $ 35,097

3 unchanged sentences

Total lease liabilities $ 36,309 $ 39,824

Future maturities of lease liabilities as of November 30, 2024, were as follows:

Future maturities of lease liabilities as of March 1, 2025, were as follows:

(In thousands) Operating Leases

6 unchanged sentences

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

November 30, 2024 August 31, 2024

March 1, 2025 August 31, 2024

Weighted-average remaining lease term (in years)

3 unchanged sentences

Supplemental and other information related to leases was as follows:

Thirteen Weeks Ended

(In thousands) November 30, 2024 November 25, 2023

Twenty-Six Weeks Ended

(In thousands) March 1, 2025 February 24, 2024

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 contracts in place and achievement of performance conditions as of November 30, 2024, the Company will be required to make payments of $ 1.9 million over the next year.

Based on the terms of contracts in place and achievement of performance conditions as of March 1, 2025, the Company will be required to make payments of $ 1.8 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 30, 2024, or the thirteen weeks ended November 25, 2023.

As of November 30, 2024, 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 March 1, 2025, or the twenty-six weeks ended February 24, 2024.

As of March 1, 2025, 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 30, 2024 November 25, 2023

Thirteen Weeks Ended Twenty-Six Weeks Ended

(In thousands, except per share data) March 1, 2025 February 24, 2024 March 1, 2025 February 24, 2024

Basic earnings per share computation:

10 unchanged sentences

Diluted earnings per share from net income $ 0.36 $ 0.33 $ 0.74 $ 0.68

Diluted earnings per share calculations for the thirteen weeks ended November 30, 2024, and November 25, 2023, excluded 0.7 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 weeks ended November 30, 2024, and November 25, 2023, both 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 week periods ended March 1, 2025, excluded 0.4 million and 0.7 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 week periods 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 week periods ended March 1, 2025, 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 week periods ended February 24, 2024, excluded an immaterial number 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 recipient’s other compensation is reported.

The Company recorded stock-based compensation expense of $ 3.8 million and $ 4.2 million in the thirteen weeks ended November 30, 2024, and November 25, 2023, respectively.

The Company recorded stock-based compensation expense of $ 4.9 million and $ 4.6 million in the thirteen weeks ended March 1, 2025, and February 24, 2024, respectively, and $ 8.8 million and $ 8.7 million in the twenty-six weeks ended March 1, 2025, and February 24, 2024, respectively.

Stock Options

The following table summarizes stock option activity for the thirteen weeks ended November 30, 2024:

The following table summarizes stock option activity for the twenty-six weeks ended March 1, 2025:

Shares underlying options Weighted average

3 unchanged sentences

Forfeited ( 19,694 ) 40.07

Outstanding as of November 30, 2024 1,681,630 $ 23.44 4.89

Vested and expected to vest as of November 30, 2024 1,681,630 $ 23.44 4.89

Exercisable as of November 30, 2024 1,485,031 $ 21.65 4.43

As of November 30, 2024, the Company had $ 1.8 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 thirteen weeks ended November 30, 2024, the Company received $ 10.0 million in cash from stock option exercises.

During the thirteen weeks ended November 25, 2023, the Company did no t receive cash from stock option exercises.

Outstanding as of March 1, 2025 1,673,208 $ 23.36 4.66

Vested and expected to vest as of March 1, 2025 1,673,208 $ 23.36 4.66

Exercisable as of March 1, 2025 1,476,609 $ 21.55 4.21

As of March 1, 2025, the Company had $ 1.4 million of total unrecognized compensation cost related to stock options that will be recognized over a weighted average period of 1.1 years.

During the twenty-six weeks ended March 1, 2025, and February 24, 2024, the Company received $ 10.1 million and $ 3.0 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 30, 2024:

The following table summarizes restricted stock unit activity for the twenty-six weeks ended March 1, 2025:

Units Weighted average

4 unchanged sentences

Forfeited ( 15,865 ) 38.08

Non-vested as of November 30, 2024 610,481 $ 36.20

As of November 30, 2024, the Company had $ 18.9 million of total unrecognized compensation cost related to restricted stock units that will be recognized over a weighted average period of 2.1 years.

Non-vested as of March 1, 2025 612,836 $ 36.34

As of March 1, 2025, the Company had $ 16.7 million of total unrecognized compensation cost related to restricted stock units that will be recognized over a weighted average period of 1.9 years.

Performance Stock Units

During the thirteen weeks ended November 30, 2024, the Board of Directors granted performance stock units under the Company’s Incentive Plan.

During the twenty-six weeks ended March 1, 2025, the Board of Directors granted performance stock units under the Company’s 2017 Omnibus Incentive Plan.

The number of shares issuable as a result of grants of performance stock units is determined based on market-based criteria, performance-based criteria, or a combination of market-based criteria and performance-based criteria.

11 unchanged sentences

These units are valued using a Monte Carlo simulation.

The following table summarizes performance stock unit activity for the thirteen weeks ended November 30, 2024:

The following table summarizes performance stock unit activity for the twenty-six weeks ended March 1, 2025:

Units Weighted average

4 unchanged sentences

Forfeited ( 41,604 ) 60.84

Non-vested as of November 30, 2024 281,403 $ 52.08

Non-vested as of March 1, 2025 280,101 $ 52.55

Performance stock units are generally granted to employees as a part of the annual grant in November of the associated fiscal year, although the Board of Directors reserves the right to administer mid-year grants from time to time as they see fit.

The fair value of each performance stock unit grant with a market-based TSR component is estimated on the date of grant using a Monte-Carlo simulation based on the following assumptions presented below which are associated with each year’s annual grant:

Thirteen Weeks Ended Thirteen Weeks Ended

November 30, 2024 November 25, 2023

Twenty-Six Weeks Ended Twenty-Six Weeks Ended

March 1, 2025 February 24, 2024

Expected volatility 31.38 % 33.96 %

3 unchanged sentences

Fair value $ 54.41 $ 57.43

As of November 30, 2024, the Company had $ 9.3 million of total unrecognized compensation cost related to performance stock units that will be recognized over an expected weighted average period of 2.2 years.

As of March 1, 2025, the Company had $ 7.8 million of total unrecognized compensation cost related to performance stock units that will be recognized over an expected weighted average period of 1.7 years.

Stock Appreciation Rights

Stock appreciation rights (“SARs”) permit the holder to participate in the appreciation of the Company’s common stock price and are awarded to non-employee consultants of the Company.

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 30, 2024, cliff vested two years from the date of grant and must be exercised within five years from the date of grant.

The following table summarizes SARs activity for the thirteen weeks ended November 30, 2024:

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

The SARs outstanding as of March 1, 2025, cliff vested two years from the date of grant and must be exercised within five years from the date of grant.

The following table summarizes SARs activity for the twenty-six weeks ended March 1, 2025:

Shares underlying SARs Weighted average

3 unchanged sentences

Forfeited — —

Outstanding as of November 30, 2024 150,000 $ 37.67

Vested and expected to vest as of November 30, 2024 150,000 $ 37.67

Exercisable as of November 30, 2024 150,000 $ 37.67

The SARs outstanding as of the thirteen weeks ended November 30, 2024, are liability-classified;

Outstanding as of March 1, 2025 150,000 $ 37.67

Vested as of March 1, 2025 150,000 $ 37.67

Exercisable as of March 1, 2025 150,000 $ 37.67

The SARs outstanding as of the twenty-six weeks ended March 1, 2025, 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