Central Garden & Pet

At the Barclays conference Central Garden & Pet announced a strategy to simplify its portfolio, increase margins and step up M&A activity. The company plans to use more than $1.1 billion in cash for add‑ons and is advancing the $340 million acquisition of TRIXIE, which is intended as a springboard for expansion in Europe. After exiting a low‑margin pet distribution business reported revenue fell, while organic growth, gross margin improvements and free cash flow of $300–350 million per year enhanced profitability. Central highlights e‑commerce, AI and product innovation as growth drivers and targets further organic growth plus targeted acquisitions with conservative leverage. » More on de.investing.com

Central Garden & Pet reported fiscal Q3 net sales down 8% to $882 million but raised full-year non-GAAP diluted EPS guidance to $2.85 or better after gross margin expanded 130 basis points and non-GAAP operating margin rose to 15.4%. Organic net sales rose 2% when excluding a divested pet distribution business, with the Garden segment driving growth and margin improvement. GAAP diluted EPS fell to $1.45 and non-GAAP EPS slipped to $1.54, while management agreed to acquire an 80% stake in TRIXIE for up to €400 million to expand in Europe, adding integration risk. The report leaves uncertainty: improved margins and guidance contrast with weaker reported Pet sales and lower net income, making future performance contingent on Garden momentum and successful TRIXIE integration. » More on finance.yahoo.com

Shares of Central Garden & Pet Company rose to a new 52-week high of $45.79. For the third fiscal quarter the company reported adjusted earnings per share of $1.54 (estimate $1.51) on revenue down 8% to $882 million, driven by the exit from a lower-margin distribution business. Organic net sales rose 2%, gross margin improved to 36%, and operating cash flow hit a record $327 million; cash reserves stand at $997 million. Central Garden & Pet raised its full-year EPS forecast to at least $2.85, and Canaccord raised its price target to $60 with a "Buy" rating. » More on de.investing.com