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    BGS
    Earnings call· Jun 2026(Q2 FY26)

    B&G Foods Q2 FY26 earnings call BGS

    Aug 11, 2026 Source

    Executive summary

    B&G Foods Q2 FY26 — Portfolio Reshaping and Reaffirmed Guidance Amidst CEO Transition

    B&G Foods reported Q2 FY26 results reflecting ongoing portfolio reshaping through strategic divestitures and acquisitions, alongside the appointment of a new CEO, Rob Mills, focused on execution and digital transformation. The company reaffirmed its full-year guidance, anticipating continued improvement in financial performance despite a challenging industry backdrop and volume declines in its base business.

    Highlights

    5

    • Adjusted EBITDA increased to $60.4 million (15.8% of net sales) in Q2 FY26 from $58 million (13.7%) in Q2 FY25, driven by strategic M&A and tariff refunds.

    • Adjusted net income grew to $4.9 million ($0.06 per share) in Q2 FY26 from $2.9 million ($0.04 per share) in Q2 FY25.

    • Adjusted gross profit as a percentage of net sales improved to 21.8% in Q2 FY26 from 21% in Q2 FY25, benefiting from higher-margin acquisitions and lower-margin divestitures.

    • SG&A expenses decreased by $6.6 million or 14% to $40.6 million, improving as a percentage of net sales by 0.5 percentage points to 10.6%.

    • Spices and Flavor Solutions segment adjusted EBITDA increased by $7 million or 29%, driven by pricing, improved cost environment, and tariff refunds.

    Concerns

    5

    • Net sales decreased by $41.1 million or 9.7% to $383.3 million in Q2 FY26, primarily due to divestitures.

    • Base business net sales decreased by $10.2 million or 2.9%, driven by a 4.3% volume decline.

    • Specialty segment adjusted EBITDA decreased by $8.9 million, impacted by divestitures, unfavorable raw material costs, and increased manufacturing expenses.

    • Net interest expense increased by $2.7 million or 7.5% to $38.5 million due to higher average long-term debt and the 11% interest rate on new notes.

    • The timing of the Fourth of July holiday negatively impacted Q2 FY26 net sales by approximately $5 million to $7 million.

    Guidance & targets

    12
    CategoryTargetConfidence
    Fiscal 2026 Net Sales
    $1.735 billion to $1.775 billion
    high materiality
    High
    Fiscal 2026 Adjusted EBITDA
    $275 million to $290 million
    high materiality
    High
    Fiscal 2026 Adjusted EBITDA as a percentage of net sales
    15.8% to 16.3%
    high materiality
    High
    Fiscal 2026 Adjusted Diluted Earnings Per Share
    $0.575 to $0.675 per share
    high materiality
    High
    Fiscal 2026 Interest Expense
    $157.5 million to $162.5 million
    medium materiality
    High
    Fiscal 2026 Cash Interest
    $150 million to $155 million
    medium materiality
    High
    Fiscal 2026 Depreciation Expense
    $40 million to $45 million
    medium materiality
    High
    Fiscal 2026 Amortization Expense
    $17 million to $19 million
    medium materiality
    High
    Fiscal 2026 Cash Taxes
    $5 million or less
    medium materiality
    High
    Fiscal 2026 Effective Tax Rate
    26% to 27%
    medium materiality
    High
    Fiscal 2026 Capital Expenditure
    Lower end of $30 million to $35 million
    medium materiality
    High
    Long-term Base Business Net Sales Growth
    0% to 2%
    high materiality
    High

    Segment performance

    5
    SegmentRevenueYoYQoQMargin
    Spices and Flavor Solutions
    Net sales increased slightly from $96.5 million in Q2 FY25. The increase in segment adjusted EBITDA was primarily due to pricing, improved cost environment for spices, and tariff refunds.
    Segment adjusted EBITDA increase: 29%Net pricing and product mix: increasedCost environment: improved relative to prior yearTariff refunds: received from U.S. government
    		$96.6 million0.1%—$7 million increase
    Meals
    Net sales increased from $104.1 million in Q2 FY25. The acquisition of Collagen and Kitchen Basics brands primarily drove the increase in net sales and segment adjusted EBITDA, offsetting declines in certain other brands.
    Acquisition of Collagen and Kitchen Basics brands: $13.2 million net sales
    		$110.5 million6.2%—$0.1 million increase
    Specialty
    Net sales decreased from $134.9 million in Q2 FY25. The decrease in segment adjusted EBITDA was due to the Don Pepino divestiture, unfavorable raw material costs, increased manufacturing expenses, and investment in Crisco oil pricing.
    Don Pepino divestiture: $1.8 million net sales in Q2 FY25Crisco oil pricing: investment, benefited from increased volumes
    		$128.9 million-4.4%—$8.9 million decrease
    Green Giant Canada
    Net sales increased from $22.9 million in Q2 FY25. This business is classified as an asset held for sale, with divestiture pending.
    		$23.4 million2.4%——
    Green Giant U.S. Frozen contract manufacturing business
    Generated this revenue in its first full quarter of operation following the sale of the Green Giant U.S. Frozen business. The team is looking to build this business, add new customers, and increase volumes.
    		$23.9 million——Modestly profitable

    Operational metrics

    12
    Adjusted EBITDA
    $60.4 millionvs $58 million Q2 FY25
    Q2 FY26

    Increased primarily due to the acquisition of Collagen and Kitchen Basics, divestiture of Green Giant U.S. Frozen, commencement of Green Giant U.S. Frozen contract manufacturing, and tariff refunds.

    Adjusted EBITDA as a percentage of net sales
    15.8%vs 13.7% Q2 FY25
    Q2 FY26

    Improved from the prior year period.

    Adjusted Net Income
    $4.9 millionvs $2.9 million Q2 FY25
    Q2 FY26

    Increased from the prior year period.

    Adjusted Diluted Earnings Per Share
    $0.06vs $0.04 Q2 FY25
    Q2 FY26

    Increased from the prior year period.

    Adjusted Gross Profit
    $83.7 millionvs $89.1 million Q2 FY25
    Q2 FY26

    Decreased from the prior year period, but percentage improved.

    Adjusted Gross Profit Percentage
    21.8%vs 21% Q2 FY25
    Q2 FY26

    Increased due to the acquisition of higher-margin Collagen and Kitchen Basics brands, the divestiture of the lower-margin Green Giant U.S. Frozen business, and certain tariff refunds.

    Base Business Net Sales
    $346.3 milliondecreased by $10.2 million or 2.9% vs Q2 FY25
    Q2 FY26

    Decrease driven by volume, partially offset by pricing, product mix, and foreign currency.

    Year-to-Date Base Business Net Sales
    $711.4 millionup $0.2 million vs YTD Q2 FY25
    YTD Q2 FY26

    Essentially flat compared to $711.2 million for the first two quarters of 2025, on track with plan.

    SG&A Expenses
    $40.6 milliondecreased by $6.6 million or 14% vs Q2 FY25
    Q2 FY26

    Decrease comprised of warehouse, general and administrative, consumer marketing, and selling expenses, partially offset by acquisition/divestiture-related and nonrecurring expenses.

    Net Interest Expense
    $38.5 millionincreased by $2.7 million or 7.5% vs Q2 FY25
    Q2 FY26

    Primarily attributable to an increase in average long-term debt and the 11% interest rate on new senior unsecured notes due 2031. Negatively impacted by a 24-day period of incurring interest on both old and new notes during debt refinancing.

    Green Giant U.S. Frozen Contract Manufacturing Revenue
    $23.9 million
    Q2 FY26

    Generated in its first full quarter of operation following the sale of the Green Giant U.S. Frozen business.

    Long-term Base Business Net Sales Growth Objective
    0% to 2%
    Long-term

    Long-term objective for the core business.

    Industry KPIs

    6
    MetricValueDetails
    Gross margin21.8%%
    Brand platform growthStrong growth
    Organic net revenue growth-2.9%%
    Adjusted EPS operating income$0.06per share
    Volume mix vs pricing decomposition-4.3% volume, +1.4% pricing and product mix%
    Elasticity consumer response commentaryUnder more pressure

    Deals & partnerships

    6
    Green Giant U.S. FrozenSale of the Green Giant U.S. Frozen business

    Divestiture occurred in early March 2026 as part of portfolio reshaping efforts to exit low-margin, working capital-intensive businesses.

    Lasor U.S. shelf-stableSale of Lasor U.S. shelf-stable brands

    Divestiture occurred in the summer of 2025 as part of portfolio reshaping efforts.

    Don PepinoSale of the Don Pepino brand

    Divestiture occurred in the summer of 2025 as part of portfolio reshaping efforts. Contributed $1.8 million to net sales in Q2 FY25.

    Collagen and Kitchen Basics brandsAcquisition of higher-margin, cash-generative brands

    Acquisition completed in late March 2026. These brands are expected to provide incremental growth and profitability.

    New owner of Green Giant U.S. Frozen businessContract manufacturing agreement for Green Giant U.S. Frozen products

    Commenced simultaneously with the Green Giant U.S. Frozen divestiture in early March 2026. B&G Foods produces products at its vegetable manufacturing facility in Mexico for the new owner.

    Green Giant CanadaSale of Green Giant Canada business

    Currently classified as an asset held for sale for accounting purposes. The divestiture has not yet closed and is expected to complete during the third quarter.

    Risks & headwinds

    8
    Fourth of July holiday timing impact on net salesQ2 FY26

    $5 million to $7 million net sales loss

    Lapping of 53rd week benefit from prior fiscal yearQ4 FY26

    $18 million in net sales

    Inflation in input costsOngoing

    Diesel fuel oil, vegetable oil, spices

    Mitigation: Expects to cover inflation where possible through pricing actions (e.g., Crisco).

    Acquisition/divestiture-related and nonrecurring expensesQ2 FY26

    $9.7 million

    Mitigation: Includes organizational restructuring efforts to reduce cost overhang related to divestitures.

    Geopolitical and macro demand disruptionFY26 and beyond

    Potential impact from conflicts in Eastern Europe, Middle East, Latin America; significant changes in inflation/tariff policies

    Mitigation: Guidance reflects only known factors and does not factor in significant changes from these risks.

    Stranded costs from recent divestituresOngoing, reducing into early Q3 FY26

    Impact on overhead structure

    Mitigation: Taking steps to reduce ongoing SG&A commitments to better reflect the size of the business.

    Shift in spice brands from branded to partner brandsOngoing

    Losing Tones distribution, replaced by B&G providing private label distribution

    Mitigation: Company aims to improve performance in these brands.

    Consumption softness and mispricing for Collagen brandCurrent

    Softness in consumption, mispriced under prior ownership

    Mitigation: Company is fixing pricing and looking forward to a strong holiday season.

    What to watch in Q3 FY26

    5

    Green Giant Canada Divestiture Completion

    Q3 FY26
    CurrentPending
    TargetClosed

    Why it matters

    Completion will finalize portfolio reshaping and impact the balance sheet, including debt reduction.

    We expect the Green Giant Canada divestiture to close during the third quarter and look forward to providing an update after the divestiture has been completed.

    Q&A highlights

    8

    How much did the tariff refund benefit Q2 EBITDA, and will there be more to come for the full year?

    Management stated the Q2 benefit was "relatively modest" and less than half of the total $8M-$9M tariff exposure where they were the direct importer. They expect more refunds throughout the year and plan to invest some back into the business.

    “We haven't disclosed the number. It's relatively modest. If you go back to kind of 2025 results and as we articulated then, we have about $8 million to $9 million of total incremental tariff exposure. That included tariffs where we were the direct importer of record.and where we were not the importer of record. Where we were the importer of record is about a little bit less than half of that, and that's largely what we got back in the second quarter.”

    asked by Andrew Lazar · answered by Bruce Wacha

    2 min read8 chapters

    Detailed Narrative

    01

    CEO Transition and Strategic Direction

    Rob Mills has been appointed as the new Chief Executive Officer, bringing eight years of board experience and extensive operating expertise from Tractor Supply Company. His immediate focus will be on strengthening execution, maximizing core brands, improving productivity and cash generation, and accelerating strategies for sustainable growth. Mills' background in digital transformation, data, and AI is expected to modernize operations and enhance decision-making.

    02

    Portfolio Reshaping Initiatives

    B&G Foods has actively reshaped its portfolio over the past 12 months, divesting low-margin, working capital-intensive businesses such as Green Giant U.S. Frozen, Lasor U.S. shelf-stable, and the Don Pepino brand. Concurrently, the company acquired higher-margin, cash-generative brands like Collagen and Kitchen Basics. The divestiture of Green Giant Canada is pending and expected to close in Q3 FY26.

    03

    Q2 FY26 Performance Overview

    Despite a 9.7% decrease in net sales to $383.3 million in Q2 FY26, primarily due to divestitures, the company demonstrated improved profitability. Adjusted EBITDA grew to $60.4 million (15.8% of net sales) from $58 million (13.7%) in Q2 FY25. Adjusted gross profit as a percentage of net sales also improved to 21.8%, benefiting from strategic M&A and tariff refunds.

    04

    Base Business Trends and Challenges

    Base business net sales decreased by $10.2 million or 2.9% in Q2 FY26, driven by a 4.3% volume decline, partially offset by a 1.4% increase from net pricing and product mix. The timing of📎 the Fourth of July holiday negatively impacted Q2 net sales by an estimated $5 million to $7 million. Year-to-date base business net sales remained essentially flat.

    05

    Cost Management and Efficiency

    Selling, general, and administrative (SG&A) expenses decreased by $6.6 million or 14% to $40.6 million, improving to 10.6% of net sales. The company is actively working to reduce ongoing SG&A commitments to minimize stranded costs resulting from recent divestitures and to align overhead with the current business size, with reductions expected into early Q3.

    06

    M&A Impact and Outlook

    The acquisition of Collagen and Kitchen Basics brands contributed approximately $13.2 million to Meals segment net sales and positively impacted overall gross margin. The newly commenced Green Giant U.S. Frozen contract manufacturing business generated $23.9 million in net sales in its first full quarter of operation and is modestly profitable, with plans to expand its customer base and volumes.

    07

    Inflation and Pricing Strategy

    Inflation, particularly in diesel fuel oil and vegetable oil, continues to be a factor, though slightly below peak levels. The company expects to implement pricing actions where possible to cover these costs, referencing previous successful adjustments for Crisco. Consumer elasticity is noted as a consideration given current economic pressures.

    08

    Non-Measured Channels and Brand Performance

    Non-measured channels, including Canada and foodservice, continue to exhibit strong growth, helping to offset challenges in regular track channels. While hot breakfast brands like Cream of Wheat are performing well, the company aims to improve overall retail brand business performance, addressing shifts in spice brands from branded to partner brands.

    AI-generated summary of the company’s earnings call. Not investment advice.