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FORT WORTH, Texas - Farmer Bros Co (NASDAQ:FARM) saw its stock surge 54% after reporting better-than-expected second quarter fiscal 2025 earnings, despite a slight miss on revenue. The coffee roaster and distributor posted adjusted earnings per share of $0.01, beating analyst estimates of a $0.09 loss per share.
For the quarter ended December 31, 2024, Farmer Bros reported net sales of $90 million, just shy of the $90.15 million consensus estimate but up slightly from $89.5 million in the same quarter last year. The company’s gross margin improved significantly, increasing 270 basis points YoY to 43.1%.
Net income for the quarter came in at $210,000, compared to $2.7 million in the prior year period. However, the company noted that last year’s results included a $6.1 million net gain from asset disposals, while this quarter saw a $1.5 million net loss from asset disposals.
Adjusted EBITDA rose to $5.9 million, a substantial increase from $2.3 million in the second quarter of fiscal 2024.
"The second quarter was one of our strongest performing quarters in quite some time despite the challenging market environment," said Farmer Brothers President and CEO John Moore. "We saw continued improvements in sales, operating expenses and adjusted EBITDA, as well as gross margins above 43% for the second straight quarter."
The company highlighted its focus on driving growth in top line, coffee pounds, and customer counts while continuing to optimize operations. Farmer Bros also noted progress on its SKU rationalization and brand pyramid initiatives, which are expected to be completed in the third quarter of fiscal 2025.
As of December 31, 2024, Farmer Bros had $5.5 million in unrestricted cash and cash equivalents and $23.7 million available under its revolving credit facility.
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