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Investing.com - The Marzetti Company (NASDAQ:MZTI) shares fell 3% on Thursday after the specialty food manufacturer reported fourth-quarter earnings that missed analyst expectations, despite posting record revenue that exceeded forecasts.
The company, which recently changed its name from Lancaster Colony Corporation, reported earnings of $1.18 per diluted share for its fiscal fourth quarter ended June 30, 2025, falling short of analyst estimates of $1.34.
Revenue rose 5% YoY to a record $475.4 million, surpassing the consensus estimate of $457.67 million.
Excluding $12.2 million in non-core sales from a temporary supply agreement with Winland Foods, consolidated net sales increased 2.3% compared to the same quarter last year.
The company’s Retail segment saw sales grow 3.1% to $241.6 million, while Foodservice segment sales increased 7.0% to $233.9 million.
CEO David A. Ciesinski attributed the retail growth to "expanding distribution for our popular Texas Roadhouse (NASDAQ:TXRH) dinner rolls and new club channel sales for Chick-fil-A sauce," adding that their "category-leading New York Bakery frozen garlic bread also achieved strong volume gains in the quarter."
The earnings miss was largely driven by increased SG&A expenses, which rose by $8.9 million to $62.1 million due to higher marketing costs to support retail brand growth.
Additionally, restructuring and impairment charges of $5.1 million, primarily related to the planned closure of a California facility, reduced the quarter’s earnings by $0.15 per share.
Gross profit increased $8.5 million to $106.1 million, with gross profit margin improving 70 basis points to 22.3%, supported by cost savings programs and a more favorable volume mix in the Retail segment.
Looking ahead to fiscal 2026, Ciesinski expects continued volume growth in the Retail segment, while noting that Foodservice segment performance may be impacted by "U.S. economic performance and consumer behavior."
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