Costs linked to plant closure hit Posts bottom line

Costs linked to plant closure hit Post's bottom line

US food group Post Holdings has reported lower annual profits on the back of costs linked to a plant closure and higher finance costs, although acquisitions helped sales grow.

The Grape Nuts breakfast cereal owner yesterday (20 November) booked net earnings of US$9.8m for the year to 30 September, down from $49.9m a year earlier.

Post rounded off the year with a fourth-quarter loss of $3.2m, which compared to a profit of $10.8m in the corresponding period the year before.

Charges worth $13.4m from Post's move to close a plant in California, which it announced in April, hit its bottom line in both the quarter and across the year. The company said it expected to run up a further $9.9m in costs in its new financial year.

However, Post saw its net sales increase 7.8% to $1.03bn thanks in the main to recent acquisitions including Attune Foods, protein food and drink firm Active Nutrition and Hearthside's cereal, granola and snack businesses. The company said its base Post Foods operations saw sales grow 2.5%.

Looking to its current financial year, Post forecast adjusted EBITDA of $245-260m. In the year to the end of September, it generated adjusted EBITDA of $216.7m.

Post is also in the process of buying US pasta supplier Dakota Growers Pasta Co. It announced the $370m deal in September and said yesterday it expects the acquisition to be finalised in January.