Post Holdings foodservice unit accelerates while retail segments stall in Q3 2021

Q3 2021 net sales were $1.6bn, an increase of 19% (or $253.4 million including $78.5m in net sales from acquisitions made in the past two years) compared to $1.3bn in the prior year period.

While Post’s two major retail segments – Post Consumer Holdings and Refrigerated Retail business –declined by double digits vs. one year ago, Post’s foodservice business has taken off, growing net sales by 80% year on year in Q3, primarily driven by out-of-home demand for its egg and potato products (albeit compared to a very low benchmark from the year prior when much of the food service industry came to a screeching halt).

“Setting aside uncertainty around the Delta variant, we remain extremely encouraged by the progress,”​ said Post Holdings president and CEO Robert V. Vitale during the company’s Q3 2021 earnings call.

Also experiencing strong double-digit growth for the quarter was the company’s ready-to-drink protein shakes business which includes the Premier Protein brand, which experienced a 68% lift to net sales to $342.6m compared to the prior year.

Consumers premiumize cereal purchases

The Post-branded cereal products performed in line or better than the category, achieving a 12.5% market share of the ready-to-eat cereal category, however, net sales were down 11% in Q3 2021 compared to the same period last year, noted Vitale.

“Post Consumer Brands had a soft volume quarter, largely attributable to what we believe is a temporary consumer shift toward premium purchasing,”​ said Vitale.

While several brands within Post’s portfolio have benefited from the consumer shift, other areas of the business – such as its recent acquisition of TreeHouse Foods’ private label cereal business for $85m​ earlier this year – were adversely impacted, said Vitale.

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