TreeHouse Foods Reports $31.8 Million Net Loss and Decrease in Sales for Q1 2025

TreeHouse Foods, Inc. reported a net loss of $31.8 million for the first quarter of 2025, a significant increase from the $11.7 million loss recorded in the same period last year. The company's net sales decreased by 3.5% to $792.0 million, down from $820.7 million in the first quarter of 2024. This decline was attributed to several factors, including unfavorable volume/mix related to margin management actions, broader macroeconomic consumption trends, and service impacts from a voluntary recall of frozen griddle products. The company also noted a decrease in sales from its ready-to-drink (RTD) business, which it exited in 2024, although this was partially offset by the acquisition of the private brand tea business, which contributed approximately $38.6 million in sales.

In terms of operational efficiency, TreeHouse Foods has undertaken a restructuring initiative aimed at improving profitability and cash flow. This includes the closure of its New Hampton, Iowa facility, which is expected to cease production in the third quarter of 2025. The company plans to consolidate production into two existing facilities in Michigan and Illinois. Additionally, TreeHouse incurred $18.3 million in restructuring costs during the first quarter, primarily related to severance expenses. The company also reported a gross profit margin of 14.5%, an increase from 13.6% in the prior year, driven by supply chain savings initiatives and favorable pricing strategies.

TreeHouse Foods completed the acquisition of Harris Freeman & Co., Inc.'s private brand tea business for approximately $207.6 million on January 2, 2025. This acquisition aligns with the company's strategy to enhance its capabilities in higher-growth, higher-margin categories. The results from this acquisition contributed $38.6 million in net sales and $1.9 million in income before income taxes from the date of acquisition through March 31, 2025. The company also incurred $3.0 million in acquisition-related costs during the same period.

The company’s total liabilities decreased slightly to $2.4 billion as of March 31, 2025, compared to $2.43 billion at the end of 2024. Long-term debt increased to $1.42 billion, reflecting the refinancing of its credit facilities in January 2025. TreeHouse Foods has a revolving credit facility with $25 million drawn and $443.1 million available as of the end of the first quarter. The company remains in compliance with its debt covenants and expects to meet its financial requirements moving forward.

Looking ahead, TreeHouse Foods anticipates continued challenges due to inflationary pressures affecting consumer spending and overall food and beverage consumption trends. The company is actively monitoring these conditions and may implement further pricing actions to recover increased commodity costs. Despite these challenges, TreeHouse remains focused on its strategic initiatives, including enhancing operational efficiencies and pursuing growth opportunities through acquisitions.