Slide 1: Q4 & FY 2024 Earnings
Q4 & FY 2024 Earnings February 20, 2025 1 Q4 & FY 2024 EARNINGS PRESENTATION
Slide 2: Forward Looking Statements & Non-GAAP Measures
Forward Looking Statements & Non-GAAP Measures FORWARD-LOOKING STATEMENTS adjusted SG&A as a % of net sales. These non-GAAP financial measures component of internal budgeting and setting management should be considered as supplements to GAAP reported measures, compensation. The non-GAAP measures are
Slide 3: Freshpet mission statement
Freshpet strengthens the bond between people and our pets so that we both live longer, healthier and happier lives while being kind to the planet. 3 Q4 & FY 2024 EARNINGS PRESENTATION
Slide 4: Highlights
Highlights 4 Q4 & FY 2024 EARNINGS PRESENTATION
Slide 5: Fiscal year 2024 was a breakout year for Freshpet
“Fiscal year 2024 was a breakout year for Freshpet. We continued to deliver the exceptional net sales growth investors have come to expect from Freshpet but also delivered very strong profit improvements… This strong performance also enables us to raise our long-term profit margin targets today to r
Slide 6: Q4 & FY 2024: Solid growth with scale advantages
Q4 & FY 2024: Solid growth with scale advantages FINANCIAL RETAIL All comparisons to prior year period Q4 2024 FY 2024 FY 2024 Net Sales $262.7M $975.2M Household Penetration +17% Net Sales Growth YoY +22% +27% Buy Rate +6% Adjusted Gross Margin* 48.1% 46.5% Cubic Feet +12% Adjusted EBITDA $52.6M $1
Slide 7: Strong performance driven by key fundamentals
Strong performance driven by key fundamentals: Strength of the Freshpet Improved operational Operating discipline growth model effectiveness to balance capacity and demand at a high growth rate • Strong, consistent net sales • 740 basis point improvement • Expanding capacity on-budget growth across
Slide 8: Long-term tailwinds supporting our growth
Long-term tailwinds supporting our growth: Humanization of Pets • Growing importance of pets in our lives; long-term trend we have seen for over a decade • Parents waiting longer to have kids, having less kids and getting pet instead Value • Consumers recognize quality for the price, not just price
Slide 9: Vast runway for growth in a growing category
Vast runway for growth in a growing category $54B U.S. pet food category1 96% $37B Dog food category1 3.4% Freshpet market share of fresh/frozen in Freshpet market share of dog food1 measured channels2 9 1. NIQ Total US Pet Food $ - OmniChannel by Category 52 Weeks Ended 12/28/24 Q4 & FY 2024 EARNIN
Slide 10: Continued growth in consumer franchise; added ~2m households YoY
Continued growth in consumer franchise; added ~2m households YoY Freshpet Household Penetration Growth (in millions) (52 weeks) 13.5 11.6 +17% 9.9 +17% 8.6 +15% 7.3 +17% 2020 2021 2022 2023 2024 10 Source: Numerator Panel data for the 52-week periods ending 12/31/20, 12/31/21, 12/31/22, 12/31/23, an
Slide 11: Freshpet sales increasingly concentrated in heaviest users
Freshpet sales are increasingly concentrated in our heaviest users– now called MVP’s* – and account for 69% of FY 2024 net sales 2.5 Freshpet Users who are Ultra/Super Heavy Buyers (in millions) 2.1 515 Ultra/Super 2.0 Heavy HHP Ultra/Super Heavy Buy Rate 1.6 495 1.5 $477.33 1.3 $473.85 475 0.9 69%
Slide 12: Converting toppers into main meal users will increase buy rate
Converting toppers into main meal users will continue to increase buy rate Freshpet Buy Rate $104.89 (52 weeks) $99.30 $90.71 +6% +9% $76.58 +18% $71.72 +7% 2020 2021 2022 2023 2024 12 Source: Numerator Panel data for the 52-week periods ending 12/31/20, 12/31/21, 12/31/22, 12/31/23, and 12/31/24 Q4
Slide 13: Expanding depth and breadth: 22% of stores have multiple fridges
Expanding depth and breadth: 22% of all stores have multiple fridges Freshpet Store Count Number of Fridges per Store* YOY +1,364 28,141 26,777 25,281 Second/Third 23,631 Fridges 22,716 22% 21,570 19,499 18,004 16,609 15,015 13,387 One Fridge 78% 10,826 2013 2014 2015 2016 2017 2018 2019 2020 2021 2
Slide 14: Improved costs by 740 bps in FY 2024
Improved costs by 740 bps in FY 2024 across key focus areas -150 bps -150 bps -440 bps FY 2024 FY 2024 FY 2024 14 Source: Internal Data; All comparisons to prior year period Q4 & FY 2024 EARNINGS PRESENTATION
Slide 15: Capacity Update
Capacity Update # Lines Facility # Lines Today Projected Bethlehem Kitchen 6 7 Kitchen South 3 7 Ennis Kitchen 5 10+ Total 14 24+ Fifth roll line in Ennis installed and provides necessary roll capacity well into 2026 Kitchen South bag line install underway, startup expected later in 1Q 2025 New prod
Slide 16: Capital Efficiency Framework
Capital Efficiency Framework MORE OUT OF MORE OUT OF DEVELOP & IMPLEMENT EXISTING LINES EXISTING SITES NEW TECHNOLOGIES 16 Q4 & FY 2024 EARNINGS PRESENTATION
Slide 17: Q4 2024 Results
Q4 2024 Results 17 Q4 & FY 2024 EARNINGS PRESENTATION
Slide 18: Q4 results demonstrate strong growth in-line with guidance
Q4 results demonstrate strong growth in-line with our guidance Q4 2024 Net Sales ($m) Q4 2024 Net Sales Bridge $262.7 2.0% 21.7% 22.0% $215.4 +22% -1.7% Q4 2023 Q4 2024 Measured Non-Measured Non-Measured Trade Inventory NetNet SalesSales Growth Measured Sales Sales Growth Growth Sales Growth Trade I
Slide 19: Broad based consumption growth across channels
Broad based consumption growth across channels Q4 2024 Consumption Growth ($) Consumption Growth Trends (volume in pounds) 22% 23% 31% 20% 28% 25% 26% 21% 10% Total US Pet XAOC Food Pet Specialty Retail Plus Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2024 UNMEASURED CHANNEL ADDED 2 PTS OF GROWTH 19 Source:
Slide 20: Q4 2024 delivered significant margin improvement
Q4 2024 delivered significant margin improvement Q4 2024 Adj. Gross Margin Q4 2024 Adj. EBITDA ($m) % of net sales % of net sales 48.1% $52.6 20.0% $31.3 41.1% 14.5% Q4 2023 Q4 2024 Q4 2023 Q4 2024 34.6% 42.5% $15.3m $18.1m Gross Margin (GAAP) Net Income 20 Source: Internal Data Q4 & FY 2024 EARNING
Slide 21: 650 basis point improvement in Q4 2024
650 basis point improvement in Q4 2024; demonstrated our ability to deliver our previous FY 2027 margin targets Key Margin Improvement Targets & Progress Q4 2023 Q4 2024 Previous 2027 Target 33.9% 33.5% 28.4% 6.3% 6.2% 7.5% 3.6% 2.7% 2.9% Input Costs Logistics Quality 21 Source: Internal Data Q4 & F
Slide 22: FY 2024 Results
FY 2024 Results 22 Q4 & FY 2024 EARNINGS PRESENTATION
Slide 23: Strong FY 2024 results demonstrate volume-driven growth
Strong FY 2024 results demonstrate volume-driven growth FY 2024 Net Sales ($m) FY 2024 Net Sales Bridge $975.2 26% 1% 27% $766.9 +27% FY 2023 FY 2024 Volume Price/Mix Net Sales Growth 23 Source: Internal Data Q4 & FY 2024 EARNINGS PRESENTATION
Slide 24: FY 2024 delivered significant margin improvement
FY 2024 delivered significant margin improvement FY 2024 Adj. Gross Margin FY 2024 Adj. EBITDA ($m) % of net sales % of net sales 46.5% $161.8 16.6% 40.0% $66.6 8.7% FY 2023 FY 2024 FY 2023 FY 2024 32.7% 40.6% ($33.6m) $46.9m Gross Margin (GAAP) Net Income (loss) 24 Source: Internal Data Q4 & FY 202
Slide 25: 740 basis point improvement in FY 2024
740 basis point improvement in FY 2024; demonstrated our ability to deliver FY 2027 margin targets again Key Margin Improvement Targets & Progress FY 2023 FY 2024 Previous 2027 Target 34.1% 33.5% 29.7% 7.5% 7.5% 6.0% 4.1% 2.9% 2.6% Input Costs Logistics Quality 25 Source: Internal Data Q4 & FY 2024
Slide 26: Adj. Gross Margin improvement ahead of previous long-term target
Significant Adj. Gross Margin improvement YOY; ahead of our previous long-term target Adj. Gross Margin Progress vs. Previous 2027 Target 46.5% 45.0% 40.0% FY 2023 FY 2024 Previous 2027 Target 26 Source: Internal Data Q4 & FY 2024 EARNINGS PRESENTATION
Slide 27: FY 2025 Guidance
FY 2025 Guidance 27 Q4 & FY 2024 EARNINGS PRESENTATION
Slide 28: FY 2025 Guidance
FY 2025 Guidance FY 2025 Net Sales $1.18B – $1.21B Net Sales Growth YoY 21 – 24% Adjusted EBITDA >$210M Capital Expenditures ~$250M Additional considerations: • Net Sales: Expect the sales growth rate to be slightly higher in the second half of 2025 • Adjusted Gross Margin: Expect modest expansion •
Slide 29: Updated 2027 Targets
Updated 2027 Targets $1.8 billion Advertising & Net Sales Target Innovation 48% Adjusted Gross Drive Expand HH Margin Target Efficiencies Penetration (45% previously) Build Organization Capability to Increase Increase 22% Velocity 20 million Effectiveness & Leverage Scale Adjusted EBITDA Margin Targe
Slide 30: Capital Spending, Cash Flow & Liquidity
Capital Spending, Cash Flow & Liquidity 30 Q4 & FY 2024 EARNINGS PRESENTATION
Slide 31: Significant improvement in operating cash flow YoY
Significant improvement in operating cash flow YoY Capital Spending: Operating Cash Flow ($m) • Key projects remain on-track and on-budget • 2024 spend of $187 million and estimated 2025 spending of $250 million due to the shift in spend and installation of new capacity $154.3 across all three Kitch
Slide 32: Appendix
Appendix 32 Q4 & FY 2024 EARNINGS PRESENTATION
Slide 33: Reconciliation between Gross Profit and Adjusted Gross Profit
Freshpet, Inc. and Subsidiaries Reconciliation between Gross Profit and Adjusted Gross Profit Three Months Ended Year Ended December 31, December 31, 2024 2023 2024 2023 (Dollars in thousands) Gross profit $ 111,600 $ 74,575 $ 395,956 $ 250,872 Depreciation expense 13,358 8,103 49,056 41,209 Non-cash
Slide 34: Reconciliation between Net Income (loss) and Adjusted EBITDA
Freshpet, Inc. and Subsidiaries Reconciliation between Net Income (loss) and Adjusted EBITDA Three Months Ended Year Ended December 31, December 31, 2024 2023 2024 2023 (Dollars in thousands) Net income (loss) $ 18,123 $ 15,289 $ 46,925 $ (33,614) Depreciation and amortization 19,138 12,351 70,803 5
Slide 35: Convertible Share Dilution Calculations at Maturity
Convertible Share Dilution Calculations at Maturity We have run share dilution calculations to compare outcomes for the 2028 convertible notes Freshpet has structured the convertible with Flexible Settlement, so we have the option to settle the convertible in shares, cash, or a combination at it
Slide 36: Q4 & FY 2024 EARNINGS PRESENTATION
36 Q4 & FY 2024 EARNINGS PRESENTATION
Slide 37: Q4 & FY 2024 EARNINGS PRESENTATION
37 Q4 & FY 2024 EARNINGS PRESENTATION