Lenexa, KS-based Hostess Brands Inc. (Nasdaq: TWNK, TWNKW) reported strong financial results for the fourth quarter and year ended Dec. 31, 2020.
For the full year, Hostess’s net revenue increased 15.7% and adjusted net revenue increased 16.4%*, driven by Voortman Cookies Ltd. and Hostess branded growth. Gross profit increased 21.1 and net income was $68.4 million.
The fourth quarter had revenue of $256 million, an increase of 18.1%, driven primarily by strong performance of Voortman and Hostess sales, partially offset by other non-Hostess branded sales. Here are other key fourth-quarter highlights, compared with the previous period:
» Gross profit was $95.8 million, an increase of 35.3%. On an adjusted basis, gross profit increased 27.2%, primarily due to improved price and mix, the accretive margin expansion generated from Voortman and operational efficiencies.
» Net income was $24.4 million, or $0.18 per diluted share compared with $23.6 million, or $0.17 per diluted share. Adjusted net income increased $5.9 million, or 25.9%, to $28.7 million, resulting in $0.21 adjusted EPS compared to $0.16 adjusted EPS. The increases in adjusted net income and adjusted EPS were primarily due to the accretion from Voortman and an increase in Hostess branded sales.
» Adjusted EBITDA was $63.7 million, or 24.9% of net revenue, an increase of 21.6%. The increase was primarily driven by Voortman's adjusted EBITDA contribution and higher Hostess branded sales.
» Cash and cash equivalents were $173.0 million as of Dec. 31, 2020, resulting in a leverage ratio of 3.9x.
Click here to see Hostess’s full financial press release and consolidated balance sheets.