Post Holdings Inc (POST) Q3 2024 Earnings Report

Post Holdings delivered a solid Q3 2024 with year-over-year revenue growth and meaningful margin expansion, underpinned by discipline in cost of goods sold and selling, general and administrative expenses. The quarter produced EBITDA of $329.2 million and net income of $99.8 million, translating to earnings per share of $1.66 (GAAP) and $1.49 (diluted). Operating cash flow was robust at $272.3 million, supporting free cash flow of $161.5 million despite continued capital discipline in a highly leveraged capital structure. The company supplemented cash generation with a substantial share repurchase program ($203.9 million), while continuing to carry a heavy debt burden (total debt of $6.399 billion; net debt of ~$6.065 billion) and a debt-to-capitalization ratio of 0.619.

The improved profitability occurred even as revenue rose 4.75% YoY (+ QoQ decline of 2.57%), with gross profit up 15.1% YoY and a gross margin of 29.64%. Operating income rose 28.36% YoY, producing an 10.43% operating margin. Net margin stood at 5.12% with an efficient tax rate of ~24.1%. Cash flow from operations supported a healthy cash balance, but the balance sheet remains heavily levered, and the company does not currently pay a dividend. Looking ahead, management commentary (not included in the supplied transcripts) is typically focused on the growth of BellRing Brands, the international potential of Weetabix, and ongoing cost discipline as levers for deleveraging and profitability. Investors should monitor debt levels, commodity input costs, mix-driven margin trajectory, BellRing growth, and opportunities in e-commerce and international markets as key catalysts.

Overall, POST presents a constructive near-term profitability trajectory and solid cash generation, but the elevated leverage and lack of a dividend imply a cautious stance on multiple expansion until deleveraging progresses further.