SMPL 10-Q

Simply Good Foods Co (SMPL)

10-Q 2026-04-09 For: 2026-02-28

View Original

Added on April 12, 2026


Delaware						82-1038121
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)


		Page
PART I. Financial Information
Item 1.	Financial Statements (Unaudited)	3
	Consolidated Balance Sheets	3
	Consolidated Statements of Operations and Comprehensive Income	4
	Consolidated Statements of Cash Flows	5
	Consolidated Statements of Stockholders’ Equity	7
	Notes to Unaudited Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	31
Item 4.	Controls and Procedures	31
PART II. Other Information
Item 1.	Legal Proceedings	32
Item 1A.	Risk Factors	32
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	33
Item 3.	Defaults Upon Senior Securities	34
Item 4.	Mine Safety Disclosures	34
Item 5.	Other Information	34
Item 6.	Exhibits	35
	Signatures	36


	February 28, 2026		August 30, 2025
Assets
Current assets:
Cash	$	107,444	$	98,468
Accounts receivable, net	123,517		164,978
Inventories	189,780		167,217
Prepaid expenses	5,310		7,209
Other current assets	13,292		15,812
Total current assets	439,343		453,684

Long-term assets:
Property and equipment, net	42,694		39,738
Intangible assets, net	1,004,763		1,261,603
Goodwill	589,974		589,974
Other long-term assets	48,930		51,046
Total assets	$	2,125,704	$	2,396,045

Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	66,518	$	78,298
Accrued interest	63		44
Accrued expenses and other current liabilities	20,297		46,219
Total current liabilities	86,878		124,561

Long-term liabilities:
Long-term debt, less current maturities	396,866		249,066
Deferred income taxes	106,629		166,091
Other long-term liabilities	45,506		49,494
Total liabilities	635,879		589,212
See commitments and contingencies (Note 9)

Stockholders’ equity:
Preferred stock, $0.01 par value, 100,000,000 shares authorized, none issued	—		—
Common stock, $0.01 par value, 600,000,000 shares authorized, 104,033,175 and 103,688,071 shares issued at February 28, 2026, and August 30, 2025, respectively	1,040		1,037
Treasury stock, 13,548,075 shares and 3,957,571 shares at cost at February 28, 2026, and August 30, 2025, respectively	(319,397)		(129,337)
Additional paid-in-capital	1,353,320		1,346,687
Retained earnings	456,450		590,879
Accumulated other comprehensive loss	(1,588)		(2,433)
Total stockholders’ equity	1,489,825		1,806,833
Total liabilities and stockholders’ equity	$	2,125,704	$	2,396,045


	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	February 28, 2026		March 1, 2025		February 28, 2026		March 1, 2025
Net sales	$	326,013	$	359,655	$	666,211	$	700,923
Cost of goods sold	222,980		229,518		453,278		440,300
Gross profit	103,033		130,137		212,933		260,623

Operating expenses:
Selling and marketing	28,167		35,078		57,844		68,072
General and administrative	34,875		36,013		72,881		74,077
Depreciation and amortization	4,309		4,148		8,942		8,308
Business transaction costs	—		177		—		820
Loss on impairment	249,000		—		249,000		—
Total operating expenses	316,351		75,416		388,667		151,277

(Loss) income from operations	(213,318)		54,721		(175,734)		109,346

Other income (expense):
Interest income	880		701		1,379		1,477
Interest expense	(5,833)		(6,338)		(10,119)		(14,199)
Gain (loss) on foreign currency transactions	190		(125)		133		(5)
Other income	60		19		136		34
Total other (expense)	(4,703)		(5,743)		(8,471)		(12,693)

(Loss) income before income taxes	(218,021)		48,978		(184,205)		96,653
Income tax (benefit) expense	(58,323)		12,231		(49,776)		21,784
Net (loss) income	$	(159,698)	$	36,747	$	(134,429)	$	74,869

Other comprehensive income:
Foreign currency translation, net of reclassification adjustments	1,067		(426)		845		(813)
Comprehensive (loss) income	$	(158,631)	$	36,321	$	(133,584)	$	74,056

(Loss) earnings per share from net (loss) income:
Basic	$	(1.73)	$	0.36	$	(1.41)	$	0.74
Diluted	$	(1.73)	$	0.36	$	(1.41)	$	0.74
Weighted average shares outstanding:
Basic	92,343,383		101,040,501		95,546,361		100,724,155
Diluted	92,343,383		101,821,229		95,546,361		101,674,934


	Twenty-Six Weeks Ended
	February 28, 2026		March 1, 2025
Operating activities
Net (loss) income	$	(134,429)	$	74,869
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization	12,069		10,135
Amortization of deferred financing costs and debt discount	319		951
Stock compensation expense	7,627		8,792
Loss on impairment	249,000		—
Estimated credit losses	65		101
Unrealized (gain) loss on foreign currency transactions	(133)		5
Deferred income taxes	(59,462)		6,440
Amortization of operating lease right-of-use asset	2,978		3,369
Other	3,187		168
Changes in operating assets and liabilities:
Accounts receivable, net	41,744		(7,028)
Inventories	(25,401)		(22,445)
Prepaid expenses	1,868		(4,189)
Other current assets	2,577		(987)
Accounts payable	(11,200)		16,566
Accrued interest	19		(206)
Accrued expenses and other current liabilities	(28,454)		(19,470)
Other assets and liabilities	(4,180)		(3,804)
Net cash provided by operating activities	58,194		63,267

Investing activities
Purchases of property and equipment	(7,633)		(802)
Acquisition of business, net of cash acquired	—		1,713
Investments in intangible and other assets	—		(911)
Net cash used in investing activities	(7,633)		—

Financing activities
Proceeds from option exercises	1,056		10,136
Tax payments related to issuance of restricted stock units and performance stock units	(2,047)		(2,522)
Repurchase of common stock	(188,181)		—
Principal payments of long-term debt	—		(100,000)
Proceeds from issuance of long-term debt	150,000		—
Deferred financing costs	(2,632)		—
Net cash used in financing activities	(41,804)		(92,386)

Cash and cash equivalents
Net increase (decrease) in cash	8,757		(29,119)
Effect of exchange rate on cash	219		271
Cash at beginning of period	98,468		132,530
Cash and cash equivalents at end of period	$	107,444	$	103,682


(Mark One)
☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


OR
o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to ________


	Common Stock			Treasury Stock			Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Total
	Shares	Amount		Shares	Amount
Balance at August 30, 2025	103,688,071	$	1,037	3,957,571	$	(129,337)	$	1,346,687	$	590,879	$	(2,433)	$	1,806,833
Net income	—	—		—	—		—		25,269		—		25,269
Stock-based compensation	—	—		—	—		3,083		—		—		3,083
Foreign currency translation adjustments	—	—		—	—		—		—		(222)		(222)
Repurchase of common stock	—	—		4,983,514	(100,689)		—		—		—		(100,689)
Shares issued upon vesting of restricted stock units and performance stock units	164,184	1		—	—		(1,215)		—		—		(1,214)
Exercise of options to purchase common stock	88,000	1		—	—		1,055		—		—		1,056
Balance at November 29, 2025	103,940,255	$	1,039	8,941,085	$	(230,026)	$	1,349,610	$	616,148	$	(2,655)	$	1,734,116
Net (loss) income	—	—		—	—		—		(159,698)		—		(159,698)
Stock-based compensation	—	—		—	—		4,544		—		—		4,544
Foreign currency translation adjustments	—	—		—	—		—		—		1,067		1,067
Repurchase of common stock	—	—		4,606,990	(89,371)		—		—		—		(89,371)
Shares issued upon vesting of restricted stock units	92,920	1		—	—		(834)		—		—		(833)








Balance at February 28, 2026	104,033,175	$	1,040	13,548,075	$	(319,397)	$	1,353,320	$	456,450	$	(1,588)	$	1,489,825


	Thirteen Weeks Ended				Twenty-Six Weeks Ended
(In thousands)	February 28, 2026		March 1, 2025		February 28, 2026		March 1, 2025
North America (1)
Atkins	$	79,717	$	108,650	$	169,987	$	216,818
Quest	211,442		210,771		421,785		402,708
OWYN	28,135		33,806		59,317		66,060
Total North America	319,294		353,227		651,089		685,586
International	6,719		6,428		15,122		15,337
Total net sales	$	326,013	$	359,655	$	666,211	$	700,923
(1) The North America geographic area consists of net sales substantially related to the United States and there is no individual foreign country to which more than 10% of the Company’s net sales are attributed or that is otherwise deemed individually material.


				February 28, 2026
(In thousands)	Useful life			Gross carrying amount		Accumulated amortization		Net carrying amount
Intangible assets with indefinite life:
Brands and trademarks	Indefinite life			$	893,000	$	—	$	893,000
Intangible assets with finite lives:
Customer relationships	15 years			194,500		84,621		109,879
Licensing agreements	10 years			16,072		15,195		877
Proprietary recipes and formulas	7 years			7,000		7,000		—
Software and website development costs	3	-	5 years	6,641		5,634		1,007

				$	1,117,213	$	112,450	$	1,004,763


(In thousands)	Amortization
Remainder of 2026	$	7,759
2027	13,575
2028	12,967
2029	12,967
2030	12,967
2031 and thereafter	51,528
Total	$	111,763


(In thousands)	Balance Sheets Caption	February 28, 2026		August 30, 2025
Assets
Operating lease right-of-use assets	Other long-term assets	$	41,140	$	44,118

Total lease assets		$	41,140	$	44,118
Liabilities
Current:
Operating lease liabilities	Accrued expenses and other current liabilities	$	7,474	$	5,867

Long-term:
Operating lease liabilities	Other long-term liabilities	45,506		49,494

Total lease liabilities		$	52,980	$	55,361


(In thousands)	Operating Leases
Fiscal year ending:
Remainder of 2026	$	5,037
2027	10,927
2028	10,388
2029	10,438
2030	10,549
Thereafter	16,146
Total lease payments	63,485
Less: Interest	(10,505)
Present value of lease liabilities	$	52,980


	February 28, 2026		August 30, 2025
Weighted-average remaining lease term (in years)
Operating leases	5.82		6.31

Weighted-average discount rate
Operating leases	6.0	%	6.0	%


	Thirteen Weeks Ended				Twenty-Six Weeks Ended
(In thousands, except per share data)	February 28, 2026		March 1, 2025		February 28, 2026		March 1, 2025
Basic (loss) earnings per share computation:
Numerator:
Net (loss) income available to common stockholders	$	(159,698)	$	36,747	$	(134,429)	$	74,869
Denominator:
Weighted average common shares outstanding - basic	92,343,383		101,040,501		95,546,361		100,724,155
Basic (loss) earnings per share from net (loss) income	$	(1.73)	$	0.36	$	(1.41)	$	0.74

Diluted earnings per share computation:
Numerator:
Net (loss) income available for common stockholders	$	(159,698)	$	36,747	$	(134,429)	$	74,869

Numerator for diluted (loss) earnings per share	$	(159,698)	$	36,747	$	(134,429)	$	74,869
Denominator:
Weighted average common shares outstanding - basic	92,343,383		101,040,501		95,546,361		100,724,155

Employee stock options	—		643,584		—		777,751
Non-vested stock units	—		137,144		—		173,028
Weighted average common shares - diluted	92,343,383		101,821,229		95,546,361		101,674,934
Diluted (loss) earnings per share from net (loss) income	$	(1.73)	$	0.36	$	(1.41)	$	0.74


	Shares underlying options	Weighted average exercise price		Weighted average remaining contractual life (years)
Outstanding as of August 30, 2025	1,476,243	$	25.44	4.61
Granted	2,059,311	20.93
Exercised	(88,000)	12.00
Forfeited	(8,632)	32.99
Outstanding as of February 28, 2026	3,438,922	$	23.06	6.45
Vested and expected to vest as of February 28, 2026	3,438,922	$	23.06	6.45
Exercisable as of February 28, 2026	1,339,698	$	25.96	4.07


	Units	Weighted average grant-date fair value
Non-vested as of August 30, 2025	639,015	$	36.14
Granted	557,554	20.29
Vested	(301,786)	32.63
Forfeited	(87,211)	31.56
Non-vested as of February 28, 2026	807,572	$	27.01


	Units	Weighted average grant-date fair value
Non-vested as of August 30, 2025	278,193	$	52.66
Granted	290,348	23.92
Vested	(56,651)	62.55
Forfeited	(158,294)	37.37
Non-vested as of February 28, 2026	353,596	$	34.32


	Twenty-Six Weeks Ended	Twenty-Six Weeks Ended
	February 28, 2026	March 1, 2025
Expected volatility	29.96%	31.38%
Expected dividend yield	—%	—%
Expected performance term	2.93	2.93
Risk-free rate of return	3.54%	4.14%
Fair value	$22.22	$54.41


	Shares underlying SARs	Weighted average exercise price
Outstanding as of August 30, 2025	150,000	$	37.67
Granted	—	—
Exercised	—	—
Forfeited	—	—
Outstanding as of February 28, 2026	150,000	$	37.67
Vested as of February 28, 2026	150,000	$	37.67
Exercisable as of February 28, 2026	150,000	$	37.67


(in thousands)	Termination benefits, severance and other		Total Liability
Balance as of August 30, 2025	$	—	$	—
Charges	4,524		4,524
Cash payments	(3,462)		(3,462)
Non-cash settlements or adjustments	—		—
Balance as of February 28, 2026	$	1,062	$	1,062


Period	Total number of shares purchased	Average price paid per share(2)		Total number of shares purchased as part of publicly announced plans or programs(1)	Maximum dollar value of shares that may yet be purchased under the plans or programs(1)
November 30, 2025 - January 3, 2026	2,230,028	$	19.80	2,230,028	$	227,843,042
January 4, 2026 - January 31, 2026	1,319,409	20.38		1,319,409	200,952,579
February 1, 2026 - February 28, 2026	1,057,553	17.41		1,057,553	182,536,578
Total	4,606,990	$	19.74	4,606,990	$	182,536,578
(1) Represents shares repurchased under our stock repurchase program adopted in November 2018. On January 6, 2026, the Company announced that its Board of Directors approved a $200.0 million repurchase authorization under its stock repurchase program (the “Current Authorization”). As of February 28, 2026, approximately $182.5 million remained available under the Current Authorization. Under the stock repurchase program, we may repurchase shares from time to time in the open market or in privately negotiated transactions. The stock repurchase program does not obligate us to acquire any specific number of shares over any specific period of time. We may suspend or discontinue the stock repurchase program at any time, and the stock repurchase program does not have an expiration date.
(2) Average price paid per share includes commissions, but excludes our liability under the 1% excise tax on the net amount of share repurchases required by the Inflation Reduction Act of 2022.


Exhibit No.						Document
10.1						Employment Agreement, dated January 19, 2026, between The Simply Good Foods Company and Joseph E. Scalzo (incorporated by reference to Exhibit 10.1 to our Form 8-K filed on January 21, 2026).
10.2						The Simply Good Foods Company Stand-Alone Inducement Award - Nonqualified Stock Option Grant Notice and Agreement with Joseph E. Scalzo (incorporated by reference to Exhibit 10.2 to our Form 8-K filed on January 21, 2026).
10.3						Separation Agreement and General Release, dated January 18, 2026, by and between Geoff E. Tanner and Simply Good Foods USA, Inc., and for certain purposes therein, The Simply Good Foods Company (incorporated by reference to Exhibit 10.3 to our Form 8-K filed on January 21, 2026).
10.4						The Simply Good Foods Company Incentive Plan (dated as of January 28, 2026) (incorporated by reference to Exhibit 99.1 to our Registration Statement on Form S-8, File Number 333-293244, filed on February 6, 2026).
31.1*						Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes Oxley Act of 2002.
31.2*						Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes Oxley Act of 2002.
32.1**						Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes Oxley Act.
101.INS*						XBRL Instance Document (the instance document does not appear on the Interactive Data File because the XBRL tags are embedded within the Inline XBRL document)
101.SCH*						XBRL Taxonomy Extension Schema Document
101.CAL*						XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*						XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*						XBRL Taxonomy Extension Label Linkbase Document
101.PRE*						XBRL Taxonomy Extension Presentation Linkbase Document
104						Cover Page Interactive Data File (embedded within the Inline XBRL document and contained in Exhibit 101).
* Filed herewith.
** Furnished herewith.