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    Bellring Brands Inc (BRBR)

    Q2 2024 Earnings Summary

    Reported on Apr 14, 2025 (After Market Close)
    Pre-Earnings Price$58.44Last close (May 7, 2024)
    Post-Earnings Price$58.69Open (May 8, 2024)
    Price Change
    $0.25(+0.43%)
    • Expanding Production Capacity: The company is scaling up its production facilities, targeting a 20%+ production increase in 2025 through the ramp-up of two new greenfield facilities, which will support robust sales growth.
    • Strong Brand Momentum and Household Penetration: Premier Protein achieved an all-time high household penetration of 18-19%, coupled with a strong repeat rate of about 50%, indicating successful consumer acquisition and retention across various channels.
    • Robust Sales and Effective Promotional Strategy: With 28% year-over-year net sales growth and successful promotional initiatives (including two notable club promotions), the company is maintaining strong margins and driving continued demand even as non-promoted sales also perform well.
    • Margin Pressure from Promotions: Aggressive promotional activity, which was a key driver in Q2, created pricing headwinds that might continue to erode margins if similar discount tactics persist in future quarters.
    • Supply Constraints and Inventory Challenges: Repeated mentions of insufficient internal inventory and temporary out-of-stocks indicate production delays that may limit revenue growth if demand continues to outpace supply.
    • Rising Input Costs: The expectation of significant increases in product and logistics costs—especially for powders and shakes—poses a risk to profitability if these higher costs are not fully passed on to consumers.
    1. Guidance Potential
      Q: Can demand exceed high-end guidance?
      A: Management noted they have the production flexibility to meet and even exceed the high-end guidance if demand stays robust.

    2. Revenue Outlook
      Q: Will Q3 revenue be higher than Q2?
      A: The company expects a modest sequential increase in Q3 revenue compared to Q2.

    3. Gross Margin Build-Up
      Q: How built 300 bp margin expansion?
      A: They attributed the 300 basis point gain primarily to lower protein costs versus last year, partially offset by promotions.

    4. Gross Margin Seasonality
      Q: Are Q3 and Q4 margins comparable?
      A: Management expects margins in Q3 and Q4 to be similar, with Q3 showing slightly better year-over-year favorability.

    5. Margin Drivers
      Q: What factors drove margin expansion?
      A: Key drivers included lower protein costs, volume leverage, and some nonrecurring adjustments, mildly offset by promotions.

    6. Cost Outlook
      Q: Will input costs moderate this quarter?
      A: Costs are projected to increase sequentially in Q3—especially for powders—even though protein costs remain relatively favorable.

    7. Capacity Expansion
      Q: What are the 2025 capacity plans?
      A: They plan to grow shake production by over 20% in 2025, supported by expanding greenfield facilities.

    8. Powder Investment
      Q: Will resources shift between powder brands?
      A: Management intends to support both brands, with an extra focus on Premier Powder given its strong growth trajectory.

    9. Q3 Guidance
      Q: Is Q3 tracking with second-half growth?
      A: Q3 results are expected to mirror second-half growth rates with similar promotional pacing year-over-year.

    10. Promotions Impact
      Q: What learnings emerged from promotions?
      A: Recent promotions delivered robust displays and consumer response, confirming the brand’s fundamentals.

    11. Pricing Increase Rationale
      Q: Why is a price increase planned?
      A: The upcoming Q4 shake price hike is driven by rising costs and competitive actions, aligning with industry trends.

    12. Non-Promoted Growth
      Q: What fuels non-promoted sales acceleration?
      A: Approximately 80% of growth is coming from non-promoted channels, drawing new households into the category.

    13. Consumer Metrics
      Q: What are current penetration and repeat rates?
      A: Premier reached over 18% household penetration with a 50% repeat rate, showcasing strong loyalty.

    14. Consumer Base Expansion
      Q: Is the consumer base broadening?
      A: The brand is successfully attracting a wider age mix while remaining focused on adult nutrition.

    15. Brand Interaction
      Q: Is Premier Powder affecting Dymatize sales?
      A: There’s minimal overlap as each caters to distinct consumer segments, limiting trade-down effects.

    16. Marketing Spend Shift
      Q: Are marketing dollars shifting among brands?
      A: Some marketing funds have been reallocated to support both Premier Powder and Dymatize more efficiently.

    17. Club Promo Competition
      Q: Will competitors mimic club promotions?
      A: Most competitors are already active in club promotions, and similar events are typical industry practice.

    18. E-commerce Competition
      Q: Will e-com discounting persist for Dymatize?
      A: Aggressive e-com discounting is noted now, but it should ease as rising commodity costs influence pricing.

    19. TDP Recovery
      Q: When will temporary out-of-stocks improve?
      A: Improvements in TDPs are expected monthly through Q3, reaching optimal levels in Q4.

    20. Shipments vs Consumption
      Q: Will shipments modestly exceed consumption?
      A: Shipments are projected to slightly outpace consumption as retailers incrementally restock.

    21. Out-of-stock Behavior
      Q: Do customers switch flavors when out-of-stock?
      A: Customers typically choose alternate flavors or pack sizes, maintaining their brand preference.

    22. TDP Shelf Recovery
      Q: What happens to shelf space during shortages?
      A: Temporary shelf gaps occur during TDP shortages, but space is quickly reclaimed without lasting loss.

    23. Aisle Placement Expansion
      Q: Can in-store placements be expanded?
      A: The focus remains on boosting displays, particularly in pharmacy sections, to enhance visibility.

    24. Long-term Display Strategy
      Q: Is external display placement sustainable?
      A: Retailers' strong interest in health and wellness trends supports ongoing external displays.

    25. E-com & In-store Synergy
      Q: Can physical channels boost e-com sales?
      A: Initiatives to integrate in-store promotions and sampling aim to enhance Dymatize’s e-com performance.