Utz (NYSE:UTZ) Reports Sales Below Analyst Estimates In Q4 Earnings

Utz Brands, Inc. (NYSE:UTZ), a leading manufacturer of branded salty snacks, reported fourth-quarter earnings that fell short of analyst estimates, with sales declining 3% year-over-year to $341.05 million. The company's earnings per share (EPS) of $0.03 also missed the consensus estimate of $0.19. However, excluding one-time items, adjusted EPS came in at $0.22, beating analyst projections.



Utz's sales shortfall was largely driven by the divestment of its R.W. Gracia and Good Health brands to Popchips owner Our Home for $182.5 million in 2024. Despite this, the company's organic sales remained flat year-over-year, indicating that its core business was not negatively affected by the divestment. Utz's Power Brands, such as Utz, On The Border, Zapp's, and Boulder Canyon, continue to perform well and contribute significantly to the company's overall sales.

Utz is guiding for organic sales to rise in the low-single-digit percentage range in 2025, led by strength in its salty snacks segment and a smaller decline among its non-branded and non-salty snacks. The company is also projecting a 10% to 15% increase in adjusted earnings for 2025, which would be about 85 cents to 89 cents per share. Analysts are forecasting 83 cents per share for the new year.

Dean Seal, a reporter for The Wall Street Journal, noted that Utz's strategic divestment of the R.W. Gracia and Good Health brands allowed the company to focus on its core Power and Foundation brands, ultimately leading to a turnaround in its financial performance. The divestment also enabled Utz to swing to a profit in the fourth quarter, with earnings of $2.3 million compared to a loss of $27.7 million in the same quarter a year ago.

In conclusion, while Utz's fourth-quarter sales and EPS fell short of analyst estimates, the company's organic sales remained stable, and its guidance for 2025 indicates a strong outlook for growth. Utz's strategic divestment of underperforming brands has allowed the company to focus on its core strengths and improve its financial performance. As the company continues to invest in its Power Brands and expand into new categories, it is well-positioned to maintain its market leadership in the salty snacks industry.