B&G Foods' Q2 2025 Earnings Call: Unraveling Contradictions in Tariffs, Divestitures, and Pricing Strategies

Tariff exposure and recovery, divestiture strategy and timing, pricing strategy and tariff mitigation, inventory management and strategic focus, divestiture strategy and timeline are the key contradictions discussed in B&G Foods' latest 2025Q2 earnings call.



Revenue Decline and Segment Performance:
- B&G Foods reported Q2 net sales of $424.4 million, down 4.5% from the previous year, with base business down 4.2%.
- The decline was primarily due to challenges in the frozen and vegetables business unit and reduced sales in the specialty segment.

Divestiture Strategy and Financial Impact:
- The company completed divestitures of the Don Pepino and Scalfani brands, and the Le Sueur U.S. Canned peas business, impacting $14 million and $36 million in annual net sales, respectively.
- These divestitures align with B&G Foods' strategy to focus the portfolio and reduce leverage, but will also reduce net sales forecasts.

Cost Management and Profitability:
- B&G Foods plans to achieve an additional $10 million in cost savings during the second half of the year, contributing to an annual run rate of $15 million to $20 million.
- This is expected to improve adjusted EBITDA and offset tariff impacts, with the U.S. frozen vegetables business expected to turn profitable.

Tariff Impact and Mitigation Efforts:
- The company is facing tariff impacts, with approximately $1.6 million affecting adjusted EBITDA in Q2, primarily in the Spices and Flavor Solutions business.
- B&G Foods is implementing targeted pricing actions and exploring alternative sourcing for garlic and onion to mitigate tariff effects, with expectations to recover most of the tariff costs by the end of fiscal 2026.