B&G Foods is positioning for a “transformational year” in the wake of recent acquisitions and disposals as the US group raised guidance across a range of metrics.
While sales, adjusted EBITDA and EPS are expected to be higher in fiscal 2026 than was envisaged in March, the sale of the Green Giant frozen business in the US – its most recent divestment – led to a first-quarter loss.
The group’s $32.5m net loss was mainly driven by $36.3m loss from the sale of assets in connection with that disposal, including $5.8m from impairments related to property, plant and equipment, as well as an increase in acquisition costs.
B&G Foods is going through a business reset following the purchase of the College Inn and Kitchen Basics brands. But it has also offloaded Green Giant frozen in the US on the back of selling its shelf-stable vegetables line in the US to the same buyer – Seneca Foods.
It has also recently offloaded the Le Sueur and Don Pepino businesses, with the combination of disposals leading to a 3.9% decrease in first-quarter sales to $408.9m. However, so-called base sales were up 2.8% at $365.1m.
In balance, president and CEO Casey Keller told analysts yesterday (12 May) that the College Inn and Kitchen Basics deals would “create positive EBITDA and higher margins on our portfolio, replacing the low-margin Green Giant US frozen business with a more profitable and stable broth and stock business”.
He added: “Fiscal year 2026 is poised to be a transformational year with a more focused, higher margin, and stable portfolio once divestitures and post-closing transition services have been completed.”
Finance chief Bruce Wacha said College Inn and Kitchen Basics added around $2.9m to the sales numbers during B&G Foods first week of ownership. The co-manufacturing agreement it entered with Seneca Foods as part of the Green Giant frozen asset sale in the US brought in another $8.5m.
Meanwhile, the sale of the Green Giant frozen and shelf-stable vegetable lines in Canada to Nortera Foods, announced last year, is still in progress.
That deal needs regulatory approval in Canada but is expected to close in the second quarter of the 2026 fiscal year, Keller said as he and his team watch the developments in the Middle East.
B&G Foods new sales guidance has been set at $1.735bn to $1.775bn, compared to the March forecast of $1.655bn to $1.695bn.
Adjusted EBITDA is expected to come in at $275-290m versus $265-275m previously.
The outlook for adjusted diluted EPS was tweaked higher to $0.575 to $0.675, from $0.550 to $0.650.
Wacha said: “Our 2026 guidance reflects what we know today and, for example, does not factor in significant changes in inflation, tariff policies, or the potential impact of escalation in the conflicts in Eastern Europe, the Middle East, or Latin America could have on our results.”