Hostess Brands reports strong quarterly growth thanks to Cloverhill acquisition
American snack company, Hostess Brands, reported strong net revenue growth during its third quarter, driven by its acquisition of Cloverhill’s breakfast items earlier this year.
Hostess Brands noted that its net revenue increased 9.7% to $211mn, with around $18.mn coming from the acquisition.
Andy Callaghan, President and Chief Executive Officer of the company, said that the transformation of the Cloverhill business is progressing as planned and that it will be “an important growth contributor in the future".
The snack company said that its point of sales increased 3.8% during the quarter whilst its gross profits were down to 28.6% of net revenue.
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Hostess Brands said it was working to transform the Cloverhill business into a profitable operation by reducing waste and downtime.
“The Hostess team continued to grow our point of sale ahead of the category and further expand our market share this quarter,” noted Callahan.
“We have seen very good point of sale growth within five of our six tracked channels as compared to the prior year.
“We are executing our proven and differentiated model that leverages our strong brands, consumer-relevant innovation and collaborative customer partnerships to drive Hostess share growth and profitable category growth for our customers."