Ready...
2024 Annual Report
BellRing Brands 2024 Annual Report 1
Our flagship brand, Premier Protein, leads the
entire convenient nutrition category, one of the
fastest-growing categories in the retail space.
We have compelling brand and customer
strategies ready to go and we now have enough
shake supply to fuel them. We have leveled up
our systems and processes and we are united
around our purpose, “Changing Lives with Good
Energy”. We know there will be challenges, but
we are energized, stronger than ever and we are
READY FOR MORE.
for MORE
2 BellRing Brands 2024 Annual Report
2020
2021
2022
2023
2024
Net Sales
$ 988.3
$ 1,247.1
$ 1,371.5
$ 1,666.8
$ 1,996.2
Gross Profit
338.0
386.2
421.8
530.2
707.3
Operating Profit
164.0
168.0
212.4
287.3
387.7
Net Earnings Including Redeemable Noncontrolling Interest
100.1
114.4
116.0
165.5
246.5
Net Earnings Available to Common Stockholders
23.5
27.6
82.3
165.5
246.5
Diluted Earnings per Share of Common Stock
$ 0.60
$ 0.70
$ 0.88
$ 1.23
$ 1.86
Operating Cash Flow
97.2
226.1
21.0
215.6
199.6
Adjusted EBITDA(1)
197.2
233.9
271.4
338.3
440.2
Adjusted Net Earnings Available to Common Stockholders(1)
24.3
35.8
108.9
177.2
255.5
Adjusted Diluted Earnings per Share of Common Stock(1)
$ 0.62
$ 0.90
$ 1.16
$ 1.32
$ 1.93
Financial Highlights
(in millions except per share data)
To Our
Stockholders
BellRing Brands has had an incredible five years since
our initial public offering (“IPO”) in October 2019. Our
purpose is to “Change Lives with Good Energy,” and
we have improved millions of people’s lives with our
products. Premier Protein products are now in 1 in 5
households, up from 11% in 2019(2). We more than
doubled our net sales and Adjusted EBITDA(1), starting
from net sales of approximately $850 million in 2019 to
just shy of $2 billion in 2024, with Adjusted EBITDA(1)
growing from $198 million to $440 million. We have
also delivered incredible returns for our stockholders,
with our stock returning 355% since our IPO. And
lastly, we have done all this while strengthening our
Good Energy culture, with our employees voting us a
‘Great Place to Work’ every single year.
What is truly amazing about BellRing Brands…we
are just getting started! During the past two years our
team has been working hard to build out our shake
supply network, build compelling brand strategies,
ready our innovation, and up-level our systems
and processes, and now with full supply, a solid
organizational foundation and amazing growth plans…
we are READY FOR MORE!
We are ready to introduce MORE PEOPLE to
our brands. We are ready to expand our category
and products into MORE PLACES. We are ready
to surprise and delight consumers with MORE
PRODUCTS. We are ready to Change MORE Lives
with Good Energy.
BellRing is a growth company, and we have been
preparing for the moment when our supply would be
unconstrained, and we are ready!
Now to our brands and a brief recap of 2024: Our
flagship brand, Premier Protein, had a pivotal year in
2024. Our shake supply steadily increased throughout
the year and, with net sales growth of 23%, we
demonstrated strong demand is there. The brand
reached new highs across many key metrics, including
market share, household penetration, distribution and
buy rate. Premier Protein remained the #1 brand in
the ready-to-drink (“RTD”) segment, as well as the
#1 brand in the convenient nutrition category (across
tracked channels)(3). The brand added just over
three percentage points of household penetration in
convenient nutrition, reaching 19.4% of households(2).
BellRing Brands 2024 Annual Report 3
8 BellRing Brands 2024 Annual Report
People
Places
Products
Protein
Changing MORE Lives
with Good Energy
MORE opportunities to reach new
MORE growth in new
MORE innovative
MORE healthy
4 BellRing Brands 2024 Annual Report
These successes were achieved without significant
advertising or promotions at many retailers, further
illustrating the brand’s strength and future potential.
Our diversified co-manufacturing network consistently
delivered to expectations in 2024. Our inventory
levels are strong as we enter 2025, and we now have
a scalable, regionally diverse supply chain able to
support our long-term growth projections.
Dymatize, our super-premium sports nutrition brand,
had net sales growth of 6% this year. It remains one
of the strongest brands in the powder category with
household penetration and overall distribution levels
holding steady. Encouragingly, Dymatize’s international
business is strong, posting double-digit net sales
growth in 2024.
We continue to be excited about the expanding
growth potential of the convenient nutrition category,
specifically the segments that we compete in, shakes
and powders. Shakes are the category stand-out,
delivering double-digit growth in each of the last
four years, yet still with low household penetration at
48%(2). Protein continues to have incredible tailwinds
and high relevance with a broad swath of consumers.
It is beneficial for almost every age depending on their
nutrition and health goals. The growing popularity
of functional foods and beverages, continued rise in
healthy convenient foods and interest by GLP-1
weight loss medication users seeking protein to
mitigate muscle loss highlights a long path of future
growth. With our brands’ mainstream appeal and
great-tasing, high-protein products, we are well
positioned for many years.
Over the past couple of years, we have developed
an Environmental, Social, and Governance (“ESG”)
platform that has guided us in prioritizing focus
areas. In 2024, we continued building on those efforts
and made additional progress toward understanding
and reducing our impact on packaging, greenhouse
gas emissions and our agricultural supply chain.
Household Penetration(2)
21%
Brand I Love in RTD
Shakes(4)
#1
RTD Market Share(3)
23%
Premier Protein
Dymatize
Hydrolyzed Protein
Powder(3)
#1
TikTok Likes(5)
1.2
MORE
products
people
love
Whey Protein Powder
at Leading E-tailer(6)
#2
These achievements required cross-functional
cooperation and demonstrated a shared commitment
toward our ESG priorities across the business.
We seek further advancements within our ESG focus
areas in the years to come.
Financially, 2024 was another record year for both net
sales and Adjusted EBITDA(1), with respective growth
over 2023 of 20% and 30%. Since our IPO, we have
delivered an 18% revenue CAGR and a 17% Adjusted
EBITDA CAGR, outperforming our long-term algorithm
of 10-12% revenue growth with 18-20% Adjusted
EBITDA margins. We are proud of our performance
and plan to continue to aggressively drive growth.
From a stockholder standpoint, your stock appreciated
47% in 2024. Our strong net sales growth generated
$200 million in cash flow from operations this year.
We used $147 million of this cash flow to repurchase
2.6 million shares of our common stock and $25 million
to reduce debt.
M
BellRing Brands 2024 Annual Report 5
#1
Ready-to-
drink shake
brand
(3)
Darcy H. Davenport
President and Chief Executive Officer
RTD and Powders Category(3)
We are ready to expand into more
places, with share of shelf our
biggest opportunity.
Category Sales
Generated
Share of Shelf
Space
~18%
~8%
RTD Shakes Household Penetration(2)
Premier
Protein RTD
RTD Shake
Category
Convenient
Nutrition
Category
Our increase in supply has
us ready to expand into more
households to reach more
people.
18.5%
48%
76%
MORE
people
and
places
In closing, our momentum remains high. We have
had a strong five years since our IPO and are in
an excellent position to continue to drive growth.
The convenient nutrition category continues to
provide strong tailwinds, and RTD shakes and
powders have tremendous upside. Premier Protein
and Dymatize are leading mainstream brands that
deeply resonate with consumers. We have developed
delicious new products with a promising pipeline of
innovation to bring excitement to consumers and our
retail partners. We are a rare combination of scale,
organic growth, strong margins and high free cash
flow generation. Lastly, our unique culture continues
to fuel our success.
We remain confident in the long-term outlook
for BellRing and look forward to a strong 2025.
We are READY FOR MORE!
Thank you for your continued support.
BellRing Brands 2024 Annual Report 7
Robert V. Vitale
Chairman of the Board
We are
just getting
started!
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended September 30, 2024
OR
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number: 1-39093
BellRing Brands, Inc.
(Exact name of registrant as specified in its charter)
Delaware
87-3296749
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
2503 S. Hanley Road St. Louis, Missouri 63144
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code: (314) 644-7600
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, $0.01 par value
BRBR
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒ No ☐
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405
of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit
such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or
an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth
company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
☒
Accelerated filer
☐
Non-accelerated filer
☐
Smaller reporting company
☐
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any
new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal
control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that
prepared or issued its audit report. ☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in
the filing reflect the correction of an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation
received by any of the registrant’s executive officers during the relevant period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
The aggregate market value of the registrant’s Common Stock held by non-affiliates of the registrant as of March 29, 2024, the last business day of
the registrant’s most recently completed second fiscal quarter, was $7,664,440,784.
Number of shares of Common Stock, $0.01 par value, outstanding as of November 12, 2024: 128,782,398
DOCUMENTS INCORPORATED BY REFERENCE
Certain portions of the registrant’s definitive proxy statement for its 2025 annual meeting of stockholders, to be filed with the Securities and
Exchange Commission within 120 days after September 30, 2024, are incorporated by reference into Part III of this report.
i
TABLE OF CONTENTS
Cautionary Statement on Forward-Looking Statements
1
Summary of Risk Factors
3
PART I
Item 1.
Business
5
Item 1A.
Risk Factors
13
Item 1B.
Unresolved Staff Comments
29
Item 1C.
Cybersecurity
29
Item 2.
Properties
31
Item 3.
Legal Proceedings
31
Item 4.
Mine Safety Disclosures
31
PART II
Item 5.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
Securities
32
Item 6.
[Reserved]
33
Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
34
Item 7A.
Quantitative and Qualitative Disclosures About Market Risk
40
Item 8.
Financial Statements and Supplementary Data
41
Item 9.
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
67
Item 9A.
Controls and Procedures
67
Item 9B.
Other Information
67
Item 9C.
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
68
PART III
Item 10.
Directors, Executive Officers and Corporate Governance
69
Item 11.
Executive Compensation
69
Item 12.
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
69
Item 13.
Certain Relationships and Related Transactions, and Director Independence
69
Item 14.
Principal Accountant Fees and Services
69
PART IV
Item 15.
Exhibits and Financial Statement Schedules
70
Item 16.
Form 10-K Summary
73
Signatures
74
1
CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS
Forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), are made throughout this report,
including statements regarding unanticipated developments that negatively impact our common stock. These forward-looking
statements are sometimes identified from the use of forward-looking words such as “believe,” “should,” “could,” “potential,”
“continue,” “expect,” “project,” “estimate,” “predict,” “anticipate,” “aim,” “intend,” “plan,” “forecast,” “target,” “is likely,”
“will,” “can,” “may” or “would” or the negative of these terms or similar expressions elsewhere in this report. Our financial
condition, results of operations and cash flows may differ materially from those in the forward-looking statements. Such
statements are based on management’s current views and assumptions and involve risks and uncertainties that could affect
expected results. Those risks and uncertainties include, but are not limited to, the following:
•
our dependence on sales from our ready-to-drink (“RTD”) protein shakes;
•
our ability to continue to compete in our product categories and our ability to retain our market position and favorable
perceptions of our brands;
•
disruptions or inefficiencies in our supply chain, including as a result of our reliance on third-party suppliers or
manufacturers for the manufacturing of many of our products, pandemics and other outbreaks of contagious diseases,
labor shortages, fires and evacuations related thereto, changes in weather conditions, natural disasters, agricultural
diseases and pests and other events beyond our control;
•
our dependence on third-party contract manufacturers for the manufacture of most of our products, including one
manufacturer for nearly half of our RTD protein shakes;
•
the ability of our third-party contract manufacturers to produce an amount of our products that enables us to meet
customer and consumer demand for the products;
•
our reliance on a limited number of third-party suppliers to provide certain ingredients and packaging;
•
significant volatility in the cost or availability of inputs to our business (including freight, raw materials, packaging,
energy, labor and other supplies);
•
our ability to anticipate and respond to changes in consumer and customer preferences and behaviors and introduce
new products;
•
consolidation in our distribution channels;
•
our ability to expand existing market penetration and enter into new markets;
•
the loss of, a significant reduction of purchases by or the bankruptcy of a major customer;
•
legal and regulatory factors, such as compliance with existing laws and regulations, as well as new laws and
regulations and changes to existing laws and regulations and interpretations thereof, affecting our business, including
current and future laws and regulations regarding food safety, advertising, labeling, tax matters and environmental
matters;
•
fluctuations in our business due to changes in our promotional activities and seasonality;
•
our ability to maintain the net selling prices of our products and manage promotional activities with respect to our
products;
•
ability to obtain additional financing (including both secured and unsecured debt) and our ability to service our
outstanding debt (including covenants that restrict the operation of our business);
•
the accuracy of our market data and attributes and related information;
•
changes in critical accounting estimates;
•
uncertain or unfavorable economic conditions that limit customer and consumer demand for our products or increase
our costs;
•
risks related to our ongoing relationship with Post Holdings, Inc. (“Post”) following our separation from Post and
Post’s distribution of our stock to its shareholders (the “Spin-off”), including our obligations under various agreements
with Post;
•
conflicting interests or the appearance of conflicting interests resulting from certain of our directors also serving as
officers or directors of Post;
2
•
risks related to the previously completed Spin-off;
•
the ultimate impact litigation or other regulatory matters may have on us;
•
risks associated with our international business;
•
our ability to protect our intellectual property and other assets and to continue to use third-party intellectual property
subject to intellectual property licenses;
•
costs, business disruptions and reputational damage associated with technology failures, cybersecurity incidents and
corruption of our data privacy protections;
•
impairment in the carrying value of goodwill or other intangible assets;
•
our ability to identify, complete and integrate or otherwise effectively execute acquisitions or other strategic
transactions and effectively manage our growth;
•
our ability to hire and retain talented personnel, employee absenteeism, labor strikes, work stoppages or unionization
efforts;
•
our ability to satisfy the requirements of Section 404 of the Sarbanes-Oxley Act of 2002;
•
significant differences in our actual operating results from any guidance we may give regarding our performance; and
•
other risks and uncertainties included under “Risk Factors” in Item 1A of this report.
You should not rely upon forward-looking statements as predictions of future events. Although we believe that the
expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of
activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur.
Moreover, we undertake no obligation to update publicly any forward-looking statements for any reason after the date of this
report to conform these statements to actual results or to changes in our expectations.
3
SUMMARY OF RISK FACTORS
We are subject to a variety of risks and uncertainties, including industry and operating risks, financial and economic risks,
legal and regulatory risks, risks related to our relationship with Post, risks related to ownership of our Common Stock and
certain general risks, which could have a material adverse effect on our business, financial condition, results of operation and
cash flows. Risks that we deem material are described in Item 1A, “Risk Factors” of this report. These risks include, but are not
limited to, the following:
•
A substantial amount of our net sales comes from our RTD protein shakes, and a decrease in sales of our RTD protein
shakes would adversely affect our business, financial condition, results of operations and cash flows.
•
We operate in a category with strong competition.
•
Disruption of our supply chain and changes in weather conditions could have an adverse effect on our business,
financial condition, results of operations and cash flows.
•
We are dependent on third-party contract manufacturers for the manufacture of most of our products, including one
manufacturer for nearly half of our RTD protein shakes. Our business could suffer if we do not continue to contract
with key third-party manufacturers or as a result of a third-party contract manufacturer’s inability to produce our
products for us in the quantities required, on time or to our specifications.
•
Our reliance on a limited number of suppliers for certain equipment, ingredients and packaging materials, the price and
availability of ingredients and packaging materials, higher freight costs and higher energy costs could negatively
impact our business, financial condition, results of operations and cash flows.
•
We must identify changing consumer and customer preferences and behaviors and develop and offer products to meet
these preferences.
•
Our results may be adversely impacted if consumers do not maintain favorable perceptions of our brands.
•
Uncertain or unfavorable economic conditions, including during periods of high inflation, could limit consumer and
customer demand for our products, increase our costs or otherwise adversely affect us.
•
Consolidation in our distribution channels, and competitive, economic and other pressures facing our customers, may
hurt our profit margins.
•
Our sales and profit growth are dependent upon our ability to expand existing market penetration and enter into new
markets.
•
Loss of, a significant reduction of purchases by or bankruptcy of a major customer may adversely affect our business,
financial condition, results of operations and cash flows.
•
Violations of laws or regulations by us or our third-party contract manufacturers, as well as new laws or regulations or
changes to existing laws or regulations, could adversely affect our business.
•
Fluctuations in our business due to changes in our promotional activities and seasonality may have an adverse impact
on our financial condition, results of operations and cash flows.
•
We have substantial debt, which could have a negative impact on our financing options and liquidity position and
could adversely affect our business.
•
Our borrowing costs and access to capital and credit markets could be adversely affected by a downgrade or potential
downgrade of our credit ratings.
•
United States and global capital and credit market issues, including those that have arisen as a result of heightened
inflation, could negatively affect our liquidity, increase our costs of borrowing and disrupt the operations of our
suppliers and customers.
•
We have overlapping directors and management with Post, which may lead to conflicting interests or the appearance of
conflicting interests.
•
Our certificate of incorporation and bylaws and provisions of Delaware law may discourage or prevent strategic
transactions, including a takeover of us, even if such transaction would be beneficial to our stockholders.
•
We may be responsible for U.S. federal tax liabilities that relate to the Spin-off.
•
If all or a portion of the Spin-off does not qualify as a tax-free transaction for any reason, including because any of the
factual statements or representations in the legal opinions are incomplete or untrue, Post may recognize a substantial
4
gain for U.S. federal income tax purposes, and we may incur indemnification or other liabilities to Post as a result.
•
Pending and future litigation and claims may impair our reputation or lead us to incur significant costs.
•
Our international operations subject us to additional risks.
•
Our intellectual property rights are valuable and any inability to protect them, or termination of our material
intellectual property licenses, could reduce the value of our products and brands and have a material adverse effect on
our business.
•
Technology failures, cybersecurity incidents and corruption of our data privacy protections could disrupt our
operations and negatively impact our business.
•
Impairment in the carrying value of intangible assets could negatively impact our financial condition and results of
operations. If our goodwill or other intangible assets become impaired, we will be required to record impairment
charges, which may be significant.
•
If we pursue acquisitions or other strategic transactions, we may not be able to successfully consummate favorable
transactions or successfully integrate acquired businesses.
•
Actual operating results may differ significantly from our guidance and our forward-looking statements.
•
We may not be able to operate successfully if we are unable to recruit, hire, retain and develop key personnel and a
qualified and diverse workforce. In addition, temporary workforce disruptions or the inability of our employees to
safely perform their jobs for any reason, including as a result of illness could adversely impact our business, financial
condition, results of operations and cash flows.
Additional risks and uncertainties not presently known to us or that we currently deem immaterial also may impair our
business, financial condition, results of operations and cash flows.
5
PART I
ITEM 1.
BUSINESS
General
BellRing Brands, Inc. (formerly known as BellRing Distribution, LLC) (“BellRing”) was formed in the State of Delaware
on October 20, 2021 as a wholly-owned subsidiary of Post Holdings, Inc. (“Post”) for the purpose of effecting the separation of
BellRing Intermediate Holdings, Inc. (formerly known as BellRing Brands, Inc.) (“Old BellRing”) from Post. Under a
transaction agreement and plan of merger (the “Transaction Agreement”) that we entered into on October 26, 2021 and
amended as of February 28, 2022, with Post, Old BellRing and our subsidiary BellRing Merger Sub Corporation (“Merger
Sub”), Post distributed approximately 80.1% of its interest in us to Post’s shareholders and Merger Sub merged with and into
Old BellRing, with Old BellRing surviving and becoming our subsidiary. On March 10, 2022, as a result of the completion of
the transactions provided for under the Transaction Agreement (including the “Separation” and “Distribution”, each defined
below), we became a new public holding company and the successor registrant to Old BellRing. In this report, we refer to the
transactions undertaken pursuant to the Transaction Agreement as the “Spin-off.” The Spin-off is described in more detail
below.
Our Company
We are a leader in the global convenient nutrition category, aiming to enhance the lives of our consumers by providing
them with nutritious, great-tasting products they can enjoy throughout the day. Our primary brands, Premier Protein and
Dymatize, target a broad range of consumers and compete in all major product forms, including ready-to-drink (“RTD”) protein
shakes and powders. Our products are distributed across a diverse network of channels including club, food, drug and mass
(“FDM”), eCommerce, specialty and convenience.
We have organically grown our net sales from $1,371.5 million in our year ended September 30, 2022 to $1,996.2 million
in our year ended September 30, 2024. Over the same period, net earnings including redeemable noncontrolling interest
increased from $116.0 million in our year ended September 30, 2022 to $246.5 million in our year ended September 30, 2024.
The Spin-off
Pursuant to the Transaction Agreement and in connection with a series of corporate separation transactions, on March 9,
2022, Post contributed to us (i) all of its nonvoting common units of BellRing Brands, LLC (“BellRing LLC”) and its sole
outstanding share of Old BellRing’s Class B common stock, $0.01 par value per share (the “Old BellRing Class B Common
Stock” and with Old BellRing’s Class A common stock, $0.01 par value per share (the “Old BellRing Class A Common
Stock”), collectively, the “Old BellRing Common Stock”)) and (ii) $550.4 million in cash, in exchange for Post’s right to
receive $840.0 million in aggregate principal amount of our 7.00% Senior Notes due 2030 and limited liability company
interests in us (prior to our conversion to a Delaware corporation, as described below).
On March 10, 2022, we converted into a Delaware corporation and changed our name to “BellRing Brands, Inc.”, and Post
distributed an aggregate of 78.1 million, or 80.1%, of its shares of our common stock, $0.01 par value per share (the “BellRing
Common Stock”) to its shareholders in a pro-rata distribution (the “Distribution”). Post shareholders received 1.267788 shares
of BellRing Common Stock for every one share of Post common stock held as of the record date for the Distribution. No
fractional shares of BellRing Common Stock were issued, and instead, cash in lieu of any fractional shares was paid to Post
shareholders.
Also on March 10, 2022, upon completion of the Distribution, Merger Sub merged with and into Old BellRing (the
“Merger”), with Old BellRing continuing as the surviving corporation and becoming our wholly-owned subsidiary. Under the
Merger, each outstanding share of Old BellRing Class A Common Stock was converted into one share of BellRing Common
Stock and $2.97 in cash, resulting in $115.5 million in total consideration paid to Old BellRing Class A common stockholders
pursuant to the Merger.
As a result of the Spin-off, we became the new public parent company of, and successor issuer to, Old BellRing, and shares
of our BellRing Common Stock were deemed to be registered under Section 12(b) of the Exchange Act, pursuant to Rule 12g-
3(a) promulgated thereunder.
Immediately following the Spin-off, Post owned approximately 14.2% of BellRing Common Stock and the former holders
of Old BellRing Class A Common Stock owned approximately 28.5% of BellRing Common Stock. As a result of the Spin-off,
the dual class voting structure of Old BellRing was eliminated. As of both September 30, 2024 and 2023, Post had no
ownership of BellRing Common Stock.
Unless otherwise indicated or the context otherwise requires, all references in this report to “BellRing,” “we,” “our,” “us,”
“the Company” and “our Company” refer to (1) Old BellRing and its consolidated subsidiaries during the periods prior to the
6
completion of the Spin-off, including BellRing LLC, Premier Nutrition Company, LLC (“Premier Nutrition”), Dymatize
Enterprises, LLC (“Dymatize”), Supreme Protein, LLC (“Supreme Protein”), the PowerBar brand and Active Nutrition
International GmbH (“Active Nutrition International”) and (2) us and our consolidated subsidiaries during the periods
subsequent to the Spin-off, including, BellRing LLC, Premier Nutrition, Dymatize, Supreme Protein, Active Nutrition
International and Premier Nutrition Canada, Inc., in each case, unless otherwise stated or the context otherwise indicates.
Our History prior to the Spin-off
Prior to completion of the Spin-off, and subsequent to Old BellRing’s initial public offering (the “Old BellRing IPO”),
which was completed in October 2019, our subsidiary BellRing LLC was the holder of Post’s active nutrition business, which
had been comprised of Premier Nutrition, Dymatize, the PowerBar brand and Active Nutrition International. The members of
BellRing LLC were Post and Old BellRing. Old BellRing held the voting membership unit of BellRing LLC (which represented
the power to appoint and remove the members of the board of managers of BellRing LLC and no economic interest). Post held
one share of the Old BellRing Class B Common Stock, which represented 67% of the voting power of the common stock of Old
BellRing, with the holders of Old BellRing Class A Common Stock holding 33% of the voting power. Immediately prior to
completion of the Spin-off, Post owned 71.5% of the economic interests in BellRing LLC, and Old BellRing (and, indirectly,
the holders of the Old BellRing Class A Common Stock) owned 28.5% of the economic interests in BellRing LLC. Old
BellRing, as a holding company, had no material assets other than its ownership of BellRing LLC units and its indirect interests
in the subsidiaries of BellRing LLC.
Post had acquired the businesses that comprised its active nutrition business in a series of transactions during 2013, 2014
and 2015. In its fiscal year ended September 30, 2013, Post acquired Premier Nutrition Corporation, which, at the time, was a
marketer and distributor of high-quality protein shakes and nutrition bars under the Premier Protein brand and nutritional
supplements under the Joint Juice brand. Effective September 30, 2019, Premier Nutrition Corporation converted to a limited
liability company and changed its corporate name to Premier Nutrition Company, LLC.
In its fiscal year ended September 30, 2014, Post acquired Dymatize, which, at the time, was a manufacturer and marketer
of high-quality protein powders and nutritional supplements under the Dymatize brand and nutrition bars under the Supreme
Protein brand.
In its fiscal year ended September 30, 2015, Post acquired the PowerBar brand and Active Nutrition International (then
known as Powerbar Europe GmbH). The PowerBar brand was founded in 1986.
Our Organizational Structure
As a result of the Spin-off:
•
We became the new public parent company of, and successor issuer to, Old BellRing, and shares of our BellRing
Common Stock were deemed to be registered under Section 12(b) of the Exchange Act, pursuant to Rule 12g-3(a)
promulgated thereunder.
•
Old BellRing is our wholly-owned subsidiary.
•
All of our membership interests in BellRing LLC were contributed to Old BellRing and Old BellRing is the sole equity
member of BellRing LLC.
Immediately following the Spin-off, Post owned 19,397,339 shares, or approximately 14.2%, of BellRing Common Stock.
On August 11, 2022, Post disposed of 14,800,000 shares of BellRing Common Stock, and on November 25, 2022, Post
disposed of its remaining 4,597,339 shares of BellRing Common Stock. Post had no ownership of BellRing Common Stock as
of September 30, 2024 or 2023.
See “Risk Factors” included in Item 1A of this report and Notes 1 and 13 within “Notes to Consolidated Financial
Statements” included in Item 8 of this report for more information about the Spin-off.
Our Industry
We operate in the global convenient nutrition category, a rapidly-growing and on-trend category within the food and
beverage industry. The U.S. is our primary market and is the largest and most developed market in the world for our category.
We believe the U.S. convenient nutrition category can be broken down into four key consumer need states as defined by our
management: everyday nutrition, adult nutrition, sports nutrition and weight management.
While we believe most brands in the convenient nutrition category are positioned to appeal to consumers primarily in one
need state, Premier Protein has developed brand equities and product value propositions to appeal to a broad range of consumer
need states. We primarily compete in the everyday nutrition and sports nutrition consumer need states, but also appeal to the
adult nutrition and weight management consumer need states. We define everyday nutrition as nutritious products that can be
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consumed throughout the day as part of a healthy lifestyle. Our Dymatize brand is focused primarily on sports nutrition, which
we define as consumers looking to supplement sports endurance and body building needs.
Brand Overview
Our primary brands, based on fiscal 2024 sales, are Premier Protein and Dymatize. Together our brands cover the major
product forms in the convenient nutrition category and appeal to a broad range of consumer need states. Our percentage of net
sales by brand for our year ended September 30, 2024 were as follows: Premier Protein, 85.4%; Dymatize, 12.4%; and other,
2.2%.
Two product forms accounted for the substantial majority of our fiscal 2024 net sales. In our year ended September 30,
2024, RTD protein shakes were 81.1% of our net sales, and powders were 16.4% of our net sales.
Premier Protein
Our largest brand, Premier Protein, is a leading mainstream, lifestyle brand. Premier Protein’s product portfolio consists
primarily of RTD protein shakes and protein powders. Premier Protein’s flagship RTD protein shakes are available in diverse
flavors and contain 30 grams of protein and 160 calories. They are gluten- and soy-free, low in sugar and fat and fortified with
vitamins and minerals. Our RTD protein shakes are formulated to deliver great-tasting, leading protein levels while maintaining
one of the leanest nutritional profiles in the category (as measured by sugar and calorie content). Premier Protein’s powder
portfolio consists primarily of 100% whey protein products. We believe the product profile appeals to consumers across age
ranges in all four need states.
Dymatize
Our Dymatize brand is a market leader targeting fitness enthusiasts who value the brand for its science-based product
development, athletic performance focus and great taste. The brand’s portfolio includes an assortment of sports nutrition
products, including protein powders. The majority of Dymatize’s sales are generated through protein powders. Our protein
powder portfolio consists of three primary products: ISO.100 made with hydrolyzed 100% Whey Protein Isolate, Elite 100%
Whey and Super Mass Gainer. ISO.100, the brand’s flagship product, has a global reach with sales in more than seventy-five
countries. In addition to ISO.100, Dymatize offers a suite of products to meet the needs of athletes.
Our Customers
Our customers are predominantly club stores, FDM retailers, online retailers, specialty retailers, convenience stores and
distributors. We sell our products domestically and in more than ninety countries globally. Our U.S. business represented 89.2%
of our net sales in our year ended September 30, 2024, and our international business represented 10.8% of our net sales in our
year ended September 30, 2024.
Our largest customers, Walmart (which includes its affiliates, including Sam’s Club), Costco and Amazon, accounted for
approximately 74.8% of our net sales in our year ended September 30, 2024. No other customer accounted for more than 10%
of our fiscal 2024 net sales.
Sales, Marketing and Distribution
In the U.S., we utilize a direct sales force in multiple channels, including club, FDM, convenience, specialty and
eCommerce. We also sell through a broker network for customers in the convenience, grocery and mass channels, and through
distributors for the specialty channel. In international markets, we sell our products through a combination of direct sales to
retailers and to third-party distributors. We utilize a direct sales force in key markets in Western Europe for multiple channels,
including specialty, FDM and eCommerce. We also sell through distributors in the specialty channel.
We maintain a dedicated multi-faceted and consumer-driven marketing strategy for each of our primary brands, tailoring
initiatives to each brand’s target audience. Each of our brands maintains a presence across all major social media platforms.
Premier Protein. Premier Protein’s marketing strategy is aimed at accelerating the brand’s positioning as a lifestyle brand
for mainstream consumers. Premier Protein’s marketing initiatives are focused on increasing awareness to drive product trial
and adoption as well as expanding household penetration among this group of consumers. Premier Protein employs a broad
media strategy, which includes digital media, search marketing, television, in-store marketing and demos and online dedicated
programming. As part of its marketing strategy, Premier Protein leverages its fans’ enthusiasm for the brand to spread the word
of our products. The brand utilizes an influencer marketing program called “Premier Shakers” that leverages micro-influencers,
content creators and top-tier influencers to generate further awareness of Premier Protein.
Dymatize. Dymatize’s marketing strategy is focused on retailer-specific programs, online and specialty print media and
social media. Social media is a high-touch medium that resonates with Dymatize’s core fitness-focused consumers. The brand
also utilizes a social media influencer model, the “Squad,” engaging with athletes. This team promotes product usage via
personal social media channels to drive awareness for the brand among its target demographic.
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Our products are distributed through a network of third-party common carriers.
Research and Development
We continue to improve and expand our product offerings with new flavors, ingredients, packaging, product forms and
process development technologies. We leverage our dedicated market research, consumer insights and innovation teams,
supplemented by leading design firms, product development companies, third-party flavor houses and consultants.
Supply Chain
Raw Materials. Raw materials used in our business consist of ingredients and packaging materials purchased from local,
regional and international suppliers. Our principal ingredients include milk-based, whey-based and soy-based proteins, protein
blends, sweeteners and vitamin and mineral blends. Our primary packaging materials include aseptic foil and plastic lined
cardboard cartons, flexible and rigid plastic film and containers, beverage packaging and corrugate. We purchase our raw
materials in accordance with rigorous standards to assure food quality and safety. Supply availability and prices paid for raw
materials can fluctuate widely due to external factors, such as economic climate, commodity market prices, pandemics and
other outbreaks of contagious diseases, weather conditions, labor disputes, governmental programs, regulations and trade and
tariff policies, industry consolidation, energy shortages, transportation delays, currency fluctuations and other unforeseen
circumstances. During fiscal 2024, inflationary pressures on protein costs eased while other costs, such as packaging and
manufacturing, continued to face inflationary pressures. We continuously monitor supply and cost trends of these raw materials
to enable us to obtain ingredients and packaging needed for our products.
Under the terms of an agreement with a significant protein powder supplier, Premier Nutrition is required to purchase a
minimum periodic volume of protein powder and has the right (but not the obligation) to order quantities in excess of such
minimum amount provided the supplier has the capacity and the ability to produce such additional quantities. The agreement
also contains detailed provisions regarding the product specifications and quality standards for the raw materials to be provided
by the supplier, the rights of a party in the event the other party does not comply with its obligations under the agreement and
other customary contractual terms and conditions. The agreement expires on June 30, 2028.
Energy. Electricity and steam are used in the facilities that manufacture our products. In addition, considerable amounts of
diesel fuel are used in connection with the distribution of our products.
Manufacturing. We primarily engage third-party contract manufacturers in North America and the European Union (the
“E.U.”). to produce our products. We receive products from our third-party contract manufacturers for an agreed-upon tolling
charge for each item produced as well as other minor costs. Most of our relationships with our contract manufacturing partners
include minimum volume commitments, whereby the third-party contract manufacturer has committed to produce, and we have
committed to purchase, a minimum quantity of product. We own a manufacturing plant in Voerde, Germany that supplies
nutrition bars and gels primarily for the E.U., Switzerland and the United Kingdom (the “U.K.”).
We regularly monitor the capacity and performance of our third-party contract manufacturing partners and suppliers and
qualify new contract manufacturing partners and suppliers as needed. Given the growth profile of our primary products, we
continuously plan for incremental capacity, including adding a new third-party contract manufacturing partner in fiscal 2024
and expanding production with our existing third-party contract manufacturing partners, and review additional strategic
alternatives to support our business.
From three separate and geographically diverse manufacturing locations, our largest third-party contract manufacturer
provided approximately 47.7% of our Premier Protein RTD shake supply for our year ended September 30, 2024. Under the
terms of a manufacturing agreement with the third-party contract manufacturer, Premier Nutrition is required to purchase a
minimum quarterly order volume of RTD protein shakes and has the right (but not the obligation) to order quantities in excess
of a monthly minimum amount provided the third-party contract manufacturer has the capacity and the ability to produce such
additional quantities. In addition, under the terms of the manufacturing agreement, the third-party contract manufacturer has
committed to produce a quarterly minimum volume of RTD protein shakes. The manufacturing agreement also contains
detailed provisions regarding the product specifications and quality standards for the products to be manufactured and packaged
by the third-party contract manufacturer, the tolling charges for each item produced (and certain other costs) to be paid by
Premier Nutrition (and related payment terms), shipping and storage obligations, the rights of a party in the event the other
party does not comply with its obligations under the manufacturing agreement and other customary contractual terms and
conditions. This agreement expires on December 31, 2027.
We regularly evaluate our contract manufacturing arrangements to ensure the cost-effective manufacturing of our products.
We select our manufacturing partners based on expertise, quality, cost and location. Our quality assurance team frequently
monitors manufacturing partners to ensure our partners meet our rigorous processing and quality standards, detailed in our
Quality Expectations Manual, including requirements for third-party certification of Good Manufacturing Practices. Our owned
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production plant in Voerde, Germany is additionally certified to one of the international Food Safety Standards (FSSC 22.000,
IFS or BRC), SMETA 4-pillars (Labour, Environment, Health and Safety, Business Ethics) and ISO 45001 (Health and Safety).
Distribution. In North America, our products typically are shipped directly from our contract manufacturing partners to a
network of third-party warehouses. Products are distributed from third-party warehouses to customer distribution centers or
retail stores or are exported by our distribution partners to international customers. Occasionally, we ship products directly from
our third-party contract manufacturers to our customers’ distribution centers.
We maintain one third-party warehouse location in Germany, which receives products from our production facility located
in Voerde, Germany or directly from our third-party contract manufacturers. Our branded products are distributed from third-
party warehouses to customer distribution centers or retail stores or are exported to international customers.
Competition
The convenient nutrition category in which we operate is highly competitive and highly sensitive to both pricing and
promotion. We compete with other brands, including private label and store brand products, and with many nutritional food and
beverage players. We have numerous competitors of varying sizes, including manufacturers of other branded food and beverage
products, as well as manufacturers of private label products. Some of our competitors have substantially more financial,
marketing and other resources than us. Competition in our industry is based on, among other things, product quality, taste,
functional benefits, nutritional value and ingredients, convenience, brand loyalty and positioning, product variety, product
packaging, shelf space, price, promotional activities and the ability to identify and satisfy dynamic, emerging consumer
preferences. Our principal strategies for competing in our industry include strong and impactful marketing to build awareness
of our products, effective customer relationship management, category insights, superior product quality and food safety,
product innovation, an efficient supply chain and competitive pricing. We expect the industry we operate in to remain highly
competitive for the foreseeable future.
Seasonality
We experience seasonal fluctuations in our net sales and earnings before interest and taxes (“EBIT”) because of consumer
spending patterns and timing of our key retailers’ promotional activity. Historically, our first fiscal quarter is seasonally low for
net sales for all brands driven by a slowdown of consumption of our products during the holiday season. Sales are typically
higher throughout the remainder of the fiscal year as a result of stronger consumer demand in the second quarter of our fiscal
year, promotional activity at key retailers and organic growth of the business. Seasonal fluctuations in our net sales and EBIT
may not be the same in the future as they have been historically.
Trademarks and Intellectual Property
We own or have licenses to use a number of trademarks that are critical to the success of our business. Our key trademarks
include BellRing®, BellRing Brands®, Premier Protein®, Premier Nutrition®, Dymatize®, ISO.100® and PowerBar®, each
of which we own, as well as trademarks that we license from third parties, such as Pebbles® and Dunkin®. Our owned
trademarks are, in most cases, protected through registration in the U.S. or Germany, as well as in many other countries where
the related brands or products are sold. We also own, or have applications pending, for several patents in the U.S. and other
countries. While our patent portfolio as a whole is material to our business, no one patent or group of related patents is material
to our business. In addition, we have copyrights, proprietary trade secrets, technology, know-how processes and other
intellectual property rights that are not registered.
We rely on a combination of trademark law, copyright law, trade secrets, non-disclosure and confidentiality agreements and
provisions in agreements and other measures to establish and protect our proprietary rights to our products, packaging,
processes and intellectual property.
Governmental Regulation and Environmental Matters
We are subject to regulation by federal, state and local governmental entities and agencies in the U.S., as well as similar
regulations in Canada, Mexico, Europe and other international locations, including food safety laws, labor and employment
laws, laws governing advertising, privacy laws, consumer protection regulations, worker health and safety regulations,
environmental laws and regulations and other laws and regulations.
Our products are regulated in the U.S. either as food or dietary supplements, which internationally may be regulated as
pharmaceuticals or other health food categories. As a producer and distributor of goods for human consumption, we must
comply with stringent production, storage, recordkeeping, distribution, labeling and marketing standards established by the
Food and Drug Administration (the “FDA”), the U.S. Department of Agriculture (the “USDA”), the Federal Trade Commission
and state and local agencies in the U.S. We also must comply with standards established by similar regulatory agencies in
Canada, Mexico, the E.U. and elsewhere. In addition, some of our products are produced and marketed under contract as part of
special certification programs such as organic, kosher or non-GMO, and must comply with the strict standards of federal, state
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and third-party certifying organizations. Products that do not meet regulatory or third-party standards may be considered
adulterated or misbranded and subject to withdrawal or recall. Additionally, following the adoption of the Food Safety
Modernization Act in the U.S. and the Safe Foods for Canadians Act in Canada, the FDA and the Canadian Food Inspection
Agency are implementing additional regulations focused on prevention of food contamination, more frequent inspection of
high-risk facilities, increased record-keeping and improved tracing of food.
Our manufacturing facility in Germany is subject to certain safety regulations, including the German Occupational Safety
and Health Regulation. These regulations require us to comply with certain manufacturing safety standards to protect our
employees from accidents. Additionally, some of the food commodities on which our business relies are subject to
governmental agricultural programs (e.g., subsidies and import/export regulations), which have substantial effects on the prices
and supplies of these commodities.
In addition, our operations are subject to various federal, state and foreign laws and regulations regarding data privacy, data
protection and data security, including the General Data Protection Regulation, the E.U.’s retained law version of the General
Data Protection Regulation, the E.U.-U.S. Data Privacy Framework and the California Consumer Privacy Act, as amended by
the California Privacy Rights Act, each of which applies to certain aspects of our business and regulate how businesses collect,
use and protect personal information obtained from data subjects. As a company with international operations, we also are
subject to laws, rules and regulations in the U.S. and other countries related to anti-corruption, antitrust and competition and
economic sanctions.
Our business also is subject to various federal, state and local laws and regulations with respect to environmental matters,
including air quality, wastewater and storm water management, waste handling and disposal and other regulations intended to
protect public health and the environment. In the U.S., the laws and regulations include the Clean Air Act, the Clean Water Act,
the Resource Conservation and Recovery Act and the California Safe Drinking Water and Toxic Enforcement Act (“Proposition
65”), among others. Internationally, our operations, including our manufacturing facility in Germany, are subject to local and
national regulations similar to those applicable to us in the U.S. We have made, and will continue to make, expenditures to
ensure compliance with environmental regulations.
Human Capital
We have approximately 485 employees as of November 1, 2024. Of these employees, approximately 315 are in the U.S.,
approximately 160 are in Germany and approximately 10 are in other countries. Our people are critical to our success and we
prioritize providing a safe, rewarding and respectful workplace where our people are provided with opportunities to pursue
career paths based on skills, performance and mindset. We adhere to our Code of Conduct, which sets forth a commitment to
our stakeholders, including our employees, to operate with integrity and mutual respect.
Health and Safety
We are committed to maintaining a healthy and safe workplace for our employees. In our Voerde, Germany manufacturing
facility, we have a comprehensive safety and risk management system in place that incorporates rigorous safety standards and
practices, employee and leadership training to ensure consistent implementation of our safety protocols and periodic internal
and external audits to evaluate our compliance with these policies.
Talent Acquisition, Development, Engagement and Retention
Acquiring, developing, engaging and retaining a diverse and talented workforce is key to accomplishing our goals and
achieving business results.
Our talent acquisition processes include diversity training for recruiters and employee training on interview skills and
processes to improve our candidate selection process. For candidate selection roundtables, we have a trained, disinterested
employee sit in to help mitigate any instances of bias in the selection discussion. We have also expanded outreach to diverse
candidate pools and career fairs to enable us to reach a wider audience of candidates, as well as expanding our lens on hiring
people from non-traditional backgrounds or career paths.
Providing development opportunities and resources for our employees is another key factor in our human capital strategy.
We offer a variety of training and development programs and platforms for employees at all levels of our organization,
including monthly development trainings for all employees along with separate interactive trainings for people leaders of all
levels.
We check in with our employees through regular engagement surveys, small group and one-on-one discussions and then
we act on those survey and discussion results, as appropriate. Employee-led groups, opportunities to participate in informal
wellness activities and philanthropic work are informed by what issues our employees identify as important to them. We
measure our progress and take additional actions, as needed. We communicate transparently with our employees about the
organization to keep our employees informed and highly engaged.
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We connect our employees to our values and culture by conducting periodic two-day in-person workshops where they can
learn about, discuss and engage with these topics to more fully appreciate our unique culture. In addition, we invite esteemed
speakers to our Emeryville offices, as well as partnering with outside experts to engage our employees in an interactive
workshop format to further drive engagement with timely workplace initiatives.
We strive to develop and implement compensation and benefits policies and programs that support our business goals,
benchmark and maintain competitiveness, promote shared fiscal responsibility among the Company and our employees,
strategically align talent within our organization and reward performance, while also managing the costs of such policies and
programs. We provide our employees with competitive fixed and/or variable pay and, for eligible employees, we currently
provide access to medical, dental and life insurance benefits, disability coverage, a 401(k) plan and employee assistance
programs - including mental health - among other benefits.
Diversity, Equity, Inclusion and Belonging
We recognize the importance of a diverse, equitable and inclusive culture for our employees and are committed to creating
an inclusive environment that reflects the communities in which we live and work that creates belonging. We have implemented
initiatives to track and improve our performance in these areas. We also provide interactive anti-harassment and diversity
training for both supervisory and non-supervisory employees taught by outside experts. Our Board of Directors receives
periodic updates regarding our diversity, equity, inclusion and belonging efforts.
Environmental, Social and Governance
We recognize the importance of Environmental, Social and Governance (“ESG”) issues for all of our stakeholders and we
are committed to incorporating ESG principles into our business strategies and organizational culture. The Audit Committee of
the Company’s Board of Directors provides direction with respect to the evolving priorities of our ESG initiatives and receives
quarterly reports with respect to the progress the Company is making against its objectives. We have an Executive
Sustainability Steering Committee comprised of senior leaders within our organization, which provides guidance on goals and
strategies and makes recommendations on disclosure and reporting guidelines. We also have a Sustainability Operations
Committee comprised of technical experts within key business functions that meets regularly to implement programs and track
progress on key objectives. We report to our stakeholders with respect to the results of our ESG initiatives on an annual basis,
with our fourth annual Impact Report being published online later this year.
Additional Information
We make available, free of charge, through our website (www.bellring.com) reports we file with, or furnish to, the
Securities and Exchange Commission (the “SEC”), including our annual reports on Forms 10-K, quarterly reports on Forms 10-
Q, current reports on Forms 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the
Exchange Act as soon as reasonably practicable after we electronically file such material with, or furnish such material to, the
SEC. The SEC maintains an internet site containing these reports, proxy and information statements and other information
regarding issuers that file electronically with the SEC at http://www.sec.gov. Our Corporate Governance Guidelines, our Code
of Conduct and the charters of the Audit and Corporate Governance and Compensation Committees of our Board of Directors
also are available on our website, where they can be printed free of charge. All of these documents also are available to
stockholders at no charge upon request sent to BellRing’s corporate secretary (2503 S. Hanley Road, St. Louis, Missouri 63144-
2503, Telephone: 314-644-7600). The information and other content contained on our website are not part of (or incorporated
by reference in) this report or any other document we file with the SEC.
Information about our Executive Officers
The section below provides information regarding our executive officers as of November 19, 2024:
Robert V. Vitale, age 58, has served as our Executive Chairman since September 2019. Mr. Vitale has been the President
and Chief Executive Officer of Post, and a member of Post’s board of directors, since November 2014 and is a member of the
board of directors of 8th Avenue Food & Provisions, Inc., a private brand-centric consumer products holding company owned
by Post and other third parties. Previously, Mr. Vitale served as Chief Financial Officer of Post from October 2011 until
November 2014. Mr. Vitale has served on the board of directors of Energizer Holdings, Inc., a publicly traded manufacturer and
distributor of primary batteries, portable lights and auto care appearance, performance, refrigerant and fragrance products, since
August 2017. He served as President and Chief Executive Officer of AHM Financial Group, LLC, a diversified provider of
insurance brokerage and wealth management services, from 2006 until 2011 and previously was a partner of Westgate Equity
Partners, LLC, a consumer-oriented private equity firm. Mr. Vitale earned his undergraduate degree from St. Louis University
and his MBA from Washington University.
Darcy H. Davenport, age 51, has served as our President and Chief Executive Officer since September 2019 and has served
as a member of our Board of Directors since the completion of our initial public offering (the “IPO”). Until the completion of
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the IPO, Ms. Davenport served as President of Post’s active nutrition business since October 2017 and as President of Premier
Nutrition, which became a subsidiary of BellRing Inc. upon completion of our IPO, since November 2016. Ms. Davenport
previously served as General Manager of Premier Nutrition from October 2014 to November 2016 and Vice President of
Marketing from October 2011 to October 2014. Prior to joining Premier Nutrition, Ms. Davenport served as Director of Brand
Marketing at Joint Juice, Inc., a liquid dietary supplement manufacturer, from May 2009 to October 2011, when it combined
with Premier Nutrition. Ms. Davenport has served as a member of the board of directors of Blentech Corporation, a company
focusing on developing custom-made, food processing solutions including equipment, integrated systems and software, since
January 2010. Ms. Davenport earned her undergraduate degree from Princeton University and her MBA from New York
University’s Leonard N. Stern School of Business.
Douglas J. Cornille, age 52, has served as Chief Growth Officer of Premier Nutrition, a subsidiary of ours, since
November 2021. Prior to that, he served as Senior Vice President, Marketing of Premier Nutrition since July 2015. Prior to
joining Premier Nutrition, Mr. Cornille was Brand Director at Clif Bar & Company, a manufacturer of various food products,
from August 2011 to July 2015 and was Senior Brand Manager at Dreyer’s Grand Ice Cream Holdings, Inc., a manufacturer of
ice cream and frozen yogurt, from September 2003 to August 2011. Mr. Cornille earned his undergraduate degree from Rhodes
College and attended Oxford University, St. John’s College. Mr. Cornille earned his MBA from Duke University - The Fuqua
School of Business.
Marc S. Mollere, age 57, has served as Senior Vice President and General Manager of International of Premier Nutrition, a
subsidiary of ours, since 2020. Prior to that, he served as General Manager and Vice President of Sales and Marketing of
Dymatize Enterprises, also a subsidiary of ours, since 2011. Prior to joining Dymatize Enterprises, Mr. Mollere was Corporate
Vice President and Vice President of Sales of Henkel North America, a beauty care and laundry & home care consumer
business, from 2006 to 2011. Mr. Mollere earned his BS in Marketing from Sam Houston State University.
Paul A. Rode, age 54, has served as our Chief Financial Officer since September 2019 and serves as our principal financial
officer and principal accounting officer. Mr. Rode served as Chief Financial Officer of Post’s active nutrition business from
May 2015 until the completion of our IPO and as Chief Financial Officer of Consumer Brands, a prior reporting segment of
Post, from November 2014 to May 2015. Mr. Rode previously served as Vice President, Finance of Post from January 2014 to
November 2014 and Vice President, Corporate Development of Post from October 2013 to January 2014. Prior to joining Post,
Mr. Rode served as Vice President, Corporate Controller of Ralcorp Holdings, Inc., which was a publicly traded consumer
products company and the former parent company of Post, from February 2010 to September 2013. Mr. Rode earned his
undergraduate degree from the University of Kentucky and his MBA from Northwestern University’s Kellogg School of
Management.
Craig L. Rosenthal, age 53, has served as our Chief Legal Officer, Chief Compliance Officer and Secretary since
September 2023 and, prior to that, served as our Senior Vice President, General Counsel and Secretary since August 2019. Prior
to joining BellRing, Mr. Rosenthal was an attorney at Husch Blackwell LLP from May 2019 to August 2019. From January
2018 to May 2019, while complying with the terms of a non-competition agreement entered into with a previous employer that
expired in March 2019, Mr. Rosenthal provided legal counsel regarding business transactions to small businesses and
individuals. Mr. Rosenthal served as Senior Vice President-Law and Assistant Secretary at Altice USA, Inc., a publicly traded
broadband communications and video services provider, from June 2016 to December 2017. Prior to that, Mr. Rosenthal was
Senior Vice President, General Counsel and Secretary at Cequel Communications, LLC dba Suddenlink Communications, a
telecommunications and technology company, from 2005 to June 2016, when it was acquired by Altice USA, Inc. Previously,
Mr. Rosenthal was an attorney at Husch & Eppenberger LLC (now Husch Blackwell LLP). Mr. Rosenthal earned his
undergraduate degree from the University of Missouri-Columbia and juris doctorate from Washington University School of
Law.
Robin Singh, age 55, has served as Senior Vice President, Operations of Premier Nutrition, a subsidiary of ours, since
March 2019. Prior to joining Premier Nutrition, Mr. Singh held various senior leadership positions at Mondelez International,
Inc., a publicly traded multinational snack food company, from 1996 until March 2019, including Vice President of Operations
from July 2018 to March 2019, Director of Supply Chain Strategy and Supply Chain Reinvention North America from February
2016 to July 2018, and Director of Supply Planning North America from January 2014 to January 2016. Mr. Singh received his
Honors Bachelor of Science from the University of Guelph, Ontario and a certificate in the Ivey Operations Program from the
Richard Ivey School of Business at the University of Western Ontario.
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ITEM 1A. RISK FACTORS
In addition to the information discussed elsewhere in this report, the following risks and uncertainties, some of which have
occurred and any of which may occur in the future, could have a material adverse effect on our business, financial condition,
results of operations and cash flows. Although the risks below are organized by heading, and each risk is described separately,
many of the risks are interrelated. Additional risks and uncertainties not presently known to us or that we currently deem
immaterial also may impair our business, financial condition, results of operations and cash flows.
Industry and Operating Risks
A substantial amount of our net sales comes from our RTD protein shakes, and a decrease in sales of our RTD protein
shakes would adversely affect our business, financial condition, results of operations and cash flows.
A substantial amount of our net sales is derived from our RTD protein shakes. Sales of our RTD protein shakes represented
approximately 81.1% of our net sales in our year ended September 30, 2024. We believe that sales of our RTD protein shakes
will continue to constitute a substantial amount of our net sales for the foreseeable future. Our business, financial condition,
results of operations and cash flows would be harmed by a decline in the market for our RTD protein shakes, increased
competition in the market for those products, disruptions in our ability to produce those products, whether due to manufacturer
inability, supply chain failures or otherwise, or our failure or inability to provide sufficient investment to support and market
those products as needed to maintain or grow their competitive position or to achieve more widespread market acceptance.
We operate in a category with strong competition.
The convenient nutrition category in which we operate is highly competitive. We compete with other brands in the
convenient nutrition category and with many nutritional food and beverage players, as well as manufacturers of private label
and store brand products. Many of our competitors offer products similar to our products, or a wider range of products than we
offer, and may offer their products at more competitive prices than we do. Competition in our industry is based on, among other
things, product quality, taste, functional benefits, nutritional value and ingredients, convenience, brand loyalty and positioning,
product variety, product packaging, shelf space, price, promotional activities and the ability to identify and satisfy dynamic,
emerging consumer preferences. Some of our principal competitors have substantially more financial, marketing and other
resources than we have. A strong competitive response from one or more of our competitors to our marketplace efforts, or a
shift in consumer preferences to competitors’ products, could result in us reducing pricing, increasing marketing or other
expenditures or losing market share. Competitive pressures also may restrict our ability to increase our prices, including in
response to cost increases. Our profits could decrease if a reduction in prices or increased costs are not counterbalanced with
increased sales volume. In addition, our competitors are increasingly using social media networks and digital media platforms
to advertise products. If we are unable to use social media and digital media platforms effectively to advertise our products, it
could adversely affect our business, financial condition, results of operations and cash flows.
Disruption of our supply chain and changes in weather conditions could have an adverse effect on our business, financial
condition, results of operations and cash flows.
Our ability to make, move and sell products in coordination with our suppliers, third-party contract manufacturers and
distributors is critical to our success. Damage or disruption to our collective supply, manufacturing or distribution capabilities
resulting from weather, freight carrier availability, any potential effects of climate change, natural disaster, pandemics or other
outbreaks of contagious diseases, governmental restrictions or mandates, labor shortages, border closures, freight carrier
availability, agricultural diseases, fires or evacuations related thereto, explosions, cyber incidents, terrorism, strikes or other
labor unrest, repairs or enhancements at facilities manufacturing or delivering our products or other reasons could impair our
ability to source inputs or manufacture, sell or timely deliver our products. During fiscal 2022, the COVID-19 pandemic
impacted our operations, including causing disruptions in our supply chain.
Changes in weather conditions and natural disasters, such as fires, floods, droughts, frosts, hurricanes, earthquakes,
tornadoes, insect infestations and plant disease, also may affect the cost and supply of commodities used as raw materials,
including milk-based, whey-based and soy-based proteins, protein blends, sweeteners and vitamin and mineral blends. Further,
as we rely on a limited number of third-party suppliers to provide certain ingredients and packaging materials, and one supplier
for the majority of our milk-based protein, adverse events affecting such suppliers may limit our ability to obtain such raw
materials, or alternatives for these raw materials, at competitive prices, or at all. For example, for our year ended September 30,
2024, approximately 47.7% of our Premier Protein RTD shake supply came from our largest third-party contract manufacturer,
with approximately 28.9% of our Premier Protein RTD shake supply manufactured at a single facility. In addition, production
of the RTD protein shakes in the 11 ounce size by our third-party contract manufacturers requires packaging that we currently
are sourcing from only one supplier, and equipment that our third-party contract manufacturers are currently sourcing from the
same supplier. Our supply of packaging for our 11 ounce Premier Protein RTD protein shakes from this supplier comes
primarily from three of its locations. Further, a majority of production of our Premier Protein RTD protein shakes in the 11.5
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ounce size are currently sourced from a single facility of a third-party contract manufacturer. Competitors can be affected
differently by weather conditions and natural disasters depending on the location of their suppliers and operations.
We are dependent on third-party contract manufacturers for the manufacture of most of our products, including one
manufacturer for nearly half of our RTD protein shakes. Our business could suffer if we do not continue to contract with
key third-party manufacturers or as a result of a third-party contract manufacturer’s inability to produce our products for
us in the quantities required, on time or to our specifications.
All of our RTD protein shakes and most of our other products are manufactured by independent third-party contract
manufacturers. For our year ended September 30, 2024, approximately 47.7% of our Premier Protein RTD shake supply came
from a single manufacturer and approximately 28.9% from a single facility of that manufacturer. Further, a majority of
production of our Premier Protein RTD protein shakes in the 11.5 ounce size are currently sourced from a single facility of a
third-party contract manufacturer. Although we have added additional third-party contract manufacturers of our Premier Protein
RTD shakes to our third-party contract manufacturing network, if one or more of our third-party contract manufacturers is
unable to meet our supply requirements, it could have a material adverse impact on our business, financial condition, results of
operations and cash flows. In fiscal 2019, a former third-party contract manufacturer that we had expected to produce less than
10% of our RTD protein shakes for that year did not produce as we expected, which resulted in our termination of our
agreement with it. Also, if we experience significant increases in demand for our products, as we did beginning in the second
quarter of fiscal 2021 through fiscal 2023, we and these third-party contract manufacturers may not be able to obtain in a timely
manner the equipment, ingredients or packaging materials required to manufacture our products and allocate sufficient capacity
to us in order to meet our requirements, fill our orders in a timely manner or meet our quality standards. Further, as we did in
fiscal 2022 through fiscal 2024, we may experience operational difficulties with any of these third-party contract manufacturers,
such as limitations on production capacity, failure to meet our quantity requirements, including as a result of pandemics or other
outbreaks of contagious diseases, increases in manufacturing costs, errors in complying with product specifications, insufficient
quality control and failure to meet production deadlines. We have had to limit our stock-keeping units (“SKUs”) and place one
or more of our products on allocation. In addition, we rely in part on our third-party contract manufacturers to maintain the
quality of our products. The failure or inability of our third-party contract manufacturers to comply with the specifications and
requirements of our products could result in product withdrawal or recall, which could materially and adversely affect our
reputation and subject us to significant liability should the consumption of any of our products cause or be claimed to cause
illness or physical harm. For example, in fiscal 2022, a third-party manufacturer that produced less than 2% of our Premier
Protein RTD protein shakes initiated a recall of all products manufactured in one of its facilities, including our Premier Protein
RTD protein shakes. The inability of third-party contract manufacturers to ship orders in a timely manner, in desirable
quantities or to meet our safety, quality and social compliance standards or regulatory requirements could have a material
adverse impact on our business, financial condition, results of operations and cash flows. Additionally, our business could be
adversely affected if any of these third parties fail to comply with governmental regulations applicable to the manufacturing of
our products or if any of these third parties cease doing business with us or go out of business.
Certain of our relationships with these third parties are subject to minimum volume commitments, whereby the third-party
contract manufacturer has committed to produce, and we have committed to purchase, a minimum quantity of product, and we
or the contract manufacturer may alternatively pay the other a mostly fixed amount rather than produce or purchase the
minimum quantities. Despite the minimum volume commitments, we may nonetheless experience situations where such
manufacturers are unable to fulfill their minimum volume obligations under our agreements or cannot produce sufficient
amounts of product to meet consumer demand. For example, due to (i) better than expected volume growth for our Premier
Protein RTD shakes and Dymatize powders in fiscal 2022 and, as to Premier Protein RTD shakes in fiscal 2023, (ii) delays in
production and planned incremental production capacity by our third-party contract manufacturer network and (iii) in the case
of Dymatize powders, whey protein availability, our customer demand exceeded our available capacity and resulted in Premier
Protein RTD shakes and Dymatize powders inventories below acceptable levels during fiscal 2021 and Premier Protein RTD
shakes inventories below acceptable levels in fiscal 2022, fiscal 2023 and into fiscal 2024. If we need to replace an existing
third-party contract manufacturer, our products may not be available when required on acceptable terms, or at all. Also, if
demand for our products is significantly below our expectations, we may be obligated to pay penalties to our third-party
contract manufacturers for failing to purchase contracted minimum purchase quantities.
Our reliance on a limited number of suppliers for certain equipment, ingredients and packaging materials, the price and
availability of ingredients and packaging materials, higher freight costs and higher energy costs could negatively impact our
business, financial condition, results of operations and cash flows.
We rely on a limited number of third-party suppliers to provide certain equipment, ingredients and packaging materials
used in our business. The primary ingredients used in our business include milk-based, whey-based and soy-based proteins,
protein blends, sweeteners and vitamin and mineral blends, and one supplier provides the majority of our milk-based protein.
The supply and price of these ingredients are subject to market conditions and are influenced by many factors beyond our
control, including inflation and increased demand, labor shortages, animal feed costs, weather patterns affecting ingredient
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production, governmental programs and regulations and pandemics or other outbreaks of contagious diseases. Our milk-based
protein costs have increased and may continue to increase due to factors such as inflation and increased demand, labor
shortages, animal feed costs, weather patterns affecting ingredient production, governmental programs and regulations and
pandemics or other outbreaks of contagious diseases,. Our primary packaging materials include aseptic foil and plastic lined
cardboard cartons, flexible and rigid plastic film and containers, beverage packaging and corrugate. We utilize a sole supplier
for the aseptic packaging for, and our third-party contract manufacturers use equipment from the same sole supplier to
manufacture, our Premier Protein RTD shakes in the 11 ounce size. Although we maintain relationships with suppliers with the
objective of ensuring that we have adequate sources for the supply of such ingredients and packaging materials, increases in
demand for such items, both within our industry and in general, can result in shortages and higher costs. Our suppliers may not
be able to meet our delivery schedules, we may lose a significant or sole supplier, a supplier may not be able to meet
performance and quality specifications and we may not be able to purchase such items at a competitive cost. Further, the supply
and price of these inputs are subject to market conditions and are impacted by many factors beyond our control, including
inflation and increased demand, labor shortages, weather conditions, natural disasters, governmental programs, regulations and
trade and tariff policies and pandemics and other outbreaks of contagious diseases. Our freight costs have increased and may
continue to increase due to factors such as inflation and increased demand, labor shortages, increased fuel costs, limited carrier
availability, increased compliance costs associated with new or changing government regulations, pandemics or other outbreaks
of contagious diseases. Higher prices for natural gas, propane, electricity and fuel also may increase our ingredient, production
and delivery costs. Historically, the prices of certain of our raw materials, energy and other supplies used in our business have
fluctuated widely. In addition, we have experienced shortages of certain of our raw materials, which result in us paying
increased costs for such inputs and impact our ability to produce our products.
The prices charged for our products may not reflect changes in our input costs at the time they occur, or at all. Accordingly,
changes in input costs may limit our ability to maintain existing margins and may have a material adverse effect on our
business, financial condition, results of operations and cash flows. While we try to manage the impact of increases in certain of
these costs by locking in prices on quantities required to meet our anticipated production requirements, if we fail, or are unable,
to hedge and prices subsequently increase, or if we institute a hedge and prices subsequently decrease, our costs may be greater
than anticipated or greater than our competitors’ costs, and our business, financial condition, results of operations and cash
flows could be adversely affected.
Certain of our relationships with third-party ingredient and packaging suppliers are subject to minimum volume
commitments, whereby the third-party supplier has committed to sell, and we have committed to purchase, minimum quantities
and we or, in some cases the third-party supplier, may alternatively pay the other a mostly fixed amount rather than sell or
purchase the minimum quantities. Despite the minimum volume commitments, we may nonetheless experience situations
where such third-party suppliers are unable to fulfill their minimum volume obligations under our agreements or cannot provide
sufficient amounts ingredients or packaging to meet consumer demand for our products. If we need to replace an existing third-
party supplier, our products may not be available when required on acceptable terms, or at all. Also, if demand for our products
is significantly below our expectations, we may be obligated to pay penalties to our third-party suppliers for failing to purchase
contracted minimum purchase quantities.
We must identify changing consumer and customer preferences and behaviors and develop and offer products to meet these
preferences.
Consumer and customer preferences and behaviors evolve over time due to a variety of factors. The success of our business
depends on our ability to identify these changing preferences and behaviors, to distinguish between short-term trends and long-
term changes in such preferences and behaviors, and to continue to develop and offer products that appeal to consumers and
customers through the sales channels that they prefer. Consumer preference and behavior changes include dietary trends,
attention to different nutritional aspects of foods and beverages, acceptance and the use of weight management medication,
consumer in-home and on-the-go consumption patterns, preferences for certain sales channels, concerns regarding the health
effects of certain foods and beverages, attention to sourcing practices relating to ingredients, animal welfare concerns,
environmental concerns regarding packaging and attention to other social and governance aspects of our Company and
operations. Several of our customers have announced goals to transition to recyclable, compostable or reusable packaging.
These changing preferences and requirements could require us to use specially sourced ingredients and packaging types that
may be more difficult to source or entail a higher cost or incremental capital investment which we may not be able to pass on to
customers.
Consumers are increasingly shopping through eCommerce websites and mobile commerce applications and this trend is
significantly altering the retail landscape in our category. If we are unable to effectively compete in the expanding eCommerce
market or develop the data analytics capabilities needed to generate actionable commercial insights, our business performance
may be impacted, which may negatively impact our financial condition, results of operations and cash flows.
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Emerging science and theories regarding health are constantly evolving, and products or methods of eating once considered
healthy may over time become disfavored by consumers or no longer be perceived as healthy. Approaches regarding healthy
lifestyles also are the subject of numerous studies and publications, often with differing views and opinions, some of which may
be adverse to us. The growing acceptance and use of medication to manage weight could negatively affect the demand for many
types of food in general, including our products. In order to respond to new and evolving consumer and customer demands,
achieve market acceptance and keep pace with new nutritional, technological and other developments, we must constantly
introduce new and innovative products into the market. We may not be successful in developing, introducing on a timely basis
or marketing any new or enhanced products, and specifically, the initial sales volumes for new or enhanced products may not
reach anticipated levels, we may be required to engage in extensive marketing efforts to promote such products, the costs of
developing and promoting such products may exceed our expectations and such products may not perform as expected. Further,
certain ingredients used in our products may become negatively perceived by consumers, resulting in decreased demand for our
products or reformulation of existing products to remove such ingredients, which may negatively affect taste or other qualities.
Prolonged negative perceptions concerning the health implications of certain food and beverage products could influence
consumer preferences and acceptance of some of our products and marketing programs.
Although we strive to respond to consumer or customer preferences and social expectations, we may not be successful in
these efforts. Any significant changes in consumer or customer preferences or our inability to anticipate or react, or effectively
introduce new products in response, to such changes could result in reduced demand for our products, which could negatively
impact our business, financial condition, results of operations and cash flows.
Our results may be adversely impacted if consumers do not maintain favorable perceptions of our brands.
Maintaining and continually enhancing the value of our brands is critical to the success of our business. Brand value is
based in large part on consumer perceptions. Brand value could diminish significantly due to a number of factors, including our
products becoming unavailable to consumers, our failure to maintain the quality of our products, the failure of our products to
deliver consistently positive consumer experiences, adverse publicity about our or our suppliers’ or third-party contract
manufacturers’ business practices, our products, packaging or ingredients, concerns about food safety, real or perceived health
concerns regarding our products or consumer perception that we have acted in an irresponsible manner. Consumer demand for
our products also may be impacted by changes in the level of advertising or promotional support. We may need to increase our
marketing and advertising spending in order to maintain and increase customer and consumer awareness, protect and grow our
existing market share or to promote new products, which could impact our business, financial condition, results of operations
and cash flows. However, an increase in our marketing and advertising efforts may not maintain our current reputation or lead
to an increase in brand awareness. Negative perceptions of the food and beverage industry as a whole, or the convenient
nutrition category, may heighten attention from consumers, third parties, the media, governments, stockholders and other
stakeholders to such factors and could adversely affect our brand image. The growing use of social and digital media by
consumers, us and third parties increases the speed and extent that information or misinformation and opinions can be shared.
Negative posts or comments about us, our brands, products or packaging or the food and beverage industry generally on social
or digital media (whether factual or not) or security breaches related to use of our social media could seriously damage our
brands and reputation. If we do not maintain favorable perceptions of our products and our brands, or if we experience a loss of
consumer confidence in our brands, our business, financial condition, results of operations and cash flows could be adversely
impacted.
In addition, our success in maintaining and enhancing our brand image depends on our ability to anticipate change and
adapt to a rapidly changing marketing and media environment, including our increasing reliance on social media and online,
digital and mobile dissemination of marketing and advertising campaigns and the increasing accessibility and speed of
dissemination of information. Furthermore, third parties may sell counterfeit or imitation versions of our products that are
inferior or pose safety risks. If consumers confuse these counterfeit products for our products or have a bad experience with the
counterfeit brand, they might refrain from purchasing our brands in the future, which could harm our brand image and sales. If
we do not successfully maintain and enhance our reputation and brand health, then our brands, product sales, financial
condition, results of operations and cash flows could be materially and adversely affected.
Consolidation in our distribution channels, and competitive, economic and other pressures facing our customers, may hurt
our profit margins.
Over the past several years, our channels have undergone significant consolidations and mass merchandisers and non-
traditional retailers are gaining market share. As this trend continues and such customers grow larger, they may seek to use their
position to improve their profitability through improved efficiency, lower pricing, increased reliance on their own brand name
products, increased emphasis on generic and other value brands and increased promotional programs. If we are unable to
respond to these requirements, our profitability or volume growth could be negatively impacted. Additionally, if any of our
customers are consolidated with another entity and the surviving entity of any such consolidation is not a customer or decides to
discontinue purchasing our products, we may lose significant amounts of our preexisting business with the acquired customer.
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Further, the economic and competitive landscape for our customers is constantly changing, such as the emergence of new sales
channels, and our customers’ responses to those changes could impact our business. Consolidation in our channels also
increases the risk that adverse changes to our customers’ business operations or financial performance would have a material
adverse effect on us.
Our sales and profit growth are dependent upon our ability to expand existing market penetration and enter into new
markets.
Successful growth depends on our ability to add new customers, enter into new markets, expand the number of products
sold through existing customers and enhance our product portfolio. This growth would include expanding the number of our
products retailers offer for sale, our product placement and our ability to secure additional shelf or retail space for our products,
as well as increased access to online platforms to sell our products. The expansion of our business depends on our ability to
obtain new, or expand our business with existing, customers, such as club, FDM, eCommerce, convenience and specialty
customers. Our failure to successfully add new customers, enter into new markets, expand the number of products sold through
existing customers and enhance our product portfolio could have a material adverse effect on our business, financial condition,
results of operations and cash flows.
If our products become contaminated or adulterated, or if they are misbranded or mislabeled, we might need to recall or
withdraw those items and we may experience product liability claims.
Selling food products, beverages and nutritional supplements involves a number of legal and other risks, including
contamination, spoilage, degradation, tampering, mislabeling or other adulteration. Additionally, many of the raw materials
used to make certain of our products, particularly milk-based protein, are vulnerable to spoilage and contamination by naturally
occurring molds and pathogens, such as salmonella, and pests. These pathogens may survive in our products as a result of
improper handling by customers or consumers. We do not have control over handling procedures once our products have been
shipped for distribution. We may need to recall or withdraw some or all of our products if they become damaged, contaminated,
adulterated, mislabeled or misbranded, whether caused by us or someone in our manufacturing or supply chain. For example, in
fiscal 2022, a third-party manufacturer that produced less than 2% of our Premier Protein RTD protein shakes initiated a recall
of all products manufactured in one of its facilities, including our Premier Protein RTD protein shakes. A recall or withdrawal
could result in destruction of product ingredients and inventory, negative publicity, temporary plant closings for us or our third-
party contract manufacturers, supply chain interruption, substantial costs of compliance or remediation, fines and increased
scrutiny by federal, state and foreign regulatory agencies. New scientific discoveries regarding microbes and food
manufacturing may bring additional risks and latent liability. Should consumption of any product cause injury, we may be liable
for monetary damages as a result of a judgment against us. In addition, adverse publicity, including claims, whether or not
valid, that our products or ingredients are unsafe or of poor quality, may discourage customers or consumers from buying our
products or cause production and delivery disruptions. Although we have various insurance programs in place and may have
rights to indemnification in certain situations, any of these events or a loss of customer or consumer confidence could have an
adverse effect on our business, financial condition, results of operations and cash flows.
Loss of, a significant reduction of purchases by or bankruptcy of a major customer may adversely affect our business,
financial condition, results of operations and cash flows.
A limited number of customer accounts represents a large percentage of our combined net sales. Our largest customers,
Walmart and its affiliates (which includes Sam’s Club), Costco and Amazon, accounted for approximately 74.8% of our net
sales in our year ended September 30, 2024.
The success of our business depends, in part, on our ability to maintain our level of sales and product distribution through
the club, FDM, eCommerce, specialty and convenience channels. The competition to supply products to these high-volume
customers is intense. Currently, we do not have material long-term supply agreements with our customers, and our customers
frequently reevaluate the products they carry. A decision by our major customers to decrease the amount of product purchased
from us, including in response to shifts in consumer purchasing or traffic trends, sell another brand on an exclusive or priority
basis or change the manner of doing business with us could reduce our revenues and materially adversely affect our business,
financial condition, results of operations and cash flows. Our customers also may offer branded and private label products that
compete directly with our products for retail shelf space and consumer purchases. Accordingly, there is a risk that our customers
may give higher priority to their own products or to the products of our competitors. In the event of a loss of any of our large
customers, a significant reduction of purchases by any of our large customers or the bankruptcy or serious financial difficulty of
any of our large customers, our business, financial condition, results of operations and cash flows may be adversely affected.
Fluctuations in our business due to changes in our promotional activities and seasonality may have an adverse impact on
our financial condition, results of operations and cash flows.
We periodically offer a variety of sales and promotional incentives to our customers and consumers. Our net sales and
profitability are impacted by the introduction and discontinuance of such sales and promotion incentives. In addition, we have
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experienced and expect to continue to experience fluctuations in our quarterly results of operations due to the seasonal nature of
our business. Seasonality could cause our results of operations for an interim financial period to fluctuate and not be indicative
of our full year results. Seasonality also impacts relative revenue and profitability of each quarter of the year, both on a quarter-
to-quarter and year-over-year basis. If we fail to effectively manage our inventories, fluctuations in business as a result of
promotional activities and seasonality may have an adverse impact on our financial condition, results of operations and cash
flows.
Our international operations subject us to additional risks.
We are subject to a number of risks related to doing business internationally, any of which could significantly harm our
financial and operational performance. These risks include:
•
restrictions on the transfer of funds to and from foreign countries, including potentially negative tax consequences;
•
unfavorable changes in tariffs, quotas, trade barriers or other export or import restrictions;
•
unfavorable changes in local regulatory requirements that impact our ability to sell our products in that country;
•
unfavorable foreign exchange controls and currency exchange rates;
•
challenges associated with cross-border product distribution;
•
an outbreak of a contagious disease, which may cause us or our distributors, third-party contract manufacturers,
vendors or customers to temporarily suspend our or their respective operations in the affected city or country;
•
increased exposure to general market and economic conditions, political and economic uncertainty and volatility and
other events, including social unrest, government shutdowns, terrorist activity, acts of war and travel restrictions,
outside of the U.S.;
•
compliance with U.S. laws and regulations affecting operations outside of the U.S., including anti-corruption
regulations (such as the U.S. Foreign Corrupt Practices Act), and changes to such laws and regulations;
•
compliance with treaties, antitrust and competition laws, data privacy laws (including the General Data Protection
Regulation and the E.U.’s General Data Protection Regulation and the E.U.-U.S. Data Privacy Framework), anti-
corruption laws (including the U.K. Bribery Act), food safety and marketing laws and other regulatory requirements
and a variety of other local, national and multi-national regulations and laws in multiple jurisdictions and changes to
such laws and regulations;
•
unfavorable changes in foreign tax treaties and policies, changes in the mix of earnings in countries with differing
statutory tax rates, changes in the valuation of deferred tax assets and liabilities, changes in tax laws or their
interpretations or tax audit implications;
•
the difficulty and costs of maintaining effective data security;
•
the potential difficulty of enforcing intellectual property and contractual rights;
•
increased risk of uncollectible accounts and longer collection cycles;
•
unfavorable changes in labor conditions and difficulties in staffing our operations; and
•
the difficulty and costs of designing and implementing an effective control environment across geographic regions.
Our financial performance on a U.S. dollar denominated basis is subject to fluctuations in currency exchange rates.
Because we have operations and assets in foreign jurisdictions, as well as a portion of our contracts and revenues denominated
in foreign currencies, and our consolidated financial statements are presented in U.S. dollars, we must translate our foreign
assets, liabilities, revenues and expenses into U.S. dollars at applicable exchange rates. Consequently, fluctuations in the value
of foreign currencies relative to the U.S. dollar may negatively affect the value of these items in our consolidated financial
statements. Our principal currency exposures are to the Canadian dollar and the Euro. To the extent we fail to manage our
foreign currency exposure adequately, we may suffer losses in value of our net investment in a foreign operation, and our
business, financial condition, results of operations and cash flows may be negatively affected.
Our market size and related estimates may prove to be inaccurate.
Data for the convenient nutrition category is collected for most, but not all, channels, and as a result, it is difficult to
estimate the size of the market and predict the rate at which the market for our products will grow. We estimate the market size
of the convenient nutrition category, including by geography, product form and consumer need state, based, in part, upon
forecasts and information obtained from independent trade associations, industry publications and surveys and other
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independent sources, proprietary research studies and management’s knowledge of the industry. While these estimates are made
in good faith and are based on assumptions and estimates we believe to be reasonable, they may not be accurate.
Our intellectual property rights are valuable and any inability to protect them, or termination of our material intellectual
property licenses, could reduce the value of our products and brands and have a material adverse effect on our business.
We consider our intellectual property rights, particularly our trademarks, but also our patents, trade secrets, know-how and
copyrights, to be a significant and valuable asset of our business. We attempt to protect our intellectual property rights through a
combination of patent, trademark, copyright and trade secret laws, as well as third-party nondisclosure, confidentiality and
assignment agreements and confidentiality provisions in third-party agreements and the policing of third party misuses of our
intellectual property. Our failure or inability to obtain or maintain adequate protection of our intellectual property rights, or any
change in law or other changes that serve to lessen or remove the current legal protections of intellectual property, may
diminish our competitiveness and could materially harm our business. We also are subject to risks associated with protection of
our trademarks and other intellectual property licensed to distributors of our products and of our trade secrets to our third-party
contract manufacturers. If our licensed distributors or third-party contract manufacturers fail to protect our trademarks, trade
secrets and other intellectual property, either intentionally or unintentionally, our business, financial condition, results of
operations and cash flows may be adversely affected.
We market certain of our products pursuant to intellectual property license agreements. These licenses give us the right to
use certain names, characters and logos in connection with our products and to sell the products. If we were to breach any
material term of these license agreements and not timely cure the breach, the licensor could terminate the agreement. If the
licensor were to terminate our rights to use the names, characters and logos for this reason or any other reason, or if a licensor
decided not to renew a license agreement upon the expiration of the license term, the loss of such rights could have a material
adverse effect on our business.
We may not be able to effectively manage our growth, which could materially harm our business, financial condition, results
of operations and cash flows.
Our growth has placed, and we expect that our continued growth may place, a significant demand on our management,
personnel, systems and resources. Our continued growth will require an increased investment by us in our third-party
manufacturing relationships, personnel, technology, facilities and financial and management systems and controls, including
monitoring and assuring our compliance with applicable regulations. We will need to integrate, train and manage a growing
employee base. Unless our growth results in an increase in our revenues that is proportionate to the increase in our costs
associated with this growth, our operating margins and profitability will be adversely affected. If we fail to effectively manage
our growth, our business, financial condition, results of operations and cash flows could be materially harmed.
Technology failures, cybersecurity incidents and corruption of our data privacy protections could disrupt our operations and
negatively impact our business.
We rely on information technology networks and systems to process, transmit and store operating and financial
information, to manage and support a variety of business processes and activities and to comply with regulatory, legal and tax
requirements. We also depend upon our information technology infrastructure for digital marketing activities and for electronic
communications among our locations, personnel, customers, third-party contract manufacturers and suppliers. Our and our
third-party manufacturing and distribution facilities and inventory management utilize information technology to increase
efficiencies and control costs. Our and our third-party vendors’ information technology systems may be vulnerable to a variety
of invasions, interruptions or malfunctions due to events beyond our or their control, including, but not limited to, natural
disasters, terrorist attacks, telecommunications failures, power outages, computer viruses, ransomware and malware, hardware
or software failures, cybersecurity incidents, hackers and other causes. Such invasions, interruptions or malfunctions could
negatively impact our business.
If we do not allocate and effectively manage the resources necessary to build and sustain the proper technology
infrastructure and to maintain and protect the related automated and manual control processes, or if one of our third-party
service providers fails to provide the services we require, we could be subject to billing and collection errors, business
disruptions or damage resulting from such events, particularly material security breaches and cybersecurity incidents.
Cyberattacks and other cyber incidents are occurring more frequently, are constantly evolving in nature, are becoming more
sophisticated and are being made by groups and individuals (including criminal hackers, hacktivists, state-sponsored
institutions, terrorist organizations and individuals or groups participating in organized crime) with a wide range of expertise
and motives (including monetization of corporate, payment or other internal or personal data, theft of trade secrets and
intellectual property for competitive advantage and leverage for political, social, economic and environmental reasons).
If any of our significant information technology systems suffers severe damage, disruption or shutdown, including by
malicious or unintentional actions of contractors or employees or by cyber or ransomware attacks, and our business continuity
plans do not effectively resolve the issues in a timely manner, our product sales, financial condition, results of operations and
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cash flows may be materially and adversely affected, and we could experience delays in reporting our financial results. In
addition, there is a risk of business interruption, litigation and reputational damage from leaks of confidential or personal
information. While we have insurance programs in place related to these matters, the potential liabilities associated with such
events, or those that could arise in the future, could be excluded from coverage or, if covered, could exceed the coverage
provided by such programs. Although we have not detected a material security breach or cybersecurity incident to date, we have
been the target of events of this nature and expect them to continue.
We also are subject to an evolving body of federal, state and foreign laws, regulations, guidelines and principles regarding
data privacy, data protection and data security. Several states as well as foreign governments have laws and regulations
regulating how businesses collect, use and protect personal information obtained from their data subjects, including the General
Data Protection Regulation, the E.U.’s retained version of General Data Protection Regulation, and the California Consumer
Privacy Act, as amended by the California Privacy Rights Act, and we could incur substantial fines, other penalties or litigation
related to violations of such laws and regulations.
Climate change, or legal or market measures to address climate change, may negatively affect our business, reputation and
operations.
Increasing levels of carbon dioxide and other greenhouse gases in the atmosphere may have an adverse impact on global
temperatures, weather patterns and the frequency and severity of extreme weather and natural disasters. If any of these climate
changes has a negative effect on agricultural productivity, we may be subject to decreased availability or less favorable pricing
for certain commodities that are necessary for our products, such as milk-based, whey-based and soy-based proteins, protein
blends, sweeteners and vitamin and mineral blends. In addition, increases in the frequency and severity of extreme weather and
natural disasters may result in damage and disruptions to our manufacturing operations and distribution channels or our third-
party contract manufacturers’ operations, particularly where a product is primarily sourced from a single location. Also, the
impacts of these climate changes may cause unpredictable water availability or exacerbate water scarcity. Water is critical to our
business, and the lack of available water of acceptable quality may lead to, among other things, adverse effects on our
operations. The increasing concern over climate change and related environmental sustainability matters also may result in
more federal, state, local and foreign legal requirements to reduce or mitigate the effects of greenhouse gases or conserve and
replenish water. If such laws are enacted, we may experience significant increases in our costs of operation and delivery.
Further, our business could be adversely affected if we are unable to effectively address increased concerns from the media,
stockholders and other stakeholders on climate change and related environmental sustainability and governance matters. In
addition, any failure to achieve goals we may set with respect to reducing our impact on the environment or perception of a
failure to act responsibly with respect to the environment can lead to adverse publicity, which could damage our reputation. As
a result, climate change could negatively affect our business, financial condition, results of operations and cash flows.
If we pursue acquisitions or other strategic transactions, we may not be able to successfully consummate favorable
transactions or successfully integrate acquired businesses.
From time to time, we may evaluate potential acquisitions or other strategic transactions. Evaluating potential transactions,
including divestitures, requires additional expenditures (including legal, accounting and due diligence expenses, higher
administrative costs to support the acquired entities and information technology, personnel and other integration expenses) and
may divert the attention of our management from day-to-day operating matters. Companies or operations we acquire or joint
ventures we enter into may not be profitable or may not achieve the anticipated profitability that justify our investments.
With respect to acquisitions, we may not be able to identify suitable candidates, consummate a transaction on terms that are
favorable to us or achieve expected returns and other benefits as a result of integration challenges. The successful integration of
acquisitions is complex and depends on our ability to manage the operations and personnel of the acquired businesses. Potential
difficulties we may encounter as part of the integration process include, but are not limited to, the following: employees may
voluntarily or involuntarily separate from employment with us or the acquired businesses because of the acquisitions; our
management may have its attention diverted while trying to integrate the acquired businesses; we may encounter obstacles
when incorporating the acquired businesses into our operations and management; we may be required to recognize impairment
charges; and integration may be more costly or more time consuming and complex or less effective than anticipated. With
respect to proposed divestitures of assets or businesses, we may encounter difficulty in finding acquirers or alternative exit
strategies on terms that are favorable to us, which could delay the accomplishment of our strategic objectives, or our divestiture
activities may require us to recognize impairment charges.
Our corporate development activities may present financial and operational risks and may have adverse effects on existing
business relationships with suppliers and customers. Future acquisitions also could result in potentially dilutive issuances of
equity securities, the incurrence of debt, contingent liabilities and depreciation and amortization expenses related to certain
tangible and intangible assets and increased operating expenses, all of which could, individually or collectively, adversely affect
our business, financial condition, results of operations and cash flows.
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Financial and Economic Risks
We have substantial debt, which could have a negative impact on our financing options and liquidity position and which
could adversely affect our business.
We have a significant amount of debt. As of September 30, 2024, we had $840.0 million in aggregate principal amount of
total debt. Additionally, our secured revolving credit facility has a remaining borrowing capacity of $250.0 million as of
September 30, 2024 (all of which would be secured when drawn).
Our overall leverage and the terms of our financing arrangements could:
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limit our ability to obtain additional financing in the future for working capital, capital expenditures or acquisitions, to
fund growth or for general corporate purposes, even when necessary to maintain adequate liquidity, particularly if any
ratings assigned to our debt securities by ratings organizations were revised downward;
•
make it more difficult for us to satisfy the terms of our obligations under the terms of our financing arrangements;
•
limit our ability to refinance our indebtedness on terms acceptable to us, or at all;
•
limit our flexibility to plan for and to adjust to changing business and market conditions in the industries in which we
operate and increase our vulnerability to general adverse economic and industry conditions;
•
require us to dedicate a substantial portion of our cash flow from operations to make interest and principal payments
on our debt, thereby limiting the availability of our cash flow to fund future investments, capital expenditures, working
capital, business activities and other general corporate requirements;
•
increase our vulnerability to adverse economic or industry conditions; and
•
subject us to higher levels of indebtedness than our competitors, which may cause a competitive disadvantage and may
reduce our flexibility in responding to increased competition.
Our ability to meet expenses and debt service obligations will depend on our future performance, which will be affected by
financial, business, economic and other factors, including the impact of pandemics and other outbreaks of contagious diseases,
potential changes in consumer and customer preferences and behaviors, the success of product and marketing innovation and
pressure from competitors. If we do not generate enough cash to pay our debt service obligations, we may be required to
refinance all or part of our existing debt, sell assets, borrow more money or issue additional equity.
Despite our level of indebtedness, we may be able to incur substantially more debt, which could further exacerbate the risks
related to our debt leverage, and we may in any event be required to maintain a minimum level of indebtedness.
We may be able to incur significant additional indebtedness in the future. Although the financing arrangements governing
our indebtedness contain restrictions on our ability to incur additional indebtedness, these restrictions are subject to a number of
qualifications and exceptions, and the additional indebtedness that may be incurred in compliance with these restrictions could
be substantial. These restrictions also may not prevent us from incurring certain obligations that may not constitute
indebtedness under the documents governing our indebtedness.
The agreements governing our debt contain various covenants that limit our ability to take certain actions and also require
us to meet financial maintenance tests, and failure to comply with these covenants could have a material adverse effect on
us.
Our financing arrangements contain restrictions, covenants and events of default that, among other things, require us to
satisfy certain financial tests and maintain certain financial ratios and restrict our ability to incur additional indebtedness and to
refinance our existing indebtedness. Financing arrangements which we enter into in the future could contain similar restrictions
and additionally could require us to comply with similar, new or additional financial tests or to maintain similar, new or
additional financial ratios. The terms of our financing arrangements, financing arrangements which we enter into in the future
and any future indebtedness may impose various restrictions and covenants on us that could limit our ability to respond to
market conditions, provide for capital investment needs or take advantage of business opportunities by limiting the amount of
additional borrowings we may incur. These restrictions include compliance with, or maintenance of, certain financial tests and
ratios and may limit or prohibit our ability to, among other things: borrow money or guarantee debt; create liens; pay dividends
on or redeem or repurchase stock or other securities; make investments and acquisitions; enter into, or permit to exist,
contractual limits on the ability of our subsidiaries to pay dividends to us; enter into new lines of business; enter into
transactions with affiliates; and sell assets or merge with other companies.
Various risks, uncertainties and events beyond our control, including the impact of pandemics and other outbreaks of
contagious diseases, could affect our ability to comply with these restrictions and covenants. Failure to comply with any of the
restrictions and covenants in our existing or future financing arrangements could result in a default under those arrangements
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and under other arrangements that may contain cross-default provisions. Our credit agreement contains a covenant that requires
us to maintain a total net leverage ratio (as defined in our credit agreement) not to exceed 6.00:1.00, as measured as of the last
day of each fiscal quarter. A default would permit lenders to accelerate the maturity of the debt under these arrangements and to
foreclose upon any collateral securing the debt. Under these circumstances, we might not have sufficient funds or other
resources to satisfy all of our obligations. In addition, the limitations imposed by financing agreements on our ability to incur
additional debt and to take other actions might significantly impair our ability to obtain other financing.
To service indebtedness and fund other cash needs, we will require a significant amount of cash. Our ability to generate
cash depends on many factors beyond our control.
Our ability to pay principal and interest on our debt obligations and to fund any planned capital expenditures and other cash
needs will depend in part upon the future financial and operating performance of our subsidiaries and upon our ability to renew
or refinance borrowings. Prevailing economic conditions and financial, business, our future financial and operating
performance, competitive, legislative, regulatory and other factors, many of which are beyond our control, including the impact
of pandemics and other outbreaks of contagious diseases, will affect our ability to make these payments.
If we are unable to make payments, refinance our debt or obtain new financing under these circumstances, we may
consider other options, including: sales of assets; sale of equity; reductions or delays of capital expenditures, strategic
acquisitions, investments and alliances; or negotiations with our lenders to restructure the applicable debt.
Our business may not generate sufficient cash flow from operations, and future borrowings may not be available to us in an
amount sufficient, to enable us to pay our indebtedness or to fund our other liquidity needs. We may need to refinance all or a
portion of our indebtedness on or before maturity. We may not be able to refinance any of our debt on commercially reasonable
terms, or at all.
Uncertain or unfavorable economic conditions, including during periods of high inflation, recessions or other economic
disruption, could limit consumer and customer demand for our products, increase our costs or otherwise adversely affect us.
The willingness of consumers to purchase our products depends in part on general or local economic conditions and
consumers’ discretionary spending habits. For instance in fiscal 2022, fiscal 2023 and fiscal 2024, the U.S. experienced
significantly heightened inflationary pressures. In periods of adverse or uncertain economic conditions, including during
periods of high inflation or recession concerns, consumers may purchase less of our products, purchase more value or private
label products or may forgo certain purchases altogether. In addition, our customers may seek to reduce their inventories in
response to those economic conditions. In those circumstances, we could experience a reduction in sales. Further, during
economic downturns, it may be more difficult to convince consumers to switch to, or continue to use, our brands or convince
new users to choose our brands without expensive sampling programs and price promotions. Also, as a result of economic
conditions, we may be unable to raise our prices sufficiently to protect profit margins. We experienced inflationary headwinds
across our business during fiscal 2022, fiscal 2023 and fiscal 2024, and we expect certain inflationary pressures to continue into
fiscal 2025. This trend could have a materially adverse impact in the future if inflation rates were to significantly exceed our
ability to achieve price increases or cost savings. Further, uncertain or unfavorable economic conditions, has and could continue
to negatively impact the financial stability of our customers or suppliers, which could lead to increased uncollectible
receivables or non-performance. Current global geopolitical tensions, including related to Ukraine and Israel and the Middle
East, may exacerbate any economic downturn and inflation. Any of these events could have an adverse effect on our business,
financial condition, results of operations and cash flows.
Increases in interest rates may negatively affect our earnings.
From time to time, we have debt outstanding with exposure to variable interest rates. As a result, we have in the past been
and may in the future be adversely effected by rising interest rates, which will increase the cost of servicing our financial
instruments with exposure to interest rate risk and could materially reduce our profitability and cash flows.
Our borrowing costs and access to capital and credit markets could be adversely affected by a downgrade or potential
downgrade of our credit ratings.
Rating agencies routinely evaluate us, and their ratings of our long-term and short-term debt are based upon a number of
factors, including our cash generating capability, levels of indebtedness, policies with respect to stockholder distributions and
financial strength generally, as well as factors beyond our control, such as the then-current state of the economy and our
industry generally. Any downgrade of our credit ratings by a credit rating agency, whether as a result of our actions or factors
which are beyond our control, can increase our future borrowing costs, impair our ability to access capital and credit markets on
terms commercially acceptable to us or at all and result in a reduction in our liquidity. Our borrowing costs and access to capital
markets also can be adversely affected if a credit rating agency announces that our ratings are under review for a potential
downgrade. An increase in our borrowing costs, limitations on our ability to access the global capital and credit markets or a
reduction in our liquidity can adversely affect our financial condition, results of operations and cash flows.
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U.S. and global capital and credit market issues, including those that have arisen as a result of heightened inflation and
recession or other economic concerns, could negatively affect our liquidity, increase our costs of borrowing and disrupt the
operations of our suppliers and customers.
U.S. and global credit markets have, from time to time, experienced significant dislocations and liquidity disruptions which
caused the spreads on prospective debt financings to widen considerably. These circumstances materially impacted liquidity in
the debt markets, making financing terms for borrowers less attractive and in certain cases resulted in the unavailability of
certain types of debt financing. In fiscal 2024, the U.S. experienced certain inflationary pressures and we expect certain
inflationary pressures to continue into fiscal 2025. This and other events affecting the credit markets also have had, and may in
the future have, an adverse effect on other financial markets in the U.S., which may make it more difficult or costly for us to
raise capital through the issuance of common stock or other equity securities or refinance our existing debt, sell our assets or
borrow money, if necessary. Our business also could be negatively impacted if our suppliers or customers experience
disruptions resulting from tighter capital and credit markets or a slowdown in the general economy. Any of these risks could
impair our ability to fund our operations or limit our ability to expand our business or increase our interest expense, which
could have a material adverse effect on our business, financial condition, results of operations and cash flows.
Impairment in the carrying value of intangible assets could negatively impact our financial condition and results of
operations. If our goodwill or other intangible assets become impaired, we will be required to record impairment charges,
which may be significant.
Our balance sheet includes intangible assets, including goodwill, trademarks, trade names, customer relationships and other
acquired intangibles. Goodwill is expected to contribute indefinitely to our cash flows and is not amortized. Our management
reviews it for impairment on an annual basis or whenever events or changes in circumstances indicate that its carrying value
may be impaired. Impairments to intangible assets may be caused by factors outside of our control, such as increasing
competitive pricing pressures, lower than expected revenue and profit growth rates, changes in industry earnings before interest,
taxes, depreciation and amortization (“EBITDA”) and revenue multiples, changes in discount rates based on changes in cost of
capital (interest rates, etc.) or the loss or bankruptcy of a significant customer. These factors, along with other internal and
external factors, could have a significant negative impact on our fair value determination, which could then result in a material
impairment charge recorded in our results of operations. No impairments were recorded in the years ended September 30, 2024,
2023 and 2022. However, we could have impairments in the future.
Unsuccessful implementation of business strategies to reduce costs, or unintended consequences of the implementation of
such strategies, may adversely affect our business, financial condition, results of operations and cash flows.
Many of our costs, such as freight, raw materials and energy, are outside of our control. Therefore, we must seek to reduce
costs in other areas, such as through operating efficiency. If we are not able to complete projects designed to reduce costs and
increase operating efficiency on time or within budget, or if the implementation of these projects results in unintended
consequences, such as business disruptions, distraction of management and employees or reduced productivity, our business,
financial condition, results of operations and cash flows may be adversely impacted. In addition, if the cost-saving initiatives
we have implemented, or any future cost-saving initiatives, do not generate the expected cost savings and synergies, our
business, financial condition, results of operations and cash flows may be adversely affected.
We have incurred, and we will continue to incur, additional fees, costs and expenses to create and maintain the corporate
infrastructure to operate as a public company, and we have and we will continue to experience increased ongoing costs and
expenses in connection with being a public company.
Prior to our IPO, our business had historically used some of Post’s corporate infrastructure and services to support our
business functions. The expenses related to establishing and maintaining this infrastructure had been spread across all of Post’s
businesses and charged to us on a cost-allocation basis. The services historically provided to us by Post included, but were not
limited to, finance, information technology, legal, human resources, quality, supply chain and purchasing functions. Following
our IPO, we continued to receive some of these services pursuant to a master services agreement with Post, and in connection
with the Spin-off, we, Post, Old BellRing and BellRing LLC entered into an amended and restated master services agreement,
which was further amended in fiscal 2023. Under the amended and restated master services agreement, Post continues to
provide certain of the above described services, and, in general, the services to be provided by Post will continue for the periods
specified in the amended and restated master services agreement, but not past March 2026, subject to any subsequent extension
or earlier termination as agreed to by the parties. There can be no assurance that all of the functions provided to us by Post
under the amended and restated master services agreement will be successfully executed by Post or that we will not have to
expend significant efforts or costs materially in excess of those estimated in the master services agreement. Any interruption in
these services could have a material adverse effect on our business, financial condition, results of operations and cash flows. In
addition, upon termination of the amended and restated master services agreement, we will need to perform these functions
ourselves or hire third parties to perform these functions on our behalf.
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Actual operating results may differ significantly from our guidance and our forward-looking statements.
From time to time, we release guidance regarding our future performance. This guidance, which consists of forward-
looking statements, is prepared by our management and is qualified by, and subject to, the assumptions and the other
information contained or referred to in such release and the factors described under “Cautionary Statement on Forward-Looking
Statements” in our current and periodic reports filed with the SEC. Our guidance is not prepared with a view toward
compliance with published guidelines of the American Institute of Certified Public Accountants, and neither our independent
registered public accounting firm nor any other independent expert or outside party has audited, reviewed, examined, compiled
or applied agreed upon procedures with respect to the guidance and, accordingly, no such person expresses any opinion or any
other form of assurance with respect thereto. The independent registered public accounting firm report included in this
document relates to our historical financial statements. It does not extend to any guidance and should not be read to do so.
Guidance is based upon a number of assumptions and estimates that, although presented with numerical specificity, are
inherently subject to business, economic and competitive uncertainties and contingencies, many of which are beyond our
control and are based upon specific assumptions with respect to future business decisions, some of which will change. We
generally state possible outcomes as high and low ranges which are intended to provide a sensitivity analysis as variables are
changed but are not intended to represent that actual results could not fall outside of the suggested ranges. The principal reason
that we release this data is to provide a basis for our management to discuss our business outlook with analysts and investors.
We do not accept any responsibility for any projections or reports published by any such persons.
Guidance is necessarily speculative in nature, and it can be expected that some or all of the assumptions of the guidance
furnished by us will not materialize or will vary significantly from actual results. Accordingly, our guidance is only an estimate
of what management believes is realizable as of the date of release. Actual results will vary from the guidance. Investors also
should recognize that the reliability of any forecasted financial data diminishes the farther in the future that the data is forecast.
In light of the foregoing, investors are urged to put the guidance in context and not to place undue reliance on it.
Any failure to successfully implement our operating strategy or the occurrence of any of the risks or uncertainties set forth
in this report could result in actual operating results being different than the guidance, and such differences may be adverse and
material.
Risks Related to Our Relationship with Post
We have overlapping directors and management with Post, which may lead to conflicting interests or the appearance of
conflicting interests.
Certain of our officers and directors, including Robert V. Vitale, who serves as Executive Chairman of our Board of
Directors, also serve as officers or directors of Post. Our officers and members of our Board of Directors have fiduciary duties
to our stockholders. Likewise, any such persons who serve in similar capacities at Post have fiduciary duties to Post’s
shareholders. Therefore, such persons may have conflicts of interest or the appearance of conflicts of interest with respect to
matters involving or affecting us and Post. In addition, some of our officers or members of our Board of Directors may own
equity or options to purchase equity in Post. Such ownership interests may create, or appear to create, conflicts of interest when
the applicable individuals are faced with decisions that could have different implications for us and Post. The appearance of
conflicts of interest created by such overlapping relationships also could impair the confidence of our investors.
Our certificate of incorporation could prevent us from benefiting from corporate opportunities that might otherwise have
been available to us.
Our certificate of incorporation includes certain provisions regulating and defining the conduct of our affairs to the extent
that they may involve Post and its directors, officers, employees, agents and affiliates and our rights, powers, duties and
liabilities and those of our directors, officers, managers, employees and agents in connection with our relationship with Post. In
general, and except as may be set forth in any agreement between us and Post, these provisions provide that Post and its
affiliates may carry on and conduct any business of any kind, nature or description, whether or not such business is competitive
with or in the same or similar lines of business as us; Post and its affiliates may do business with any of our customers, vendors
and lessors; and Post and its affiliates may make investments in any kind of property in which we may make investments. In
addition, these provisions provide that we renounce any interest or expectancy to participate in any business of Post or its
affiliates.
Moreover, our certificate of incorporation provides that we renounce any interests or expectancy in corporate opportunities
which become known to (i) any of our directors, officers, managers, employees or agents who also are directors, officers,
employees, agents or affiliates of Post or its affiliates (except that we and our subsidiaries are not deemed affiliates of Post or its
affiliates for the purposes of the provision) or (ii) Post or its affiliates. Generally, neither Post nor our directors, officers,
managers, employees or agents who also are directors, officers, employees, agents or affiliates of Post or its affiliates will be
liable to us or our stockholders for breach of any fiduciary duty solely by reason of the fact that any such person pursues or
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acquires any corporate opportunity for the account of Post or its affiliates, directs, recommends or transfers such corporate
opportunity to Post or its affiliates or does not offer or communicate information regarding such corporate opportunity to us
because such person has directed or intends to direct such opportunity to Post or one of its affiliates. This renunciation does not
extend to corporate opportunities expressly offered to one of our directors, officers, managers, employees or agents, solely in
his or her capacity as a director, officer, manager, employee or agent of us.
These provisions in our certificate of incorporation will cease to apply at such time as none of the directors, officers,
employees, agents or affiliates of Post serve as our directors, officers, managers, employees or agents. The corporate
opportunity provision may exacerbate conflicts of interest between Post and us because the provision effectively permits one of
our directors, officers, managers, employees or agents who also serves as a director, officer, employee, agent or affiliate of Post
or its affiliates to choose to direct a corporate opportunity to Post or its affiliates instead of to us.
We may be responsible for U.S. federal income tax liabilities that relate to the Spin-off.
The completion of the Spin-off by Post was conditioned on the receipt by Post of an opinion of a nationally recognized
accounting firm or law firm (the “distribution tax counsel” and, together with BellRing tax counsel, “tax counsel”) to the effect
that the Separation, together with certain contributions made by Post to us, should qualify as a tax-free “reorganization” within
the meaning of Sections 368(a) and 355 of the Internal Revenue Code (the “Code”) and the Distribution should qualify as a tax-
free distribution eligible for nonrecognition within the meaning of Sections 355 and 361 of the Code. The completion of the
Spin-off was also conditioned on the receipt by us of an opinion of BellRing’s tax counsel to the effect that the merger of
Merger Sub with and into Old BellRing qualified as a “reorganization” within the meaning of Section 368(a) of the Code or,
alternatively, as a transaction qualifying for nonrecognition of gain and loss under Section 351 of the Code. An opinion of tax
counsel is not binding on the U.S. Internal Revenue Service (the “IRS”). Accordingly, the IRS may reach conclusions with
respect to the distribution that are different from the conclusions reached in the opinions, and any such differing conclusions
may result in U.S. federal income tax liability. The opinions will be based on certain factual statements and representations,
which, if incomplete or untrue in any material respect, could alter tax counsel’s conclusions. We are not aware of any facts or
circumstances that would cause any such factual statements or the opinion of tax counsel to be incomplete or untrue.
If all or a portion of the Spin-off does not qualify as a tax-free transaction for any reason, including because any of the
factual statements or representations in the legal opinions are incomplete or untrue, Post may recognize a substantial gain
for U.S. federal income tax purposes, and we may incur indemnification or other liabilities to Post as a result.
Even if the Distribution otherwise qualifies as a tax-free transaction for U.S. federal income tax purposes, the Distribution
will be taxable to Post (but not to Post shareholders) pursuant to Section 355(e) of the Code if there are (or have been) one or
more acquisitions (including issuances), directly or indirectly (including through acquisitions of such stock after the completion
of the Transactions), of our stock or the stock of Post, representing 50 percent or more, measured by vote or value, of the stock
of any such corporation and the acquisition or acquisitions are deemed to be part of a plan or series of related transactions that
include the Distribution. The process for determining whether an acquisition is part of a plan under these rules is complex,
inherently factual in nature, and subject to a comprehensive analysis of the facts and circumstances of the particular case. In
general, any acquisition of our common stock within two years before or after the Distribution (with exceptions, including
public trading by less-than-5 percent stockholders and certain compensatory stock issuances) generally will be presumed to be
part of such a plan unless that presumption is rebutted. The resulting tax liability would be substantial. Pursuant to a tax matters
agreement with Post, we have agreed to indemnify Post for any tax liabilities resulting from such transactions or other actions
we take, and Post has agreed to indemnify us for any tax liabilities resulting from transactions entered into by Post.
In addition, pursuant to the tax matters agreement, if and to the extent the Distribution does not qualify as a tax-free
transaction, such failure to qualify as a tax-free transaction gives rise to adjustments to the tax basis of assets held by us and our
subsidiaries, and we are not required to indemnify Post for any tax liabilities resulting from such failure to qualify as a tax-free
transaction, then Post will be entitled to periodic payments from us equal to 85% of the tax savings arising from the aggregate
increase to the tax basis of assets held by us and our subsidiaries resulting from such failure and Post and we will negotiate in
good faith the terms of a tax receivable agreement to govern the calculation of such payments applying the principles of, and
adhering as closely as practicable to, the existing tax receivable agreement between Post and BellRing. Payments under such
tax receivable agreement may be substantial, and in certain cases may be accelerated or significantly exceed the actual benefits
we realize in respect of the tax attributes subject to the tax receivable agreement.
Legal and Regulatory Risks
Violations of laws or regulations by us or our third-party contract manufacturers, as well as new laws or regulations or
changes to existing laws or regulations, could adversely affect our business.
Our business is subject to a variety of laws and regulations administered by federal, state and local government authorities
in the U.S., as well as government authorities outside of the U.S., including requirements related to food safety, quality,
manufacturing, processing, storage, marketing, advertising, labeling, distribution and worker health and workplace safety. Our
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activities, both inside and outside of the U.S., are subject to extensive regulation. In the U.S., we are regulated by, and our
activities are affected by, among other federal, state and local authorities and regulations, the FDA, the USDA, the Federal
Trade Commission, the Occupational Safety and Health Administration and Proposition 65. In Europe, we are regulated by,
among other authorities, the U.K.’s Food Standards Agency, Health and Safety Executive, Environment Agency, Environmental
Health, the Information Commissioners Office and the Trading Standards Office and their equivalents in E.U. member states.
We also are regulated by similar authorities elsewhere in the world where our products are distributed.
Governmental regulations also affect taxes and levies, tariffs, import and export restrictions, healthcare costs, energy usage,
data privacy and immigration and labor issues, any or all of which may have a direct or indirect effect on our business or the
businesses of our customers, suppliers or third-party contract manufacturers. In addition, we could be the target of claims
relating to alleged false or deceptive advertising under federal, state and foreign laws and regulations. We also may be impacted
by changes to administrative policies, such as business restrictions, tariffs and trade agreements, in markets in which we
manufacture, sell or distribute our products.
The impact of current laws and regulations, changes in, or changes in interpretations of, these laws or regulations or the
introduction of new laws or regulations could increase the costs of doing business for us or our customers or suppliers or third-
party contract manufacturers, causing our business, financial condition, results of operations and cash flows to be adversely
affected. Further, if we are found to be out of compliance with applicable laws and regulations in these areas, we could be
subject to civil remedies, including fines, revocations of required licenses, detention, seizure, injunctions or recalls, as well as
potential criminal sanctions, any or all of which could have a material adverse effect on our business, financial condition,
results of operations and cash flows.
It also is possible that federal, state, local or foreign enforcement authorities might take regulatory or enforcement action,
which could result in significant fines or penalties, revocations of required licenses or injunctions, as well as potential criminal
sanctions. If we are found to be significantly out of compliance, an enforcement authority could issue a warning letter and/or
institute enforcement actions that could result in additional costs, substantial delays in production or even a temporary
shutdown in manufacturing and product sales. Also, we may have to recall product or otherwise remove product from the
market, and temporarily cease its manufacture and distribution, which would increase our costs and reduce our revenues. Any
product liability claims resulting from the failure to comply with applicable laws and regulations would be expensive to defend
and could result in substantial damage awards against us or harm our reputation. Any of these events would negatively impact
our revenues and costs of operations.
We also may be impacted by changes to administrative policies, such as business restrictions, tariffs and trade agreements,
in markets in which we or our third-party contract manufacturers manufacture, sell or distribute our products.
Certain of our products are subject to a higher level of regulatory scrutiny, resulting in increased costs of operations and the
potential for delays in product sales.
Certain of our products are regulated by the FDA as dietary supplements, which are subject to FDA regulations and levels
of regulatory scrutiny different from those applicable to conventional food. Internationally, the convenient nutrition category is
regulated as food and dietary supplements. Such heightened regulatory scrutiny results in increased costs of operations and the
potential for delays in product sales. In addition, there is some risk that product classifications could be changed by the
regulators, which could result in significant fines, penalties, discontinued distribution and relabeling costs. Any of these events
would negatively impact our revenues and costs of operations.
Pending and future litigation and claims may impair our reputation or lead us to incur significant costs.
We are, or may become, party to various lawsuits and claims arising in the normal course of business, which may include
lawsuits or claims relating to contracts, third-party contract manufacturers, intellectual property infringement, product recalls,
product liability, false or deceptive advertising, employment matters, environmental matters or other aspects of our business.
Lawsuits filed against food and beverage companies alleging deceptive advertising and labeling continue to increase. In
addition, actions we have taken or may take, or decisions we have made or may make, may result in legal claims or litigation
against us. Negative publicity resulting from allegations made in lawsuits or claims asserted against us, whether or not valid,
may adversely affect our reputation. In addition, we may be required to pay damage awards or settlements, become subject to
injunctions or other equitable remedies, be required to modify our business processes, practices or products or be required to
stop selling certain of our products. For instance, one of our operating subsidiaries, Premier Nutrition, LLC, is a defendant in
several class action lawsuits related to its Joint Juice product, which it discontinued in the first quarter of fiscal 2023. At
September 30, 2024, we had accrued $21.0 million related to these matters. In addition, intellectual property infringement
litigation or claims could cause us to cease making, licensing or using products that incorporate the challenged intellectual
property, require us to redesign or rebrand our products or packaging, if feasible, or require us to enter into royalty or licensing
agreements in order to obtain the right to use a third party’s intellectual property. Any or all of these consequences could have a
material adverse effect on our financial condition, results of operations and cash flows. The outcome of litigation is often
27
difficult to predict, and the outcome of pending or future litigation may have a material adverse effect on our business, financial
condition, results of operations and cash flows.
Although we have various insurance programs in place, the potential liabilities associated with lawsuits and claims could
be excluded from coverage or, if covered, could exceed the coverage provided by such programs. In addition, insurance carriers
may seek to rescind or deny coverage with respect to pending or future claims or lawsuits. If we do not have sufficient coverage
under our policies, or if coverage is denied, we may be required to make material payments to settle litigation or satisfy any
judgment. Any of these consequences could have a material adverse effect on our business, financial condition, results of
operations and cash flows.
We are subject to environmental laws and regulations that can impose significant costs and expose us to potential financial
liabilities.
We and our contract manufacturers and other vendors and suppliers are subject to extensive federal, state, local and foreign
laws and regulations relating to the protection of human health and the environment, including those limiting the discharge and
release of pollutants into the environment and those regulating the transport, storage, disposal and remediation of, and exposure
to, solid and hazardous wastes. Certain environmental laws and regulations can impose joint and several liability without regard
to fault on responsible parties, including past and present owners and operators of sites, related to cleaning up sites at which
hazardous materials were disposed of or released. Failure to comply with environmental laws and regulations could result in
severe fines and penalties by governments or courts of law. In addition, future laws may more stringently regulate the emission
of greenhouse gases, particularly carbon dioxide and methane.
Future events, such as new or more stringent environmental laws and regulations, new environmental claims, the discovery
of currently unknown environmental conditions requiring responsive action or more vigorous interpretations or enforcement of
existing environmental laws and regulations, might require us to incur additional costs that could have a material adverse effect
on our business, financial condition, results of operations and cash flows.
Risks Related to Ownership of Our Common Stock
The market price and trading volume of our common stock may be volatile.
The market price of our common stock could fluctuate significantly for many reasons, including in response to the risks
and uncertainties discussed in this report or for reasons unrelated to our specific performance, such as reports by industry
analysts, our failure to meet analysts’ earnings estimates, investor perceptions, or negative developments relating to our
customers, competitors or suppliers, as well as general economic and industry conditions. Furthermore, the stock markets have
experienced price and volume fluctuations that have affected and continue to affect the market prices of equity securities of
many companies. These fluctuations often have been unrelated or disproportionate to the operating performance of those
companies.
We may not declare or pay any dividends on our common stock for the foreseeable future.
We may retain future earnings, if any, for future operations, expansion and debt repayment. We have not paid cash
dividends to date and have no current plans to pay any cash dividends for the foreseeable future. Consequently, our
stockholders must rely on sales of their shares of our common stock after price appreciation, which may never occur, as the
only way to realize any future gains on their investment. Any future determination to pay dividends, including timing and
amount, will be at the discretion of our Board of Directors and subject to, among other things, our compliance with applicable
law, and depend on, among other things, our results of operations, financial condition, level of indebtedness, capital
requirements, contractual restrictions, restrictions in our debt agreements, business prospects and other factors that our Board of
Directors may deem relevant. Our ability to pay dividends depends on our receipt of cash dividends from our operating
subsidiaries and our ability to pay dividends may be further restricted as a result of the laws of our subsidiaries’ jurisdictions of
organization or their agreements, including agreements governing indebtedness.
Our certificate of incorporation and bylaws and provisions of Delaware law may discourage or prevent strategic
transactions, including a takeover of the Company, even if such a transaction would be beneficial to our stockholders.
Provisions contained in our certificate of incorporation and bylaws and provisions of the General Corporation Law of the
State of Delaware (the “DGCL”) could delay or prevent a third party from entering into a strategic transaction with us, as
applicable, even if such transaction would benefit our stockholders. For example, our certificate of incorporation and bylaws:
•
divide the members of the Board of Directors into three classes with staggered three-year terms, which may delay or
prevent a change of our management or a change on control;
•
authorize the issuance of “blank-check” preferred stock that could be issued by us upon approval of the Board of
Directors to increase the number of outstanding shares of capital stock, making a takeover more difficult and
expensive;
28
•
provide that directors may be removed from office only for cause and that any vacancy or newly created directorships
on the Board of Directors may only be filled by a majority of directors then in office, which may make it difficult for
other stockholders to reconstitute the Board of Directors;
•
provide that special meetings of the stockholders may be called only upon the request of a majority of the Board of
Directors or by the chairman of the Board of Directors or the chief executive officer;
•
prohibit stockholder action by written consent and require that any action to be taken by stockholders be taken at an
annual or special meeting of stockholders; and
•
require advance notice to be given by stockholders for any stockholder proposals or director nominees.
These restrictions and provisions could keep us from pursuing relationships with strategic partners and from raising
additional capital, which could impede our ability to expand our business and strengthen our competitive position. These
restrictions could also limit stockholder value by impeding a sale of the Company.
Our certificate of incorporation provides that the Court of Chancery of the State of Delaware (the “Court of Chancery”) (or,
if the Court of Chancery does not have subject matter jurisdiction, the federal district court for the State of Delaware) is the
exclusive forum for the following types of actions or proceedings under Delaware statutory or common law:
•
any derivative action or proceeding brought on our behalf;
•
any action asserting a breach of fiduciary duty;
•
any action asserting a claim against us arising pursuant to the DGCL; and
•
any action asserting a claim against us that is governed by the internal affairs doctrine.
This provision would not apply to suits brought to enforce a duty or liability created by the Exchange Act, for which the
U.S. federal courts have exclusive jurisdiction. Section 22 of the Securities Act creates concurrent jurisdiction for federal and
state courts over all Securities Act actions. Accordingly, both state and federal courts have jurisdiction to entertain such claims.
However, our certificate of incorporation also provides that U.S. federal courts will, to the fullest extent permitted by law, be
the sole and exclusive forum for the resolution of any complaint asserting a cause of action or proceeding arising under the
Securities Act. While the Delaware courts have determined that choice of forum provisions are facially valid, a stockholder may
nevertheless seek to bring a claim in a venue other than that designated in the Company’s exclusive forum provision. Although
our certificate of incorporation contains the exclusive forum provision described above, it is possible that a court could find that
such a provision is inapplicable for a particular claim or action or that such provision is unenforceable. The exclusive forum
provision shall not relieve us of our duties to comply with the federal securities laws and the rules and regulations thereunder,
and our stockholders will not be deemed to have waived our compliance with these laws, rules and regulations.
This choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable
for disputes with the Company or its directors, officers, or other employees and may discourage these types of lawsuits.
Alternatively, if a court were to find the choice of forum provision contained in our certificate of incorporation to be
inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other
jurisdictions.
General Risks
Changes in tax laws may adversely affect us, and the IRS or a court may disagree with our tax positions, which may result
in adverse effects on our business, financial condition, results of operations and cash flows.
There can be no assurance that future tax law changes will not increase the rate of the corporate income tax significantly;
impose new limitations on deductions, credits or other tax benefits; or make other changes that may adversely affect the
performance of an investment in our stock. Furthermore, there is no assurance that the IRS or a court will agree with the
positions taken by us, in which case tax penalties and interest may be imposed that could adversely affect our business,
financial condition, results of operations and cash flows.
We may not be able to operate successfully if we are unable to recruit, hire, retain and develop key personnel and a qualified
and diverse workforce. In addition, temporary workforce disruptions or the inability of our employees to safely perform their
jobs for any reason, including as a result of illness, could adversely impact our business, financial condition, results of
operations and cash flows.
We depend upon the skills, working relationships and continued services of key personnel, including our senior
management team. In addition, our ability to achieve our operating goals depends upon our ability to recruit, hire, retain and
develop qualified and diverse personnel to operate and expand our business. We compete with other companies both within and
outside of our industry for talented personnel. If we lose key personnel, or one or more members of our senior management
29
team, and we fail to develop adequate succession plans, or if we fail to hire, retain and develop a sufficient number of qualified
and diverse employees to operate and expand our business, our business, financial condition, results of operations and cash
flows could be harmed.
Our business is dependent upon our employees being able to safely perform their jobs. If we experience workforce
disruptions or periods where our employees are unable to safely perform their jobs for any reason, including as a result of
illness or restrictions put in place by governmental authorities, our business, financial condition, results of operations and cash
flows could be adversely affected.
Increases in labor-related costs, including costs of medical and other employee health and welfare benefits, may reduce our
profitability.
Inflationary pressures and shortages in the labor market have increased, and could continue to increase, our labor costs,
which could negatively impact our profitability. With approximately 485 employees as of November 1, 2024, our profitability
may be substantially affected by costs of medical and other health and welfare benefits for these employees. Although we try to
control these costs, they can vary because of changes in healthcare laws and claims experience, which have the potential to
increase the cost of providing medical and other employee health and welfare benefits. Any substantial increase could
negatively affect our profitability.
If we are unable to continue to satisfy the requirements of Section 404 of the Sarbanes-Oxley Act, or our internal control
over financial reporting is not effective, the reliability of our financial statements may be questioned, and the price of our
common stock could suffer.
Section 404 of the Sarbanes-Oxley Act of 2002 (“SOX”) requires any company subject to the reporting requirements of the
U.S. securities laws to do a comprehensive evaluation of its and its consolidated subsidiaries’ internal control over financial
reporting. To comply with this statute, we are required to document and test our internal control procedures, our management is
required to assess and issue a report concerning our internal control over financial reporting and our independent registered
public accounting firm is required to issue an opinion on its audit of our internal control over financial reporting.
The rules governing the standards that must be met for management to assess our internal control over financial reporting
are complex and require significant documentation, testing and possible remediation to meet the detailed standards under the
rules. During the course of its testing, our management may identify material weaknesses or significant deficiencies which may
not be remedied in time to meet the deadlines imposed by SOX and SEC rules. If our management cannot favorably assess the
effectiveness of our internal control over financial reporting or our independent registered public accounting firm identifies
material weaknesses in our internal controls, investor confidence in our financial results may weaken and the price of our
common stock may suffer. In addition, in the event we do not maintain effective internal control over financial reporting, we
might fail to timely prevent or detect potential financial misstatements. As of September 30, 2024, management determined that
our internal control over financial reporting was effective.
Actions of stockholders could cause us to incur substantial costs, divert management’s attention and resources and have an
adverse effect on our business.
We may, from time to time, be subject to proposals and other requests from stockholders urging us to take certain corporate
actions, including proposals seeking to influence our corporate policies or effect a change in our management. In the event of
such stockholder proposals, particularly with respect to matters which our management and Board of Directors, in exercising
their fiduciary duties, disagree with or have determined not to pursue, our business could be adversely affected because
responding to actions and requests of stockholders can be costly and time-consuming, disrupting our operations and diverting
the attention of management and our employees. Additionally, perceived uncertainties as to our future direction may result in
the loss of potential business opportunities and may make it more difficult to attract and retain qualified personnel, business
partners and customers.
ITEM 1B.
UNRESOLVED STAFF COMMENTS
None.
ITEM 1C. CYBERSECURITY
Overview and Leadership
Our enterprise risk management framework addresses cybersecurity risk along with other risks as part of our overall
enterprise risk management process. We maintain a comprehensive information technology, data governance and cybersecurity
program that leverages people, processes and technology to support our information technology systems and detect, identify,
prevent, defend against and mitigate information technology and data security risks. Our cybersecurity program is aligned with
30
the National Institute of Standards and Technology Cybersecurity Framework. This framework encompasses key processes,
policies and controls to ensure protection, detection, identification, response and recovery capabilities across our organization.
Our information security program also addresses cybersecurity risks associated with our use of third-party service
providers, including cybersecurity vendors, cybersecurity software and hardware providers, other vendors and customers,
service providers and other parties with access to our systems and data as well as the systems of third parties that could
adversely affect our operations or business in the event of a cybersecurity incident affecting those third-party systems. We use
systems and processes designed to assess, identify and reduce the potential impact of a cybersecurity incident at any of our
third-party service providers. We assess information security controls of certain of our third-party service providers as part of
our third-party information technology risk due diligence, and we conduct third-party vulnerability analyses regularly.
Information security is integral to our information technology strategy, with accountability embedded at all organizational
levels, including our operations, management and Board of Directors. Key elements include:
•
Managed Detection and Response (“MDR”) & Security Operations Center (“SOC”): Our operations team employs
MDR and a SOC for round-the-clock monitoring of cyber threats and vulnerabilities.
•
Vulnerability Management: We maintain technology solutions for cybersecurity prevention and defense, including
outside firewalls, multi-factor authentication systems, separate intrusion prevention and detection systems, anti-virus
and anti-malware products and remote access controls. Continuous vulnerability scoring helps us address emerging
risks objectively and proactively.
•
Incident Response: Security incidents are managed through established protocols, with escalations to senior
management to assess materiality and disclosure requirements. Our information security team develops, implements
and regularly tests incident response and information recovery plans designed to assess and respond to cybersecurity
threats and incidents.
•
Board Oversight: The Audit Committee of our Board of Directors is responsible for the oversight of cybersecurity
risks. It receives regular updates and presentations on our cybersecurity environment, including strategies, processes
and policies, cybersecurity incidents, risks and threats, cybersecurity projects we have implemented and plan to
implement and other cybersecurity developments and industry trends. These updates are led by our Chief Information
Officer, a seasoned information technology professional with over 20 years of experience, supported by a dedicated
security team. The chair of the Audit Committee reports to the full Board of Directors after each meeting.
•
Risk Management: Cybersecurity risks are either mitigated or documented in a risk register for non-material risks.
Non-material risks are reviewed periodically to ensure continuous improvement and timely resolution. In addition, we
maintain insurance to help reduce our exposure from potential losses should a cybersecurity incident arise.
Use of Third Parties
We collaborate with, and intend to continue to collaborate with, nationally recognized third-party experts for specialized
security functions in rapidly evolving areas. This partnership approach enables us to leverage advanced expertise in threat
identification, penetration testing, tabletop exercises, maturity assessments, training, awareness and incident response.
We routinely evaluate third-party certifications (such as SOC and Insurance Services Office reports) for applications within
the scope of our financial audits, supplementing these with bridge letters and internal controls when necessary. Additionally, our
security team uses advanced software to assess third-party security postures, providing maturity scores that inform risk
management and foster continuous improvement throughout our partnerships.
Training and Preparedness
The Company mandates ongoing cybersecurity training for all employees, covering a broad range of relevant topics. High-
risk roles receive additional specialized training. We conduct regular phishing and social engineering simulations, with
organization-wide reporting of results. Leadership teams also participate in annual tabletop exercises (simulated security
incidents) to reinforce preparedness and refine our response plan. In addition, we maintain cybersecurity insurance to provide
an added layer of protection and support in the event of a significant cybersecurity incident.
Effect of Cybersecurity Events
While no previous cybersecurity incidents have materially affected the Company, a cybersecurity incident could have a
material effect on our results of operations and financial condition. As described above under “Item 1A-Risk Factors -
Technology failures, cybersecurity incidents and corruption of our data privacy protections could disrupt our operations and
negatively impact our business,” a material cybersecurity incident could disrupt our business, lead to the loss of data or cause us
to suffer financial and/or reputational damage, in addition to litigation or remediation costs or penalties.
31
ITEM 2.
PROPERTIES
Post provides us space for our principal executive offices in St. Louis, Missouri pursuant to the master services agreement
among BellRing Brands, Inc., BellRing LLC, BellRing Intermediate Holdings, Inc. and Post. Our other administrative offices,
as well as the warehousing, distribution and research and development facilities of our principal operations, are described
below. While our products are primarily manufactured by third-party contract manufacturers, we also own one manufacturing
facility. For additional information regarding our third-party manufacturing network, see “Business - Supply Chain” in Item 1
of this report.
We lease a research and development facility and administrative office in Emeryville, California. We also lease
administrative offices in Dallas, Texas; Rogers, Arkansas; Munich, Germany and Worb, Switzerland. Through third-party
logistics firms, we lease warehouse space in Tagelswangen, Switzerland and a distribution center with warehouse space in
Kleve, Germany. We also manufacture protein and energy bars and gels and conduct research and development through an
owned facility in Voerde, Germany. Management believes our facilities generally are in good operating condition. In
conjunction with our arrangements with third-party contract manufacturers, management believes, taken as a whole, our
facilities generally are suitable, adequate and of sufficient capacity for our current operations. See “Risk Factors” included in
Item 1A of this report for more information about our supply chain and related risks.
ITEM 3.
LEGAL PROCEEDINGS
The information required under this Item 3 is set forth in Note 14 within “Notes to Consolidated Financial Statements”
included in Item 8 of this report and is incorporated herein by this reference. For disclosure of environmental proceedings with
a governmental entity as a party pursuant to Item 103(c)(3)(iii) of Regulation S-K, the Company has elected to disclose matters
where the Company reasonably believes such proceeding would result in monetary sanctions, exclusive of interest and costs, of
$1.0 million or more. Applying this threshold, there are no such environmental proceedings pending as of the filing date of this
report or that were resolved during the three months ended September 30, 2024.
ITEM 4.
MINE SAFETY DISCLOSURES
Not applicable.
32
PART II
ITEM 5.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND
ISSUER PURCHASES OF EQUITY SECURITIES
Market for Common Stock
Prior to March 10, 2022, our Class A common stock, $0.01 par value per share (“Old BellRing Class A Common Stock”)
was traded on the New York Stock Exchange (the “NYSE”) under the trading symbol “BRBR.” On March 10, 2022, the
outstanding shares of our Old BellRing Class A Common Stock were converted into BellRing common stock, $0.01 par value
per share (“BellRing Common Stock”) and continued to trade on the NYSE under the trading symbol “BRBR”. For additional
information, refer to Note 1 within “Notes to Consolidated Financial Statements” in Item 8 of this report. There were
approximately 4,013 stockholders of record of our BellRing Common Stock as of November 12, 2024.
Dividends
We may not pay cash dividends on our BellRing Common Stock for the foreseeable future. Any future determination to
pay dividends, and the amount and timing of any such payment, will be at the discretion of our Board of Directors and subject
to, among other things, our compliance with applicable law, and depending on, among other things, our results of operations,
financial condition, level of indebtedness, capital requirements, contractual restrictions, restrictions in our debt agreements,
business prospects, our cash flow and liquidity position and other factors that our Board of Directors may deem relevant.
Equity Compensation Plan Information
The information required under this Item 5 concerning equity compensation plan information is set out below under Item
12 of this report and is incorporated herein by this reference.
Issuer Purchases of Equity Securities
The following table sets forth information with respect to repurchases of shares of our BellRing Common Stock during the
three months ended September 30, 2024 and our BellRing Common Stock repurchase authorization.
Period
Total
Number of
Shares
Purchased
Average
Price Paid
per Share
(a)
Total Number of Shares
Purchased as Part of
Publicly Announced Plans
or Programs (b)
Approximate Dollar Value of
Shares that May Yet be
Purchased Under the Plans
or Programs (b)
July 1, 2024 - July 31, 2024
263,686 $
56.89
263,686
$200,576,561
August 1, 2024 - August 31, 2024
382,238 $
54.72
382,238
$179,660,627
September 1, 2024 - September 30, 2024
77,821 $
58.98
77,821
$175,071,070
Total
723,745 $
55.97
723,745
$175,071,070
(a) Does not include broker’s commissions or accrued excise tax.
(b) On February 29, 2024, our Board of Directors approved a $300,000,000 repurchase authorization with respect to shares of BellRing
Common Stock (the “Authorization”). The Authorization was effective on March 11, 2024 and has an expiration date of March 11, 2026.
Repurchases may be made from time to time in the open market, private purchases, through forward, derivative, accelerated repurchase
or automatic purchase transactions, or otherwise.
33
Performance Graph
The following performance graph compares the changes for the period beginning October 17, 2019, the first day our
common stock began trading on the NYSE, through September 30, 2024 in the cumulative total value of $100 hypothetically
invested in each of (i) our publicly traded common stock (which included Old BellRing Class A Common Stock prior to March
10, 2022 and BellRing Common Stock subsequent to March 10, 2022); (ii) the Russell 1000 index; (iii) the Russell 2000 index;
and (iv) the S&P 1500 Packaged Foods & Meats Index.
In June 2024, our publicly traded common stock became a component of the Russell 1000 index. Previously, our publicly
traded common stock was a component of the Russell 2000 index. As such, the Russell 1000 index has been deemed to be the
more comparable index going forward.
* $100 invested on October 17, 2019 in stock or index. The cumulative total return of our publicly traded common stock
includes the reinvestment of $2.97 in cash paid to holders of our Old BellRing Class A Common Stock in addition to each share
of Old BellRing Class A Common Stock converted into BellRing Common Stock on March 10, 2022. For additional
information, refer to Note 1 within “Notes to Consolidated Financial Statements” in Item 8 of this report.
Performance Graph Data
BellRing Brands,
Inc. ($)
Russell 1000 Index
($)
Russell 2000 Index
($)
S&P 1500 Packaged
Foods & Meats
Index ($)
10/17/2019
100.00
100.00
100.00
100.00
9/30/2020
125.70
115.12
99.13
106.21
9/30/2021
186.36
150.74
146.36
112.18
9/30/2022
139.27
124.77
111.93
118.20
9/29/2023
278.62
151.19
121.86
121.02
9/30/2024
410.32
205.10
154.45
134.16
The stock price performance included in this graph is not necessarily indicative of future stock price performance.
This performance graph shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), or subject to the liabilities of the Exchange Act, nor shall it be incorporated by reference into
any of our filings under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by
specific reference in such filing.
ITEM 6.
[RESERVED]
34
ITEM 7.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
The following discussion summarizes the significant factors affecting the consolidated operating results, financial
condition, liquidity and capital resources of BellRing Brands, Inc. (formerly known as BellRing Distribution, LLC)
(“BellRing”) and its consolidated subsidiaries. This discussion should be read in conjunction with the financial statements
under Item 8 of this report and the “Cautionary Statement on Forward-Looking Statements” on page 1.
The following should be read in conjunction with the discussion and analysis of our fiscal 2023 results compared to our
fiscal 2022 results, including any related discussion of fiscal 2022 results and activity, which can be found in Item 7 under the
title “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form
10-K for the year ended September 30, 2023, and such discussion and analysis is incorporated by reference herein.
OVERVIEW
On October 21, 2019, BellRing Intermediate Holdings, Inc. (formerly known as BellRing Brands, Inc.) (“Old BellRing”)
closed its initial public offering (the “IPO”) of 39.4 million shares of its Class A common stock, $0.01 par value per share (“Old
BellRing Class A Common Stock”) and contributed the net proceeds from the IPO to BellRing Brands, LLC, a Delaware
limited liability company and subsidiary of Old BellRing (“BellRing LLC”), in exchange for 39.4 million BellRing LLC non-
voting membership units (the “BellRing LLC units”). As a result of the IPO and certain other transactions completed in
connection with the IPO (the “formation transactions”), BellRing LLC became the holding company for the active nutrition
business of Post Holdings, Inc. (“Post”). Old BellRing, as a holding company, had no material assets other than its ownership of
BellRing LLC units and its indirect interests in the subsidiaries of BellRing LLC and had no independent means of generating
revenue or cash flow. The members of BellRing LLC were Post and Old BellRing.
During the second quarter of fiscal 2022, Post completed its distribution of 80.1% of its ownership interest in BellRing to
Post’s shareholders. On March 9, 2022, pursuant to the Transaction Agreement and Plan of Merger, dated as of October 26,
2021 (as amended by Amendment No. 1 to the Transaction Agreement and Plan of Merger, dated as of February 28, 2022, the
“Transaction Agreement”), by and among Post, Old BellRing, BellRing and BellRing Merger Sub Corporation, a wholly-owned
subsidiary of BellRing (“BellRing Merger Sub”), Post contributed its share of Old BellRing Class B common stock, $0.01 par
value per share (“Old BellRing Class B Common Stock”), all of its BellRing LLC units and $550.4 million of cash to BellRing
(collectively, the “Contribution”) in exchange for certain limited liability company interests of BellRing (prior to the conversion
of BellRing into a Delaware corporation) and the right to receive $840.0 million in aggregate principal amount of BellRing’s
7.00% senior notes maturing in 2030 (the “7.00% Senior Notes”).
On March 10, 2022, BellRing converted into a Delaware corporation and changed its name to “BellRing Brands, Inc.”, and
Post distributed an aggregate of 78.1 million, or 80.1%, of its shares of BellRing common stock, $0.01 par value per share
(“BellRing Common Stock”) to Post shareholders in a pro-rata distribution (the “Distribution”).
Upon completion of the Distribution, BellRing Merger Sub merged with and into Old BellRing (the “Merger”), with Old
BellRing continuing as the surviving corporation and becoming a wholly-owned subsidiary of BellRing. Pursuant to the
Merger, each outstanding share of Old BellRing Class A Common Stock was converted into one share of BellRing Common
Stock plus $2.97 in cash, or $115.5 million total consideration paid to Old BellRing Class A common stockholders pursuant to
the Merger. As a result of the transactions described above (collectively, the “Spin-off”), BellRing became the new public
parent company of, and successor issuer to, Old BellRing, and shares of BellRing Common Stock were deemed to be registered
under Section 12(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), pursuant to Rule 12g-3(a)
promulgated thereunder.
Immediately prior to the Spin-off, Post held 97.5 million BellRing LLC units, equal to 71.5% of the economic interest in
BellRing LLC, and one share of Old BellRing Class B Common Stock, which represented 67% of the combined voting power
of the common stock of Old BellRing.
Immediately following the Spin-off, Post owned 19.4 million shares, or 14.2%, of BellRing Common Stock, which did not
represent a controlling interest in BellRing. As a result of the Spin-off, the dual class voting structure in the BellRing business
was eliminated.
On August 11, 2022, Post transferred 14.8 million shares of its BellRing Common Stock to certain financial institutions in
satisfaction of term loan obligations of Post. On November 25, 2022, Post transferred its remaining 4.6 million shares of
BellRing Common Stock to certain financial institutions in satisfaction of term loan obligations of Post. As such, Post had no
ownership of BellRing Common Stock as of September 30, 2024 or 2023.
The terms “BellRing,” “we,” “our,” “us,” “the Company” or “our Company” generally refer to Old BellRing and its
consolidated subsidiaries during the period prior to the Spin-off and to us and our consolidated subsidiaries during the periods
35
subsequent to the Spin-off unless otherwise stated or context otherwise indicates. The term “Common Stock” generally refers to
Old BellRing Class A Common Stock and Old BellRing Class B Common Stock during the period prior to the Spin-off and to
BellRing Common Stock during the periods subsequent to the Spin-off. The term “Net earnings available to common
stockholders” generally refers to net earnings available to Old BellRing Class A common stockholders during the period prior
to the Spin-off and to net earnings available to BellRing common stockholders during the periods subsequent to the Spin-off.
We are a consumer products holding company operating in the global convenient nutrition category and are a provider of
ready-to-drink (“RTD”) protein shakes and powders. We have a single operating and reportable segment, with our principal
products being protein-based consumer goods. Our primary brands are Premier Protein and Dymatize.
Industry & Company Trends
The success of companies in the convenient nutrition category is driven by how well such companies can grow, develop
and differentiate their brands. We expect the convergence of several factors to support the continued growth of the convenient
nutrition category, including:
•
consumers’ increasingly dedicated pursuit of active lifestyles and growing interest in nutrition and wellness;
•
growing awareness of the numerous health benefits of protein, including sustained energy, muscle recovery and
satiety; and
•
a rise in snacking and the desire for products that can be consumed on-the-go as nutritious snacks or meal
replacements.
Nonetheless, the consumer food and beverage industry faces a number of challenges and uncertainties, including:
•
the highly competitive nature of the industry, which involves competition from a host of nutritional food and beverage
companies, including manufacturers of other branded food and beverage products as well as manufacturers of private
label and store brand products;
•
changing consumer preferences which require food manufacturers to identify changing preferences and to offer
products that appeal to consumers;
•
supply chain challenges, including labor shortages and equipment delays, which have delayed capacity expansion
across the broader third-party aseptic processing contract manufacturer network; and
•
inflationary pressures (see “Market Trends” below for further information).
Seasonality
We have experienced in the past, and expect to continue to experience, seasonal fluctuations in our sales and operating
profit margins because of customer spending patterns and timing of our key retailers’ promotional activity. Historically, our first
fiscal quarter is seasonally low for all brands driven by a slowdown of consumption of our products during the holiday season.
Sales are typically higher throughout the remainder of the fiscal year as a result of promotional activity at key retailers as well
as organic growth of the business.
Market Trends
During fiscal 2023, input cost inflation, including raw material, packaging and manufacturing costs, impacted our supply
chain and put downward pressure on profit margins. As a result, we took pricing actions on certain products. During fiscal
2024, inflationary pressures on protein costs eased while other costs, such as packaging and manufacturing, continued to face
inflationary pressures. We expect inflationary pressures on most input costs to increase during fiscal 2025, and inflation could
have a materially adverse impact on our business in the future if inflation rates were to significantly exceed our ability to
achieve price increases or cost savings or if such price increases impact demand for our products.
For additional discussion, refer to “Liquidity and Capital Resources” within this section, as well as “Cautionary Statement
on Forward-Looking Statements” on page 1 of this report and “Risk Factors” in Part I of this report.
Items Affecting Comparability
During the years ended September 30, 2024 and 2023, net sales and/or operating profit were impacted by the following
items:
•
accelerated amortization expense of $17.4 million and $7.1 million for the years ended September 30, 2024 and 2023,
respectively, related to the discontinuance of the PowerBar business in North America; and
•
$5.0 million of expense for the year ended September 30, 2023 related to provisions for legal matters. For additional
information, refer to Note 14 within “Notes to Consolidated Financial Statements” in Item 8 of this report.
36
For further discussion, refer to “Results of Operations” within this section.
RESULTS OF OPERATIONS
Year Ended
September 30,
Change in
dollars in millions
2024
2023
$
%
Net Sales
$ 1,996.2 $ 1,666.8 $
329.4
20 %
Operating Profit
$ 387.7 $ 287.3 $
100.4
35 %
Interest expense, net
58.3
66.9
(8.6)
(13) %
Income tax expense
82.9
54.9
28.0
51 %
Net Earnings Available to Common Stockholders
$ 246.5 $ 165.5 $
81.0
49 %
Net Sales
Net sales increased $329.4 million, or 20%, during the year ended September 30, 2024 compared to the prior year. Sales
of Premier Protein products were up $317.8 million, or 23%, driven by 25% higher volumes primarily due to increased
promotional activity (which resulted in lower average net selling prices), higher RTD shake production and distribution gains.
Sales of Dymatize products were up $13.0 million, or 6%, on 10% higher volume. Dymatize volumes increased primarily due to
higher international volumes, partially offset by lower domestic volumes. This increase was partially offset by decreased
average net selling prices in the current year primarily due to increased promotional spending. Sales of all other products were
down $1.4 million.
Operating Profit
Operating profit increased $100.4 million, or 35%, during the year ended September 30, 2024 compared to the prior year.
This increase was primarily driven by higher net sales (net of increased promotional activity), as previously discussed, and
lower net product costs of $98.5 million (driven by lower raw material costs, partially offset by higher manufacturing costs).
These positive impacts were partially offset by increased employee-related expenses of $29.9 million, higher advertising
expense of $20.4 million and increased accelerated amortization expense of $10.3 million related to the discontinuance of the
PowerBar business in North America.
Interest Expense, Net
Interest expense, net decreased $8.6 million during the year ended September 30, 2024 compared to the prior year
primarily due to lower borrowings outstanding under our Revolving Credit Facility (as defined in “Liquidity and Capital
Resources” within this section). As a result, the weighted-average interest rate on our total outstanding debt decreased to 7.0%
for the year ended September 30, 2024 from 7.2% for the year ended September 30, 2023. See Note 13 within “Notes to
Consolidated Financial Statements” for additional information on our debt.
Income Tax Expense
Our effective income tax rate for fiscal 2024 was 25.2% compared to 24.9% for fiscal 2023. The following table presents
the reconciliation of income tax expense with amounts computed at the United States (“U.S.”) federal statutory tax rate.
Year Ended September 30,
dollars in millions
2024
2023
Computed tax at federal statutory rate (21%)
$
69.2 $
46.3
State income taxes, net of effect on federal tax
13.5
8.4
Other, net (none in excess of 5% of computed tax)
0.2
0.2
Income tax expense
$
82.9 $
54.9
The Organization for Economic Cooperation and Development’s global tax reform initiative (referred to as Pillar 2) is
aimed at ensuring multinational enterprises pay a minimum level of tax in all countries in which they operate, with certain
aspects of Pillar 2 effective January 1, 2024 and other aspects effective January 1, 2025. We continue to evaluate the impact of
these proposed and enacted legislative changes as new guidance becomes available and do not expect Pillar 2 to have a material
impact on our effective income tax rate or our consolidated results of operations, financial position or cash flows.
37
LIQUIDITY AND CAPITAL RESOURCES
During the years ended September 30, 2024 and 2023, we borrowed zero and $115.0 million, respectively, and repaid $25.0
million and $189.0 million, respectively, under our revolving credit facility, which is provided under our credit agreement
entered into on March 10, 2022 (as amended, the “Credit Agreement”) in an aggregate principal amount of $250.0 million (the
“Revolving Credit Facility”). We had $250.0 million and $225.0 million of borrowing capacity under the Revolving Credit
Facility as of September 30, 2024 and 2023, respectively, and there were no outstanding letters of credit under the Revolving
Credit Facility as of September 30, 2024 or 2023.
Letters of credit are available under the Revolving Credit Facility in an aggregate amount of up to $20.0 million. The
Credit Agreement provides for potential incremental revolving and term facilities at the Company’s request and at the discretion
of the lenders or other persons providing such incremental facilities, in each case on terms to be determined, and also permits
the Company to incur other secured or unsecured debt, in all cases subject to conditions and limitations on the amount as
specified in the Credit Agreement.
During the years ended September 30, 2024 and 2023, we repurchased 2.6 million and 4.2 million shares, respectively, of
our common stock at an average share price of $56.12 and $29.56 per share, respectively, and at a total cost, including accrued
excise tax and broker’s commissions, of $148.0 million and $126.3 million, respectively.
For additional information on our Credit Agreement and share repurchases, see Notes 13 and 16 within “Notes to
Consolidated Financial Statements.”
Sources and Uses of Cash
We expect to generate positive cash flows from operations and believe our cash on hand, cash flows from operations and
current and possible future credit facilities will be sufficient to satisfy our future working capital requirements, purchase
commitments, research and development activities, debt repayments (including interest payments), share repurchases and other
financing requirements for the foreseeable future. We are not aware of any trends or demands, commitments, events or
uncertainties that will result in, or that are reasonably likely to result in, our liquidity increasing or decreasing in any material
way that will impact meeting our capital needs during or beyond the next twelve months. Our ability to generate positive cash
flows from operations is dependent on general economic conditions, competitive pressures and other business risk factors. We
believe that we have sufficient liquidity and cash on hand to satisfy our cash needs. If we are unable to generate sufficient cash
flows from operations, or otherwise to comply with the terms of our credit facilities, we may be required to seek additional
financing alternatives.
Short-term financing needs primarily consist of working capital requirements and interest payments on our 7.00% senior
notes maturing in March 2030 (the “7.00% Senior Notes”). Long-term financing needs include the repayment of our 7.00%
Senior Notes. Additional long-term financing needs will depend largely on potential growth opportunities, including acquisition
activity and other strategic transactions. Our asset-light business model requires modest capital expenditures, with annual
capital expenditures over the last three fiscal years averaging less than 1% of net sales. No significant capital expenditures are
planned for fiscal 2025. Additionally, we may continue to repurchase shares of our common stock. Such repurchases, if any,
will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts
involved may be material.
Cash Requirements
Our cash requirements under our various contractual obligations and commitments include:
•
Debt Obligations and Interest Payments — See Note 13 within “Notes to Consolidated Financial Statements” for
additional information on our debt and the timing of expected future principal and interest payments.
•
Operating Leases — See Note 11 within “Notes to Consolidated Financial Statements” for additional information on
our operating leases and the timing of expected future payments.
•
Purchase Obligations — Purchase obligations are legally binding agreements to purchase goods, services or
equipment that specify all significant terms, including: fixed or minimum quantities to be purchased and/or penalties
imposed for failing to meet contracted minimum purchase quantities (such as “take-or-pay” contracts); fixed,
minimum or variable price provisions; and the approximate timing of the transaction. As of September 30, 2024, we
had total purchase commitments of $1,517.0 million (with $661.2 million due in fiscal 2025) which extend through
fiscal 2033.
•
Other liabilities – Other liabilities include obligations associated with certain employee benefit programs, provisions
for legal matters, unrecognized tax benefits and various other long-term liabilities, all of which have some inherent
38
uncertainty as to the amount and timing of payments and were reflected on our Consolidated Balance Sheets as of
September 30, 2024.
The following table presents select cash flow data, which is discussed below.
Year Ended September 30,
dollars in millions
2024
2023
Cash provided by (used in):
Operating activities
$
199.6 $
215.6
Investing activities
(1.8)
(1.8)
Financing activities
(175.1)
(201.7)
Effect of exchange rate changes on cash and cash equivalents
—
0.5
Net increase in cash and cash equivalents
$
22.7 $
12.6
Operating Activities
Cash provided by operating activities for the year ended September 30, 2024 decreased $16.0 million compared to the prior
year. The decrease was primarily due to increased inventory levels in the current year (driven by higher production), increased
trade receivable levels in the current year (driven by higher net sales) and increased tax payments (net of refunds) of
$32.3 million. These negative impacts were partially offset by fluctuations in the timing of payments of trade payables and
decreased interest payments of $7.0 million due to lower borrowings outstanding under our Revolving Credit Facility.
Investing Activities
Cash used in investing activities for both the years ended September 30, 2024 and 2023 was $1.8 million and related to
capital expenditures in each year.
Financing Activities
Fiscal 2024
Cash used in financing activities for the year ended September 30, 2024 was $175.1 million. We paid $146.6 million,
including broker’s commissions, for the repurchase of our common stock and repaid $25.0 million under the Revolving Credit
Facility.
Fiscal 2023
Cash used in financing activities for the year ended September 30, 2023 was $201.7 million. We paid $125.5 million,
including broker’s commissions, for the repurchase of our common stock and borrowed and repaid $115.0 million and
$189.0 million, respectively, under the Revolving Credit Facility.
Debt Covenants
The Credit Agreement contains affirmative and negative covenants applicable to us and our restricted subsidiaries
customary for agreements of this type, including delivery of financial and other information; compliance with laws;
maintenance of property; existence; insurance; books and records; providing inspection rights; obligation to provide collateral
and guarantees by certain new subsidiaries; delivery of environmental reports; participation in an annual meeting with the agent
and the lenders; further assurances; and limitations with respect to indebtedness, liens, fundamental changes, restrictive
agreements, use of proceeds, amendments of organization documents, prepayments and amendments of certain indebtedness,
dispositions of assets, acquisitions and other investments, sale leaseback transactions, changes in the nature of business,
transactions with affiliates and dividends and redemptions or repurchases of stock. Under the terms of the Credit Agreement,
we are also required to comply with a financial covenant requiring us to maintain a total net leverage ratio (as defined in the
Credit Agreement) not to exceed 6.00:1.00, measured as of the last day of each fiscal quarter. We were in compliance with the
financial covenant as of September 30, 2024, and we do not believe non-compliance is reasonably likely in the foreseeable
future.
The Credit Agreement provides for potential incremental revolving and term facilities at our request and at the discretion of
the lenders or other persons providing such incremental facilities, in each case on terms to be determined, and also permits us to
incur other secured or unsecured debt, in all cases subject to conditions and limitations as specified in the Credit Agreement.
In addition, the indenture governing the 7.00% Senior Notes contains negative covenants customary for this type of
agreement that limit our ability and the ability of our restricted subsidiaries to, among other things: borrow money or guarantee
debt; create liens; pay dividends on, or redeem or repurchase, stock; make specified types of investments and acquisitions; enter
into or permit to exist contractual limits on the ability of our subsidiaries to pay dividends to us; enter into transactions with
39
affiliates; and sell assets or merge with other companies. Certain of these covenants are subject to suspension when and if the
7.00% Senior Notes receive investment grade ratings.
COMMODITY TRENDS
We are exposed to price fluctuations primarily from purchases of ingredients and packaging materials, energy and other
inputs. Our principal ingredients are milk-based, whey-based and soy-based proteins, protein blends, sweeteners and vitamin
and mineral blends. Our principal packaging materials consist of aseptic foil and plastic lined cardboard cartons, flexible and
rigid plastic film and containers, beverage packaging and corrugate. These costs have been volatile in recent years, and future
changes in such costs may cause our results of operations and our operating margins to fluctuate significantly. We manage the
impact of cost increases, wherever possible, on commercially reasonable terms, by locking in prices on the quantities through
purchase commitments required to meet our production requirements. In addition, we may attempt to offset the effect of
increased costs by raising prices to our customers. However, for competitive reasons, we may not be able to pass along the full
effect of increases in raw materials and other input costs as we incur them. See “Market Trends” section above for additional
information regarding inflationary pressures on our commodity purchases.
CURRENCY
Certain sales and costs of our foreign operations are denominated in Euros. Consequently, profits from these operations are
impacted by fluctuations in the value of this currency relative to the U.S. Dollar. We incur gains and losses within our
stockholders’ equity due to the translation of our financial statements from foreign currencies into U.S. Dollars and our income
statement trends may be impacted by such translation of the income statements of our foreign operations. The exchange rates
used to translate our foreign sales into U.S. Dollars negatively affected net sales by less than 1% during the year ended
September 30, 2024, and did not have a material impact on our operating profit or net earnings during the year ended
September 30, 2024.
CRITICAL ACCOUNTING ESTIMATES
The preparation of financial statements in accordance with accounting principles generally accepted in the United States of
America (“GAAP”) requires the use of judgment, estimates and assumptions. We make these subjective determinations after
considering our historical performance, management’s experience, current economic trends and events and information from
outside sources. Inherent in this process is the possibility that actual results could differ from these estimates and assumptions
for any particular period.
Our significant accounting policies are described in Note 2 within “Notes to Consolidated Financial Statements.” Our
critical accounting estimates are those that involve a significant amount of estimation uncertainty and have a meaningful impact
on the reporting of our financial condition and results of operations.
Revenue Recognition, Allowance for Trade Promotions — The recognition of certain variable trade promotions, which
are treated as a reduction of revenue, requires significant management judgment regarding estimated purchase volumes and
program participation. Estimates are based on contractual provisions, redemption rate assumptions and our assessment of
current market provisions. Redemption rate assumptions are based on historical results of similar promotions on a deal-by-deal
basis, adjusted for current expectations of promotion performance based on current market trends. We review and update
estimates of variable consideration quarterly. Uncertainties related to the estimates of variable consideration are resolved in a
short time frame and do not require any additional constraint on variable consideration. Less than 1% of our annual net sales
represent variable consideration that will be resolved in the subsequent period. Based on historical experience, we do not
believe that there will be significant changes to our estimates of variable consideration when any uncertainties are resolved with
customers. However, significant changes in our estimates could have a material impact on our results of operations.
RECENTLY ISSUED AND ADOPTED ACCOUNTING STANDARDS
See Note 3 within “Notes to Consolidated Financial Statements” for a discussion regarding recently issued accounting
standards.
40
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company is exposed to market risk from commodity prices, foreign currency exchange rates and interest rates, among
others. For additional discussion of these risks, refer to “Cautionary Statement on Forward-Looking Statements” on page 1 and
“Risk Factors” in Item 1A of this report.
Commodity Price Risk
In the ordinary course of business, the Company is exposed to commodity price risks relating to the purchases of raw
materials. The Company manages the impact of cost increases, wherever possible, on commercially reasonable terms, by
locking in prices on the quantities through purchase commitments required to meet production requirements. In addition, the
Company may attempt to offset the effect of increased costs by raising prices to customers. However, for competitive reasons,
the Company may not be able to pass along the full effect of increases in raw materials and other input costs as they are
incurred.
Foreign Currency Risk
Related to Active Nutrition International GmbH, whose functional currency is the Euro, the Company is exposed to risks of
fluctuations in future cash flows and earnings due to changes in exchange rates.
Interest Rate Risk
As of both September 30, 2024 and 2023, the Company had outstanding principal value indebtedness of $840.0 million
related to its 7.00% Senior Notes. Additionally, the Company had an aggregate principal amount of $25.0 million outstanding
under its Revolving Credit Facility as of September 30, 2023. The Company had no outstanding borrowings under its
Revolving Credit Facility as of September 30, 2024. Borrowings under the Revolving Credit Facility bear interest at variable
rates.
As of September 30, 2024 and 2023, the fair value of the Company’s debt, excluding any borrowings under its Revolving
Credit Facility, was $880.6 million and $830.0 million, respectively. Changes in interest rates impact fixed and variable rate
debt differently. For fixed rate debt, a change in interest rates will only impact the fair value of the debt, whereas a change in
the interest rates on variable rate debt will impact interest expense and cash flows. A hypothetical 10% decrease in interest rates
would have increased the fair value of the fixed rate debt by approximately $7 million and $19 million as of September 30,
2024 and 2023, respectively. A hypothetical 10% increase in interest rates would have had an immaterial impact on both interest
expense and interest paid during both the years ended September 30, 2024 and 2023. For additional information regarding the
Company’s debt, see Note 13 within “Notes to Consolidated Financial Statements.”
41
ITEM 8.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
INDEX TO FINANCIAL STATEMENTS
Audited Consolidated Financial Statements
Report of Independent Registered Public Accounting Firm (PCAOB ID 238)
42
Consolidated Statements of Operations for the Fiscal Years Ended September 30, 2024, 2023 and 2022
44
Consolidated Statements of Comprehensive Income for the Fiscal Years Ended September 30, 2024, 2023 and 2022
45
Consolidated Balance Sheets as of September 30, 2024 and 2023
46
Consolidated Statements of Cash Flows for the Fiscal Years Ended September 30, 2024, 2023 and 2022
47
Consolidated Statements of Stockholders’ Deficit for the Fiscal Years Ended September 30, 2024, 2023 and 2022
48
Notes to Consolidated Financial Statements
49
42
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Stockholders of BellRing Brands, Inc.
Opinions on the Financial Statements and Internal Control over Financial Reporting
We have audited the accompanying consolidated balance sheets of BellRing Brands, Inc. and its subsidiaries (the
“Company”) as of September 30, 2024 and 2023, and the related consolidated statements of operations, of comprehensive
income, of stockholders' deficit and of cash flows for each of the three years in the period ended September 30, 2024, including
the related notes (collectively referred to as the “consolidated financial statements”). We also have audited the Company's
internal control over financial reporting as of September 30, 2024, based on criteria established in Internal Control - Integrated
Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial
position of the Company as of September 30, 2024 and 2023, and the results of its operations and its cash flows for each of the
three years in the period ended September 30, 2024 in conformity with accounting principles generally accepted in the United
States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over
financial reporting as of September 30, 2024, based on criteria established in Internal Control - Integrated Framework (2013)
issued by the COSO.
Basis for Opinions
The Company's management is responsible for these consolidated financial statements, for maintaining effective internal
control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included
in Management’s Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express
opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting
based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United
States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities
laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and
perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material
misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in
all material respects.
Our audits of the consolidated financial statements included performing procedures to assess the risks of material
misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to
those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the
consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates
made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of
internal control over financial reporting included obtaining an understanding of internal control over financial reporting,
assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal
control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the
circumstances. We believe that our audits provide a reasonable basis for our opinions.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally
accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures
that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with authorizations of management and directors of the
company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
43
Critical Audit Matters
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial
statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or
disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or
complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated
financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate
opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Receivables, net- Allowance for Trade Promotions
As described in Note 2 to the consolidated financial statements, many of the Company's contracts with customers include
some form of variable or fixed consideration. The most common forms of variable and fixed consideration are trade
promotions, rebates and discount programs. These programs resulted in an allowance for trade promotions of $38.8 million
which is reflected as a reduction of Receivables, net as of September 30, 2024. Variable consideration is treated as a reduction
of revenue at the time product revenue is recognized. Methodologies for determining these provisions are dependent on specific
customer pricing and promotional practices, which range from contractually fixed percentage price reductions to reimbursement
based on actual occurrence or performance. The Company reviews and updates estimates of variable consideration each period.
Uncertainties related to the estimates of variable consideration are resolved in a short time frame and do not require any
additional constraint on variable consideration. The principal consideration for our determination that performing procedures
relating to receivables, net - allowance for trade promotions is a critical audit matter is the matter involved significant audit
effort in performing procedures related to management’s allowance for trade promotions.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our
overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating
to the accuracy and valuation of the allowance for trade promotions. These procedures also included, among others (i) testing
management’s process for determining the allowance for trade promotions; (ii) evaluating the appropriateness of the
methodology; and (iii) testing the accuracy and relevance of underlying data used to determine the allowance for trade
promotions by examining customer agreements and sales data on a test basis.
/s/ PricewaterhouseCoopers LLP
St. Louis, Missouri
November 19, 2024
We have served as the Company's auditor since 2019.
44
BELLRING BRANDS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share data)
Year Ended September 30,
2024
2023
2022
Net Sales
$
1,996.2 $
1,666.8 $
1,371.5
Cost of goods sold
1,288.9
1,136.6
949.7
Gross Profit
707.3
530.2
421.8
Selling, general and administrative expenses
284.6
216.3
189.7
Amortization of intangible assets
35.0
26.6
19.7
Operating Profit
387.7
287.3
212.4
Interest expense, net
58.3
66.9
49.2
Loss on extinguishment of debt, net
—
—
17.6
Earnings before Income Taxes
329.4
220.4
145.6
Income tax expense
82.9
54.9
29.6
Net Earnings Including Redeemable Noncontrolling Interest
246.5
165.5
116.0
Less: Net earnings attributable to redeemable noncontrolling interest
—
—
33.7
Net Earnings Available to Common Stockholders
$
246.5 $
165.5 $
82.3
Earnings per share of Common Stock:
Basic
$
1.89 $
1.24 $
0.88
Diluted
$
1.86 $
1.23 $
0.88
Weighted-Average shares of Common Stock Outstanding:
Basic
130.3
133.0
93.5
Diluted
132.3
134.1
93.8
See accompanying Notes to Consolidated Financial Statements.
45
BELLRING BRANDS, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in millions)
Year Ended September 30,
2024
2023
2022
Net Earnings Including Redeemable Noncontrolling Interest
$
246.5 $
165.5 $
116.0
Hedging adjustments:
Reclassifications to net earnings
—
—
7.1
Foreign currency translation adjustments:
Unrealized foreign currency translation adjustments
1.1
1.2
(2.9)
Tax expense on other comprehensive income:
Reclassifications to net earnings
—
—
(0.4)
Total Other Comprehensive Income Including Redeemable
Noncontrolling Interest
1.1
1.2
3.8
Less: Comprehensive income attributable to redeemable noncontrolling interest
—
—
38.3
Total Comprehensive Income Available to Common Stockholders
$
247.6 $
166.7 $
81.5
See accompanying Notes to Consolidated Financial Statements.
46
BELLRING BRANDS, INC.
CONSOLIDATED BALANCE SHEETS
(in millions, except par value)
September 30,
2024
2023
ASSETS
Current Assets
Cash and cash equivalents
$
71.1 $
48.4
Receivables, net
220.4
168.2
Inventories
286.1
194.3
Prepaid expenses and other current assets
15.1
13.3
Total Current Assets
592.7
424.2
Property, net
9.2
8.5
Goodwill
65.9
65.9
Intangible assets, net
141.8
176.8
Deferred income taxes
12.9
4.2
Other assets
14.5
12.0
Total Assets
$
837.0 $
691.6
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current Liabilities
Accounts payable
$
121.0 $
89.0
Other current liabilities
82.7
61.2
Total Current Liabilities
203.7
150.2
Long-term debt
833.1
856.8
Deferred income taxes
0.4
0.4
Other liabilities
5.7
7.7
Total Liabilities
1,042.9
1,015.1
Commitments and Contingencies (See Note 14)
Stockholders’ Deficit
Preferred stock, $0.01 par value; 50.0 shares authorized, zero shares issued and outstanding in
each year
—
—
Common stock; $0.01 par value; 500.0 shares authorized in each year, 136.7 and 136.5 shares
issued, respectively; 128.8 and 131.2 shares outstanding, respectively
1.4
1.4
Additional paid-in capital
37.3
19.3
Retained earnings (accumulated deficit)
56.4
(190.1)
Accumulated other comprehensive loss
(2.0)
(3.1)
Treasury stock, at cost, 7.9 and 5.3 shares, respectively
(299.0)
(151.0)
Total Stockholders’ Deficit
(205.9)
(323.5)
Total Liabilities and Stockholders’ Deficit
$
837.0 $
691.6
See accompanying Notes to Consolidated Financial Statements.
47
BELLRING BRANDS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions)
Year Ended September 30,
2024
2023
2022
Cash Flows from Operating Activities
Net earnings including redeemable noncontrolling interest
$
246.5 $
165.5 $
116.0
Adjustments to reconcile net earnings including redeemable noncontrolling
interest to net cash provided by operating activities:
Depreciation and amortization
36.5
28.3
21.3
Loss on extinguishment and refinancing of debt, net
—
—
17.6
Non-cash stock-based compensation expense
21.0
14.2
9.8
Deferred income taxes
(8.7)
(6.0)
(4.0)
Other, net
1.9
1.2
1.4
Other changes in operating assets and liabilities:
(Increase) decrease in receivables
(51.6)
5.5
(70.7)
(Increase) decrease in inventories
(90.9)
6.4
(83.9)
(Increase) decrease in prepaid expenses and other current assets
(1.7)
(0.8)
1.1
(Increase) decrease in other assets
(2.5)
(1.8)
2.3
Increase in accounts payable and other current liabilities
49.2
3.1
10.3
Decrease in non-current liabilities
(0.1)
—
(0.2)
Net Cash Provided by Operating Activities
199.6
215.6
21.0
Cash Flows from Investing Activities
Additions to property
(1.8)
(1.8)
(1.8)
Net Cash Used in Investing Activities
(1.8)
(1.8)
(1.8)
Cash Flows from Financing Activities
Proceeds from issuance of long-term debt
—
115.0
164.0
Repayments of long-term debt
(25.0)
(189.0)
(674.9)
Payment of merger consideration
—
—
(115.5)
Purchases of treasury stock
(146.6)
(125.5)
(42.8)
Payments of debt issuance, extinguishment costs and deferred financing fees
—
—
(11.9)
Distributions from Post Holdings, Inc., net
—
—
547.2
Other, net
(3.5)
(2.2)
(1.1)
Net Cash Used in Financing Activities
(175.1)
(201.7)
(135.0)
Effect of Exchange Rate Changes on Cash and Cash Equivalents
—
0.5
(1.0)
Net Increase (Decrease) in Cash and Cash Equivalents
22.7
12.6
(116.8)
Cash and Cash Equivalents, Beginning of Year
48.4
35.8
152.6
Cash and Cash Equivalents, End of Year
$
71.1 $
48.4 $
35.8
Supplemental noncash information:
Debt issued to Post Holdings, Inc. in connection with Spin-off
$
— $
— $
840.0
See accompanying Notes to Consolidated Financial Statements.
48
BELLRING BRANDS, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT
(in millions)
As of and for the Year Ended September 30,
2024
2023
2022
Preferred Stock
Beginning and end of year
$
— $
— $
—
Common Stock
Beginning of year
1.4
1.4
0.4
Impact of Spin-off
—
—
1.0
End of year
1.4
1.4
1.4
Additional Paid-in Capital
Beginning of year
19.3
7.0
—
Activity under stock and deferred compensation plans
(3.0)
(1.9)
(0.9)
Non-cash stock-based compensation expense
21.0
14.2
9.8
Redemption value adjustment to redeemable noncontrolling interest
—
—
(1.9)
End of year
37.3
19.3
7.0
Retained Earnings (Accumulated Deficit)
Beginning of year
(190.1)
(355.6)
(3,059.7)
Net earnings available to common stockholders
246.5
165.5
82.3
Distributions to Post Holdings, Inc.
—
—
(3.2)
Redemption value adjustment to redeemable noncontrolling interest
—
—
372.4
Impact of Spin-off
—
—
2,252.6
End of year
56.4
(190.1)
(355.6)
Accumulated Other Comprehensive Loss
Hedging Adjustments, net of tax
Beginning of year
—
—
(1.6)
Net change in hedges, net of tax
—
—
1.6
End of year
—
—
—
Foreign Currency Translation Adjustments
Beginning of year
(3.1)
(4.3)
(1.9)
Foreign currency translation adjustments
1.1
1.2
(2.4)
End of year
(2.0)
(3.1)
(4.3)
Treasury Stock
Beginning of year
(151.0)
(24.7)
—
Purchases of treasury stock
(148.0)
(126.3)
(42.8)
Impact of Spin-off
—
—
18.1
End of year
(299.0)
(151.0)
(24.7)
Total Stockholders’ Deficit
$
(205.9) $
(323.5) $
(376.2)
Preferred Stock, shares
Beginning and end of year
—
—
—
Common Stock, shares
Beginning of year
131.2
135.3
39.5
Activity under stock and deferred compensation plans
0.2
0.1
0.2
Impact of Spin-off
—
—
97.5
Purchases of treasury stock
(2.6)
(4.2)
(1.9)
End of year
128.8
131.2
135.3
See accompanying Notes to Consolidated Financial Statements.
49
BELLRING BRANDS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
($ in millions, except per share information or where indicated otherwise)
NOTE 1 — BACKGROUND
On October 21, 2019, BellRing Intermediate Holdings, Inc. (formerly known as BellRing Brands, Inc.) (“Old BellRing”)
closed its initial public offering (the “IPO”) of 39.4 million shares of its Class A common stock, $0.01 par value per share (“Old
BellRing Class A Common Stock”), and contributed the net proceeds from the IPO to BellRing Brands, LLC, a Delaware
limited liability company and subsidiary of Old BellRing (“BellRing LLC”), in exchange for 39.4 million BellRing LLC non-
voting membership units (the “BellRing LLC units”). As a result of the IPO and certain other transactions completed in
connection with the IPO (the “formation transactions”), BellRing LLC became the holder of the active nutrition business of
Post Holdings, Inc. (“Post”). Old BellRing, as a holding company, had no material assets other than its ownership of BellRing
LLC units and its indirect interests in the subsidiaries of BellRing LLC and had no independent means of generating revenue or
cash flow. The members of BellRing LLC were Post and Old BellRing.
During the second quarter of fiscal 2022, Post completed its distribution of 80.1% of its ownership interest in BellRing
Brands, Inc. (formerly known as BellRing Distribution, LLC) (“BellRing”) to Post’s shareholders. On March 9, 2022, pursuant
to the Transaction Agreement and Plan of Merger, dated as of October 26, 2021 (as amended by Amendment No.1 to the
Transaction Agreement and Plan of Merger, dated as of February 28, 2022, the “Transaction Agreement”), by and among Post,
Old BellRing, BellRing and BellRing Merger Sub Corporation, a wholly-owned subsidiary of BellRing (“BellRing Merger
Sub”), Post contributed its share of Old BellRing Class B common stock, $0.01 par value per share (“Old BellRing Class B
Common Stock”), all of its BellRing LLC units and $550.4 of cash to BellRing (collectively, the “Contribution”) in exchange
for certain limited liability company interests of BellRing (prior to the conversion of BellRing into a Delaware corporation) and
the right to receive $840.0 in aggregate principal amount of BellRing’s 7.00% Senior Notes (as defined in Note 13).
On March 10, 2022, BellRing converted into a Delaware corporation and changed its name to “BellRing Brands, Inc.”, and
Post distributed an aggregate of 78.1 million, or 80.1%, of its shares of BellRing common stock, $0.01 par value per share
(“BellRing Common Stock”) to Post shareholders in a pro-rata distribution (the “Distribution”).
Upon completion of the Distribution, BellRing Merger Sub merged with and into Old BellRing (the “Merger”), with Old
BellRing continuing as the surviving corporation and becoming a wholly-owned subsidiary of BellRing. Pursuant to the
Merger, each outstanding share of Old BellRing Class A Common Stock was converted into one share of BellRing Common
Stock and $2.97 in cash, or $115.5 total consideration paid to Old BellRing Class A common stockholders pursuant to the
Merger. As a result of the transactions described above (collectively, the “Spin-off”), BellRing became the new public parent
company of, and successor issuer to, Old BellRing, and shares of BellRing Common Stock were deemed to be registered under
Section 12(b) of the Securities Exchange Act of 1934, as amended, pursuant to Rule 12g-3(a) promulgated thereunder.
Immediately prior to the Spin-off, Post held 97.5 million BellRing LLC units, equal to 71.5% of the economic interest in
BellRing LLC, and one share of Old BellRing Class B Common Stock, which represented 67% of the combined voting power
of the common stock of Old BellRing. Immediately following the Spin-off, Post owned 19.4 million shares, or 14.2%, of
BellRing Common Stock, which did not represent a controlling interest in BellRing. As a result of the Spin-off, the dual class
voting structure in the BellRing business was eliminated.
On August 11, 2022, Post transferred 14.8 million shares of its BellRing Common Stock to certain financial institutions in
satisfaction of term loan obligations of Post. On November 25, 2022, Post transferred its remaining 4.6 million shares of
BellRing Common Stock to certain financial institutions in satisfaction of term loan obligations of Post. As such, Post had no
ownership of BellRing Common Stock as of September 30, 2024 or 2023.
The Company incurred separation-related expenses of $0.7 and $14.5 during the years ended September 30, 2023 and
2022, respectively, in connection with its separation from Post. These expenses generally included third-party costs for advisory
services, fees charged by other service providers and government filing fees and were included in “Selling, general and
administrative expenses” in the Consolidated Statements of Operations. No separation-related expenses were incurred during
the year ended September 30, 2024.
The term “Company” generally refers to Old BellRing and its consolidated subsidiaries during the period prior to the Spin-
off and to BellRing and its consolidated subsidiaries during the periods subsequent to the Spin-off, unless otherwise stated or
context otherwise indicates. The term “Common Stock” generally refers to Old BellRing Class A Common Stock and Old
BellRing Class B Common Stock during the period prior to the Spin-off and to BellRing Common Stock during the periods
subsequent to the Spin-off. The term “Net earnings available to common stockholders” generally refers to net earnings available
to Old BellRing Class A common stockholders during the period prior to the Spin-off and to net earnings available to BellRing
common stockholders during the periods subsequent to the Spin-off.
50
The Company is a consumer products holding company operating in the global convenient nutrition category and is a
provider of ready-to-drink (“RTD”) protein shakes and powders. The Company has a single operating and reportable segment,
with its principal products being protein-based consumer goods. The Company’s primary brands are Premier Protein and
Dymatize.
NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation — Prior to the Spin-off, the financial results of BellRing LLC and its subsidiaries were
consolidated with Old BellRing, and a portion of the consolidated net earnings of BellRing LLC was allocated to the
redeemable noncontrolling interest (“NCI”). The calculation of the NCI was based on Post’s ownership percentage of BellRing
LLC units during the period prior to the Spin-off and reflected the entitlement of Post to a portion of the consolidated net
earnings of BellRing LLC prior to the Spin-off.
For the periods subsequent to the Spin-off, any remaining ownership of BellRing by Post no longer represented a NCI to
the Company (see Note 6). All intercompany balances and transactions have been eliminated. See Note 5 for further
information on transactions with Post included in these financial statements. Certain reclassifications have been made to
previously reported financial information to conform to the current year presentation.
Use of Estimates and Allocations — The consolidated financial statements of the Company are prepared in conformity with
accounting principles generally accepted in the United States of America (“GAAP”), which require certain elections as to
accounting policy, estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of
contingent liabilities at the dates of the financial statements and the reported amount of net revenues and expenses during the
reporting periods. Significant accounting policy elections, estimates and assumptions include, among others, allowance for
trade promotions. Actual results could differ from those estimates.
Cash Equivalents — Cash equivalents include all highly liquid investments with original maturities of less than three
months. At September 30, 2024 and 2023, the Company had $71.1 and $48.4, respectively, in available cash, of which
2.5% and 3.6%, respectively, was outside of the United States (“U.S.”). The Company’s intention is to reinvest these funds
indefinitely.
Receivables — Receivables are reported at net realizable value. This value includes appropriate allowances for credit
losses, cash discounts and other amounts which the Company does not ultimately expect to collect. To calculate the allowance
for credit losses, the Company estimates uncollectible amounts based on a review of past due balances, historical loss
information and an evaluation of customer accounts for potential future losses. A receivable is considered past due if payments
have not been received within the agreed upon invoice terms. Receivables are written off against the allowance when deemed to
be uncollectible based upon the Company’s evaluation of the customer’s solvency. As of September 30, 2024 and 2023, the
Company did not have off-balance sheet credit exposure related to its customers.
Inventories — Inventories are generally valued at the lower of cost (determined on a first-in, first-out basis) or net
realizable value. Reported amounts have been reduced by an allowance for obsolete product and packaging materials based on a
review of inventories on hand compared to estimated future usage and sales.
Property — Property is recorded at cost, and depreciation expense is generally provided on a straight-line basis over the
estimated useful life of the property. Estimated useful lives range from 3 to 10 years for machinery and equipment; 1 to 33
years for buildings, building improvements and leasehold improvements; and 1 to 5 years for software. Total depreciation
expense was $1.5, $1.7 and $1.6 in fiscal 2024, 2023 and 2022, respectively. Any gains and losses incurred on the sale or
disposal of assets would be included in other operating income/expense in the statement of operations. Ordinary repair and
maintenance costs are accounted for under the direct expensing method. Property consisted of:
September 30,
2024
2023
Land and land improvements
$
0.8 $
0.7
Buildings and leasehold improvements
4.5
5.6
Machinery and equipment
14.3
14.1
Software
1.2
2.4
Construction in progress
0.6
1.2
21.4
24.0
Accumulated depreciation
(12.2)
(15.5)
Property, net
$
9.2 $
8.5
51
As of both September 30, 2024 and 2023, the majority of the Company’s tangible long-lived assets were located in Europe
and had a net carrying value of $8.1 and $7.1, respectively; the remainder were located in the U.S.
Goodwill — Goodwill represents the excess of the cost of acquired businesses over the fair market value of their
identifiable net assets. The Company conducts a goodwill impairment assessment during the fourth quarter of each fiscal year
following the annual forecasting process, or more frequently if facts and circumstances indicate that goodwill may be impaired.
The goodwill impairment assessment performed may be either qualitative or quantitative; however, if adverse qualitative trends
are identified that could negatively impact the fair value of the business, a quantitative goodwill impairment test is performed.
The goodwill impairment qualitative assessment requires an analysis to determine if it is more likely than not that the fair value
of a reporting unit is less than its carrying amount.
The qualitative goodwill impairment test requires an entity to evaluate various events, circumstances and factors, such as
macroeconomic conditions, sensitivity of valuation inputs utilized in the Company’s most recent quantitative goodwill
impairment test, industry trends and results of operations of the entity, to determine whether it is more likely than not that the
fair value of a reporting unit is less than its carrying amount. Metrics such as the gross domestic product growth rate and
inflation rate, the discount rate and the terminal growth rate utilized in previous quantitative goodwill impairment tests, peer
multiples and category trends and actual results compared to forecast are evaluated by management to identify adverse trends
that could negatively impact the fair value of the reporting unit.
If adverse qualitative trends are identified that could negatively impact the fair value of a reporting unit, a quantitative
goodwill impairment test is performed. The quantitative goodwill impairment test requires an entity to compare the fair value of
each reporting unit with its carrying amount. The estimated fair value is determined using a combined income and market
approach with a greater weighting on the income approach. The income approach is based on discounted future cash flows and
requires significant assumptions, including estimates regarding future revenue, profitability, capital requirements and discount
rate. The market approach is based on a market multiple (revenue and EBITDA, which stands for earnings before interest,
income taxes, depreciation and amortization) and requires an estimate of appropriate multiples based on market data.
The Company has two reporting units, which have been identified at a level below the operating segment level; however,
only one reporting unit had a goodwill balance as of September 30, 2024, 2023 and 2022. In fiscal 2024, 2023 and 2022, the
Company performed a qualitative impairment test and determined there were no indicators, including adverse trends in the
business, that would indicate it was more likely than not that the fair value of the reporting unit was less than its carrying
amount. The Company last performed a quantitative impairment test in fiscal 2019. The Company did not record a goodwill
impairment charge during the years ended September 30, 2024, 2023 or 2022, as the reporting unit with goodwill passed the
qualitative impairment test.
The components of “Goodwill” on the Consolidated Balance Sheets at both the beginning and end of the years ended
September 30, 2024 and 2023 are presented in the following table.
Goodwill, gross
$
180.7
Accumulated impairment losses
(114.8)
Goodwill
$
65.9
Intangible Assets — Intangible assets consist primarily of definite-lived customer relationships, trademarks and brands.
Amortization expense related to definite-lived intangible assets, which is provided on a straight-line basis (as it approximates
the economic benefit) over the estimated useful lives of the assets, was $35.0, $26.6 and $19.7 in fiscal 2024, 2023 and 2022,
respectively. For the definite-lived intangible assets recorded as of September 30, 2024, amortization expense is expected to be
$17.0 per year for fiscal 2025 through fiscal 2029. Intangible assets consisted of:
September 30, 2024
September 30, 2023
Carrying
Amount
Accumulated
Amortization
Net
Amount
Carrying
Amount
Accumulated
Amortization
Net
Amount
Customer relationships
$
160.7 $
(94.6) $
66.1
$
178.4 $
(97.2) $
81.2
Trademarks and brands
164.4
(88.7)
75.7
194.0
(98.4)
95.6
Other intangible assets
3.1
(3.1)
—
3.1
(3.1)
—
Intangible assets, net
$
328.2 $
(186.4) $
141.8
$
375.5 $
(198.7) $
176.8
In August 2023, the Company approved a plan to discontinue the PowerBar business in North America. In connection with
the discontinuance, the Company updated the useful lives of the customer relationships and trademark associated with the
PowerBar business in North America to reflect the remaining period in which the Company expects to sell existing PowerBar
product inventory in North America. Accelerated amortization of $17.4 and $7.1 was recorded during the years ended
52
September 30, 2024 and 2023, respectively, resulting from the updated useful lives of the customer relationships and trademark
associated with the PowerBar business in North America, which were fully amortized and written off as of September 30, 2024.
Recoverability of Assets — The Company continually evaluates whether events or circumstances have occurred which
might impair the recoverability of the carrying value of its assets, including property, identifiable intangibles, goodwill and
right-of-use (“ROU”) assets. Definite-lived assets (groups) are tested for recoverability whenever events or changes in
circumstances indicate that the carrying amount of an asset (group) may not be recoverable or the estimated useful life is no
longer appropriate. The Company groups assets at the lowest level for which cash flows are separately identifiable. If
circumstances require that a definite-lived asset (group) be tested for possible impairment, the Company will compare the
undiscounted cash flows expected to be generated by the asset (group) to the carrying amount of the asset (group). If the
carrying amount of the asset (group) is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the
extent that the carrying amount of the asset (group) exceeds its fair value. There were no impairments recorded on the
Company’s definite-lived assets (groups) in fiscal 2024, 2023 or 2022.
Derivative Financial Instruments — In the ordinary course of business, the Company is exposed to commodity price risks
relating to the purchase of raw materials and supplies, interest rate risks relating to variable rate debt and foreign currency
exchange rate risks. The Company may utilize derivative instruments, including futures contracts, option contracts and swaps to
manage certain of these exposures by hedging when it is practical to do so. The Company does not hold or issue financial
instruments for speculative or trading purposes.
The Company’s derivative programs may include strategies that qualify and strategies that do not qualify for hedge
accounting treatment. To qualify for hedge accounting, the hedging relationship, both at inception of the hedge and on an
ongoing basis, is expected to be highly effective in achieving offsetting changes in the fair value of the hedged risk during the
period that the hedge is designated. All derivatives are recognized on the balance sheet at fair value. For derivatives that qualify
for hedge accounting, the derivative is designated as a hedge on the date in which the derivative contract is entered. Derivatives
could be designated as a hedge of the variability of cash flows to be received or paid related to a recognized asset or liability
(cash flow hedge). Derivatives may also be considered natural hedging instruments, where changes in their fair values act as
economic offsets to changes in fair values of the underlying hedged items and are not designated for hedge accounting. The
Company does not have any derivatives currently designated as hedging instruments under Accounting Standards Codification
(“ASC”) Topic 815, “Derivatives and Hedging.”
For previous cash flow hedges that were designated for hedge accounting, gains and losses were recorded in other
comprehensive income (“OCI”) and were reclassified to the Consolidated Statements of Operations in conjunction with the
recognition of the underlying hedged item. Changes in the fair value of derivatives that are not designated for hedge accounting
are recognized immediately in the Consolidated Statements of Operations. Cash flows from derivatives that were designated as
hedges and cash flows from derivatives that are not designated as hedges are classified in the same category on the
Consolidated Statements of Cash Flows as the items being hedged or on a basis consistent with the nature of the instruments.
The Company held no material derivative financial instruments as of September 30, 2024 or 2023.
Leases — The Company leases office space, certain warehouses and equipment primarily through operating lease
agreements. The Company has no finance lease agreements. The Company determines if an arrangement is a lease at its
inception. When the arrangements include lease and non-lease components, the Company accounts for them as a single lease
component. Leases with an initial term of less than 12 months are not reported on the balance sheet, but rather are recognized as
lease expense on a straight-line basis over the lease term. Arrangements may include options to extend or terminate the lease
arrangement. These options are included in the lease term used to establish ROU assets and lease liabilities when it is
reasonably certain they will be exercised. The Company will reassess expected lease terms based on changes in circumstances
that indicate options may be more or less likely to be exercised.
The Company has certain lease arrangements that include variable rental payments. The future variability of these
payments and adjustments are unknown and therefore are not included in minimum rental payments used to determine ROU
assets and lease liabilities. The Company has lease arrangements where it makes separate payments to the lessor based on the
lessor's common area maintenance expenses, property and casualty insurance costs, property taxes assessed on the property and
other variable expenses. As the Company has elected the practical expedient not to separate lease and non-lease components,
these variable amounts are captured in operating lease expense in the period in which they are incurred. Variable rental
payments are recognized in the period in which the associated obligation is incurred.
For lease arrangements that do not provide an implicit interest rate, an incremental borrowing rate (“IBR”) is applied in
determining the present value of future payments. The Company’s IBR is selected based upon information available at the lease
commencement date.
53
ROU assets are recorded as “Other assets,” and lease liabilities are recorded as “Other current liabilities” and “Other
liabilities” on the Consolidated Balance Sheets. Operating lease expense is recognized on a straight-line basis over the lease
term and is included in “Selling, general and administrative expenses” in the Consolidated Statements of Operations.
Revenue — The Company recognizes revenue when performance obligations have been satisfied by transferring control of
the goods to customers. Control is generally transferred upon delivery of the goods to the customer. At the time of delivery, the
customer is invoiced using previously agreed-upon credit terms. Shipping and/or handling costs that occur before the customer
obtains control of the goods are deemed fulfillment activities and are accounted for as fulfillment costs. The Company’s
contracts with customers generally contain one performance obligation.
Many of the Company’s contracts with customers include some form of variable or fixed consideration. The most common
forms of variable and fixed consideration are trade promotions, rebates and discount programs. As of September 30, 2024 and
2023, these programs resulted in an allowance for trade promotions of $38.8 and $15.8, respectively, which were recorded as a
reduction of “Receivables, net” on the Consolidated Balance Sheets. Variable consideration is treated as a reduction of revenue
at the time product revenue is recognized. Methodologies for determining these provisions are dependent on specific customer
pricing and promotional practices, which range from contractually fixed percentage price reductions to reimbursement based on
actual occurrence or performance. The Company does not believe that there will be significant changes to its estimates of
variable consideration when any uncertainties are resolved with customers. The Company reviews and updates estimates of
variable consideration each period. Uncertainties related to the estimates of variable consideration are resolved in a short time
frame and do not require any additional constraint on variable consideration. The majority of trade promotions are redeemed in
the form of invoice credits against trade receivables.
The Company’s products are sold with no right of return, except in the case of goods which do not meet product
specifications or are damaged. No services beyond this assurance-type warranty are provided to customers. Customer remedies
include either a cash refund or an exchange of the product. As a result, the right of return and related refund liability is
estimated and recorded as a reduction of revenue based on historical sales return experience.
Cost of Goods Sold — Cost of goods sold includes, among other things, inbound and outbound freight costs and
depreciation expense related to assets used in production, while storage and other warehousing costs are included in “Selling,
general and administrative expenses” in the Consolidated Statements of Operations. Storage and other warehousing costs
totaled $25.3, $20.1 and $16.6 in fiscal 2024, 2023 and 2022, respectively.
Advertising — Advertising costs are expensed as incurred, except for costs of producing media advertising such as
television commercials or magazine and online advertisements, which are deferred until the first time the advertising takes
place and amortized over the period the advertising runs. These amounts were reported within “Prepaid expenses and other
current assets” on the Consolidated Balance Sheets and were immaterial as of both September 30, 2024 and 2023.
Stock-based Compensation — The Company recognizes the cost of employee services received in exchange for awards of
equity instruments based on the grant-date fair value of the equity award. The cost for an equity award is recognized ratably
over the period during which an employee is required to provide service in exchange for the award — the requisite service
period (usually the vesting period). Any forfeitures of stock-based awards are recorded as they occur.
Income Tax Expense — Income tax expense is estimated based on income taxes in each jurisdiction and includes the effects
of both current tax exposures and the temporary differences resulting from differing treatment of items for tax and financial
reporting purposes. These temporary differences result in deferred tax assets and liabilities. A valuation allowance is established
against the related deferred tax assets to the extent that it is not “more likely than not” that the future benefits will be realized.
Reserves are recorded for estimated exposures associated with the Company’s tax filing positions, which are subject to periodic
audits by governmental taxing authorities. Interest incurred due to an underpayment of income taxes is classified as income tax
expense.
Immediately prior to the Spin-off, Old BellRing held 28.5% of the economic interest in BellRing LLC (see Note 1), which,
as a result of the IPO and formation transactions, was treated as a partnership for U.S. federal income tax purposes. As a
partnership, BellRing LLC was itself generally not subject to U.S. federal income tax under current U.S. tax laws. Old BellRing
was subject to U.S. federal income taxes, in addition to state and local income taxes, with respect to its 28.5% distributive share
of the items of income, gain, loss and deduction of BellRing LLC. Old BellRing was also subject to taxes in foreign
jurisdictions. Subsequent to the Spin-off, the Company reported 100% of the income, gain, loss and deduction of BellRing LLC
for U.S. federal, state, and local income tax purposes.
NOTE 3 — RECENTLY ISSUED AND ADOPTED ACCOUNTING STANDARDS
The Company has considered all new accounting pronouncements and has concluded there are no new pronouncements
(other than the ones described below) that had or will have a material impact on the Company’s results of operations,
comprehensive income, financial position, cash flows, stockholders’ equity or related disclosures based on current information.
54
In December 2023, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”)
2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures.” This ASU is effective for fiscal years
beginning after December 15, 2024 (i.e., the Company’s annual financial statements for the year ended September 30, 2026),
with early adoption permitted. This ASU should be adopted prospectively; however, retrospective adoption is permitted. The
Company is currently evaluating the impact of this standard.
In November 2023, the FASB issued ASU 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable
Segment Disclosures.” This ASU is effective for fiscal years beginning after December 15, 2023 (i.e., the Company’s annual
financial statements for the year ended September 30, 2025) and for interim periods within fiscal years beginning after
December 15, 2024 (i.e., the Company’s interim financial statements for the three months ended December 31, 2025), with
early adoption permitted. This ASU requires retrospective adoption. The Company is currently evaluating the impact of this
standard.
In addition, subsequent to September 30, 2024, the FASB issued ASU 2024-03, “Income Statement-Reporting
Comprehensive Income-Expense Disaggregation Disclosures (subtopic 220-40): Disaggregation of Income Statement
Expenses.” This ASU is effective for fiscal years beginning after December 15, 2026 (i.e., the Company’s annual financial
statements for the year ended September 30, 2028) and for interim periods within fiscal years beginning after December 15,
2027 (i.e., the Company’s interim financial statements for the three months ended December 31, 2028), with early adoption
permitted. This ASU can be adopted either (i) prospectively to financial statements issued for reporting periods after the
effective date of the ASU or (ii) retrospectively to any or all prior periods presented in the financial statements. The Company is
currently evaluating the impact of this standard.
NOTE 4 — REVENUE
The following table presents net sales by product.
Year Ended September 30,
2024
2023
2022
Shakes and other beverages
$
1,619.2 $
1,327.0 $
1,084.0
Powders
326.7
289.7
242.2
Other
50.3
50.1
45.3
Net Sales
$
1,996.2 $
1,666.8 $
1,371.5
The Company’s revenues were primarily generated by sales within the U.S.; foreign sales were 10.8%, 10.5% and 11.3%
of total fiscal 2024, 2023 and 2022 net sales, respectively. The largest concentration of foreign sales in fiscal 2024, 2023 and
2022 was within Canada, which accounted for 37.7%, 40.8% and 35.4% of total foreign sales, respectively.
Three customers individually accounted for more than 10% of total net sales in each of the years ended September 30,
2024 and 2023 and two customers individually accounted for more than 10% of total net sales in the year ended September 30,
2022. One customer accounted for 35.8%, 33.9% and 31.9% of total net sales in the years ended September 30, 2024, 2023 and
2022, respectively. A second customer accounted for 27.3%, 30.0% and 31.6% of total net sales in the years ended September
30, 2024, 2023 and 2022, respectively. A third customer accounted for 11.7% and 11.4% of total net sales in the years ended
September 30, 2024 and September 30, 2023, respectively, but did not account for more than 10% of total net sales in the year
ended September 30, 2022.
NOTE 5 — RELATED PARTY TRANSACTIONS
Both prior to and subsequent to the Spin-off, transactions with Post were considered related party transactions as certain of
the Company’s officers and/or directors serve as officers and/or directors of Post.
55
The MSA and Royalties
The Company uses certain functions and services performed by Post under a master services agreement (the “MSA”).
These functions and services include finance, internal audit, treasury, information technology support, insurance and tax
matters, the use of office and/or data center space, payroll processing services and tax compliance services. Prior to the Spin-
off, Post also provided legal services to the Company. The MSA was amended and restated upon completion of the Spin-off to
provide for similar services following the Spin-off and such other services as BellRing and Post may agree. The MSA was
further amended on August 4, 2023 to modify the scope and pricing, and extended the term of certain services provided under
it, none of which modifications are expected to materially increase the aggregate fees payable under the MSA. During the years
ended September 30, 2024, 2023 and 2022, MSA fees were $3.4, $4.0 and $4.6, respectively. MSA fees were reported in
“Selling, general and administrative expenses” in the Consolidated Statements of Operations.
The Company licenses certain intellectual property to and from Post and its subsidiaries based upon prices governed by
agreements between the Company and Post and its subsidiaries, consistent with prices of similar arm's-length transactions.
During each of the years ended September 30, 2024, 2023 and 2022, royalties paid to and received from Post and its
subsidiaries were immaterial.
Co-Packing Agreement
On September 30, 2022, Premier Nutrition Company, LLC (“Premier Nutrition”), a subsidiary of the Company, entered
into a co-packing agreement with Comet Processing, Inc. (“Comet”), a wholly-owned subsidiary of Post (the “Co-Packing
Agreement”). Under the Co-Packing Agreement, Premier Nutrition procures certain packaging materials for Comet that Comet
utilizes in the production of RTD shakes for Premier Nutrition. In December 2023, in accordance with the terms of the Co-
Packing Agreement, Comet began manufacturing RTD shakes for Premier Nutrition. During the year ended September 30,
2024, purchases of RTD shakes manufactured by Comet were $8.6. There were no purchases of RTD shakes manufactured by
Comet during fiscal 2023 or 2022.
As of September 30, 2024 and 2023, the Company had current payables with Post of $1.5 and $2.5, respectively, related to
RTD shake purchases and MSA fees in the current year and reimbursable start-up costs in the prior year, which were included
in “Accounts payable” on the Consolidated Balance Sheets. Current receivables with Post at both September 30, 2024 and 2023
were immaterial.
Stock Based Compensation
Prior to the IPO, the Company’s employees participated in various Post long-term incentive plans which issued awards
connected to Post common stock (“Post Equity Awards”). Subsequent to the IPO, BellRing employees were no longer eligible
to receive new issuances of Post Equity Awards; however, BellRing employees continued to vest in any issued and outstanding
Post Equity Awards, pursuant to the terms of the awards, and the Company incurred pass-through charges from Post relating to
these awards. During each of the years ended September 30, 2023 and 2022, total compensation cost related to the Post Equity
Awards recognized by the Company was immaterial, and all Post Equity Awards had vested as of September 30, 2023. There
was no compensation cost related to the Post Equity Awards recognized by the Company during the year ended September 30,
2024.
NOTE 6 — REDEEMABLE NONCONTROLLING INTEREST
Immediately prior to the Spin-off, Post held 97.5 million BellRing LLC units equal to 71.5% of the economic interest in
BellRing LLC. Prior to the Spin-off, Post had the right to redeem BellRing LLC units for, at BellRing LLC’s option (as
determined by its Board of Managers), (i) shares of Old BellRing Class A Common Stock, at an initial redemption rate of one
share of Old BellRing Class A Common Stock for one BellRing LLC unit, subject to customary redemption rate adjustments for
stock splits, stock dividends and reclassification or (ii) cash (based on the market price of the shares of Old BellRing Class A
Common Stock).
Post’s ownership of BellRing LLC units prior to the Spin-off represented a NCI to the Company, which was classified
outside of permanent stockholders’ equity as the BellRing LLC units were redeemable at the option of Post, through Post’s
ownership of Old BellRing Class B Common Stock (see Note 1). The carrying amount of the NCI was the greater of: (i) the
initial carrying amount, increased or decreased for the NCI’s share of net income or loss, other comprehensive income or loss
and distributions or dividends or (ii) the redemption value. Changes in the redemption value of the NCI were recorded to
“Additional paid-in capital”, to the extent available, and “Retained earnings (accumulated deficit)” on the Consolidated Balance
Sheets.
Immediately prior to the Spin-off, Old BellRing owned 28.5% of the outstanding BellRing LLC units. Prior to the Spin-
off, the financial results of BellRing LLC and its subsidiaries were consolidated with Old BellRing, and the portion of the
consolidated net earnings of BellRing LLC to which Post was entitled was allocated to the NCI during the period.
56
Immediately following the Spin-off, Post owned 14.2% of the BellRing Common Stock, which did not represent a
controlling interest in the Company. As a result of the Spin-off, the carrying amount of the NCI was reduced to zero
immediately following the Spin-off.
The following table summarizes the changes to the Company’s NCI for the year ended September 30, 2022 prior to the
Spin-off. There were no changes to the Company’s NCI for the years ended September 30, 2024 or 2023 as the carrying amount
of the NCI was reduced to zero immediately following the Spin-off.
Beginning of year
$
2,997.3
Net earnings attributable to NCI
33.7
Net change in hedges, net of tax
5.1
Foreign currency translation adjustments
(0.5)
Redemption value adjustment to NCI
(370.5)
Impact of Spin-off
(2,665.1)
End of year
$
—
The following table summarizes the effects of changes in NCI on the Company’s equity for the year ended September 30,
2022 prior to the Spin-off. There were no transfers to or from NCI for the years ended September 30, 2024 or 2023 as the
carrying amount of the NCI was reduced to zero immediately following the Spin-off.
Net earnings available to common stockholders
$
82.3
Transfers from NCI:
Changes in equity as a result of redemption value adjustment to NCI
(370.5)
Increase in equity as a result of the Spin-off
(2,665.1)
Changes from net earnings available to common stockholders and transfers from NCI
$
(2,953.3)
NOTE 7 — INCOME TAXES
Prior to the Spin-off, Old BellRing held an economic interest in BellRing LLC (see Note 1) which, as a result of the IPO
and formation transactions, was treated as a partnership for U.S. federal income tax purposes. As a partnership, BellRing LLC
was itself generally not subject to U.S. federal income tax under current U.S. tax laws. Generally, items of taxable income, gain,
loss and deduction of BellRing LLC were passed through to its members, Old BellRing and Post. Old BellRing was responsible
for its share of taxable income or loss of BellRing LLC allocated to it in accordance with the amended and restated limited
liability company agreement of BellRing LLC and partnership tax rules and regulations.
Subsequent to the Spin-off, the Company reported 100% of the income, gain, loss and deduction of BellRing LLC for U.S.
federal, state and local income tax purposes.
The expense (benefit) for income taxes consisted of the following:
Year Ended September 30,
2024
2023
2022
Current:
Federal
$
73.1 $
49.1 $
28.0
State
17.8
10.9
5.2
Foreign
0.7
0.9
0.4
91.6
60.9
33.6
Deferred:
Federal
(7.1)
(4.9)
(3.4)
State
(1.6)
(1.1)
(0.6)
Foreign
—
—
—
(8.7)
(6.0)
(4.0)
Income tax expense
$
82.9 $
54.9 $
29.6
57
The effective income tax rate for fiscal 2024 was 25.2% compared to 24.9% for fiscal 2023 and 20.3% for fiscal 2022. The
increase in the effective income tax rates for fiscal 2024 and fiscal 2023 compared to fiscal 2022 was primarily due to the
change in tax expense allocation related to the Spin-off. After the Spin-off, the Company reported 100% of the income, gain,
loss and deduction of BellRing LLC for U.S. federal, state, and local income tax purposes, whereas, prior to the Spin-off in the
second quarter of fiscal 2022, the Company reported Old BellRing’s share of such activity. This increase was partially offset by
higher separation-related expenses incurred in connection with the Spin-off in fiscal 2022 that were treated as non-deductible.
The following table presents the reconciliation of income tax expense with amounts computed at the federal statutory tax
rate.
Year Ended September 30,
2024
2023
2022
Computed tax at federal statutory rate (21%)
$
69.2 $
46.3 $
30.6
Income tax expense attributable to NCI
—
—
(7.6)
State income taxes, net of effect on federal tax
13.5
8.4
4.7
Transaction costs
—
—
2.0
Other, net (none in excess of 5% of computed tax)
0.2
0.2
(0.1)
Income tax expense
$
82.9 $
54.9 $
29.6
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts used for income tax purposes. Deferred tax non-current assets
(liabilities) were as follows:
September 30, 2024
September 30, 2023
Assets
Liabilities
Net
Assets
Liabilities
Net
Accrued liabilities
$
6.7 $
— $
6.7
6.0
—
6.0
Accrued vacation, incentive and severance
5.0
—
5.0
3.1
—
3.1
Capitalized research and development
4.7
—
4.7
2.3
—
2.3
Inventory
4.2
—
4.2
4.4
—
4.4
Stock-based compensation awards
3.0
—
3.0
2.2
—
2.2
Lease liabilities
1.0
—
1.0
1.4
—
1.4
Intangible assets
—
(10.9)
(10.9)
—
(13.9)
(13.9)
ROU assets
—
(1.0)
(1.0)
—
(1.4)
(1.4)
Property
—
(0.2)
(0.2)
—
(0.3)
(0.3)
Total deferred income taxes
$
24.6 $
(12.1) $
12.5
$
19.4 $
(15.6) $
3.8
No provision has been made for income taxes on undistributed earnings of consolidated foreign subsidiaries of $4.2 and
$2.8 at September 30, 2024 and 2023, respectively, as it is the Company’s intention to indefinitely reinvest undistributed
earnings of its foreign subsidiaries. Any additional income taxes and applicable foreign withholding taxes that would be
payable on the remittance of such undistributed earnings would be immaterial.
For fiscal 2024, 2023 and 2022, foreign income before income taxes was $2.0, $2.0 and $1.1, respectively.
Unrecognized Tax Benefits
The Company recognizes the tax benefit from uncertain tax positions only if it is “more likely than not” that the tax
position will be sustained on examination by the taxing authorities. The tax benefits recognized from such positions are
measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. To the
extent the Company’s assessment of such tax positions changes, the change in estimate will be recorded in the period in which
the determination is made.
At September 30, 2024 and 2023, the Company had net unrecognized tax benefits of $1.4 and $1.5, respectively. There was
no material unrecognized tax benefits activity during the years ended September 30, 2024, 2023 or 2022. The amount of the net
unrecognized tax benefits that, if recognized, would directly affect the effective tax rate was $1.4 at September 30, 2024. No
material changes to unrecognized tax benefits at September 30, 2024 are expected to be recognized within the next twelve
months.
58
The Company computes tax-related interest and penalties as the difference between the tax position recognized for
financial reporting purposes and the amount previously taken on the Company’s tax returns and classifies these amounts as
components of income tax (benefit) expense. During each of the years ended September 30, 2024, 2023 and 2022, expenses
recorded related to interest and penalties were immaterial, and the Company had immaterial interest and penalty accruals at
both September 30, 2024 and 2023.
U.S. federal, U.S. state and foreign jurisdiction income tax returns for the tax years ended September 30, 2021 through
September 30, 2023 are generally open and subject to examination by the tax authorities in each respective jurisdiction.
NOTE 8 — EARNINGS PER SHARE
Prior to the Spin-off, basic earnings per share was based on the average number of shares of Old BellRing Class A
Common Stock outstanding during the year. Diluted earnings per share was based on the average number of shares of Old
BellRing Class A Common Stock used for the basic earnings per share calculation, adjusted for the dilutive effect of stock
options and restricted stock units using the “treasury stock” method. In addition, “Net earnings available to common
stockholders for diluted earnings per share” in the table below was adjusted for diluted net earnings per share of Old BellRing
Class A Common Stock attributable to NCI, to the extent it was dilutive.
Subsequent to the Spin-off, basic earnings per share is based on the average number of shares of BellRing Common Stock
outstanding during the year. Diluted earnings per share is based on the average number of shares of BellRing Common Stock
used for the basic earnings per share calculation, adjusted for the dilutive effect of stock options and restricted stock units using
the “treasury stock” method.
Prior to the Spin-off, the share of Old BellRing Class B Common Stock did not have economic rights, including rights to
dividends or distributions upon liquidation, and was therefore not a participating security. Subsequent to the Spin-off, the share
of Old BellRing Class B Common Stock was no longer outstanding. As such, separate presentation of basic and diluted
earnings per share of Old BellRing Class B Common Stock under the two-class method has not been presented for any years.
The following table sets forth the computation of basic and diluted earnings per share.
Year Ended September 30,
2024
2023
2022
Net earnings available to common stockholders for basic earnings per share
$
246.5 $
165.5 $
82.3
Dilutive impact of net earnings attributable to NCI
—
—
—
Net earnings available to common stockholders for diluted earnings per share
$
246.5 $
165.5 $
82.3
shares in millions
Weighted-average shares for basic earnings per share
130.3
133.0
93.5
Effect of dilutive securities:
Stock options
0.2
0.1
0.1
Restricted stock units
0.3
0.3
0.2
Performance-based restricted stock units
1.5
0.7
—
Weighted-average shares for diluted earnings per share
132.3
134.1
93.8
Basic earnings per share of Common Stock
$
1.89 $
1.24 $
0.88
Diluted earnings per share of Common Stock
$
1.86 $
1.23 $
0.88
The following table details the securities that have been excluded from the calculation of weighted-average shares for
diluted earnings per share as they were anti-dilutive.
Year Ended September 30,
shares in millions
2024
2023
2022
Restricted stock units
—
0.1
0.1
Performance-based restricted stock units
—
0.1
0.1
59
NOTE 9 — SUPPLEMENTAL OPERATIONS STATEMENT AND CASH FLOW INFORMATION
Year Ended September 30,
2024
2023
2022
Advertising expenses
$
61.3 $
40.9 $
22.6
Research and development expenses
14.3
12.0
11.4
Interest paid
59.6
66.6
45.0
Income taxes paid (a)
93.2
60.9
34.6
(a) Subsequent to the Spin-off, the Company reported 100% of the income, gain, loss and deduction of BellRing LLC. See Note 7 for
additional information on the Company’s income taxes.
NOTE 10 — SUPPLEMENTAL BALANCE SHEET INFORMATION
September 30,
2024
2023
Receivables, net
Trade
$
205.6 $
147.3
Other
15.1
21.2
220.7
168.5
Allowance for credit losses
(0.3)
(0.3)
$
220.4 $
168.2
Inventories
Raw materials and supplies
$
57.3 $
60.4
Work in process
—
0.1
Finished products
228.8
133.8
$
286.1 $
194.3
Accounts Payable
Trade
$
119.1 $
85.0
Related party
1.5
2.5
Other
0.4
1.5
$
121.0 $
89.0
Other Current Liabilities
Accrued legal matters
$
21.0 $
21.0
Accrued compensation
23.8
14.8
Advertising and promotion
8.1
5.4
Other
29.8
20.0
$
82.7 $
61.2
NOTE 11 — LEASES
The Company leases office space, certain warehouses and equipment primarily through operating lease agreements. The
Company has no finance lease agreements. Leases have remaining terms which range from less than 1 year to 9 years and most
leases provide the Company with the option to exercise one or more renewal terms.
60
The following table presents the balance sheet location of the Company’s operating leases.
September 30,
2024
2023
ROU assets:
Other assets
$
5.8 $
7.4
Lease liabilities:
Other current liabilities
$
2.2 $
2.1
Other liabilities
4.3
6.1
Total liabilities
$
6.5 $
8.2
Future minimum payments of the Company’s operating lease liabilities as of September 30, 2024 are presented in the
following table.
Fiscal 2025
$
2.5
Fiscal 2026
2.4
Fiscal 2027
1.0
Fiscal 2028
0.2
Fiscal 2029
0.2
Thereafter
0.8
Total future minimum payments
7.1
Less: Implied interest
(0.6)
Total lease liabilities
$
6.5
The following table presents supplemental information related to the Company’s operating leases.
Year Ended September 30,
2024
2023
2022
Total operating lease expense
$3.4
$3.1
$3.8
Variable lease expense
1.0
0.9
0.9
Weighted-average remaining lease term
4 years
4 years
4 years
Weighted-average incremental borrowing rate
4.9%
4.8%
4.6%
Operating cash flows for amounts included in the measurement of the Company’s operating lease liabilities for the years
ended September 30, 2024, 2023 and 2022 were $2.5, $2.4 and $2.2, respectively. Short-term lease expense for the years ended
September 30, 2024, 2023 and 2022 was immaterial. ROU assets obtained in exchange for operating lease liabilities during the
years ended September 30, 2024, 2023 and 2022 were immaterial.
NOTE 12 — FAIR VALUE MEASUREMENTS
The Company’s financial assets and liabilities include cash and cash equivalents, receivables and accounts payable for
which the carrying value approximates fair value due to their short maturities (less than 12 months). The Company does not
record its long-term debt at fair value on the Consolidated Balance Sheets. The fair value of outstanding borrowings under the
Revolving Credit Facility (as defined in Note 13) as of September 30, 2023 approximated its carrying value. Based on market
rates, the fair value (Level 2) of the Company’s debt, excluding any borrowings under the Revolving Credit Facility, was
$880.6 and $830.0 as of September 30, 2024 and 2023, respectively.
Certain assets and liabilities, including property, goodwill and other intangible assets, are measured at fair value on a non-
recurring basis using Level 3 inputs. No impairment charges were recorded for property, goodwill or other intangible assets
during the years ended September 30, 2024, 2023 or 2022.
61
NOTE 13 — LONG-TERM DEBT
The following table presents the components of “Long-term debt” on the Consolidated Balance Sheets.
September 30,
2024
2023
7.00% Senior Notes maturing in March 2030
$
840.0 $
840.0
Revolving Credit Facility
—
25.0
Total principal amount of debt
840.0
865.0
Less: Debt issuance costs, net
6.9
8.2
Long-term debt
$
833.1 $
856.8
Senior Notes
On March 10, 2022, pursuant to the Transaction Agreement, the Company issued $840.0 aggregate principal amount of
7.00% senior notes maturing in March 2030 (the “7.00% Senior Notes”) to Post as partial consideration for the Contribution in
connection with the Distribution. Post subsequently delivered the 7.00% Senior Notes to certain financial institutions in
satisfaction of term loan obligations of Post in an equal principal amount.
The 7.00% Senior Notes were issued at par, and the Company incurred debt issuance costs of $10.2, which were deferred
and are being amortized to interest expense over the term of the 7.00% Senior Notes. Interest payments are due semi-annually
each March 15 and September 15. The 7.00% Senior Notes are senior unsecured obligations of BellRing and are guaranteed by
BellRing’s existing and subsequently acquired or organized wholly-owned domestic subsidiaries that guarantee the Credit
Agreement or the Company’s other indebtedness (other than immaterial subsidiaries, certain excluded subsidiaries and
subsidiaries the Company designates as unrestricted subsidiaries). The maturity date of the 7.00% Senior Notes is March 15,
2030.
Credit Agreement
On March 10, 2022, pursuant to the Transaction Agreement, the Company entered into a credit agreement (as amended, the
“Credit Agreement”), which provides for a revolving credit facility in an aggregate principal amount of $250.0 (the “Revolving
Credit Facility”), with commitments made available to the Company in U.S. Dollars, Euros and United Kingdom (“U.K.”)
Pounds Sterling. Letters of credit are available under the Credit Agreement in an aggregate amount of up to $20.0. Any
outstanding amounts under the Credit Agreement must be repaid on or before March 10, 2027.
Borrowings under the Revolving Credit Facility bear interest at an annual rate equal to: (i) in the case of loans denominated
in U.S. Dollars, at the Company’s option, the base rate (as defined in the Credit Agreement) plus a margin which ranges from
2.00% to 2.75% depending on the Company’s secured net leverage ratio (as defined in the Credit Agreement), or the adjusted
term SOFR rate (as defined in the Credit Agreement) for the applicable interest period plus a margin which ranges from 3.00%
to 3.75% depending on the Company’s secured net leverage ratio; (ii) in the case of loans denominated in Euros, the adjusted
Eurodollar rate (as defined in the Credit Agreement) for the applicable interest period plus a margin which ranges from 3.00%
to 3.75% depending on the Company’s secured net leverage ratio; and (iii) in the case of loans denominated in U.K. Pounds
Sterling, the adjusted daily simple RFR (as defined in the Credit Agreement) plus a margin which ranges from 3.00% to 3.75%
depending on the Company’s secured net leverage ratio. Facility fees on the daily unused amount of commitments under the
Revolving Credit Facility will accrue at rates ranging from 0.25% to 0.375% per annum, depending on the Company’s secured
net leverage ratio.
The Company incurred $1.5 of financing fees in connection with the Revolving Credit Facility, which were deferred and
are being amortized to interest expense over the term of the Revolving Credit Facility. During the years ended September 30,
2024, 2023 and 2022, the Company borrowed zero, $115.0 and $164.0 under the Revolving Credit Facility, respectively, and
repaid $25.0, $189.0 and $65.0 under the Revolving Credit Facility, respectively. The interest rate on the utilized portion of the
Revolving Credit Facility was 8.42% as of September 30, 2023 and there were no amounts outstanding under the Revolving
Credit Facility as of September 30, 2024. The available borrowing capacity under the Revolving Credit Facility was $250.0 and
$225.0 as of September 30, 2024 and 2023, respectively. There were no outstanding letters of credit as of September 30, 2024
or 2023.
Under the terms of the Credit Agreement, BellRing is required to maintain a total net leverage ratio (as defined in the
Credit Agreement) not to exceed 6.00:1.00, measured as of the last day of each fiscal quarter. The total net leverage ratio of the
Company did not exceed this threshold as of September 30, 2024.
The Credit Agreement provides for potential incremental revolving and term facilities at the Company’s request and at the
discretion of the lenders or other persons providing such incremental facilities, in each case on terms to be determined, and also
62
permits the Company to incur other secured or unsecured debt, in all cases subject to conditions and limitations as specified in
the Credit Agreement.
Furthermore, the Credit Agreement provides for customary events of default. Upon the occurrence and during the
continuance of an event of default, the maturity of the loans under the Credit Agreement may accelerate and the administrative
agent and lenders under the Credit Agreement may exercise other rights and remedies available at law or under the loan
documents, including with respect to the collateral securing, and guarantees of, the Company’s obligations under the Credit
Agreement.
The Company’s obligations under the Credit Agreement are unconditionally guaranteed by its existing and subsequently
acquired or organized direct and indirect subsidiaries (other than immaterial subsidiaries, certain excluded subsidiaries and
subsidiaries the Company designates as unrestricted subsidiaries) and are secured by security interests in substantially all of the
Company’s assets and the assets of its subsidiary guarantors, but excluding, in each case, real property.
Old Credit Agreement
On October 21, 2019, BellRing LLC entered into a credit agreement (as subsequently amended, the “Old Credit
Agreement”) which provided for a term B loan facility in an aggregate original principal amount of $700.0 (the “Term B
Facility”) and a revolving credit facility in an aggregate principal amount of up to $200.0 (the “Old Revolving Credit Facility”),
with the commitments under the Old Revolving Credit Facility to be made available to BellRing LLC in U.S. Dollars, Euros
and U.K. Pounds Sterling. Letters of credit were available under the Old Credit Agreement in an aggregate amount of up to
$20.0.
On March 10, 2022, with certain of the proceeds from the transactions related to the Spin-off, BellRing LLC repaid the
aggregate outstanding principal balance of $519.8 on its Term B Facility and terminated all obligations and commitments under
the Old Credit Agreement. The Company recorded a loss of $17.6 in the year ended September 30, 2022, which was included in
“Loss on extinguishment of debt, net” in the Consolidated Statements of Operations. This loss included (i) a $6.9 write-off of
unamortized discounts and debt extinguishment fees, (ii) a $6.1 write-off of unamortized net hedging losses recorded within
accumulated OCI related to the Term B Facility and (iii) a $4.6 write-off of debt issuance costs and deferred financing fees.
Following the termination of the Old Credit Agreement, BellRing LLC and the guarantors had no further obligations under the
Old Credit Agreement and the related guarantees other than customary indemnification obligations which continue.
The Term B Facility required quarterly scheduled amortization payments of $8.75 which began on March 31, 2020. Interest
was paid on each Interest Payment Date (as defined in the Old Credit Agreement) during the period prior to the termination of
the Old Credit Agreement. The Term B Facility contained customary mandatory pre-payment provisions, and during the year
ended September 30, 2022 and prior to the termination of the Old Credit Agreement, the Company repaid $81.4 on its Term B
Facility as a mandatory prepayment from fiscal 2021 excess cash flow (as defined in the Old Credit Agreement), which was in
addition to the scheduled amortization payments.
There were no borrowings under or repayments on the Old Revolving Credit Facility during the year ended September 30,
2022, prior to the facility being terminated.
Estimated Future Payments
As of September 30, 2024, there are no expected principal payments on the Company’s debt for the next five fiscal years
based on the debt maturity dates. Any future borrowings under the Revolving Credit Facility will be required to be repaid on or
before the March 2027 maturity date under the Credit Agreement. Estimated future interest payments on the Company’s debt
through fiscal 2029 are expected to be $295.5 (with $59.4 expected in fiscal 2025) based on the interest rates at September 30,
2024.
NOTE 14 — COMMITMENTS AND CONTINGENCIES
Legal Proceedings
Joint Juice Litigation
In March 2013, a complaint was filed on behalf of a putative, nationwide class of consumers against Premier Nutrition in
the U.S. District Court for the Northern District of California seeking monetary damages and injunctive relief. The case asserted
that some of Premier Nutrition’s advertising claims regarding its Joint Juice line of glucosamine and chondroitin dietary
supplement beverages, which it discontinued in the first quarter of fiscal 2023, were false and misleading. In April 2016, the
district court certified a California-only class of consumers in this lawsuit (this lawsuit is hereinafter referred to as the
“California Federal Class Lawsuit”).
In 2016 and 2017, the lead plaintiff’s counsel in the California Federal Class Lawsuit filed ten additional class action
complaints in the U.S. District Court for the Northern District of California on behalf of putative classes of consumers under the
63
laws of Connecticut, Florida, Illinois, New Jersey, New Mexico, New York, Maryland, Massachusetts, Michigan and
Pennsylvania (the “Related Federal Actions”). These complaints contain factual allegations similar to the California Federal
Class Lawsuit, also seeking monetary damages and injunctive relief. The action on behalf of New Jersey consumers was
voluntarily dismissed. Trial in the action on behalf of New York consumers (the “New York Case”) was held beginning in May
2022, and the jury delivered its verdict in favor of plaintiff in June 2022. In August 2022, the Court entered a judgment in that
case in favor of plaintiff in the amount of $12.9, which includes statutory damages and prejudgment interest, and in August
2023, the Court entered a judgment awarding plaintiff $7.9 in attorney’s fees and costs. In October 2022, each plaintiff and
Premier Nutrition filed Notices of Appeal to the Ninth Circuit on the damages award and in December 2023 Premier Nutrition
filed its Notice of Appeal to the Ninth Circuit on the attorney’s fees award. In August 2024, the Court of Appeals issued an
opinion on the damages award affirming the trial court’s decision on liability, vacating and remanding to the trial court for
further consideration its decision on calculated damages and reversing the trial court’s award of prejudgment interest to
plaintiff. Premier’s subsequent petition for en banc rehearing with the Ninth Circuit Court of Appeals was denied in October
2024. The other eight Related Federal Actions remain pending, and the court has certified individual state classes in each of
those cases (except New Mexico).
In April 2018, the district court dismissed the California Federal Class Lawsuit with prejudice. This dismissal was upheld
on appeal by the U.S. Court of Appeals for the Ninth Circuit in 2020, and plaintiff’s petition for an en banc rehearing by the
Ninth Circuit was denied.
In September 2020, the same lead counsel re-filed the California Federal Class Lawsuit against Premier Nutrition in
California Superior Court for the County of Alameda, alleging identical claims and seeking restitution and injunctive relief on
behalf of the same putative class of California consumers as the California Federal Class Lawsuit. In March 2023, the Alameda
Superior Court granted in part and denied in part Premier Nutrition’s motion for judgment based on res judicata and in May
2023, the Court reaffirmed its ruling. In July 2023, Premier Nutrition filed a petition for writ of mandamus in the California
Court of Appeal, which writ was denied in March 2024. In November 2023, the Court certified the case as a class action. Trial
is currently stayed pending the resolution of the appeal in the New York Case.
In January 2019, the same lead counsel filed an additional class action complaint against Premier Nutrition in California
Superior Court for the County of Alameda, alleging claims similar to the above actions and seeking monetary damages and
injunctive relief on behalf of a putative class of California consumers, beginning after the California Federal Class Lawsuit
class period. In July 2020, the court issued an order certifying a statewide class. Premier Nutrition moved for summary
judgment on July 7, 2023, which motion remains pending. Trial is currently stayed pending the resolution of the appeal in the
New York Case.
The Company continues to vigorously defend these cases and intends to appeal any adverse judgements and awards of
damages. The Company does not believe that the ultimate resolution of these cases will have a material adverse effect on its
consolidated financial condition, results of operations or cash flows.
During the years ended September 30, 2023 and 2022, the Company expensed $5.0 and $7.5, respectively, related to the
legal matter and plaintiff legal fees in connection with the Joint Juice litigation, which was included in “Selling, general and
administrative expenses” on the Consolidated Statements of Operations. Other than legal fees, no expense related to this
litigation was incurred during the year ended September 30, 2024. At both September 30, 2024 and 2023, the Company had an
estimated liability of $21.0 related to these matters that was included in “Other current liabilities” on the Consolidated Balance
Sheets.
Protein Products Class Litigation
In June 2023, a complaint was filed on behalf of a putative, nationwide class of consumers against the Company and
Premier Nutrition in the U.S. District Court for the Northern District of California. The complaint alleges that Premier Nutrition
engages in fraud and false advertising (via alleged affirmative representations and omissions) regarding its RTD protein shakes
and protein powders by marketing the products as good sources of nutrition and protein when the products contain (or have a
material risk of containing) high levels of undisclosed lead (this lawsuit is hereinafter referred to as the “Protein Products Class
Lawsuit”). Plaintiffs seek monetary remedies for economic injury (products are allegedly worth less than what was paid for
them), as well as injunctive relief. The Protein Products Class Lawsuit alleges that high levels of lead pose serious safety risks,
but does not allege that any plaintiff or putative class member suffered personal injuries and does not seek any remedies for
personal injuries.
The Company and Premier Nutrition filed a motion to dismiss this case in August 2023, which motion was granted in part
and denied in part. Plaintiffs filed an amended complaint in July 2024 and in August 2024 the Company and Premier Nutrition
filed a motion to dismiss the amended complaint, which motion is pending. The Company intends to vigorously defend the
case, including appealing any adverse judgement or award. The Company does not believe that the ultimate resolution of the
64
Protein Products Class Lawsuit will have a material adverse effect on its consolidated financial condition, results of operations
or cash flows.
Other than legal fees, no expense related to the Protein Products Class Lawsuit was incurred during the years ended
September 30, 2024, 2023 or 2022.
California Proposition 65 Notice re Lead in Protein Products
On June 7, 2023, the Fitzgerald Joseph LLP law firm (the same firm that filed the Protein Products Class Lawsuit) issued a
60-Day Notice of Intent to Sue under California’s Safe Water and Toxic Enforcement Act (Proposition 65) for alleged violation
of Proposition 65 with respect to lead levels in Premier Nutrition’s RTD protein shakes and protein powders (this matter is
hereinafter referred to as the “Protein Products Prop 65 Notice”).
Premier Nutrition intends to vigorously defend against the Protein Products Prop 65 Notice. The Company does not believe
that the ultimate resolution of the Protein Products Prop 65 Notice will have a material adverse effect on its consolidated
financial condition, results of operations or cash flows.
Other than legal fees, no expense related to the Protein Products Prop 65 Notice was incurred during the years ended
September 30, 2024, 2023 or 2022.
Other
The Company is subject to various other legal proceedings and actions arising in the normal course of business. In the
opinion of management, based upon the information presently known, the ultimate liability, if any, arising from such pending
legal proceedings, as well as from asserted legal claims and known potential legal claims which are likely to be asserted, taking
into account established accruals for estimated liabilities (if any), are not expected to be material individually or in the
aggregate to the consolidated financial condition, results of operations or cash flows of the Company. In addition, although it is
difficult to estimate the potential financial impact of actions regarding expenditures for compliance with regulatory matters, in
the opinion of management, based upon the information currently available, the ultimate liability arising from such compliance
matters is not expected to be material to the consolidated financial condition, results of operations or cash flows of the
Company.
NOTE 15 — STOCK-BASED COMPENSATION
The Company’s employees participate in the BellRing Brands, Inc. Long-Term Incentive Plan (the “BellRing Long-Term
Incentive Plan”). Awards issued under the BellRing Long-Term Incentive Plan have a maximum term of 10 years, provided,
however, that the Corporate Governance and Compensation Committee of BellRing’s Board of Directors may, in its discretion,
grant awards with a longer term to participants who are located outside of the U.S. On September 12, 2024, the Company
registered an additional 6.0 million shares reserved for issuance under the BellRing Long-Term Incentive Plan. At September
30, 2024 there were 7.3 million shares available to be issued for stock-based compensation awards under the BellRing Long-
Term Incentive Plan.
In connection with the Spin-off and the related Merger, all outstanding unexercised and unexpired options to purchase
shares of Old BellRing Class A Common Stock, outstanding restricted stock units with respect to shares of Old BellRing
Class A Common Stock and other equity awards with respect to shares of Old BellRing Class A Common Stock outstanding
under the BellRing Long-Term Incentive Plan (the “Equity Awards”), whether or not exercisable or vested, were assumed by
BellRing based on the terms and subject to the conditions set forth in the Transaction Agreement. Additionally, the Board of
Directors of BellRing approved adjustments to the terms of the outstanding Equity Awards to preserve the intrinsic value of the
awards. The adjustments to the Equity Awards were based on the volume weighted average price of Old BellRing Class A
Common Stock during the five trading day period prior to and including March 10, 2022 and the volume weighted average
price of BellRing Common Stock during the five trading day period immediately following March 10, 2022. The Equity
Awards adjustments made in connection with the Spin-off had an immaterial impact on the Company’s Consolidated
Statements of Operations for the years ended September 30, 2024, 2023 and 2022.
During the years ended September 30, 2024, 2023 and 2022, total compensation cost for BellRing’s non-cash stock-based
compensation awards recognized was $21.0, $14.2 and $9.8, respectively, and the related recognized deferred tax benefit was
$2.0, $1.6 and $1.2, respectively. As of September 30, 2024, the total compensation cost related to BellRing’s nonvested awards
not yet recognized was $26.8, which is expected to be recognized over a weighted-average period of 1.0 year.
65
Stock Options
Information about stock options is summarized in the following table.
in millions, except options or where otherwise indicated
Stock Options
Weighted-
Average
Exercise
Price Per
Share
Weighted-
Average
Remaining
Contractual
Term in Years
Aggregate
Intrinsic
Value
Outstanding at September 30, 2023
258,987 $
17.74
Granted
—
—
Exercised
—
—
Forfeited
—
—
Expired
—
—
Outstanding at September 30, 2024
258,987
17.74
5.80 $
11.1
Vested and expected to vest as of September 30, 2024
258,987
17.74
5.80
11.1
Exercisable at September 30, 2024
258,987
17.74
5.80
11.1
The fair value of each stock option was estimated on the date of grant using the Black-Scholes Model. The Company used
the simplified method for estimating a stock option term as it did not have sufficient historical stock options exercise experience
upon which to estimate an expected term. The expected term is estimated based on the award’s vesting period and contractual
term. Expected volatilities are based on historical volatility trends and other factors. The risk-free rate is the interpolated
U.S. Treasury rate for a term equal to the expected term. There were no stock options granted during the years ended September
30, 2024, 2023 or 2022.
The total intrinsic value of stock options exercised was $0.1 in the year ended September 30, 2022, and the Company
received proceeds from the exercise of stock options of $0.5 during the year ended September 30, 2022. There were no stock
options exercised during the years ended September 30, 2024 or 2023.
Restricted Stock Units (“RSUs”)
Information about RSUs is summarized in the following table.
RSUs
Weighted-
Average
Grant Date Fair
Value Per
Share
Nonvested at September 30, 2023
465,231 $
24.06
Granted
232,060
47.00
Vested
(240,181)
23.11
Forfeited
(23,850)
28.53
Nonvested at September 30, 2024
433,260
36.63
The grant date fair value of each RSU was determined based upon the closing price of the Company’s common stock on
the date of grant. The weighted-average grant date fair value of nonvested RSUs was $36.63, $24.06 and $21.23 at September
30, 2024, 2023 and 2022, respectively. The total vest date fair value of RSUs that vested during fiscal 2024, 2023 and 2022 was
$11.8, $7.8 and $5.2, respectively.
66
Performance Restricted Stock Units (“PRSUs”)
Information about PRSUs is summarized in the following table.
PRSUs
Weighted-
Average
Grant Date Fair
Value Per
Share
Nonvested at September 30, 2023
551,281 $
42.66
Granted
221,913
81.42
Vested
—
—
Forfeited
—
—
Nonvested at September 30, 2024
773,194
53.79
The Company grants PRSUs to certain employees and directors. These awards will be earned by comparing BellRing’s
total shareholder return (“TSR”) during a period of approximately three years to the respective TSRs of companies in a
performance peer group. Based upon BellRing’s ranking in its performance peer group when comparing TSRs, a recipient of
the PRSU grant may earn a total award ranging from 0% to 260% of the target award. The fair value of each PRSU was
estimated on the grant date using a Monte Carlo simulation.
The weighted-average assumptions for PRSUs granted during the years ended September 30, 2024, 2023 and 2022 are
summarized in the table below.
2024
2023
2022
Expected term
3 years
3 years
3 years
Expected stock price volatility
39.4%
46.8%
49.6%
Risk-free interest rate
4.7%
4.1%
2.3%
Expected dividends
—%
—%
—%
Fair value (per PRSU)
$81.42
$45.26
$42.33
NOTE 16 — STOCKHOLDERS’ DEFICIT
The following table summarizes the Company’s repurchases of BellRing Common Stock subsequent to the Spin-off.
Year Ended September 30,
2024
2023
2022
Shares repurchased (in millions)
2.6
4.2
1.1
Average price per share (a)
$
56.12 $
29.56 $
23.17
Total share repurchase cost (b)
$
148.0 $
126.3 $
24.7
.
(a) Average price per share excludes accrued excise tax and broker’s commissions, which are included in “Total share repurchase cost”
within this table.
(b) “Purchases of treasury stock” in the Consolidated Statements of Cash Flows for the years ended September 30, 2024 and 2023 excluded
$1.4 and $0.8, respectively, of accrued excise tax that had not been paid as of September 30, 2024 and 2023, respectively.
The following table summarizes the Company’s repurchases of Old BellRing Class A Common Stock during the year
ended September 30, 2022 prior to the Spin-off.
Shares repurchased (in millions)
0.8
Average price per share (a)
$
23.34
Total share repurchase costs
$
18.1
(a) Average price per share excludes broker’s commissions, which are included in “Total share repurchase cost” within this table.
In connection with the Spin-off, 0.8 million shares of Old BellRing Class A Common Stock held in treasury stock
immediately prior to the Merger effective time were cancelled pursuant to the Transaction Agreement.
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ITEM 9.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
Not applicable.
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Our management, with our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”) of the Company, has
evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the
Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of September 30, 2024. Based on that evaluation, our
CEO and CFO concluded that, as of September 30, 2024, the Company's disclosure controls and procedures were effective to
provide reasonable assurance of achieving the desired control objectives.
Management's Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting as such
term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is
designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting principles.
As of September 30, 2024, management conducted an assessment of the effectiveness of the Company’s internal control
over financial reporting based upon the criteria set forth by the Committee of Sponsoring Organizations of the Treadway
Commission (COSO) in Internal Control - Integrated Framework (2013). Based on management’s assessment utilizing these
criteria, our management concluded that, as of September 30, 2024, our internal control over financial reporting was effective.
The effectiveness of our internal control over financial reporting as of September 30, 2024 has been audited by
PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in its report, which appears herein.
Changes in Internal Control Over Financial Reporting
Based on management’s evaluation, there were no changes in our internal control over financial reporting that occurred
during the quarter ended September 30, 2024 that have materially affected, or are reasonably likely to materially affect, our
internal control over financial reporting.
ITEM 9B.
OTHER INFORMATION
Rule 10b5-1 and Non-Rule 10b5-1 Trading Arrangements
During the three months ended September 30, 2024, no director or “officer,” as defined in Rule 16a-1(f) under the
Securities Exchange Act of 1934, as amended, of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or
“non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408 of Regulation S-K.
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers
Transaction Bonus Agreements
On November 18, 2024, the Compensation Committee (the “Committee”) of the Board of Directors of the Company
approved the Company’s entry into a transaction bonus agreement (a “Bonus Agreement”) with Darcy H. Davenport, CEO of
the Company, Paul A. Rode, CFO of the Company, Doug J. Cornille, Chief Growth Officer of Premier Nutrition, Craig L.
Rosenthal, Chief Legal Officer of the Company and Robin Singh, Senior Vice President, Operations of Premier Nutrition (each,
an “Executive”). Pursuant to each Bonus Agreement, upon the occurrence of a “change in control” (as defined in the Bonus
Agreement), each Executive will be entitled to receive a cash payment equal to 100% of the Executive’s annual salary (the
“Transaction Bonus”).
The Transaction Bonus will be paid in a lump sum upon or within 30 days following the change in control, subject to the
Executive’s continued employment through the payment date. However, if an Executive’s employment is terminated without
“cause” or the Executive resigns for “good reason” (each as defined in the Bonus Agreement), in either case, prior to the
payment date but following the date the Company has entered into an agreement the consummation of which would result in a
change in control, the Executive will remain entitled to receive the Transaction Bonus upon or within 30 days following the
change in control.
68
The foregoing description of the Bonus Agreement with each Executive does not purport to be complete and is qualified in
its entirety by reference to the complete text of the Bonus Agreement, a copy of which is filed as Exhibit 10.14 hereto and is
incorporated by reference herein.
Gross-Up Agreements
In addition, on November 18, 2024, the Committee approved the Company’s entry into an agreement (an “Agreement”)
with each Executive. Pursuant to each Agreement, if it is determined that an Executive would be subject to the excise tax
imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), as a result of any payment in the
nature of compensation to or for the benefit of an Executive, the Company will pay or caused to be paid to the Executive a
gross-up payment. The gross-up payment will be in an amount sufficient to put the Executive in the same after-tax position as
though the excise tax under Section 4999 of the Code did not apply.
The foregoing description of the Agreement with each Executive does not purport to be complete and is qualified in its
entirety by reference to the complete text of the Agreement, a copy of which is filed as Exhibit 10.15 hereto and is incorporated
by reference herein.
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
Not applicable.
69
PART III
ITEM 10.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Information under the headings “Election of Directors,” “Corporate Governance - Board Meetings and Committees,”
“Corporate Governance - Nomination Process for Election of Directors,” and “Security Ownership of Certain Stockholders -
Delinquent Section 16(a) Reports” in our Proxy Statement for the 2025 Annual Meeting of Stockholders to be filed with the
Securities and Exchange Commission within 120 days of the year ended September 30, 2024 (the “2025 Proxy Statement”) is
hereby incorporated by reference.
Information regarding executive officers of the Company is included in the “Information about our Executive Officers”
section under “Business” in Item 1 of this report.
The Company has adopted a code of ethics, our Code of Conduct, applicable to our directors, officers and employees,
which sets forth the Company’s expectations for the conduct of business by our directors, officers and employees. The Code of
Conduct is available on the Company’s website at www.bellring.com. In the event the Company amends the Code of Conduct
or waivers of compliance are granted and it is determined that such amendments or waivers are subject to the disclosure
provisions of Item 5.05 of Form 8-K, the Company will post such amendments or waivers on its website or in a report on Form
8-K.
ITEM 11.
EXECUTIVE COMPENSATION
The information required by this Item, appearing under the headings “Compensation of Officers and Directors,”
“Compensation Committee Interlocks and Insider Participation” and “Corporate Governance and Compensation Committee
Report” in the 2025 Proxy Statement, is hereby incorporated by reference. The information contained in “Corporate
Governance and Compensation Committee Report” in the 2025 Proxy Statement shall not be deemed to be “filed” with the
Securities and Exchange Commission or subject to the liabilities of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), except to the extent that the Company specifically incorporates such information into a document filed under
the Securities Act of 1933, as amended, or the Exchange Act.
ITEM 12.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS
The information required by this Item, appearing under the headings “Security Ownership of Certain Stockholders” and
“Compensation of Officers and Directors - Equity Compensation Plan Information” in the 2025 Proxy Statement, is hereby
incorporated by reference.
ITEM 13.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The information required by this Item, appearing under the headings “Certain Relationships and Related Transactions” and
“Corporate Governance - Director Independence and Role of the Independent Lead Director” in the 2025 Proxy Statement, is
hereby incorporated by reference.
ITEM 14.
PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information required by this Item, appearing under the heading “Ratification of Appointment of Independent
Registered Public Accounting Firm” in the 2025 Proxy Statement, is hereby incorporated by reference.
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PART IV
ITEM 15.
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
Documents filed as a part of this report:
1.
Financial Statements. The following are filed as a part of this document under Item 8.
•
Report of Independent Registered Public Accounting Firm
•
Consolidated Statements of Operations for the years ended September 30, 2024, 2023 and 2022
•
Consolidated Statements of Comprehensive Income for the years ended September 30, 2024, 2023 and 2022
•
Consolidated Balance Sheets at September 30, 2024 and 2023
•
Consolidated Statements of Cash Flows for the years ended September 30, 2024, 2023 and 2022
•
Consolidated Statements of Stockholders’ Deficit for the years ended September 30, 2024, 2023 and 2022
•
Notes to Consolidated Financial Statements
2.
Financial Statement Schedules. None. Schedules not included have been omitted because they are not applicable
or not material or the required information is shown in the financial statements or notes thereto.
3.
Exhibits. See the following Exhibit Index.
71
Exhibit No
Description
*2.1
Transaction Agreement and Plan of Merger, dated as of October 26, 2021, by and among Post
Holdings, Inc., BellRing Brands, Inc., BellRing Distribution, LLC and BellRing Merger Sub
Corporation (Incorporated by reference to Exhibit 2.1 to the Company’s Form 8-K filed on October
27, 2021)
2.2
Amendment No. 1 to Transaction Agreement and Plan of Merger, dated as of February 28, 2022, by
and among Post Holdings, Inc., BellRing Brands, Inc., BellRing Distribution, LLC and BellRing
Merger Sub Corporation (Incorporated by reference to Exhibit 2.1 to the Company’s Form 8-K filed
on February 28, 2022)
3.1
BellRing Brands, Inc. Certificate of Incorporation (Incorporated by reference to Exhibit 3.1 to the
Company’s Second Form 8-K filed on March 10, 2022)
3.2
BellRing Brands, Inc. Bylaws (Incorporated by reference to Exhibit 3.2 to the Company’s Second
Form 8-K filed on March 10, 2022)
*4.1
Indenture, dated March 10, 2022, by and among BellRing Brands, Inc. (formerly BellRing
Distribution, LLC) and Computershare Trust Company, N.A., as trustee (Incorporated by reference
to Exhibit 4.1 to the Company’s Second Form 8-K filed on March 10, 2022)
4.2
Form of Note (Incorporated by reference to Exhibit A to Exhibit 4.1 to the Company’s Second Form
8-K filed on March 10, 2022)
4.3
Description of Company’s Registered Securities
†10.1
Amended BellRing Brands, Inc. 2019 Long-Term Incentive Plan (Incorporated by referenced to
Exhibit 10.1 to the Company’s Form 10-Q filed on February 7, 2023)
†10.2
Form of Omnibus Amendment to Restricted Stock Unit Agreement (Incorporated by referenced to
Exhibit 10.2 to the Company’s Form 10-Q filed on May 6, 2022)
†10.3
Form of Omnibus Amendment to Performance Restricted Stock Unit Agreement (Incorporated by
referenced to Exhibit 10.3 to the Company’s Form 10-Q filed on May 6, 2022)
†10.4
Form of Omnibus Amendment to Non-Qualified Stock Option Agreement (Incorporated by
referenced to Exhibit 10.4 to the Company’s Form 10-Q filed on May 6, 2022)
†10.5
Form of BellRing Brands, Inc. Executive Chairman Restricted Stock Unit Agreement (Incorporated
by referenced to Exhibit 10.5 to the Company’s Form 10-Q filed on May 6, 2022)
†10.6
Form of BellRing Brands, Inc. Executive Chairman Performance Restricted Stock Unit Agreement
(Incorporated by referenced to Exhibit 10.6 to the Company’s Form 10-Q filed on May 6, 2022)
†10.7
Amended and Restated Lock-Up Agreement, dated as of May 5, 2022, by and between BellRing
Brands, Inc. and Robert V. Vitale (Incorporated by referenced to Exhibit 10.7 to the Company’s Form
10-Q filed on May 6, 2022)
†10.8
Amended BellRing Brands, Inc. Deferred Compensation Plan For Directors (Incorporated by
referenced to Exhibit 10.8 to the Company’s Form 10-Q filed on May 6, 2022)
†10.9
Form of Severance and Change in Control Agreement (Incorporated by referenced to Exhibit 10.9 to
the Company’s Form 10-Q filed on May 6, 2022)
†10.10
Form of Indemnification Agreement
†10.11
BellRing Brands, Inc. Senior Management Bonus Program (Incorporated by reference to Exhibit
10.1 to the Company’s Form 8-K filed on November 22, 2019)
†10.12
Form of Non-Qualified Stock Option Agreement (Incorporated by reference to Exhibit 10.3 to the
Company’s Form 8-K filed on November 22, 2019)
†10.13
Form of Director Restricted Stock Unit Agreement (Incorporated by reference to Exhibit 10.4 to the
Company’s Form 8-K filed on November 22, 2019)
†10.14
Form of Transaction Bonus Agreement
†10.15
Form of Gross Up Agreement
*10.16
Amended and Restated Master Services Agreement, dated March 10, 2022, by and among Post
Holdings, Inc., BellRing Intermediate Holdings, Inc., BellRing Brands, Inc. and BellRing Brands,
LLC (Incorporated by reference to Exhibit 10.1 to the Company’s Second Form 8-K filed on March
10, 2022)
72
Exhibit No
Description
*10.17
Amendment to Amended and Restated Master Services Agreement, dated August 4, 2023, by and
among Post Holdings, Inc., BellRing Intermediate Holdings, Inc., BellRing Brands, Inc. and
BellRing Brands, LLC (Incorporated by reference to Exhibit 10.23 to the Company’s Form 10-Q
filed on August 8, 2023)
10.18
Registration Rights Agreement, dated March 10, 2022, by and among BellRing Brands, Inc.
(formerly known as BellRing Distribution, LLC), Post Holdings, Inc. and the other stockholders
party thereto from time to time (Incorporated by reference to Exhibit 10.2 to the Company’s Second
Form 8-K filed on March 10, 2022)
*10.19
Amended and Restated Employee Matters Agreement, dated March 10, 2022, by and among Post
Holdings, Inc., BellRing Intermediate Holdings, Inc. (formerly known as BellRing Brands, Inc.),
BellRing Brands, LLC and BellRing Brands, Inc. (formerly known as BellRing Distribution, LLC)
(Incorporated by reference to Exhibit 10.3 to the Company’s Second Form 8-K filed on March 10,
2022)
*10.20
Tax Matters Agreement, dated March 10, 2022, by and among BellRing Brands, Inc., Post Holdings,
Inc. and BellRing Intermediate Holdings, Inc. (Incorporated by reference to Exhibit 10.4 to the
Company’s Second Form 8-K filed on March 10, 2022)
10.21
Tax Receivable Agreement, dated October 21, 2019, by and among BellRing Brands, Inc., BellRing
Brands, LLC and Post Holdings, Inc. (Incorporated by reference to Exhibit 10.5 to the Company’s
Form 8-K filed on October 21, 2019)
*10.22
Credit Agreement, dated March 10, 2022, by and among BellRing Brands, Inc., JPMorgan Chase
Bank, N.A., as administrative agent and collateral agent, and each lender from time to time party
thereto (Incorporated by reference to Exhibit 10.5 to the Company’s Second Form 8-K filed on
March 10, 2022)
‡10.23
Amended and Restated Master Supply Agreement, dated as of July 1, 2023, by and between Premier
Nutrition Company, LLC and Fonterra (USA) Inc. (Incorporated by reference to Exhibit 10.24 to the
Company’s Form 10-Q filed on August 8, 2023)
‡10.24
MPC Purchase Commitment, dated as of July 1, 2023 by and between Premier Nutrition Company,
LLC and Fonterra (USA) Inc. (Incorporated by reference to Exhibit 10.25 to the Company’s Form
10-Q filed on August 8, 2023)
‡10.25
Stremick Heritage Foods, LLC, Jasper Products, LLC and Premier Nutrition Company
Manufacturing Agreement, dated as of December 14, 2022 (Incorporated by reference to Exhibit
10.22 to the Company’s Form 10-Q filed on February 7, 2023)
19.1
BellRing Brands, Inc. Insider Trading Policy
21.1
Subsidiaries of BellRing Brands, Inc.
23.1
Consent of PricewaterhouseCoopers LLP
24.1
Power of Attorney (Included under Signatures)
31.1
Certification of Darcy H. Davenport pursuant to Rule 13a-14(a), as adopted pursuant to Section 302
of the Sarbanes-Oxley Act of 2002, dated November 19, 2024
31.2
Certification of Paul A. Rode pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002, dated November 19, 2024
32.1
Certification of Darcy H. Davenport and Paul A. Rode, pursuant to 18 U.S.C. Section 1350 as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, dated November 19, 2024
101
Interactive Data File (Form 10-K for the year ended September 30, 2024 filed in iXBRL (Inline
eXtensible Business Reporting Language)). The financial information contained in the iXBRL-
related documents is “unaudited” and “unreviewed.”
104
The cover page from the Company’s Form 10-K for the year ended September 30, 2024, formatted in
iXBRL (Inline eXtensible Business Reporting Language) and contained in Exhibit 101
*
Exhibits and schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The Company agrees to
furnish supplementally to the Securities and Exchange Commission (the “SEC”) a copy of any omitted exhibit or
schedule upon request by the SEC.
†
These exhibits constitute management contracts, compensatory plans and arrangements.
‡
Certain portions of this document that constitute confidential information have been redacted in accordance
with Regulation S-K, Item 601(b)(10).
73
ITEM 16.
FORM 10-K SUMMARY
None.
74
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, BellRing Brands, Inc. has duly caused this
report to be signed on its behalf by the undersigned thereunto duly authorized.
BELLRING BRANDS, INC.
Date:
November 19, 2024
By: /s/ Darcy H. Davenport
Darcy H. Davenport
President and Chief Executive Officer
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Paul
A. Rode and Craig L. Rosenthal, and each of them, as his or her true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for him or her and in his or her name, place, and stead, in any and all capacities, to sign any and all
amendments to this report, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each
and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she
might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or their substitute or substitutes
may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the dates indicated.
Signature
Title
Date
/s/ Darcy H. Davenport
President and Chief Executive Officer and Director
(Principal Executive Officer)
November 19, 2024
Darcy H. Davenport
/s/ Paul A. Rode
Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer)
November 19, 2024
Paul A. Rode
/s/ Robert V. Vitale
Executive Chairman of the Board of Directors
November 19, 2024
Robert V. Vitale
/s/ Shawn W. Conway
Director
November 19, 2024
Shawn W. Conway
/s/ Thomas P. Erickson
Director
November 19, 2024
Thomas P. Erickson
/s/ Jennifer Kuperman Johnson
Director
November 19, 2024
Jennifer Kuperman Johnson
/s/ Chonda J. Nwamu
Director
November 19, 2024
Chonda J. Nwamu
/s/ Elliot H. Stein, Jr.
Director
November 19, 2024
Elliot H. Stein, Jr.
[THIS PAGE INTENTIONALLY LEFT BLANK]
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Corporate and Stockholder Information
Executive Officers
Darcy H. Davenport
President and Chief Executive Officer
Paul A. Rode
Chief Financial Officer
Craig L. Rosenthal
Chief Legal Officer and
Chief Compliance Officer
Doug J. Cornille
Chief Growth Officer of Premier Nutrition
Robin Singh
Chief Supply Chain Officer of
Premier Nutrition
Board of Directors
Darcy H. Davenport
Shawn W. Conway
Thomas P. Erickson
Jennifer Kuperman
Chonda J. Nwamu
Elliot H. Stein, Jr.
Robert V. Vitale, Chairman
Notice of Annual Meeting:
The 2025 Annual Meeting of
Stockholders will be held virtually
at 9:00 a.m. Central Time, Tuesday,
January 28, 2025.
Transfer Agent and Registrar:
Computershare Trust Company, N.A.
computershare.com
Stockholder Telephone Calls:
Operators are available Monday-Friday,
8:30 a.m. to 5:00 p.m. Central Time.
An interactive automated system is
available around the clock daily.
Inside the U.S.:
877-498-8861
Outside the U.S.: 312-360-5193
Mailing Address:
For questions regarding stock transfer,
change of address or lost certificates
by regular mail:
Computershare Trust Company, N.A.
PO Box 43006
Providence, RI 02940-3006
To Deliver Stock Certificates
by Courier:
Computershare Trust Company, N.A.
150 Royall St.
Canton, MA 02021
Independent Registered Public
Accounting Firm:
PricewaterhouseCoopers LLP
Corporate Headquarters:
BellRing Brands, Inc.
2503 S. Hanley Rd.
St. Louis, MO 63144
314-644-7600
bellring.com
Additional Information:
You can access financial and other
information about BellRing Brands, Inc.
at bellring.com, including press releases
and proxy materials; Forms 10-K, 10-Q
and 8-K as filed with the Securities and
Exchange Commission; and information
on corporate governance such as our
Code of Conduct and charters of Board
committees. You can also request that any
of these materials be mailed to you at no
charge by calling or writing:
BellRing Brands, Inc.
Attn: Stockholder Services
2503 S. Hanley Rd.
St. Louis, MO 63144
314-644-7600
1. Certain financial measures presented herein are non-GAAP measures,
1. Certain financial measures presented herein are non-GAAP measures,
including Adjusted EBITDA, Adjusted net earnings available to common
including Adjusted EBITDA, Adjusted net earnings available to common
shareholders and Adjusted diluted earnings per common share. Non-GAAP
shareholders and Adjusted diluted earnings per common share. Non-GAAP
measures are not prepared in accordance with U.S. generally accepted
measures are not prepared in accordance with U.S. generally accepted
accounting principles (“GAAP”), as they exclude certain items, and may not
accounting principles (“GAAP”), as they exclude certain items, and may not
be comparable to similarly titled measures of other companies. Management
be comparable to similarly titled measures of other companies. Management
uses certain non-GAAP measures, including Adjusted EBITDA, as key
uses certain non-GAAP measures, including Adjusted EBITDA, as key
metrics in the evaluation of underlying company performance, in making
metrics in the evaluation of underlying company performance, in making
financial, operating and planning decisions, and, in part, in the determination
financial, operating and planning decisions, and, in part, in the determination
of bonuses for its executive officers and employees. Management believes the
of bonuses for its executive officers and employees. Management believes the
use of non-GAAP measures, including Adjusted EBITDA, provides increased
use of non-GAAP measures, including Adjusted EBITDA, provides increased
transparency and assists investors in understanding the underlying operating
transparency and assists investors in understanding the underlying operating
performance of BellRing and in the analysis of ongoing operating trends.
performance of BellRing and in the analysis of ongoing operating trends.
BellRing believes Adjusted net earnings available to common shareholders
BellRing believes Adjusted net earnings available to common shareholders
and Adjusted diluted earnings per common share are useful to investors in
and Adjusted diluted earnings per common share are useful to investors in
evaluating BellRing’s operating performance because they exclude items that
evaluating BellRing’s operating performance because they exclude items that
affect the comparability of BellRing’s financial results and could potentially
affect the comparability of BellRing’s financial results and could potentially
distort an understanding of the trends in business performance. Adjusted
distort an understanding of the trends in business performance. Adjusted
net earnings available to common shareholders and Adjusted diluted
net earnings available to common shareholders and Adjusted diluted
earnings per common share are adjusted for the following items: accelerated
earnings per common share are adjusted for the following items: accelerated
amortization; loss on extinguishment and refinancing of debt, net; separation
amortization; loss on extinguishment and refinancing of debt, net; separation
costs; provision for legal matters; restructuring and facility closure costs
costs; provision for legal matters; restructuring and facility closure costs
including accelerated depreciation; resolution of dispute with former contract
including accelerated depreciation; resolution of dispute with former contract
manufacturer; foreign exchange gain/loss on intercompany loans; mark-to-
manufacturer; foreign exchange gain/loss on intercompany loans; mark-to-
market adjustments on commodity hedges; adjustment to tax receivable
market adjustments on commodity hedges; adjustment to tax receivable
agreement liability; noncontrolling interest adjustment and income tax. BellRing
agreement liability; noncontrolling interest adjustment and income tax. BellRing
believes that Adjusted EBITDA is useful to the reader in evaluating BellRing’s
believes that Adjusted EBITDA is useful to the reader in evaluating BellRing’s
operating performance and liquidity because (i) BellRing believes it is widely
operating performance and liquidity because (i) BellRing believes it is widely
used to measure a company’s operating performance without regard to
used to measure a company’s operating performance without regard to
items such as depreciation and amortization, which can vary depending upon
items such as depreciation and amortization, which can vary depending upon
accounting methods and the book value of assets, (ii) it presents a measure
accounting methods and the book value of assets, (ii) it presents a measure
of corporate performance exclusive of BellRing’s capital structure and the
of corporate performance exclusive of BellRing’s capital structure and the
method by which the assets were acquired and (iii) it is a financial indicator of
method by which the assets were acquired and (iii) it is a financial indicator of
a company’s ability to service its debt, as BellRing is required to comply with
a company’s ability to service its debt, as BellRing is required to comply with
certain covenants and limitations that are based on variations of EBITDA in
certain covenants and limitations that are based on variations of EBITDA in
its financing documents. Adjusted EBITDA reflects adjustments for income
its financing documents. Adjusted EBITDA reflects adjustments for income
tax expense/benefit; interest expense; net; depreciation and amortization
tax expense/benefit; interest expense; net; depreciation and amortization
including accelerated depreciation and amortization; loss on extinguishment
including accelerated depreciation and amortization; loss on extinguishment
and refinancing of debt, net; separation costs; stock-based compensation;
and refinancing of debt, net; separation costs; stock-based compensation;
provision for legal matters; restructuring and facility closure costs excluding
provision for legal matters; restructuring and facility closure costs excluding
accelerated depreciation; resolution of dispute with former contract
accelerated depreciation; resolution of dispute with former contract
manufacturer; foreign exchange gain/loss on intercompany loans; mark-to-
manufacturer; foreign exchange gain/loss on intercompany loans; mark-to-
market adjustments on commodity hedges; adjustments to tax receivable
market adjustments on commodity hedges; adjustments to tax receivable
agreement liability and net earnings attributable to redeemable noncontrolling
agreement liability and net earnings attributable to redeemable noncontrolling
interest. For a reconciliation of non-GAAP measures to the most directly
interest. For a reconciliation of non-GAAP measures to the most directly
comparable GAAP measure, see our press releases posted on our website.
comparable GAAP measure, see our press releases posted on our website.
2. Numerator Household Panel 52 weeks ended September 30, 2024.
2. Numerator Household Panel 52 weeks ended September 30, 2024.
3. Circana Total U.S. Multi Outlet + Convenience through September 29, 2024.
3. Circana Total U.S. Multi Outlet + Convenience through September 29, 2024.
4. PNC Equity Study, September 2024.
4. PNC Equity Study, September 2024.
5. TikTok platform data, November 2024.
5. TikTok platform data, November 2024.
6. Leading E-tailer consumption data, 13 weeks ended October 5, 2024.
6. Leading E-tailer consumption data, 13 weeks ended October 5, 2024.
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2503 South Hanley Road St. Louis, MO 63144
bellring.com