Company: THS
Filing Date: 2025-11-10
Form Type: 10-Q
Source: 0001320695-25-000107
Chunk: 11

Company: TreeHouse Foods, Inc.
Filing Date: 2025-11-10
Form: 10-Q
Item: Part I, Item 2
Chunk 11
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 freight and commission costs, and cost reduction activities.

Total Other Expense — Total other expense was $84.4 million in the first nine months of 2025 compared to $63.1 million in the first nine months of 2024, an increase in expense of $21.3 million. The change was due to an $18.2 million increase in interest expense primarily due to higher borrowings on our Revolving Credit Facility and an $8.0 million unfavorable change in non-cash mark-to-market impacts from hedging activities, driven by commodity contracts, primarily coffee, and interest rate swaps. This was partially offset by a favorable currency exchange rate impact of $6.4 million between the U.S. and Canada.

Income Taxes — Income taxes were recognized at an effective rate of 5.1% in the first nine months of 2025 compared to 21.5% recognized in the first nine months of 2024. The change in the Company's effective tax rate is primarily driven by the impairment of goodwill and changes in the amounts of executive compensation, both of which are not deductible for tax purposes.

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Our effective tax rate may change from period to period based on recurring and non-recurring factors including the jurisdictional mix of earnings, enacted tax legislation, state income taxes, settlement of tax audits, and the expiration of the statute of limitations in relation to unrecognized tax benefits.

Liquidity and Capital Resources

Management assesses the Company's liquidity in terms of its ability to generate cash to fund its operating, investing, and financing activities. The Company remains in a strong financial position, with resources available for reinvesting in existing businesses, conducting acquisitions, and managing its capital structure on a short and long-term basis.

Receivables Sales Program

The Company achieves a more efficient cash conversion cycle while strategically managing customer payment terms and counterparty risk through its Receivables Sales Program. Our Receivables Sales Program provides us timely and lower cost access to liquidity that is more effective than other working capital tools, including offering early payment discounts, negotiating shorter payment terms, or drawing on our Revolving Credit Facility.

Approximately $175.8 million was available under the Receivables Sales Program operating limit as of September 30, 2025. See Note 4 to our Condensed Consolidated Financial Statements for additional information regarding our Receivables Sales Program.

Revolving Credit Facility

If additional borrowings are needed, approximately $372.2 million was available under the Revolving Credit