Company: THS
Filing Date: 2025-11-10
Form Type: 10-Q
Source: 0001320695-25-000107
Chunk: 7

Company: TreeHouse Foods, Inc.
Filing Date: 2025-11-10
Form: 10-Q
Item: Part I, Item 2
Chunk 7
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 expense is primarily due to a non-cash goodwill impairment loss of $289.7 million recognized in the third quarter of 2025, increased restructuring costs primarily from severance and professional fees, an increase in operating expenses from the Harris Tea acquisition, and higher employee incentive compensation expense. This was partially offset by cost reduction activities in 2025.Total Other Expense — Total other expense was $13.4 million in the third quarter of 2025 compared to $36.1 million in the third quarter of 2024, a decrease in expense of $22.7 million. The decrease was due to a $32.2 million favorable change in non-cash mark-to-market impacts from hedging activities, driven by interest rate swaps and commodity contracts, primarily coffee. This was partially offset by an increase of $7.9 million in interest expense primarily due to an increase in borrowings on our Revolving Credit Facility and an unfavorable currency exchange rate impact of $3.5 million between the U.S. and Canada.Income Taxes — Income taxes were recognized at an effective rate of 0.6% in the third quarter of 2025 compared to 20.9% recognized in the third quarter 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. 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.

36

Results of Operations 

The following table presents certain information concerning our financial results, including information presented as a percentage of consolidated net sales:

Nine Months Ended September 30, 20252024Increase / (Decrease)(Dollars in millions, except per share amounts)DollarsPercentDollarsPercent$ Change% ChangeNet sales$2,430.3 100.0 %$2,448.3 100.0 %$(18.0)(0.7)%Cost of sales2,018.0 83.0 2,076.8 84.8 (58.8)(2.8)Gross profit412.3 17.0 371.5 15.2 40.8 11.0 Operating expenses: Selling and distribution108