Company: THS
Filing Date: 2025-11-10
Form Type: 10-Q
Source: 0001320695-25-000107
Chunk: 78

Company: TreeHouse Foods, Inc.
Filing Date: 2025-11-10
Form: 10-Q
Item: Part I, Item 1
Chunk 78
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 0.7%. The change in net sales from 2024 to 2025 was due to the following:

 DollarsPercent (In millions)Volume/mix$(113.2)(4.6)%Margin management(72.4)(3.0)Griddle recall service impacts(29.1)(1.2)Total volume/mix$(214.7)(8.8)%Business acquisition110.5 4.5 Pricing96.7 4.0 RTD business exit(17.1)(0.7)Product recall9.5 0.4 Foreign currency(2.9)(0.1)Total change in net sales$(18.0)(0.7)%Product recall/other(8.6)(0.4)Total change in adjusted net sales (1)$(26.6)(1.1)%

(1)Adjusted net sales is a Non-GAAP financial measure. Refer to the "Non-GAAP Measures" section for additional information.

The net sales decrease of 0.7% was primarily due to volume/mix related to broader macroeconomic consumption trends, distribution losses, planned margin management actions, service impacts related to the voluntary recall of frozen griddle products, and the RTD business exit. This was partially offset by the acquisition of the private brand tea business, favorable pricing to recover commodity inflation, and distribution gains.

Gross Profit — Gross profit as a percentage of net sales was 17.0% in the first nine months of 2025, compared to 15.2% in the first nine months of 2024, an increase of 1.8 percentage points. The increase is primarily due to $30.6 million of insurance recoveries received during 2025 related to voluntary product recalls, favorable margin from the Harris Tea acquisition, and supply chain savings initiatives. This was partially offset by unfavorable fixed cost absorption due to declining consumption trends. 

Total Operating Expenses — Total operating expenses were $644.6 million in the first nine months of 2025 compared to $348.9 million in the first nine months of 2024, an increase of $295.7 million. The increase in 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 compensation expense. This was partially offset