8-K: Utz Brands Reports Strong Preliminary Q4, FY25 Adjusted EBITDA

Utz Brands announced preliminary Q4 and full-year 2025 results, highlighting robust Adjusted EBITDA growth and strong retail sales performance despite temporary net sales headwinds.

Summary

• Preliminary unaudited results for the fiscal fourth quarter and full fiscal year ended December 28, 2025, were announced.
• Q4 2025 Net Sales are expected to be in the range of $342 million to $343 million, representing an Organic Net Sales increase of between 0.3% and 0.6% versus Q4 2024.
• Q4 2025 Adjusted EBITDA is expected to be in the range of $62 million to $64 million, representing an increase of between 17% and 21% versus Q4 2024.
• Full Year 2025 Net Sales are expected to be in the range of $1,439 million to $1,440 million, representing an Organic Net Sales increase of between 2.4% and 2.5% versus full year 2024.
• Full Year 2025 Adjusted EBITDA is expected to be in the range of $216 million to $218 million, representing an increase of between 8% and 9% versus full year 2024.
• The Net Leverage Ratio was approximately 3.4x at fiscal year-end 2025.
• Branded Salty Snacks Retail Sales increased 3.5% in Q4 2025, outperforming the Salty Snack category's 1.1% growth.
• Retail Volumes increased 0.5% in Q4 2025, compared to 0.3% for the Salty Snack Category.
• The company's Power Four Brands (Utz, On the Border, Zapps, and Boulder Canyon) Retail Sales increased by 5.3% in Q4 2025.
• For the full year 2025, Branded Salty Snacks Retail Sales increased 2.9%, outperforming the Salty Snack Category that declined 0.5%.
• Full Year 2025 Retail Volumes increased 3.4% compared to a 0.9% decline for the Salty Snack Category.
• Full Year 2025 Power Four Brands Retail Sales increased by 5.0%.

Sentiment

Score: 8

Explanation: The company reported strong preliminary Adjusted EBITDA growth and significant outperformance in retail sales and volumes compared to the overall Salty Snack category. Despite temporary headwinds affecting net sales due to channel inventory adjustments, operational efficiency and cash generation were strong, leading to reduced leverage. The overall tone and results indicate robust underlying business health and effective management execution.

Positives

• Strong Adjusted EBITDA growth: Q4 increased 17-21% ($62M-$64M) and FY2025 increased 8-9% ($216M-$218M).
• Outperformed the Salty Snack category in Retail Sales and Retail Volumes for both Q4 and the full year 2025.
• Q4 Retail Sales grew 3.5%, significantly higher than the category's 1.1% growth.
• Full Year Retail Sales grew 2.9%, contrasting with the category's 0.5% decline.
• Power Four Brands demonstrated robust growth, with Retail Sales increasing 5.3% in Q4 and 5.0% for the full year.
• Achieved significant progress on Adjusted EBITDA Margin expansion during Q4 and throughout 2025.
• Improved cash generation led to a reduced Net Leverage Ratio of approximately 3.4x at fiscal year-end.
• Continued effective execution of productivity and operational efficiency programs.

Negatives

• Net Sales lagged strong Retail Sales in the second half of Q4 2025 due to channel partners reducing inventories.
• Channel partner inventory reductions were attributed to factors including SNAP payment delays and a government shutdown.

Risks

• The preliminary financial results are unaudited and subject to completion of the company's financial closing procedures and review by independent auditors, and may change materially.
• Forward-looking statements are subject to a number of risks and uncertainties, and actual business results may differ materially from current expectations.
• Quantitative reconciliations for non-GAAP financial measures like Adjusted EBITDA and Net Leverage Ratio are not available without unreasonable efforts at this preliminary stage.

Future Outlook

The company expects to provide detailed Q4 and full-year 2025 financial results and 2026 guidance on February 12, 2026. Management remains on-track with growth initiatives, including a California expansion in early 2026, and accelerating free cash flow will continue to be a key focus.

Management Comments

• "We were pleased with how we ended 2025 with Retail Sales growth of approximately 3.5% in the fourth quarter, importantly, in a Salty Snack category that has returned to growth, up 1.1% in the fourth quarter." Howard Friedman, CEO.
• "Net Sales lagged our strong Retail Sales as our channel partners reduced inventories during the second half of the quarter due to a variety of factors including SNAP payment delays and the government shutdown. Shipment trends normalized as we exited the year." Howard Friedman, CEO.
• "Further, we continued to execute well on our productivity and operational efficiency programs and remain on-track with our growth initiatives such as our California expansion in early 2026." Howard Friedman, CEO.
• "The Company made significant progress on Adjusted EBITDA Margin expansion in the fourth quarter and throughout 2025." BK Kelley, EVP and CFO.
• "Our strong improvement in cash generation allowed us to exit the year at approximately 3.4x Net Leverage. Accelerating free cash flow will continue to be an area of focus going forward." BK Kelley, EVP and CFO.

Industry Context

The Salty Snack category returned to growth in the fourth quarter of 2025, increasing by 1.1%. Utz Brands significantly outperformed this trend, demonstrating strong market penetration and brand strength in a recovering market.

Comparison to Industry Standards

• Utz's Branded Salty Snacks Retail Sales increased 3.5% in Q4 2025, significantly outperforming the overall Salty Snack Category's 1.1% growth.
• Utz's Branded Salty Snacks Retail Volumes increased 0.5% in Q4 2025, compared to the category's 0.3% increase.
• For the full year 2025, Utz's Branded Salty Snacks Retail Sales increased 2.9%, while the overall Salty Snack Category declined 0.5%.
• For the full year 2025, Utz's Branded Salty Snacks Retail Volumes increased 3.4%, compared to a 0.9% decline for the Salty Snack Category.
• The company's 'Power Four Brands' (Utz, On the Border, Zapps, and Boulder Canyon) showed even stronger performance, with Retail Sales increasing 5.3% in Q4 and 5.0% for the full year.

Stakeholder Impact

• Shareholders: Positive outlook due to strong operational performance, EBITDA growth, and reduced leverage, despite the preliminary nature of results. Future guidance is expected.
• Employees: Positive implications from continued execution on productivity and operational efficiency programs, and growth initiatives like the California expansion.
• Customers: Continued availability of popular snack brands, with growth initiatives aimed at expanding reach.
• Channel Partners: Experienced temporary inventory reductions in Q4, but shipment trends normalized by year-end.

Next Steps

• Participate in a fireside chat at the 28th Annual ICR Conference in Orlando, FL on January 13, 2026.
• Report detailed Q4 and full-year 2025 financial results on February 12, 2026.
• Provide 2026 guidance on February 12, 2026.
• Continue with growth initiatives, including a California expansion in early 2026.
• Focus on accelerating free cash flow going forward.

Key Dates

Recommendation

The preliminary results indicate strong operational execution and financial health. Utz Brands significantly outperformed the broader Salty Snack category in retail sales and volumes, demonstrating market share gains and brand strength. The robust Adjusted EBITDA growth and improved net leverage ratio highlight effective cost management and cash generation. While net sales faced temporary headwinds from channel inventory adjustments, these factors are described as normalizing. The company's strategic initiatives, including California expansion, and focus on free cash flow suggest continued positive momentum. These factors, combined with the company's position as a 'small-cap growth and value Staples equity,' make it an attractive investment.

Keywords

Utz Brands, UTZ, Salty Snacks, Financial Results, Preliminary Results, Q4 2025, FY 2025, Adjusted EBITDA, Net Sales, Retail Sales, Leverage Ratio, Consumer Staples, Food & Beverage