brbr-20210331

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

__________________

FORM 10-Q

__________________

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2021

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____ to _____

Commission File Number: 1-39093

BellRing Brands, Inc.

(Exact name of registrant as specified in its charter)


Delaware						83-4096323
(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)

(314) 644-7600

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A Common Stock, $0.01 par value per share	BRBR	New York Stock Exchange

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 is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

Class A Common Stock, $0.01 par value per share – 39,510,430 shares as of May 3, 2021

Class B Common Stock, $0.01 par value per share - 1 share as of May 3, 2021

Table of Contents

BELLRING BRANDS, INC.

QUARTERLY REPORT ON FORM 10-Q

TABLE OF CONTENTS


		Page
PART I.	FINANCIAL INFORMATION.

Item 1.	Financial Statements (Unaudited).	1

	Condensed Consolidated Statements of Operations (Unaudited).	1

	Condensed Consolidated Statements of Comprehensive Income (Unaudited).	2

	Condensed Consolidated Balance Sheets (Unaudited).	3

	Condensed Consolidated Statements of Cash Flows (Unaudited).	4

	Condensed Consolidated Statements of Stockholders’ Equity (Unaudited).	5

	Notes to Condensed Consolidated Financial Statements (Unaudited).	6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	16

Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	22

Item 4.	Controls and Procedures.	22

PART II.	OTHER INFORMATION.

Item 1.	Legal Proceedings.	23

Item 1A.	Risk Factors.	23

Item 6.	Exhibits.	24

	SIGNATURES.	25

Table of Contents

PART I. FINANCIAL INFORMATION.

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED).

BELLRING BRANDS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

(in millions, except per share data)


	Three Months Ended March 31,				Six Months Ended March 31,
	2021		2020		2021		2020
Net Sales	$	282.1	$	257.5	$	564.5	$	501.5
Cost of goods sold	195.1		169.3		385.6		322.0
Gross Profit	87.0		88.2		178.9		179.5
Selling, general and administrative expenses	48.2		47.5		86.5		84.0
Amortization of intangible assets	23.2		5.6		29.1		11.1


Other operating income, net	—		—		(0.1)		—
Operating Profit	15.6		35.1		63.4		84.4
Interest expense, net	11.3		14.3		24.1		25.9
Loss on refinancing of debt	1.5		—		1.5		—


Earnings before Income Taxes	2.8		20.8		37.8		58.5
Income tax expense	0.3		2.2		2.4		8.1
Net Earnings Including Redeemable Noncontrolling Interest	2.5		18.6		35.4		50.4
Less: Net earnings attributable to redeemable noncontrolling interest	1.9		14.4		27.0		40.2
Net Earnings Available to Class A Common Stockholders	$	0.6	$	4.2	$	8.4	$	10.2

Earnings per share of Class A Common Stock:
Basic	$	0.02	$	0.11	$	0.21	$	0.26
Diluted	$	0.02	$	0.11	$	0.21	$	0.26

Weighted Average shares of Class A Common Stock Outstanding:
Basic	39.5		39.4		39.5		39.4
Diluted	39.7		39.5		39.6		39.4

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

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BELLRING BRANDS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)

(in millions)


	Three Months Ended March 31,				Six Months Ended March 31,
	2021		2020		2021		2020
Net Earnings Including Redeemable Noncontrolling Interest	$	2.5	$	18.6	$	35.4	$	50.4
Hedging adjustments:
Net loss on derivatives	—		(11.0)		—		(10.4)
Reclassifications to net earnings	0.6		(0.2)		1.1		(0.2)

Foreign currency translation adjustments:
Unrealized foreign currency translation adjustments	(0.9)		(0.3)		—		0.2

Tax benefit on other comprehensive loss:
Net loss on derivatives	—		0.8		—		0.8

Total Other Comprehensive (Loss) Income Including Redeemable Noncontrolling Interest	(0.3)		(10.7)		1.1		(9.6)
Less: Comprehensive income attributable to redeemable noncontrolling interest	1.7		6.2		27.8		32.5
Total Comprehensive Income Available to Class A Common Stockholders	$	0.5	$	1.7	$	8.7	$	8.3

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

Table of Contents

BELLRING BRANDS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

(in millions)


	March 31, 2021		September 30, 2020
ASSETS
Current Assets
Cash and cash equivalents	$	33.2	$	48.7
Receivables, net	117.4		83.1
Inventories	148.2		150.5


Prepaid expenses and other current assets	9.1		7.9
Total Current Assets	307.9		290.2
Property, net	8.9		10.2
Goodwill	65.9		65.9
Intangible assets, net	245.2		274.3


Other assets	11.4		12.9
Total Assets	$	639.3	$	653.5

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
Current portion of long-term debt	$	73.2	$	63.8
Accounts payable	91.0		56.7

Other current liabilities	35.0		32.6
Total Current Liabilities	199.2		153.1
Long-term debt	539.6		622.6
Deferred income taxes	8.3		9.0

Other liabilities	26.0		29.8
Total Liabilities	773.1		814.5
Redeemable noncontrolling interest	2,301.4		2,021.6
Stockholders’ Equity
Preferred stock	—		—
Common stock	0.4		0.4



Accumulated deficit	(2,431.9)		(2,179.0)

Accumulated other comprehensive loss	(3.7)		(4.0)

Total Stockholders’ Equity	(2,435.2)		(2,182.6)
Total Liabilities and Stockholders’ Equity	$	639.3	$	653.5

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

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BELLRING BRANDS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(in millions)


	Six Months Ended March 31,
	2021		2020
Cash Flows from Operating Activities
Net earnings including redeemable noncontrolling interest	$	35.4	$	50.4
Adjustments to reconcile net earnings including redeemable noncontrolling interest to net cash provided by (used in) operating activities:
Depreciation and amortization	30.6		12.8

Unrealized gain on interest rate swaps	(1.4)		—
Loss on refinancing of debt	1.5		—


Non-cash stock-based compensation expense	2.2		1.1


Deferred income taxes	(0.7)		(3.4)
Other, net	2.8		2.5
Other changes in operating assets and liabilities:
Increase in receivables	(34.4)		(42.7)
Decrease (increase) in inventories	2.2		(12.9)
Increase in prepaid expenses and other current assets	(1.0)		(2.7)
Decrease in other assets	1.4		1.2
Increase (decrease) in accounts payable and other current liabilities	34.8		(11.4)
Increase in non-current liabilities	0.4		—
Net Cash Provided by (Used in) Operating Activities	73.8		(5.1)

Cash Flows from Investing Activities


Additions to property	(0.5)		(1.2)






Net Cash Used in Investing Activities	(0.5)		(1.2)

Cash Flows from Financing Activities
Proceeds from issuance of long-term debt	20.0		871.0

Proceeds from issuance of common stock, net of issuance costs	—		524.4


Repayments of long-term debt	(96.3)		(1,298.7)



Payments of debt issuance costs and deferred financing fees	—		(9.6)

Payment of debt refinancing fees	(1.5)		—


Distributions to Post Holdings, Inc., net	(10.7)		(9.5)

Other, net	(0.9)		—
Net Cash (Used in) Provided by Financing Activities	(89.4)		77.6
Effect of Exchange Rate Changes on Cash and Cash Equivalents	0.6		(0.1)
Net (Decrease) Increase in Cash and Cash Equivalents	(15.5)		71.2
Cash and Cash Equivalents, Beginning of Year	48.7		5.5
Cash and Cash Equivalents, End of Period	$	33.2	$	76.7

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

Table of Contents

BELLRING BRANDS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited)

(in millions)


	As Of and For The Three Months Ended March 31,				As Of and For The Six Months Ended March 31,
	2021		2020		2021		2020








Preferred Stock
Beginning and end of period	$	—	$	—	$	—	$	—
Common Stock
Beginning of period	0.4		0.4		0.4		—
Issuance of common stock	—		—		—		0.4
End of period	0.4		0.4		0.4		0.4
Additional Paid-in Capital
Beginning of period	—		0.3		—		—
Activity under stock and deferred compensation plans	0.1		—		(0.8)		—
Non-cash stock-based compensation expense	1.1		0.8		2.2		1.1
Redemption value adjustment to redeemable noncontrolling interest

SEC Form 10-Q filed by BellRing Brands, Inc.