Sovos bests Wall Street sales expectations in first quarter post-IPO

LOUISVILLE — Sovos Brands Inc. (Nasdaq: SOVO), a formerly California-based food-brand company that planted its headquarters flag in Louisville this year just before going public, saw its sales grow in the third quarter, the company’s first since its initial public offering in September. 

The company — owner of Colorado-born brands Noosa Yoghurt LLC and waffle mix maker Birch Benders LLC, along with Rao’s Homemade Sauce and Michael Angelo’s frozen italian meals — posted sales of $178.7 million, up from $136.9 million in the same period last year and besting the FactSet consensus estimate of $169.3 million. 

Despite stronger sales, Sovos had a $4.6 million net loss, or 6 cents per share, after posting net income of $2.2 million, or 3 cents per share, last year.

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Still, adjusted EPS topped analysts’ estimates. 

“Dollar consumption of our brands in our three largest categories — pasta sauce, yogurt and frozen — increased by double digits during the quarter, demonstrating the momentum of our core businesses,” Sovos CEO Todd Lachman said in a prepared statement. “Under the leadership of the Sovos Brands team, we remain laser focused on increasing household penetration, successful category expansion and accretive acquisitions, and I am confident our industry-leading, profitable growth will create attractive shareholder returns long-term.”

Sovos is projecting net sales for the entirety of 2021 of $710 million to $715 million.

The company raised $263.2 million through its IPO, which was priced at $12 and qualified Sovos for unicorn status, a term used to describe startups that achieve valuations of at least $1 billion.

Sovos’ stock price, which eclipsed $15 in early trading Tuesday, is up more than 15% over the past month.