Sovos sales see 10% jump, but inflation bites bottom line

LOUISVILLE — Sovos Brands Inc. (Nasdaq: SOVO), a formerly California-based food-brand company that last year planted its headquarters flag in Louisville, posted increased sales in the first quarter of 2022, but inflation kept the company’s earnings from beating last year’s total for the period.

Net sales were $209.9 million, a 10.9% increase over the prior-year period.

Adjusted net income was $13.8 million, or 14 cents per diluted share.

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That beat the Zacks Consensus Estimate of 13 cents but failed to meet last year’s first-quarter earnings figure of $20.8 million. 

“As inflationary pressures and supply chain disruptions intensified throughout the quarter, market dynamics dictate further action,” Sovos CEO Todd Lachman said in a prepared statement. “In order to help offset these inflationary pressures we have announced further pricing actions, while continuing to execute against our robust pipeline of productivity initiatives. Despite the volatile operating environment, we remain confident in our ability to deliver on our financial targets in 2022 and stakeholder value-creation over the long-term.”

Sovos’ full-year 2022 revenue guidance is $800 million to $815 million.

The company’s stock finished trading Thursday at $13.96, down 7.85%.