BellRing: Premier Protein Drives Double-Digit Q3 Growth As Powders Move Towards Mainstream

BellRing Brands – the producer of Premier Protein and Dymatize brands – reported 15.6% net sales growth to $515.4 million in its Q3 earnings report this morning as the company works to build up demand and household penetration for its shakes and powders. Here’s the top-level view:

• Premier Protein net sales grew 19.8%, driven by a 19.2% increase in volume and a 0.6% increase in price/mix. Within that umbrella, Premier Protein RTD shake consumption was up 29% and powders were up 52%.
• Dymatize net sales fell 2.6%, fueled by a 4.4% increase in volume that was offset by a 7% decrease in price/mix.
• Gross profit was $189.9 million, or 36.8% of net sales, an increase of 39.6%, or $53.9 million, compared to $136 million, or 30.5% of net sales, in Q3 2023.
• SG&A expenses jumped to $64 million, or 14.4% of net sales, an increase of $18.9 million.

“We are pleased with our third quarter performance, with results ahead of our expectations and shake production delivering to plan. We saw greater-than-expected margin primarily lifted by

favorability in powder input costs,” said Darcy H. Davenport, president and CEO, in a statement.

During today’s earnings call, Davenport told investors that BellRing’s overall performance benefited from improved supply chain and distribution gains for Premier Protein. She also highlighted the brand’s strong RTD market share (21%) and distribution growth (33%), although both measures decelerated slightly at the end of the quarter due to temporary out-of-stocks.

Mass and ecommerce saw the highest channel growth, driven by strong velocities and the aforementioned distribution expansion. Club was the outlier, with flat dollar consumption growth resulting from temporary changes in the brand’s assortment.

Additionally, total household penetration for the brand’s RTD shakes grew 26%, finishing the quarter at an all-time high. Premier Protein’s powders also reached new household penetration highs.

Meanwhile, Dymatize powder consumption remained strong in mainstream FDM channels, but overall consumption declined 8%, weighed down by softness in the specialty channel and increased competition in ecommerce. To increase brand awareness, BellRing will increase investment in the brand’s U.S. marketing and promotion efforts – including an upcoming national campaign with NFL All-Pro running back Christian McAffrey of the San Francisco 49ers.

Based on its Q3 results, the company has upgraded its full-year guidance range for net sales to $1.96 billion to$2 billion (up from $1.93 billion to$1.99 billion) and adjusted EBITDA to $430 million to $440 million (previously $400 million to-$420 million).

Over the past few years, BellRing has been pushing existing commands for more capacity and, according to Davenport, its commands have now fully stabilized and will be able to pass on new efficiencies.

The parent company of Premier Protein and Dymatize, which believes it has “a lot of untapped potential,” plans to ramp up marketing efforts in the coming quarters. During this morning’s call, Davenport said she is confident the brand will help mainstream the powder category the same way it did the RTD category.

“Protein continues to have incredible tailwinds and high relevance with a broad swath of consumers. It is beneficial for almost every age depending on [consumers’] nutritional health goals,” Davenport said during today’s call. “The more we learn, the more we get excited about our future, given our brands’ mainstream appeal.”