Corporate Profiles - 2020 - 104

COMPANY OVERVIEW

Post Holdings, Inc.
Ramps up supply chain to meet demand for cereal
t-home eating led to a surge in cereal
sales for Post Holdings, Inc., so much
so that the company was bolstering its
supply chain to meet demand. The second half
of calendar year 2020 also had company executives wanting to adjust its portfolio appropriately and thus trying to forecast how long
the COVID-19 trends of increased at-home
eating and decreased foodservice business
will continue.
Net sales in the Post Consumer Brands segment, which includes ready-to-eat cereal, were
$1.48 billion for the nine months ended June
30, which was a 6% increase from the same
time a year ago.
Still, St. Louis-based Post Holdings experienced market share softness in cereal in June
and July, Robert V. Vitale, president and chief
executive officer, said in an Aug. 7 earnings call
to discuss third-quarter results.
"Our challenge this quarter was to flex our
supply chain to meet this demand," he said.
"To do so, we've limited assortment, enabling
higher manufacturing line productivity and
increased output. This was most pronounced
in Post Consumer Brands, which, because of
its value portfolio, manages a relatively larger number of SKUs (stock-keeping units). We

A

are now close to essentially a normal level of
manufacturing and are reestablishing our merchandising programs."
Cereal innovation came when Post Consumer
Brands and Dunkin' Brands Group, Inc., Canton, Mass., partnered on two new Post cereals:
Dunkin' Caramel Macchiato and Mocha Latte.
In Post's foodservice segment, which consists primarily of egg and potato products, net
sales for the nine months ended June 30 were
$1.04 billion, down 14% from the same time a
year ago.
After the pandemic ends, how many people
continue to eat breakfast at home, and not at
restaurants, is in question.
"The most likely outcome is that the (foodservice) business materially reverts to norm
for 2022, but the puts and takes are that there
will be some percentage of the population
that chooses to work from home, and when
you lose that person departing from home in

the morning and going to work, there will be
some transactions that get lost along the way,"
Mr. Vitale said. "Now what will happen? Will it
shift to still a mid-morning breakfast daypart
or will it be lost? We don't know, but we are
planning to adapt to a modestly different mix
of people working from home and working in
office."
Before the pandemic hit, the year began with
a potential acquisition by Post Holdings disappearing. TreeHouse Foods, Inc., Oak Brook, Ill.,
in January terminated its agreement to sell its
RTE cereal business to Post. The TreeHouse decision came after a Federal Trade Commission
complaint challenged the companies' proposed
$110 million transaction.
During 2020, Post Holding subsidiary Michael Foods, based in Minnetonka, Minn., partnered with Eat Just Inc., San Francisco, on the
plant-based Just Egg. Michael Foods became
the exclusive manufacturer, supplier and distributor of Just Egg to foodservice and food
ingredient customers.
Another Post Holdings subsidiary, Crystal Farms Dairy Co., Minneapolis, in March
launched Cheese Wraps that offer a glutenfree and low-carbohydrate alternative to sliced
bread, pitas, tortillas and wraps. CP

Chief executive officer -
Robert V. Vitale

Post Holdings, Inc. net sales

Post Holdings, Inc.
net earnings

(fiscal years ended in September)

Post Holdings share price
$120

(fiscal years ended in September)

$35

$457

$122

in millions

in millions

$106
$92
$5,226

$6,257

$5,681

$78
$64

2017

104 \ October 2020

2018

2019

2017

2018

2019

Oct. Dec.
2019

Milling & Baking News * Food Business News * Baking & Snack * Meat+Poultry * Pet Food Processing

Feb.
2020

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June

Aug.

Corporate Profiles



Corporate Profiles - 2020

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