Freshpet Inc (FRPT)

Pretax margin

Mar 31, 2025 Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020
Earnings before tax but after interest (EBT) (ttm) US$ in thousands 16,304 47,523 44,254 25,209 10,877 -31,515 -48,800 -59,169 -63,025 -55,480 -61,755 -45,805 -33,099 -27,532 -22,559 -17,475 -10,178 -3,123 4,895 4,412
Revenue (ttm) US$ in thousands 1,014,577 975,177 927,889 875,143 823,221 766,894 717,307 668,019 630,695 595,344 545,380 501,637 464,246 425,489 394,142 370,742 342,106 318,790 300,020 281,096
Pretax margin 1.61% 4.87% 4.77% 2.88% 1.32% -4.11% -6.80% -8.86% -9.99% -9.32% -11.32% -9.13% -7.13% -6.47% -5.72% -4.71% -2.98% -0.98% 1.63% 1.57%

March 31, 2025 calculation

Pretax margin = EBT (ttm) ÷ Revenue (ttm)
= $16,304K ÷ $1,014,577K
= 1.61%

The pretax margin of Freshpet Inc. exhibits a notable fluctuation over the analyzed period. Initially, during the fiscal year ending June 30, 2020, the pretax margin was positive at 1.57%, indicating a modest profitability before taxes. This margin experienced a slight increase to 1.63% by September 30, 2020, suggesting some stability in profitability. However, beginning in the quarter ending December 31, 2020, the pretax margin turned negative, falling to -0.98%, and continued to decline sharply throughout subsequent periods, reaching a low of -11.32% as of September 30, 2022. This extended period of negative margins reflects persistent operational challenges, rising costs, or pricing pressures impacting profitability before taxes.

Although the margin showed some improvement in late 2022 and into 2023, remaining negative at -4.11% as of December 31, 2023, it demonstrated a progressively narrowing gap. Notably, in the first quarter of 2024, the pretax margin turned positive at 1.32%, indicating a potential shift towards profitability before taxes. The positive trend continued through subsequent quarters, with margins reaching 2.88% in June 2024, 4.77% in September 2024, and slightly declining to 4.87% in December 2024. As of March 31, 2025, the pretax margin stood at 1.61%, reflecting a recovery from earlier losses and a move towards more sustainable profitability levels.

Overall, the pretax margin trend highlights a period of significant operational difficulties followed by a marked turnaround, suggesting improvements in cost management, revenue growth, or other strategic initiatives contributing to enhanced pre-tax profitability.