Marzetti Company Sales and Profit Rise

Marzetti Company(NASDAQ:MZTI) reported fourth quarter fiscal 2025 results on August 21, 2025, with consolidated net sales up 5% to $475.4 million and gross profit rising 8.7% year-over-year to $106.1 million. The company navigated higher SG&A expenses and a $5.1 million restructuring charge, while management highlighted a strategic rebrand, supply chain transformation, and disciplined marketing investment. The following insights detail the most significant developments and implications from the earnings call.

Rebrand aligns Marzetti Company with flagship brand

This quarter marked the formal transition from Lancaster Colony to Marzetti Company, a move intended to strengthen corporate identity and market positioning. The company maintained retail leadership, with New York Bakery gaining 260 basis points of market share and the combined Sister Schubert's and Texas Roadhouse brands increasing share by 690 basis points.

"Formerly known as Lancaster Colony Corporation, our business rebranded as The Marzetti Company effective June 27. This rebranding honors the 130-year history of our flagship Marzetti brand and signals our future as a food company with an ongoing commitment to delivering high-quality, flavorful products that make every meal better. While Lancaster Colony will always be an important part of our heritage, we believe the Marzetti name is critical to positioning our business in today's food industry and communicating the value we deliver to all of our stakeholders."
-- Dale Ganobsik, Vice President of Corporate Finance and Investor Relations

The rebrand is a strategic step to unify the company’s identity with its most recognized brand, potentially enhancing customer loyalty and competitive differentiation in the packaged foods sector.

Supply chain reset drives margin expansion at Marzetti Company

Marzetti Company initiated a manufacturing network reset in fiscal 2026 (period ending June 30, 2026), including the planned closure of the Milpitas, California, facility and integration of the newly acquired Atlanta plant, supported by $78.8 million in acquisition outlays in fiscal 2025. Excluding non-core supply agreement sales, cost savings in procurement, value engineering, and IT systems contributed to a 130 basis point gross margin expansion.

"As we look forward into '26, what I would add to that list is the network reset that we're doing. So essentially, between closing the Milpitas facility and ramping up College Park, that gives us another pillar to drive cost savings into '26. And I think as we look at it, right now, we're in the midst of that transition. So we're decommissioning lines in California, commissioning lines in Atlanta, and moving volume into Horse Cave as well. There's a lot of change going on right now in our networks, and we're executing well against those. As we get into the back half of fiscal '26, I think we'll begin to see more of those benefits flow through to our margin as the year progresses."
-- Tom Pigott, CFO

Successful execution of these network changes is expected to support sustained margin improvement and operational efficiency, reinforcing the company’s long-term profitability outlook.

Marketing investment accelerates household penetration and share

Nearly half of the $8.9 million year-over-year increase in SG&A was driven by incremental marketing spend, which led to an eight-point improvement in household penetration for key products and share gains in five of seven major retail categories. Circana scanner data showed branded product sales and volumes both up 5.5% year-over-year.

"We invested in some very specific programs that helped us drive household penetration. If you look across our shares, we were up share-wise in five of our seven categories. And I'll give you sort of anecdotally why we feel good about it. You look at our own Texas toast brand, right now, we ended the quarter with about a 43 share. With that product, our household penetration was up eight points in the quarter. And our repeat rate on that item is almost 60%. And our belief continues to be if we can make smart marketing investments at reasonable prices and we can drive household penetration, the performance of that product keeps those consumers in the fold and allows that business to continue to grow period on period. And we took that same sort of formula, and we use it across a range of different products in a very point-specific basis. And we think it's, along with innovation, going to be an important part of our overall algorithm that allows us to deliver profitable volumetric growth."
-- Dave Ciesinski, President and CEO

This targeted marketing approach demonstrates management’s ability to allocate capital for measurable volume growth and strengthens the company’s competitive position in core categories.

Looking Ahead

Management projects low single-digit revenue growth for fiscal 2026 (period ending June 30, 2026), driven by volume gains in the retail segment, while foodservice revenue is expected to remain flat. Gross margin expansion is targeted at approximately 50 basis points year-over-year. SG&A is expected to grow with inflation off an adjusted base, and capital expenditures are forecast at $75 million to $85 million.

Where to invest $1,000 right now

When our analyst team has a stock tip, it can pay to listen. After all, Stock Advisor’s total average return is 1,052%* — a market-crushing outperformance compared to 183% for the S&P 500.

They just revealed what they believe are the 10 best stocks for investors to buy right now, available when you join Stock Advisor.

See the stocks »

*Stock Advisor returns as of August 18, 2025

This article was created using Large Language Models (LLMs) based on The Motley Fool's insights and investing approach. It has been reviewed by our AI quality control systems. Since LLMs cannot (currently) own stocks, it has no positions in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.