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SEC filingStrong quarter with double-digit profit growth driven by volume gains and productivity improvements, though cash flow remained negative due to seasonal working capital build.
Consolidated net sales for the second quarter of fiscal 2026 were $906.2 million, an increase of 8.7% compared to $833.5 million in the prior year quarter. The growth was primarily driven by the Pet segment, where sales increased due to higher volumes in the Dog & Cat business, particularly in treats and toys, as well as increased sales in the outdoor cushion business resulting from the timing of shipments that shifted from the first quarter into the second quarter.
Net cash used in operating activities was $119.9 million, compared to $115.7 million in the prior year quarter, reflecting seasonal working capital needs. Capital expenditures increased to $21.3 million from $16.8 million, resulting in free cash flow of negative $141.1 million. The company believes that cash flows from operating activities, funds available under its credit facility, and arrangements with suppliers will be adequate to fund working capital and capital expenditure requirements for the foreseeable future.
As part of its growth strategy, the company has acquired a number of companies in the past and anticipates continuing to evaluate potential acquisition candidates. Additionally, the Board has authorized supplemental stock purchases to minimize dilution from equity compensation plans.