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What changed in CENTRAL GARDEN & PET CO's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of CENTRAL GARDEN & PET CO's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+334 added−399 removedSource: 10-K (2025-11-26) vs 10-K (2024-11-27)

Top changes in CENTRAL GARDEN & PET CO's 2025 10-K

334 paragraphs added · 399 removed · 269 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

116 edited+38 added−61 removed1 unchanged
Biggest changeWe also operate a sales and logistics facility in the United Kingdom. 5 Pet Sales and Marketing Our sales strategy is multi-tiered and designed to maximize market share with retailers. Our customers include retailers, such as club, regional and national specialty pet stores, independent pet retailers, food, drug and mass stores, as well as the eCommerce channel.
Biggest changePet Sales and Marketing Our sales strategy is designed to maximize market share across retail channels, including club, regional and national specialty pet stores, independent, food, drug and mass, grocery, farm & feed and eCommerce. We also serve the professional market with insect control and health and wellness products for use by veterinarians, municipalities, farmers and equine product suppliers.
We estimate the annual retail sales of the lawn and garden consumables market in the categories in which we participate to be approximately $30 billion. The lawn and garden consumables market is highly concentrated with most products sold to consumers through a number of distribution channels, including home centers, mass merchants, independent nurseries and hardware stores.
We estimate the annual retail sales of the lawn and garden consumables market in the categories in which we participate to be approximately $32 billion. The lawn and garden consumables market is highly concentrated with most products sold to consumers through a number of distribution channels, including home centers, mass merchants, independent nurseries and hardware stores.
The total lawn and garden consumables industry in the United States is estimated by Packaged Facts, the Freedonia Group, Numerator and internal estimates to be approximately $31 billion in annual retail sales in 2024, including grass and other seeds, fertilizer, controls, live goods, wild bird products as well as soil and mulch.
The total lawn and garden consumables industry in the United States is estimated by Packaged Facts, the Freedonia Group, Numerator and internal estimates to be approximately $33 billion in annual retail sales in 2025, including grass and other seeds, fertilizer, controls, live goods, wild bird products as well as soil and mulch.
We believe these strengths have assisted us in becoming one of the largest pet supplies vendors to Costco, Amazon and Walmart, and a leading supplier to independent pet retailers in the United States and among the largest lawn and garden consumables vendors to Home Depot, Walmart and Lowe’s.
We believe these strengths have positioned us as one of the largest pet supplies vendors to Costco, Amazon and Walmart, a leading supplier to independent pet retailers in the United States and among the largest lawn and garden consumables vendors to The Home Depot, Walmart and Lowe’s.
Competitive Strengths We believe we have a number of competitive strengths, which serve as the foundation of our Central to Home strategy, including the following: Broad Portfolio of Leading Brands Across Key Pet and Garden Segments We are one of the leaders in the U.S. pet supplies market and the lawn and garden consumables market.
Competitive Strengths We believe we have a number of competitive strengths that serve as the foundation of our Central to Home strategy, including the following: 2 Broad Portfolio of Leading Brands Across Key Pet and Garden Segments We are a leader in both the U.S. pet supplies market and the lawn and garden consumables market.
We are an industry leader in premium edible and non-edible chews, supplements, interactive toys, grooming supplies, beds and containment, training and waste management solutions featuring the brands Best Bully Sticks, Cadet, Four Paws, Healthy Edibles ® , K&H, Healthy Promise TM , Nylabone, Nubz ® , and Paw Love ® among others. Small Animal and Bird Supplies.
We are an industry leader in premium edible and non-edible chews, supplements, toys, grooming supplies, beds, containment, training and waste management with brands including Best Bully Sticks, Cadet, Four Paws, Healthy Edibles ® , K&H, Healthy Promise TM , Nylabone, Nubz ® , and Paw Love ® . Small Animal and Bird Supplies.
He served as Chief Financial officer from May 2017 until September 2024, Senior Vice President of Finance and Chief Financial Officer of our Pet segment from April 2014 to May 2017, and Vice President of Corporate Financial Planning & Analysis from October 2011 to March 2014. Mr.
Lahanas became our Chief Executive Officer in September 2024. He previously served as Chief Financial officer from May 2017 until September 2024, Senior Vice President of Finance and Chief Financial Officer of our Pet segment from April 2014 to May 2017, and Vice President of Corporate Financial Planning & Analysis from October 2011 to March 2014.
Our Garden segment includes lawn and garden consumables such as grass seed; vegetable, flower and herb packet seed; wild bird feed, bird houses and other birding accessories; weed, grass, and other herbicides, insecticide and pesticide products; fertilizers and live plants. These products are sold under brands such as Amdro ® , Ferry-Morse ® , Pennington ® and Sevin ® .
Our Garden segment includes lawn and garden consumables such as grass seed; vegetable, flower and herb packet seed; wild bird feed, bird houses and other birding accessories; weed, grass, and other herbicides, insecticide and pesticide products; fertilizers and live plants. Brands in this segment include 3D ® , Amdro ® , Ferry-Morse ® , Pennington ® and Sevin ® .
In fiscal 2024, Farnam partnered with country music trio The Castellows to debut the brands' new logo to be used across all point of sale and marketing, including a new Amazon storefront.
In fiscal 2024, Farnam partnered with country music trio The Castellows to launch the brands' new logo across all marketing and point of sale channels, including a refreshed Amazon storefront.
Information About Our Executive Officers The following table sets forth the name, age and position of our executive officers as of November 25, 2024. Name 1 Age Position William E. Brown 83 Chairman of the Board Niko Lahanas 56 Chief Executive Officer John E. Hanson 59 President, Pet Consumer Products Brad Smith 58 Chief Financial Officer J.D.
Information About Our Executive Officers The following table sets forth the name, age and position of our executive officers as of November 24, 2025. Name 1 Age Position William E. Brown 84 Chairman of the Board Niko Lahanas 57 Chief Executive Officer John E. Hanson 60 President, Pet Consumer Products Brad Smith 59 Chief Financial Officer J.D.
Lahanas was the Director of Business Performance from March 2008 to October 2011, where his primary focus was on business unit profitability, and was a Finance Manager from October 2006 to March 2008 in our Garden segment. Prior to joining Central, he worked in private equity and investment banking for over eight years. John E. Hanson. Mr.
From March 2008 to October 2011, he was Director of Business Performance, focusing on business unit profitability, and from October 2006 to March 2008 he was Finance Manager in our Garden segment. Prior to joining Central, Mr. Lahanas worked in private equity and investment banking for more than eight years. John E. Hanson . Mr.
Branded Pet Products Our principal pet supplies categories are dog and cat supplies, treats and chews; aquatics and reptile supplies, small animal and pet bird supplies, animal health products as well as live fish and small animals.
Branded Pet Products Our core categories include dog and cat supplies, treats and chews; aquatics and reptile supplies, small animal and pet bird supplies, animal health and equine care; as well as live fish and small animals.
Walker became our President of Garden Consumer Products in 2017 and has responsibility for Central's branded garden business including sales, marketing operations, the controls and fertilizer, grass seed and vendor partner business units, as well as the retail sales & service team.
Walker has served as our President of Garden Consumer Products since 2017, overseeing Central's branded garden business, including sales, marketing operations, the controls and fertilizer, grass seed and vendor partner business units, and the retail sales & service team.
The pet supplies segment includes: dog and cat treats and chews, toys, beds and containment, grooming products, waste management and training pads; supplies for aquatics, small animals, reptiles and pet birds including toys, enclosures and habitats, bedding, food and supplements; products for equine and livestock, animal and household health and insect control products; live fish and small animals.
The pet supplies segment includes dog and cat treats, chews, toys, beds, containment, grooming products, waste management solutions; aquatics, reptile, small animal, and pet bird supplies, including toys, enclosures, habitats, bedding, food and supplements; as well as equine and livestock products, animal and household health and insect control products; and live fish and small animals.
We are a leading manufacturer of aquariums and terrariums as well as related fixtures and stands, water conditioners and supplements, water pumps and filters, sophisticated lighting systems and accessories under the brands Aqueon, Blagdon ® , Coralife ® , Interpet ® and Zilla. Live Fish and Small Animals .
We are a leading manufacturer of aquariums and terrariums along with related fixtures and stands, water conditioners and supplements, water pumps and filters, advanced lighting systems and accessories marketed under the Aqueon, Coralife ® , and Zilla brands. Live Fish and Small Animals.
With Bell Nursery, we are the primary supplier of superior quality flowers, trees, shrubs and other plants to Home Depot in the Northeast and mid-Atlantic regions, producing and shipping tens of millions of annuals, perennials and indoor plants each year, also offering items we do not grow, such as orchids. Packet Seed.
Through Bell Nursery, we serve as the primary supplier of high-quality flowers, trees, shrubs and other plants to The Home Depot stores in the Northeast and Mid-Atlantic regions, producing and shipping tens of millions of annuals, perennials and indoor plants each year, along with select offerings we do not grow, such as orchids. Packet Seed.
We collaborate closely with our customers to identify their needs, jointly develop strategies to meet those needs and deliver programs that include digital execution, print, broadcast and direct mail. We continue to invest in talent, innovation, brand building, digital capabilities and eCommerce as these play a critical role in our ambition to lead in the pet segment.
We work closely with our customers to identify their needs, co-develop strategies, and deliver programs that span digital execution, print, broadcast and direct mail. We continue to invest in talent, innovation, brand building, digital capabilities and eCommerce as these are critical to our ambition to lead in the pet segment.
Under this Act, the EPA is evaluating the cumulative risks from dietary and non-dietary exposures to pesticides. Any pesticides in our products that are approved to be used on foods are evaluated by the EPA as part of this non-dietary exposure risk assessment.
Under this Act, the EPA evaluates the cumulative risks from both dietary and non-dietary exposures to pesticides. Any pesticides in our products that are approved for use on foods are reviewed by the EPA as part of this non-dietary exposure risk assessment.
Hanson became our President of Pet Consumer Products in August 2019 after serving as a board member during portions of 2018 and 2019. From 2015 to 2017, he served as Chief Executive Officer of Oasis Brands, Inc. Beginning in 2013, Mr. Hanson consulted for consumer products companies in the areas of strategy, operations, mergers, and acquisitions.
Hanson has served as President of Pet Consumer Products since August 2019, after serving as a board member during portions of 2018 and 2019. From 2015 to 2017, he was Chief Executive Officer of Oasis Brands, Inc. Beginning in 2013, he provided 9 consulting services for consumer products companies in strategy, operations, and mergers and acquisitions.
Walker 66 President, Garden Consumer Products Joyce McCarthy 55 General Counsel & Secretary William E. Brown . Mr. Brown has been our Chairman since October 2019, having also served in this capacity from 1980 to 2018. From 1980 to June 2003 and from October 2007 to February 2013, he served as our Chief Executive Officer. From 1977 to 1980, Mr.
Walker 67 President, Garden Consumer Products George Yuhas 73 General Counsel & Secretary William E. Brown . Mr. Brown has been our Chairman since October 2019, having previously served in this capacity from 1980 to 2018. He was our Chief Executive Officer from 1980 to June 2003 and from October 2007 to February 2013.
He served as Executive Vice President and General Manager - Garden Branded Business from 2014 to 2017 and began with Central as Senior Vice President - Garden Sales in 2011. Prior to joining Central, Mr. Walker held increasingly senior positions for 13 years with Spectrum Brands and for 17 years with The Gillette Company's Duracell North American Group.
From 2014 to 2017, he was Executive Vice President and General Manager - Garden Branded Business, and he joined Central in 2011 as Senior Vice President - Garden Sales. Before joining Central, he spent 13 years with Spectrum Brands in senior positions and 17 years with The Gillette Company's Duracell North American Group. George Yuhas . Mr.
In addition, the use of certain pesticide and fertilizer products is regulated by various local, state, federal and foreign environmental and public health agencies.
Additionally, the use of certain pesticide and fertilizer products is regulated by various environmental and public health agencies at the local, state, federal and international level.
Segrest and SunPet are leading wholesalers of aquarium fish and plants, reptiles and small animals to pet specialty and mass merchandiser stores as well as public aquariums and research institutions. Outdoor cushions.
Segrest and SunPet are leading wholesalers of aquarium fish and plants, reptiles and small animals serving pet specialty, mass merchants, aquariums and research institutions. Outdoor cushions.
Pet ownership is now split equally between younger generations (Gen Z and Millennials) and older generations (Gen X and Baby Boomers), with the younger generations spending more on their pet in the past year.
Pet ownership is evenly split between younger generations (Gen Z and Millennials) and older generations (Gen X and Baby Boomers), with younger owners spending more on their pet.
Sales to Home Depot represented approximately 38% and 35%, sales to Walmart represented approximately 27% and 24% and sales to Lowe’s represented approximately 15% and 14% of our Garden segment’s net sales in fiscal 2024 and 2023, respectively.
In fiscal 2025 and 2024, sales to The Home Depot accounted for approximately 37% and 38%, Walmart represented approximately 29% and 27%, and Lowe’s represented approximately 14% and 15% of our Garden segment’s net sales, respectively.
Our products are sold primarily under the Starbar ® and Zoëcon ® family of brands, as well as standalone brands such as Altosid ® , Centynal™, ClariFly ® IGR, Diacon ® , Essentria ® and Extinguish ® . We also sell (S)-Methoprene to manufacturers of other insect control products, including Frontline Plus. Aquatics and Reptile Supplies.
Our insect control products are marketed under the Starbar ® and Zoëcon ® families of brands, along with standalone brands such as Altosid ® , Centynal™, ClariFly ® IGR, Diacon ® , Essentria ® and Extinguish ® . In addition, we supply (S)-Methoprene to manufacturers of other insect control products, including Frontline Plus. Aquatics and Reptile.
We produce both branded and private label products for our customers as well as distribute third-party brands that give our retail partners a breadth of selection from premium to value products. Recent trends have shown that eCommerce channels, including pure-play, omnichannel and direct-to-consumer, are the preferred solutions for today's convenience-oriented consumers.
We produce both branded and private label products for our customers as well as distribute third-party brands that give our retail partners a breadth of selection from ultra-premium to value offerings. Today's convenience-oriented consumers increasingly rely on eCommerce channels, including pure-play, omnichannel and direct-to-consumer, as part of their shopping routine.
We have a diversified portfolio of brands in both segments, many of which are among the leading brands in their respective market categories, ranging from Aqueon in aquatics, Cadet in dog treats and chews, Farnam in equine, Four Paws in waste management and grooming, K&H in heated pet products, Kaytee in pet bird and small animal, and Nylabone in dog toys and treats to Amdro in controls, Ferry-Morse in packet seed and Pennington in wild bird products, grass seed and fertilizer.
Our diversified portfolio spans many of the most recognized brands in their categories, including Aqueon in aquatics, Cadet in dog treats and chews, Farnam in equine, Four Paws in waste management and grooming, K&H in heated pet products, Kaytee in pet bird and small animal, and Nylabone in dog toys and treats as well as Amdro in controls, Ferry-Morse in packet seed and Pennington in wild bird products, grass seed and fertilizer.
Available Information Our web site is www.central.com. We make available free of charge, on or through our website, our annual, quarterly and current reports, and any amendments to those reports, as soon as reasonably practicable after electronically filing or furnishing such reports with the Securities and Exchange Commission.
We make available, free of charge on or through our website, our annual, quarterly and current reports, along with any amendments to those reports, as soon as reasonably practicable after they are electronically filed with or furnished to the Securities and Exchange Commission.
Consumer: Build and Grow Brands that Consumers Love To grow, we are seeking to develop more differentiated new produ cts and reinvest some of our annual cost savings in brand building and demand creation to help us drive sustainable organic growth and build market share.
Consumer: Build and Grow Brands that Consumers Love We are focusing on developing differentiated new produ cts and reinvesting some of our annual cost savings into brand building and demand creation to deliver sustainable organic growth and expand market share.
Grass and other seeds are also subject to state and federal labeling regulations. Prior to any international sales, all foreign agency requirements for shipment and labeling must be met. The Food Quality Protection Act (“FQPA”) establishes a standard for food-use pesticides, which is a reasonable certainty that no harm will result from the cumulative effect of pesticide exposures.
Before any international sales, all foreign agency requirements for shipment and labeling must also be met. 8 The Food Quality Protection Act (“FQPA”) establishes a safety standard for food-use pesticides: a reasonable certainty that no harm will result from the cumulative effects of pesticide exposure.
To address the changing consumer landscape, we continue to build out our digital and eCommerce capabilities while also ensuring we have the right policies, products and programs to allow all channels to compete effectively. Concurrently, we are optimizing our supply chain for high-demand eCommerce items to ensure customer and consumer availability requirements are met at optimal cost.
To meet this demand, we continue to expand our digital and eCommerce capabilities while ensuring the right policies, products and programs enable all channels to compete effectively. At the same time, we are optimizing our supply chain for high-demand eCommerce items, ensuring customer and consumer availability requirements are fulfilled at optimal cost.
In addition, our Pet segment operates one of the largest sales and distribution networks in the industry, strategically supporting our brands. Pet Industry Background The pet industry includes food, supplies, veterinary care and non-medical services, and live animals. We operate primarily in the pet supplies segment of the industry as well as in the live fish and small animal categories.
Our Pet segment is supported by one of the largest sales and distribution networks in the industry, which provides strategic reach and scale for our brands. Pet Industry Background The pet industry encompasses food, supplies, veterinary care, non-medical services, and live animals. We participate primarily in pet supplies as well as in live fish and small animal categories.
He joined Central in 2017 as Chief Financial Officer of our Pet Segment. Before joining Central, Mr. Smith worked at the Delhaize Group (now Ahold Delhaize), where he served 12 years in finance roles of increasing responsibility, including Chief Financial Officer of their European operations. Prior to Delhaize Group, he spent 11 years at Arthur Andersen. J.D. Walker. Mr.
Before joining Central, he spent 12 years with Delhaize Group (now Ahold Delhaize) in progressively more senior finance roles, including Chief Financial Officer of its European operations. Prior to Delhaize Group, Mr. Smith spent 11 years at Arthur Andersen. J.D. Walker. Mr.
At the 2024 Global Pet Expo, D&D Commodities took third place in best in show for its Wild Delight Squirrel Away Zero-Waste bird feed and our Reptifauna bioactive plants won second place in the Reptile best in show category. Barkworthies' new floor display won first place in the point of purchase category at SuperZoo.
At the 2024 Global Pet Expo, D&D Commodities earned third place in the “Best in Show” category for its Wild Delight Squirrel Away Zero-Waste bird feed while our Reptifauna bioactive plants won second place in the Reptile category.
Item 1. Business Our Company Central Garden & Pet Company (“Central”) is a market leader in the pet and garden industries in the United States. For over 40 years, Central has marketed innovative and trusted solutions helping lawns grow greener, gardens bloom bigger, pets live healthier, and communities grow stronger.
Item 1. Business Our Company Central Garden & Pet Company (“Central”) is a market leader in the U.S. pet and garden industries. For more than 40 years, we have delivered innovative, trusted solutions that help lawns grow greener, gardens bloom bigger, pets live healthier, and communities grow stronger. We operate through two reportable segments: Pet and Garden.
Our Pet segment includes dog and cat supplies such as treats and chews, toys, beds and containment, grooming products, waste management and training pads; supplies for aquatics, small animals, reptiles and pet birds including toys, enclosures and habitats, bedding, food and supplements; products for equine and livestock, animal and household health and insect control products; live fish and small animals as well as outdoor cushions.
We also provide supplies for aquatics, small animals, reptiles and pet birds, such as toys, enclosures, habitats, bedding, food and supplements, equine and livestock products, animal and household health solutions and insect control items. This segment also includes live fish and small animals as well as outdoor cushions.
These products are sold under brands such as Aqueon ® , Cadet ® , C&S ®, Comfort Zone ® , Farnam ® , Four Paws ® , Kaytee ® , Nylabone ® and Zilla ® .
Products are sold under well-recognized brands including Aqueon ® , Best Bully Sticks ® , Cadet ® , C&S ®, Comfort Zone ® , Farnam ® , Four Paws ® , Kaytee ® , Nylabone ® , Zilla ® and Zoëcon ® .
We have seen promising marketing campaign results driving accelerated growth and share gains across several brands, including our Farnam “Everything for the Ride” and Zilla “Rep Yourself” campaigns. 1 Customer: Win with Winning Customers and Channels We are building on our strong customer relationships by developing and executing winning category growth strategies.
Recent marketing initiatives, including our Farnam “Everything for the Ride”, Nylabone’s 70 th birthday campaign and DoMyOwn’s “Chief Solutions Officer” initiative with Richard Karn have delivered promising results, accelerating growth and driving share gains across multiple brands. 1 Customer: Win with Winning Customers and Channels We are building on our strong customer relationships by developing and executing winning category growth strategies.
Finally, we are also investing in sales planning, net revenue management and price pack architecture. Central: Fortify the Central Portfolio We are managing each business differentially, based on clearly articulated strategies that define the role of each business within our portfolio. We regularly assess the profitability and growth potential of each of our businesses.
We are also investing in sales planning, net revenue management and price pack architecture to strengthen our position across the marketplace. Central: Fortify the Central Portfolio We manage each business based on clearly articulated strategies that establish its role within our portfolio.
We sell Arden-branded outdoor cushions through major retailers, both in-store and online, and private label outdoor cushions through the largest big box stores in North America, all leveraging Arden's EverTru ® -branded outdoor fabric. Our OceanTex™ fabrics, developed by EverTru, are responsibly made and composed of up to 100% recycled materials, including reclaimed ocean plastic and fishing nets.
Arden-branded and private label outdoor cushions are sold across major retailers both in-store and online, using Arden's EverTru ® -branded outdoor fabric and OceanTex™ fabrics, the latter made from up to 100% recycled materials, including reclaimed ocean plastic and fishing nets.
Such regulations are often complex and are subject to change. For example, in the United States, all pesticides must be registered with the United States Environmental Protection Agency (“EPA”), in addition to individual state registrations before they can be sold. Fertilizer products are also subject to state Department of Agriculture registration regulations.
Regulatory Considerations Many of the products we manufacture or distribute are subject to local, state, federal and foreign laws and regulations. These regulations are often complex and subject to change. For example, in the United States, all pesticides must be registered with the United States Environmental Protection Agency (“EPA”), as well as individual states before they can be sold.
The Pet segment competes primarily on the basis of brand recognition, innovation, upscale packaging, quality and service. Our Pet segment’s sales and distribution network competes with Animal Supply Co., Phillips Pet Food & Supplies and a number of smaller local and regional distributors, with competition based on product selection, price, value-added services and personal relationships.
Competition is driven by brand recognition, innovation, packaging, quality and service. Our distribution network also competes with Animal Supply Co., Phillips Pet Food & Supplies and smaller local and regional distributors, with differentiation based on selection, price, service and relationships.
We continuously strive to get a deeper understanding of our consumers, the products and features they desire and how they make their purchasing decisions. We are investing in consumer insights, data analytics as well as research and development to achieve our innovation goals with a strong pipeline of new products.
To deepen our understanding of consumers, the products and features they value, and how they make their purchasing decisions, we are investing in consumer insights, data analytics, and research and development. These efforts are fueling our product innovation pipeline.
Prior to that, he had over 16 years of experience at ConAgra, where he served in a variety of senior-level roles including President of its Frozen Foods Division from 2008 to 2012 and Senior Vice President in Sales from 2006 to 2008. Bradley "Brad" Smith . Mr. Smith became our Chief Financial Officer in September 2024.
From 1996 to 2012, he held senior positions at ConAgra, including President of its Frozen Foods Division from 2008 to 2012 and Senior Vice President in Sales from 2006 to 2008. Bradley "Brad" Smith . Mr. Smith became our Chief Financial Officer in September 2024. He joined Central in 2017 as Chief Financial Officer of our Pet Segment.
Our Pennington brand is one of the largest in grass seed, wild bird feed and birding accessories. Ferry-Morse is a leader in vegetable, herb and flower packet seed, and our Amdro brand is a leading portfolio of control products. We continuously introduce new products, both as complementary extensions of existing product lines and in new product categories.
The Pennington brand is one of the largest names in grass seed, wild bird feed and birding accessories. Ferry-Morse is a leader in vegetable, herb and flower packet seed, while Amdro represents a strong portfolio of pest and weed control products.
For example, we acquired TDBBS, LLC ("TDBBS") in 2023, a business in the attractive pet treat segment with strong eCommerce capabilities. We are also committed to divesting businesses where we cannot find a path to sustainable profitability. For instance, in 2023 we sold our low-margin distribution business into the independent garden channel.
Recent examples include our fiscal 2023 acquisition of TDBBS, LLC ("TDBBS"), a leader in the attractive pet treat segment with robust eCommerce capabilities. We are equally committed to exiting businesses where sustainable profitability cannot be achieved. For example, in fiscal 2023 we divested our low-margin distribution business servicing the independent garden channel.
Our sales and distribution facilities are strategically placed across the United States to allow us to service both our mass market customers, as well as independent pet specialty retail stores, serving traditional brick-and-mortar but increasingly also 3 omnichannel and pure-play retailers selling only through the internet. In addition, we operate facilities in China, Canada, the United Kingdom and Mexico.
In addition, we operate manufacturing facilities in Canada and Mexico. Our pet and garden sales and fulfillment facilities are strategically located across the United States, enabling us to serve both mass-market customers and independent pet specialty retail stores. This network supports traditional brick-and-mortar outlets as well as increasingly omnichannel and online-only retailers.
Walmart, our second largest customer, represented approximately 16% of our total net sales in fiscal 2024 and 16% in fiscal 2023. Costco, Lowe's and Amazon are also significant customers, and together with Home Depot and Walmart, they accounted for approximately 54% of our net sales in fiscal 2024 and 52% in fiscal 2023.
Walmart, our largest customer, accounted for approximately 17% of total net sales in fiscal 2025 and 16% in fiscal 2024. Home Depot, our second largest customer, represented approximately 16% of total net sales in fiscal 2025 and 17% in fiscal 2024.
Sources and Availability of Raw Materials We purchase most of our raw materials from multiple suppliers but obtain one of the raw materials used to manufacture (S)-Methoprene from a single source of supply.
Sources and Availability of Raw Materials We source most of our raw materials from multiple suppliers; however, one key input used to manufacture (S)-Methoprene is obtained from a single supplier. To mitigate supply risk, we maintain inventories of both (S)-Methoprene and this raw material.
Long-Term Pet Industry Characteristics Long term, we believe the U.S. pet supplies market will continue to grow due to favorable trends tracking within the pet industry, including the demographics shift to younger shoppers, humanization and premiumization, and health and wellness.
Long-Term Pet Industry Characteristics We expect the U.S. pet supplies market to continue to grow, supported by long-term trends, including demographics shifts, humanization and premiumization of pets, and heightened focus on health and wellness.
According to Packaged Facts, the U.S. pet supplies market is highly fragmented with over 2,500 manufacturers, ranging from mostly single-category or limited-range players to approximately two dozen companies with a solid multi-category presence.
According to Packaged Facts, the U.S. pet supplies market is highly fragmented, with more than 2,500 manufacturers, most operating in single or limited categories. Only about two dozen companies maintain a solid multi-category presence, and brands are even more fragmented within the supplies categories than food and treats.
Environmental, Social and Governance The long-term profitability of our business requires us to do our part to protect the planet, care for the local areas we serve, and provide our employees a safe, healthy and rewarding workplace. Corporate sustainability is embedded throughout our long-term enterprise roadmap and brought to life through our Central Impact strategy.
Corporate Sustainability The long-term success of our business depends on protecting the planet, supporting the communities we serve, and providing our employees with a safe, healthy and rewarding workplace. Corporate sustainability is embedded in our long-term enterprise roadmap and brought to life through our Central Impact strategy.
Home and garden centers and mass merchants typically carry multiple premium and value brands. Long-Term Garden Industry Characteristics Transitioning from COVID highs to a new normal level, the lawn and garden industry has experienced volatility driven by supply chain challenges, unpredictable weather patterns, and retailer destocking initiatives.
Home and garden centers and mass merchants typically carry multiple premium and value brands. Long-Term Garden Industry Characteristics Following the surge in demand during the COVID-19 pandemic, the lawn and garden industry is adjusting to a new baseline marked by ongoing volatility. Supply chain challenges, shifting weather patterns, and retailer destocking have added uncertainty.
Brown was Senior Vice President of Vivitar Corporation with responsibility for Finance, Operations and Research & Development. From 1972 to 1977, he was with McKesson Corporation where he was responsible for its 200-site data processing organization. Prior to joining McKesson Corporation, Mr.
From 1977 to 1980, he was Senior Vice President of Vivitar Corporation, responsible for Finance, Operations and Research & Development. From 1972 to 1977, he worked at McKesson Corporation, overseeing its 200-site data processing organization. Mr. Brown spent the first 10 years of his career at McCormick, Inc. in manufacturing, engineering and data processing. Nicholas "Niko" Lahanas . Mr.
We produce several lines of lawn and garden fertilizers and soil supplements in granular and liquid form under the Alaska ® Fish Fertilizer, Ironite ® , Pennington, Pro Care ® and Superthrive ® brand names and other private and controlled labels. We also manufacture lawn and garden weed, moss, insect and pest control products.
We produce a wide range of fertilizers, soil supplements and pest control products, in both granular and liquid form. Brands include Alaska ® Fish Fertilizer, Ironite ® , Pennington, Pro Care ® and Superthrive ® as well as private and controlled labels.
We are a leading provider of vegetable, herb and flower packet seeds and seed starters. We sell these products under the American Seed ® , Ferry-Morse, Jiffy ® , Livingston ® , McKenzie ® Seed and other brand names.
We are a leading provider of packet seeds and seed starters across vegetables, herbs and flowers, sold under American Seed ® , Ferry-Morse, Jiffy ® , Livingston ® , McKenzie ® Seed and other well-known brands.
The majority of our brands have been marketed and sold for more than 40 years. Robust Financial Performance We have demonstrated strength in our financial performance, in net sales, earnings and cash flow. Our net sales grew on average 6.1% annually over the last five years, driven by acquisitions and organic growth.
The majority of our brands have been marketed for over 40 years, establishing deep consumer trust and strong market positions. Robust Financial Performance We have demonstrated strength in net sales, earnings and cash flow.
Interest in outdoor living is particularly high among millennials, the nation's largest group of gardeners. Branded Lawn and Garden Products Our principal lawn and garden consumables product lines are grass seed, wild bird products, lawn and garden care products including fertilizers, insect control products, live plants and packet seed to help consumers grow their lawns greener and gardens bloom bigger.
Branded Lawn and Garden Products Our core lawn and garden consumables portfolio includes grass seed, wild bird products, lawn and garden care products (such as fertilizers, insect control products), live plants and packet seed designed to help consumers grow their lawns greener and gardens bloom bigger.
We sell these products under brands such as Amdro, Corry’s ® , Daconil ® , IMAGE ® , Knockout™, Lilly Miller ® , Moss Out ® , Over-N-Out ® , Rootboost™ and Sevin, as well as other private and controlled labels. Live Plants.
Our weed, moss, insect and pest control products are marketed under brand names such as Amdro, Corry’s ® , Daconil ® , IMAGE ® , Knockout™, Lilly Miller ® , Moss Out ® , Over-N-Out ® , Rootboost™ and Sevin. 6 Live Plants.
We are a leading manufacturer of supplies and food for small animals, pet birds and wild birds. We offer a full range of products including species specific diets, treats, habitats, bedding, hay and toys under the Kaytee brand. Our Kaytee small animal and pet bird food mixes are fortified with a proprietary blend of vitamins and minerals.
We are a leading manufacturer of supplies and food for small animals, pet birds and wild birds. Under Kaytee, we provide fortified diets, habitats, bedding, hay treats and toys, along with suet products for backyard birding under C&S. Animal Health (Health & Wellness, Equine and Professional).
A 2024 Packaged Facts survey found that across generations, the majority of pet owners depend on their pets intensely for companionship, affection, fun and mental and physical health benefits. The same survey found that approximately 95% of U.S. pet owners view their pet as family.
A 2024 Packaged Facts survey found that about 95% of U.S. pet owners view their pet as family, and across all ages, pets are seen as essential companions for affection, fun and mental and physical health, with new research continuing to validate this human-pet bond.
Among our leading brands are: Nylabone in dog toys and treats, Kaytee in pet birds and small animal, Farnam in equine, C&S in suet, Aqueon in aquatics and Comfort Zone in cat calming.
Leading brands include Nylabone (dog toys and treats), Kaytee (pet birds and small animal), Farnam (equine), C&S (suet), Aqueon (aquatics), Comfort Zone (cat calming) and Zoëcon ® (professional pest control). We also manage Arden Companies ® outdoor cushions within our Pet segment due to synergies with our pet bed business.
We also serve the professional market with insect control and health and wellness products for use by veterinarians, municipalities, farmers and equine product suppliers. Costco accounted for approximately 14% of our Pet segment's net sales in fiscal 2024, and 13% in fiscal 2023. Amazon, Walmart, Petco and Kroger are also significant customers.
Costco accounted for approximately 15% of our Pet segment's net sales in fiscal 2025, and 14% in fiscal 2024. Amazon, Walmart, Petco and Kroger are also significant customers.
Various federal, state and local laws, including the federal Food Safety Modernization Act (“FSMA”), also regulate pet food products and give regulatory authorities the power to recall or require re-labeling of products.
Pet food products are regulated under federal, state and local laws, including the federal Food Safety Modernization Act (“FSMA”), which grants regulatory authorities the power to recall or require relabeling of products. Several new FSMA regulations have taken effect in recent years.
Culture: Strengthen Our Entrepreneurial Business Unit-Led Growth Culture Our values, established by leaders across the organization, are the cornerstone of our culture, and they are at the root of every decision we make – we call them “The Central Way.” We believe having a strong set of values provides a foundation for employees and strengthens how we all work together.
Culture: Strengthen Our Entrepreneurial Business Unit-Led Growth Culture Our values, established by leaders across the organization, are the foundation of our culture, and at the heart of every decision we make. Known as “The Central Way,” these principles guide how we work, collaborate and lead, shaping both our daily actions and our long-term strategy.
Several new FSMA regulations have become effective in recent years. 9 Various local, state, federal and foreign environmental laws also impose obligations on various entities to clean up contaminated properties or to pay for the cost of such remediation, often upon parties that did not actually cause the contamination.
Environmental laws at the local, state, federal and foreign levels also impose obligations to remediate contaminated properties or pay for associated clean-up costs, often extending liability to parties that did not cause the contamination.
The total annual retail sales of the pet food, treats and chews, supplies, veterinary and non-medical services and live animal industry in 2024 was estimated by Packaged Facts to be approximately $151 billion. We expect the industry to continue to grow from that foundation.
Packaged Facts estimated that in 2025, U.S. retail sales of pet food, treats and chews, supplies, veterinary and non-medical services and live animals will total approximately $158 billion, with about $40 billion attributable to the categories where we compete.
In addition, we provide a discretionary annual 401k employer contribution and a bonus program for eligible employees, which is based on the success of our businesses as measured by designated performance metrics and individual performance contributions. Another component of our overall compensation program is long-term equity, which is offered to eligible employees through annual and individual grants.
In addition, eligible employees receive a discretionary annual 401k employer contribution and may participate in our bonus program, which is tied to the performance of our businesses against defined metrics as well as individual contributions.
In the course of our extensive acquisition history, we have acquired a number of manufacturing and distribution facilities, and most of these facilities have not been subjected to Phase II environmental tests to determine whether they are contaminated.
Over the course of our extensive acquisition history, we have obtained a number of manufacturing and distribution facilities, most of which have not undergone Phase II environmental testing to determine whether contamination is present. Packaging is facing heightened scrutiny from state governments.
Garden Segment Garden Overview We are a leader in the consumer lawn and garden consumables market in the United States and offer both premium and value-oriented branded products. We also produce numerous private label products for key customers. In addition, our Garden segment operates a sales and distribution network that strategically supports our brands.
Garden Segment Garden Overview We are a leading provider in the U.S. consumer lawn and garden consumables market, offering a broad portfolio of premium and value-oriented branded products, as well as private label solutions for key customers. Our Garden segment is further supported by a strategically designed sales and distribution network that enhances brand reach and performance.
We intend to strengthen our portfolio with organic growth and acquisitions. Our M&A priorities are to build scale in our core pet and garden categories, enter priority adjacencies and enhance key capabilities, including digital and eCommerce capabilities. We generally seek growth and margin accretive, brand-focused companies with talented management teams.
Our M&A priorities include building scale in our core categories, expanding into priority adjacencies, filling whitespaces and enhancing key capabilities such as digital and eCommerce. We generally target growth- and margin-accretive, brand-focused companies led by strong management teams.
We sell these products under the Pennington brand along with several sub-brands including Lawn Booster, One Step Complete ® , Rackmaster ® , Slopemaster ® , Smart Seed, Smart Patch, The Rebels ® and other brand names. We also produce numerous private label brands of grass seed.
Products are sold under the Pennington brand and sub-brands including Lawn Booster, One Step Complete ® , Rackmaster ® , Slopemaster ® , Smart Seed, Smart Patch, The Rebels ® and others, along with private label offerings. Pennington’s seed coating and conditioning facilities rank among the largest and most advanced in the industry. Wild Bird.
We plan to continue to utilize our team of dedicated salespeople and our sales and logistics networks to expand sales of our branded pet and garden products. Strong and Experienced Leadership Team Our leadership team is committed to delivering value for all our stakeholders and is comprised of highly tenured professionals, combining both deep Central and consumer products industry expertise.
We continue to leverage our dedicated sales force and our sales and extensive logistics networks to expand distribution and grow sales of our branded pet and garden products. 3 Experienced and Entrepreneurial Leadership Team Our leadership team combines deep Central expertise with broad consumer products industry expertise.
To maximize our product placement and visibility in retail stores, we market our products through • dedicated sales forces representing our combined brand groups; • a retail sales and logistics network, which provides in-store training and merchandising for our customers, especially during the prime spring and summer seasons; • dedicated account-managers and sales teams located near several of our largest customers; and • selected independent distributors who sell our brands.
To maximize in-store placement and visibility, we deploy: • Dedicated sales forces representing our brand portfolio • A retail sales and logistics network providing in-store training and merchandising during the peak spring and summer seasons • Account managers and sales teams located near key customers • Selected independent distributors We also continue to invest in talent, digital capabilities and eCommerce, recognizing their critical role in driving growth and strengthening our leadership in the Garden segment.
Also, in fiscal 2023, the Women in Leadership Council, comprised of female leaders from across the organization, held its inaugural virtual summit, themed "Women are Central to Growth". In fiscal 2024, the Council held its first in-person summit, themed "We Rise by Lifting Others" enabling Central's women leaders to network and shape the Council's initiatives for impactful outcomes.
In fiscal 2024, our Women in Leadership Council, comprising female leaders from across the organization, held its first in-person summit, "We Rise by Lifting Others" creating opportunities for networking and shaping impactful initiatives. We further expanded Council membership to better reflect of our female leadership and introduced a dedicated Women's Leadership Track to our Mentorship Program.
We further expect lower cost of goods sold through lower logistics costs and better procurement, lower administrative costs through scale, leverage and efficiency, and a gradual shift in focus to our higher margin, higher growth potential branded pet and garden consumer products.
The program is designed to reduce complexity by streamlining our product assortment, consolidating plants and logistics centers, lowering cost of goods sold through improved logistics and procurement, and reducing administrative costs through scale and efficiency. We are also shifting our focus to our higher-margin, higher-growth branded pet and garden consumer products.
The principal raw materials required for our bird feed are bulk commodity grains, including millet, milo and sunflower seeds, which are generally purchased from large national commodity companies and local grain cooperatives.
We actively monitor and evaluate our supplier network to ensure quality, cost-effectiveness, and sufficient manufacturing capacity. For our bird feed products, essential raw materials include bulk commodity grains such as millet, milo and sunflower seeds, which we procure from large national commodity companies and local grain cooperatives.
Our turf and forage grass seed products, fertilizers, pesticides and combination products compete principally against products marketed by The Scotts Miracle-Gro Company. In addition, Spectrum Brands and S.C. Johnson & Son, Inc. are strong competitors in yard and household insecticides. Our Garden segment competes primarily based on its strong premium and value brands, quality, service, price and low-cost manufacturing.
Garden Competition The lawn and garden consumables industry is intensely competitive, with numerous national, regional and private label suppliers. Our turf and forage grass seed, fertilizers, pesticides and combination products compete primarily with offerings from The Scotts Miracle-Gro Company, while Spectrum Brands and S.C. Johnson & Son, Inc. represent major competitors in yard and household insecticides.
Information contained on our web site is not part of this report. 11
The information contained on our website is not incorporated by reference into, and does not form part of, this report. 10

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeWe continue to make additional investments to access this channel more effectively, but there can be no assurances that any such investments will be successful. If we are not successful in developing and utilizing eCommerce channels that consumers may prefer, we may experience lower than expected revenues.
Biggest changeTo the extent that the key retailers, including retailers in the pet specialty segment, on which we depend lose share to the eCommerce channel, we could lose sales. We continue to make additional investments to access this channel more effectively, but there can be no assurances that any such investments will be successful.
In connection with the our annual goodwill impairment testing performed during fiscal 2023, we elected to bypass the qualitative assessment and proceeded directly to performing the quantitative goodwill impairment test. We completed our quantitative assessment of potential goodwill and determined that it was more likely than not the fair values of our reporting segments were greater than their carrying amounts.
In connection with our annual goodwill impairment testing performed during fiscal 2023, we elected to bypass the qualitative assessment and proceeded directly to performing the quantitative goodwill impairment test. We completed our quantitative assessment of potential goodwill and determined that it was more likely than not the fair values of our reporting segments were greater than their carrying amounts.
Factors that may contribute to this variability include: • the uncertain macro-economic environment, including high interest rates and the potential imposition of trade tariffs, could lead to a recession, and the impact any of those could have on consumer discretionary spending; • seasonality and the impact of adverse weather conditions; • fluctuations in prices of commodity grains and other input costs; • supply chain and sourcing disruptions, including due to the volatile geopolitical environment and the potential imposition of trade tariffs on countries from which we import products; • a return to high inflation and the ability to take pricing actions to mitigate high input costs, including for commodities; • shifts in demand for lawn and garden and pet products; • changes in product mix, service levels, marketing and pricing by us and our competitors; • the effect of acquisitions; and • the strength of our relationships with key retailers and their buying patterns and economic stability.
Factors that may contribute to this variability include: • the uncertain macro-economic environment, including elevated interest rates and trade tariffs, could lead to a recession, and the impact any of those could have on consumer discretionary spending; • seasonality and the impact of adverse weather conditions; • fluctuations in prices of commodity grains and other input costs; • supply chain and sourcing disruptions, including the volatile geopolitical environment and the potential imposition of trade tariffs on countries from which we import products; • a return to high inflation and the ability to take pricing actions to mitigate high input costs, including for commodities; • shifts in demand for lawn and garden and pet products; • changes in product mix, service levels, marketing and pricing by us and our competitors; • the effect of acquisitions; and • the strength of our relationships with key retailers and their buying patterns and economic stability.
We are incurring costs associated with designing and implementing enterprise resource planning (ERP) software systems with the objective of gradually migrating our businesses to one or the other of two systems. The choice of which is to be used for each business is dependent on the needs of the business unit.
We are incurring costs associated with designing and implementing enterprise resource planning (ERP) software systems and gradually migrating our businesses to one or the other of two systems. The choice of which is to be used for each business is dependent on the needs of the business unit.
These investments and transitional costs may adversely affect our operating results. If we are unable to execute on our Cost and Simplicity Program, our ability to maintain or grow margins may be negatively impacted. Our Cost and Simplicity program involves reducing costs, including procurement, logistics, manufacturing, portfolio optimization and administrative, and reducing complexity through fewer SKUs, plants and distribution centers.
These investments and transitional costs may adversely affect our operating results. If we are unable to execute on our Cost and Simplicity Agenda, our ability to maintain or grow margins may be negatively impacted. Our Cost and Simplicity agenda involves reducing costs, including procurement, logistics, manufacturing, portfolio optimization and administrative, and reducing complexity through fewer SKUs, plants and distribution centers.
If we are unable to pass through higher input costs by raising the price of our products, we may experience organic sales declines and gross margin and operating income declines. Tariffs or a global trade war could increase the cost of our products, which could adversely impact the competitiveness of our products and our financial results.
If we are unable to pass through higher input costs by raising the price of our products or altering our sourcing, we may experience organic sales declines and gross margin and operating income declines. Tariffs or a global trade war could increase the cost of our products, which could adversely impact the competitiveness of our products and our financial results.
There can be no assurance that we will be able to successfully execute our Cost and Simplicity program or that we will be able to do so within the anticipated time period, which could adversely impact our ability to improve or maintain margins and enhance long-term profitability.
There can be no assurance that we will be able to successfully execute our Cost and Simplicity agenda or that we will be able to do so within the anticipated time period, which could adversely impact our ability to improve or maintain margins and enhance long-term profitability.
On June 27, 2018, a jury returned a verdict in favor of Nite Glow on each of the three claims and awarded damages of approximately $12.6 million, which was reduced to $12.4 million. We filed our notice of appeal and the plaintiffs cross-appealed.
On June 27, 2018, a jury returned a verdict in favor of Nite Glow on each of the three claims and awarded damages of approximately $12.6 million, which was reduced to $12.4 million. We filed our notice of appeal, and the plaintiff cross-appealed.
We completed our qualitative assessment of potential goodwill impairment and determined that it was more likely than not the fair values of our reporting segments were greater than their carrying amount in fiscal 2022, and accordingly, no further testing of goodwill was required in fiscal 2022.
We completed our qualitative assessment of potential goodwill impairment and determined that it was more likely than not the fair values of our reporting segments were greater than their carrying amount in fiscal 2025, and accordingly, no further testing of goodwill was required in fiscal 2025.
During fiscal 2024, 2023 and 2022, we performed evaluations of the fair value of our indefinite-lived trade names and trademarks. Our expected revenues were based on our future operating plan and estimates of market growth or decline for future years.
During fiscal 2025, 2024 and 2023, we performed evaluations of the fair value of our indefinite-lived trade names and trademarks. Our expected revenues were based on our future operating plan and estimates of market growth or decline for future years.
In connection with the our annual goodwill impairment testing performed during fiscal 2022, we made a qualitative evaluation about the likelihood of goodwill impairment to determine whether it was necessary to calculate the fair values of our reporting segments under the goodwill impairment test.
In connection with our annual goodwill impairment testing performed during fiscal 2024, we made a qualitative evaluation about the likelihood of goodwill impairment to determine whether it was necessary to calculate the fair values of our reporting segments under the goodwill impairment test.
As part of our annual goodwill impairment testing, in fiscal 2024 we made a qualitative evaluation about the likelihood of goodwill impairment to determine whether it was necessary to calculate the fair values of our reporting segments under the goodwill impairment test.
As part of our annual goodwill impairment testing, in fiscal 2025 we made a qualitative evaluation about the likelihood of goodwill impairment to determine whether it was necessary to calculate the fair values of our reporting segments under the goodwill impairment test.
To the extent the United States imposes new or additional tariffs on China or other countries, or if new or additional tariffs or trade restrictions are implemented by the United States or other countries in connection with a global trade war, the cost of our products manufactured in China or other countries, and imported into the United States could increase significantly, which in turn could adversely affect the demand for these products and have a material adverse effect on our business and results of operations.
To the extent the United States imposes new or additional tariffs on these or other countries where we or our suppliers source products, or if new or additional tariffs or trade restrictions are implemented by the United States or other countries in connection with a global trade war, the cost of our products manufactured in other countries and imported into the United States could increase significantly, which in turn could adversely affect the demand for these products and have a material adverse effect on our business and results of operations.
Deterioration in operating results could prevent us from fulfilling our obligations under the terms of our indebtedness or impact our ability to refinance our debt on favorable terms as it matures. We have, and we will continue to have, significant indebtedness. As of September 28, 2024, we had total indebtedness of approximately $1.2 billion.
Deterioration in operating results could prevent us from fulfilling our obligations under the terms of our indebtedness or impact our ability to refinance our debt on favorable terms as it matures. We have, and we will continue to have, significant indebtedness. As of September 27, 2025, we had total indebtedness of approximately $1.2 billion.
These two systems are replacing numerous accounting and financial reporting systems, most of which have been obtained in connection with business acquisitions. To date, we have reduced the number of ERP systems from 47 to 11.
These two systems are replacing numerous accounting and financial reporting systems, most of which have been obtained in connection with business acquisitions. To date, we have reduced the number of ERP systems from 46 to 6.
Our former Chief Executive Officer resigned in October 2023, and our Chief Financial Officer was promoted to Chief Executive Officer in September 2024 and the former chief financial officer of our Pet segment was promoted to our Chief Financial Officer.
In September 2024, our Chief Financial Officer was promoted to Chief Executive Officer and the former chief financial officer of our Pet segment was promoted to our Chief Financial Officer.
Home Depot, our largest customer, represented approximately 17% of our total company net sales in fiscal year 2024 and 16% of our total company net sales in fiscal 2023 and 2022. Walmart, our second largest customer, represented approximately 16% of our total company net sales in fiscal 2024 and 2023, and 17% in fiscal 2022.
Walmart, our largest customer in fiscal 2025, represented approximately 17% of total net sales in fiscal 2025 and 16% of total net sales in fiscal 2024 and 2023. Home Depot, our second largest customer in fiscal 2025, represented approximately 16% of total net sales in fiscal 2025, 2024 and 2023.
Holders of our Class A common stock have no voting rights, except as required by Delaware law. As of September 28, 2024, William E. Brown, our Chairman and founder, beneficially controlled approximately 55% of the voting power of our capital stock.
Holders of our Class A common stock have no voting rights, except as required by Delaware law. As of September 27, 2025, William E. Brown, our Chairman and founder, beneficially controlled approximately 56% of the voting power of our capital stock.
In fiscal 2024, approximately 66% of our Garden segment’s net sales and 59% of our total net sales occurred during our second and third fiscal quarters. Substantially all of the Garden segment’s operating income is generated in this period.
In fiscal 2025, approximately 64% of our Garden segment’s net sales and 57% of our total net sales occurred during our second and third fiscal quarters. Substantially all of the Garden segment’s operating income is generated in this period.
Our operating results and cash flow are susceptible to fluctuations. We expect to continue to experience variability in our net sales, net income and cash flow on a quarterly basis.
We expect to continue to experience variability in our net sales, net income and cash flow on a quarterly basis.
We sell our products through a variety of trade channels with a significant portion dependent upon key retailers, through both traditional brick-and-mortar retail channels and eCommerce channels, including Amazon. The eCommerce channel continues to grow rapidly. To the extent that the key retailers on which we depend lose share to the eCommerce channel, we could lose sales.
We sell our products through a variety of trade channels with a significant portion dependent upon key retailers, through both traditional brick-and-mortar retail channels and eCommerce channels, including Amazon. The eCommerce channel continues to grow rapidly.
In fiscal 2024, energy prices remained elevated, resulting in increased costs for fuel and raw materials for many of our products. Energy prices may continue to rise or remain elevated during fiscal 2025.
High energy prices could adversely affect our operating results. In fiscal 2025, energy prices remained elevated, resulting in increased costs for fuel and raw materials for many of our products. Energy prices may continue to rise or remain elevated during fiscal 2026.
Risks Affecting our Business Economic uncertainty and other adverse macro-economic conditions, including high interest rates and potential tariffs, may harm our business.
Risks Affecting our Business Economic uncertainty and other adverse macro-economic conditions, including interest rate fluctuations and tariffs, may harm our business.
Our performance is substantially dependent upon the continued services of our senior management team. The loss of the services of these persons could have a material adverse effect on our business.
General Risks Our success depends upon our retaining and recruiting key personnel. Our performance is substantially dependent upon the continued services of our senior management team. The loss of the services of these persons could have a material adverse effect on our business.
The market shares of many of these key retailers have increased and may continue to increase in future years. The loss of, or significant adverse change in, our relationship with any of these key retailers could cause our net sales, operating income and cash flow to decline.
The loss of, or significant adverse change in, our relationship with any of these key retailers could cause our net sales, operating income and cash flow to decline.
The court affirmed the jury's liability verdict on the misappropriation of confidential information claim but ordered a new trial on damages on that single claim limited to the "head start" benefit, if any, generated by the confidential information. The retrial of the “head start” damages issue concluded in March 2024, but no decision has been issued by the Court.
The court affirmed the jury's liability verdict on the misappropriation of confidential information claim but ordered a new trial on damages on that single claim limited to the "head start" benefit, if any, generated by the confidential information.
While the rate of inflation continued to slow during fiscal 2024, and a recession has not materialized, interest rates remain high and the imposition of tariffs on imports by the new presidential administration could result in higher input costs.
While the rate of inflation moderated during fiscal 2025, and a recession has not materialized, interest rates remain high and the imposition of tariffs on imports by the U.S. administration has resulted in higher input costs.
In fiscal 2024, we recorded a non-cash impairment charge in our Pet segment of $12.8 million, and in fiscal 2023, we recorded impairment charges of approximately $7.5 million and $3.9 million in our Pet and Garden segments. There was no impairment loss recorded in fiscal 2022.
As a result, we recorded a non-cash impairment charge in our Pet segment of $1.0 million in fiscal 2025, $12.8 million in fiscal 2024, and $7.5 million and $3.9 million in our Pet and Garden segments, respectively in fiscal 2023.
Our future performance depends on the success of our recently promoted Chief Executive Officer and Chief Financial Officer and our ability to attract and retain skilled employees in all facets of our business, including management and manufacturing and distribution.
Our future performance depends on the continued success of our Chief Executive Officer and Chief Financial Officer and our ability to attract and retain skilled employees in all facets of our business, including management and manufacturing and distribution. We cannot assure you that we will be able to retain our existing personnel or attract additional qualified employees in the future.
We intend to vigorously pursue our defenses in any future proceedings and believe that we will prevail on the merits as to the head start damages issue.
We intend to appeal the judgment and believe that we will prevail on the merits as to the head start damages issue.
The success of our business also depends in part on our ability to identify and respond to evolving trends in demographics and consumer preferences. Our failure to timely identify or effectively respond to changing consumer tastes, preferences, spending patterns and lawn and garden and pet care needs could adversely affect the demand for our products and our profitability.
Our failure to timely identify or effectively respond to changing consumer tastes, preferences, spending patterns and lawn and garden and pet care needs could adversely affect the demand for our products and our profitability. Our operating results and cash flow are susceptible to fluctuations.
Any material decline in consumer discretionary spending could reduce our sales and harm our business. Unfavorable economic and market conditions may also place a number of our key retail customers under financial stress, which would increase our credit risk and potential bad debt exposure.
Unfavorable economic and market conditions may also place a number of our key retail customers under financial stress, which would increase our credit risk and potential bad debt exposure. The success of our business also depends in part on our ability to identify and respond to evolving trends in demographics and consumer preferences.
We cannot assure you that we will be able to retain our existing personnel or attract additional qualified employees in the future. A significant information security or operational technology incident, including a cyber attack or data breach, could disrupt our operations and adversely impact our operating results, cash flows and reputation.
A significant information security or operational technology incident, including a cyber attack or data breach, could disrupt our operations and adversely impact our operating results, cash flows and reputation.
A significant deterioration in the financial condition of one of our major customers or several smaller customers could have a material adverse effect on our sales, profitability and cash flow. We continually monitor and evaluate the credit status of our customers and attempt to adjust sales terms as appropriate.
If we are not successful in developing and utilizing eCommerce channels that consumers may prefer, we may experience lower than expected revenues. A significant deterioration in the financial condition of one of our major customers or several smaller customers could have a material adverse effect on our sales, profitability and cash flow.
Costco, our third largest customer, represented approximately 8%, 7% and 6% of our total company net sales in fiscal 2024, 2023 and 2022, respectively. Lowe's and Amazon are also significant customers, and together with Walmart, Home Depot and Costco accounted for approximately 54% of our net sales in fiscal 2024.
Costco, Lowe's and Amazon are also significant customers, and together with Walmart and Home Depot, accounted for approximately 54% of our net sales in fiscal 2025 and 2024. The market shares of many of these key retailers have increased and may continue to increase in future years.
Less than 15% of our cost of goods sold is from products or materials sourced from outside the United States, including less than 5% from China.
During 2025, the U.S. Administration has imposed significant tariffs on goods imported, ranging from a 10% baseline to much higher rates on a variety of imports. In fiscal 2025, less than 15% of our cost of goods sold was from products or materials sourced from outside the United States, primarily from China, Brazil and Mexico.
Removed
During the 2024 presidential campaign, the President-Elect stated his intention to impose significant tariffs on goods imported from China and other countries. During the President-Elect’s prior administration, the United States imposed a series of tariffs, ranging from 5% to 25%, on a variety of imports from China and subsequently implemented tariffs on additional goods imported from China.
Added
Any material decline in consumer discretionary spending could reduce our sales and harm our business. For example, in the last few years, we have seen a decline in demand for durable goods in certain of our categories, resulting in part from the residual effect of inflated demand for durable goods in the early years of the COVID-19 pandemic.
Removed
Our business is dependent upon our ability to continue to source products from China. We outsource a portion of our manufacturing requirements to third-party manufacturers located in China.
Added
In fiscal 2025, grass seed market prices remained low although the oversupply of grass seed is beginning to moderate.
Removed
This subjects us to a number of risks, including: the impact of Chinese public health and contamination risks on manufacturing; quality control issues; social and political disturbances and instability; export duties, import controls, tariffs, quotas and other trade barriers; shipping and transportation problems; and fluctuations in currency values.
Added
If one or more of these customers were to cancel product orders, become insolvent, or otherwise be unable or fail to pay for our products in a timely manner, our operating results and financial condition could be materially and adversely affected. We continually monitor and evaluate the credit status of our customers and attempt to adjust sales terms as appropriate.
Removed
These risks may be heightened by threatened changes in the U.S. government's trade policies, including the continuation of tariffs on goods imported from China or the imposition of any new or increased tariffs.
Added
The retrial of the “head start” damages issue concluded in March 2024, and the court issued its decision on September 30, 2025 awarding the plaintiff $5.0 million. The judgment was entered on October 17, 2025 in the amount of $7.2 million, including prejudgment interest.
Removed
Because we rely on Chinese third-party manufacturers for a significant portion of our product needs, any disruption in our relationships with these manufacturers or significant increase in import tariffs could adversely affect our results of operations. High energy prices could adversely affect our operating results.
Removed
We identified material weaknesses in our internal control over financial reporting during fiscal 2023 and may identify additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls, which may result in material misstatements or otherwise adversely affect the accuracy, reliability or timeliness of our financial statements. As described under Item 9A.
Removed
"Controls and Procedures" below, we concluded that material weaknesses in our internal control over financial reporting existed as of September 30, 2023 and, accordingly, our internal control over financial reporting and our disclosure controls and procedures were not effective as of such date.
Removed
A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim consolidated financial statements will not be prevented or detected on a timely basis.
Removed
As a result of its evaluation, management identified two material weaknesses: (1) in information technology general computer controls ("ITGCs") relating to access and program change management controls and (2) controls relating to an outsourced service provider at two acquired businesses whose IT systems had not yet been fully integrated with our corporate IT control structure.
Removed
Management established a remediation plan that involved implementing additional controls to ensure that access and program change management controls are designed and operating effectively and that we have effective controls relating to outsourced service providers and the data they provide. The remediation plan was implemented and tested during fiscal 2024 and deemed effective.
Removed
However, we cannot provide assurance that additional material weaknesses in our internal controls will not be identified in the future. Effective internal control over financial reporting is necessary for us to provide reliable and timely financial reports and, together with adequate disclosure controls and procedures, are designed to reasonably detect and prevent fraud.
Removed
The occurrence of, or failure to remediate, these material weaknesses and any future material weaknesses in our internal control over financial reporting may adversely affect the accuracy and reliability and timeliness of our financial statements and have other consequences that could materially and adversely affect our business. General Risks Our success depends upon our retaining and recruiting key personnel.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur approach includes, among other things: • conducting regular network and endpoint monitoring, vulnerability assessments, and penetration testing to improve our information systems, as such term is defined in Item 106(a) of Regulation S-K; • running tabletop exercises to simulate a response to a cybersecurity incident and use the findings to improve our processes and technologies; • regular, mandatory cybersecurity training programs for relevant employees; • comparing our processes to standards set by the International Organization for Standardization (“ISO”); • leveraging the ISO information security incident management model to help us identify, protect, detect, respond, and recover when there is an actual or potential cybersecurity incident; • leveraging third-party threat intelligence services designed to model and research our adversaries; • closely monitoring emerging data protection laws and implementing changes to our processes designed to comply; • periodically reviewing our consumer facing policies and statements related to cybersecurity; • conducting regular phishing email simulations for relevant employees and all contractors with access to corporate email systems to enhance awareness and responsiveness to such possible threats; • through policy, practice and contract (as applicable) requiring employees, as well as third parties who provide services on our behalf, to treat customer information and data with care; and • carrying information security risk insurance that provides protection against the potential losses arising from a cybersecurity incident.
Biggest changeOur approach includes, among other things: • conducting regular network and endpoint monitoring, vulnerability assessments, and penetration testing to improve our information systems, as such term is defined in Item 106(a) of Regulation S-K; • running tabletop exercises to simulate a response to a cybersecurity incident and use the findings to improve our processes and technologies; • regular, mandatory cybersecurity training programs for relevant employees; • comparing our processes to standards set by the International Organization for Standardization (“ISO”); • leveraging the ISO information security incident management model to help us identify, protect, detect, respond, and recover when there is an actual or potential cybersecurity incident; • leveraging third-party threat intelligence services designed to model and research our adversaries; • closely monitoring emerging data protection laws and implementing changes to our processes designed to comply; 11 • periodically reviewing our consumer facing policies and statements related to cybersecurity; • conducting regular phishing email simulations for relevant employees and all contractors with access to corporate email systems to enhance awareness and responsiveness to such possible threats; • through policy, practice and contract (as applicable) requiring employees, as well as third parties who provide services on our behalf, to treat customer information and data with care; and • carrying information security risk insurance that provides protection against the potential losses arising from a cybersecurity incident.
We describe how risks associated with a potential cybersecurity incident are reasonably likely to materially affect us, including our business, results of operations and financial condition, under the heading “A significant information security or operational technology 12 incident, including a cyberattack or a data breach, could disrupt our operations and adversely impact our operating results, cash flows and reputation,” included as part of our risk factor disclosures at Item 1A of this Annual Report on Form 10-K, which disclosures are incorporated by reference herein.
We describe how risks associated with a potential cybersecurity incident are reasonably likely to materially affect us, including our business, results of operations and financial condition, under the heading “A significant information security or operational technology incident, including a cyberattack or a data breach, could disrupt our operations and adversely impact our operating results, cash flows and reputation,” included as part of our risk factor disclosures at Item 1A of this Annual Report on Form 10-K, which disclosures are incorporated by reference herein.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeIn addition to the manufacturing and sales and distribution facilities, the Garden segment leases approximately 245 acres of land in Oregon, New Jersey and Virginia used in its grass seed and live plant operations and owns approximately 2,402 acres of land in Virginia, North Carolina, Maryland, Ohio, New Jersey and Kentucky used in its live plant operations.
Biggest changeOur executive offices are located in Walnut Creek, California. 12 In addition to the manufacturing and sales and distribution facilities, the Garden segment leases approximately 239 acres of land in New Jersey and Virginia used in its grass seed and live plant operations and owns approximately 2,402 acres of land in Virginia, North Carolina, Maryland, Ohio, New Jersey and Kentucky used in its live plant operations.
The Pet segment leases approximately 80 acres of land in Florida to support its live fish operations. We continually review the number, location and size of our manufacturing and sales and logistics facilities and expect to make changes over time to optimize our manufacturing and distribution footprints.
The Pet segment leases approximately 60 acres of land in Florida to support its live fish operations. We continually review the number, location and size of our manufacturing and sales and logistics facilities and expect to make changes over time to optimize our manufacturing and distribution footprints.
We lease 17 of our manufacturing facilities and 45 of our sales and logistics facilities. These leases generally expire between fiscal years 2024 and 2034. Substantially all of the leases contain renewal provisions with automatic rent escalation clauses. The facilities we own are subject to major encumbrances under our principal credit facility.
We lease 15 of our manufacturing facilities and 40 of our sales and logistics facilities. These leases generally expire between fiscal years 2026 and 2034. Substantially all of the leases contain renewal provisions with automatic rent escalation clauses. The facilities we own are subject to major encumbrances under our principal credit facility.
Item 2. Properties We currently operate 40 manufacturing facilities totaling approximately 6.4 million square feet and 57 sales and distribution facilities totaling approximately 5.9 million square feet. Most sales and distribution centers consist of office and warehouse space, and several large bays for loading and unloading.
Item 2. Properties We currently operate 37 manufacturing facilities totaling approximately 6.1 million square feet and 52 sales and distribution facilities totaling approximately 5.7 million square feet. Most sales and distribution centers consist of office and warehouse space, and several large bays for loading and unloading.
Each sales and distribution center provides warehouse, distribution, sales and support functions for its geographic area. Our executive offices are located in Walnut Creek, California.
Each sales and distribution center provides warehouse, distribution, sales and support functions for its geographic area.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeThe Company intends to vigorously pursue its defenses in any future proceedings and believes that it will prevail on the merits as to the head start damages issue.
Biggest changeOn September 30, 2025, the court issued its decision awarding the plaintiff $5.0 million, and judgment was entered on October 17, 2025 in the amount of $7.2 million, including prejudgment interest. The Company intends to appeal the judgment and believes that it will prevail in the appeal and in any further proceedings as to the head start damages issue.
The court affirmed the jury's liability verdict on the misappropriation of confidential information claim but ordered a new trial on damages on that single claim limited to the "head start" benefit, if any, generated by the confidential information. The retrial on the "head start" damages issue concluded in early March 2024, but no decision has been issued by the court.
The court affirmed the jury's liability verdict on the misappropriation of confidential information claim but ordered a new trial on damages on that single claim limited to the "head start" benefit, if any, generated by the confidential information. The retrial on the "head start" damages issue concluded in early March 2024.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeTotal Return Analysis 9/28/2019 9/26/2020 9/25/2021 9/24/2022 9/30/2023 9/28/2024 Central Garden & Pet Company $ 100.00 $ 127.75 $ 157.72 $ 127.21 $ 149.17 $ 158.25 NASDAQ Composite $ 100.00 $ 138.88 $ 192.89 $ 140.41 $ 172.35 $ 238.13 Dow Jones US Nondurable Household Products $ 100.00 $ 115.15 $ 119.69 $ 114.80 $ 127.19 $ 159.31 15 Purchases of Equity Securities by the Issuer and Affiliated Purchasers The following table sets forth the repurchases of any equity securities during the fourth quarter of the fiscal year ended September 28, 2024 and the dollar amount of authorized share repurchases remaining under our stock repurchase programs.
Biggest changeThe comparisons in the graph below are based on historical data and are not indicative of, or intended to forecast, the possible future performance of our Common Stock. 15 Total Return Analysis 9/26/2020 9/25/2021 9/24/2022 9/30/2023 9/28/2024 9/27/2025 Central Garden & Pet Company $ 100.00 $ 123.47 $ 99.58 $ 116.77 $ 123.88 $ 112.32 NASDAQ Composite $ 100.00 $ 138.82 $ 101.01 $ 123.97 $ 171.21 $ 213.87 Dow Jones US Nondurable Household Products $ 100.00 $ 103.94 $ 99.70 $ 110.46 $ 138.35 $ 121.25 Purchases of Equity Securities by the Issuer and Affiliated Purchasers The following table sets forth the repurchases of any equity securities during the fourth quarter of the fiscal year ended September 27, 2025 and the dollar amount of authorized share repurchases remaining under our stock repurchase programs.
The 2019 Repurchase Authorization has no fixed expiration date and expires when the amount authorized has been used or the Board withdraws its authorization. The repurchase of shares may be limited by certain financial covenants in our credit facility that restrict our ability to repurchase our stock.
The 2024 Repurchase Authorization has no fixed expiration date and expires when the amount authorized has been used or the Board withdraws its authorization. The repurchase of shares may be limited by certain financial covenants in our credit facility that restrict our ability to repurchase our stock.
Our Class B stock is not listed on any market and generally cannot be transferred unless converted to common stock on a one-for-one basis. As of November 15, 2024, there were 60 holders of record of our common stock, 367 holders of record of our Class A nonvoting common stock and three holders of record of our Class B stock.
Our Class B stock is not listed on any market and generally cannot be transferred unless converted to common stock on a one-for-one basis. As of November 19, 2025, there were 60 holders of record of our common stock, 367 holders of record of our Class A nonvoting common stock and three holders of record of our Class B stock.
Stock Performance Graph The following graph compares the percentage change of our cumulative total stockholder return on our Common Stock (“CENT”) for the period from September 29, 2018 to September 28, 2024 with the cumulative total return of the NASDAQ Composite (U.S.) Index and the Dow Jones Non-Durable Household Products Index, a peer group index consisting of approximately 30 manufacturers and distributors of household products.
Stock Performance Graph The following graph compares the percentage change of our cumulative total stockholder return on our Common Stock (“CENT”) for the period from September 26, 2020 to September 27, 2025 with the cumulative total return of the NASDAQ Composite (U.S.) Index and the Dow Jones Non-Durable Household Products Index, a peer group index consisting of approximately 30 manufacturers and distributors of household products.
As of November 21, 2024, we had $30.3 million remaining under our 2019 Repurchase Authorization. (2) In February 2019, our Board of Directors authorized us to make supplemental stock purchases to minimize dilution resulting from issuances under our equity compensation plans (the “Equity Dilution Authorization”).
As of September 27, 2025, we had $46.5 million of authorization remaining under our 2024 Repurchase Authorization. (2) In February 2019, our Board of Directors authorized us to make supplemental stock purchases to minimize dilution resulting from issuances under our equity compensation plans (the “Equity Dilution Authorization”).
The Equity Dilution Authorization has no fixed expiration date and expires when the Board withdraws its authorization. (3) Shares purchased during the period indicated represent withholding of a portion of shares to cover taxes in connection with the vesting of restricted stock and do not reduce the dollar value of shares that may be purchased under our stock repurchase plan.
(3) Shares purchased during the period indicated represent withholding of a portion of shares to cover taxes in connection with the vesting of restricted stock and do not reduce the dollar value of shares that may be purchased under our stock repurchase plan. 16 Item 6. Reserved
Period Total Number of Shares (or Units) Purchased Average Price Paid per Share (or Unit) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs (1) (2) June 30, 2024 – August 3, 2024 32,942 (2) (3) $ 31.85 29,019 $ 81,951,000 August 4, 2024 – August 31, 2024 9,758 (2) (3) $ 32.53 3,100 81,951,000 September 1, 2024 – September 28, 2024 258,293 (2) (3) $ 32.63 257,590 81,951,000 Total 300,993 $ 32.55 289,709 $ 81,951,000 (4) (1) In August 2019, our Board of Directors authorized a share repurchase program to purchase up to $100 million of our common stock (the "2019 Repurchase Authorization”).
Period Total Number of Shares (or Units) Purchased Average Price Paid per Share (or Unit) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs (1) (2) June 29, 2025 – August 2, 2025 3,924 (3) $ 35.85 — $ 46,474,000 August 3, 2025 – August 30, 2025 1,912 (3) $ 31.22 — 46,474,000 August 31, 2025 – September 27, 2025 702 (3) $ 32.55 — 46,474,000 Total 6,538 $ 34.14 — $ 46,474,000 (2) (1) In December 2024, our Board of Directors authorized a $100 million increase in our share repurchase program (the "2024 Repurchase Authorization”).
Removed
The comparisons in the graph below are based on historical data and are not indicative of, or intended to forecast, the possible future performance of our Common Stock.
Added
The Equity Dilution Authorization has no fixed expiration date and expires when the Board withdraws its authorization. There were no shares remaining under our Equity Dilution Authorization as of September 27, 2025.
Removed
As of September 28, 2024, we had $82.0 million of authorization remaining under our 2019 Repurchase Authorization. From September 29, 2024 through November 21, 2024, we repurchased 1.3 million shares of our non-voting common stock (CENTA) and 0.4 million shares of our voting common stock (CENT) on the open market at an aggregate cost of $51.7 million.
Removed
(4) Excludes 38 thousand shares remaining under our Equity Dilution Authorization as of September 28, 2024. 16 Item 6. Reserved

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeAdditionally, we recognized a $7.5 million non-cash impairment charge for two related private company investments that is included within Other income (expense) in the consolidated statement of operations. 22 Net Income and Diluted Net Income Per Share Reconciliation GAAP to Non-GAAP Reconciliation Fiscal Year Ended September 28, 2024 September 30, 2023 (in thousands, except per share amount) GAAP net income attributable to Central Garden & Pet Company $ 107,983 $ 125,643 Facility closures (1)(2)(3)(5) 27,842 15,672 Intangible impairments (6)(7) 12,790 6,731 Litigation settlement (8) (3,200) — Independent channel distribution business sale (4) — (5,844) Investment impairment (8) 7,461 — Tax effect of adjustments (10,437) (3,705) Non-GAAP net income attributable to Central Garden & Pet Company $ 142,439 $ 138,497 GAAP diluted net income per share $ 1.62 $ 1.88 Non-GAAP diluted net income per share $ 2.13 $ 2.07 Shares used in GAAP and non-GAAP diluted net income per share calculation 66,860 66,783 Operating Income Reconciliation GAAP to Non-GAAP Reconciliation Fiscal Year Ended September 28, 2024 Fiscal Year Ended September 30, 2023 GAAP Adjustments (1)(2)(3)(6)(8) Non-GAAP GAAP Adjustments (4)(5)(7) Non-GAAP (in thousands) (in thousands) Net sales $ 3,200,460 $ — $ 3,200,460 $ 3,310,083 $ — $ 3,310,083 Cost of goods sold and occupancy 2,256,725 16,349 2,240,376 2,363,241 9,761 $ 2,353,480 Gross profit 943,735 (16,349) 960,084 946,842 (9,761) $ 956,603 Selling, general and administrative expenses 758,348 21,083 737,265 736,196 6,798 $ 729,398 Income from operations $ 185,387 $ (37,432) $ 222,819 $ 210,646 $ (16,559) $ 227,205 Gross margin 29.5 % 30.0% 28.6% 28.9 % Operating margin 5.8 % 7.0% 6.4% 6.9 % Pet Segment Operating Income Reconciliation GAAP to Non-GAAP Reconciliation Fiscal Year Ended September 28, 2024 September 30, 2023 (in thousands) GAAP operating income $ 203,425 $ 198,004 Facility closures (1)(5) 7,549 15,672 Intangible impairments (6)(7) 12,790 2,785 Non-GAAP operating income $ 223,764 $ 216,461 GAAP operating margin 11.1 % 10.5 % Non-GAAP operating margin 12.2 % 11.5 % 23 Garden Segment Operating Income Reconciliation GAAP to Non-GAAP Reconciliation Fiscal Year Ended September 28, 2024 September 30, 2023 (in thousands) GAAP operating income $ 81,893 $ 123,455 Facility closures (1)(2)(3) 20,293 — Independent channel distribution business sale (4) — (5,844) Intangible impairments (7) — 3,946 Non-GAAP operating income $ 102,186 $ 121,557 GAAP operating margin 6.0 % 8.6 % Non-GAAP operating margin 7.5 % 8.5 % Organic Net Sales Reconciliation GAAP to Non-GAAP Reconciliation Fiscal Year Ended September 28, 2024 Net sales (GAAP) Effect of acquisitions & divestitures on net sales Net sales organic (in millions) Reported net sales FY 2024 $ 3,200.5 $ 66.4 $ 3,134.1 Reported net sales FY 2023 3,310.1 48.1 3,262.0 $ decrease $ (109.6) $ 18.3 $ (127.9) % decrease (3.3) % (3.9) % Organic Pet Segment Net Sales Reconciliation GAAP to Non-GAAP Reconciliation Fiscal Year Ended September 28, 2024 Net sales (GAAP) Effect of acquisitions & divestitures on net sales Net sales organic (in millions) Reported net sales FY 2024 $ 1,832.8 $ 66.4 $ 1,766.4 Reported net sales FY 2023 1,877.2 — 1,877.2 $ decrease $ (44.4) $ 66.4 $ (110.8) % decrease (2.4) % (5.9) % Organic Garden Segment Net Sales Reconciliation GAAP to Non-GAAP Reconciliation Fiscal Year Ended September 28, 2024 Net sales (GAAP) Effect of acquisitions & divestitures on net sales Net sales organic (in millions) Reported net sales FY 2024 $ 1,367.7 $ — $ 1,367.7 Reported net sales FY 2023 1,432.9 48.1 1,384.8 $ decrease $ (65.2) $ (48.1) $ (17.1) % decrease (4.6) % (1.2) % 24 Adjusted EBITDA Reconciliation GAAP to Non-GAAP Reconciliation Fiscal Year Ended September 28, 2024 Pet Garden Corp Total (in thousands) Net income attributable to Central Garden & Pet $ — $ — $ — $ 107,983 Interest expense, net — — — 37,872 Other expense — — — 5,090 Income tax expense — — — 33,112 Net income attributable to noncontrolling interest — — — 1,330 Sum of items below operating income — — — 77,404 Income (loss) from operations 203,425 81,893 (99,931) 185,387 Depreciation & amortization 43,642 44,403 2,762 90,807 Noncash stock-based compensation — — 20,583 20,583 Non-GAAP adjustments (1)(2)(3)(6)(8) 20,339 20,293 (3,200) 37,432 Adjusted EBITDA $ 267,406 $ 146,589 $ (79,786) $ 334,209 Adjusted EBITDA Reconciliation GAAP to Non-GAAP Reconciliation Fiscal Year Ended September 30, 2023 Pet Garden Corp Total (in thousands) Net income attributable to Central Garden & Pet $ — $ — $ — $ 125,643 Interest expense, net — — — 49,663 Other income — — — (1,462) Income tax expense — — — 36,348 Net income attributable to noncontrolling interest — — — 454 Sum of items below operating income — — — 85,003 Income (loss) from operations 198,004 123,455 (110,813) 210,646 Depreciation & amortization 41,126 43,375 3,199 87,700 Noncash stock-based compensation — — 27,990 27,990 Non-GAAP adjustments (4)(5)(7) 18,457 (1,898) — 16,559 Adjusted EBITDA $ 257,587 $ 164,932 $ (79,624) $ 342,895 Inflation Our revenues and margins are dependent on various economic factors, including rates of inflation, energy costs, interest rates, consumer attitudes toward discretionary spending, currency fluctuations, and other macro-economic factors which may impact levels of consumer spending.
Biggest changeAdditionally, we recognized a $7.5 million non-cash impairment charge for two related private company investments that is included within Other income (expense) in the consolidated statement of operations. 21 Net Income and Diluted Net Income Per Share GAAP to Non-GAAP Reconciliation Fiscal Year Ended September 27, 2025 September 28, 2024 (in thousands, except per share amount) GAAP net income attributable to Central Garden & Pet Company $ 162,843 $ 107,983 Facility closures & business exits (1)(2)(3)(4) 15,005 27,842 Intangible impairments (5) — 12,790 Litigation settlement (6) — (3,200) Investment impairment (6) — 7,461 Tax effect of adjustments (3,654) (10,437) Non-GAAP net income attributable to Central Garden & Pet Company $ 174,194 $ 142,439 GAAP diluted net income per share $ 2.55 $ 1.62 Non-GAAP diluted net income per share $ 2.73 $ 2.13 Shares used in GAAP and non-GAAP diluted net income per share calculation 63,815 66,860 Operating Income GAAP to Non-GAAP Reconciliation Fiscal Year Ended September 27, 2025 Fiscal Year Ended September 28, 2024 GAAP Adjustments (1)(2) Non-GAAP GAAP Adjustments (3)(4)(5)(6) Non-GAAP (in thousands) (in thousands) Net sales $ 3,129,064 $ — $ 3,129,064 $ 3,200,460 $ — $ 3,200,460 Cost of goods sold and occupancy 2,131,728 5,582 2,126,146 2,256,725 16,349 $ 2,240,376 Gross profit $ 997,336 $ (5,582) $ 1,002,918 $ 943,735 $ (16,349) $ 960,084 Selling, general and administrative expenses 747,294 9,423 737,871 758,348 21,083 737,265 Income from operations $ 250,042 $ (15,005) $ 265,047 $ 185,387 $ (37,432) $ 222,819 Gross margin 31.9 % 32.1% 29.5% 30.0% Operating margin 8.0 % 8.5% 5.8% 7.0% Pet Segment Operating Income GAAP to Non-GAAP Reconciliation Fiscal Year Ended September 27, 2025 September 28, 2024 (in thousands) GAAP operating income $ 215,688 $ 203,425 Facility closures (2)(4) 10,018 7,549 Intangible impairments (5) — 12,790 Non-GAAP operating income $ 225,706 $ 223,764 GAAP operating margin 12.0% 11.1% Non-GAAP operating margin 12.5% 12.2% 22 Garden Segment Operating Income GAAP to Non-GAAP Reconciliation Fiscal Year Ended September 27, 2025 September 28, 2024 (in thousands) GAAP operating income $ 142,402 $ 81,893 Facility closures (1)(3) 4,987 20,293 Non-GAAP operating income $ 147,389 $ 102,186 GAAP operating margin 10.7% 6.0% Non-GAAP operating margin 11.1% 7.5% 23 Adjusted EBITDA GAAP to Non-GAAP Reconciliation Fiscal Year Ended September 27, 2025 Pet Garden Corp Total (in thousands) Net income attributable to Central Garden & Pet $ — $ — $ — $ 162,843 Interest expense, net — — — 32,812 Other expense — — — 480 Income tax expense — — — 52,787 Net income attributable to noncontrolling interest — — — 1,120 Income (loss) from operations 215,688 142,402 (108,048) 250,042 Depreciation & amortization 39,916 42,301 2,677 84,894 Noncash stock-based compensation — — 21,060 21,060 Non-GAAP adjustments (1)(2) 10,018 4,987 — 15,005 Adjusted EBITDA $ 265,622 $ 189,690 $ (84,311) $ 371,001 Adjusted EBITDA GAAP to Non-GAAP Reconciliation Fiscal Year Ended September 28, 2024 Pet Garden Corp Total (in thousands) Net income attributable to Central Garden & Pet $ — $ — $ — $ 107,983 Interest expense, net — — — 37,872 Other expense — — — 5,090 Income tax expense — — — 33,112 Net income attributable to noncontrolling interest — — — 1,330 Income (loss) from operations 203,425 81,893 (99,931) 185,387 Depreciation & amortization 43,642 44,403 2,762 90,807 Noncash stock-based compensation — — 20,583 20,583 Non-GAAP adjustments (3)(4)(5)(6) 20,339 20,293 (3,200) 37,432 Adjusted EBITDA $ 267,406 $ 146,589 $ (79,786) $ 334,209 Inflation Our revenues and margins are dependent on various economic factors, including fluctuating rates of inflation on various input costs (e.g., commodities and energy), interest rates, currencies and consumer attitudes toward discretionary spending.
For certain agreements, 30 management estimates are used to develop the quantities and pricing for anticipated purchases, and future purchases could vary significantly from such estimates. (4) Possible performance-based payments associated with prior acquisitions of businesses are not included in the above table, because they are based on future performance of the businesses acquired, which is not yet known.
For certain agreements, management estimates are used to develop the quantities and pricing for anticipated purchases, and future purchases could vary significantly from such estimates. (4) Possible performance-based payments associated with prior acquisitions of businesses are not included in the above table, because they are based on future performance of the businesses acquired, which is not yet known.
We believe these exclusions supplement the GAAP information with a measure that may be useful to investors in assessing the sustainability of our operating performance. 21 • Asset impairment charges : we exclude the impact of asset impairments on intangible assets and investments as such non-cash amounts are inconsistent in amount and frequency.
We believe these exclusions supplement the GAAP information with a measure that may be useful to investors in assessing the sustainability of our operating performance . • Asset impairment charges: we exclude the impact of asset impairments on intangible assets and investments as such non-cash amounts are inconsistent in amount and frequency.
The obligations of each Guarantor under its Guarantee shall be limited to the maximum amount, after giving effect to all other contingent and fixed liabilities of such Guarantor and to any collections from or payments made by or on behalf of any other Guarantor in respect of the obligations of such Guarantor under the guarantee not constituting a fraudulent conveyance or fraudulent transfer under Federal or state law.
The obligations of each Guarantor under its Guarantee shall be limited to the maximum amount, after giving effect to all other contingent and fixed liabilities of such Guarantor and to any collections from or payments made by or on behalf of any other Guarantor in 27 respect of the obligations of such Guarantor under the guarantee not constituting a fraudulent conveyance or fraudulent transfer under Federal or state law.
The qualitative assessment evaluates factors including macro-economic conditions, industry-specific and company-specific considerations, legal and regulatory environments and historical performance. If it is determined that it is more likely than not the fair value of the reporting unit is greater than its carrying amount, it is unnecessary to perform the quantitative goodwill impairment test.
The qualitative assessment 29 evaluates factors including macro-economic conditions, industry-specific and company-specific considerations, legal and regulatory environments and historical performance. If it is determined that it is more likely than not the fair value of the reporting unit is greater than its carrying amount, it is unnecessary to perform the quantitative goodwill impairment test.
Non-GAAP financial measures reflect adjustments based on the following items: • Facility closures and business exit : we have excluded charges related to the closure of distribution and manufacturing facilities and our decision to exit the pottery business as they represent infrequent transactions that impact the comparability between operating periods.
Non-GAAP financial measures reflect adjustments based on the following items: • Facility closures and business exit: we have excluded charges related to the closure of distribution and manufacturing facilities and our decision to exit the pottery business as they represent infrequent transactions that impact the comparability 20 between operating periods.
In connection with our annual goodwill impairment testing performed during fiscal 2024, we made a qualitative evaluation about the likelihood of goodwill impairment to determine whether it was necessary to calculate the fair values of our reporting segments under the goodwill impairment test.
In connection with our annual goodwill impairment testing performed during fiscal year 2024, we made a qualitative evaluation about the likelihood of goodwill impairment to determine whether it was necessary to calculate the fair values of our reporting segments under the goodwill impairment test.
Future net sales and short-term growth rates are estimated for trade names based on management’s forecasted financial results which consider key business drivers such as specific revenue growth initiatives, market share changes and general economic factors such as consumer spending. During fiscal 2024, 2023 and 2022, we performed evaluations of the fair value of our indefinite-lived trade names and trademarks.
Future net sales and short-term growth rates are estimated for trade names based on management’s forecasted financial results which consider key business drivers such as specific revenue growth initiatives, market share changes and general economic factors such as consumer spending. During fiscal 2025, 2024 and 2023, we performed evaluations of the fair value of our indefinite-lived trade names and trademarks.
We completed our qualitative assessment of potential goodwill impairment and determined that it was more likely than not the fair values of our reporting segments were greater than their carrying amount in fiscal year 2022, and accordingly, no further testing of goodwill was required in fiscal year 2022.
We completed our qualitative assessment of potential goodwill impairment and determined that it was more likely than not the fair values of our reporting segments were greater than their carrying amount in fiscal year 2025, and accordingly, no further testing of goodwill was required in fiscal 2025.
Our lawn and garden businesses are highly seasonal with approximately 66% of our Garden segment’s net sales occurring during the second and third fiscal quarters. This seasonality requires the shipment of large quantities of product well ahead of the peak consumer buying periods.
Our lawn and garden businesses are highly seasonal with approximately 64% of our Garden segment’s net sales occurring during the second and third fiscal quarters. This seasonality requires the shipment of large quantities of product well ahead of the peak consumer buying periods.
However, to supplement the financial results prepared in accordance with GAAP, we use non-GAAP financial measures including non-GAAP net income and diluted net income per share, non-GAAP operating income, non-GAAP gross profit and gross margin, non-GAAP selling, general and administrative expense, adjusted EBITDA and organic net sales.
However, to supplement the financial results prepared in accordance with GAAP, we use non-GAAP financial measures including non-GAAP net income and diluted net income per share, non-GAAP operating income, non-GAAP gross profit and gross margin, non-GAAP selling, general and administrative expense and adjusted EBITDA.
We may redeem some or all of the 2030 Notes, at our option at any time on or after October 15, 2025 for 102.063%, on or after October 15, 2026 for 101.375%, on or after October 15, 2027 for 100.688% and on or after October 15, 2028 for 100.0%, plus accrued and unpaid interest.
We may redeem some or all of the 2030 Notes, at our option, in whole or in part, at any time on or after October 15, 2025 for 102.063%, on or after October 15, 2026 for 101.375%, on or after October 15, 2027 for 100.688% and on or after October 15, 2028 for 100.0%, plus accrued and unpaid interest.
We believe the adjustment of this gain supplements the GAAP information with a measure that may be used to assess the performance of our ongoing operations. • Tax impact : adjustment represents the impact of the tax effect of the pre-tax non-GAAP adjustments excluded from non-GAAP net income.
We believe that the exclusion of this gain supplements the GAAP information with a measure that can be used to assess the performance of our ongoing operations. • Tax impact: adjustment represents the impact of the tax effect of the pre-tax non-GAAP adjustments excluded from non-GAAP net income.
In connection with our annual goodwill impairment testing performed during fiscal year 2022, we made a qualitative evaluation about the likelihood of goodwill impairment to determine whether it was necessary to calculate the fair values of our reporting segments under the goodwill impairment test.
In connection with our annual goodwill impairment testing performed during fiscal 2025, we made a qualitative evaluation about the likelihood of goodwill impairment to determine whether it was necessary to calculate the fair values of our reporting segments under the goodwill impairment test.
Adjusted EBITDA is defined by us as income before income tax, net other expense, net interest expense and depreciation and amortization and stock-based compensation expense (or operating income plus depreciation and amortization expense and stock-based compensation expense). Adjusted EBITDA further excludes one-time charges related to facility closures exits of business, intangible and investment impairments and gains from a litigation settlement.
Adjusted EBITDA is defined by us as income before income tax, net other expense, net interest expense, depreciation and amortization and stock-based compensation expense (or operating income plus depreciation and amortization expense and stock-based compensation expense). Adjusted EBITDA further excludes one-time charges related to facility closures, exits of businesses, intangible and investment impairments and gains from litigation.
Intangible Impairments (6) During the fourth quarter of fiscal 2024, we recognized a non-cash impairment charge in our Pet segment of $12.8 million related to the impairment of intangible assets due primarily to changing market conditions resulting from the decline in demand for durable products and increased international competition.
Intangible Impairments (5) During fiscal 2024, we recognized a non-cash impairment charge in our Pet segment of $12.8 million related to the impairment of intangible assets due primarily to changing market conditions resulting from the decline in demand for durable products and increased international competition.
Fiscal 2023 Compared to Fiscal 2022 For a discussion of our results of operations in fiscal 2023 compared to fiscal 2022, please see Item 7 of our Annual Report on Form 10-K for the fiscal year ended September 30, 2023 filed with the SEC. Use of Non-GAAP Financial Measures We report our financial results in accordance with GAAP.
Fiscal 2024 Compared to Fiscal 2023 For a discussion of our results of operations in fiscal 2024 compared to fiscal 2023, please see Item 7 of our Annual Report on Form 10-K for the fiscal year ended September 28, 2024 filed with the SEC. Use of Non-GAAP Financial Measures We report our financial results in accordance with GAAP.
We were in compliance with all financial covenants as of September 28, 2024. 27 $500 million 4.125% Senior Notes due 2030 In October 2020, we issued $500 million aggregate principal amount of 4.125% senior notes due October 2030 (the "2030 Notes").
We were in compliance with all financial covenants as of September 27, 2025. $500 million 4.125% Senior Notes due 2030 In October 2020, we issued $500 million aggregate principal amount of 4.125% senior notes due October 2030 (the "2030 Notes").
The Company may redeem some or all of the 2031 Notes at its option, at any time on or after April 30, 2026 for 102.063%, on or after April 30, 2027 for 101.375%, on or after April 30, 2028 for 100.688% and on or after April 30, 2029 for 100.0%, plus accrued and unpaid interest.
We may redeem some or all of the 2031 Notes at our option, at any time on or after April 30, 2026 for 102.063%, on or after April 30, 2027 for 101.375%, on or after April 30, 2028 for 100.688% and on or after April 30, 2029 for 100.0%, plus accrued and unpaid interest.
Borrowings under the Credit Facility will bear interest at an index based on SOFR (which will not be less than 0.00%) or, at our option, the Base Rate, plus, in either case, an applicable margin based on our usage under the Credit Facility.
Borrowings under the Credit Facility will bear interest at an index based on SOFR (which will not be less than 0.00%) or, at our option, the Base Rate, plus, in either case, an applicable margin based on the average availability level under the Credit Facility.
In fiscal years 2021 through 2023, we were adversely impacted by high input costs due to inflation, particularly relating to prices for grain and seed, fuel and the ingredients used in our garden controls and fertilizer business as well as heightened import costs such as shipping container costs and tariffs.
In fiscal year 2021 through 2023, our operating results were adversely impacted by high input costs due to inflation, particularly relating to prices for grain and seed, fuel and the ingredients used in our garden controls and fertilizer business as well as heightened import costs such as shipping container costs and tariffs.
The holders of the 2031 Notes have the right to require us to repurchase all or a portion of the 2031 Notes at a purchase price equal to 101% of the principal amount of the notes repurchased, plus accrued and unpaid interest, upon the occurrence of specific kinds of changes of control.
The holders of the 2031 Notes have the right to require us to repurchase all or a portion of the 2031 Notes at a purchase price equal to 101% of the principal amount of the notes repurchased, plus accrued and unpaid interest, upon the occurrence of a change of control.
The Credit Facility is secured by substantially all assets of the borrowing parties, including (i) pledges of 100% of the stock or other equity interest of each domestic subsidiary that is directly owned by such entity and (ii) 65% of the stock or other equity interest of each foreign subsidiary that is directly owned by such entity, in each case subject to customary exceptions.
The Credit Facility is secured by substantially all of our assets and the assets of our subsidiaries guaranteeing the Credit Facility, including (i) pledges of 100% of the stock or other equity interest of each domestic subsidiary that is directly owned by such entity and (ii) 65% of the stock or other equity interest of each foreign subsidiary that is directly owned by such entity, in each case subject to customary exceptions.
Stock Repurchases During fiscal 2024, we repurchased approximately 0.3 million shares of our non-voting common stock (CENTA) on the open market at an aggregate cost of approximately $10.7 million and approximately 3 thousand shares of our voting common stock (CENT) on the open market at an aggregate cost of approximately $109 thousand.
During fiscal 2024, we repurchased approximately 0.3 million shares of our non-voting common stock (CENTA) and approximately 3 thousand shares of our voting common stock (CENT) on the open market at an aggregate cost of approximately $10.8 million.
We expect that our principal sources of funds will be cash generated from our operations, proceeds from our debt and equity offerings, and, if necessary, borrowings under our $750 million asset backed loan facility. See Note 11 - Long-Term Debt , for more information about our debt.
We expect that our principal sources of funds will be cash generated from our operations, proceeds from our debt and equity offerings, and, if necessary, borrowings under our $600 million asset backed loan facility. See Note11 - Long-Term Debt , for more information about our debt.
Debt repayments do not reflect the unamortized portion of deferred financing costs associated with the 2028 Notes, 2030 Notes and 2031 Notes of approximately $10.3 million as of September 28, 2024, of which $1.6 million is amortizable until February 2028, $4.8 million is amortizable until October 2030 and $4.0 million is amortizable until April 2031, and is included in the carrying value of the long-term debt.
Debt repayments do not reflect the unamortized portion of deferred financing costs associated with the 2028 Notes, 2030 Notes and 2031 Notes of approximately $8.5 million as of September 27, 2025, of which $1.1 million is amortizable until February 2028, $4.0 million is amortizable until October 2030 and $3.4 million is amortizable until April 2031, and is included in the carrying value of the long-term debt.
In fiscal 2024, our consolidated net sales were $3.2 billion, of which our Pet segment, or Pet, accounted for approximately $1.8 billion and our Garden segment, or Garden, accounted for approximately $1.4 billion.
In fiscal 2025, our consolidated net sales were $3.1 billion, of which our Pet segment, or Pet, accounted for approximately $1.8 billion and our Garden segment, or Garden, accounted for approximately $1.3 billion.
We may redeem some or all of the 2028 Notes, at our option, at any time before December 31, 2024 for 101.708%, on or after January 1, 2025 for 100.854% and on or after January 1, 2026 for 100.0%, plus accrued and unpaid interest.
We may redeem some or all of the 2028 Notes at our option, through December 31, 2025 for 101.854% and on or after January 1, 2026 for 100.0%, plus accrued and unpaid interest.
We completed our qualitative assessment of potential goodwill impairment and determined that it was more likely than not the fair values of our reporting segments were greater than their carrying amount in fiscal year 2024, and accordingly, no further testing of goodwill was required in fiscal 2024. 31 In connection with our annual goodwill impairment testing performed during fiscal 2023, we elected to bypass the qualitative assessment and proceeded directly to performing the quantitative goodwill impairment test.
In connection with our annual goodwill impairment testing performed during fiscal 2023, we elected to bypass the qualitative assessment and proceeded directly to performing the quantitative goodwill impairment test. We completed our quantitative assessment of potential goodwill and determined that it was more likely than not the fair values of our reporting segments were greater than their carrying amounts.
Our expected revenues were based on our future operating plan and market growth or decline estimates for future years. We recognized impairment losses on certain intangible assets of $12.8 million and $11.5 million in fiscal years 2024 and 2023, respectively, and there were no impairment losses recorded in fiscal year 2022.
Our expected revenues were based on our future operating plan and market growth or decline estimates for future years. We recognized impairment losses on certain intangible assets of $1.0 million, $12.8 million and $11.5 million in fiscal 2025, 2024 and 2023, respectively.
The 2028 Notes contain customary high-yield covenants, including covenants limiting debt incurrence and restricted payments, subject to certain baskets and exceptions. We were in compliance with all financial covenants as of September 28, 2024. Asset-Based Loan Facility On December 16, 2021, we entered into a Third Amended and Restated Credit Agreement (“Credit Agreement”).
The 2028 Notes contain customary high-yield covenants, including covenants limiting debt incurrence and restricted payments, subject to certain baskets and exceptions. We were in compliance with all financial covenants as of September 27, 2025. Asset-Based Loan Facility On November 7, 2025, we entered into a Fourth Amended and Restated Credit Agreement (the “Credit Agreement”).
The 2028 Notes are unconditionally guaranteed on a senior basis by our existing and future domestic restricted subsidiaries who are borrowers under or guarantors of our Credit Facility.
The 2028 Notes require semiannual interest payments on February 1 and August 1. The 2028 Notes are unconditionally guaranteed on a senior basis by our existing and future domestic restricted subsidiaries who are borrowers under or guarantors of our Credit Facility.
Gain from litigation and investment impairment (8) Within corporate, the Company received $3.2 million during the fourth quarter of fiscal 2024 in settlement of litigation which gain is included in selling, general and administrative expense.
Gain from litigation and investment impairment (6) In fiscal 2024, within corporate, we received $3.2 million in settlement of litigation, the gain of which is included in selling, general and administrative expense.
The Credit Agreement provides for a $750 million principal amount senior secured asset-based revolving credit facility, with up to an additional $400 million principal amount available with the consent of the Lenders, as defined, if we exercise the uncommitted accordion feature set forth therein (collectively, the “Credit Facility”). The Credit Facility matures on December 16, 2026.
The Credit Agreement provides for a $600 million principal amount senior secured asset-based revolving credit facility, with up to an additional $400 million principal amount available, as defined, if we exercise the uncommitted accordion feature set forth therein (collectively, the “Credit Facility”). The Credit Facility matures on November 7, 2030.
Other income (expense) was an expense of $5.1 million in fiscal 2024 compared to income of $1.5 million in fiscal 2023, due primarily to a $7.5 million impairment in fiscal 2024 for two private company investments. Income Tax Our effective income tax rate was 23.2% for fiscal 2024 compared to 22.4% for fiscal 2023.
Other income (expense) was an expense of $0.5 million in fiscal 2025 compared to $5.1 million in fiscal 2024. The decrease in expense was due primarily to a $7.5 million non-cash impairment in fiscal 2024 for two private company investments. Income Tax Our effective income tax rate was 24.4% for fiscal 2025 compared to 23.2% for fiscal 2024.
As of September 28, 2024, we had $82 million remaining under our 2019 Repurchase Authorization. In February 2019, the Board of Directors authorized us to make supplemental purchases to minimize dilution resulting from issuances under our equity compensation plans (the "Equity Dilution Authorization").
As of September 27, 2025, the Company had $46.5 million remaining under its 2024 Repurchase Authorization. In February 2019, the Board of Directors authorized us to make supplemental purchases to minimize dilution resulting from issuances under our equity compensation plans (the "Equity Dilution Authorization").
On a non-GAAP basis, Pet operating income increased $7.3 million in fiscal 2024 as compared to fiscal 2023 and operating margin improved to 12.2% in fiscal 2024 from 11.5% in fiscal 2023.
On a non-GAAP basis, Pet operating income increased $1.9 million in fiscal 2025 as compared to fiscal 2024 and operating margin improved to 12.5% in fiscal 2025 from 12.2% in fiscal 2024.
On a non-GAAP basis, net income in fiscal 2024 was $142.4 million, or $2.13 per diluted share, compared to $138.5 million, or $2.07 per diluted share, for fiscal 2023.
On a non-GAAP basis, net income in fiscal 2025 was $174.2 million, or $2.73 per diluted share, compared to $142.4 million, or $2.13 per diluted share, for fiscal 2024.
The Credit Facility is subject to a borrowing base that is calculated using a formula based upon eligible receivables and inventory, and at our election, eligible real property, minus certain reserves. Proceeds of the Credit Facility may be used for general corporate purposes. Net availability under the Credit Facility was approximately $481 million as of September 28, 2024.
The Credit Facility is subject to a borrowing base that is calculated using a formula based upon eligible receivables and inventory, and at our election, eligible real property, minus certain reserves. Proceeds of the Credit Facility may be used for general corporate purposes.
As of November 21, 2024, we had $30.3 million remaining under our 2019 Repurchase Authorization. 18 Results of Operations (GAAP) The following table sets forth, for the periods indicated, the relative percentages that certain income and expense items bear to net sales: Fiscal Year Ended September 28, 2024 September 30, 2023 September 24, 2022 Net sales 100.0 % 100.0 % 100.0 % Cost of goods sold and occupancy 70.5 71.4 70.3 Gross profit 29.5 28.6 29.7 Selling, general and administrative 23.7 22.2 21.9 Operating income 5.8 6.4 7.8 Interest expense, net (1.2) (1.5) (1.7) Other expense, net (0.2) — (0.1) Income taxes 1.0 1.1 1.4 Net income 3.4 % 3.8 % 4.6 % Fiscal 2024 Compared to Fiscal 2023 Net Sales Net sales for fiscal 2024 decreased $109.6 million, or 3.3%, to $3,200.5 million from $3,310.1 million in fiscal 2023.
Results of Operations (GAAP) The following table sets forth, for the periods indicated, the relative percentages that certain income and expense items bear to net sales: Fiscal Year Ended September 27, 2025 September 28, 2024 September 30, 2023 Net sales 100.0 % 100.0 % 100.0 % Cost of goods sold and occupancy 68.1 70.5 71.4 Gross profit 31.9 29.5 28.6 Selling, general and administrative 23.9 23.7 22.2 Operating income 8.0 5.8 6.4 Interest expense, net (1.0) (1.2) (1.5) Other expense, net — (0.2) — Income taxes 1.7 1.0 1.1 Net income 5.2 % 3.4 % 3.8 % Fiscal 2025 Compared to Fiscal 2024 Net Sales Net sales for fiscal 2025 decreased $71.4 million, or 2.2%, to $3,129.1 million from $3,200.5 million in fiscal 2024.
Base Rate is defined as the highest of (a) the Truist prime rate, (b) the Federal Funds Rate plus 0.50%, (c) one-month SOFR plus 1.00% and (d) 0.00%.
Base Rate is defined as the highest of (a) the Truist prime rate, (b) the Federal Funds Rate plus 0.50%, (c) one-month SOFR plus 1.00% and (d) 0.00%. The applicable margin for SOFR-based borrowings fluctuates between1.00%-1.50% and the applicable margin for Base Rate borrowings fluctuates between 0.00%-0.50%.
Pet operating income increased $5.4 million, or 2.7%, to $203.4 million in fiscal 2024 from $198.0 million in fiscal 2023, due to an improved gross margin partially offset by lower net sales and increased selling, general and administrative expenses. Pet operating margin increased from 10.5% in fiscal 2023 to 11.1% in fiscal 2024.
Pet operating income increased $12.3 million, or 6.0%, to $215.7 million in fiscal 2025 from $203.4 million in fiscal 2024, due to an improved gross margin and decreased selling, general and administrative expenses partially offset by lower net sales. Pet operating margin increased from 11.1% in fiscal 2024 to 12.0% in fiscal 2025.
To encourage retailers and distributors to stock large quantities of inventory, industry practice has been for manufacturers to give extended credit terms and/or promotional discounts. Operating Activities Net cash provided by operating activities increased $13.3 million, from $381.6 million in fiscal 2023 to $394.9 million in fiscal 2024.
To encourage retailers and distributors to stock large quantities of inventory, industry practice has been for manufacturers to give extended credit terms and/or promotional discounts. Operating Activities Net cash provided by operating activities decreased $62.4 million, from $394.9 million in fiscal 2024 to $332.5 million in fiscal 2025.
Generally, during the first fiscal quarter, accounts receivable reach their lowest level while inventory, accounts payable and short-term borrowings begin to increase. During the second fiscal quarter, receivables, accounts payable and short-term borrowings increase, reflecting the build-up of inventory and related payables in anticipation of the peak lawn and garden selling season.
During the second fiscal quarter, accounts receivable, accounts payable and short-term borrowings increase, reflecting the build-up of inventory and related payables in anticipation of the peak lawn and garden selling season.
In August 2019, our Board of Directors authorized a share repurchase program to purchase up to $100 million of our common stock (the "2019 Repurchase Authorization"). The 2019 Repurchase Authorization has no fixed expiration date and expires when the amount authorized has been used or the Board withdraws its authorization.
In December 2024, our Board of Directors authorized a $100 million increase in the share repurchase program (the "2024 Repurchase Authorization"). The 2024 Repurchase Authorization has no fixed expiration date and expires when the amount authorized has been used or 25 the Board withdraws its authorization.
Selling, General and Administrative Selling, general and administrative expenses increased $22.1 million, or 3.0%, from $736.2 million in fiscal 2023 to $758.3 million in fiscal 2024. As a percentage of net sales, selling, general and administrative expenses increased from 22.2% in fiscal 2023 to 23.7% in fiscal 2024.
Selling, General and Administrative Selling, general and administrative expenses decreased $11.0 million, or 1.5%, from $758.3 million in fiscal 2024 to $747.3 million in fiscal 2025. As a percentage of net sales, selling, general and administrative expenses increased from 23.7% in fiscal 2024 to 23.9% in fiscal 2025.
The following table indicates each class of similar products which represented approximately 10% or more of our consolidated net sales in the fiscal years presented: Category 2024 2023 2022 (in millions) Other garden products $ 802.6 $ 832.2 $ 865.3 Other pet products 701.4 699.4 765.9 Other manufacturers' products 735.9 734.9 730.2 Dog & cat products 534.2 568.6 542.9 Wild bird 426.4 475.0 434.3 Total $ 3,200.5 $ 3,310.1 $ 3,338.6 Pet net sales decreased $44.4 million, or 2.4%, to $1,832.8 million in fiscal 2024 from $1,877.2 million in fiscal 2023.
The following table indicates each class of similar products which represented approximately 10% or more of our consolidated net sales in the fiscal years presented: Category 2025 2024 2023 (in millions) Other garden products $ 808.2 $ 832.9 $ 832.2 Other pet products 602.6 635.0 699.4 Other manufacturers' products 664.7 705.6 734.9 Dog & cat products 592.8 600.6 568.6 Wild bird 460.8 426.4 475.0 Total $ 3,129.1 $ 3,200.5 $ 3,310.1 Pet net sales decreased $30.8 million, or 1.7%, to $1,802.0 million in fiscal 2025 from $1,832.8 million in fiscal 2024.
We were in compliance with all financial covenants under the Credit Facility as of September 28, 2024. Summarized Financial Information for Guarantors and the Issuer of Guaranteed Securities Central (the "Parent/Issuer") issued $400 million of 2031 Notes in April 2021, $500 million of 2030 Notes in October 2020, and $300 million of 2028 Notes in December 2017.
Summarized Financial Information for Guarantors and the Issuer of Guaranteed Securities Central (the "Parent/Issuer") issued $400 million of 2031 Notes in April 2021, $500 million of 2030 Notes in October 2020, and $300 million of 2028 Notes in December 2017.
Net Income and Earnings Per Share Our net income for fiscal 2024 was $108.0 million, or $1.62 per diluted share, compared to $125.6 million, or $1.88 per diluted share, for fiscal 2023.
Net Income and Earnings Per Share Our net income for fiscal 2025 was $162.8 million, or $2.55 per diluted share, compared to $108.0 million, or $1.62 per diluted share, for fiscal 2024.
We incurred approximately $4.8 million of debt issuance costs in conjunction with this transaction, which included underwriter fees and legal, accounting and rating agency expenses. The debt issuance costs are being amortized over the term of the 2028 Notes. The 2028 Notes require semiannual interest payments on February 1 and August 1.
We incurred approximately $6 million of debt issuance costs in conjunction with this issuance, which included underwriter fees and legal, accounting and rating agency expenses. The debt issuance costs are being amortized over the term of the 2031 Notes. The 2031 Notes require semi-annual interest payments on April 30 and October 30.
The Credit Facility includes a $50 million sublimit for the issuance of commercial and standby letters of credit and a $75 million sublimit for Swing Loan borrowings. As of September 28, 2024, there were no borrowings outstanding and no letters of credit outstanding under the Credit Facility.
The Credit Facility includes a $50 million sublimit for the issuance of standby and commercial letters of credit and a $75 million sublimit for swing loan borrowings.
During fiscal 2023, we repurchased approximately 0.8 million shares of our non-voting common stock (CENTA) on the open market at an aggregate cost of approximately $22.9 million and approximately 0.3 million shares of our voting common stock (CENT) on the open market at an aggregate cost of approximately $8.7 million.
Stock Repurchases During fiscal 2025, we repurchased approximately 3.2 million shares of our non-voting common stock (CENTA) and approximately 1.4 million shares of our voting common stock (CENT) on the open market at an aggregate cost of approximately $148.4 million.
From time to time in the future, there may be other items that we may exclude if we believe that doing so is consistent with the goal of providing useful information to investors and management.
The tax impact of the non-GAAP adjustments is calculated based on the consolidated effective tax rate on a GAAP basis, applied to the non-GAAP adjustments. From time to time in the future, there may be other items that we may exclude if we believe that doing so is consistent with the goal of providing useful information to investors and management.
Other Income (Expense) Other income (expense) is comprised of income or loss from investments accounted for under the equity method of accounting and foreign currency exchange gains and losses.
Our average borrowing rate was 4.5% in both fiscal 2025 and fiscal 2024. Other Income (Expense) Other income (expense) is comprised of income or loss from investments accounted for under the equity method of accounting and foreign currency exchange gains and losses.
Sales of branded products represented approximately 78% of our net sales in both fiscal 2024 and fiscal 2023, and sales of other manufacturers' products represented 22% of our net sales.
In fiscal 2025, sales of branded products represented approximately 79% of our net sales, compared to 78% in fiscal 2024, and sales of other manufacturers' products represented 21% of our net sales.
In fiscal 2024, our operating income was $185 million, consisting of income from our Pet segment of $203 million, income from our Garden segment of $82 million and corporate expenses of $100 million. Fiscal 2024 Financial Highlights Financial summary: • Net sales for fiscal 2024 decreased $109.6 million, or 3.3%, to $3.2 billion.
In fiscal 2025, our operating income was $250 million, consisting of income from our Pet segment of $216 million, income from our Garden segment of $142 million and corporate expenses of $108 million. Fiscal 2025 Financial Highlights Financial summary: • Net sales for fiscal 2025 decreased $71.4 million, or 2.2%, to $3.1 billion.
(2) During the third quarter of fiscal 2024, we recognized incremental expense of $11.1 million in the consolidated statement of operations, from the decision to exit the pottery business, the closure of a live goods distribution facility in Delaware and the relocation of our grass seed research facility.
(3) During fiscal 2024, we recognized incremental expense of $20.3 million in our Garden segment in the consolidated statement of operations, from the closure of a manufacturing facility in California, the consolidation of our Southeast distribution network, the decision to exit the pottery business, the closure of a live goods distribution facility in Delaware, the relocation of our grass seed research facility related, and facility closures announced in fiscal 2023.
During the period September 29, 2024 through November 21, 2024, we repurchased 1.3 million shares of our non-voting common stock (CENTA) and 0.4 million shares of our voting common stock (CENT) on the open market at an aggregate cost of $51.7 million. As of November 21, 2024, we had $30.3 million remaining on under our 2019 Repurchase Authorization.
Fiscal 2025 Stock Repurchases During fiscal 2025, we repurchased 3.2 million shares of our non-voting common stock (CENTA) and 1.4 million shares of our voting common stock (CENT) on the open market at an aggregate cost of $148.4 million. As of September 27, 2025, we had $46.5 million remaining under our 2024 Repurchase Authorization.
We completed our quantitative assessment of potential goodwill and determined that it was more likely than not the fair values of our reporting segments were greater than their carrying amounts.
We completed our qualitative assessment of potential goodwill impairment and determined that it was more likely than not the fair values of our reporting segments were greater than their carrying amount in fiscal year 2024, and accordingly, no further testing of goodwill was required in fiscal year 2024.
The non-GAAP adjustments made reflect the following: Facility closures and business exits (1) During the fourth quarter of fiscal year 2024, we recognized incremental expense of $7.5 million in our Pet segment in the consolidated statement of operations, from the closure of manufacturing facilities in California and Arizona.
(4) During fiscal 2024, we recognized incremental expense of $7.5 million in our Pet segment in the consolidated statement of operations, from the closure of manufacturing facilities in California and Arizona.
In presenting the summarized financial statements, the equity method of accounting has been applied to the Parent/Issuer's interests in the Guarantor Subsidiaries.
In presenting the summarized financial statements, the equity method of accounting has been applied to the Parent/Issuer's interests in the Guarantor Subsidiaries. The summarized information excludes financial information of the Non-Guarantors, including earnings from and investments in these entities.
On a non-GAAP basis, operating income declined $4.4 million in fiscal 2024. • Net income for fiscal 2024 was $108.0 million, or $1.62 per share on a diluted basis compared to $125.6 million, or $1.88 per share on a diluted basis in fiscal 2023.
On a non-GAAP basis, operating income increased $42.2 million, or 19.0%, in fiscal 2025. • Net income for fiscal 2025 was $162.8 million, or $2.55 per share on a diluted basis compared to $108.0 million, or $1.62 per share on a diluted basis in fiscal 2024.
Liquidity and Capital Resources We have financed our growth through a combination of internally generated funds, bank borrowings, supplier credit, and sales of equity and debt securities to the public. Our business is seasonal and our working capital requirements and capital resources track closely to this seasonal pattern.
Substantially all of the Garden segment’s operating income is typically generated in this period. 24 Liquidity and Capital Resources We have financed our growth through a combination of internally generated funds, bank borrowings, supplier credit, and sales of equity and debt securities to the public.
The 2031 Notes were issued in a private placement under Rule 144A and will not be registered under the Securities Act of 1933. We may redeem some or all of the 2031 Notes at any time, at our option, prior to April 30, 2026, at the principal amount plus a "make whole" premium.
We may redeem some or all of the 2031 Notes at any time, at our option, prior to April 30, 2026, at the principal amount plus a "make whole" premium.
The debt issuance costs are being amortized over the term of the Credit Facility. The Credit Facility continues to contain customary covenants, including financial covenants which require us to maintain a minimum fixed charge coverage ratio of 1:1 upon triggered quarterly testing (e.g. when availability falls below certain thresholds established in the agreement), reporting requirements and events of default.
The Credit Facility contains customary covenants, including a financial covenant which requires us to maintain a minimum fixed charge coverage ratio of 1:1 when availability falls below certain thresholds established in the Credit Agreement, reporting requirements and events of default.
We were in compliance with all financial covenants as of September 28, 2024. $300 Million 5.125% Senior Notes due 2028 In December 2017, we issued $300 million aggregate principal amount of 5.125% senior notes due February 2028 (the "2028 Notes"). We used the net proceeds from the offering to finance acquisitions and for general corporate purposes.
We were in compliance with all financial covenants as of September 27, 2025. $300 Million 5.125% Senior Notes due 2028 In December 2017, we issued $300 million aggregate principal amount of 5.125% senior notes due February 2028 (the "2028 Notes").
On a non-GAAP basis, net income in fiscal 2024 was $142.4 million, or $2.13 per share on a diluted basis compared to $138.5 million, or $2.07 per share on a diluted basis in fiscal 2023.
On a non-GAAP basis, net income in fiscal 2025 was $174.2 million, or $2.73 per share on a diluted basis compared to $142.4 million, or $2.13 per share on a diluted basis in fiscal 2024. Recent Developments: Wind-down of U.K.
Organic net sales decreased 3.9% with Pet organic sales decreasing 5.9% and Garden organic sales decreasing 1.2%. • Gross profit for fiscal 2024 declined $3.1 million, or 0.3%, to $943.7 million while gross margin increased 90 basis points in fiscal 2024 to 29.5%, from 28.6% in fiscal 2023.
Pet net sales decreased $30.8 million, or 1.7%, and Garden net sales decreased $40.6 million, or 3.0%. • Gross profit for fiscal 2025 increased $53.6 million, or 5.7%, to $997.3 million and gross margin increased 240 basis points in fiscal 2025 to 31.9%, from 29.5% in fiscal 2024.
However, we cannot assure you that these sources will continue to provide us with sufficient liquidity and, should we require it, that we will be able to obtain financing on terms satisfactory to us, or at all. 26 We anticipate that our capital expenditures, which are related primarily to replacements and expansion of and upgrades to plant and equipment and also investment in our continued implementation of a scalable enterprise-wide information technology platform, will be approximately $70 million over the next 12 months.
We anticipate that our capital expenditures, which are related primarily to replacements and expansion of and upgrades to plant and equipment and also investment in our continued implementation of a scalable enterprise-wide information technology platform, will be approximately $50 to 60 million over the next 12 months.
Fiscal 2024 included 52 weeks while fiscal 2023 included 53 weeks. Our branded product sales, which include products we produce under Central brand names and products we produce under third-party brands, decreased $80.2 million, and sales of other manufacturers’ products decreased $29.4 million.
Our branded product sales, which include products we produce under Central brand names and products we produce under third-party brands, decreased $30.6 million, and sales of other manufacturers’ products decreased $40.8 million.
We used a portion of the net proceeds from the offering to repay all outstanding borrowings under our Amended Credit Facility, with the remainder used for general corporate purposes. We incurred approximately $6 million of debt issuance costs in conjunction with this issuance, which included underwriter fees and legal, accounting and rating agency expenses.
We used the net proceeds from the offering to finance acquisitions and for general corporate purposes. 26 We incurred approximately $4.8 million of debt issuance costs in conjunction with this transaction, which included underwriter fees and legal, accounting and rating agency expenses. The debt issuance costs are being amortized over the term of the 2028 Notes.
The increase in cash provided was due primarily to changes in our working capital accounts, due to increases in accounts payable and accrued expenses, partially offset by a lower amount of cash generated from the decrease in accounts receivable, as compared to the prior year.
The decrease in cash provided was due primarily to changes in our working capital accounts, due to decreases in inventory and accrued expenses, partially offset by cash provided by the long-term obligations in the current year as compared to cash used for other long-term obligations in the prior year.
The summarized information excludes financial information of the Non-Guarantors, including earnings from and investments in these entities. 29 Summarized Statements of Operations (in thousands) Fiscal Year Ended Fiscal Year Ended September 28, 2024 September 30, 2023 (in thousands) Parent/Issuer Guarantors Parent/Issuer Guarantors Net sales $ 694,083 $ 2,491,748 $ 768,207 $ 2,531,503 Gross profit 154,310 771,737 166,370 767,480 Income (loss) from operations (6,164) 189,406 (32,001) 244,164 Equity in earnings of Guarantor subsidiaries 163,797 — 191,793 — Net income (loss) (58,047) 163,797 (63,840) 191,793 Summarized Balance Sheet Information (in thousands) As of As of September 28, 2024 September 30, 2023 (in thousands) Parent/Issuer Guarantors Parent/Issuer Guarantors Current assets $ 936,497 $ 896,476 $ 661,660 $ 999,218 Intercompany receivable from Non-guarantor subsidiaries 76,084 — 69,404 — Other assets 3,799,521 3,330,344 3,402,000 2,762,797 Total assets $ 4,812,102 $ 4,226,820 $ 4,133,064 $ 3,762,015 Current liabilities $ 164,607 $ 342,289 $ 155,793 $ 294,686 Intercompany payable from Non-guarantor subsidiaries — 1,003 — 766 Long-term debt 1,189,655 154 1,187,771 186 Other liabilities 1,888,312 234,308 1,308,736 60,611 Total liabilities $ 3,242,574 $ 577,754 $ 2,652,300 $ 356,249 Contractual Obligations The table below presents our significant contractual cash obligations by fiscal year: Contractual Obligations Fiscal 2025 Fiscal 2026 Fiscal 2027 Fiscal 2028 Fiscal 2029 Thereafter Total (in millions) Long-term debt, including current maturities (1) $ 0.2 $ 0.1 $ 0.1 $ 0.1 $ — $ 1,200.0 $ 1,200.5 Interest payment obligations (2) 52.5 52.5 52.5 44.8 37.1 43.3 282.7 Operating leases 65.0 53.7 42.6 30.8 24.7 55.6 272.4 Purchase commitments (3) 102.1 14.5 8.5 6.0 2.1 2.4 135.6 Performance-based payments (4) — — — — — — — Total $ 219.8 $ 120.8 $ 103.7 $ 81.7 $ 63.9 $ 1,301.3 $ 1,891.2 (1) Excludes $3.0 million of outstanding letters of credit related to normal business transactions.
Summarized Statements of Operations Fiscal Year Ended September 27, 2025 September 28, 2024 Parent/Issuer Guarantors Parent/Issuer Guarantors (in thousands) Net sales $ 770,812 $ 2,348,267 $ 694,083 $ 2,491,748 Gross profit 181,997 808,803 154,310 771,737 Income (loss) from operations (5,724) 267,249 (6,164) 189,406 Equity in earnings of Guarantor subsidiaries 223,637 — 163,797 — Net income (loss) (45,373) 223,637 (58,047) 163,797 Summarized Balance Sheet Information As of As of September 27, 2025 September 28, 2024 Parent/Issuer Guarantors Parent/Issuer Guarantors (in thousands) Current assets $ 1,065,394 $ 881,526 $ 936,497 $ 896,476 Intercompany receivable from Non-guarantor subsidiaries 71,716 — 76,084 — Other assets 4,066,291 3,580,246 3,799,521 3,330,344 Total assets $ 5,203,401 $ 4,461,772 $ 4,812,102 $ 4,226,820 Current liabilities $ 165,447 $ 362,348 $ 164,607 $ 342,289 Intercompany payable from Non-guarantor subsidiaries — 1,250 — 1,003 Long-term debt 1,191,541 100 1,189,655 154 Other liabilities 2,235,827 217,213 1,888,312 234,308 Total liabilities $ 3,592,815 $ 580,911 $ 3,242,574 $ 577,754 28 Contractual Obligations The table below presents our significant contractual cash obligations by fiscal year: Contractual Obligations Fiscal 2026 Fiscal 2027 Fiscal 2028 Fiscal 2029 Fiscal 2030 Thereafter Total (in millions) Long-term debt, including current maturities (1) $ 0.1 $ 0.1 $ — $ — $ — $ 1,200.0 $ 1,200.2 Interest payment obligations (2) 52.5 52.5 44.8 37.1 26.8 16.5 230.2 Operating leases 67.2 56.1 44.3 37.9 32.5 56.7 294.7 Purchase commitments (3) 85.0 10.2 7.6 3.8 1.5 — 108.1 Performance-based payments (4) — — — — — — — Total $ 204.8 $ 118.9 $ 96.7 $ 78.8 $ 60.8 $ 1,273.2 $ 1,833.2 (1) Excludes $3.0 million of outstanding letters of credit related to normal business transactions.
On a non-GAAP basis, gross margin increased 110 basis points in fiscal 2024. • Our operating income declined $25.3 million, or 12.0%, to $185.4 million in fiscal 2024.
On a non-GAAP basis, gross margin increased 210 basis points in fiscal 2025. • Our operating income increased $64.7 million, or 34.9%, to $250.0 million in fiscal 2025.
The decrease in Garden was due primarily to an approximately $19 million write-down of the value of our grass seed inventory due to a recent significant decrease in the market prices of grass seed and what we believe to be an industry-wide over supply of grass seed and lower sell through in our Live Goods business.
The increase in gross profit and gross margin in Garden was due primarily to improvements in our Live Goods business in fiscal 2025, from cost reduction initiatives under our Cost and Simplicity agenda and the adverse impact in fiscal 2024 from the write-down of the value of our grass seed inventory in fiscal 2024 of approximately $20 million, due to a significant decrease in the market prices of grass seed and an industry-wide over supply of grass seed.
The increase in cash used in investing activities was due primarily to our acquisition of TDBBS, LLC. Net cash used in investing activities decreased $108.4 million from $143.0 million in fiscal 2022 to $34.6 million in fiscal 2023.
Investing Activities Net cash used in investing activities decreased $60.3 million from $105.2 million in fiscal 2024 to $44.9 million in fiscal 2025. The decrease in cash used in investing activities was due primarily to our acquisition of TDBBS, LLC in fiscal 2024.
The decrease in net interest expense was due to increased interest income due primarily to higher cash balances during fiscal 2024. Debt outstanding on September 28, 2024 was $1,190.0 million compared to $1,188.2 million as of September 30, 2023. Our average borrowing rate was 4.5% in both fiscal 2024 and fiscal 2023.
Net Interest Expense Net interest expense decreased $5.1 million, or 13.4%, from $37.9 million in fiscal 2024 to $32.8 million in fiscal 2025. The decrease in net interest expense was due to increased interest income resulting from higher cash balances during fiscal 2025. Debt outstanding on September 27, 2025 and September 28, 2024 was $1.2 billion.
The decrease in cash used in financing activities during the current year was due primarily to lower stock repurchase activity in fiscal 2024 compared to fiscal 2023. Net cash used in financing activities decreased $29.2 million from $66.8 million of cash used in fiscal 2022 to $37.6 million of cash used in fiscal 2023.
Financing Activities Net cash used in financing activities increased $131.2 million from $25.4 million in fiscal 2024 to $156.6 million in fiscal 2025. The increase in cash used in financing activities during the current year was due primarily to higher stock repurchases in fiscal 2025 compared to fiscal 2024.
Both segments were adversely impacted by fiscal 2024 facility closure projects under our Cost and Simplicity initiative. On a non-GAAP basis, excluding the charges associated with the facility closures in fiscal 2024, gross profit increased $3.5 million and gross margin improved 110 basis points to 30.0% in fiscal 2024.
On a non-GAAP basis, excluding approximately $6 million in charges associated with the facility closures in fiscal 2025 and approximately $16 million in fiscal 2024, gross profit increased $42.8 million and gross margin improved 210 basis points to 32.1% in fiscal 2025 from 30.0% in fiscal 2024.
These declines were partially offset by increased sales in our animal health business. Pet branded sales decreased $45.4 million, and sales of other manufacturers' products increased $1.0 million. Garden net sales decreased $65.2 million, or 4.5%, to $1,367.7 million in fiscal 2024 from $1,432.9 million in fiscal 2023.
The decline in Pet net sales was due primarily to lower sales of durable items impacting our outdoor cushions, pet beds and aquatics businesses. These declines were partially offset by increased sales in our animal health business. Pet branded sales decreased $36.0 million, and sales of other manufacturers' products increased $5.2 million.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

4 edited+0 added−0 removed3 unchanged
Biggest changeAs of September 28, 2024, we had entered into fixed purchase commitments for commodities totaling approximately $135.6 million. A 10% change in the market price for these commodities would have resulted in an additional pretax gain or loss of $13.6 million as the related inventory containing those inputs is sold. Foreign Currency Risks.
Biggest changeAs of September 27, 2025, we had entered into fixed purchase commitments for commodities totaling approximately $108.1 million. A 10% change in the market price for these commodities would have resulted in an additional pretax gain or loss of $10.8 million as the related inventory containing those inputs is sold. Foreign Currency Risks.
Therefore, we have only minimal exposure to foreign currency exchange risk. We do not hedge against foreign currency risks and believe that foreign currency exchange risk is immaterial to our current business. 33 Item 8. Financial Statements and Supplementary Data See pages beginning at F-1. Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure None.
Therefore, we have only minimal exposure to foreign currency exchange risk. We do not hedge against foreign currency risks and believe that foreign currency exchange risk is immaterial to our current business. 31 Item 8. Financial Statements and Supplementary Data See pages beginning at F-1. Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure None.
Item 7A. Quantitative and Qualitative Disclosure About Market Risk We are exposed to market risks, which include changes in U.S. interest rates and commodity prices and, to a lesser extent, foreign exchange rates. We do not engage in financial transactions for trading or speculative purposes. 32 Interest Rate Risk .
Item 7A. Quantitative and Qualitative Disclosure About Market Risk We are exposed to market risks, which include changes in U.S. interest rates and commodity prices and, to a lesser extent, foreign exchange rates. We do not engage in financial transactions for trading or speculative purposes. 30 Interest Rate Risk .
The interest payable on our Amended Credit Facility is based on variable interest rates and therefore affected by changes in market interest rates. We had no variable rate debt outstanding as of September 28, 2024 under our Credit Facility.
The interest payable on our Amended Credit Facility is based on variable interest rates and therefore affected by changes in market interest rates. We had no variable rate debt outstanding as of September 27, 2025 under our Credit Facility.

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