What changed in Freshpet, Inc.'s 2023 10-K compared to 2022?

Across the narrative sections we track, Freshpet, Inc. (FRPT) added 173 paragraphs, removed 215, and edited 153 between the 2022 and 2023 10-K filings. The biggest movers are Item 7. Management's Discussion & Analysis (+80/−107), Item 1. Business (+40/−47), Item 1A. Risk Factors (+34/−42).

Did Freshpet, Inc. add new Risk Factors in the 2023 10-K?

Yes — Item 1A Risk Factors shows 34 new/edited paragraphs and 42 removed paragraphs versus the 2022 10-K.

What changed in Freshpet, Inc.'s MD&A (Item 7) in 2023?

Item 7 Management's Discussion & Analysis shows 80 new/edited paragraphs and 107 removed paragraphs year-over-year. Read the side-by-side diff to see exactly which revenue, margin, and outlook commentary was rewritten.

Did Freshpet, Inc.'s Legal Proceedings (Item 3) change in 2023?

Item 3 shows 3 added/edited paragraphs and 2 removed paragraphs — usually indicating new litigation disclosed or settled cases removed.

Where does this FRPT 10-K diff come from?

The source filings are Freshpet, Inc.'s official 2022 and 2023 Form 10-K annual reports from SEC EDGAR. 10q10k.net parses each filing, aligns paragraphs by section (Item 1, 1A, 1C, 2, 3, 7, 7A), and highlights every added, removed and edited sentence side-by-side.

What changed in Freshpet, Inc.'s 10-K — 2022 vs 2023

Paragraph-level year-over-year comparison of Freshpet, Inc.'s 2022 and 2023 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 2023 report.

+173 added−215 removedSource: 10-K (2024-02-26) vs 10-K (2023-02-28)

Top changes in Freshpet, Inc.'s 2023 10-K

173 paragraphs added · 215 removed · 153 edited across 7 sections

Item 7. Management's Discussion & Analysis+80 / −107 · 71 edited
Item 1. Business+40 / −47 · 36 edited
Item 1A. Risk Factors+34 / −42 · 31 edited
Item 7A. Quantitative and Qualitative Disclosures About Market Risk+9 / −9 · 8 edited
Item 5. Market for Registrant's Common Equity+4 / −6 · 3 edited

Item 1. Business

Business — how the company describes what it does

36 edited+4 added−11 removed40 unchanged

2022 filing

2023 filing

Biggest changeOur proprietary recipes include real, fresh meat and varying combinations of vitamin-rich vegetables, leafy greens and antioxidant rich fruits, without the use of preservatives, additives or artificial ingredients. Our unique product attributes appeal to diverse consumer needs across multiple classes of retail where Freshpet is sold. Consequently, our brand resonates across a broad cross-section of pet parent demographics.

Biggest changeOur portfolio of products consists of dog food, cat food, and dog treats. All Freshpet products are made according to our nutritional philosophy of fresh, nutritional ingredients and minimal processing. Our proprietary recipes include real, fresh meat and varying combinations of vitamin-rich vegetables, leafy greens and antioxidant rich fruits, without the use of preservatives or additives.

We also rely on unpatented proprietary expertise, recipes and formulations, continuing innovation and other trade secrets to develop and maintain our competitive position. 11 Government Regulation Along with our brokers, distributors, and ingredients and packaging suppliers, we are subject to extensive laws and regulations in the United States by federal, state and local government authorities.

We also rely on unpatented proprietary expertise, recipes and formulations, continuing innovation and other trade secrets to develop and maintain our competitive position. Government Regulation Along with our brokers, distributors, and ingredients and packaging suppliers, we are subject to extensive laws and regulations in the United States by federal, state and local government authorities.

Our Freshpet-owned manufacturing lines allows us to exercise significant control over production. We have a highly skilled Quality Assurance team consisting of quality assurance supervisors, specialists, analysts and quality technicians with significant experience in pet and human food production.

Our Freshpet-owned manufacturing lines allows us to exercise significant control over production. We have a highly skilled Food Safety and Quality Assurance team consisting of quality assurance supervisors, specialists, analysts, and quality technicians with significant experience in pet and human food production.

Hundreds of customer testimonials each year underscore Freshpet's support of a long and healthy life. Further, since founding Freshpet, we have donated over fourteen million fresh meals to pets via shelters, charitable organizations, and humane societies, including St Hubert's Animal Welfare Center, Pennsylvania SPCA and 4 Paws for Ability. People People include our team members, pet parents, and our partners.

Hundreds of customer testimonials each year underscore Freshpet's support of a long and healthy life. Further, since founding Freshpet, we have donated over seventeen million fresh meals to pets via shelters, charitable organizations, and humane societies, including St Hubert's Animal Welfare Center, Pennsylvania SPCA and 4 Paws for Ability. People People include our team members, pet parents, and our partners.

We reach consumers across multiple digital and social media platforms including websites, blogs and online reviews, as well as with tailored messaging on popular digital hubs including Instagram, Facebook, Twitter, TikTok and YouTube. Our marketing strategy has allowed us to drive new consumers to our brand and develop a highly engaged community of users who actively advocate for Freshpet.

We reach consumers across multiple digital and social media platforms including websites, blogs and online reviews, as well as with tailored messaging on popular digital hubs including Instagram, Facebook, X, TikTok and YouTube. Our marketing strategy has allowed us to drive new consumers to our brand and develop a highly engaged community of users who actively advocate for Freshpet.

Our Opportunity Even though long-term consumer trends of pet humanization and health and wellness are well documented, conventional pet food sold as dry kibble or wet food in cans has not changed substantially for decades. We believe that the pet food industry has not kept pace with how consumers think about food for their families, including their pets.

Even though long-term consumer trends of pet humanization and health and wellness are well documented, conventional pet food sold as dry kibble or wet food in cans has not changed substantially for decades. We believe that the pet food industry has not kept pace with how consumers think about food for their families, including their pets.

According to an American Pet Products Association's Pulse Study, 72% of pet parents feel they are closer/more bonded with their pet due to the COVID-19 pandemic. We believe that pet owners' closer bond to their pets aligns with recent trends, which the COVID-19 pandemic has further accelerated. Increasing consumer focus on health & wellness.

According to an American Pet Products Association's Pulse Study, 48% of pet parents feel they are closer/more bonded with their pet due to the COVID-19 pandemic. We believe that pet owners' closer bond to their pets aligns with recent trends, which the COVID-19 pandemic has further accelerated. Increasing consumer focus on health & wellness.

We position our brand to benefit from mainstream trends of growing pet humanization and consumer focus on health and wellness. We price our products to be accessible to the average consumer, providing us with broad demographic appeal and allowing us to penetrate multiple classes of retail, including grocery (including online), mass, club, pet specialty and natural.

As volume grows we expect to leverage our distribution network to continuously improve customer service levels and decrease certain distribution costs. For certain retailers, we use national and regional distributors. 7 Our Product Quality and Safety We go to great lengths to ensure product quality, consistency and safety from ingredient sourcing to finished product.

As volume grows, we will continue to leverage our distribution network to continuously improve customer service levels and decrease certain distribution costs. For certain retailers, we use national and regional distributors. 7 Our Product Quality and Safety We go to great lengths to ensure product quality, consistency and safety from ingredient sourcing to finished product.

We treat our team members with respect and are committed to helping them develop professionally and personally. These efforts have contributed to an employee net promoter score of 80.0%. Additionally, we strive to be good partners with customers, distributors, and suppliers by conducting business with honesty and transparency knowing that we cannot grow without their support.

We treat our team members with respect and are committed to helping them develop professionally and personally. These efforts have contributed to an employee net promoter score of 8.2. Additionally, we strive to be good partners with customers, distributors, and suppliers by conducting business with honesty and transparency knowing that we cannot grow without their support.

We deploy a broad set of marketing tools across television, digital and public relations to reach consumers through multiple touch points and increase product trials. Our network of fridges at approximately 25,281 retail locations within blue-chip retailers helps to introduce consumers to our brand and instantly distinguish Freshpet from traditionally merchandised pet food.

We deploy a broad set of marketing tools across television, digital and public relations to reach consumers through multiple touch points and increase product trials. Our network of fridges at approximately 26,777 retail locations within blue-chip retailers helps to introduce consumers to our brand and instantly distinguish Freshpet from traditionally merchandised pet food.

Our total chiller fleet at retailers covers over one million cubic feet of space. 9 Marketing and Advertising Our marketing strategy is designed to educate consumers about the benefits of fresh refrigerated pet food and build awareness of the Freshpet brand.

Our total chiller fleet at retailers covers over 1.7 million cubic feet of space. 9 Marketing and Advertising Our marketing strategy is designed to educate consumers about the benefits of fresh refrigerated pet food and build awareness of the Freshpet brand.

Our Customers and Distributors We sell our products throughout the United States, Canada, and Europe, generating the vast majority of our sales in the United States.

Our Customers and Distributors We sell our products throughout the United States, Canada, and Europe, and generate the vast majority of our sales in the United States.

In 2022, our largest distributor by net sales, Animal Supply Co., accounted for 8.0% of our net sales and our largest customer, Walmart, accounted for 21.4% of our net sales. 8 The Freshpet Fridge We sell our products through a growing network of company-owned branded refrigerators, the Freshpet Fridges.

In 2023, our largest distributor by net sales, Animal Supply Co., accounted for 9.0% of our net sales and our largest customer, Walmart, accounted for 23.4% of our net sales. 8 The Freshpet Fridge We sell our products through a growing network of company-owned branded refrigerators, the Freshpet Fridges.

In order to incentivize and engage our workforce, Freshpet provides: ● Industry-leading compensation, including stock compensation for every employee ● Industry-leading healthcare offered equitably for every employee ● Multi-year equity grants to "One-of-a-Kind Talent" employees identified by the Board ● Competitive perquisites, including pet insurance, tuition reimbursement, paid parental leave, free healthy snack room and catered lunches ● 401(k) matching for every employee ● Rigorous focus on Diversity & Inclusion to create an inclusive culture to attract, engage and retain our diverse talent As of December 31, 2022, we had 1,011 employees located primarily in Bethlehem PA, Ennis TX, Secaucus NJ and Europe.

In order to incentivize and engage our workforce, Freshpet provides: ● Industry-leading compensation, including stock compensation for every employee ● Industry-leading healthcare offered equitably for every employee ● Annual equity grants and Key Talent awards to employees identified by the Executive Leadership team and the Board ● Competitive perquisites, including pet insurance, tuition reimbursement, paid parental leave, free healthy snack room and catered lunches ● 401(k) matching for every employee ● Rigorous focus on Diversity & Inclusion to create an inclusive culture to attract, engage and retain our diverse talent As of December 31, 2023, we had 1,083 employees located primarily in Bethlehem, PA, Ennis, TX, Secaucus, NJ and Europe.

ITEM 1. BUSINESS Overview Freshpet, Inc. (“Freshpet,” the “Company,” "we" or "our") is disrupting the over $38.4 billion North American pet food industry by driving consumers to reassess conventional dog and cat food offerings that have remained essentially unchanged for decades.

ITEM 1. BUSINESS Overview Freshpet, Inc. (“Freshpet,” the “Company,” "we" or "our") is disrupting the over $52.0 billion United States pet food industry by driving consumers to reassess conventional dog and cat food offerings that have remained essentially unchanged for decades.

As of December 31, 2022, our household penetration within North America was approximately 4.9 million, with a target of 11 million households by 2025. Additionally, we believe that there are opportunities to expand our network into international markets as demonstrated with our recent initiatives in the U.K. market.

As of December 31, 2023, our household penetration within the U.S. was approximately 11.5 million, with a target of 20 million households by 2027. Additionally, we believe that there are opportunities to expand our network into international markets as demonstrated by our recent initiatives in the U.K. market.

As pets are increasingly viewed as companions, friends and family members, pet owners are being transformed into “pet parents” who spare no expense for their loved ones, driving premiumization across pet categories. This trend is reflected in food purchasing decisions.

According to Packaged Facts, 92-96% of U.S. pet owners view their pets as members of the family. As pets are increasingly viewed as companions, friends and family members, pet owners are being transformed into “pet parents” who spare no expense for their loved ones, driving premiumization across pet categories. This trend is reflected in food purchasing decisions.

We support renewable energy by matching the electricity used in Freshpet Kitchens Bethlehem and our refrigerators in over 25,000 retail locations with Green-E Certified renewable energy certificates from North American based projects. Freshpet's chiller fleet efficiency continues to improve with our latest units being up to 8.5x more efficient than older units.

We support renewable energy by matching the electricity used in Freshpet Kitchens and offices as well as our refrigerators in over 26,000 retail locations with Green-E Certified renewable energy certificates from North American based projects. Freshpet's chiller fleet efficiency continues to improve with our latest units using 91% less electricity than older units.

Our principal executive offices are located at 400 Plaza Drive, 1st Floor, Secaucus, New Jersey 07094. Website Information The address of our corporate website is www.freshpet.com. Our annual reports, annual proxy statements and related proxy cards are made available on our website at the same time they are mailed to stockholders, as required by applicable law.

Website Information The address of our corporate website is www.freshpet.com. Our annual reports, annual proxy statements and related proxy cards are made available on our website at the same time they are mailed to stockholders, as required by applicable law.

Our original Freshpet Kitchens Bethlehem is a 240,000 square foot facility, built to United States Department of Agriculture standards and currently houses six production lines customized to produce fresh, refrigerated food.

Our original Freshpet Kitchens Bethlehem, located in Bethlehem, Pennsylvania, is a 240,000 square foot facility, built to United States Department of Agriculture standards and currently houses six production lines customized to produce fresh, refrigerated food. In 2020, we began making investments at a manufacturing facility called Freshpet Kitchens South.

Our commitment to our values helps us engage with consumers, motivate our team members and attract strong partners, which allows us to fulfill our mission of delivering the best nutritional product choices to improve the well-being of our pets, enrich pet parents’ lives and contribute to communities.

Our commitment to our values helps us engage with consumers, motivate our team members, and attract strong partners, which allows us to fulfill our mission of delivering the best nutritional product choices to improve the well-being of our pets, enrich pet parents’ lives, and contribute to communities. 5 Our Products Freshpet's business operates in a single segment: the manufacturing, marketing and distribution of pet food and pet treats for dogs and cats.

None of our employees are represented by a labor union or by any collective bargaining arrangements with respect to his or her employment with us. We believe that our employee relations are good. 10 Our Corporate Information We were incorporated in Delaware in November 2004 and currently exist as a Delaware corporation.

None of our employees are represented by a labor union or by any collective bargaining arrangements with respect to his or her employment with us. 10 Our Corporate Information We were incorporated in Delaware in November 2004 and currently exist as a Delaware corporation. Our principal executive offices are located at 400 Plaza Drive, 1st Floor, Secaucus, New Jersey 07094.

We are committed to reducing as much of our carbon emissions as possible and use offsets to mitigate residual emissions. In 2022 we opened our state-of-the-art Kitchens in Ennis, TX. This facility will be our most sustainable yet with on-site solar power and battery micro-grid, wastewater recycling, and our most advanced heating / cooling technology.

In 2022 we opened our state-of-the-art Kitchens in Ennis, TX. This facility has been designed to be our most sustainable yet, incorporating on-site solar power and battery micro-grid, wastewater recycling, and advanced heating / cooling technology.

Our Innovation Center, which is part of our Freshpet Kitchens, helps us ensure that we remain capable of strong innovation including creating new product platforms to expand the breadth of our fresh pet food offerings. We expect that new product introductions and the introduction of new cooking techniques will continue to delight our consumers and drive growth going forward.

Our Innovation Center, which is part of our Freshpet Kitchens (collectively, our Freshpet Kitchens Bethlehem, Freshpet Kitchens South and Freshpet Kitchens Ennis), helps us ensure that we remain capable of strong innovation, including creating new product platforms to expand the breadth of our fresh pet food offerings.

Our Supply Chain Manufacturing: All of our products are manufactured in the United States. We own and operate what we believe to be the first fresh, refrigerated pet food manufacturing network in North America.

We expect that new product innovation and the introduction of new cooking techniques will continue to delight our consumers and drive growth going forward. Our Supply Chain Manufacturing: All of our products are manufactured in the United States. We own and operate what we believe to be the first fresh, refrigerated pet food manufacturing network in North America.

Competition Pet food is a highly competitive industry. We compete with manufacturers of conventional pet food such as Mars, Nestlé and Big Heart Pet Brands (part of The J.M. Smucker Company). We also compete with specialty and natural pet food manufacturers such as Colgate-Palmolive and General Mills.

Competition Pet food is a highly competitive industry. We compete with some of the largest pet food manufacturers such as Nestlé Purina Pet Care, the J.M. Smucker Company, Hill's Pet Nutrition, Mars Pet Care, General Mills Pet, and Post Consumer Brands.

For every ingredient, we either use multiple suppliers or have identified alternative sources of supply that meet our quality and safety standards. Distribution: Outbound transportation from our facility is handled through a third-party refrigerated freight broker.

All of our suppliers are well-established companies that have the scale to support our growth. For every ingredient, we either use multiple suppliers or have identified alternative sources of supply that meet our quality and safety standards. Distribution: Outbound transportation from our distribution center ("DC") facilities is managed by third-party refrigerated freight brokers.

Our products are sold under the Freshpet brand name, with ingredients, packaging and labeling customized by different classes of trade and are available in multiple forms.

Our unique product attributes appeal to diverse consumer needs across multiple classes of retail where Freshpet is sold. Consequently, our brand resonates across a broad cross-section of pet parent demographics. Our products are sold under the Freshpet brand name, with ingredients, packaging, and labeling customized by different classes of trade and are available in multiple forms.

The pet food market has historically been resilient as consumers continue to spend on their pets even during economic downturns. We believe the following trends are driving growth in our industry: Pet ownership.

Our Industry We primarily compete in the United States dog and cat food market. We believe pet food spending in North America will continue to increase at a similar rate as it has in the past. The pet food market has historically been resilient as consumers continue to spend on their pets even during economic downturns.

The project is being developed in three phases with subsequent expansion planned for the next several years. Due to the continued growth of the Company’s fresh pet food sales, the Company has plans to continue expanding its manufacturing capacity via operational efficiency improvements at our current facilities and via future expansion of our physical features.

Due to the continued growth of our fresh pet food sales, we plan to continue expanding our manufacturing capacity via operational efficiency improvements at our current facilities and via future expansion of our physical features. In 2023, approximately 99.1% of our product volume was manufactured with Freshpet owned equipment.

There are currently approximately 90.5 million pet owning households in the United States, which represents approximately 70% of total households, and over 114.3 million dogs and cats in the United States, according to the American Pet Products Association. Pet humanization . According to Packaged Facts, 92%-96% of U.S. pet owners view their pets as members of the family.

We believe the following trends are driving growth in our industry: Pet ownership. There are currently approximately 86.9 million pet owning households in the United States, which represents approximately 66% of total households, and over 111.6 million dogs and cats in the United States, according to the American Pet Products Association. Pet humanization .

The construction of Freshpet Kitchens Ennis, located in Ennis, Texas, began in 2020, with the first production line having been commissioned in Q4 of 2022, and two more lines to be commissioned over the next 18 months from the first phase of the project.

Freshpet Kitchens South currently has three production lines with the space for additional production lines in the future. The construction of Freshpet Kitchens Ennis, located in Ennis, Texas, began in 2020. The first production line was commissioned in Q4 of 2022, and two more lines were successfully commissioned in 2023, completing 1 of 3 construction phases for the site.

In 2022, approximately 98.8% of our product volume was manufactured with Freshpet owned equipment. Ingredients and Packaging: Our products are made with natural and fresh ingredients including meat, vegetables, fruits, whole grains, vitamins and minerals. Over 50% of our raw ingredients are sourced from suppliers located within 300 miles of our Freshpet Kitchens, and 96% are from North America.

Ingredients and Packaging: Our products are made with natural and fresh ingredients including meat, vegetables, fruits, whole grains, vitamins and minerals. We believe in building long-term supplier and farmer partnerships to source healthy and sustainable ingredients. We strive to source raw ingredients within a 300-mile radius of the Freshpet Kitchens.

We are in approximately 25,281 stores and believe there is opportunity for us to install a Freshpet Fridge in at least 30,000 stores in North America. We sell our products through the following classes of retail: grocery (including online), mass, club, pet specialty and natural.

As of December 31, 2023, we are in approximately 26,777 stores, with approximately 22% of stores having second and third Freshpet Fridge placements. We sell our products through the following classes of retail: grocery, mass, club, pet specialty, natural, and digital. Our customers determine whether they wish to purchase our products directly from us or through a third-party distributor.

We monitor changes in these laws and believe that we are in material compliance with applicable laws. Information Systems We transitioned to a new ERP system during the three months ended March 31, 2022. Implementation, integration and transition efforts continued thereafter and remain ongoing.

We monitor changes in these laws and believe that we are in material compliance with applicable laws. 11

Removed

Our Industry We primarily compete in the North American dog and cat food market, which we estimate will grow at an average compounded annual growth rate of 5.7% from 2022 to 2027. We believe pet food spending in North America will continue to increase at a similar rate during this same time period.

Added

Our Opportunity Freshpet has a unique opportunity to capture market share in this large and growing category by mainstreaming fresh food for pets and making fresh food a greater part of dogs' and cats' main meals.

Removed

In 2020, Nature's Fresh became Freshpet's first, and one of the industry's only, carbon neutral brand for Scope 1, 2, and 3 emissions. For 2021, we went even further and made Freshpet's entire business carbon neutral for Scope 1 and 2 emissions.

Added

These efforts are intended to help achieve our environmental goals while reducing the costs of doing business. 2023 saw the introduction of our new Texas distribution center and freight bracket pricing program. These efforts helped minimize the fuel used to ship Freshpet products to our customers resulting in significantly reduced logistics costs and environmental footprints.

Removed

These efforts are intended to help achieve our environmental goals, building and preserving a healthy planet for generations to come.

Added

Phase 2 is expected to commence production on its first line at the end of Q3 of 2024, with the balance of Phase 2 and Phase 3 to be completed over the next several years.

Removed

Freshpet—Pets, People, Planet. 5 Our Products Freshpet's business operates in a single segment: the manufacturing, marketing and distribution of pet food and pet treats for dogs and cats. Our products consist of dog food, cat food and dog treats. All Freshpet products are made according to our nutritional philosophy of fresh, meat-based nutrition and minimal processing.

Added

The service areas for our Pennsylvania and Texas DC locations are in a continual progression towards growing distribution out of Texas to serve the central and western US in tandem with the scale up of the Ennis Kitchen; and the Pennsylvania DC will principally service the eastern US and our international businesses.

Removed

In 2020 we began making investments at a manufacturing facility titled "Freshpet Kitchens South." Freshpet Kitchens South currently has three production lines with the space for additional production lines in the future.

Removed

We maintain rigorous standards for ingredient quality and safety. By volume, our single largest input is fresh chicken. In order to retain operating flexibility and negotiating leverage, we do not enter into exclusivity agreements or long-term commitments with any of our suppliers. All of our suppliers are well-established companies that have the scale to support our growth.

Removed

During 2022 we began to leverage a second third-party distribution center in Texas with the expectation that the Texas facility will service the western section of the country and the Pennsylvania distribution center will service the eastern section of the country.

Removed

Our customers determine whether they wish to purchase our products either directly from us or through a third-party distributor.

Removed

Accordingly, we have modified certain existing internal control processes relating to the implementation of the new ERP system.

Removed

Other than the implementation of the new ERP system, there were no changes in our internal control over financial reporting identified in management's evaluation pursuant to Rules 13a-15(d) and 15d-15(d) of the Exchange Act during the three months ended December 31, 2022, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Removed

This system governs order entry, customer service, accounts payable, accounts receivable, purchasing, asset management, manufacturing and warehouse management. Our order management process is automated via Electronic Data Interchange with virtually all our customers, which feeds information directly to our ERP platform. 12

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

31 edited+3 added−11 removed154 unchanged

2022 filing

2023 filing

Biggest changeFor example, we have had legal claims brought against us in California for our use of the word “natural” in describing certain of our products. We may also voluntarily recall or withdraw products that we consider below our standards, whether for taste, appearance or otherwise, in order to protect our brand reputation.

Biggest changeWe may also voluntarily recall or withdraw products that we consider below our standards, whether for taste, appearance or otherwise, in order to protect our brand reputation. Consumer or customer concerns (whether justified or not) regarding the quality or safety of our products could adversely affect our business.

Our ability to increase awareness, consumer trial and adoption of our products, and to implement this growth strategy depends, among other things, on our ability to: ● implement our marketing strategy; ● expand and maintain brand loyalty; ● partner with customers to secure space for our Freshpet Fridges; ● develop new product lines and extensions; ● partner with distributors to deliver our products to customers; ● continue to compete effectively in multiple classes of retail, including grocery (including online), mass, club, pet specialty and natural; and ● build capacity to meet demands, including the timely expansion of certain of our Freshpet Kitchens.

Our ability to increase awareness, consumer trial and adoption of our products, and to implement this growth strategy depends, among other things, on our ability to: ● implement our marketing strategy; ● expand and maintain brand loyalty; ● partner with customers to secure space for our Freshpet Fridges; ● develop new product lines and extensions; ● partner with distributors to deliver our products to customers; ● continue to compete effectively in multiple classes of retail, including grocery, mass, club, pet specialty, natural, and digital; and ● build capacity to meet demands, including the timely expansion of certain of our Freshpet Kitchens.

Any compromise or breach of our security could result in a violation of applicable privacy and other laws, including federal and state law, as well as the General Data Protection Regulation ("GDPR"), which could result in significant legal and financial exposure, and a loss of confidence in our security measures, which could have an adverse effect on our business, financial condition and results of operations. 22 Risks Related to our NOLs We may be unable to use some or all of our net operating loss carryforwards, which could adversely affect our financial results.

Any compromise or breach of our security could result in a violation of applicable privacy and other laws, including federal and state law, as well as the General Data Protection Regulation ("GDPR"), which could result in significant legal and financial exposure, and a loss of confidence in our security measures, which could have an adverse effect on our business, financial condition and results of operations. 21 Risks Related to our NOLs We may be unable to use some or all of our net operating loss carryforwards, which could adversely affect our financial results.

Whether or not a false marketing claim is successful, such assertions could have an adverse effect on our business, financial condition and results of operations, and the negative publicity surrounding them could harm our reputation and brand image. 16 Risks Related to our Manufacturing and Supply Chain We may not be able to successfully implement initiatives to improve productivity and streamline operations to control or reduce costs.

Whether or not a false marketing claim is successful, such assertions could have an adverse effect on our business, financial condition and results of operations, and the negative publicity surrounding them could harm our reputation and brand image. 15 Risks Related to our Manufacturing and Supply Chain We may not be able to successfully implement initiatives to improve productivity and streamline operations to control or reduce costs.

If we are unable to manage our supply chain effectively and ensure that our products are available to meet consumer demand, our operating costs could increase and our profit margins could decrease. 17 Adverse weather conditions, natural disasters, pestilences, global or local pandemics, such as COVID-19 and other natural conditions can disrupt our operations, which can adversely affect our business, financial condition and results of operations.

If we are unable to manage our supply chain effectively and ensure that our products are available to meet consumer demand, our operating costs could increase and our profit margins could decrease. 16 Adverse weather conditions, natural disasters, pestilences, global or local pandemics, such as COVID-19 and other natural conditions can disrupt our operations, which can adversely affect our business, financial condition and results of operations.

If our marketing and trade spending programs are not successful or if we fail to implement sufficient and effective marketing and trade spending programs, our business, financial condition and results of operations may be adversely affected. 14 Risks Related to our Products and Customers Our business depends on our ability to introduce new products and improve existing products in anticipation of changes in consumer preferences and demographics.

If our marketing and trade spending programs are not successful or if we fail to implement sufficient and effective marketing and trade spending programs, our business, financial condition and results of operations may be adversely affected. 13 Risks Related to our Products and Customers Our business depends on our ability to introduce new products and improve existing products in anticipation of changes in consumer preferences and demographics.

As we expand our business globally, our success will depend, in large part, on our ability to anticipate and effectively manage these and other risks associated with our operations outside of the United States and Canada. 21 Risks Related to Environmental Regulation and Environmental Risks We are subject to environmental regulation and environmental risks, which may adversely affect our business.

As we expand our business globally, our success will depend, in large part, on our ability to anticipate and effectively manage these and other risks associated with our operations outside of the United States and Canada. 20 Risks Related to Environmental Regulation and Environmental Risks We are subject to environmental regulation and environmental risks, which may adversely affect our business.

If our sales of products to one or more of our significant customers are reduced, this reduction could have a material adverse effect on our business, financial condition and results of operations. 15 If we are unable to maintain or increase prices for our products, our results of operations may be adversely affected.

If our sales of products to one or more of our significant customers are reduced, this reduction could have a material adverse effect on our business, financial condition and results of operations. 14 If we are unable to maintain or increase prices for our products, our results of operations may be adversely affected.

Prolonged unfavorable economic conditions may have an adverse effect on our sales and profitability. 19 Our ability to meet our workforce needs, particularly for staffing our Freshpet Kitchens, is crucial We rely on the existence of an available, qualified workforce to efficiently execute our operations and manufacture our products.

Prolonged unfavorable economic conditions may have an adverse effect on our sales and profitability. 18 Our ability to meet our workforce needs, particularly for staffing our Freshpet Kitchens, is crucial We rely on the existence of an available, qualified workforce to efficiently execute our operations and manufacture our products.

Any future sales of our common stock, or the perception that such sales may occur, could negatively impact the price of our common stock. Actions of activist stockholders could cause us to incur substantial costs, divert management's attention and resources, and have an adverse effect on our business.

Any future sales of our common stock, or the perception that such sales may occur, could negatively impact the price of our common stock. Actions of activist stockholders have in the past and could in the future cause us to incur substantial costs, divert management's attention and resources, and have an adverse effect on our business.

Such actions, if successful in whole or in part, may affect our ability to compete or could materially adversely affect our business, financial condition and results of operations. 20 Risks Related to Intellectual Property If we are not successful in protecting our intellectual property rights, our business, financial conditions and results of operations may be harmed.

Such actions, if successful in whole or in part, may affect our ability to compete or could materially adversely affect our business, financial condition and results of operations. 19 Risks Related to Intellectual Property If we are not successful in protecting our intellectual property rights, our business, financial conditions and results of operations may be harmed.

In recent years, we have expanded our global footprint by entering into new markets and may expand into additional markets in the future. For example, we currently do business with four retailers in the United Kingdom, where our products are selling in approximately 407 stores.

As a result, we cannot predict or estimate the amount, timing or nature of our future offerings, and purchasers of our common stock in this offering bear the risk of our future offerings reducing the market price of our common stock and diluting their ownership interest in our company. 24

In either case, our business, financial condition and results of operations could be adversely affected. 18 Restrictions imposed in reaction to outbreaks of animal diseases could have a material adverse effect on our business, financial condition and results of operations.

In either case, our business, financial condition and results of operations could be adversely affected. 17 Restrictions imposed in reaction to outbreaks of animal diseases could have a material adverse effect on our business, financial condition and results of operations.

Furthermore, we may not be able to generate sufficient taxable income to utilize our NOLs before they expire. If any of these events occur, we may not derive some or all of the expected benefits from our NOLs. In addition, NOLs incurred in one state may not be available to offset income earned in a different state.

Furthermore, we may not be able to generate sufficient taxable income to utilize our pre-2018 NOLs before they expire. If any of these events occur, we may not derive some or all of the expected benefits from our NOLs. In addition, NOLs incurred in one state will not be available to offset income earned in a different state.

In that event, the price of our common stock would likely decrease. 23 The price of our common stock has been and may continue to be volatile and you may lose all or part of your investment.

In that event, the price of our common stock would likely decrease. 22 The price of our common stock has been and may continue to be volatile and you may lose all or part of your investment.

The inputs, commodities and ingredients that we require are subject to price increases and shortages that could adversely affect our results of operations. The primary inputs, commodities and ingredients that we use include meat, vegetables, fruits, carrageenans, whole grains, vitamins, minerals, packaging and energy (including wind power).

The inputs, commodities and ingredients that we require are subject to price increases, inflationary and interest rate pressures, and shortages that could adversely affect our results of operations. The primary inputs, commodities and ingredients that we use include meat, vegetables, fruits, carrageenans, whole grains, vitamins, minerals, packaging and energy (including wind power).

A relatively limited number of customers account for a large percentage of our net sales. During 2022, ten customers, who purchase either directly from us or through third-party distributors, collectively accounted for approximately 64% of our net sales. This percentage may increase if there is consolidation among retailers or if mass merchandisers grow disproportionately to their competition.

A relatively limited number of customers account for a large percentage of our net sales. During 2023, ten customers, who purchase either directly from us or through third-party distributors, collectively accounted for approximately 73.1% of our net sales. This percentage may increase if there is consolidation among retailers or if mass merchandisers grow disproportionately to their competition.

Future sales of our common stock, or the perception that such sales may occur, could depress our common stock price. As of December 31, 2022, we had 48,037,016 shares of common stock outstanding, and our Certificate of Incorporation authorizes us to issue up to 200 million shares of common stock.

Future sales of our common stock, or the perception that such sales may occur, could depress our common stock price. As of December 31, 2023, we had 48,263,097 shares of common stock outstanding, and our Certificate of Incorporation authorizes us to issue up to 200 million shares of common stock.

As of December 31, 2022, we had federal net operating loss (“NOLs”) carryforwards of approximately $340.3 million and state NOLs of approximately $259.4 million that we may use to offset against taxable income for U.S. federal and state income tax purposes, respectively.

As of December 31, 2023, we had federal net operating loss (“NOLs”) carryforwards of approximately $420.3 million and state NOLs of approximately $312.8 million that we may use to offset against taxable income for U.S. federal and state income tax purposes, respectively.

Additionally, especially during economic downturns (including those that may be related to the COVID-19 pandemic), our customers may face financial difficulties, bankruptcy or other business disruptions that may impact their operations and their purchases from us and may affect their ability to pay us for products purchased from us.

Additionally, especially during economic downturns, our customers may face financial difficulties, bankruptcy or other business disruptions that may impact their operations and their purchases from us and may affect their ability to pay us for products purchased from us.

To meet our capital needs, we expect to continue to rely on our cash flow from operations, our credit facilities, and other third-party financing. Third-party financing in the future may not, however, be available on terms favorable to us, or at all.

To meet our capital needs, we expect to continue to rely on our cash flow from operations, as well as cash received from our Convertible Notes (as defined below), and other third-party financing. Third-party financing in the future may not, however, be available on terms favorable to us, or at all.

Failure by our transportation providers to deliver our products on time or at all could result in lost sales. We use third-party transportation providers for our product shipments. We rely on two primary providers for almost all of our shipments. Transportation services include scheduling and coordinating transportation of finished products to our customers, shipment tracking and freight dispatch services.

We use third-party transportation providers for our product shipments. We rely on two primary providers for almost all of our shipments. Transportation services include scheduling and coordinating transportation of finished products to our customers, shipment tracking and freight dispatch services.

In addition, a product recall or withdrawal may require significant management attention. As an example, in June 2022 we initiated a voluntary recall of a single lot of a particular brand due to potential salmonella contamination.

As an example, in June 2022 we initiated a voluntary recall of a single lot of a particular brand due to potential salmonella contamination.

During economic downturns (including those that may be related to the COVID-19 pandemic), our co-packers may be more susceptible to experiencing such financial difficulties, bankruptcies or other business disruptions. A new co-packing arrangement may not be available on terms as favorable to us as the existing co-packing arrangement, if at all.

During economic downturns, our co-packers may be more susceptible to experiencing such financial difficulties, bankruptcies or other business disruptions. A new co-packing arrangement may not be available on terms as favorable to us as the existing co-packing arrangement, if at all. Failure by our transportation providers to deliver our products on time or at all could result in lost sales.

Actual or anticipated attacks may cause us to incur increasing costs, including costs to deploy additional personnel and protection technologies, train employees, and engage third-party experts and consultants.

Attacks may be targeted at us, our customers and suppliers, or others who have entrusted us with information. Actual or anticipated attacks may cause us to incur increasing costs, including costs to deploy additional personnel and protection technologies, provide additional training for employees, and engage third-party experts and consultants.

Security breaches could expose us to a risk of loss or misuse of this information, litigation, and potential liability. We may not have the resources or technical sophistication to anticipate or prevent rapidly-evolving types of cyber-attacks. Attacks may be targeted at us, our customers and suppliers, or others who have entrusted us with information.

Security breaches could expose us to a risk of loss or misuse of this information, litigation, and potential liability. We, or third-party service providers on whom we may rely, may not have the resources or technical sophistication to anticipate or prevent rapidly-evolving types of cyber-attacks, including those generated by artificial intelligence.

Consumer or customer concerns (whether justified or not) regarding the quality or safety of our products could adversely affect our business. Product recalls or withdrawals can result in substantial and unexpected expenditures, destruction of product inventory, and lost sales due to the unavailability of the product for a period of time, which could reduce profitability and cash flow.

Product recalls or withdrawals can result in substantial and unexpected expenditures, destruction of product inventory, and lost sales due to the unavailability of the product for a period of time, which could reduce profitability and cash flow. In addition, a product recall or withdrawal may require significant management attention.

Loss of our key executive officers or personnel, or an inability to attract and retain such management and other personnel, could negatively affect our business. Our future success depends to a significant degree on the skills, experience and efforts of our key executive officers.

Our future success depends to a significant degree on the skills, experience and efforts of our key executive officers.

For additional possible effects of such offerings, see "Future offerings of debt securities, which would rank senior to our common stock upon our bankruptcy or liquidation, and future offerings of equity securities, which may be senior to our common stock for the purposes of dividend and liquidating distributions, may adversely affect the market price of our common stock." 13 Our ability to utilize our credit facilities may be restricted or eliminated if we cannot comply with our debt covenants, which could adversely affect our business, financial condition and results of operations.

For additional possible effects of such offerings, see "Future offerings of debt securities, which would rank senior to our common stock upon our bankruptcy or liquidation, and future offerings of equity securities, which may be senior to our common stock for the purposes of dividend and liquidating distributions, may adversely affect the market price of our common stock." 12 Loss of our key executive officers or personnel, or an inability to attract and retain such management and other personnel, could negatively affect our business.

From time to time we may be subject to claims from competitors or consumers, including consumer class actions, alleging that our product claims are deceptive, such as products being mislabeled or misbranded. Regardless of their merit, these claims can require significant time and expense to investigate and defend.

From time to time we may be subject to claims from competitors or consumers, including consumer class actions, alleging that our product claims are deceptive, such as products being mislabeled or misbranded. For example, we have had legal claims brought against us in California for our use of the word "natural" in describing certain of our products.

Removed

We are party to a Sixth Amended and Restated Loan and Security Agreement, which provides for a $350,000,000 senior secured credit facility (as amended the "Sixth Amendment"), encompassing a $300,000,000 delayed draw term loan facility (the "Delayed Draw Facility") and a $50,000,000 revolving loan facility (the "Revolving Loan Facility").

Added

Regardless of their merit, these claims can require significant time and expense to investigate and defend.

Removed

The Credit Facility contains customary representations, warranties, and covenants, including financial covenants. We cannot provide assurance that we will remain in compliance with the financial covenants during 2023.

Added

Furthermore, the increased use of smartphones, tablets, and other wireless devices, as well as continued work-from-home arrangements for a substantial portion of our corporate employees, may also heighten these and other operational risks.

Removed

Should we fail to be in compliance, and if the lenders under the Credit Facility decline to provide a waiver of such non-compliance should we seek one, then lenders could accelerate any amounts then due, or could terminate our ability to access the Credit Facility.

Added

During periods of rising interest rates, our cost of borrowing could increase, the fair value of our investments could be affected, and it could constrain the purchasing power of our customers.

Removed

If this occurs, we could be unable to access the capital needed to fund our liquidity requirements for our operations, capital expenditures and other needs, which would adversely affect our business, financial condition and results of operations.

Removed

Certain of our variable rate indebtedness uses the Secured Overnight Financing Rate ("SOFR") as a benchmark for establishing the rate of interest and may be hedged with LIBOR-based or SOFR-based interest rate derivatives. SOFR is calculated based on short-term repurchase agreements, backed by Treasury securities.

Removed

SOFR is observed and backward looking, which stands in contrast with the London Inter-Bank Offered Rate ("LIBOR") under the previous methodology, which is an estimated forward-looking rate and relies, to some degree, on the expert judgment of submitting panel members.

Removed

Given that SOFR is a secured rate backed by government securities, it is a rate that does not take into account bank credit risk, as was the case with LIBOR. SOFR is therefore likely to be lower than LIBOR and is less likely to correlate with the funding costs of financial institutions.

Removed

Because of these and other differences, there is no assurance that SOFR will perform in the same way as LIBOR would have performed at any time, and there is no guarantee that it is a comparable substitute for LIBOR. Whether or not SOFR attains market traction as a LIBOR replacement tool remains in question.

Removed

At this time, it is not possible to predict the effect of any establishment of alternative reference rates or any other reforms that may be enacted in the United Kingdom or elsewhere.

Removed

Uncertainty as to the nature of such potential changes, alternative reference rates, including SOFR, or other reforms may adversely affect the trading market for LIBOR- or SOFR-based securities, including ours.

Removed

As a result, our interest expense may increase, our ability to refinance some or all of our existing indebtedness may be affected, and our available cash flow may be adversely affected.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeInitial production on one manufacturing line began during the fourth quarter of 2022 with plans to fully commission the remaining two lines of phase 1 over the next 18 months. At the completion of phase 1 the Freshpet Kitchens Ennis facility will be approximately 400,000 square-foot.

Biggest changePhase 1 had one line commissioned during 2022 and the remaining two lines were completed during 2023, subsequent to which, the Freshpet Kitchens Ennis facility represents approximately 400,000 square-foot.

Kitchens 1.0 is approximately a 100,000 square-foot manufacturing facility, and Kitchens 2.0 is approximately a 140,000 square-foot manufacturing facility, each located in Bethlehem, Pennsylvania (together, the "Freshpet Kitchens Bethlehem"). Additionally we own a second location in Ennis, Texas ("Freshpet Kitchens Ennis").

Added

The first line in phase 2 is planned to be completed by the third quarter of 2024 with the remaining lines to be completed along with phase 3 over the next several years. At the completion of phase 2 and 3, the Freshpet Kitchens Ennis facility will grow by approximately 300,000 and 325,000 square-foot, respectively.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. LEGAL PROCEEDINGS We are party to litigation proceedings. While the results of such litigation proceedings cannot be predicted with certainty, management believes that the final outcome will not have a material adverse effect on our financial condition, results of operations or cash flows. See also “Item 1A.

Biggest changeWhile the results of such litigation proceedings cannot be predicted with certainty, management believes none of these claims or proceedings are expected to have a material adverse effect on our business, financial condition, results of operations or cash flows. See also “Item 1A.

Risk Factors” and Note 7 to our Consolidated Financial Statements for a discussion of certain legal proceedings involving the Company.

Risk Factors” and Note 9 to our Consolidated Financial Statements for a discussion of certain legal proceedings involving the Company.

Added

ITEM 3. LEGAL PROCEEDINGS We are currently involved in various claims and legal actions that arise in the ordinary course of our business.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeITEM 5. Market for registrant’s common equity, related stockholder matters and issueR purchases of equity secuRIties Market Information Shares of our common stock are publicly traded on the Nasdaq Global Market under the symbol "FRPT". The number of stockholders of record of our common stock as of February 23, 2023 was approximately 420.

The graph assumes that $100 was invested on December 31, 2018, in each of our common stock, the NASDAQ Composite and the Russell 3000. The comparisons in the table are required by the SEC and are not intended to forecast or be indicative of possible future performance of our common stock. Date Freshpet, Inc.

The graph assumes that $100 was invested on December 31, 2019, in each of our common stock, the NASDAQ Composite and the Russell 3000. The comparisons in the table are required by the SEC and are not intended to forecast or be indicative of possible future performance of our common stock. Date Freshpet, Inc.

The following graph compares our total common stock return with the total return for (i) the NASDAQ Composite Index (the “NASDAQ Composite”) and (ii) the Russell 3000 Index (the “Russell 3000”) for the five-year period ended December 31, 2022.

Removed

NASDAQ Composite Russell 3000 31-Dec-18 $ 100.00 $ 100.00 $ 100.00 31-Dec-19 $ 183.74 $ 135.23 $ 128.54 31-Dec-20 $ 441.51 $ 194.24 $ 152.73 31-Dec-21 $ 296.24 $ 235.78 $ 189.39 31-Dec-22 $ 164.09 $ 157.74 $ 150.61 Unregistered sales of equity securities On September 29, 2022, the Company issued to operators of Freshpet Kitchens South warrants to purchase up to an aggregate of 194 thousand shares of our voting common stock, on a cashless exercise basis, at a price of $0.01 per share.

Added

NASDAQ Composite Russell 3000 31-Dec-19 $ 100.00 $ 100.00 $ 100.00 31-Dec-20 $ 240.29 $ 143.64 $ 118.82 31-Dec-21 $ 161.23 $ 174.36 $ 147.35 31-Dec-22 $ 89.30 $ 116.65 $ 117.17 31-Dec-23 $ 146.83 $ 167.30 $ 145.24 26

Removed

The warrants were issued as partial consideration to this operator under our supply agreement with them for a value of approximately $9.8 million under that agreement. The foregoing transaction did not involve any underwriters, any underwriting discounts or commissions, or any public offering.

Removed

We believe the issuance described above was exempt from registration under the Securities Act by virtue of Section 4(a)(2) of the Securities Act, because the issuance of securities to the recipients did not involve a public offering. The issuances of these securities were made without any general solicitation or advertising. 26

Item 7. Management's Discussion & Analysis

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

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2023 filing

Biggest changeConsolidated Statements of Operations and Comprehensive Loss Twelve Months Ended December 31, 2022 2021 2020 Amount % of Net Sales Amount % of Net Sales Amount % of Net Sales (Dollars in thousands) Net sales $ 595,344 100 % $ 425,489 100 % $ 318,790 100 % Cost of goods sold 409,311 69 263,343 62 185,880 58 Gross profit 186,033 31 162,146 38 132,910 42 Selling, general and administrative expenses 238,016 40 186,809 44 134,908 42 Loss from operations (51,983 ) (9 ) (24,663 ) (6 ) (1,998 ) (1 ) Other income/(expenses), net 1,710 0 13 0 87 0 Interest expense (5,208 ) (1 ) (2,882 ) (1 ) (1,212 ) (0 ) Loss before income taxes (55,481 ) (10 ) (27,532 ) (6 ) (3,123 ) (1 ) Income tax expense 282 0 162 0 65 0 Loss on equity method investment 3,731 1 2,005 0 - 0 Net loss $ (59,494 ) (10 )% $ (29,699 ) (7 )% $ (3,188 ) (1 )% 34 Twelve Months Ended December 31, 2022 Compared To Twelve Months Ended December 31, 2021 Net Sales The following table sets forth net sales by class of retail: Year Ended December 31, 2022 2021 Amount % of Net Sales Store Count Amount % of Net Sales Store Count (Dollars in thousands) Grocery (including Online), Mass and Club (1) $ 524,971 88 % 19,670 $ 356,965 84 % 18,139 Pet Specialty and Natural (2) 70,373 12 % 5,611 68,524 16 % 5,492 Net Sales (3) $ 595,344 100 % 25,281 $ 425,489 100 % 23,631 (1) Stores at December 31, 2022 and December 31, 2021 consisted of 13,847 and 12,723 grocery (including online) and 5,823 and 5,416 mass and club, respectively.

Biggest changeAt December 31, 2023, we had a full valuation allowance against our net deferred tax assets as the realization of such assets was not considered more likely than not. 28 Consolidated Statements of Operations and Comprehensive Loss Twelve Months Ended December 31, 2023 2022 2021 Amount % of Net Sales Amount % of Net Sales Amount % of Net Sales (Dollars in thousands) Net sales $ 766,895 100 % $ 595,344 100 % $ 425,489 100 % Cost of goods sold 516,023 67 409,311 69 263,343 62 Gross profit 250,872 33 186,033 31 162,146 38 Selling, general and administrative expenses 281,318 37 238,016 40 186,809 44 Loss from operations (30,446 ) (4 ) (51,983 ) (9 ) (24,663 ) (6 ) Interest and other income, net 13,029 2 1,710 0 13 0 Interest expense (14,097 ) (2 ) (5,208 ) (1 ) (2,882 ) (1 ) Loss before income taxes (31,514 ) (4 ) (55,481 ) (10 ) (27,532 ) (6 ) Income tax expense 210 0 282 0 162 0 Loss on equity method investment 1,890 0 3,731 1 2,005 0 Net loss $ (33,614 ) (4 )% $ (59,494 ) (10 )% $ (29,699 ) (7 )% Twelve Months Ended December 31, 2023 Compared To Twelve Months Ended December 31, 2022 Net Sales The following table sets forth net sales by class of retail: Year Ended December 31, 2023 2022 Amount % of Net Sales Store Count Amount % of Net Sales Store Count (Dollars in thousands) Grocery, Mass and Club (1) $ 685,307 89 % 21,135 $ 524,971 88 % 19,670 Pet Specialty and Natural (2) 81,588 11 % 5,642 70,373 12 % 5,611 Net Sales $ 766,895 100 % 26,777 $ 595,344 100 % 25,281 (1) Stores at December 31, 2023 and December 31, 2022 consisted of 14,800 and 13,847 grocery and 6,335 and 5,823 mass and club, respectively.

Our business model is difficult for others to replicate, and we see significant opportunity for future growth by leveraging the unique elements of our business, including our brand, our product know-how, our Freshpet Kitchens, our refrigerated distribution, our Freshpet Fridge and our culture.

Our business model is difficult for others to replicate, and we see significant opportunity for future growth by leveraging the unique elements of our business, including our brand, product know-how, Freshpet Kitchens, refrigerated distribution, Freshpet Fridge, and culture.

Additionally, our cash flow generation ability is subject to general economic factors, including but not limited to increasing inflation and interest rates, financial, competitive, legislative and regulatory factors and other factors that are beyond our control.

Additionally, our cash flow generation ability is subject to general economic factors, including but not limited to increasing interest rates and inflation, financial, competitive, legislative and regulatory factors and other factors that are beyond our control.

Research and development costs consist of expenses to develop and test new products. The costs are expensed as incurred. 33 Brokerage. We use third-party brokers to assist with monitoring our products at the point-of-sale as well as representing us at headquarters for various customers. These brokers visit our retail customers’ store locations to ensure items are appropriately stocked and maintained.

Research and development costs consist of expenses to develop and test new products. The costs are expensed as incurred. Brokerage. We use third-party brokers to assist with monitoring our products at the point-of-sale as well as representing us at headquarters for various customers. These brokers visit our retail customers’ store locations to ensure items are appropriately stocked and maintained.

To the extent that there are differences between our estimate and the actual results, our future financial statement presentation, financial condition, results of operations and cash flows will be affected. 44 The following critical accounting policies reflect significant judgments and estimates used in preparation of our consolidated financial statements: Revenue Recognition and Incentives —Revenue is reported net of applicable trade incentives and allowances.

To the extent that there are differences between our estimate and the actual results, our future financial statement presentation, financial condition, results of operations and cash flows will be affected. 38 The following critical accounting policies reflect significant judgments and estimates used in preparation of our consolidated financial statements: Revenue Recognition and Incentives —Revenue is reported net of applicable trade incentives and allowances.

The performance-based awards with financial criteria either have a Net Sales and/or Adjusted EBITDA target from FY 2023 through FY 2025. We recognize the estimated fair value of performance-based awards as share-based compensation expense over the performance period based upon our determination of whether it is probable that the performance targets will be achieved.

The performance-based awards with financial criteria either have a Net Sales and/or Adjusted EBITDA target from FY 2023 through FY 2026. We recognize the estimated fair value of performance-based awards as share-based compensation expense over the performance period based upon our determination of whether it is probable that the performance targets will be achieved.

Management’s Discussion and Analysis of Financial Condition and Results of Operations" in the Company's 2021 Annual Report on Form 10-K, which information is incorporated herein by reference. Overview We started Freshpet with a single-minded mission to bring the power of real, fresh food to our dogs and cats.

Management’s Discussion and Analysis of Financial Condition and Results of Operations" in the Company's 2022 Annual Report on Form 10-K, which information is incorporated herein by reference. Overview We started Freshpet with a single-minded mission to bring the power of real, fresh food to our dogs and cats.

Recent Accounting Pronouncements For a discussion of recent accounting pronouncements, see Note 1 (Summary of Significant Accounting Policies) to our audited consolidated financial statements included in this report. Segment We have determined we operate in one segment: the manufacturing, marketing and distribution of pet food and pet treats for dogs and cats. 45

(c) Represents COVID-19 expenses including (i) costs incurred to protect the health and safety of our employees during the COVID-19 pandemic, (ii) temporary increased compensation expense to ensure continued operations during the pandemic, and (iii) costs related to mitigating potential supply chain disruptions during the pandemic included in SG&A.

(e) Represents COVID-19 expenses including (i) costs incurred to protect the health and safety of our employees during the COVID-19 pandemic, (ii) temporary increased compensation expense to ensure continued operations during the pandemic, and (iii) costs related to mitigating potential supply chain disruptions during the pandemic included in SG&A.

Our investments in marketing and advertising help to drive awareness and trial at each point of sale. ● Increasing penetration of Freshpet Fridge locations in major classes of retail, including Grocery (including online), Mass, Club, Pet Specialty and Natural.

For more information regarding our consolidated results and liquidity and capital resources for the year ended December 31, 2021 as compared to the year ended December 31, 2020, refer to "Part II, Item 7.

For more information regarding our consolidated results and liquidity and capital resources for the year ended December 31, 2022 as compared to the year ended December 31, 2021, refer to "Part II, Item 7.

Income Taxes We had federal net operating loss (“NOL”) carry forwards of approximately $340.3 million as of December 31, 2022, of which, approximately $175.4 million, generated in 2017 and prior, will expire between 2025 and 2037.

Income Taxes We had federal net operating loss (“NOL”) carry forwards of approximately $420.3 million as of December 31, 2023, of which, approximately $175.4 million, generated in 2017 and prior, will expire between 2025 and 2037.

The NOL generated from 2018 through 2022, of approximately $164.9 million, will have an indefinite carryforward period but can generally only be used to offset 80% of taxable income in any particular year.

The NOL generated from 2018 through 2023, of approximately $244.9 million, will have an indefinite carryforward period, but can generally only be used to offset 80% of taxable income in any particular year.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of net sales and expenses during the reporting period.

GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of net sales and expenses during the reporting period.

(d) Represents transition costs related to the organization changes designed to support growth, including several changes in organizational structure designed to enhance capabilities and support long-term growth objectives. 38 The following table provides a reconciliation of Adjusted Gross Profit to Gross Profit, the most directly comparable financial measure presented in accordance with U.S.

(f) Represents a true-up to transition costs related to the organization changes designed to support growth, including several changes in organizational structure designed to enhance capabilities and support long-term growth objectives. 32 The following table provides a reconciliation of Adjusted Gross Profit to Gross Profit, the most directly comparable financial measure presented in accordance with U.S.

Loss on Equity Method Investment Our loss on equity method investment for the twelve months ended December 31, 2022 was $3.7 million as compared to a loss on equity method investment of $2.0 million in the prior year from the Company's 19% interest in a privately held company, as discussed in Note 1.

Loss on Equity Method Investment Our loss on equity method investment for the twelve months ended December 31, 2023 was $1.9 million as compared to a loss on equity method investment of $3.7 million in the prior year from the Company's interest in a privately held company, as discussed in Note 1.

If we issue additional equity or convertible debt securities, existing stockholders may experience dilution, and such new securities could have rights senior to those of our common stock. These factors may make the timing, amount, terms and conditions of additional financings unattractive.

If we issue additional equity or if the Convertible Notes are converted to common shares, existing stockholders may experience dilution, and such new securities could have rights senior to those of our common stock. These factors may make the timing, amount, terms and conditions of additional financing unattractive.

We expect to fund our ongoing operations and obligations with cash and cash equivalents, cash flow from operations and available funds under our Credit Facility. 41 The following table sets forth, for the periods indicated, our beginning balance of cash, net cash flows provided by operating, investing and financing activities and our ending balance of cash.

We expect to fund our ongoing operations and obligations with cash and cash equivalents, and cash flow from operations. 35 The following table sets forth, for the periods indicated, our beginning balance of cash, net cash flows provided by operating, investing and financing activities and our ending balance of cash.

While our significant accounting estimates and policies are described in the notes to our financial statements appearing in this report, we believe that the following critical accounting estimates and policies are most important to understanding and evaluating our reported financial results.

Our net sales growth is driven by the following key factors: ● Increasing sales velocity from the average Freshpet Fridge due to increasing awareness, trial and adoption of Freshpet products and innovation.

Sales are recorded net of discounts, returns and promotional allowances. Our net sales growth is driven by the following key factors: ● Increasing sales velocity from the average Freshpet Fridge due to increasing awareness, trial and adoption of Freshpet products and innovation.

For the twelve months ended December 31, 2022, Adjusted Gross Profit was $214.1 million, or 36.0% as a percentage of net sales, compared to $184.6 million, or 43.4% as a percentage of net sales, in the prior year.

For the twelve months ended December 31, 2023, Adjusted Gross Profit was $306.6 million, or 40.0% as a percentage of net sales, compared to $214.1 million, or 36.0% as a percentage of net sales, in the prior year.

The impact of new Freshpet Fridge installations on our net sales varies by retail class and depends on numerous factors including store traffic, refrigerator size, placement within the store, and proximity to other stores that carry our products. ● Consumer trends including growing pet ownership, pet humanization and a focus on health and wellness.

(d) Represents COVID-19 expenses including (i) costs incurred to protect the health and safety of our employees during the COVID-19 pandemic, (ii) temporary increased compensation expense to ensure continued operations during the pandemic, and (iii) costs related to mitigating potential supply chain disruptions during the pandemic. (e) Represents advisory fees related to activism engagement.

GAAP: Twelve Months Ended December 31, 2022 2021 2020 (Dollars in thousands) Gross Profit $ 186,033 $ 162,146 $ 132,910 Depreciation expense 20,774 16,545 9,576 Non-cash share-based compensation 7,293 4,152 2,132 COVID-19 expense (a) — 1,753 3,497 Adjusted Gross Profit $ 214,100 $ 184,596 $ 148,115 Adjusted Gross Profit as a % of Net Sales 36.0 % 43.4 % 46.5 % (a) Represents COVID-19 expenses including (i) costs incurred to protect the health and safety of our employees during the COVID-19 pandemic, (ii) temporary increased compensation expense to ensure continued operations during the pandemic, and (iii) costs related to mitigating potential supply chain disruptions during the pandemic included in cost of goods sold.

GAAP: Twelve Months Ended December 31, 2023 2022 2021 (Dollars in thousands) Gross profit $ 250,872 $ 186,033 $ 162,146 Depreciation expense 41,209 20,774 16,545 Non-cash share-based compensation 10,995 7,293 4,152 COVID-19 expense (a) — — 1,753 Loss on disposal of manufacturing equipment 3,547 — — Adjusted Gross Profit $ 306,623 $ 214,100 $ 184,596 Adjusted Gross Profit as a % of Net Sales 40.0 % 36.0 % 43.4 % (a) Represents COVID-19 expenses including (i) costs incurred to protect the health and safety of our employees during the COVID-19 pandemic, (ii) temporary increased compensation expense to ensure continued operations during the pandemic, and (iii) costs related to mitigating potential supply chain disruptions during the pandemic included in cost of goods sold.

Additionally, our ability to make payments on, and to refinance, any indebtedness under our credit facilities and to fund any necessary expenditures for our growth will depend on our ability to generate cash in the future.

Our ability to make future minimum interest payments on the Convertible Notes, to refinance any indebtedness and to fund any necessary expenditures for our growth will depend on our ability to generate cash in the future.

For example, the non-GAAP financial measures do not reflect: ● our capital expenditures or future requirements for capital expenditures; ● the interest expense, or the cash requirements necessary to service interest expense or principal payments, associated with indebtedness; ● depreciation and amortization, which are non-cash charges, although the assets being depreciated and amortized will likely have to be replaced in the future, nor any cash requirements for such replacements; and ● changes in cash requirements for our working capital needs. 37 Additionally, Adjusted EBITDA excludes non-cash share-based compensation expense, which is and will remain a key element of our overall long-term incentive compensation package.

GAAP results and the reconciliation to the closest comparable U.S. GAAP measures, provides a more complete understanding of our business than could be obtained absent this disclosure. We use the non-GAAP financial measures, together with U.S.

We believe that each of these non-GAAP financial measures provide additional metrics to evaluate our operations and, when considered with both our U.S. GAAP results and the reconciliation to the closest comparable U.S. GAAP measures, provides a more complete understanding of our business than could be obtained absent this disclosure. We use the non-GAAP financial measures, together with U.S.

The decrease was primarily due to the change in accounts receivable, inventory, accounts payable, other assets, other lease liabilities and prepaid expenses, offset by change in accrued expenses. 2021 Net cash provided by operating activities of $0.6 million in 2021 was primarily attributed to: ● $31.2 million of net income adjusted for reconciling non-cash items, which excludes $60.9 million of non-cash items primarily related to $30.5 million in depreciation and amortization, $25.0 million in share-based compensation, $2.0 million of investments in equity method investment, $1.3 million of change in operating lease right of use asset, $1.2 million of amortization of deferred financing costs, $0.5 million in loss on disposal of equipment, and $0.3 million in inventory obsolescence.

The increase was primarily due to the change in accounts receivable, accounts payable and accrued expenses, primarily offset by the change in inventories, prepaid expenses and other current assets, other assets and operating lease liability. 2022 Net cash used in operating activities of $43.2 million in 2022 was primarily attributed to: ● $10.9 million of net income adjusted for reconciling non-cash items, which excludes $70.4 million of non-cash items primarily related to $34.6 million in depreciation and amortization, $26.1 million in share-based compensation, $3.7 million of investments in equity method investment, $3.5 million in inventory obsolescence, $1.4 million of change in operating lease right of use asset, $0.8 million of amortization of deferred financing costs and $0.4 million in loss on disposal of property, plant and equipment.

Our ability to obtain additional funding will be subject to various factors, including general market conditions, our operating performance, the market’s perception of our growth potential, lender sentiment and our ability to incur additional debt in compliance with other contractual restrictions, such as financial covenants under our debt agreements, which we cannot provide assurance we will be able to do.

Our ability to obtain additional funding will be subject to various factors, including general economic and market conditions, our operating performance, the market's perception of our growth potential, lender sentiment and our ability to incur additional debt in compliance with other contractual restrictions.

The decrease was primarily due to the change in accounts receivable, inventory, other assets, prepaid expenses, other lease liabilities and accrued expenses, offset by change in accounts payable. 42 Net Cash Used in Investing Activities 2022 Net cash used in investing activities of $233.4 million in 2022 was primarily attributed to: ● $28.4 million in capital expenditures related to Freshpet Kitchens South expansion. ● $165.1 million in capital expenditures related to Freshpet Kitchens Ennis expansion. ● $27.4 million in in capital expenditures related to investment in fridges and other capital spend. ● $9.2 million in plant recurring capital expenditures. ● $19.8 million purchase of short-term investments. ● $3.3 million investment in equity method investment.

The decrease was primarily due to the change in accounts receivable, inventory, accounts payable, other assets, other lease liabilities and prepaid expenses, offset by change in accrued expenses. 36 Net Cash Used in Investing Activities 2023 Net cash used in investing activities of $239.1 million in 2023 was primarily attributed to: ● $5.3 million in capital expenditures related to Freshpet Kitchens South expansion. ● $183.5 million in capital expenditures related to Freshpet Kitchens Ennis expansion. ● $39.3 million in capital expenditures related to investment in fridges and other capital spend. ● $11.0 million in plant recurring capital expenditures. ● $113.4 million purchase of short-term investments.

This was partially offset by: ● $78.0 million for repayment of borrowings under Credit Facility ● $1.4 million for tax withholdings related to net share settlements of restricted stock units. 2021 Net cash provided by financing activities of $327.0 million in 2021 was primarily attributed to: ● $332.2 million of proceeds from common shares issued in a primary offering, net of issuance cost. ● $2.3 million of proceeds from the exercise of stock options.

This was partially offset by: ● $66.2 million for the purchase of capped call options. ● $2.0 million for debt issuance costs. ● $1.4 million for tax withholdings related to net share settlements of restricted stock units. ● $1.1 million for principal payments under finance lease obligations. 2022 Net cash provided by financing activities of $336.5 million in 2022 was primarily attributed to: ● $337.5 million of proceeds from common shares issued in a primary offering, net of issuance cost. ● $78.0 million of proceeds from borrowings under Credit Facility. ● $0.5 million of proceeds from the exercise of stock options.

The decrease in Adjusted EBITDA was a result of increased Adjusted SG&A expense (including $4.1 million of launch expense) partially offset by higher net sales and Adjusted Gross Profit (including $26.1 million of plant start-up expense). See "—Non-GAAP Financial Measures" for how we define Adjusted EBITDA, a reconciliation of Adjusted EBITDA to EBITDA, the closest comparable U.S.

The increase in Adjusted EBITDA was a result of increased Adjusted Gross Profit partially offset by higher Adjusted SG&A expense. See "—Non-GAAP Financial Measures" for how we define Adjusted EBITDA, a reconciliation of Adjusted EBITDA to EBITDA, the closest comparable U.S.

GAAP measure, certain limitations of Non-GAAP measures and why management has included such Non-GAAP measures, as well as for a discussion of certain changes we made to our methodology for calculating Adjusted EBITDA beginning with the period ending September 30, 2022; see the section entitled "Forward-Looking Statements" in this report and the section entitled "Risk Factors" in this report for factors that could cause our results to differ, in some cases materially. 36 Non-GAAP Financial Measures Freshpet uses the following non-GAAP financial measures in its financial communications.

GAAP measure, certain limitations of Non-GAAP measures and why management has included such Non-GAAP measures; see the section entitled "Forward-Looking Statements" in this report and the section entitled "Risk Factors" in this report for factors that could cause our results to differ, in some cases materially. Non-GAAP Financial Measures Freshpet uses the following non-GAAP financial measures in its financial communications.

Loss from Operations Loss from operations increased by $27.3 million to a loss from operations of $52.0 million for the twelve months ended December 31, 2022 as compared to a loss from operations of $24.7 million in the prior year as a result of the factors discussed above.

Loss from Operations As a result of the factors discussed above, loss from operations decreased by $21.5 million to a loss from operations of $30.4 million for the twelve months ended December 31, 2023 as compared to a loss from operations of $52.0 million in the prior year.

Selling, General and Administrative Expenses Our selling, general and administrative expenses consist of the following: Outbound freight. We use a third-party logistics provider for outbound freight that ships directly to retailers as well as third-party distributors. Marketing & advertising.

We expect to continue to mitigate any adverse movement in input costs through a combination of cost management and price increases. Selling, General and Administrative Expenses Our selling, general and administrative expenses consist of the following: Outbound freight. We use a third-party logistics provider for outbound freight that ships directly to retailers as well as third-party distributors. Marketing & advertising.

We believe that cash and cash equivalents, expected cash flow from operations, planned borrowing capacity and our ability to access the capital markets, if appropriate, are adequate to fund our debt service requirements, operating lease obligations, capital expenditures and working capital obligations for the foreseeable future.

We believe that cash and cash equivalents, short-term investments, expected cash flow from operations, amounts previously raised through the issuance of the Convertible Notes and our ability to access the capital markets, if appropriate, are adequate to fund our debt requirements, operating and finance lease obligations, capital expenditures and working capital obligations for the foreseeable future.

This was offset by: ● $19.8 million of proceeds from maturities of short-term investments. 2021 Net cash used in investing activities of $322.1 million in 2021 was primarily attributed to: ● $3.0 million in capital expenditures related to Freshpet Kitchens Bethlehem expansion. ● $73.8 million in capital expenditures related to Freshpet Kitchens South expansion. ● $208.2 million in capital expenditures related to Freshpet Kitchens Ennis expansion. ● $16.8 million in plant recurring capital expenditures. ● $20.3 million in capital expenditures relating to investment in fridges and other capital spend.

This was partially offset by: ● $113.4 million of proceeds from maturities of short-term investments. 2022 Net cash used in investing activities of $233.4 million in 2022 was primarily attributed to: ● $28.4 million in capital expenditures related to Freshpet Kitchens South expansion. ● $165.1 million in capital expenditures related to Freshpet Kitchens Ennis expansion. ● $27.4 million in capital expenditures related to investment in fridges and other capital spend. ● $9.2 million in plant recurring capital expenditures. ● $19.8 million purchase of short-term investments. ● $3.3 million investment in equity method investment.

This was partially offset by: ● $4.2 million for tax withholdings related to net share settlements of restricted stock units. ● $3.3 million for debt issuance cost related to the new credit facilities. 43 Indebtedness For a discussion of our material indebtedness, see Note 6 to our Consolidated Financial Statements included in this report.

This was partially offset by: ● $78.0 million for repayment of borrowings under Credit Facility. ● $1.4 million for tax withholdings related to net share settlements of restricted stock units. 37 Indebtedness For a discussion of our material indebtedness, see Note 6 and 7 to our Consolidated Financial Statements included in this report.

GAAP. We define Adjusted Gross Profit as Gross Profit before depreciation expense, non-cash share-based compensation and COVID-19 expenses.

GAAP. We define Adjusted Gross Profit as Gross Profit before depreciation expense, non-cash share-based compensation, and loss on disposal of manufacturing equipment.

Year Ended December 31, 2022 2021 (Dollars in thousands) Cash at the beginning of period $ 72,788 $ 67,247 Net cash (used in) provided by operating activities (43,227 ) 647 Net cash used in investing activities (233,364 ) (322,099 ) Net cash provided by financing activities 336,538 326,993 Cash at the end of period $ 132,735 $ 72,788 Net C ash (Used In) Provided by Operating Activities Cash (used in) provided by operating activities consists primarily of net loss adjusted for certain non-cash items (i.e., provision for loss on receivables, loss/(gain) on disposal of equipment, change in reserve for inventory obsolescence, depreciation and amortization, amortization of deferred financing costs and loan discount, change in operating lease right of use asset, loss on equity method investment, and share-based compensation). 2022 Net cash used in operating activities of $43.2 million in 2022 was primarily attributed to: ● $10.9 million of net income adjusted for reconciling non-cash items, which excludes $70.4 million of non-cash items primarily related to $34.6 million in depreciation and amortization, $26.1 million in share-based compensation, $3.7 million of investments in equity method investment, $3.5 million in inventory obsolescence, $1.4 million of change in operating lease right of use asset, $0.8 million of amortization of deferred financing costs and $0.4 million in loss on disposal of equipment.

Year Ended December 31, 2023 2022 (Dollars in thousands) Cash at the beginning of period $ 132,735 $ 72,788 Net cash provided by (used in) operating activities 75,940 (43,227 ) Net cash used in investing activities (239,093 ) (233,364 ) Net cash provided by financing activities 327,289 336,538 Cash at the end of period $ 296,871 $ 132,735 Net Cash Provided by (Used In) Operating Activities Cash provided by (used in) operating activities consists primarily of net loss adjusted for certain non-cash items (i.e., provision for (gains) loss on receivable, loss on disposal of property, plant and equipment, share-based compensation, change in reserve for inventory obsolescence, depreciation and amortization, write-off and amortization of deferred financing costs and loan discount, change in operating lease right of use asset and loss on equity method investment). 2023 Net cash provided by operating activities of $75.9 million in 2023 was primarily attributed to: ● $61.7 million of net income adjusted for reconciling non-cash items, which excludes $95.3 million of non-cash items primarily related to $4.3 million of loss on disposal of property, plant and equipment, $24.9 million of share-based compensation including amortization of warrants, $58.5 million of depreciation and amortization, $4.1 million of write-off and amortization of deferred financing costs and loan discount, $1.5 million of change in operating lease right of use asset and $1.9 million of loss on equity method investment. ● $14.3 million increase due to changes in operating assets and liabilities.

Our presentation of the non-GAAP financial measures should not be construed as an inference that our future results will be unaffected by the expenses that are excluded from that term or by unusual or non-recurring items. We recognize that the non-GAAP financial measures have limitations as analytical financial measures.

Our non-GAAP financial measures may not be comparable to similarly titled measures in other organizations because other organizations may not calculate non-GAAP financial measures in the same manner as we do. 31 Our presentation of the non-GAAP financial measures should not be construed as an inference that our future results will be unaffected by the expenses that are excluded from that term or by unusual or non-recurring items.

We define Adjusted SG&A as SG&A expenses before depreciation and amortization expense, non-cash share-based compensation, fees related to equity offerings of our common stock, implementation and other costs associated with the implementation of an ERP system, loss on disposal of equipment, COVID-19 expenses, and organization changes designed to support long-term growth objectives.

We define Adjusted SG&A as SG&A expenses before depreciation and amortization expense, non-cash share-based compensation, implementation and other costs associated with the implementation of an ERP system, fees related to the Capped Call Transactions, loss on disposal of equipment, and advisory fees related to activism engagement.

Working capital increased $81.0 million to $172.4 million at December 31, 2022 compared with working capital of $91.4 million at December 31, 2021.

Working capital increased $165.7 million to $338.1 million at December 31, 2023 compared with working capital of $172.4 million at December 31, 2022.

Gross Profit Gross profit was $186.0 million, or 31.2% as a percentage of net sales, for the twelve months ended December 31, 2022, compared to $162.1 million, or 38.1% as a percentage of net sales, in the prior year.

The net sales increase was primarily driven by volume gains of 20%. 29 Gross Profit Gross profit was $250.9 million, or 32.7% as a percentage of net sales, for the twelve months ended December 31, 2023, compared to $186.0 million, or 31.2% as a percentage of net sales, in the prior year.

GAAP: Twelve Months Ended December 31, 2022 2021 2020 (Dollars in thousands) Net loss $ (59,494 ) $ (29,699 ) $ (3,188 ) Depreciation and amortization 34,555 30,468 21,125 Interest expense 5,208 2,882 1,211 Income tax expense 282 162 65 EBITDA $ (19,449 ) $ 3,813 $ 19,213 Loss on equity method investment $ 3,731 $ 2,005 $ - Loss on disposal of equipment 396 1,000 1,805 Non-cash share-based compensation 26,092 24,998 10,925 Equity offering expenses (a) — — 58 Enterprise Resource Planning (b) 8,558 1,379 1,682 COVID-19 expense (c) — 1,758 3,854 Organization changes (d) 734 — — Adjusted EBITDA $ 20,062 $ 34,953 $ 37,537 Adjusted EBITDA as a % of Net Sales 3.4 % 8.2 % 11.8 % (a) Represents fees associated with public offerings of our common stock.

GAAP: Twelve Months Ended December 31, 2023 2022 2021 (Dollars in thousands) Net loss $ (33,614 ) $ (59,494 ) $ (29,699 ) Depreciation and amortization 57,058 34,555 30,468 Interest expense, net of interest income 1,069 5,208 2,882 Income tax expense 210 282 162 EBITDA $ 24,723 $ (19,449 ) $ 3,813 Loss on equity method investment $ 1,890 $ 3,731 $ 2,005 Loss on disposal of property, plant and equipment 4,321 396 1,000 Non-cash share-based compensation (a) 24,936 26,092 24,998 Enterprise Resource Planning (b) 2,457 8,558 1,379 Capped Call Transaction fees (c) 113 — — COVID-19 expense (d) — — 1,758 Activism engagement (e) 8,177 — — Organization changes (f) (67 ) 734 — Adjusted EBITDA $ 66,550 $ 20,062 $ 34,953 Adjusted EBITDA as a % of Net Sales 8.7 % 3.4 % 8.2 % (a) Includes the true-up of share-based compensation expense during the period ended December 31, 2023.

To meet our capital needs, we expect to rely on our current and future cash flow from operations, our available borrowing capacity, and access to the capital markets, if appropriate.

We expect to rely on our current and future cash flow from operations, may issue additional debt, and/or raise capital through our access to capital markets, if appropriate.

GAAP: Twelve Months Ended December 31, 2022 2021 2020 (Dollars in thousands) SG&A expenses $ 238,016 $ 186,809 $ 134,908 Depreciation and amortization expense 13,781 13,923 11,549 Non-cash share-based compensation 18,799 20,846 8,793 Loss on disposal of equipment 396 1,000 1,805 Equity offering expenses (a) — — 58 Enterprise Resource Planning (b) 8,558 1,379 1,682 COVID-19 expense (c) — 5 357 Organization changes (d) 734 — — Adjusted SG&A Expenses $ 195,748 $ 149,656 $ 110,664 Adjusted SG&A Expenses as a % of Net Sales 32.9 % 35.2 % 34.7 % (a) Represents fees associated with public offerings of our common stock.

GAAP: Twelve Months Ended December 31, 2023 2022 2021 (Dollars in thousands) SG&A expenses $ 281,318 $ 238,016 $ 186,809 Depreciation and amortization expense 15,849 13,781 13,923 Non-cash share-based compensation (a) 13,941 18,799 20,846 Loss on disposal of equipment 774 396 1,000 Enterprise Resource Planning (b) 2,457 8,558 1,379 Capped Call Transactions fees (c) 113 — — Activism engagement (d) 8,177 — — COVID-19 expense (e) — — 5 Organization changes (f) (67 ) 734 — Adjusted SG&A Expenses $ 240,074 $ 195,748 $ 149,656 Adjusted SG&A Expenses as a % of Net Sales 31.3 % 32.9 % 35.2 % (a) Includes the true-up of share-based compensation expense during the period ended December 31, 2023.

The following table provides a reconciliation of EBITDA and Adjusted EBITDA to net loss, the most directly comparable financial measure presented in accordance with U.S.

Other companies in our industry may calculate the non-GAAP financial measures differently than we do, limiting their usefulness as comparative measures. The following table provides a reconciliation of EBITDA and Adjusted EBITDA to net loss, the most directly comparable financial measure presented in accordance with U.S.

Adjusted EBITDA represents EBITDA plus loss on equity method investment, non-cash share-based compensation, fees related to equity offerings of our common stock, implementation and other costs associated with the implementation of an ERP system, loss on disposal of equipment, COVID-19 expenses, and organization changes designed to support long-term growth objectives.

Adjusted EBITDA represents EBITDA plus loss on equity method investment, non-cash share-based compensation, implementation and other costs associated with the implementation of an ERP system, loss on disposal of property, plant and equipment, fees related to the Capped Call Transactions, and advisory fees related to activism engagement.

Adjusted SG&A for the twelve months ended December 31, 2022, was $195.7 million, or 32.9% as a percentage of net sales, compared to $149.7 million, or 35.2% as a percentage of net sales, in the prior year.

Adjusted SG&A for the twelve months ended December 31, 2023, was $240.1 million, or 31.3% as a percentage of net sales, compared to $195.7 million, or 32.9% as a percentage of net sales, in the prior year. See “—Non-GAAP Financial Measures” for how we define Adjusted SG&A, a reconciliation of Adjusted SG&A to SG&A, the closest comparable U.S.

Gross Profit Our gross profit is net of costs of goods sold, which include the costs of product manufacturing, product ingredients, packaging materials and inbound freight, as well as depreciation and amortization and non-cash share-based compensation. We expect to continue to mitigate any adverse movement in input costs through a combination of cost management and price increases.

We believe that as a result of the above key factors, we will continue to penetrate the pet food marketplace and increase our share of the pet food category. 27 Gross Profit Our gross profit is net of costs of goods sold, which include the costs of product manufacturing, product ingredients, packaging materials and inbound freight, as well as depreciation and amortization and non-cash share-based compensation.

During fiscal year 2022, we spent approximately $230.1 million of capital to meet our capacity needs as well as recurring capital expenditures. In fiscal year 2023, we expect to spend approximately $240.0 million.

We expect to make future capital expenditures in connection with the completion of our planned development of Freshpet Kitchens Ennis phase 2 and 3. During fiscal year 2023, we spent approximately $239.1 million of capital to meet our capacity needs as well as recurring capital expenditures. In fiscal year 2024, we expect to spend approximately $210.0 million.

The increase was partially offset by an increase in accounts payable of $12.5 million as a result of timing and capital expenditures of approximately $38.0 million related to our capital expansion plan, and an increase in accrued expenses of $18.1 million as a result of timing and capital expenditures of approximately $6.2 million related to our capital expansion plan.

The increase was partially offset by a decrease in accounts receivable of $0.8 million, a decrease in prepaid expenses of $2.2 million, a decrease in other current assets of $0.7 million, an increase in accrued expenses of $16.8 million due to timing and capital expenditures of approximately $3.8 million related to our capital expansion plan, and an increase in current finance lease liabilities of $2.0 million.

As a percentage of net sales, SG&A decreased to 40.0% for the twelve months ended December 31, 2022, compared to 43.9% in the prior year. The decrease of 390 basis points in SG&A as a percentage of net sales was mainly a result of increased selling, general and administrative expense leverage as the business scales.

Selling, General and Administrative Expenses Selling, general and administrative expenses ("SG&A") were $281.3 million, for the twelve months ended December 31, 2023, compared to $238.0 million in the prior year. As a percentage of net sales, SG&A decreased to 36.7% for the twelve months ended December 31, 2023, compared to 40.0% in the prior year.

Our credit facilities reflect $2.0 million reserved for two letters of credit and the remaining availability after 2022 borrowing activity of $78.0 million under the Delayed Draw Facility. For the year ended December 31, 2021, our capital resources consisted primarily of $72.8 million cash on hand, $348.0 million available under our $350.0 million credit facilities, subject to debt covenants.

Our credit facilities reflected $2.0 million reserved for two letters of credit and the remaining availability after the 2022 borrowing activity of $78.0 million under the Delayed Draw Facility.

Our products are sold to consumers through a fast-growing network of company-owned branded refrigerators, known as Freshpet Fridges, located in our customers’ stores. We continue to roll out Freshpet Fridges at leading retailers across North America and parts of Europe and have installed Freshpet Fridges in approximately 25,281 retail stores as of December 31, 2022.

We continue to roll out Freshpet Fridges at leading retailers across North America and parts of Europe and have installed Freshpet Fridges in approximately 26,777 retail stores as of December 31, 2023. Our products are sold under the Freshpet brand name with ingredients, packaging and labeling customized by class of retail.

The decrease in gross profit as a percentage of net sales was primarily due to increased plant start-up cost, inflation of ingredient cost and labor, and quality issues, partially offset by increased pricing, leverage on depreciation cost and prior year COVID-19 expenses.

The increase in gross profit as a percentage of net sales was primarily due to improved leverage on plant expenses, reduced quality costs, and decreased input cost as a percentage of sales mainly due to an increase in net sales pricing, partially offset by increased depreciation expense associated with the Company's capacity expansion and cost related to the disposal of equipment.

See Note 6 for additional details. 40 The following table sets forth, for the periods indicated, our working capital: December 31, December 31, 2022 2021 (Dollars in thousands) Cash and cash equivalents $ 132,735 $ 72,788 Accounts receivable, net of allowance for doubtful accounts 57,572 34,780 Inventories, net 58,290 35,574 Prepaid expenses 9,778 5,834 Other current assets 3,590 1,349 Accounts payable (55,088 ) (42,612 ) Accrued expenses (33,016 ) (14,950 ) Current operating lease liabilities (1,510 ) (1,384 ) Total Working Capital $ 172,351 $ 91,379 Working capital consists of current assets net of current liabilities.

Our inability to raise capital could impede our growth or otherwise require us to forego growth opportunities and could materially adversely affect our business, financial condition and results of operations. 34 The following table sets forth, for the periods indicated, our working capital: December 31, December 31, 2023 2022 (Dollars in thousands) Cash and cash equivalents $ 296,871 $ 132,735 Accounts receivable, net of allowance for doubtful accounts 56,754 57,572 Inventories, net 63,238 58,290 Prepaid expenses 7,615 9,778 Other current assets 2,841 3,590 Accounts payable (36,096 ) (55,088 ) Accrued expenses (49,816 ) (33,016 ) Current operating lease liabilities (1,312 ) (1,510 ) Current finance lease liabilities (1,998 ) - Total Working Capital $ 338,097 $ 172,351 Working capital consists of current assets net of current liabilities.

Interest Expense Interest expense relating to our Credit Facility increased $2.3 million to interest expense of $5.2 million for the twelve months ended December 31, 2022 as compared to an interest expense of $2.9 million for the prior year as a result of the Sixth Amendment and additional borrowings discussed in Note 6.

Interest Expense Interest expense increased $8.9 million to interest expense of $14.1 million for the twelve months ended December 31, 2023 as compared to interest expense of $5.2 million for the same period in the prior year.

Adjusted EBITDA Adjusted EBITDA was $20.1 million, or 3.4% as a percentage of net sales (also called Adjusted EBITDA Margin), for the twelve months ended December 31, 2022, compared to $35.0 million, or 8.2% as a percentage of net sales, in the prior year.

Net Loss Net loss decreased $25.9 million to a net loss of $33.6 million for the twelve months ended December 31, 2023 as compared to a net loss of $59.5 million for the prior year due to contribution from higher sales, increased gross margin and reduced logistics costs as a percentage of net sales, partially offset by increased SG&A including increased media spend of $23.1 million. 30 Adjusted EBITDA Adjusted EBITDA was $66.6 million, or 8.7% as a percentage of net sales (also called Adjusted EBITDA Margin), for the twelve months ended December 31, 2023, compared to $20.1 million, or 3.4% as a percentage of net sales, in the prior year.

As of the fourth quarter of 2021, all remaining COVID-19 expenses are part of our operating performance. EBITDA represents net income (loss) plus interest expense, income tax expense and depreciation and amortization.

EBITDA represents net income (loss) plus interest expense net of interest income, income tax expense and depreciation and amortization.

Net sales increased $169.9 million, or 39.9%, to $595.3 million for the twelve months ended December 31, 2022 as compared to the prior year. The $169.9 million increase in net sales was driven by growth in the Grocery (including Online), Mass, and Club refrigerated channel of $168.0 million, with the remaining growth in Pet Specialty and Natural.

The $171.6 million increase in net sales was driven by growth in the Grocery, Mass, and Club channel of $160.3 million, with the remaining growth in Pet Specialty and Natural.

(b) Represents implementation, amortization of deferred implementation costs and other costs associated with the implementation of an ERP system.

When such performance conditions are deemed to be improbable of achievement, the compensation cost previously recorded is reversed. (b) Represents implementation, amortization of deferred implementation costs and other costs associated with the implementation of an ERP system. (c) Represents fees associated with the Capped Call Transactions.

The decrease in adjusted gross profit as a percentage of net sales was primarily due to increased plant start-up cost, inflation of ingredient cost and labor, and quality issues, partially offset by increased pricing. See "—Non-GAAP Financial Measures" for how we define Adjusted Gross Profit, a reconciliation of Adjusted Gross Profit to gross profit, the closest comparable U.S.

See "—Non-GAAP Financial Measures" for how we define Adjusted Gross Profit, a reconciliation of Adjusted Gross Profit to gross profit, the closest comparable U.S. GAAP measure, certain limitations of Non-GAAP measures and why management has included such Non-GAAP measures.

We normally carry three to four weeks of finished goods inventory. As of December 31, 2022, the average duration of our accounts receivable is approximately 32 days.

We normally carry three to four weeks of finished goods inventory and less than 30 days of accounts receivable. For the year ended December 31, 2023 our capital resources consisted primarily of $296.9 million of cash and cash equivalents on hand.

The increase was primarily a result of an increase of $59.9 million in cash and cash equivalents as a result of our April 2022 primary offering as we fund our capital expansion plan, an increase in accounts receivable of $22.8 million due to increased sales, an increase in inventory of $22.7 million, and an increase in prepaid expenses of $3.9 million.

The increase was primarily a result of an increase of $164.1 million in cash and cash equivalents primarily resulting from the sale of the Convertible Notes as we fund our capital expansion plan, an increase in inventory of $4.9 million, a decrease in accounts payable of $19.0 million as a result of timing and capital expenditures of approximately $15.5 million related to our capital expansion plan and a decrease in current operating lease liabilities of $0.2 million.

Net Cash Provided by Financing Activities 2022 Net cash provided by financing activities of $336.5 million in 2022 was primarily attributed to: ● $337.5 million of proceeds from common shares issued in a primary offering, net of issuance cost. ● $78.0 million of proceeds from borrowings under Credit Facility. ● $0.5 million of proceeds from the exercise of stock options.

This was partially offset by: ● $19.8 million of proceeds from maturities of short-term investments. Net Cash Provided by Financing Activities 2023 Net cash provided by financing activities of $327.3 million in 2023 was primarily attributed to: ● $393.5 million net proceeds from Convertible Notes. ● $4.5 million cash proceeds from the exercise of stock options.

(d) Represents transition costs related to the organization changes designed to support growth, including several changes in organizational structure designed to enhance capabilities and support long-term growth objectives. 39 Liquidity and Capital Resources We expect to make future capital expenditures in connection with the completion of our planned development and of Freshpet Kitchens Ennis Phase 1, Ennis Phase 2, Ennis Chicken Processing and Freshpet Kitchens South.

(f) Represents a true-up to transition costs related to the organization changes designed to support growth, including several changes in organizational structure designed to enhance capabilities and support long-term growth objectives. 33 Liquidity and Capital Resources To meet our capital needs, we issued approximately $402.5 million in convertible notes in March 2023 (the "Convertible Notes"), used $66.2 million of the proceeds to enter into capped call transactions, and used $11.0 million of the proceeds on debt issuance related costs.

(b) Represents implementation, amortization of deferred implementation costs and other costs associated with the implementation of an ERP system.

At December 31, 2022, we had approximately $259.4 million of state NOLs, which expire between 2023 and 2041, and had $14.3 million of foreign NOLs which do not expire. At December 31, 2022, we had a full valuation allowance against our net deferred tax assets as the realization of such assets was not considered more likely than not.

At December 31, 2023, we had approximately $312.8 million of state NOLs, which expire between 2024 and 2043, and had $20.7 million of foreign NOLs in the United Kingdom which do not expire.

Net Loss Net loss increased $29.8 million to a net loss of $59.5 million for the twelve months ended December 31, 2022 as compared to a net loss of $29.7 million for the prior year due to increased SG&A, which includes increased media spend of $16.6 million and increased plant start-up cost of $21.2 million, partially offset by higher net sales and increased gross profit.

(2) Stores at December 31, 2023 and December 31, 2022 consisted of 5,164 and 5,135 pet specialty and 478 and 476 natural, respectively. Net sales increased $171.6 million, or 28.8%, to $766.9 million for the twelve months ended December 31, 2023 as compared to the prior year.

Removed

Recent Developments As part of the Company's increased focus on cash, we recently changed how we report Adjusted Gross Profit, Adjusted SG&A, and Adjusted EBITDA. Beginning for the period ended September 30, 2022, we no longer add back launch expenses and plant start-up expense in our calculation of our non-GAAP metrics.

Added

Components of our Results of Operations Net Sales Our net sales are derived from the sale of pet food products that are sold to retailers through broker and distributor arrangements. Our products are sold to consumers through a fast-growing network of company-owned branded refrigerators, known as Freshpet Fridges, located in our customers’ stores.

Removed

This change is reflective of our increased focus on cash, and we believe that this revised presentation will provide greater clarity on our path toward generating positive net income as the business scales further following the Company's planned capacity additions.

Added

The decrease of 330 basis points in SG&A as a percentage of net sales was mainly a result of reduced logistics cost as a percentage of net sales, decreased cost related to the ERP implementation, and increased leverage on depreciation and share-based compensation as the business scales, partially offset by activism engagement charges, increased media spend and increased variable compensation accrual.

Removed

The presentation for Adjusted Gross Profit, Adjusted SG&A, and Adjusted EBITDA for the prior year period and prior quarter period has been recast as shown below to reflect these changes to enhance comparability between periods.

Added

Interest and Other Income, net The Company recorded interest and other income, net of $13.0 million for the twelve months ended December 31, 2023 as a result of interest income generated from cash and short-term investments.

Removed

The impact of the change on an annual basis is as follows: FY 2022 FY 2021 FY 2020 (Dollars in thousands) Gross profit $ 186,033 $ 162,146 $ 132,910 Depreciation expense 20,774 16,545 9,576 Non-cash share-based compensation 7,293 4,152 2,132 COVID-19 expense (a) — 1,753 3,497 Adjusted Gross Profit $ 214,100 $ 184,596 $ 148,115 Adjusted Gross Profit as a % of Net Sales 36.0 % 43.4 % 46.5 % (a) Represents COVID-19 expenses including (i) costs incurred to protect the health and safety of our employees during the COVID-19 pandemic, (ii) temporary increased compensation expense to ensure continued operations during the pandemic, and (iii) costs related to mitigating potential supply chain disruptions during the pandemic included in cost of goods sold.

Added

The increase was primarily driven by the termination of our Credit Agreement in the current period resulting in the write-off of unamortized fees of $2.5 million which were recorded to interest expense, $5.2 million increase as a result of interest incurred on our Convertible Notes (as defined below) compared to interest incurred on the Credit Agreement that existed in the prior period, as well as a $1.2 million increase related to the interest on our finance lease liability.

Removed

As of the fourth quarter of 2021, all remaining COVID-19 related expenses are part of our operating performance. 27 FY 2022 FY 2021 FY 2020 (Dollars in thousands) SG&A expenses $ 238,016 $ 186,809 $ 134,908 Depreciation and amortization expense 13,781 13,923 11,549 Non-cash share-based compensation 18,799 20,846 8,793 Loss on disposal of equipment 396 1,000 1,805 Equity offering expenses (a) — — 58 Enterprise Resource Planning (b) 8,558 1,379 1,682 COVID-19 expense (c) — 5 357 Organization changes (d) 734 — — Adjusted SG&A Expenses $ 195,748 $ 149,656 $ 110,664 Adjusted SG&A Expenses as a % of Net Sales 32.9 % 35.2 % 34.7 % (a) Represents fees associated with public offerings of our common stock.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

8 edited+1 added−1 removed3 unchanged

2022 filing

2023 filing

Biggest changeSubstantial increases in costs and expenses could impact our operating results to the extent that such increases cannot be passed along to our customers. The impact of inflation on food, labor and energy costs can significantly affect the profitability of our Company as it has in 2022.

Biggest changeSubstantial increases in costs and expenses could impact our operating results to the extent that such increases cannot be passed along to our customers.

There can be no assurance that all future cost increases can be offset by increased prices or that increased prices will be fully absorbed without any resulting changes in their purchasing patterns. Foreign Exchange Rates Fluctuations in the currencies of countries where the Company operates outside the U.S. may impact our financial results.

There can be no assurance that all future cost increases can be offset by increased prices or that increased prices will be fully absorbed without any resulting changes in product purchasing patterns. Foreign Exchange Rates Fluctuations in the currencies of countries where the Company operates outside the U.S. may impact our financial results.

Historically, the foreign currency forward contracts have not been designated as hedges and, accordingly, any changes in their fair value are recognized on the Consolidated Statements of Operations and Comprehensive (Loss) in Other expenses, net, and carried at their fair value in the Consolidated Balance Sheet with gains reported in prepaid expenses and other current assets and losses reported in accrued expenses.

Historically, the foreign currency forward contracts have not been designated as hedges and, accordingly, any changes in their fair value are recognized on the Consolidated Statements of Operations and Comprehensive Loss in Interest and Other Income, net, and carried at their fair value in the Consolidated Balance Sheet with gains reported in prepaid expenses and other current assets and losses reported in accrued expenses.

The percentage of our consolidated revenue for the twelve months ended December 31, 2022 recognized in Europe was approximately 1%. The Company may, from time to time, enter into forward exchange contracts to reduce the Company's exposure to foreign currency fluctuations of certain assets and liabilities denominated in foreign currencies.

The percentage of our consolidated revenue for the twelve months ended December 31, 2023 recognized in Europe was approximately 1%. The Company may, from time to time, enter into forward exchange contracts to reduce the Company's exposure to foreign currency fluctuations of certain assets and liabilities denominated in foreign currencies.

While generally we have been able to offset inflation and other changes in the costs of key operating resources through price increases, productivity improvements and greater economies of scale, our price increases are not always done immediately causing us to temporarily absorb increased cost.

While generally we have been able to offset inflation and other changes in the costs of key operating resources through price increases, productivity improvements and greater economies of scale, our price increases are not always implemented immediately, which can cause us to temporarily absorb increased cost.

Further, there can be no assurance that we will be able to continue to do so in the future. From time to time, competitive conditions could limit our pricing flexibility. In addition, macroeconomic conditions could make additional price increases imprudent.

Further, there can be no assurance that we will be able to continue to effectively implement such offsets in the future. From time to time, competitive conditions could limit our pricing flexibility. In addition, macroeconomic conditions could make additional price increases imprudent.

As of December 31, 2022, we did not have any outstanding borrowings under our credit facilities. Commodity Price and Inflation Risk We purchase certain products and services that are affected by commodity prices and are, therefore, subject to price volatility caused by weather, market conditions and other factors which are not considered predictable or within our control.

Commodity Price and Inflation Risk We purchase certain products and services that are affected by commodity prices and are, therefore, subject to price volatility caused by weather, market conditions and other factors which are not considered predictable or within our control.

As of December 31, 2022, there were no forward contracts outstanding. 46

As of December 31, 2023, there were no forward contracts outstanding. 40

Removed

ITEM 7a. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS Interest Rate Risk We are sometimes exposed to market risks from changes in interest rates on debt and changes in commodity prices. Our exposure to interest rate fluctuations is limited to our outstanding indebtedness under our credit facilities, which bears interest at variable rates.

Added

ITEM 7a. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS Interest Rate Risk During periods of rising interest rates, our cost of borrowing could increase, the fair value of our investments could be affected, and it could constrain the purchasing power of our customers.

Top changes in Freshpet, Inc.'s 2023 10-K

Item 1. Business

Item 1A. Risk Factors

Item 2. Properties

Item 3. Legal Proceedings

Item 5. Market for Registrant's Common Equity

Item 7. Management's Discussion & Analysis

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Other FRPT 10-K year-over-year comparisons