VANCOUVER, BC, Nov. 5, 2026 /CNW/ -- Premium Brands Holdings Corporation (TSX: PBH), a leading producer, marketer and distributor of branded specialty food products, announced today its results for the third quarter of 2026.

QUARTER HIGHLIGHTS

• Record third quarter revenue from continuing operations of $2.4 billion, up 22.0%, or $429.1 million, from the third quarter of 2025

• Solid progress on Specialty Foods' core U.S. protein products growth initiatives which for the quarter generated organic volume growth of $54.6 million representing an organic volume growth rate of 13.9%

• Record third quarter adjusted EBITDA¹ from continuing operations of $213.0 million representing a 21.6%, or $37.9 million, increase as compared to the third quarter of 2025

• Record third quarter adjusted EPS¹ from continuing operations of $1.38 per share representing a 7.8%, or $0.10 per share, increase as compared to the third quarter of 2025

• Recently acquired Stampede Culinary Partners generated solid year over year growth for the quarter but missed planned sales and adjusted EBITDA targets by $19.6 million and $12.0 million, respectively due to reduced consumer foot traffic and spending in the foodservice channel, and a delay in realizing savings from new imported beef procurement initiatives

• Record third quarter steady state free cash flow and steady state free cash flow per share of $114.8 million and $2.20 per share, respectively

• Third quarter net free cash flow of $195.5 million

• Declared a dividend of $0.85 per common share for the fourth quarter of 2026

• Total debt-to-EBITDA ratio decreased to 3.6 to 1 from 3.8 to 1 in the previous quarter and 4.3 to 1 at the start of the year

• Subsequent to the quarter, put into place a normal course issuer bid under which the Company is authorized to purchase for cancellation up to 1,000,000 common shares, representing approximately 1.9% of its issued and outstanding common shares

• Also subsequent to the quarter, completed the sale of a minority interest in a Washington based baked goods business for US$28.0 million or approximately $39.1 million

• Initiatives to generate more than $1.0 billion from investment and asset monetization are progressing ahead of plan

• Also subsequent to the quarter, entered into a knock-in style collar interest rate swap that matures in November 2029 and limits the Company's exposure to increases in SOFR on US$700.0 million of its debt to a maximum rate of 5.0% plus the Company's applicable credit spread, while allowing it to take advantage of floating interest rates within a specified range, with a floor rate of 4.0% if SOFR falls below 3.8%

QUESTIONS AND ANSWERS SESSION

The Company will hold a Q&A session on its third quarter 2026 results today at 2:30 p.m. Vancouver time (4:30 p.m. Toronto Time). Management's pre-recorded remarks and an investor presentation that will be referenced on the conference call are available here or by navigating through the Company's website at www.premiumbrandsholdings.com.

Access to the Q&A session may be obtained by calling the operator at (647) 932-3411 / (800) 715-9871 (Conference ID: 4376728#) up to ten minutes prior to the scheduled start time. For those who are unable to participate, a recording of the conference call will be available through to 11:59 p.m. Toronto time on December 4, 2026 at (647) 362-9199 / (800) 770-2030 (passcode: 4376728#). Alternatively, a recording of the conference call will be available on the Company's website at www.premiumbrandsholdings.com.

SUMMARY FINANCIAL INFORMATION
(In millions of dollars except per share amounts and ratios)

"While we continued to generate record results, the third quarter also saw substantial improvement in our net free cash flow and further deleveraging of our balance sheet," said Mr. George Paleologou, President and CEO. "Over the last four years we have invested heavily in positioning our company as a key supplier of premium food products to retail, club and foodservice customers across North America, including allocating over $1 billion to build out a world class U.S. based manufacturing footprint to support our growth. With this spend now nearly complete and our various growth initiatives taking hold, we are starting to show significant progress on these metrics with our net free cash flow for the quarter growing to $195 million versus an outflow of $45 million in the third quarter of last year, and our total debt-to-EBITDA ratio falling to 3.6 to 1 from 4.3 to 1 at the start of the year.

"Our previously announced initiative to generate more than $1.0 billion from investment and asset monetization is progressing well and is ahead of plan. During the quarter we made solid progress on several projects including the sale of our minority interest in a Washington based baked goods company, which we closed after the quarter resulting in proceeds of approximately $39 million," stated Mr. George Paleologou. "Supported by these proceeds and the growth in our net free cash flow, we have started buying back our shares, which we believe trade at a substantial discount to their intrinsic value. Looking forward, as our monetization initiatives progress and growth in our net free cash flow accelerates, we expect to allocate an increasing amount of capital to share buybacks," added Mr. Paleologou.

"Our organic volume growth rate slowed during the quarter; however, we expect it to reaccelerate in the coming quarters, supported by a robust business development pipeline. Our diverse portfolio of best-in-class premium branded and private label food products caters to three mega food trends: high in protein, convenience and premiumization. Together with our innovation capabilities and new state-of-the-art production capacities, we are very well positioned to continue the growth journey we began just over 20 years ago.

"On the acquisitions front, we are in ongoing discussions on several very attractive opportunities, however, any transaction we do must meet two specific conditions. It must be more accretive to our shareholders than buying back our own stock, and it must be done within the context of continuing to strengthen our financial position," stated Mr. Paleologou.

FOURTH QUARTER 2026 DIVIDEND

The Company also announced that its Board of Directors approved a cash dividend of $0.85 per common share for the fourth quarter of 2026, which will be payable on January 15, 2027 to shareholders of record at the close of business on December 31, 2026.

Unless indicated otherwise in writing at or before the time the dividend is paid, each dividend paid by the Company in 2026 or a subsequent year is an eligible dividend for the purposes of the Enhanced Dividend Tax Credit System.

ABOUT PREMIUM BRANDS

Premium Brands owns a broad range of leading specialty food manufacturing and differentiated food distribution businesses with operations across Canada and the United States.

www.premiumbrandsholdings.com

RESULTS OF OPERATIONS

The Company reports on two reportable segments, Specialty Foods (SF) and Premium Food Distribution (PFD), as well as non-segmented investment income and corporate costs (Corporate). The Specialty Foods segment consists of the Company's specialty food manufacturing businesses while the Premium Food Distribution segment consists of the Company's differentiated distribution and wholesale businesses as well as certain seafood processing businesses. Investment income includes interest and management fees generated from the Company's businesses that are accounted for using the equity method.

As part of the realignment of certain businesses and management responsibilities, starting in fiscal 2026 the Company reclassified certain businesses from the Premium Food Distribution segment to the Specialty Foods segment. Accordingly, segmented information for the comparative period has been retrospectively restated.

As a result of the sale of the Company's Shaw Bakers business on April 24, 2026 and the planned sale of its Duso's business, it has retroactively presented the operations of these businesses as discontinued operations in accordance with IFRS Accounting Standards. Correspondingly, these discontinued operations no longer contribute to revenue or earnings from continuing operations. Management believes this accounting method for these businesses enhances the comparability and relevance of current period operating results by allowing readers of the press release to independently evaluate the Company's continuing operations.

Revenue

Specialty Foods' revenue for the quarter increased by $406.2 million or 31.6% primarily due to: (i) business acquisitions, which generated $349.6 million in growth; (ii) selling price increases of $31.5 million, which were primarily in response to higher beef raw material costs; (iii) organic volume growth of $17.2 million representing an organic volume growth rate (OVGR) of 1.3%; and (iv) a $7.9 million increase in the translated value of sales generated by SF's U.S. based businesses due to a weaker Canadian dollar.

SF's OVGR of 1.3% was driven by a variety of initiatives in the U.S. which generated net organic volume growth of $19.9 million, representing a U.S. sales OVGR of 2.5%. This consisted of 13.9% OVGR generated by its U.S. protein based initiatives partially offset by an 8.3% OVGR contraction in its U.S. Custom Culinary Solutions initiatives, mainly in the sandwich category. 

The 2.5% U.S. sales OVGR was lower than the 10.7% comparable rate in the previous quarter mainly because of lower sales in the foodservice and convenience store channels resulting from several factors. These included the timing of promotions, and a more challenging consumer environment that resulted in reduced traffic and spending in certain customers' stores or restaurants. The delay of several new sandwich product launches also contributed to SF's lower U.S. sales OVGR in the quarter. Looking ahead (see Forward Looking Statements), the Company expects its U.S. sales OVGR to return to double digit levels in 2027 driven by a variety of new cooked protein, meat stick and sandwich initiatives. 

SF's sales volumes in Canada were relatively flat with the benefits of new product launches and consumers shifting their spending from the foodservice channel to the retail channel being offset by a general increase in consumer price sensitivity.

SF's revenue for the first three quarters of 2026 increased by $1,239.2 million or 33.4% primarily due to: (i) business acquisitions, which generated $984.6 million in growth; (ii) organic volume growth of $163.8 million representing an OVGR of 4.4%; and (iii) selling price increases of $103.5 million. These factors were partially offset by a $12.7 million decrease in the translated value of sales generated by SF's U.S. based businesses due to a stronger Canadian dollar.

Premium Food Distribution's revenue for the quarter increased by $22.9 million or 3.5% due to: (i) selling price increases of $19.0 million, which were primarily in response to higher beef raw material costs; (ii) organic volume growth of $3.4 million representing an organic volume growth rate of 0.5%; and (iii) a $0.5 million increase in the translated value of sales generated by PFD's U.S. based businesses due to a weaker Canadian dollar. 

PFD's OVGR of 0.5% was driven by strong sales of lobster products due to an improved Canadian fishery, partially offset by lower foodservice channel sales resulting from a more challenging consumer environment.

PFD's revenue for the first three quarters of 2026 increased by $90.0 million or 5.1% primarily due to: (i) selling price increases of $65.4 million; and (ii) organic volume growth of $25.8 million representing an OVGR of 1.5%. These increases were partially offset by a $1.2 million decrease in the translated value of sales generated by PFD's U.S. based businesses due to a stronger Canadian dollar.

Gross Profit

SF's gross profit as a percentage of its revenue (gross margin) for the quarter decreased by 150 basis points primarily due to the acquisition of Stampede Culinary Partners, which has a lower gross margin as compared to the average of SF's legacy businesses - excluding acquisitions, SF's gross margin for the quarter was 21.0%. This was partially offset by the implementation of selling price increases to address the impact of higher raw material costs and general cost inflation.

SF's gross margin for the first three quarters of 2026 decreased by 100 basis points primarily due to the acquisition of Stampede and increased plant overhead costs associated with new capacity investments and adding production shifts at several facilities. These factors were partially offset by: (i) the implementation of selling price increases to address the impact of higher raw material costs and general cost inflation; and (ii) sales leveraging benefits associated with SF's organic volume growth.

PFD's gross margin for the quarter decreased by 30 basis points primarily due to the impact of commodity cost inflation (mainly on beef products) as PFD's businesses generally focused on recovery of gross profit dollars due to the severity of the cost inflation combined with a more challenging consumer environment impacting certain segments of the foodservice channel.

PFD's gross margin for the first three quarters of 2026 decreased by 80 basis points primarily due to the same factors that impacted the current quarter, and in the first quarter of 2026 a year-over-year reduction in margins on lobster products resulting from a combination of high shore purchase prices and consumer price sensitivity.

Selling, General and Administrative Expenses (SG&A)

SF's SG&A as a percentage of sales (SG&A ratio) for the quarter and for the first three quarters of 2026 decreased by 130 basis points and 120 basis points, respectively, primarily due to: (i) the acquisition of Stampede Culinary Partners, which has a lower SG&A ratio as compared to the average of SF's legacy businesses; and (ii) sales growth leverage. These factors were partially offset by an increase in promotional activity in the first quarter of 2026 and freight cost inflation in the third quarter of 2026.

PFD's SG&A ratio for the quarter and for the first three quarters of 2026 was relatively consistent with the comparable prior year periods due to the impact of freight and general cost inflation offsetting the benefits of sales growth leverage and lower discretionary compensation accruals.

Adjusted EBITDA ⁽¹⁾

Plant Start-up and Restructuring Costs

Plant start-up and restructuring costs consist of expenses associated with: (i) the start-up of new production capacity; (ii) the reconfiguration of existing capacity to gain efficiencies and/or additional capacity; and/or (iii) the restructuring of a business to improve its profitability. The Company expects these investments to result in improvements in its future earnings and cash flows (see Forward Looking Statements).

During the quarter, the Company incurred $9.5 million in plant start-up and restructuring costs relating primarily to: (i) the ramp up of production of a new line of sandwiches at SF's Shannon, MS plant which launched late in the quarter; (ii) the transfer of cooked protein production to SF's recently renovated Owasso, OK plant; and (iii) the start up of a new kettle cooking line at SF's Auburn, ME facility.

Equity Earnings (Losses) from Investments in Associates

Equity earnings (losses) from investments in associates includes the Company's proportionate share of the earnings and losses of its investments in associates.

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