On August 25, The Marzetti Company (NASDAQ:MZTI) closed out a fiscal 12 months of information, even as reported quarterly gross sales slipped 2.2% to $465.0 million. The drop traces to the deliberate expiration of a short-term provide settlement rather than any softness in the core business, and once that noise is stripped out, adjusted gross sales really grew. Behind the headline quantity sits a company producing more money and revenue than it ever has, just as a recent food security scare threatens to interrupt the streak.
Twelve Straight Quarters Of Margin Gains
Fiscal 2026 marked the fourth straight 12 months of file web gross sales and gross revenue and the third straight 12 months of file working income, with fourth-quarter gross revenue alone reaching $114.0 million. Gross margin expanded 220 foundation factors to 24.5%, the twelfth consecutive quarter of enchancment, as procurement, manufacturing and community adjustments stored squeezing out prices. Adjusted working income rose 17.5% to $52.2 million. Growth is more and more coming from newer names. Bachan’s, the barbecue sauce model acquired mid-year, added $15.4 million in gross sales in its first two months and contributed 320 foundation factors to consolidated growth. Scanner knowledge confirmed Bachan’s gross sales up 8.7% for the quarter with distribution factors up 16.6%, and family penetration climbing from 5% to 6% since the deal closed.
Management is now extending the model into mayo, a class it pegs at $3.4 billion in potential, and into a wing sauce made at its own Kentucky plant. Texas Roadhouse dinner rolls stored up an even quicker tempo, up 28.1% in the quarter and 76% for the 12 months to $58 million, promoting almost twice as fast per distribution level as the class average. New York Bakery grew 2.8% and took 220 foundation factors of share to a main 45.5%, while branded croutons picked up another 100 foundation factors. Record working money move of $283.8 million helped fund $36.3 million in buybacks and a 63rd straight annual dividend increase.
A Bug Bites Into The Numbers
That momentum is about to run into a actual headwind. A Cyclospora outbreak is expected to cut fiscal first-quarter web gross sales by roughly 250 foundation factors in both the retail and foodservice segments, and management is modeling the restoration on a comparable 2018 episode that took about 4 months to fade. CFO Tom Pigott was blunt about the near-term price, saying the company does “not expect to be able to grow our margins” in the first quarter, and Marzetti is guiding to a roughly 15% decline in first-quarter working income.