Central Garden & Pet : Non-GAAP Reconciliation Q2 2026

Published: 2026-05-06 19:24:42 ET CENT

Published on 05/06/2026 at 07:24 pm EDT - Modified on 05/06/2026 at 07:37 pm EDT

We report our financial results in accordance with GAAP. However, to supplement the financial results prepared in accordance with GAAP, we use non-GAAP financial measures including non-GAAP net income and diluted net income per share, non-GAAP operating income, and adjusted EBITDA. Management uses these non-GAAP financial measures that exclude the impact of specific items (described below) in making financial, operating and planning decisions and in evaluating our performance. Also, management believes that these non-GAAP financial measures may be useful to investors in their assessment of our ongoing operating performance and provide additional meaningful comparisons between current results and results in prior operating periods. While management believes that non-GAAP measures are useful supplemental information, such adjusted results are not intended to replace our GAAP financial results and should be read in conjunction with those GAAP results.

Adjusted EBITDA is defined by us as income before income tax, net other expense, net interest expense and depreciation and amortization and stock-based compensation expense (or operating income plus depreciation and amortization expense and stock-based compensation expense). Adjusted EBITDA further excludes charges related to facility closures. We present adjusted EBITDA because we believe that adjusted EBITDA is a useful supplemental measure in evaluating the cash flows and performance of our business and provides greater transparency into our results of operations. Adjusted EBITDA is used by our management to perform such evaluations. Adjusted EBITDA should not be considered in isolation or as a substitute for cash flow from operations, income from operations or other income statement measures prepared in accordance with GAAP. We believe that adjusted EBITDA is frequently used by investors, securities analysts and other interested parties in their evaluation of companies, many of which present adjusted EBITDA when reporting their results. Other companies may calculate adjusted EBITDA differently and it may not be comparable.

The reconciliations of these non-GAAP measures to the most directly comparable financial measures calculated and presented in accordance with GAAP are shown in the tables below.

Non-GAAP financial measures reflect adjustments based on the following items:

Facility closures and business exit: we have excluded charges related to the closure of distribution and manufacturing facilities and our decisions to exit businesses as they represent infrequent transactions that impact the comparability between operating periods. We believe these exclusions supplement the GAAP information with a measure that may be useful to investors in assessing the sustainability of our operating performance.

Tax impact: adjustment represents the impact of the tax effect of the pre-tax non-GAAP adjustments excluded from non-GAAP net income. The tax impact of the non-GAAP adjustments is calculated based on the consolidated effective tax rate on a GAAP basis, applied to the non-GAAP adjustments.

From time to time in the future, there may be other items that we may exclude if we believe that doing so is consistent with the goal of providing useful supplemental information to investors and management.

We have not provided a reconciliation of non-GAAP measures to the corresponding GAAP measures on a forward-looking basis as we cannot do so without unreasonable efforts due to the potential variability and limited visibility of excluded items; these excluded items may include facility closures and exit costs, impairment charges and restructuring costs, among others.

During the first quarter of fiscal 2026, we recognized incremental expense of $7.7 million in the consolidated statement of operations, of which $7.2 million in our Garden segment related to the closure of three distribution centers in fiscal 2025 and 2024. During the first and second quarters of fiscal 2026, we recognized incremental expense of $0.5 million and $0.2 million, respectively, in our Pet segment related to the closure of a sales and logistics facility in Pennsylvania.

During the second quarter of fiscal 2025, we recognized incremental expense of $5.3 million in the consolidated statement of operations, related to the decision to wind-down our operations in the U.K. and the related facility there as we move to a direct-export model.

Net Income and Diluted Net Income Per Share

GAAP to Non-GAAP Reconciliation

Three Months Ended

Six Months Ended

March 28, 2026

March 29, 2025

March 28, 2026

March 29, 2025

(in thousands, except per share amounts)

GAAP net income attributable to Central Garden & Pet Company

$ 79,421

$ 63,633

$ 86,262

$ 77,642

Facility closures

(1) (2)

227

5,339

7,972

5,339

Tax effect of adjustments

(53)

(1,255)

(1,870)

(1,255)

Non-GAAP net income attributable to Central Garden & Pet Company

$ 79,595

$ 67,717

$ 92,364

$ 81,726

GAAP diluted net income per share

$ 1.28

$ 0.98

$ 1.39

$ 1.19

Non-GAAP diluted net income per share

$ 1.29

$ 1.04

$ 1.49

$ 1.25

Shares used in GAAP and non-GAAP diluted net earnings per share calculation

61,869

64,879

61,937

65,171

Operating Income

GAAP to Non-GAAP Reconciliation

Three Months Ended March 28, 2026

Six Months Ended March 28, 2026

GAAP

Non-GAAP

adjustments(1)

Non-GAAP

GAAP

Non-GAAP

adjustments(1)

Non-GAAP

(in thousands)

Net sales

$ 906,152

$ -

$ 906,152

$ 1,523,525

$ -

$ 1,523,525

Cost of goods sold

606,588

606,503

1,033,353

(517)

1,033,870

Gross profit

$ 299,564

$ (85)

$ 299,649

$ 490,172

$ 517

$ 489,655

Selling, general and administrative expenses

185,628

142

185,486

359,703

8,489

351,214

Income from operations

$ 113,936

$ (227)

$ 114,163

$ 130,469

$ (7,972)

$ 138,441

Gross margin

33.1%

32.2%

32.1%

Operating margin

12.6%

8.6%

9.1%

Operating Income

GAAP to Non-GAAP Reconciliation

Three Months Ended March 29, 2025

Six Months Ended March 29, 2025

GAAP

Non-GAAP

adjustments(2)

Non-GAAP

GAAP

Non-GAAP

adjustments(2)

Non-GAAP

(in thousands)

Net sales

$ 833,537

$ -

$ 833,537

$ 1,489,973

$ -

$ 1,489,973

Cost of goods sold

560,454

4,413

556,041

1,021,191

4,413

1,016,778

Gross profit

$ 273,083

$ (4,413)

$ 277,496

$ 468,782

$ (4,413)

$ 473,195

Selling, general and administrative expenses

179,759

926

178,833

347,466

926

346,540

Income from operations

$ 93,324

$ (5,339)

$ 98,663

$ 121,316

$ (5,339)

$ 126,655

Gross margin

32.8%

33.3%

31.5%

31.8%

Operating margin

11.2 %

11.8 %

8.1%

8.5%

Pet Segment Operating Income

GAAP to Non-GAAP Reconciliation

Three Months Ended

Six Months Ended

March 28, 2026

March 29, 2025

March 28, 2026

March 29, 2025

(in thousands)

GAAP operating income

$ 77,822

$ 60,614

$ 127,622

$ 111,871

Facility closures

(1) (2)

227

5,339

732

5,339

Non-GAAP operating income

$ 78,049

$ 65,953

$ 128,354

$ 117,210

GAAP operating margin

16.3%

13.4%

14.3%

12.7%

Non-GAAP operating margin

16.4%

14.5%

14.4%

13.3%

Garden Segment Operating Income

GAAP to Non-GAAP Reconciliation

Three Months Ended

Six Months Ended

March 28, 2026

March 29, 2025

March 28, 2026

March 29, 2025

(in thousands)

GAAP operating income

$ 65,968

$ 58,731

$ 56,289

$ 61,154

Facility closures

(1)

7,240

Non-GAAP operating income

$ 65,968

$ 58,731

$ 63,529

$ 61,154

GAAP operating margin

15.4%

15.5%

8.9%

10.0%

Non-GAAP operating margin

15.4%

15.5%

10.1%

10.0%

Adjusted EBITDA

GAAP to Non-GAAP Reconciliation

Three Months Ended March 28, 2026

Pet

Garden

Corporate

Total

(in thousands)

Net income attributable to Central Garden & Pet Company

$ -

$ 79,421

Interest expense, net

9,084

Other expense

351

Income tax expense

24,529

Net income attributable to noncontrolling interest

551

Income (loss) from operations

77,822

65,968

(29,854)

$ 113,936

Depreciation & amortization

10,462

9,991

231

20,684

Noncash stock-based compensation

4,629

Facility closures

(1)

227

Adjusted EBITDA

$ 88,511

$ 75,959

$ (24,994)

$ 139,476

Adjusted EBITDA

GAAP to Non-GAAP Reconciliation

Three Months Ended March 29, 2025

Garden

Corporate

Total

(in thousands)

Net income attributable to Central Garden & Pet Company

$ -

$ 63,633

Interest expense, net

9,358

Other income

(744)

Income tax expense

19,903

Net income attributable to noncontrolling interest

1,174

Income (loss) from operations

60,614

58,731

(26,021)

$ 93,324

Depreciation & amortization

9,498

10,443

705

20,646

Noncash stock-based compensation

4,018

Facility closures & business exit

(2)

5,339

Adjusted EBITDA

$ 75,451

$ 69,174

$ (21,298)

$ 123,327

Adjusted EBITDA

GAAP to Non-GAAP Reconciliation

Six Months Ended March 28, 2026

Pet

Garden

Corporate

Total

(in thousands)

Net income attributable to Central Garden & Pet Company

$ -

$ 86,262

Interest expense, net

16,851

Other expense

169

Income tax expense

26,618

Net income attributable to noncontrolling interest

569

Income (loss) from operations

127,622

56,289

(53,442)

$ 130,469

Depreciation & amortization

20,599

20,265

480

41,344

Noncash stock-based compensation

9,454

Facility closures

(1)

732

7,240

7,972

Adjusted EBITDA

$ 148,953

$ 83,794

$ (43,508)

$ 189,239

Adjusted EBITDA

GAAP to Non-GAAP Reconciliation

Six Months Ended March 29, 2025

Pet

Garden

Corporate

Total

(in thousands)

Net income attributable to Central Garden & Pet Company

$ -

$ 77,642

Interest expense, net

17,088

Other expense

973

Income tax expense

24,267

Net income attributable to noncontrolling interest

1,346

Income (loss) from operations

111,871

61,154

(51,709)

$ 121,316

Depreciation & amortization

19,578

21,574

1,428

42,580

Noncash stock-based compensation

9,528

Facility closures and business exit

(2)

5,339

Adjusted EBITDA

$ 136,788

$ 82,728

$ (40,753)

$ 178,763

Disclaimer

Central Garden & Pet Company published this content on May 06, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 06, 2026 at 23:03 UTC.