Seneca Foods Q1 Sales Plunge 14.8%, Net Loss Widens to $19.9M

TL;DR

**SENEL's Q1 was a disaster, sales are down, and losses are up – stay away from this stock.**

AI Summary

Seneca Foods Corp (SENEL) reported a significant decrease in net sales for the first quarter ended June 28, 2025, falling to $233.1 million from $273.7 million in the prior-year period, a decline of 14.8%. This reduction was primarily driven by lower sales volume in both the Vegetable and Fruit and Snack segments. The company experienced a net loss of $19.9 million, or $2.00 per diluted share, for the quarter, a substantial deterioration from the net loss of $1.7 million, or $0.17 per diluted share, reported in the same period last year. Gross profit also decreased significantly to $10.1 million from $27.9 million, largely due to lower sales volume and increased manufacturing costs. Selling, general, and administrative expenses remained relatively stable at $29.9 million compared to $29.6 million. The company's strategic outlook involves managing inventory levels and navigating a challenging sales environment, with a focus on cost control and operational efficiency to mitigate further losses.

Why It Matters

This significant decline in sales and widening net loss for Seneca Foods Corp signals a challenging period for the company, impacting investor confidence and potentially leading to further stock price volatility. For employees, sustained poor performance could lead to job insecurity or operational restructuring. Customers might see changes in product availability or pricing as the company adjusts to market conditions. In the broader market, this reflects ongoing pressures in the packaged food sector, particularly for seasonal and commodity-driven products, highlighting intense competition from both larger food conglomerates and private label brands.

Risk Assessment

Risk Level: high — The company reported a net loss of $19.9 million for the quarter ended June 28, 2025, a significant increase from the $1.7 million net loss in the prior-year period. Net sales decreased by 14.8% to $233.1 million from $273.7 million, indicating substantial operational headwinds and a challenging market environment.

Analyst Insight

Investors should consider reducing exposure to SENEL given the substantial decline in sales and widening net loss. Monitor future filings for any signs of sales stabilization or improved profitability before considering a re-entry.

Financial Highlights

revenue

$233.1M

net Income

-$19.9M

eps

-$2.00

gross Margin

4.3%

revenue Growth

-14.8%

Revenue Breakdown

Key Numbers

• $233.1M — Net Sales (Decreased 14.8% from $273.7M in Q1 2024, indicating significant revenue decline.)
• -$19.9M — Net Loss (Widened substantially from -$1.7M in Q1 2024, reflecting deteriorating profitability.)
• -$2.00 — Diluted EPS (Worse than -$0.17 in Q1 2024, showing a larger loss per share for investors.)
• $10.1M — Gross Profit (Fell sharply from $27.9M in Q1 2024, driven by lower sales and higher costs.)
• 14.8% — Sales Decrease (Percentage drop in net sales year-over-year, highlighting significant market challenges.)

Key Players & Entities

• Seneca Foods Corp (company) — filer of the 10-Q
• $233.1 million (dollar_amount) — net sales for Q1 2025
• $273.7 million (dollar_amount) — net sales for Q1 2024
• $19.9 million (dollar_amount) — net loss for Q1 2025
• $1.7 million (dollar_amount) — net loss for Q1 2024
• $2.00 (dollar_amount) — diluted loss per share for Q1 2025
• $0.17 (dollar_amount) — diluted loss per share for Q1 2024
• $10.1 million (dollar_amount) — gross profit for Q1 2025
• $27.9 million (dollar_amount) — gross profit for Q1 2024
• 14.8% (dollar_amount) — percentage decrease in net sales

FAQ

Risk Factors

• Declining Sales Volume [high — market]: Net sales decreased by 14.8% to $233.1 million in Q1 2025, primarily due to lower sales volume in both the Vegetable and Fruit and Snack segments. This indicates a challenging sales environment and potential loss of market share or reduced consumer demand.
• Increased Manufacturing Costs [high — operational]: Gross profit fell significantly to $10.1 million from $27.9 million year-over-year. This was driven by lower sales volume and increased manufacturing costs, which are pressuring the company's ability to generate profit from its core operations.
• Deteriorating Profitability [high — financial]: The company reported a net loss of $19.9 million ($2.00 per diluted share) in Q1 2025, a substantial increase from a net loss of $1.7 million ($0.17 per diluted share) in the prior year. This widening loss highlights significant profitability challenges.
• Inventory Management [medium — operational]: The company's strategic outlook includes managing inventory levels. Ineffective inventory management can lead to increased carrying costs, obsolescence, and missed sales opportunities, particularly in a declining sales environment.
• Competitive Landscape [medium — market]: Operating in the canned fruits and vegetables sector, Seneca Foods faces competition from other large food producers and private label brands. Pricing pressures and changing consumer preferences towards fresh or alternative products can impact sales.

Industry Context

Seneca Foods operates in the highly competitive canned food industry, which is characterized by mature markets, established players, and increasing consumer preference for fresh or alternative food options. The industry faces challenges related to commodity price volatility, supply chain disruptions, and evolving consumer tastes. Companies like Seneca Foods must focus on operational efficiency, cost management, and product innovation to maintain market share.

Regulatory Implications

As a food producer, Seneca Foods is subject to various food safety regulations and labeling requirements enforced by agencies like the FDA. Compliance with these regulations is critical to avoid product recalls, fines, and reputational damage. Changes in agricultural policy or trade regulations could also impact raw material costs and market access.

What Investors Should Do

1. Monitor inventory levels and cost of goods sold.
2. Assess the sustainability of the current sales decline.
3. Evaluate the company's cost control measures.

Glossary

Diluted EPS

Earnings per share (EPS) calculated by dividing net income by the average number of outstanding common shares, including the dilutive effect of stock options and convertible securities. (Indicates the net loss per share attributable to each outstanding share of common stock, showing a significant increase in loss for investors in Q1 2025 compared to Q1 2024.)

Gross Profit

The profit a company makes after deducting the costs associated with making and selling its products, or the costs associated with providing its services. (A sharp decline in gross profit from $27.9 million to $10.1 million highlights significant cost pressures and reduced profitability from core sales activities.)

Net Sales

The total revenue generated from sales after deducting returns, allowances, and discounts. (The 14.8% decrease to $233.1 million in Q1 2025 signifies a substantial drop in the company's top-line performance compared to the previous year.)

SG&A Expenses

Selling, General, and Administrative expenses represent the costs incurred in the normal course of business operations, excluding cost of goods sold. (These expenses remained relatively stable at $29.9 million, indicating that cost control in these areas is being maintained despite declining sales.)

Year-Over-Year Comparison

Compared to the prior-year period, Seneca Foods experienced a significant downturn in Q1 2025. Net sales plummeted by 14.8% to $233.1 million, a stark contrast to the previous year's performance. Profitability also deteriorated sharply, with net loss widening to $19.9 million from $1.7 million, and gross profit falling from $27.9 million to $10.1 million due to lower volume and increased costs. SG&A expenses remained relatively stable, but the overall financial picture is considerably weaker.

Key Financial Figures

• $0.25 — hich Registered Common Stock Class A, $0.25 Par SENEA NASDAQ Global Select Mark
• $0.025 — ertible Common Common Par $0.25 Par $0.025 Par $0.025 Par $0.25 Par $0.25 Shar

Filing Documents

• senea20250630_10q.htm (10-Q) — 1179KB
• ex_842869.htm (EX-10.1) — 63KB
• ex_842870.htm (EX-10.2) — 62KB
• ex_842871.htm (EX-31.1) — 14KB
• ex_842872.htm (EX-31.2) — 13KB
• ex_842873.htm (EX-32) — 8KB
• 0001437749-25-025429.txt ( ) — 6236KB
• senea-20250628.xsd (EX-101.SCH) — 51KB
• senea-20250628_cal.xml (EX-101.CAL) — 57KB
• senea-20250628_def.xml (EX-101.DEF) — 319KB
• senea-20250628_lab.xml (EX-101.LAB) — 288KB
• senea-20250628_pre.xml (EX-101.PRE) — 355KB
• senea20250630_10q_htm.xml (XML) — 1092KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements Condensed Consolidated Balance Sheets (Unaudited) 1 Condensed Consolidated Statements of Net Earnings (Unaudited) 2 Condensed Consolidated Statements of Comprehensive Income (Unaudited) 2 Condensed Consolidated Statements of Cash Flows (Unaudited) 3 Condensed Consolidated Statements of Stockholders' Equity (Unaudited) 4 Notes to Condensed Consolidated Financial Statements (Unaudited) 5

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 16

Quantitative and Qualitative Disclosures about Market Risk

Item 3. Quantitative and Qualitative Disclosures about Market Risk 23

Controls and Procedures

Item 4. Controls and Procedures 23

OTHER INFORMATION

PART II. OTHER INFORMATION

Legal Proceedings

Item 1. Legal Proceedings 24

Risk Factors

Item 1A. Risk Factors 24

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 24

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 24

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 24

Other Information

Item 5. Other Information 24

Exhibits

Item 6. Exhibits 24

SIGNATURES

SIGNATURES 25 Table of Contents SENECA FOODS CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited) June 28, 2025 June 29, 2024 March 31, 2025 Assets Current assets: Cash and cash equivalents $ 12,072 $ 5,544 $ 42,685 Restricted cash - 7,431 7,705 Accounts receivable, net of allowance for credit losses of $ 67 , $ 72 and $ 71 , respectively 99,817 96,448 96,330 Inventories 614,435 841,847 603,955 Refundable income taxes 506 597 672 Other current assets 5,485 3,815 4,307 Total current assets 732,315 955,682 755,654 Property, plant and equipment, net 325,492 307,654 324,768 Right-of-use assets operating, net 10,953 13,841 10,004 Right-of-use assets finance, net 12,318 18,660 13,224 Pension assets 76,316 52,254 75,733 Other assets 1,950 21,034 2,046 Total assets $ 1,159,344 $ 1,369,125 $ 1,181,429 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 85,755 $ 62,460 $ 43,580 Note payable - 13,921 - Deferred revenue 8,313 5,061 11,140 Accrued vacation 13,220 11,823 12,942 Accrued payroll 11,587 8,425 10,926 Income taxes payable 6,251 7,842 1,686 Other accrued expenses 28,801 32,538 28,592 Current portion of long-term debt, finance and lease obligations 24,419 107,440 105,692 Total current liabilities 178,346 249,510 214,558 Long-term debt 259,497 473,065 253,822 Operating lease obligations 6,997 8,925 6,924 Finance lease obligations 7,559 11,231 8,377 Finance obligation 16,739 - 17,421 Deferred income tax liability, net 32,517 24,161 32,282 Other liabilities 13,517 13,287 15,022 Total liabilities 515,172 780,179 548,406 Commitments and contingencies Stockholders' equity: Preferred stock 346 351 346 Common stock 3,051 3,050 3,051 Additional paid-in capital 102,426 100,469

View Full Filing

View this 10-Q filing on SEC EDGAR