Seneca Stock Rises Following Q1 Earnings Despite Sales Decline

Shares of Seneca Foods Corporation SENEA have gained 1.9% since the company reported its earnings for the quarter ended June 28, 2025. This compares to the S&P 500 Index’s 1.6% rise over the same period. Over the past month, the stock advanced 2.1%, matching the S&P 500’s 3.2% increase.

SENEA’s Earnings Snapshot

For the first quarter of fiscal 2026, Seneca reported net sales of $297.5 million, down 2.4% from $304.7 million in the prior-year period, reflecting lower sales volumes partially offset by higher selling prices and a favorable product mix. Net earnings rose 17.6% year over year to $14.9 million, or $2.14 per diluted share, from $12.7 million, or $1.80 per share, a year earlier. Operating income came in at $23.2 million, down 8.8% from $25.4 million in the same quarter last year, while gross margin edged up to 14.1% from 14%.

Segment-wise, Vegetable sales fell 3.2% to $270.3 million from $279.1 million, Fruit/Snack was down 0.5% at $21.6 million versus $21.7 million, and the “Other” category rose 41.3% to $5.6 million from $3.9 million, driven by seed, can and aircraft-related revenues.

Seneca’s Other Key Business Metrics

Interest expense dropped 47.7% to $5.4 million from $10.3 million, benefiting from lower average borrowings and a reduced weighted-average interest rate. Adjusted net earnings, which exclude LIFO inventory valuation credits, were $6 million, down 42.5% from $10.5 million in the prior-year quarter. EBITDA was $36.9 million, down 5.6% from $39.2 million, while FIFO EBITDA—a measure removing LIFO impacts—fell 30.5% to $25.2 million from $36.3 million.

Seneca continued to maintain a strong liquidity position, with $12.1 million in cash and access to $389.1 million in unused credit under its revolving facility.

Seneca Foods Corp. Price, Consensus and EPS Surprise

Seneca Foods Corp. price-consensus-eps-surprise-chart | Seneca Foods Corp. Quote

SENEA’s Management Commentary

President and CEO Paul Palmby acknowledged lingering cost pressures from high-cost 2024 inventory, stemming from unfavorable weather last summer, but expressed satisfaction with the quarter’s progress in selling through that inventory. Palmby also cited sales disruptions from a key co-pack customer that lowered volumes in the quarter, but indicated those volumes are expected to recover under the existing contract. Looking ahead, Palmby noted that the 2025 seasonal pack is underway, with expectations for a better growing season to normalize inventory levels and costs.

Factors Influencing Seneca’s Headline Numbers

The decline in sales was primarily volume-driven, with a $13.6 million decrease in volume partially offset by $6.4 million from pricing and product mix. Lower vegetable category sales—particularly canned and frozen—were due to volume losses that outweighed pricing gains. Fruit products suffered from weaker pricing and mix, while snacks benefited from higher volumes. The increase in “Other” revenues was linked to ancillary businesses such as seed, can manufacturing, and aircraft operations. Gross margin stability was aided by a larger LIFO credit ($11.8 million versus $2.9 million last year) that reduced cost of goods sold.

SENEA’s Guidance

While no formal quantitative guidance was issued, management signaled expectations for volume recovery from the co-pack customer and cost normalization from improved crop yields in the 2025 pack.

Seneca’s Other Developments

During the quarter, Seneca repurchased 41,937 shares of Class A Common Stock at a cost of $3.8 million. No Class B shares were repurchased.

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