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freshpet Freshpet , Inc. Reports Third Quarter 2021 Financial Results November 8 , 2021 Estimates Full Year Net Sales of $ 445 million Supply Chain Headwinds and Accelerating Inflation Reduce Adjusted EBITDA Guidance SECAUCUS , N.J. , Nov. 08 , 2021 ( GLOBE NEWSWIRE ) -- Freshpet , Inc. ( “ Freshpet ” or the “ Company ” ) ( Nasdaq : FRPT ) today reported financial results for its third quarter ended September 30 , 2021 . Third Quarter 2021 Financial Highlights Compared to Prior Year Period • Net sales of $ 107.6 million , an increase of 27.8 % • Net loss of $ 2.1 million , compared with prior year net income of $ 3.5 million • Adjusted EBITDA of $ 14.6 million , compared to prior year of $ 17.0 million 1 " Despite unprecedented supply chain challenges , Freshpet's long - term growth model remains intact , " commented Billy Cyr , Freshpet's Chief Executive Officer . " Like everyone else , we are facing extraordinary labor and material shortages , and accelerating inflation that have modestly delayed the start - up of new capacity and increased our costs more rapidly than we anticipated -- causing short - term challenges that we are addressing . However , the long - term trends driving Freshpet's growth remain strong , and thanks to our aggressive capacity expansion initiatives and the investments we made in maintenance , training and automation in Q3 -- we have never been better positioned to fulfill our mission of ' changing the way people nourish their pets forever ' than we are today . " Third Quarter 2021 Net sales increased 27.8 % to $ 107.6 million for the third quarter of 2021 compared to $ 84.2 million for the third quarter of 2020. Net sales for the third quarter of 2021 were driven by velocity , distribution gains , and innovation . Gross profit was $ 41.5 million , or 38.6 % as a percentage of net sales , for the third quarter of 2021 , compared to $ 36.7 million , or 43.5 % as a percentage of net sales , in the prior year period . For the third quarter of 2021 , Adjusted Gross Profit was $ 47.4 million , or 44.0 % as a percentage of net sales , compared to $ 41.5 million , or 49.3 % as a percentage of net sales , in the prior year period . The decrease in gross profit as a percentage of net sales and Adjusted Gross Profit as a percentage of net sales was primarily due to increased cost at our Freshpet Kitchens as a result of our wage increase plan , investments as we grow into capacity , inflation of ingredient cost and higher costs at our Freshpet Kitchens South partner . Adjusted Gross Profit is a non - GAAP financial measure defined under “ Non - GAAP Measures , " and is reconciled to gross profit in the financial tables that accompany this release . Selling , general and administrative expenses ( " SG & A ” ) were $ 42.4 million for the third quarter of 2021 compared to $ 32.9 million in the prior year period . As a percentage of net sales , SG & A increased to 39.4 % for the third quarter of 2021 compared to 39.1 % in the prior year period . Adjusted SG & A for the third quarter of 2021 was $ 32.8 million , or 30.4 % as a percentage of net sales , compared to $ 24.5 million , or 29.1 % as a percentage of net sales , in the prior year period . The increase in SG & A as a percentage of net sales and Adjusted SG & A as a percentage of net sales was a result of increased logistics costs , including freight costs , and higher employee - related costs , offset by general and administrative expense leverage due to higher net sales and decreased media as a percentage of net sales . Adjusted SG & A is a non - GAAP financial measure defined under " Non - GAAP Measures , " and is reconciled to SG & A in the financial tables that accompany this release . Net loss was $ 2.1 million for the third quarter of 2021 compared to net income of $ 3.5 million for the prior year period . The decrease in net income was due to increased SG & A partially offset by higher net sales and increased gross profit . Adjusted EBITDA was $ 14.6 million , or 13.6 % as a percentage of net sales , for the third quarter of 2021 , compared to $ 17.0 million , or 20.2 % as a percentage of net sales , in the prior year period . The decrease in Adjusted EBITDA was a result of increased Adjusted SG & A expense partially offset by higher net sales and Adjusted Gross Profit . Adjusted EBITDA is a non - GAAP financial measure defined under “ Non - GAAP Measures , " and is reconciled to net loss in the financial tables that accompany this release . 1 Adjusted EBITDA , as well as certain other measures in this release , is a non - GAAP financial measure . See " Non - GAAP Measures " for how we define these measures and the financial tables that accompany this release for reconciliations of these measures to the closest comparable GAAP measures . First Nine Months of 2021 Net sales increased 32.2 % to $ 309.6 million for the first nine months of 2021 compared to $ 234.3 million in the prior year period . Net sales for the first nine months of 2021 were driven by velocity , distribution gains , and innovation . Gross profit was $ 120.9 million , or 39.1 % as a percentage of net sales , for the first nine months of 2021 , compared to $ 102.4 million , or 43.7 % as a percentage of net sales , in the prior year period . For the first nine months of 2021 , Adjusted Gross Profit was $ 141.1 million , or 45.6 % as a percentage of net sales , compared to $ 115.4 million , or 49.3 % as a percentage of net sales , in the prior year period . The decrease in gross profit as a percentage of net sales and Adjusted Gross Profit as a percentage of net sales was primarily due to increased cost at our Freshpet Kitchens as a result of our wage increase plan , investments as we grow into capacity , inflation of ingredient cost and higher costs at our Freshpet Kitchens South partner . Adjusted Gross Profit is a non - GAAP financial measure defined under " Non - GAAP Measures , " and is reconciled to gross profit in the financial tables