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Press Release: BellRing Brands Reports Results -4-

· 02/04/2021 17:00
Three Months Ended December 31, ---------------------------- 2020 2019 ----------------- --------- Net Earnings Available to Class A Common Stockholders $ 7.8 $ 6.0 Income tax expense 2.1 5.9 Interest expense, net 12.8 11.6 Depreciation and amortization, including accelerated depreciation and amortization 6.7 6.4 NCI adjustment 25.1 25.8 Restructuring and facility closure costs, excluding accelerated depreciation and amortization 4.6 -- Stock-based compensation 1.9 1.4 Separation costs -- 1.5 Foreign currency gain on intercompany loans (0.3) -- --------- ----- Adjusted EBITDA $ 60.7 $58.6 ===== ==== Adjusted EBITDA as a percentage of Net Sales 21.5 % 24.0% ========= =====October 21, 2019 Three Months Ended to December 31, 2020 December 31, 2019 Diluted Earnings per share of Class A Common Stock $ 0.20 $ 0.15 Adjustments: Restructuring and facility closure costs, including accelerated depreciation and amortization 0.13 -- NCI adjustment (0.09) -- Separation costs after the IPO -- 0.01 Foreign currency gain on intercompany loans (0.01) -- ----------------- -------------------- Total Net Adjustments 0.03 0.01 Income tax effect on adjustments (1) -- -- ----------------- --- -------------------- Adjusted Diluted Earnings per share of Class A Common Stock $ 0.23 $ 0.16 (1) For the three months ended December 31, 2020, the income tax effect was calculated using a rate of 7.0%, which represents the effective income tax rate on BellRing's 28.8% distributive share. For the October 21, 2019 to December 31, 2019 period, the income tax effect was calculated using a rate of 0.0%, as the amounts were primarily non-deductible separation costs for income tax purposes.October 21, 2019 Three Months Ended to December 31, 2020 December 31, 2019 Net Earnings Available to Class A Common Stockholders $ 7.8 $ 6.0 Adjustments: Restructuring and facility closure costs, including accelerated depreciation and amortization 5.1 -- NCI adjustment (3.4) -- Separation costs after the IPO -- 0.4 Foreign currency gain on intercompany loans (0.3) -- ----------------- -------------------- Total Net Adjustments 1.4 0.4 Income tax effect on adjustments (1) 0.1 -- Adjusted Net Earnings Available to Class A Common Stockholders $ 9.3 $ 6.4 ==== =========== === ===== ============= (1) For the three months ended December 31, 2020, the income tax effect was calculated using a rate of 7.0%, which represents the effective income tax rate on BellRing's 28.8% distributive share. For the October 21, 2019 to December 31, 2019 period, the income tax effect was calculated using a rate of 0.0%, as the amounts were primarily non-deductible separation costs for income tax purposes.f. NCI adjustment: BellRing has included adjustments for the portion of its consolidated net earnings/loss which was allocated to NCI, allowing for the calculation of Adjusted EBITDA to include 100% of BellRing as BellRing's management evaluates BellRing's operating performance on a basis that includes 100% of BellRing. g. Stock-based compensation: BellRing's compensation strategy after the IPO includes the use of BellRing stock-based compensation to attract and retain executives and employees by aligning their long-term compensation interests with BellRing's stockholders' investment interests. BellRing's director compensation strategy includes an election by any director who earns retainers in which the director may elect to defer compensation granted as a director to BellRing Class A common stock, earning a match on the deferral, both of which are stock-settled upon the director's retirement from the BellRing board of directors. BellRing's compensation strategy prior to the IPO included the use of Post stock-based compensation to attract and retain executives and employees by aligning their long-term compensation interests with Post's shareholders' investment interests; after the IPO, BellRing continues to be charged for Post stock-based compensation through the master services agreement with Post. BellRing has excluded stock-based compensation as stock-based compensation can vary significantly based on reasons such as the timing, size and nature of the awards granted and subjective assumptions which are unrelated to operational decisions and performance in any particular period and do not contribute to meaningful comparisons of BellRing's operating performance to other periods.fluctuations related to intercompany loans denominated in currencies other than the functional currency of the respective legal entity in evaluating BellRing's performance to allow for more meaningful comparisons of performance to other periods. e. Income tax effect on adjustments: BellRing has included the income tax impact of the non-GAAP adjustments using a rate described in the applicable footnote of the reconciliation tables, as BellRing believes that its GAAP effective income tax rate as reported is not representative of the income tax expense impact of the adjustments.

Adjusted EBITDA

BellRing believes that Adjusted EBITDA is useful to investors in evaluating BellRing's operating performance and liquidity because (i) BellRing believes it is widely used to measure a company's operating performance without regard to items such as depreciation and amortization, which can vary depending upon accounting methods and the book value of assets, (ii) it presents a measure of corporate performance exclusive of BellRing's capital structure and the method by which the assets were acquired and (iii) it is a financial indicator of a company's ability to service its debt, as BellRing LLC is required to comply with certain covenants and limitations that are based on variations of EBITDA in BellRing LLC's financing documents. Management uses Adjusted EBITDA to provide forward-looking guidance to forecast future results.

Adjusted EBITDA reflects adjustments for income tax expense, interest expense, net and depreciation and amortization including accelerated depreciation and amortization and the adjustments for restructuring and facility closure costs excluding accelerated depreciation and amortization, separation costs and foreign currency gain/loss on intercompany loans, as discussed above. Additionally, Adjusted EBITDA reflects adjustments for the following items:

RECONCILIATION OF NET EARNINGS AVAILABLE TO CLASS A COMMON STOCKHOLDERS

TO ADJUSTED NET EARNINGS AVAILABLE TO CLASS A COMMON STOCKHOLDERS (Unaudited)

(in millions)

RECONCILIATION OF DILUTED EARNINGS PER SHARE OF CLASS A COMMON STOCK

TO ADJUSTED DILUTED EARNINGS PER SHARE OF CLASS A COMMON STOCK (Unaudited)

RECONCILIATION OF NET EARNINGS AVAILABLE TO CLASS A COMMON STOCKHOLDERS

TO ADJUSTED EBITDA (Unaudited)

(in millions)

(END) Dow Jones Newswires

February 04, 2021 17:00 ET (22:00 GMT)