By Dean Seal

Yeti Holdings said its sales growth was limited in the fourth quarter by a nearly two-year-old recall effort and that it expects the top line to keep rising in the 2025.

The maker of coolers and insulated drinkware posted a profit of $53.2 million, or 63 cents a share, for the quarter ended Dec. 28, compared with $78.6 million, or 90 cents a share, in the same period a year ago.

Stripping out one-time items, adjusted earnings were $1 a share. Analysts polled by FactSet had been expecting 93 cents a share.

Sales rose 5% to $546.5 million, below analyst projections for $552 million, according to FactSet.

Cooler and equipment sales were up 9% on strength among its bags and hard coolers. Drinkware sales were up 3%, driven by the expansion and innovation in its product line, Yeti said. Yeti's direct-to-consumer channel saw a 7% jump in sales, while its wholesale channel saw 2% growth.

The top line and Yeti's gross margin were both dented by an increase in reserves tied to a 2023 recall of certain soft coolers and gear cases. The company said more consumers participated in the recall during 2024 than anticipated.

Overhead costs, meanwhile, rose 12% during the quarter from higher employee and marketing expenses.

For fiscal 2025, the company is guiding for adjusted sales, which exclude the impact of recall reserves, to rise 5% to 7%. Adjusted earnings are expected to be $2.90 to $2.95 a share, ahead of current analyst forecasts for $2.89 a share, according to FactSet.

Shares advanced 3.7% to $39.30 in premarket trading.

Write to Dean Seal at dean.seal@wsj.com

(END) Dow Jones Newswires

February 13, 2025 06:27 ET (11:27 GMT)

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