Blue Buffalo: #1 Brand in the Wholesome Natural Pet Food Market Segment

Blue Buffalo Pet Products, Inc. is a Consumer Packaged Goods (CPG) company that sells dog and cat food made with whole meats, fruits and vegetables, and other high-quality, natural ingredients. The Company’s “BLUE” is a billion-dollar brand based on sales at retail. In addition, it is the #1 brand in the Wholesome Natural market segment. Blue Buffalo creates and develop its own recipes with its staff veterinarians and PhD nutritionists.

All of Blue Buffalo’s products are manufactured in the U.S. Blue Buffalo Pet Products work only with U.S. partners to manufacture its products per its recipes and specifications. The U.S. Pet Food market is $27 billion and the wholesome natural segment is the fastest growing segment of the U.S. Pet Food market. Blue Buffalo is more than four times the size of the next largest brand in this segment.

Established in 2002, Blue Buffalo Pet Products is headquartered in Wilton, Connecticut. Blue Buffalo went public on July 22, 2015 at an initial public offering (IPO) price of $20.00 per share.

The Company, by way of the Blue Buffalo Foundation, is a foremost sponsor of pet cancer awareness and of critical research studies of pet cancer at top veterinary medical schools and clinics across the U.S. This research includes causes, treatments, as well as the role of nutrition.

Blue Buffalo Pet Products provides natural foods and treats for dogs and cats under its BLUE Life Protection Formula, BLUE Wilderness, BLUE Basics, BLUE Freedom and BLUE Natural Veterinary Diet lines. BLUE dog foods and BLUE cat foods contain premier natural ingredients.

In addition, BLUE includes LifeSource Bits. These contain a precise blend of antioxidants, minerals, and vitamins chosen by holistic veterinarians and animal nutritionists. Also, the Company “cold forms” its LifeSource Bits to minimize the loss of potency, which takes place in numerous vitamins and nutrients when exposed to extreme heat.

BLUE pet food contains no chicken or poultry by-product meals. In addition, Blue Buffalo does not use corn, wheat or soy in any of its pet food recipes. The Company’s BLUE Freedom and high-protein BLUE Wilderness line of dog and cat foods are 100% grain-free.

Furthermore, Blue Buffalo’s BLUE Basics line is available in a grain-free formula.  The BLUE Basics formula is a limited-ingredient nutritionally complete diet. BLUE Basics is made with turkey or salmon as the first ingredient. BLUE Basics includes no corn, wheat, soy, dairy or eggs.

Blue Buffalo Pet Products sells its products to retail partners and distributors in specialty channels. These channels include national pet superstore chains, regional pet store chains, neighborhood pet stores, farm and feed stores, e-commerce retailers, military outlets, hardware stores, and veterinary clinics and hospitals.

The Company is working to penetrate further the Pet Food market as it has only a 6% share in the United States and feeds less than 3% of pets. Its largest channel is U.S. Pets’ Superstores. Blue Buffalo’s objective is to continue to grow its revenues 10% + annually in the coming year.

For Q3 2016, Blue Buffalo Pet Products’ revenue increased 11% in comparison to the year prior. WTO (Wet Foods, Treats, And Other Products) is an important component of the Company’s growth strategy. In Q3 2016, Blue Buffalo’s WTO growth rate was 8.6%. For Q3, its’ dry foods increased 11.6%.

Moreover, for Q3 2016, Blue Buffalo’s adjusted net income was $44.7 million. This represents an increase of 32.3%. The Company’s adjusted diluted EPS (Earnings per Share) was $0.22 per share. This represents an increase of 31.5%.