Adjusted EBITDA decreased 38% to $35.9 million, and adjusted net income declined 45% to $20.9 million.
Basic earnings per share decreased to $0.67, and adjusted EPS decreased 43% to $0.97 per share.
Branded Spirits sales declined 5%, with premium plus portfolio sales increasing 1%, while mid and value-tier brands experienced double-digit declines.
Capital expenditures were $10.6 million in Q2 and $18.7 million year-to-date, with full-year 2025 capex guidance reduced to approximately $32.5 million.
Consolidated sales decreased 24% to $145.5 million in Q2 2025 compared to the prior year, driven primarily by a 46% decline in Distilling Solutions segment sales.
Gross profit decreased 30% to $58.4 million, with gross margin declining 350 basis points to 40.1%.
Ingredient Solutions sales increased 5%, led by a 13% rebound in specialty protein sales and a 4% decline in Fibersym branded specialty wheat starch sales.
Net debt leverage remained stable at approximately 1.8x with a cash position of $17.3 million at quarter-end.
Year-to-date operating cash flow increased to $56.4 million from $29.6 million last year, driven by favorable working capital changes.
Papa John's Strategic Transformation and Leadership Initiatives
Todd Penegor highlighted the substantial progress made in transforming Papa John's over the past year, emphasizing leadership additions and strategic planning.
The company has focused on five key priorities, including core product innovation, marketing, technology, customer experience, and franchisee partnerships.
Leadership's emphasis on building a consumer insights-driven team with industry veterans signals a strategic shift towards customer-centric growth.
The CEO expressed confidence that the ongoing transformation is positioning Papa John's for profitable growth and long-term value creation.
The company is actively making strategic moves such as refranchising and supply chain optimization to support its transformation goals.
Dafinchi