Natural Grocers by Vitamin Cottage Announces Fiscal 2025 Fourth Quarter and Full Year Results

Reports Record Full Year Sales and Earnings

Increases Quarterly Cash Dividend by 25% to $0.15 per Common Share

Natural Grocers by Vitamin Cottage, Inc. (NYSE:NGVC) today announced results for its fourth quarter and fiscal year ended September 30, 2025 and provided its outlook for fiscal 2026.

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Highlights for Fourth Quarter Fiscal 2025 Compared to Fourth Quarter Fiscal 2024

— Net sales increased 4.2% to $336.1 million;

— Daily average comparable store sales increased 4.2%, and 11.3% on a two-year basis;

— Net income increased 31.0% to $11.8 million, with diluted earnings per share of $0.51; and

— Adjusted EBITDA increased 7.7% to $24.4 million.

Highlights for Fiscal 2025 Compared to Fiscal 2024

— Net sales increased 7.2% to $1.33 billion;

— Daily average comparable store sales increased 7.3%, and increased 14.3% on a two-year basis;

— 22nd consecutive year of positive comparable store sales growth;

— Net income increased 36.9% to $46.4 million, with diluted earnings per share of $2.00;

— Adjusted EBITDA increased 17.5% to $97.9 million; and

— Opened two new stores and relocated/remodeled three stores.

“We are pleased with our fourth quarter performance, with sales in-line with guidance and diluted earnings per share exceeding our outlook, resulting in record sales and earnings for fiscal year 2025,” said Kemper Isely, Co-President. “Consumers continued to be drawn to our differentiated offering of high-quality, natural and organic products reflecting their resilient prioritization of health and wellness, including food and nutrition. Moreover, we believe that our commitment to Always AffordableSM prices provides compelling value for our customers, strengthening our competitive position during periods of economic uncertainty.”

Mr. Isely continued, “Accelerated store growth is a core element of our strategy, and we are reiterating our plan to open six to eight new stores in fiscal 2026, underscoring the quality of our pipeline and execution capabilities. We also remain committed to enhancing value for our stockholders by maintaining a balanced approach to capital allocation. In addition to investing in our business to accelerate unit growth, we are proud to announce that we are increasing our quarterly cash dividend by 25% to $0.15 per common share, reflecting our strong fiscal 2025 operating performance and financial position, as well as confidence in our ability to create long-term stockholder value.”

In addition to presenting the financial results of Natural Grocers by Vitamin Cottage, Inc. and its subsidiaries (collectively, the Company) in conformity with U.S. generally accepted accounting principles (GAAP), the Company is also presenting EBITDA and Adjusted EBITDA, which are non-GAAP financial measures. The reconciliation from GAAP to these non-GAAP financial measures is provided at the end of this earnings release.

Operating Results – Fourth Quarter Fiscal 2025 Compared to Fourth Quarter Fiscal 2024

Net sales during the fourth quarter of fiscal 2025 increased $13.5 million, or 4.2%, to $336.1 million, compared to the fourth quarter of fiscal 2024, due to a $13.3 million increase in comparable store sales and a $2.9 million increase in new store sales, partially offset by a $2.7 million decrease in net sales related to closed stores. Daily average comparable store sales increased 4.2% in the fourth quarter of fiscal 2025, comprised of a 2.4% increase in daily average transaction count and a 1.8% increase in daily average transaction size.

Gross profit during the fourth quarter of fiscal 2025 increased $3.7 million, or 3.8%, to $99.0 million. Gross profit reflects earnings after product and store occupancy costs. Gross margin decreased by 10 basis points to 29.5% during the fourth quarter of fiscal 2025, compared to 29.6% in the fourth quarter of fiscal 2024. The decrease in gross margin was driven by lower product margin.

Store expenses during the fourth quarter of fiscal 2025 decreased 0.2% to $72.5 million, primarily driven by lower long-lived asset impairment charges partially offset by higher compensation expenses. Store expenses as a percentage of net sales were 21.6% during the fourth quarter of fiscal 2025, down from 22.5% in the fourth quarter of fiscal 2024. The decrease in store expenses as a percentage of net sales was driven by lower long-lived asset impairment charges and expense leverage.

Administrative expenses during the fourth quarter of fiscal 2025 increased 6.1% to $10.9 million, driven by higher technology expenses and compensation expenses. Administrative expenses as a percentage of net sales were 3.2% for each of the fourth quarters of fiscal 2025 and 2024.

Operating income for the fourth quarter of fiscal 2025 increased 28.5% to $15.5 million. Operating margin during the fourth quarter of fiscal 2025 was 4.6%, up from 3.7% in the fourth quarter of fiscal 2024.

Net income for the fourth quarter of fiscal 2025 was $11.8 million, or $0.51 diluted earnings per share, compared to net income of $9.0 million, or $0.39 diluted earnings per share, for the fourth quarter of fiscal 2024.

Adjusted EBITDA for the fourth quarter of fiscal 2025 was $24.4 million, compared to $22.6 million in the fourth quarter of fiscal 2024.

Operating Results -Fiscal 2025 Compared to Fiscal 2024

Net sales during fiscal 2025 increased $89.3 million, or 7.2%, to $1.33 billion, compared to fiscal 2024, due to an $86.1 million increase in comparable store sales and a $12.7 million increase in new store sales, partially offset by a $9.6 million decrease in sales related to closed stores. Daily average comparable store sales increased 7.3% in fiscal 2025, comprised of a 4.6% increase in daily average transaction count and a 2.6% increase in daily average transaction size.

Gross profit during fiscal 2025 increased $33.1 million, or 9.1%, to $397.9 million. Gross profit reflects earnings after product and store occupancy costs. Gross margin increased by 50 basis points to 29.9% during fiscal 2025, compared to 29.4% in fiscal 2024. The increase in gross margin was driven by higher product margin primarily attributed to effective promotions,and store occupancy cost leverage.

Store expenses during fiscal 2025 increased 4.7% to $290.5 million, primarily driven by higher compensation expenses partially offset by lower long-lived asset impairment charges. Store expenses as a percentage of net sales were 21.8% during fiscal 2025, down from 22.3% in fiscal 2024. The decrease in store expenses as a percentage of net sales was driven by expense leverage and lower long-lived asset impairment charges.

Administrative expenses during fiscal 2025 increased 14.6% to $44.4 million, primarily driven by higher compensation expenses and technology expenses. Administrative expenses as a percentage of net sales were 3.3% during fiscal 2025, up from 3.1% in fiscal 2024.

Operating income for fiscal 2025 increased 32.0% to $62.0 million. Operating margin for fiscal 2025 was 4.7%, compared to 3.8% in fiscal 2024.

Net income for fiscal 2025 was $46.4 million, or $2.00 diluted earnings per share, compared to net income of $33.9 million, or $1.47 diluted earnings per share, for fiscal 2024.

Adjusted EBITDA for fiscal 2025 was $97.9 million, compared to $83.3 million in fiscal 2024.

Balance Sheet and Cash Flow

As of September 30, 2025, the Company had $17.1 million in cash and cash equivalents and no outstanding borrowings on its $72.5 million revolving credit facility.

During fiscal 2025, the Company generated $55.3 million in cash from operations and invested $31.0 million in net capital expenditures, primarily for new and relocated/remodeled stores.

Dividend Announcement

Today, the Company announced the declaration of a quarterly cash dividend of $0.15 per common share, a 25% increase over the Company's previous quarterly dividend. The dividend will be paid on December 10, 2025 to stockholders of record at the close of business on December 1, 2025.

Growth and Development

During fiscal 2025 the Company opened two new stores, ending the fiscal year with 169 stores in 21 states.

Fiscal 2026 Outlook

The Company is confirming its fiscal 2026 outlook for the number of new stores and introducing the remainder of its fiscal 2026 outlook.

Fiscal 2026 OutlookNumber of new stores 6 to 8Number of relocations/remodels 2 to 3Daily average comparable store sales growth ‌ 1.5% to 4.0%Diluted earnings per share $2.00 to $2.15Capital expenditures (in millions) $50 to $55

Earnings Conference Call

The Company will host a conference call today at 2:30 p.m. Mountain Time (4:30 p.m. Eastern Time) to discuss this earnings release. The dial-in number is 1-888-347-6606 (US) or 1-412-902-4289 (International). The conference ID is “Natural Grocers Q4 FY 2025 Earnings Call.” A simultaneous audio webcast will be available at http://Investors.NaturalGrocers.com and archived for a minimum of 20 days.

About Natural Grocers by Vitamin Cottage

Natural Grocers by Vitamin Cottage, Inc. (NYSE: NGVC) is an expanding specialty retailer of natural and organic groceries, body care products and dietary supplements. The grocery products sold by Natural Grocers must meet strict quality guidelines and may not contain artificial flavors, preservatives, or sweeteners (as defined in its standards), synthetic colors, or partially hydrogenated or hydrogenated oils. The Company sells only USDA certified organic produce and exclusively pasture-raised, non-confinement dairy products, and free-range eggs. Natural Grocers' flexible smaller-store format allows it to offer affordable prices in a shopper-friendly, clean and convenient retail environment. The Company also provides extensive free science-based nutrition education programs to help customers make informed health and nutrition choices. The Company, founded in 1955, has 168 stores in 21 states.

Visit www.NaturalGrocers.com for more information and store locations.

Forward-Looking Statements

The following constitutes a “safe harbor” statement under the Private Securities Litigation Reform Act of 1995. Except for the historical information contained herein, statements in this release are “forward-looking statements” and are based on management's current expectations and are subject to uncertainty and changes in circumstances. All statements that are not statements of historical fact are forward-looking statements. Actual results could differ materially from these expectations due to changes in global, national, regional or local political, economic, inflationary, disinflationary, recessionary, business, interest rate, labor market, competitive, market, regulatory, trade policy, supply chain and other factors, and other risks detailed in the Company's Annual Report on Form 10-K and the Company's subsequent quarterly reports on Form 10-Q. The information contained herein speaks only as of the date of this release and the Company undertakes no obligation to publicly update forward-looking statements, except as may be required by the securities laws.

For further information regarding risks and uncertainties associated with the Company's business, please refer to the “Management's Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” sections of the Company's filings with the Securities and Exchange Commission, including, but not limited to, the Form 10-K and the Company's subsequent quarterly reports on Form 10-Q, copies of which may be obtained by contacting Investor Relations at 303-986-4600 or by visiting the Company's website at http://Investors.NaturalGrocers.com.

Investor Contact:

Reed Anderson, ICR, 646-277-1260, reed.anderson@icrinc.com

NATURAL GROCERS BY VITAMIN COTTAGE, INC.Consolidated Statements of Income(Unaudited)(Dollars in thousands, except per share data) Three months ended Year ended September 30, September 30, ‌ 2025 ‌ 2024 ‌ 2025 2024Net sales $ 336,141 322,661 1,330,836 1,241,585Cost of goods sold and occupancy costs 237,115 227,299 932,959 876,775Gross profit 99,026 95,362 397,877 364,810Store expenses 72,491 72,605 290,491 277,396Administrative expenses 10,867 10,241 44,353 38,715Pre-opening expenses 166 450 1,043 1,722Operating income 15,502 12,066 61,990 46,977Interest expense, net (696) (1,053) (3,063) (4,176)Income before income taxes 14,806 11,013 58,927 42,801Provision for income taxes (3,006) (2,003) (12,483) (8,866)Net income $ 11,800 9,010 46,444 33,935Net income per share of common stock:Basic $ 0.51 0.40 2.02 1.49Diluted $ 0.51 0.39 2.00 1.47Weighted average number of shares of common stockoutstanding:Basic 22,954,325 22,799,571 22,936,194 22,774,825Diluted 23,292,229 23,175,214 23,255,274 23,083,903NATURAL GROCERS BY VITAMIN COTTAGE, INC.Consolidated Balance Sheets(Unaudited)(Dollars in thousands, except per share data) September 30, ‌ 2025 ‌ 2024AssetsCurrent assets:Cash and cash equivalents $ 17,116 8,871Accounts receivable, net 11,966 12,610Merchandise inventory 132,968 120,672Prepaid expenses and other current assets 6,025 4,905Total current assets 168,075 147,058Property and equipment, net 182,741 178,609Other assets:Operating lease assets, net 259,586 275,111Finance lease assets, net 42,895 40,752Other assets 5,452 458Goodwill and other intangible assets, net 11,755 13,488Total other assets 319,688 329,809Total assets $ 670,504 655,476Liabilities and Stockholders' EquityCurrent liabilities:Accounts payable $ 80,991 88,397Accrued expenses 37,236 35,847Operating lease obligations, current portion 36,495 35,926Finance lease obligations, current portion 4,061 3,960Total current liabilities 158,783 164,130Long-term liabilities:Operating lease obligations, net of current portion 245,803 263,404Finance lease obligations, net of current portion 45,660 43,217Deferred income tax liabilities, net 7,863 10,471Total long-term liabilities 299,326 317,092Total liabilities 458,109 481,222Stockholders' equity:Common stock, $0.001 par value. 50,000,000 shares authorized, 22,954,712 and 22,888,540 23 23shares issued and outstanding at September 30, 2025 and 2024, respectivelyAdditional paid-in capital 63,033 60,327Retained earnings 149,339 113,904Total stockholders' equity 212,395 174,254Total liabilities and stockholders' equity $ 670,504 655,476NATURAL GROCERS BY VITAMIN COTTAGE, INC.Consolidated Statements of Cash Flows(Unaudited)(Dollars in thousands) ‌ Year ended September 30, 2025 2024Operating activities:Net income $ 46,444 33,935Adjustments to reconcile net income to net cash provided by operatingactivities:Depreciation and amortization 31,814 30,930Loss on impairment of long-lived assets and store closing costs 81 2,102(Gain) loss on disposal of property and equipment (34) 10Share-based compensation 3,960 2,829Deferred income tax benefit (2,608) (3,955)Non-cash interest expense 4 17Other 7 (160)Changes in operating assets and liabilities:(Increase) decrease in:Accounts receivable, net (411) (1,790)Income tax receivable (604) 252Merchandise inventory (12,296) (1,412)Prepaid expenses and other assets (5,516) (1,069)Operating lease assets 33,592 33,446(Decrease) increase in:Operating lease liabilities (34,432) (34,197)Accounts payable (6,086) 10,039Accrued expenses 1,389 2,783Net cash provided by operating activities 55,304 73,760Investing activities:Acquisition of property and equipment (31,201) (37,541)Acquisition of other intangibles (178) (1,139)Proceeds from sale of property and equipment 93 37Proceeds from property insurance settlements 315 43Net cash used in investing activities (30,971) (38,600)Financing activities:Borrowings under revolving loans 666,200 604,200Repayments under revolving loans (666,200) (604,200)Repayments under term loan – (7,688)Finance lease obligation payments (3,825) (3,610)Dividends to shareholders (11,009) (31,866)Payments of deferred financing costs – (18)Payments on withholding tax for restricted stock unit vesting (1,254) (1,449)Net cash used in financing activities (16,088) (44,631)Net increase (decrease) in cash and cash equivalents 8,245 (9,471)Cash and cash equivalents, beginning of year 8,871 18,342Cash and cash equivalents, end of year $ 17,116 8,871Supplemental disclosures of cash flow information:Cash paid for interest $ 1,181 2,216Cash paid for interest on financing lease obligations, net of capitalized 1,940 1,939interest of $252 and $338, respectivelyIncome taxes paid 15,911 13,581Supplemental disclosures of non-cash investing and financing activities:Acquisition of property and equipment not yet paid $ 2,373 3,679Acquisition of other intangibles not yet paid 10 22Lease assets obtained in exchange for new operating lease obligations 18,412 22,317Lease assets obtained in exchange for new finance lease obligations 7,419 (45)‌ NATURAL GROCERS BY VITAMIN COTTAGE, INC. Non-GAAP Financial Measures (Unaudited)

EBITDA and Adjusted EBITDA

EBITDA and Adjusted EBITDA are not measures of financial performance under GAAP. We define EBITDA as net income before interest expense, provision for income taxes, depreciation and amortization. We define Adjusted EBITDA as EBITDA as adjusted to exclude the effects of certain income and expense items that management believes make it more difficult to assess the Company's actual operating performance, including certain items such as impairment charges, store closing costs, share-based compensation, amortization of software hosting arrangement (SaaS) implementation costs and non-recurring items.

The following table reconciles net income to EBITDA and Adjusted EBITDA, dollars in thousands:

Three months ended Year ended September 30, September 30, 2025 ‌ 2024 ‌ 2025 ‌ 2024Net income $ 11,800 9,010 46,444 33,935Interest expense, net 696 1,053 3,063 4,176Provision for income taxes 3,006 2,003 12,483 8,866Depreciation and amortization 8,023 7,932 31,814 30,930EBITDA ‌ 23,525 19,998 93,804 77,907Impairment of long-lived assets and store – 1,721 118 2,547closing costsShare-based compensation 860 929 3,960 2,829Amortization of SaaS implementation costs 4 – 7 -Adjusted EBITDA $ 24,389 22,648 97,889 83,283

EBITDA increased 17.6% to $23.5 million for the fourth quarter of fiscal 2025 compared to $20.0 million for the fourth quarter of fiscal 2024. EBITDA increased 20.4% to $93.8 million for the year ended September 30, 2025 compared to $77.9 million for the year ended September 30, 2024. EBITDA as a percentage of net sales was 7.0% and 6.2% for the fourth quarter of 2025 and 2024, respectively. EBITDA as a percentage of net sales was 7.0% and 6.3% for the years ended September 30, 2025 and 2024, respectively.

Adjusted EBITDA increased 7.7% to $24.4 million for the fourth quarter of fiscal 2025 compared to $22.6 million for the fourth quarter of fiscal 2024. Adjusted EBITDA increased 17.5% to $97.9 million for the year ended September 30, 2025 compared to $83.3 million for the year ended September 30, 2024. Adjusted EBITDA as a percentage of net sales was 7.3% and 7.0% for the fourth quarter of fiscal 2025 and 2024, respectively. Adjusted EBITDA as a percentage of net sales was 7.4% and 6.7% for the years ended September 30, 2025 and 2024, respectively.

Management believes some investors' understanding of our performance is enhanced by including EBITDA and Adjusted EBITDA, which are non-GAAP financial measures. We believe EBITDA and Adjusted EBITDA provide additional information about: (i) our operating performance, because they assist us in comparing the operating performance of our stores on a consistent basis, as they remove the impact of non-cash depreciation and amortization expense as well as items not directly resulting from our core operations, such as interest expense and income taxes and (ii) our performance and the effectiveness of our operational strategies. Additionally, EBITDA is a component of a measure in our financial covenants under our credit facility.

Furthermore, management believes some investors use EBITDA and Adjusted EBITDA as supplemental measures to evaluate the overall operating performance of companies in our industry. Management believes that some investors' understanding of our performance is enhanced by including these non-GAAP financial measures as a reasonable basis for comparing our ongoing results of operations. By providing these non-GAAP financial measures, together with a reconciliation from net income, we believe we are enhancing investors' understanding of our business and our results of operations, as well as assisting investors in evaluating how well we are executing our strategic initiatives.

Our competitors may define EBITDA and Adjusted EBITDA differently, and as a result, our measures of EBITDA and Adjusted EBITDA may not be directly comparable to EBITDA and Adjusted EBITDA of other companies. Items excluded from EBITDA and Adjusted EBITDA are significant components in understanding and assessing financial performance. EBITDA and Adjusted EBITDA are supplemental measures of operating performance that do not represent and should not be considered in isolation or as an alternative to, or substitute for, net income or other financial statement data presented in the consolidated financial statements as indicators of financial performance. EBITDA and Adjusted EBITDA have limitations as analytical tools, and should not be considered in isolation, or as a substitute for analysis of our results as reported under GAAP. Some of the limitations are:

— EBITDA and Adjusted EBITDA do not reflect our cash expenditures, or future requirements for capital expenditures or contractual commitments;

— EBITDA and Adjusted EBITDA do not reflect changes in, or cash requirements for, our working capital needs;

— EBITDA and Adjusted EBITDA do not reflect any depreciation or interest expense for leases classified as finance leases;

— EBITDA and Adjusted EBITDA do not reflect the interest expense, or the cash requirements necessary to service interest or principal payments on our debt;

— Adjusted EBITDA does not reflect share-based compensation, impairment of long-lived assets, store closing costs and amortization of SaaS implementation costs;

— EBITDA and Adjusted EBITDA do not reflect our tax expense or the cash requirements to pay our taxes; and

— Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future and EBITDA and Adjusted EBITDA do not reflect any cash requirements for such replacements.

Due to these limitations, EBITDA and Adjusted EBITDA should not be considered as measures of discretionary cash available to us to invest in the growth of our business. We compensate for these limitations by relying primarily on our GAAP results and using EBITDA and Adjusted EBITDA as supplemental information.

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