Freshpet, Inc. (NASDAQ:FRPT) reported first-quarter results on Wednesday that beat Wall Street expectations and raised its full-year sales outlook, driven by double-digit volume growth and margin expansion.

Despite the strong results and higher guidance, Freshpet shares traded lower following the earnings release.

Freshpet reported first-quarter EPS of 91 cents, beating analyst estimates of 15 cents. Net sales increased 13.1% year over year to $297.6 million, above estimates of $291.8 million.

Net income totaled $48.5 million, compared with a net loss of $12.7 million a year earlier.

Growth, Margins Improve

Sales growth was driven by volume gains of 14.6%, partly offset by unfavorable price and mix of 1.5%.

Gross profit increased to $120.7 million from $103.8 million, while gross margin expanded to 40.5% from 39.4%. Adjusted gross margin rose to 46.9% from 45.7%, helped by lower input costs and improved plant leverage.

Operating income totaled $4.3 million, compared with an operating loss of $11.5 million in the ...