Q1 2024 Hormel Foods Corp Earnings Call

Operator: Good morning, ladies and gentlemen, and welcome to the Hormel Foods Corporation first quarter earnings conference call. At this time, all lines are in a listen-only mode.

Good morning, ladies and gentlemen, and welcome to the Hormel Foods Corporation first quarter earnings Conference call. At this time all lines are in a listen only mode.

Operator: Following the presentation, we will conduct a question and answer session. If at any time during this call you need assistance, please press star zero for the operator. This call is being recorded on Thursday, February 29th, 2024. I would now like to turn the conference over to David Dahlstrom, Director of Investor Relations. Please go ahead.

During the presentation, we will conduct a question and answer session.

If at any time during this call you need assistance. Please press star zero for the operator.

This call is being recorded on Thursday February 29, 2024, I would now like to turn the conference over to David Duston Director of Investor Relations.

Speaker Change: Please go ahead.

David W. Dahlstrom: Good morning. Welcome to the Hormel Foods conference call for the first quarter of fiscal 2024. We released our results this morning before the market opened at 630 a.m. Eastern Time. A copy of the release can be found on our website, www.hormelfoods.com, under the Investor section.

David Duston: Good morning, welcome to the Hormel Foods conference call for the first quarter of fiscal 2024, we released our results. This morning before the market opened around 630, a M eastern time a.

David Duston: A copy of the release can be found on our website Hormel foods dot com under the investors section.

James P. Snee: On our call today is Jim Snee, Chairman of the Board, President and Chief Executive Officer, Jacinth Smiley, Executive Vice President and Chief Financial Officer, and Deanna Brady, Executive Vice President of the Retail Segment. Jim will review the company's first quarter results and give a perspective on the rest of fiscal 2024. Jacinth will provide detailed financial results and further commentary on our outlook. Deanna will join Jim and Jacinth for the Q&A portion of the call.

David Duston: On our call today is Jim Snee, Chairman of the Board President and Chief Executive Officer, Justin Smiley Executive Vice President and Chief Financial Officer, Indiana, Brady Executive Vice President of the retail segment.

James P. Snee: Jim will review the company's first quarter results and give a perspective on the rest of fiscal 2024.

Jacinth C. Smiley: Central to provide detailed financial results and further commentary on our outlook General joined Jim and just sense for the Q&A portion of the call.

Unknown Executive: The line will be open for questions following Jacinth's remarks. As a courtesy to the other analysts, please limit yourself to one question with one follow-up. If you have additional questions, you are welcome to rejoin the queue.

Jacinth C. Smiley: The line will be opened for questions. Following <unk> remarks, as a courtesy to the other analysts please limit yourself to one question with one follow up if.

Speaker Change: If you have additional questions you are welcome to rejoin the queue.

David W. Dahlstrom: At the conclusion of this morning's call, a webcast replay will be posted to our investor website and archived for one year. Before we get started this morning, I need to reference the Safe Harbor Statement. Some of the comments made today will be forward-looking, and actual results may differ materially from those expressed in or implied by the statements we will be making. Please refer to our most recent annual report on Form 10-K and quarterly reports on Form 10-Q, which can be accessed at HormelFoods.com under the Investor section. Additionally, please note the company uses non-GAAP results to provide investors with a better understanding of the company's operating performance on a consistent basis. However, the presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP.

Speaker Change: At the conclusion of this morning's call a webcast replay will be posted to our investor website and archived for one year.

Speaker Change: Before we get started this morning, I need to reference the safe Harbor statement.

Speaker Change: Some of the comments made today will be forward looking and actual results may differ materially from those expressed in or implied by the statements we will be making.

Speaker Change: Please refer to our most recent annual report on Form 10-K, and quarterly reports on Form 10-Q, which can be accessed at Hormel foods dot com under the investors section.

Speaker Change: Additionally, please note the company uses non-GAAP results to provide investors with a better understanding of the company's operating performance on a consistent basis.

Speaker Change: The presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP.

James P. Snee: Non-GAAP figures adjust for the costs associated with the company's transformation and modernization initiatives. These non-GAAP measures include adjusted operating income, adjusted operating margin, adjusted SG&A as a percent of net sales, and adjusted diluted net earnings per share. Discussion on non-GAAP information and reconciliations to the GAAP results are detailed in our press release, which can be accessed from our corporate or investor website. I will now turn the call over to James Snee. Thank you, David. Good morning, everyone.

Speaker Change: non-GAAP figures adjust for the costs associated with the company's transformation and modernization initiatives.

Speaker Change: These non-GAAP measures include adjusted operating income adjusted operating margin adjusted.

Speaker Change: Adjusted SG&A as a percent of net sales and adjusted diluted net earnings per share.

Speaker Change: Discussion on non-GAAP information and reconciliations to the GAAP results are detailed in our press release, which can be accessed from our corporate or investor website.

Speaker Change: I will now turn the call over to Jim Snee.

James P. Snee: Thank you David good morning, everyone.

James P. Snee: We delivered strong results in the first quarter, led by better than expected performance in each of our segments. And we have made good initial progress on our work to transform and modernize our company. We also achieved broad-based volume growth across our business, reflecting the strength of our leading brands, robust demand for our food service products, and momentum in our planters and snack nuts business. These results demonstrate our team's meaningful execution against our strategic priorities, the value of our balanced business model, and marked improvements in our supply chain. Our first quarter results were very encouraging. We grew volume in each of our segments, with overall volume increasing 4%.

James P. Snee: We delivered strong results in the first quarter led by better than expected performance in each of our segments and we have made good initial progress on our work to transform and modernize our company.

James P. Snee: We also achieved broad based volume growth across our businesses, reflecting the strength of our leading brands robust demand for our foodservice products and momentum in our plant or a snack nuts business.

James P. Snee: These results demonstrate our team's meaningful execution against our strategic priorities.

James P. Snee: Value of our balanced business model and marked improvements in our supply chain.

James P. Snee: Our first quarter results were very encouraging.

James P. Snee: We grew volume in each of our segments with overall volume increasing 4%.

James P. Snee: Net sales grew 1%, led by another excellent quarter from our food service team. Adjusted operating margin increased compared to last year, reflecting higher gross profit and disciplined cost management; diluted net earnings per share was in line with last year, while on an adjusted basis, we grew our bottom line and cash from operations nearly doubled compared to the first quarter of last year, a direct result of our actions to better manage working capital and grow earnings. We have a clear and achievable path to deliver earnings growth and improve our business over the next three years. And, as we outlined at our recent Investor Day, we are focused on three enterprise objectives to accelerate profitable growth. First, restoring dependable operating income growth from our current business.

James P. Snee: Net sales grew 1% led by another excellent quarter from our foodservice team.

James P. Snee: Adjusted operating margin increased compared to last year.

James P. Snee: Reflecting higher gross profit and disciplined cost management.

James P. Snee: Diluted net earnings per share was in line with last year.

James P. Snee: On an adjusted basis, we grew our bottom line.

James P. Snee: And cash from operations nearly doubled compared to the first quarter of last year.

James P. Snee: Direct result of our actions to better manage working capital and grow earnings.

James P. Snee: We have a clear and achievable path to deliver earnings growth and improve our business over the next three years.

James P. Snee: And as we outlined at our recent Investor Day, we are focused on three enterprise objectives to accelerate profitable growth.

James P. Snee: First restoring dependable operating income growth from our current businesses.

James P. Snee: Second, driving savings through transformation and modernization, and third, capturing incremental value through our investments in the business. Our first quarter results demonstrate the strides we are making in each of these key focus areas. First, our results indicate progress towards restoring sustainable and dependable bottom-line growth, with momentum across the portfolio. Taking a closer look by business, food service is off to another fast start. Volume and net sales growth was broad-based across numerous categories, led by Jenny O'Turkey, and double-digit gains for products such as Hormel Bacon One Cooked Bacon, Pepperoni, Austin Blues Smoked Meat, and Cafe H Globally Inspired Protein. Segment profit increased 10% driven by volume, mix, and favorable logistics. We continue to operate from a position of strength in food service due to our longstanding relationships, differentiated product portfolio, innovative solutions, and direct sales. [inaudible] when we received the Distributors' Choice Award for Strategic Partnership by the International Food Service Distributors Association. This honor recognized our team as the most strategic partner across the food service landscape.

James P. Snee: Second driving savings through transformation and modernization.

James P. Snee: And third capturing incremental value through our investments in the business.

James P. Snee: Our first quarter results demonstrate the strides we are making in each of these key focus areas.

First our results indicate progress towards restoring sustainable and dependable bottomline growth.

James P. Snee: With momentum across the portfolio.

James P. Snee: Taking a closer look by business.

James P. Snee: Foodservice is off to another fast start volte.

James P. Snee: Volume and net sales growth were broad based across numerous categories led by Jennie O, Turkey, and double digit gains for products, such as Hormel Bacon, one cooked Bacon pepperoni, Austin Blues smoked meats and cafe H globally inspired proteins.

James P. Snee: Segment profit increased 10% driven by volume mix and favorable logistics expenses.

James P. Snee: We continue to operate from a position of strength in foodservice due to our long standing relationships differentiated product portfolio innovative solutions and direct sales team.

James P. Snee: This was again acknowledged by the industry in January when we received the distributors Choice award for a strategic partnership by the International Foodservice Distributors Association.

James P. Snee: This honor recognized our team as the most strategic partner across the foodservice landscape.

James P. Snee: We also delivered a solid quarter in the convenience store channel, led by our planters. Volume was strong for our snacking business and convenience, driven by positive takeaway for both the planters and corn nuts brand. We expect our convenience store business will continue to be a growth catalyst in fiscal 2024, led by expanded distribution of our flavored cashews, innovation in corn nuts, and better service levels on planters, peanuts, and trail mix items. We also plan to further leverage the momentum in our snack nuts business to increase placements of our other items across the convenience store footprint. Our international business is also off to a better than anticipated start to the year, as volume and segment profit both increased compared to last year.

James P. Snee: We also delivered a solid quarter in the convenience store channel led by our planters business Volte.

James P. Snee: Volume was strong for our staffing business and convenience driven by positive takeaway for both the planters and corn nuts brands.

James P. Snee: We expect our convenience store business will continue to be a growth catalyst in fiscal 2024.

James P. Snee: Led by expanded distribution of our flavored cashews innovation in corn nuts, and better service levels on planters Peanuts and trail mix items.

James P. Snee: We also plan to further leverage the momentum in our snack nuts business to increase placements of our other items across the convenience store footprint.

James P. Snee: Our international business is also off to a better than anticipated start to the year as volume and segment profit both increased compared to last year.

James P. Snee: Results this quarter were very encouraging, particularly given the challenging conditions the team faced in fiscal 2023. We remain confident the international business will further accelerate over the course of the year, driven by more normalized shipments of spam and an easing of headwinds impacting our commodity exports and growth from our partnerships around the world. In our retail segment, our leading brands, Execution in the Marketplace and Recovery in Turkey supported volume growth for the quarter. Demand was strong for many products, including Skippy peanut butter, Planter snack nuts, Holy dips, Herdez and La Victoria salsas, refrigerated entrees, and Hormel pepperoni, which all grew volume and net sales during the quarter.

James P. Snee: Results this quarter were very encouraging.

James P. Snee: Particularly given the challenging conditions the team faced in fiscal 2023.

James P. Snee: We remain confident that the international business will further accelerate over the course of the year.

James P. Snee: Driven by more normalized shipments of spam and.

Anything of headwinds impacting our commodity exports and growth from our partnerships around the world.

James P. Snee: In our retail segment, our leading brands execution in the marketplace and recovery in Turkey supported volume growth for the quarter.

James P. Snee: Demand was strong for many products, including Skippy peanut butter plant or a snack nuts wholly dips air des and a lot of Victoria sources, refrigerated entrees, and Hormel Pepperoni, which all grew volume and net sales during the quarter.

James P. Snee: Additionally, CIRCANA data noted several positives for the quarter, as we gained or maintained share across many of our products in key categories, including the Spam Family of Products, Skippy Peanut Butter, Hormel Black Label Bacon, Genio Ground Turkey, Hormel Pepperoni, Planter Snack Nuts, Herdez Salsas and Sauces, and Dinty Moore Stew. While we expect our retail business to face incremental pressure from Holberg Turkey Dynamics and, like many others in the industry, an uncertain consumer backdrop, our team remains focused on winning with our consumers and our customers. Better allocating our resources to drive profitable growth and improve the margin structure of the business. Underpinning the strong starts from our businesses was improvement across our supply chain as we reversed the inefficiencies and higher operating costs that we absorbed this time last year. Our supply chain improvements resulted in lower freight and warehousing expenses. Lower distressed sales and higher investment income resulting from a four day reduction in our cash cycle. Finished goods inventory was down on both a volume and dollar basis at the end of the first quarter, and total inventory was down almost 9% compared to last year.

James P. Snee: Additionally, <unk> data noted several positives for the quarter as we gained or maintained share across many of our products in key categories.

James P. Snee: Including the spam family of products Skippy peanut butter, Hormel Black label Bacon, Jennie O ground, Turkey, Hormel Pepperoni plant, our snack nuts are does salsas and sauces and Dinty Moore stew.

James P. Snee: While we expect our retail business to face incremental pressure from hallberg, Turkey dynamics and like many others in the industry and uncertain consumer backdrop are.

James P. Snee: Our team remains focused on winning with our consumers and our customers.

James P. Snee: Better allocating our resources to drive profitable growth and improving the margin structure of the business.

James P. Snee: Underpinning our strong starts from our business as well as improvements across our supply chain as we reversed the inefficiencies and higher operating costs that we absorbed this time last year.

James P. Snee: Our supply chain improvements resulted in lower freight and warehousing expenses lower distressed sales and higher investment income, resulting from a four day reduction in our cash cycle.

James P. Snee: Finished goods inventory was down on both a volume and dollar basis at the end of the first quarter and.

James P. Snee: In total inventory was down almost 9% compared to last year.

James P. Snee: In addition to forward progress on inventory management, fill rates have benefited from the increased efficiency and overall health of our one supply chain. First quarter retail and food service fill rates increased compared to both the prior quarter and the prior year, and our fill rates have surpassed 97% to begin the second quarter, marking the first time since March of 2020 that we have achieved this level of service. Turning to our second key strategic area, advancing our transformation and modernization initiatives. This includes the areas of supply chain efficiency, portfolio optimization, and data and analytics.

James P. Snee: In addition to a forward progress on inventory management fill rates benefited from the increased efficiency and overall health of our one supply chain.

James P. Snee: First quarter retail and foodservice fill rates increased compared to both the prior quarter and prior year.

James P. Snee: And our fill rates have surpassed 97% to begin in the second quarter, marking the first time since March of 2020 that we have achieved this level of service.

James P. Snee: Turning to our second key strategic area Advair.

James P. Snee: Advancing our transformation and modernization initiatives.

James P. Snee: This includes the areas of supply chain efficiency portfolio optimization and data and analytics.

James P. Snee: We're in the early innings with these efforts, but we are pleased with the progress our team has made thus far. Notably, within our planning work stream, we are implementing a new end-to-end planning process and are integrating new planning technology. In the buy work stream, we are realizing the benefits from our new procurement and productivity program, with further savings expected across many categories, such as logistics, warehousing, and supplies. In the Make Workstream, we are standardizing our ways of working across the manufacturing network.

James P. Snee: We're in the early innings with these efforts, but we are pleased with the progress our team has made thus far.

James P. Snee: Notably within our plan work stream, we are implementing a new end to end planning process and are integrating new planning technology.

James P. Snee: And the by work stream, we are realizing the benefits from our new procurement and productivity programs with further savings expected across many categories, such as logistics warehousing and supplies.

James P. Snee: Under the make work stream.

James P. Snee: We are standardizing our ways of working across the manufacturing network.

James P. Snee: We are also continuing to take actions to optimize our refrigerated and ambient distribution networks within our MOVE workstream. We made progress on our total company effort to improve our portfolio, identifying approximately 10% of the items to be optimized. Throughout the year, we expect to use our enhanced data and analytics capabilities to identify more opportunities to improve our portfolio. And to support these specific workstreams and the broader goals of the organization, we formed a data and analytics office, focused on creating easy access to reliable and consistent technology, data, and analytics.

James P. Snee: We are also continuing to take actions to optimize our refrigerated and ambient distribution networks within our move FERC stream.

James P. Snee: We made progress on our total company effort to improve our portfolio.

James P. Snee: Identifying approximately 10% of the items to be optimized.

James P. Snee: Throughout the year, we expect to use our enhanced data and analytics capabilities to identify more opportunities to better our portfolio.

James P. Snee: And to support a specific work streams and a broader goals of the organization, we formed a data and analytics office focused on creating easy access to reliable and consistent technology data and analytics.

James P. Snee: Executing our transformation and modernization initiative remains a critical piece to our projected growth over the next three years, and I'm pleased with the team's early progress. Moving on to the third key focus area, capturing value from our investors, where our progress was highlighted by the strong momentum in our planter snack nuts business. In the first quarter, planters volume and dollar share maintained positive momentum, while Total Points of Distribution and Household Penetration Group.

James P. Snee: Executing our transformation and modernization initiative remains a critical piece to our projected growth over the next three years and I am pleased with the team's early progress.

James P. Snee: Moving onto the third key focus area capturing value from our investments.

James P. Snee: While our progress was highlighted by the strong momentum in our plant or a snack nuts business.

In the first quarter planters volume and dollar share maintained positive momentum, while total points of distribution and household penetration group.

James P. Snee: We also continue to support the brand via higher ROI advertising and an always-on strategy, most recently with the launch of the Planters Ah Nuts campaign that went live in January. Innovation remains a point of focus for this business. One example is our flavored cashews line, which is delivering against our key performance indicators and remains on track to achieve its plan for the year. And most importantly, this product line continues to over-index with younger consumers, which is driving new consumers and excitement into the snack nuts category. Over the next few weeks, we will be launching additional innovation, including a salt and vinegar lime extension to our flavored cashews and a new-to-market offering, Planter's Nut Duos, which has the potential to be a significant contributor to the snack nuts category. We also continue to innovate with new varieties of corn, including Loaded Taco Flavored Corn Nuts and Kickin' Dill Pickle, which is expected to launch in time for summer.

James P. Snee: We also continue to support the brand.

James P. Snee: A higher ROI advertising and an always on strategy.

James P. Snee: Most recently with the launch of the planters.

James P. Snee: Nuts campaign that went live in January.

James P. Snee: Innovation remains a point of focus for this business.

James P. Snee: One example is our flavored cashews line, which is delivering against our key performance indicators and remains on track to achieve its plan for the year.

James P. Snee: Importantly, this product line continues to over index with younger consumers.

James P. Snee: It is driving new consumers and excitement to the snack nuts category.

James P. Snee: Over the next few weeks, we will be launching additional innovation and including a salt and vinegar line extension to our flavored cashews and a new to market offering planters nut duos, which has the potential to be a significant contributor to the snack nuts category.

James P. Snee: We also continue to innovate with new varieties of carve outs include.

James P. Snee: Including loaded Taco flavored corn nuts, and kicking tail pickles, which is expected to launch in time for summer.

James P. Snee: From a profitability perspective, we continue to put a heavy emphasis on redistributing our trade dollars to higher ROI promotions and channels, while simultaneously shifting mix toward innovation and premium nut brights. These are just some of the high priority plans we have in place to keep the momentum going for our Planters Snap Nuts business in fiscal 2024 and beyond. We continue to take action as the category leader to support the planters and Corn Nuts brands and drive growth for our business, the category, and for our customers.

James P. Snee: From a profitability perspective, we continue to put a heavy emphasis on redistributing, our trade dollars to higher ROI promotions and channels, while simultaneously shifting mix toward innovation and premium nut varieties.

James P. Snee: These are just some of the high priority plans, we have in place to keep the momentum going for our plant or stack nuts business in fiscal 2024 and beyond.

James P. Snee: We continue to take actions as the category leader to support the planters and corn nuts brands and drive growth for our business the category and for our customers.

James P. Snee: In addition to the planters business, we have many opportunities to capture incremental value from other investments and initiatives this year and into the future. This includes deriving further benefits from the Geneo Turkey Store Transformation, our Go Forward initiative, and the recent investments made in capacity and automation. While we realize that one quarter does not make a year and there remains significant work ahead, we are confident that we are on the right track to deliver on our commitment to improve our business and increase long-term shareholder returns. Now, we are reaffirming our full year net sales and earnings expectations. From a top-line perspective, we expect net sales growth of one to three percent. This continues to assume volume growth in key categories. Higher Brand Support and Innovation, and our Current Assumptions for Raw Material Input Cost. In retail, we expect higher net sales across many of our verticals. Targeted retail pricing actions will be effective by the end of the second quarter and are expected to impact our results in the back half of the year.

James P. Snee: In addition to the planters business, we have many opportunities to capture incremental value from other investments and initiatives this year and into the future.

James P. Snee: This includes driving further benefits from the Jennie O Turkey store transformation our go forward initiative.

James P. Snee: And the recent investments made in capacity and automation.

James P. Snee: While we realize that one quarter does not make it here and there remains significant work ahead. We are confident that we are on the right track to deliver on our commitment to improve our business and increase long term shareholder returns.

James P. Snee: Now shifting to our outlook.

James P. Snee: We are reaffirming our full year net sales and earnings expectations.

James P. Snee: From a top line perspective, we expect net sales growth of 1% to 3%. This continues to assume volume growth in key categories higher brand support and innovation and our current assumptions for raw material input costs.

James P. Snee: In retail, we expect higher net sales across many of our verticals.

James P. Snee: Targeted retail pricing actions will be effective by the end of the second quarter and are expected to impact our results in the back half of the year.

James P. Snee: In food service, we expect broad volume growth similar to the first quarter, led by turkey, pepperoni, and bacon. This volume growth, coupled with higher raw material input prices year over year, should support net sales gains. We expect net sales increases in our international business to be driven by the branded export business, led by Refrigerated Items, Skippy, and Spann, and the Retail and Food Service Channels in China.

James P. Snee: In foodservice, we expect broad volume growth similar to the first quarter.

James P. Snee: Led by Turkey, Pepperoni and Bacon.

James P. Snee: This volume growth, coupled with higher raw material input markets year over year should support net sales gains.

James P. Snee: We expect net sales increases in our international business to be driven by the branded export business led by refrigerated items Skippy and spam.

James P. Snee: And the retail and foodservice channels in China.

James P. Snee: From a bottom-line perspective, we are also reaffirming our diluted net earnings per share and adjusted diluted net earnings per share outlook. Consistent with our initial outlook, we expect continued growth in food service. improvement in our international business and benefits from innovation in retail. Our full year outlook also assumes higher salaries, normalized employee-related expenses, and costs associated with planned investments in the business. Diluted net earnings per share and adjusted diluted net earnings per share are expected to decline year over year in the second quarter and grow in the back half of the year. At a high level, we are assuming our stronger than expected start to be partially offset by incremental earnings pressure coming from our whole bird turkey business. Jacinth will provide further details on these assumptions in her remarks.

James P. Snee: From a bottom line perspective, we are also reaffirming our diluted net earnings per share and adjusted diluted net earnings per share outlooks.

James P. Snee: Consistent with our initial outlook, we expect continued growth in foodservice improvement in our international business and benefits from innovation in retail.

Our full year outlook also assumes higher salaries normalized employee related expenses and costs associated with planned investments in the business.

James P. Snee: Diluted net earnings per share and adjusted diluted net earnings per share are expected to decline year over a year in the second quarter.

James P. Snee: And grow in the back half of the year.

At a high level, we are assuming our stronger than expected start to be partially offset by incremental earnings pressure coming from our whole bird Turkey business.

James P. Snee: Seth will provide further details on these assumptions in her remarks.

James P. Snee: Taking all these factors into account for the full year, we expect net sales growth of one to three percent; diluted net earnings per share to be $1.43 to $1.57, and adjusted diluted net earnings per share to be $1.51 to $1.65.

Seth: Taking all these factors into account for the full year, we expect net.

Seth: Net sales growth of 1% to 3%.

Seth: Diluted net earnings per share to be $1 43 to $1 57.

Seth: And adjusted diluted net earnings per share to be $1 51 to $1 65.

Jacinth C. Smiley: And we expect a benefit to net earnings from our transformation and modernization initiatives. In closing, our strong start to the year reflects our team's ability to execute our clear and achievable plan. We remain focused on our strategic priorities and delivering on our commitment to improve our business and drive long-term shareholder returns. At this time, I will turn the call over to Jacinth Smiley to discuss detailed financial information related to the first quarter and additional color on key assumptions in our outlook. Thank you, Jim. Good morning, everyone.

Seth: And we expect that benefit to net earnings from our transformation and modernization initiatives.

Seth: In closing our strong start to the year reflects our team's ability to execute our clear and achievable plan.

Seth: We remain focused on our strategic priorities and delivering on our commitment to improve our business and drive long term shareholder returns.

Seth: At this time I will turn the call over to Josh Smiley to discuss detailed financial information related to the first quarter and additional color on key assumptions in our outlook.

Jacinth C. Smiley: Thank you Jim good morning, everyone.

Jacinth C. Smiley: We delivered strong results in the first quarter, led by better-than-expected performance in each of our business segments. During the first quarter, we grew volume 4% across all of our segments. Net sales for the first quarter were $3 billion, a 1% increase compared to the previous year.

Jacinth C. Smiley: We delivered strong results in the first quarter led by better than expected performance in each of our business segments.

Jacinth C. Smiley: During the first quarter, we grew volume, 4% and across all of our segments.

Jacinth C. Smiley: Net sales for the first quarter were $3 billion.

Jacinth C. Smiley: A 1% increase compared to the previous year.

Jacinth C. Smiley: Gross profit increased 3% driven by higher net sales and lower logistics expenses. Gross profit as a percentage of net sales increased to 17% compared to 16.7% last year and 16.1% in the fourth quarter. Both our retail and food service teams drove better margins quarter over quarter and compared to last. First quarter SG&A increased 8%, reflecting incremental investment in our transformation and modernization initiative and higher employee-related expenses. Adjusted SG&A as a percent of net sales was marginally higher compared to last year. Advertising investments are expected to be up significantly in the second quarter and increase for the full year.

Jacinth C. Smiley: Gross profit increased 3% driven by higher net sales and lower logistics expenses.

Jacinth C. Smiley: Gross profit as a percentage of net sales increased to 17% compared to 16, 7% last year and 16, 1% in the fourth quarter.

Jacinth C. Smiley: Both our retail and foodservice teams drove better margins quarter over quarter.

Jacinth C. Smiley: And compared to last year.

Jacinth C. Smiley: First quarter, SG&A increased 8%, reflecting incremental investment in our transformation and modernization initiatives.

Jacinth C. Smiley: Higher employee related expenses.

Jacinth C. Smiley: Adjusted SG&A as a percent of net sales was marginally higher compared to last year.

Advertising investments are expected to be up significantly in the second quarter, an increase for the full year.

Jacinth C. Smiley: We are actively supporting our brands in the marketplace, including the SPAM, Planters, and Hormel Chili brands. Equity in earnings of affiliates increased 3% primarily due to the inclusion of minority interest in Garuda Foods and growth from our partnership in the Philippines. Operating income for the first quarter was $284 million, and adjusted operating income was $295 million. The adjusted operating margin of 9.8% increased 10 basis points compared to the first quarter of last year. The effective tax rate was 23.4% compared to 22.6% for the previous year. Our prior year effective tax rate benefited from the impact of certain discrete items and a higher federal deductible. The effective tax rate for fiscal 2024 is expected to be between 21 and 23 percent.

Jacinth C. Smiley: We are actively supporting our brands in the marketplace, including the span planters and Hormel Chili brands.

Jacinth C. Smiley: Equity in earnings of affiliates increased 3%, primarily due to the inclusion of minority interest and Garuda food and growth from our partnership in the Philippines.

Jacinth C. Smiley: Operating income for the first quarter was $284 million and adjusted operating income was $295 million.

Jacinth C. Smiley: Adjusted operating margin of nine 8% increased 10 basis points compared to the first quarter of last year.

Jacinth C. Smiley: The effective tax rate was 23, 4% compared to 22, 6% for the previous year.

Jacinth C. Smiley: Our prior year effective tax rate benefited from the impact of certain discrete items and higher federal deductions.

Jacinth C. Smiley: The effective tax rate for fiscal 'twenty to 'twenty four is expected to be between 20 to one and 23%.

Jacinth C. Smiley: The net result of all these factors was diluted net earnings per share of 40 cents and adjusted diluted earnings per share of 41 cents. The upside this past quarter, compared to our expectations, was driven by broad-based volume growth. Stronger Results for All of Our Businesses. Improvement across the supply chain and below the line favorability. Thank you for watching this video, and don't forget to like, share, and subscribe to our channel. Operating cash flow of $404 million increased 98% compared to last year.

Jacinth C. Smiley: The net result of all these factors with diluted net earnings per share of <unk> 40 cents.

Jacinth C. Smiley: Adjusted diluted earnings per share of 41.

Jacinth C. Smiley: Upside this past quarter compared to our expectations.

Jacinth C. Smiley: It was driven by broad based volume growth.

Jacinth C. Smiley: <unk> results for all of our businesses.

Jacinth C. Smiley: Improvement across supply chain.

Jacinth C. Smiley: And below the line favorability.

Jacinth C. Smiley: Turning to cash flow.

Jacinth C. Smiley: Operating cash flow of $404 million increased 9% to 8% compared to last year.

Jacinth C. Smiley: This was a direct result of our successful actions to rectify the inefficiencies caused by elevated inventory levels last year and underlying business growth. Overall, we drove a four-day reduction in our cash conversion cycle. We paid our 382nd consecutive quarterly dividend, effective February 15th, at an annual rate of $1.13 per share, an increase of 3%. We invested $47 million in capital projects during the first quarter, including investments in our genuine turkey store transformation. Our outlook for capital expenditures in 2024 remains at $280 million. We ended the first quarter with $982 million in cash and short-term investments and $3.3 billion of debt.

Jacinth C. Smiley: This was a direct result of our successful actions to rectify the inefficiencies caused by elevated inventory levels last year and underlying business growth.

Jacinth C. Smiley: Overall, we drove a four day reduction in our cash conversion cycle.

Jacinth C. Smiley: We paid our 380 <unk> second consecutive quarterly dividend effective February 15 at an annual rate of $1 13 per share an increase of 3%.

Jacinth C. Smiley: We invested $47 million in capital projects during the first quarter, including investments in our Jennie O Turkey store transformation.

Jacinth C. Smiley: Our outlook for capital expenditures in 2024 remains at $282 million.

Jacinth C. Smiley: We ended the first quarter with $982 million in cash and short term investments and $3 $3 billion of debt.

Jacinth C. Smiley: We plan to utilize a combination of cash on hand and debt issued in the second quarter to pay our $950 million note due in June. We have accounted for higher interest expense in our outlook and expect to remain within our stated goal of one and a half to two times net debt to EBITDA. I would like to further highlight the progress we have been making on our Transformation and Modernization Initiative, which is expected to drive at least $200 million in operating income by 2026. Through the first quarter, we made great progress, and we remain on track to capture our full-year savings target for fiscal 2024. The work has intensified in the second quarter with the expectation that savings capture will accelerate throughout the year.

Jacinth C. Smiley: We plan to utilize a combination of cash on hand and debt issued in the second quarter to pay our $950 million note due in June.

Jacinth C. Smiley: We have accounted for a higher interest expense in our outlook and expect to remain within our stated goal of one and half to two times net debt to EBITDA.

Jacinth C. Smiley: I would like to further highlight the progress we have been making on our transformation and modernization initiative, which is expected to drive at least $200 million in operating income by 2026.

Jacinth C. Smiley: Through the first quarter, we made great progress and remain on track to capture our full year savings target for fiscal 2024.

Jacinth C. Smiley: The work has intensified in the second quarter with the expectation that savings capture will accelerate throughout the year.

Jacinth C. Smiley: This year, we are highly confident in our ability to capture direct savings from our productivity programs, which are targeting packaging, ingredients, and other supply categories. Continued benefits from the work we have done, lowering logistics expenses across our network, including lower contracted freight rates, optimized routes, increased truck weights, and reduced reliance on third-party warehousing; benefits from lower distress sales as we make improvements to our inventory management planning and manufacturing processes. Value derived from new capabilities and ways of working, including integrated business planning and from the implementation of our standardized and proprietary manufacturing system across our network, as well as benefits from minimizing complexity and reducing costs through portfolio optimization

Jacinth C. Smiley: This year, we are highly confident in our ability to capture.

Direct savings from our productivity programs, which are targeting packaging ingredients and other supply categories.

Continued benefits from the work, we have done Laura and logistics expenses across our network, including lower contracted freight rates optimized routes increased truck weights and reduced reliance on third party warehousing.

Jacinth C. Smiley: Benefits from a lower distressed sales as we make improvements to our inventory management planning.

Jacinth C. Smiley: And manufacturing processes.

Jacinth C. Smiley: Value derived from new capabilities and ways of working including integrated business planning and from the implementation of our standardized and proprietary manufacturing system across our network and benefit from minimizing complexity.

Jacinth C. Smiley: This is a truly exciting and important time for our company as we build toward our future, transitioning to our Outlook. We are reaffirming our full-year net sales and earnings expectations. To supplement what Jim reviewed earlier, I will share some additional color on our assumptions for the rest of the year. From a port perspective, our outlook remains unchanged. The USDA is projecting modestly higher production and exports in 2024. Cold storage levels for pork continue to trend below last year in historical averages, which we expect to be supportive of the pork market.

Jacinth C. Smiley: And reducing costs through portfolio optimization.

Jacinth C. Smiley: This is a truly exciting and important time for our company as we build to order feature.

Jacinth C. Smiley: Transitioning to our outlook.

Jacinth C. Smiley: We are reaffirming our full year net sales and earnings expectations.

Speaker Change: The supplemental Jim reviewed earlier I will share some additional color under our assumptions for the rest of the year.

Jacinth C. Smiley: We assume full-year pork input costs to be higher than last year and remain above the five-year average. Specific to Turkey, overall inventory levels have recovered despite lingering impacts from cases of HPAI in the fall and early winter. Barring a significant supply disruption this spring from additional outbreaks of HPAI, we are in a strong position to service our customers and attract new business opportunities. We made good progress regaining value-added turkey distribution in the retail and food service channels during the first quarter, and we expect this to continue for the rest of fiscal 2024 on the commodity side of the business. Holberg Turkey's markets have stabilized below our initial forecast.

Speaker Change: From a port perspective, our outlook remains unchanged.

Speaker Change: <unk> is projecting modestly higher production and exports in 2024.

Speaker Change: Cold storage levels for poor continued to trend below last year and historical averages, which we expect to be supportive of port markets.

Speaker Change: We assumed full year pork input costs to be higher than last year and remained above five year averages.

Speaker Change: Specific to Turkey overall inventory levels have recovered despite lingering impacts from cases HPE AI in the fall and early winter barring a significant supply disruption. This spring from additional outbreaks of HPE AI, we are in a strong position.

Jacinth C. Smiley: Consequently, we have included in our outlook incremental earnings pressure from lower than expected market prices. We began absorbing this impact in the first quarter and expect continued pressure for the balance of the year. Net net, we now expect approximately $0.15 of earnings headwinds from our attorney business in fiscal 2024, which is an update to the $0.10 impact we called out on our fourth quarter earnings call. Most of this $0.15 headwind will impact quarters 2 through 4. In the second quarter, we expect earnings to be lower compared to last year and lower relative to our expectations heading into the year, primarily related to our whole bird turkey business.

Speaker Change: To service, our customers and attract new business opportunities.

Speaker Change: We made good progress regaining value added Turkey distribution, and the retail and foodservice channels during the first quarter and we expect this to continue for the rest of fiscal 2024.

Speaker Change: On the commodity side of the business.

Speaker Change: Whole bird, Turkey markets have stabilized below our initial forecast.

Consequently, we have included in our outlook incremental earnings pressure from lower than expected market pricing.

Speaker Change: We began absorbing this impact in the first quarter and expect continued pressure for the balance of the year.

Jacinth C. Smiley: We remain confident in our growth outlook for the second half of the year, expecting all segments to deliver profit improvement in addition to benefits from our transformation and modernization initiatives. To wrap up our commentary this morning, I want to extend my gratitude to each and every member of our dedicated team. Your hard work has been instrumental in delivering a strong start to the year and contributing to the momentum in achieving our strategic objectives to improve our business for the long term. At this time, I will turn the call over to the operator for the question and answer portion of the call.

Speaker Change: Net net we now expect approximately 15 cents of earnings headwinds from our Turkey business in fiscal 2024, which is an update to the <unk> impact we called out on our fourth quarter earnings call.

Speaker Change: Most of this 15 headwind will impact quarters two through four.

Speaker Change: In the second quarter, we expect earnings to be lower compared to last year and lower relative to our expectations heading into the year, primarily related to our whole bird Turkey business.

Speaker Change: We remain confident in our growth outlook for the second half of the year expecting all segments to deliver profit improvement in addition to benefits from our transformation and modernization initiatives.

Operator: Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press the star followed by the number on your touchtone phone. You will hear a prompt that your hand has been raised. If you are using a speakerphone, please lift the handset before pressing any key.

Speaker Change: To wrap up our commentary this morning, I want to extend my gratitude to each and every member of our dedicated team.

Speaker Change: Your hard work has been instrumental in delivering a strong start to the year and contributing to the momentum and achieving our strategic objectives to improve our business for the long term.

Operator: The first question comes from Rupesh Parikh from Oppenheimer. Please go ahead. Good morning, and thanks for taking my question. So just going back to the Q1 performance, it was clearly ahead of expectations. So I was just hoping for more color in terms of what drove the outperformance. Good morning, Rupesh.

Speaker Change: At this time I will turn the call over to the operator for the question and answer portion of the call.

Speaker Change: Thank you.

Speaker Change: Ladies and gentlemen, we will now begin the question and answer session should you have a question. Please press the star followed by the one on your Touchtone phone you will hear what prompts that Johan has been raised if youre using a speaker phone. Please lift the handset before pressing any keys.

James P. Snee: Yeah, Q1 was a very strong performance for the company. And what's so exciting for us is that it was so broad-based. When we think about all the different areas, I mean, clearly, volume is a very positive story. We saw volume growth in each segment. You know, when we think about retail and what's happening in the retail environment, we knew Turkey volumes were going to be positive. But even when we take that out and some of our other non-track businesses, retail volumes were up year over year.

Speaker Change: First question comes from Xu <unk> Parikh from Oppenheimer. Please go ahead.

Rupesh Dhinoj Parikh: Good morning, and thanks for taking my question. So just going back to the queue Q1 performance. It was clearly ahead of expectations. So I was just hoping for more color in terms of what drove the outperformance.

Speaker Change: Hey, good morning, or Apache Yeah, Yeah, Q1 was a very strong performance for the company and then it really is what's so exciting for us as it was so broad based.

James P. Snee: You know, food service had a very strong quarter; they continue to really perform in the marketplace. And so, you know, across all of the businesses, it's really, really great to see them have a successful and strong Q1. And the other thing that we've spent a lot of time talking about is our supply chain. And we did see a marked improvement in our supply chain in Q1. You know, a year ago, we were talking about inventory, and we've really been able to get that under control. We've seen lower inventory, volume, and dollars, which obviously has a positive impact when we think about distressed sales.

Apache: Think about all the different areas I mean, clearly volume is a very positive story, we saw volume growth in each segment.

Apache: When we think about retail and what's happening in the retail environment, we need to Turkey volumes were going to be positive, but even when we take that out in some of our other non tracked businesses retail volumes were up year over year.

Apache: Foodservice had a had a very strong quarter. They continue to to really perform in the marketplace and so across all of the businesses.

Apache: Really really great to see them have a successful and a strong Q1 and the other thing that we've spent a lot of time talking about is our supply chain and we did see marked improvement in our supply chain in Q1.

James P. Snee: The other piece that's really, really exciting for us is seeing what we're getting done on fill rates. And we talked about in the prepared remarks that we've got the highest fill rate since 2020. You know, and then obviously, there was some below-the-line favorability as well.

Apache: A year ago, we were talking about inventory and we've really been able to get that under control we've seen lower inventory.

James P. Snee: But when we wrap it all up, I think the key takeaway here is that we're executing our strategy, and we have confidence that the business will keep moving in the right direction throughout 2024.

Apache: Volume and dollars, which obviously has a positive impact when we think about distress sales.

Apache: The other piece, that's really really exciting for us is seeing what we're getting done on fill rates and we talked about in the prepared remarks that we've got the highest fill rates since 2020.

James P. Snee: And then maybe just one quick follow-up question. So as we look at the outlook for the year, what are the key risks that you see in delivering those targets? Yeah, I think we tried to be pretty specific in regards to the risk that Turkey presents to us. You know, we know that the whole bird outlook is worse, and we built in another nickel with, you know, most of that occurring in Q2. You know, but, you know, the other part really is the consumer environment, which we're watching very closely. As we think about our business, our shares are solid. We're making advertising investments to support the brands and driving some great innovation. But we know that there are categories that are weak, and we are watching those volumes. But we're doing all the right things to make sure that we're driving our shares and supporting the brands. Great, thank you. I'll pass it along.

Apache: And then obviously there was some below the line favorability as well, but when you wrap it all up I think the key takeaway here is you know we're executing our strategy.

Apache: And we have confidence that the business will keep moving in the right direction throughout 2024.

Speaker Change: Great and then maybe just one quick follow up question. So as we look at the outlook for the year what are the key risks that you see in delivering those targets.

Speaker Change: Yes, I think we tried to be pretty specific and ray.

Speaker Change: Guards to the risk that Turkey presents to us.

Speaker Change: <unk>.

Speaker Change: We know that the whole bird outlook is worse than we built in another nickel.

Speaker Change: Most of that occurring in Q2.

Speaker Change: But.

Speaker Change: The other part really is the consumer environment, which we're watching very closely.

Speaker Change: We think about our business our shares are solid we're making advertising investments to support the brands driving some some great innovation, but we know that there are categories that are weak and where we are watching those volumes, but we're doing all the right things to make sure that we're driving our shares in supporting the brands.

Operator: Thank you. The next question comes from Ken Goldman at J.P. Morgan. Please go ahead.

Speaker Change: Great. Thank you I'll pass it along.

Speaker Change: Thank you. The next question comes from Ken Goldman of Jpmorgan. Please go ahead.

Operator: Hi, thank you. I just wanted to clarify something. Last quarter, your slide presentation said to expect back half profit growth in all three segments. Today, I think you're saying you'll just see profit improvement. Maybe it's just semantics, but I'm just trying to get a sense.

Ken Goldman: Hi, Thank you I just wanted to clarify something last quarter. Your slide presentation said to expect back half profit growth in all three segments today, I think youre, saying Youll just see profit improvement, maybe it's just semantics, but I'm just trying to get a sense do you still expect each segment's profits to increase year on year in the back half we're in now.

James P. Snee: Do you still expect each segment's profits to increase year on year in the back half? Or is the messaging now just that they'll improve sequentially and maybe not all be up year on year? Again, maybe just semantics.

Ken Goldman: The messaging just all improved sequentially and maybe not all be up year on year again, maybe just semantics.

James P. Snee: Yeah, a great, great question, Ken. Thanks for asking it. But we do expect profit growth in all segments in the back half of the year. Thank you. And then just on food service, obviously, your tone is pretty strong here. There are some more macro indications that, on the edge, some slowdown in restaurant demand is out there. Last quarter, you were seeing higher checks despite traffic softness. You still saw restaurants staffed for all hours.

Ken Goldman: Yeah.

Speaker Change: Great question, Ken Thanks for asking it but we do expect profit growth in all segments in the back half of the year.

Speaker Change: Perfect. Thank you and then.

Speaker Change:

Speaker Change: Just on foodservice, obviously your tone is pretty strong year.

Speaker Change: There are some more macro indications that on the edge.

Speaker Change: Some slowdown in the restaurant demand is out there last quarter, you were seeing higher checks. Despite traffic softness you still saw restaurant staff for all hours I'm. Just curious are there any amendments at all I guess, how you view.

James P. Snee: I'm just curious, are there any changes at all, I guess, in how you view the away-from-home situation from a macro perspective or any of those KPIs that you look at? Yeah, I mean, we're watching all those things, Ken. You know, the other part, obviously, in Q1, was some weather-related events that also had an issue. But, you know, from where we sit, and you've heard us say many, many times, is that we do believe that we have, and are working from such an advantageous position in our food service business, because it's not just the restaurant and hotel business, right? We have a significant non-commercial business as well. We've spent a lot of time talking about C-stores, which continue to grow.

Speaker Change: Way from home situation from a macro perspective or would any of those kpis that you look at it.

Speaker Change: Yeah, I mean, we're watching all of those things can you know the other part obviously in Q1 as there were some weather related events that also haven't have an issue, but you know from from where we sit and you've heard US say many many times is we do believe that we have and are working from such such a.

Speaker Change: Advantaged position in our foodservice business, because it's not just the restaurant and hotel business and we have a significant noncommercial business as well. We've spent a lot of time talking about C stores, which continue to grow and obviously the acquisition and execution against the <unk>.

James P. Snee: And obviously, the acquisition and execution against the Planters brand helps us in that regard. But even in the more traditional restaurant business, we still feel like we're operating from a position of strength because of this differentiated value-added portfolio, the relationships that we've built over 30 years, and really thinking about how we can help the operator take costs out of their system. And we do that through our direct selling organization. So yeah, we're watching all those macro factors. We know they're real. But I think the way that we've diversified and balanced the business, even within our food service segment, is what really helps set us apart. Thanks, Jim.

Speaker Change: <unk> brand helps us in that regard, but even in the more traditional restaurant business, we still feel like we're operating from.

Speaker Change: I shouldn't have strength because of this differentiated value added portfolio the relationships that we've built over 30 years and really thinking about how can we help the operator take cost out of their system and we do that through our direct selling organization. So yeah, we're watching all those macro factors.

Speaker Change: Actors, we know they're real but I think the way that we have diversified and balanced the business even within our foodservice segment is what really helps set us apart.

Speaker Change: Thanks, Jim.

Operator: Thank you. The next question comes from Michael Lavery at Piper Sandler. Please go ahead.

Speaker Change: Thank you. The next question comes from Michael Lavery Piper Sandler. Please go ahead.

James P. Snee: Thank you. Good morning, and Michael. I just was, you know, you've got to look at the volume gains across all segments that are harder to find in food these days, but certainly, you know, a couple of them had some price pressure. How are you thinking about pricing? You mentioned a couple of targeted actions coming in this second quarter, but can you give a sense of magnitude or where those might be? And just, you know, what you think about the rest of the year? Yeah, a great question, Michael.

Michael Scott Lavery: Thank you good morning.

Michael Scott Lavery: Hey, Michael.

Michael Scott Lavery: Just was.

Michael Scott Lavery: You've got just was looking at the volume gains across all segments.

Speaker Change: Harder to find and food these days, but certainly.

Speaker Change: A couple of them had some price pressure.

Michael Scott Lavery: Are you thinking about pricing you mentioned a couple of targeted actions coming this second quarter.

Michael Scott Lavery: But can you give a sense of magnitude or where those might be.

Michael Scott Lavery: How do you think about the rest of this year.

Speaker Change: Yeah, Great question, Michael and actually that the conversation does go back to what we said and in Q4 and in our outlook for the for the year. We had specifically you mentioned some targeted pricing.

James P. Snee: And actually, you know, the conversation does go back to what we said in Q4. And in our outlook for the year, we had specifically mentioned some targeted pricing. But I think to go along with that, which is really, really important, is that we are investing in our brands.

Speaker Change: I think to go along with that which is really really important is that we are investing in our brands and you know where we've invested higher advertising dollars to drive volume to improve mix.

James P. Snee: And, you know, we've invested higher advertising dollars to drive volume, to improve mix. We've got some great innovation that continues to be generated across many of the brands. And so it is, it's broad-based pricing, some of it's wraparound pricing. And, you know, just wanted to, you know, make sure that that was clear that it wasn't wasn't new that we were going back to Q4.

Speaker Change: We've got some great innovation that continues to be generated across many of the brands that are so it is it's broad based pricing some of its wrap around pricing.

Speaker Change: And.

Speaker Change: Just wanted to.

Speaker Change: Make sure that that was clear that it wasn't.

Speaker Change: Was it new that we are going back to Q4, and I think what I'll do is maybe turn it over to Deanna.

Deanna T. Brady: And I think what I'll do is maybe turn it over to Deanna to give you maybe some more specifics on what she's seeing in the retail environment. Just to clarify, it really is very targeted pricing and a few key categories where beef is the main driver. So, we've lagged in pricing on some of our grocery items relative to where beef has moved. We've taken some targeted pricing. With that in mind, though, we've been able to shift dollars from advertising to ensure that we're talking to the consumer about the products, the value, and the role they play in their lives, particularly for lunch and dinner. So, we've been able to pivot and turn on advertising.

Deanna: To give you maybe some more specifics on what she is seeing in the retail environment.

Deanna: Just to clarify it really is very targeted pricing and a few key categories where beef.

Deanna: The main driver so we've lagged in pricing in some of our grocery items relative to where beef has moved we've taken some targeted pricing with that in mind, though we've been able to shift dollars from advertising to ensure that we're talking to the consumer about the products the value and the role they play in their lives.

Deanna: Particularly for lunch and dinner is really great option. So we've been able to pivot and turn on advertising and in those categories like Stu hash in Chile.

Deanna T. Brady: And in those categories, like stew, hash, and chili, the ROI on advertising is extremely high, and so it's a really important strategy for us. We're also looking at promotions and thinking about, with these different pricing on the shelf, you know, adjusting our promotional strategy and thinking about depth and frequency of promotion to really get the right price for the consumer to stay in the category with us. Okay, that's a great color.

Deanna: On advertising is extremely high and so it's really important strategy for US. We're also looking at promotions and thinking about with these different pricing on shelf adjusting our promotional strategy and thinking about depth and frequency of promotion to really get the right.

Deanna: Rice.

Deanna: For the consumer to stay in the category with us.

Speaker Change: Okay, that's great color.

James P. Snee: And you mentioned the incremental headwinds on Turkey from extended price pressure or worse than expected. Sorry, if I might have missed it, then I know you touched on pretty much broad strengths in at least the first quarter, but what's the offset for that? Is it just sort of everything else? Or is there anything in particular that really is, you know, kind of keeping you from holding guidance that covers the extra pressure in Turkey? Yeah, you know, Michael. I mean, first of all, I want to apologize.

Speaker Change: You mentioned the incremental headwinds on Turkey.

Extended price pressure or worse than expected.

Speaker Change: Sorry, if I might've missed it and I know you touched on pretty much broad strength in at least the first quarter.

Speaker Change: But what's the offset for that is it just sort of everything else or is there anything in particular that really.

Speaker Change: He is kind of keeping you to hold guidance that covers the extra pressure in Turkey.

Speaker Change: Yes.

Speaker Change: Michael I mean first of all I want I apologize I misspoke, because I said that it was both targeted and broad based pricing, but it is very targeted pricing, which deanna corrected me on so when we think about.

James P. Snee: I misspoke because I said that it was both targeted and broad-based pricing, but it is very targeted pricing, which Deanna corrected me on. But when we think about the turkey situation and, you know, the reason we are where we are with guidance is that it's early. And, you know, for all the factors that we've talked about from some of our earlier questions, you know, obviously, food service is off to a great start. The Q1 performance demonstrates the business improvement. Our international team had a really strong first quarter, and that exceeded our expectations.

Speaker Change: You know what the Turkey situation and the reason we are where we are with guidance.

Speaker Change: And you know for.

Speaker Change: For all of the factors that we've talked about from some of our earlier questions.

Speaker Change: Foodservice is off to a great start.

The Q1 performance demonstrates the business improvement our international team had a really strong first quarter and that exceeded our expectations you know they've gotten back on track a little sooner than we thought.

James P. Snee: You know, they've gotten back on track a little sooner than we thought. And so, you know, that's what's going to offset that additional headwind coming from the turkey market. But in regards to just overall guidance, the biggest thing is it's early. Okay, great. Thanks so much.

So.

Speaker Change: That's what's going to offset that additional.

Speaker Change: Headwind in the coming from the Turkey market, but in regards to just overall guidance. The biggest thing is it's early.

Speaker Change: Okay, great. Thanks, so much.

Speaker Change: Okay.

Operator: Thank you. The next question comes from Tom Palmer at Citi. Please go ahead. Good morning.

Speaker Change: Thank you. The next question comes from Tom Palmer at Citi. Please go ahead.

Thomas Hinsdale Palmer: Good morning, Thank you for your questions.

Operator: Thanks for your question. I wanted to ask, or just clarify, I guess, the expected earnings outlook as the year progresses. So you're guiding for a decline in the second quarter year over year, and then an increase in the second half. I just wanted to clarify, are you looking for an increase in both the third quarter and the fourth quarter? Or might that be more weighted to one of those?

Thomas Hinsdale Palmer: Tom I wanted to ask on.

Thomas Hinsdale Palmer: So just to clarify I guess the expected earnings outlook as the year progresses, so youre guiding for a decline in second quarter year over year, and then an increase in the second half I just want clarify is that youre looking for an increase in both the third quarter and the fourth quarter or might that be more weighted to one of those two.

James P. Snee: Yeah, I mean, the way we're thinking about it right now, Tom, is it's, you know, we're looking at half to in totality, you know, and we know, so that's why we think we're going to talk about it that way, that we'll have profit growth in the back half. And, you know, really, what gives us that confidence is, you know, food service continues its trajectory. Our international team continues to ramp up their performance.

Speaker Change: Yes, I mean, the way we're thinking about it right now Tom if.

Speaker Change: We're looking at half two in totality.

Speaker Change: And so that's why we think we're going to talk we want to talk about it that way that will have profit growth in the back half and really what gives us that confidence is foodservice continues its trajectory.

Speaker Change: Our international team continues to ramp up their performance.

James P. Snee: You know, the retail team will continue to benefit. We've got, you know, in addition to what Deanna talked about, innovation, distribution, and supply chain continue their strong performance. And then we haven't talked about it yet, but we do expect to see our transformation and modernization initiative really, really accelerate as we go throughout the year. Okay, thanks for that. Um, and then I just wanted to ask about your visibility on Whole Turkey.

Our retail team will continue to benefit we've got you know in addition to what Diana talked about innovation distribution supply chain.

Speaker Change: <unk> strong performance and then we haven't talked about it yet, but we do expect to see our transformation and modernization initiative really really accelerate as we go throughout the year.

Speaker Change: Okay. Thanks for that.

Speaker Change: Then I just wanted to ask on your visibility on hold Turkey, I think when we looked at last year maybe.

James P. Snee: I think when we looked at last year, maybe you locked in or contracted a bit less volume pricing for Whole Birds than you would in a normal year. So maybe an update there, as we look at the progression of this year, is it going to be a bit more normal in terms of Whole Bird being contracted out, and therefore you have kind of a higher level of visibility on pricing than you did a year ago? I think we're in the midst of that process right now, Tom, so it's hard to say at this point. When we think about Turkey, there are a couple of components that we really should spend a little bit more time on.

Speaker Change: Locked in or contracted a bit less.

Speaker Change: Volume pricing for whole birds than maybe in a normal year. So maybe an update there as we look at the progression of this year is it going to be a bit more normal in terms of holberg contracted out and therefore, you have kind of a higher level of visibility on pricing than you did say a year ago.

Speaker Change: Yeah, I think it's we're in the midst of that process right now Tom So it's hard to it's hard to say at this point.

Speaker Change: But when we think about Turkey Theres a couple of components that we really should spend a little bit more time on.

James P. Snee: There's the value-added business. When we think about retail, lean ground Turkey, that value-added business is doing really well and gaining share. Our food service team, because we've got volumes back and supply back, they're doing a great job regaining lost business due to that lack of supply in the food service channel. Really, what we're talking about is the decline in the market, which, obviously, we are applying to what our estimates are for the whole Berg Turkey business for the rest of the year. And so that's how we're thinking about it. To actually know, you know, how it's going to shake out from now through the end of the year is still TBD.

Speaker Change: The value added business.

Speaker Change: And when we when we think about retail lean ground, Turkey that value added business is doing really well in gaining share.

Speaker Change: Our foodservice team.

Speaker Change: Because we've got volumes back in supply back Theyre doing a great job regaining lost business due to that lack of supply in the in the foodservice channel and so really what we're talking about is the decline in the market, which obviously we are applying to what our estimates are in the whole bird Turkey.

Speaker Change:

Speaker Change: Business for the rest of the year and so that's how we're thinking about it to actually know how it's going to shake out from now through the end of the year is still TBD.

James P. Snee: Understood. Thank you. Thank you. The next question comes from Ben Theurer from Barclays. Please go ahead.

Speaker Change: Understood. Thank you.

Speaker Change: Thank you. The next question comes from Ben Theurer from Barclays. Please go ahead.

Operator: Yes, good morning, Jim, and Jacinth. Thank you very much for taking my question. Congratulations on those very strong results for the first quarter. Jim, I wanted to kind of dig a little deeper into some of the volume dynamics, and particularly in retail as it relates to the non-turkey piece of it, and Deanna, maybe that's actually a question also for you. As you look through the performance of the first quarter and kind of progress further into 2Q and the back half of the year, what are your expectations for some of your other key categories in retail, in particular as it relates to Any caller here would be much appreciated.

Yes, good morning, Jim and thank you very much for taking my question. Congrats on this very strong results for first quarter.

Speaker Change: Okay.

Benjamin M. Theurer: Jim I wanted to kind of dig a little deeper into into some of the volume dynamics and particularly in retail as it relates to the non Turkey piece of it and Deanna maybe that's actually a question also for you as you look through that.

Benjamin M. Theurer: The performance of the fourth for the first quarter, sorry, and.

Deanna: Progress fervor into <unk> in the back half of the year what are your expectations for some of your other key categories in retail in particular as it relates to volume and the cadence of that if you think about it on a sequential basis any color here would be much appreciated.

Deanna T. Brady: Sure. Thanks, Ben. In the first quarter, we saw really nice volume growth across many of our flagship and rising brands. When you think about bacon, you think about pepperoni, you think about Applegate and our Megamex portfolio, so nice volume, both in shipments as well as takeaway at the shelf. Those are also a lot of the categories where we've invested in capacity, and so we've got a good runway for growth. When you think about bacon and pepperoni as examples, planters had a particularly strong quarter as well as Skippy, and we see all of those businesses I just mentioned continuing to grow throughout the year. And then Jim mentioned Denio Turkey on the shelf is doing exceptionally well. When you think of the value that Turkey offers, the health benefits, we're working really hard to make sure that our consumers understand the value that Turkey plays in their diet, in particular and the health benefits there.

Speaker Change: Sure. Thanks, Ben in the first quarter, we saw a really nice volume growth across many of our flagship and rising brands. When you think about Bacon you think about pepperoni, you think about applegate and in our <unk> portfolio saw nice volume both in shipments as well as take away at the shelf.

Speaker Change: Those are also a lot of the categories, where we've invested capacity and so we've got a good runway for growth.

Speaker Change: When you think about like Bacon and pepperoni as examples.

Speaker Change: <unk> had a particularly strong quarter as well as skippy and we continue we see those all of those businesses I just mentioned continuing to grow throughout the year and then Jim mentioned Jennie O. Turkey on shelf is doing exceptionally well when you think of the.

Speaker Change: The value that Turkey offers the health benefits, we're working really hard to make sure that our consumers understand the value that Turkey plays in their diet in particular and the health values there.

Deanna T. Brady: And then, under our new go forward structure, we're able to bring our brands together. That can really be impactful in helping consumers put dinner on the table. So you think of Genio, Lean Ground Turkey, coupled with our Portez portfolio as we head into the next quarter with Cinco de Mayo, and you'll see a lot of in-store activation of those brands working really hard together. Okay, perfect. And then just one quick follow up for Jacinth on the bond that's due later in the year. Did you say you planned on completely repaying it or partially repaying it? I didn't catch that in the prepared remarks. Sorry for that.

Speaker Change: Under our new go forward structure, we're able to bring our brands together that really can be impactful.

Speaker Change: Consumers put dinner on the table do you think of Jennie O lean ground, Turkey, coupled with our <unk> portfolio as we head into the next quarter with 5 de Mayo and you'll see a lot of in store activation of those brands working really hard together.

Speaker Change: Okay Perfect and then just one quick follow up for Jason on the bump that SKU late in the year did you say you're going to plan on completely repaying it partially repaying and I didn't catch it in the prepared remarks, sorry for that just wanted to clarify.

Jacinth C. Smiley: I just wanted to clarify. So, good morning, Ben. We will utilize our cash on a combination of our cash on hand and also go out with new debt issuance to pay down the full $950 million. Perfect. That's what I was looking for.

Speaker Change: So.

Speaker Change: So we will utilize our cash on a combination of our cash on hand.

Jason: And it also going out to with new debt issuance to pay down the full $950 million.

Speaker Change: Perfect. That's what I was looking for thank you very much.

Jacinth C. Smiley: Thank you very much. Thank you. The next question comes from Ben Bienvenu from Stevens Inc. Please go ahead. Peace, good morning.

Speaker Change: Thank you. The next question comes from Ben <unk> from Stephens, Inc. Please go ahead.

Benjamin M. Theurer: Hey, Thanks, good morning.

Operator: I want to ask as it relates to raw material input costs. We've seen, you know, various cuts within the overall cut out, as well as the overall cut out come down, namely, it has come down considerably year over year, really, for the last several quarters. Are you all in a position where you're able to start to recognize some margin benefit from that? And what is the lag associated with that dynamic and perhaps the tail in terms of your ability to procure and secure longer-dated, lower priced raw materials?

Benjamin M. Theurer: Okay. So I wanted to ask as it relates to raw material input cost we've seen.

Benjamin M. Theurer: Various.

Benjamin M. Theurer: Cuts within the overall cut out.

Benjamin M. Theurer: Well as they were all cut out come down.

Benjamin M. Theurer: Namely trim down considerably.

Year over year really for the last several quarters.

Benjamin M. Theurer: Are you all in a position where you were able to start to recognize some margin benefit from that and what is the lag associated with that dynamic and perhaps the tail.

Benjamin M. Theurer: In terms of your ability to procure and secure longer.

Benjamin M. Theurer: <unk> lower priced raw materials.

James P. Snee: Yeah, Ben, as we think about the impact of raw materials in the quarter, I mean, it was largely in line with what we expected. And, you know, the thing that we've talked about often is it's not necessarily a point in time for a market; it's the volatility and how each of those cuts is reacting. So I think the biggest thing to know is the commodity markets really didn't have a dramatic impact on our ability to have such a strong quarter this year or this first quarter. Okay, fair enough.

Speaker Change: Yes, Ben.

Speaker Change: Think about the impact of raw materials in the quarter I mean, it was largely in line with with what we expected.

Speaker Change: And the thing that we've talked about often is it's not necessarily a point in time or a market. It's the volatility and how those each of those those cuts are reacting so.

Speaker Change: I think the Vegas.

Speaker Change: Good thing to know is the.

The commodity markets really didn't have a dramatic impact in our ability to have such a strong quarter. This year or this this first quarter.

Speaker Change: Okay fair enough.

James P. Snee: As we think about supporting volume growth through the balance of the year, obviously, a good start to the year. Do you find yourself, you know, needing to make or wanting to make targeted investments in promotional activity or, you know, vendor-sponsored trade spends to support volume? What is your strategy there as we move through the year? Yeah, I'll go ahead and start on just the broader organization.

Speaker Change: As we think about supporting volume growth through the balance of the year, obviously, a good start to the year do you find yourself.

Speaker Change: Meeting to make or wanting to make targeted investments.

Speaker Change: Investments in promotional activity or vendor sponsored trade spend to support volume what is your strategy there as we move through the year.

Speaker Change: Yeah I'll go ahead and start on just the broader organization you know I think we spend a lot of time on retail, but I do think it's important to think about the total company.

James P. Snee: You know, I think we spend a lot of time on retail, but I do think it's important to think about total company volume growth. And, you know, International had a really strong first quarter earlier than we expected, but, you know, we expect them to show volume growth. Our food service business continues to be healthy, you know, that'll be a strong contributor to the total company volume performance. But I'll let, maybe, Deanna address the retail question specifically. Good morning, Ben.

Speaker Change: Volume growth in your international again had a really strong first quarter earlier than we expected, but we expect them to show volume growth our foodservice business continues to be healthy.

Speaker Change: That'll be a strong contributor to the total company volume performance, but I'll, let maybe Diana address the retail question specifically.

Diana: Good morning, Ben.

Diana: The plan for the rest of the year is a year over year increase in advertising youll see that advertising really pushed under our new structure towards the flagship and rising brands, that's working exceptionally well for us and we're seeing extra extremely strong return on investments. We have also moved to an <unk>.

Deanna T. Brady: The plan for the rest of the year is a year-over-year increase in advertising. You'll see that advertising is really pushed under our new structure towards the flagship and rising brands. That's working exceptionally well for us, and we're seeing extremely strong return on investments. We've also moved to an always-on strategy, in particular with planters, and that's working really hard as well.

Diana: Weighs on strategy in particular with planters and that's working really hard as well.

Deanna T. Brady: In addition to advertising to drive growth, we've got the most robust innovation pipeline and execution plan across a variety of our categories as we head into the year. And then we are finally thinking about promotional activity as well, and really monitoring how promotions are working. And we are seeing a difference from how they've worked the last few years, as well as thinking about relative to pre-COVID timeframes, but really being intentional to ensure that we're getting the right promoted prices to help drive growth and keep consumers in our categories and with our brand. Okay, perfect. Thanks so much.

Diana: In addition to advertising to drive growth and we've got the most robust innovation pipeline and execution plan across a variety of our categories as we head into the year.

Diana: And then we.

Diana: Finally, our thinking about promotional activity as well and really.

Diana: Monitoring how promotions are working and we are seeing a difference from how they worked for the last few years as well as thinking about relative to pre COVID-19 timeframes, but really being intentional to ensure that we're getting the right promoted prices to help drive growth and keep consumers in our categories and with our brands.

Okay perfect. Thanks, so much.

Operator: Thank you. The next question comes from Peter Galbo at Bank of America. Please go ahead.

Diana: Thank you. The next question comes from Peter Galbo at Bank of America. Please go ahead.

Operator: Hey guys, good morning. Thanks for taking the questions. Maybe just just two really quick ones.

Peter Thomas Galbo: Hey, guys. Good morning, Thanks for taking the questions maybe.

Peter Thomas Galbo: Maybe just just two really quick ones.

Operator: Jacinth, thanks for the help on Genio, the 15 cent update. I was wondering if we could just get a little bit more detail in terms of cadence. A, just what the impact was of that 15 cents in the first quarter. And then I think you said the majority of it coming in 2Q. If you could put a finer point on that, good morning, Peter.

Justin Thanks for the help on on Jennie O.

Peter Thomas Galbo: The 15th update I was wondering if we could just get a little bit more detail in terms of cadence.

Peter Thomas Galbo: Hey, just what the impact was about 15% in the first quarter and then I think you said the majority of that coming in <unk>. If you could put a finer point on that.

Speaker Change: Yeah, Good morning, Peter So.

Jacinth C. Smiley: So the way we are thinking about it for the rest of the year, certainly it's going to impact all the rest of the quarters going through the year, but we were thinking about, you know, most of that impact coming in this in the second quarter, and then the rest spread out. So if we think about the additional $0.05 that we talked about, so coming into the year, last year, we talked about the $0.10 impact. As we updated and looked at the impact this year, we think there's going to be an additional $0.05, and the additional $0.05 is going to be spread out with most of that $0.05 coming in the second. Okay, but is it fair to assume, like, was there a very minimal impact in the first quarter, or just again, as we're trying to bridge the whole number? Yeah, there's certainly some of it that happened in the first quarter, for sure, Peter. But it's a little bit minimal.

Speaker Change: The way we are thinking about it for the rest of the year certainly it is going to impact all the rest of the quarters going through the year, but we will.

Speaker Change: We're thinking about the most of that impact coming in this in the second quarter and then the rest spread out. So if we think about the additional five cent that we talked about so coming into the year when it was.

Speaker Change: Last year, we talked about 10 cents impact as we updated and looked at the impact. This year, we think theres going to be an additional five and additional five is going to be spread out with the most of that five coming in the second okay.

Speaker Change: But is it fair to assume like was there a very minimal impact in the first quarter or just again as we're trying to bridge the the whole number.

Speaker Change: Yeah, there's certainly some of it that happened in the in the first quarter for sure Peter Yeah. So hopefully everybody here isn't it a bit minimal it's fair to say some of that will spill over into Q2, but in addition, we will have the <unk> or what.

Jacinth C. Smiley: It's fair to say some of it will spill over into Q2. But, in addition, we'll have the five cents and what the census tried to describe as the majority of that five cents. Okay. Got it. And then, Jim, just food service.

Speaker Change: I'd describe that as the majority of that <unk> in Q2.

Speaker Change: Okay got it and then Jim just just foodservice.

James P. Snee: One question and maybe one comment. Obviously, the quarter came in a lot better than a lot of the indicators would have said, kind of back to Ken's question. You know, even speaking about some of the headwinds from January. So just maybe wanted to unpack that more.

Speaker Change: One question that maybe one comment.

Speaker Change: Obviously quarter came in a lot better than a lot of the indicators what it said kind of back to Ken's question.

Speaker Change: Even to speaking about some of the headwinds from January. So just just maybe wanted to unpack that more and then I think in your in your prepared remarks, you said foodservice volume you'd expect.

James P. Snee: And then, in your prepared remarks, you said food service volume you'd expect, kind of at a similar level through the rest of the year. So I just wanted to make sure I understood that comment before it was just more of a positive volume trend for food service. Thanks.

Speaker Change: At similar levels through the rest of the year. So I just wanted to make sure I understood that comment of where it was just more of a positive volume trend on foodservice.

James P. Snee: Yeah, I mean, I think the key takeaway here is, you know, the food service business continues to operate from a very advantaged position, and with a really strong Q1, and we expect that business to continue on a continuous trajectory throughout the year, which a big part of that is the volume growth that we expect in the back half of the business from it as well. So, you know, there was the January slowdown, which is really just weather-driven.

Speaker Change: Yeah, I mean, I think the key takeaway here is that our foodservice business continues to operate from a very advantaged position.

Speaker Change: And the really strong Q1, and we expect that business to continue through continuous trajectory throughout the year, which a big part of that is the volume growth that we expect in the back half of the business from it.

Speaker Change: As well so.

It was the January slowdown.

Speaker Change: With which really is just weather driven.

Operator: We see the weather impacting business, and then, of course, some of the post-holiday doldrums. But the business continues to perform really well, and we expect it to continue its trajectory in the second half of the year. Thank you. The next question comes from Adam Samuelson at Goldman Sachs. Please go ahead.

See the weather impacting the business and then of course some of the post holiday doldrums, but.

Speaker Change: Business continues to perform really well and we expect it to continuous trajectory in the back half of the year.

Speaker Change: Thank you. The next question comes from Adam Samuelson at Goldman Sachs. Please go ahead.

Operator: Yes, thank you. Good morning, everyone. Adam.

Adam L. Samuelson: Yes, Thank you and good morning, everyone.

James P. Snee: All right, so maybe just a first question, a bit of clarification, just as I think about Turkey and the impact and on company-level volumes, this quarter, you're lapping some of the steepest production disruptions last year from HPAI in your own business. And so just can you just articulate how much of the year on year volume growth at the company level of 3.7% was attributable to kind of the normalization of your own production, which I would think explains basically all of that 3.7% and maybe on, touching on Peter's question. Just to be clear, Jim, are you saying food service is growing volumes at a kind of mid to high single digit rate for the balance of the year? Or are you talking about absolute volume?

Adam L. Samuelson: Hi, Adam.

Adam L. Samuelson: Hi, So maybe just a first question.

Adam L. Samuelson: Verification services thinking about Turkey, and the impact on company level volumes.

Adam L. Samuelson: This quarter you are lapping some of the steepest.

Adam L. Samuelson: Production disruptions last year from HPA.

Your own business and so.

Adam L. Samuelson: Just can you just.

Adam L. Samuelson: Articulate how much of the year on year volume growth at the company level is three 7% was <unk>.

Adam L. Samuelson: <unk> to kind of the normalization of your own Turkey production with.

Adam L. Samuelson: Thank you expense basically all of that three 7%.

Adam L. Samuelson: And maybe on.

Adam L. Samuelson: Touching on Peter's question.

Adam L. Samuelson: Just to be clear Jim are you, saying foodservice you think is growing volumes at a kind of.

James P. Snee: Mid to high single digit clip for the balance of the year or Youre talking about the absolute volume.

James P. Snee: [inaudible] Staying at this level through the ballot. Yeah, okay. So, Adam, on the turkey question with volume, what we were saying is that we had expected turkey volumes to grow, which they did, but then we also saw growth in underlying volumes in our broad-based value-added businesses. So, that's how we're thinking about that. And then, really, for food service volume growth, we expect that to be in the mid-single digit range. Okay, well, okay. But I guess maybe kind of keying off that then, especially where there's still inflation on the beef side.

James P. Snee: Tonnage.

James P. Snee: Staying at this level.

Sure.

James P. Snee: Through the balance of the year.

Speaker Change: Yeah, Okay. So so Adam I guess on the Turkey question with volume what we were saying is that we had expected Turkey volumes to grow which they did.

Speaker Change: But then we also saw growth in underlying volumes and our broad based value added businesses. So that's that's how we're thinking about that and then really for foodservice volume growth, we expect that to be in the mid single digit range.

Adam L. Samuelson: Okay well okay.

Speaker Change: So I guess, maybe kind of keying off that then.

Speaker Change: Especially where there is still inflation.

Speaker Change: On the beef side.

James P. Snee: I'm trying to think about kind of mid single-digit volumes in your food service business, kind of some recovery in international, which had a quite challenging 2023. I'm trying to square that to the overall guidance for company level sales of up one to 3% for the year. And just the implied decline in either consolidated pricing and or the retail business during the balance of the year. So how do I bridge those two pieces a little bit more clearly?

Speaker Change: I'm trying to think about kind of mid single digit volumes.

Speaker Change: In your foodservice business kind of some recovery in international which had a quite challenging 2023, I'm trying to square that so the overall guidance.

Speaker Change: For company level sales are up 1% to 3% for the year.

Speaker Change: And just the implied decline in either holidayed pricing and or the retail business and the balance of the year. So how do I bridge those two pieces a little bit more clearly.

James P. Snee: Well, there's a lot there, Adam. I think from our perspective, there are two things. I want to go back to the reason we reaffirmed our guidance is, you know, it's early. I think the second part in terms of, you know, as you think about trying to parse all of that apart, you'll have a follow-up call with David, and that's probably a really good time to walk through all those different parts. All right, it's worth a shot.

Speaker Change: Okay, well there is a lot there Adam I think from from our perspective I think there's two things I wanted to go back to the reason, we reaffirmed our guidance as.

Speaker Change: It's early but I think the second part in terms of you know as you think about trying to parse all of that apart.

Speaker Change: You'll have a follow up call with with David.

Speaker Change: A really good time to work through all those different parts.

Speaker Change: Okay, Alright worth a shot.

James P. Snee: I'll pass it on. Yeah, thank you. Thank you. There are no further questions.

Speaker Change: I'll pass it on thanks Yep. Thank you.

Speaker Change: For you.

Speaker Change: Okay.

Speaker Change: Thank you as there are no further questions I will now turn the call back over to Jim Snee for closing comments.

James P. Snee: I will now turn the call back over to James Snee for closing comments. Well, I want to thank all of you for joining us this morning. We're really pleased with our overall performance and the strong first quarter that we were able to deliver. This is the result of a total team effort, and I want to take the opportunity to thank all of our team. It's early.

James P. Snee: Well I want to thank all of you for joining us this morning.

James P. Snee: We're really pleased by our overall performance and the strong first quarter that we were able to deliver.

This is a result of a total team effort and I want to take the opportunity to thank all of our teams. It's early we know we have a lot of work to do to deliver the numbers. We wanted to deliver for the balance of the year, but as I said earlier, we are executing our strategy and we have confidence that the business will keep moving in the right direction throughout <unk>.

James P. Snee: We know we have a lot of work to do to deliver the numbers we want to deliver for the balance of the year, but as I said earlier, we are executing our strategy, and we have confidence that the business will keep moving in the right direction throughout 2024. Thank you, everyone. Ladies and gentlemen, this concludes today's conference call. We thank you for participating, and we ask that you please disconnect your lines.

James P. Snee: 24.

Speaker Change: Thank you everyone.

Speaker Change: Yes.

Speaker Change: Ladies and gentlemen, this concludes today's conference call. We thank you for participating and we ask that you. Please disconnect your lines.

Speaker Change: Okay.

Speaker Change: Yes.

Speaker Change: Okay.

Speaker Change: Okay.

Okay.

Speaker Change: Okay.

Speaker Change: No.

Speaker Change: Okay.

Speaker Change: Okay.

Speaker Change: Yes.