Q3 2024 Post Holdings Inc Earnings Call

Operator: Please stand by, your program is about to begin. If you need operator assistance during your conference today, please press star zero. Welcome to Post Holdings' third quarter 2020.

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Operator: Welcome to the post-toldings third quarter 2020. At this time, I'll participate in seven placed on a listen-only mode, and the floor will be open for questions following the presentation. If you would like to ask a question at that time, please press star one on your telephone keypad. If at any point your question has been answered, you may remove yourself from the queue by pressing star two. So others can hear your questions clearly, we do ask for you please pick up your handset for best sound quality. And lastly, should you require operator assistance, please press star zero.

Post Holdings: Welcome to the post holdings third quarter 2020.

Speaker Change: Uh huh.

Operator: At this time, all participants have been placed in a listen-only mode, and the floor will be open for questions following the presentation. If you would like to ask a question at that time, please press Star 1 on your telephone keypad. If at any point your question has been answered, you may remove yourself from the queue by pressing Star 2. To help others hear your questions clearly, we do ask that you please pick up your handset for best sound quality. And lastly, should you require operator assistance, please press star zero. I would now like to turn the call over to Daniel O'Rourke, Investor Relations for Post.

Speaker Change: At this time, all participants have been placed on a listen only mode and the floor will be opened for questions. Following the presentation. If you would like to ask a question at that time. Please press star one on your telephone keypad.

Speaker Change: If at any point. Your question has been answered you may remove yourself from the queue by pressing star two.

Speaker Change: So others can hear your questions clearly, we do ask that you. Please pick up your handset for best sound quality and lastly should you require operator assistance. Please press star zero.

Unknown Executive: I would now like to turn the call over to the Annual Overwork Investor Relations for Post.

Speaker Change: I would now like to turn the call over to Daniel O'rourke Investor Relations for post.

Unknown Executive: Good morning. Thank you for joining us today for post third quarter fiscal 2024 earnings call. I'm joined this morning by Rob by Tally, our President and CEO, Jeff Zatics, our COO, and Matt Mayner, our CFO and Trudger. Rob at Jeff and Matt will make prepared remarks, and afterwards will answer your questions. The press release that supports these remarks is posted on both the Investors and the SEC filing sections of our website. And is also available on the SEC's website. As a reminder, this call is being recorded, and an audio replay will be available on our website at postholdings.com.

Daniel O'Rourke: Good morning. Thank you for joining us today for POST's third quarter fiscal 2024 earnings call. I'm joined this morning by Rob Vitale, our President and CEO, Jeff Zadoks, our COO, and Matt Mainer, our CFO and Treasurer. Rob, Jeff, and Matt will make prepared remarks, and afterwards, we'll answer your questions.

Daniel O'Rourke: Good morning, Thank you for joining us today for post third quarter fiscal 2024 earnings call.

Speaker Change: I'm joined this morning by Rob Vitale, our president and CEO, Jeff Statics, our CLO and Matt Mainer, our CFO and treasurer.

Speaker Change: Robert Jeff and Matt will make prepared remarks, and afterwards, we'll answer your questions.

Speaker Change: The press release that supports these remarks is posted on both the investors and the SEC filing section of our website and is also available on the Sec's website.

Speaker Change: As a reminder, this call is being recorded and an audio replay will be available on our website at post holdings dotcom.

Unknown Executive: Before we continue, I would like to remind you that this call will contain forward-looking statements, which are subject to risks and uncertainties that should be carefully considered by investors, as actual results could differ materially from these statements. These forward-looking statements are current as of the date of this call, and management undertakes no obligation to update these statements. This call will discuss certain non-GAAP measures.

Daniel O'Rourke: The press release that supports these remarks is posted on both the investors and the SEC filing sections of our website and is also available on the SEC's website. As a reminder, this call is being recorded, and an audio replay will be available on our website at postholdings.com. Before we continue, I would like to remind you that this call will contain forward-looking statements, which are subject to risks and uncertainties that should be carefully considered by investors, as actual results could differ materially from these statements.

Speaker Change: Before we continue I would like to remind you that this call will contain forward looking statements, which are subject to risks and uncertainties that should be carefully considered by investors as actual results could differ materially from these statements.

Daniel O'Rourke: These forward-looking statements are current as of the date of this call, and management undertakes no obligation to update these statements. This call will discuss certain non-GAAP measures. For a reconciliation of these non-GAAP measures to the nearest GAAP measure, see our press release issued yesterday and posted on our website. With that, I will turn the call over to Rob. Thank you, Daniel.

Speaker Change: These forward looking statements are current as of the date of this call and management undertakes no obligation to update these statements.

Speaker Change: This call will discuss certain non-GAAP measures for a reconciliation of these non-GAAP measures to the nearest GAAP measure see our press release issued yesterday and posted on our website with that I will turn the call over to Rob.

Unknown Executive: For reconciliation of these non-GAAP measures to the nearest GAAP measure, CR press release issued yesterday and posted on our website.

Unknown Executive: With that, I will turn the call over to Rob.

Rob Vitale: Thank you, Daniel. In Q3, we delivered another quite solid quarter. That enabled us to increase our full year guidance. While they were fully satisfied, we are quite pleased with the business performance, including recent acquisitions. I'm certain you notice we have been aggressive in purchasing our own shares. The solid performance is against the challenging and transitioning consumer environment. Inflation is cooling, but solar labor markets. Meanwhile, rapid cumulative change of pricing over the last couple of years has impacted consumer behavior across channels. We expect to work through this reference price phenomenon in both retail and food service channels over the next year.

Robert Vitale: Thank you, Daniel. In Q3, we delivered another quite solid quarter. That enabled us to increase our full-year guidance. While never fully satisfied, we are quite pleased with the business performance, including recent acquisitions. I'm certain you have noticed we have been aggressive in purchasing our own shares. This solid performance is against a challenging and transitioning consumer environment. Inflation is cooling, but so are labor markets.

Rob Vitale: Daniel in Q3, we delivered another quite solid quarter guys.

That enabled us to increase our full year guidance well never fully satisfied we are quite pleased with the business performance, including recent acquisitions I'm.

Speaker Change: I'm sure you noticed we have been aggressive in purchasing our own shares.

Speaker Change: This solid performance is against the challenging and transitioning consumer environment inflation as cooling, but sort of labor markets. Meanwhile, rapid cumulative change in pricing over the last couple of years, that's impacted consumer behavior across channels.

Robert Vitale: Meanwhile, a rapid cumulative change in pricing over the last couple of years has impacted consumer behavior across channels. We expect to work through this reference price phenomenon in both retail and food service channels over the next year. Key highlights of the quarter include

Speaker Change: We expect to work through this reference price phenomenon in both retail and foodservice channels over the next year.

Rob Vitale: Kiao, it's the quarter, include strong consumption of both our branded and private label serial products. On going out performance in our pet systems versus our underwriting case, significant mix improvement in value added eggs. We expect these highlights to be sustained in FY25.

Speaker Change: Key highlights for the quarter.

Speaker Change: <unk>.

Robert Vitale: Strong consumption of both our branded and private label cereal products. Ongoing outperformance in our pet business versus our underwriting case. Significant Mix Improvement in Value Added X. We expect these highlights to be sustained in FY25. On the other side of the ledger, our refrigerator retail segment underperformed as trade investment cannibalized base volume without sufficient incremental lift.

Speaker Change: Strong consumption of both our branded and private label cereal products.

Speaker Change: Ongoing outperformance in our pet business versus our underwriting case.

Speaker Change: Significant mix improvement in value added eggs.

Speaker Change: We expect these highlights to be sustained in FY 'twenty five.

Rob Vitale: On the other side of the ledger, our refrigerator retail segment underperformed; has trade investment, cannibalized base volume without sufficient incremental lift. We are addressing the appropriate level of trade spending. Looking ahead to 25, we expect a more stable consumer environment, which, along with lapping 24, will support more favorable volume trends. The capital markets and the M&A market support further strategic action. Our leverage is at historically low levels, and we will tend to be reactive with capital allocation. Our business model and our diversification enable us to adapt to changing conditions, and we will remain clear right as we consider the best allocation of your capital.

Speaker Change: The other side of ledger, a refrigerated retail segment underperformed as trade investment cannibalize base volume without sufficient incremental lift.

Robert Vitale: We are addressing the appropriate level of trade spending. Looking ahead to 25, we expect a more stable consumer environment, which, along with lapping 24, will support more favorable volume trends. The capital markets and the M&A market support further strategic action. However, our leverage is at historically low levels, and we will tend to be reactive with capital allocation. Our business model and our diversification enable us to adapt to changing conditions, and we will remain clear-eyed as we consider the best allocation of your capital. Now Jeff will provide more context on the quarter.

Speaker Change: We are addressing the appropriate level of trade spending.

Speaker Change: Looking ahead to 'twenty five we expect a more stable consumer environment, which along with lapping 24 will support more favorable volume trends.

Speaker Change: The capital markets and the M&A market support further strategic action.

Speaker Change: Average is at historically low levels.

Speaker Change: And we will tend to be reactive with capital allocation, our business model and our diversification and enable us to adapt to changing conditions and we will remain clear eyed as we consider the best allocation of your capital.

Jeff Zadoks: Now Jeff will provide more context on the quarter.

Speaker Change: Now, Jeff will provide more context on the quarter.

Jeff Zadoks: Thanks, Rob. And good morning, everyone.

Jeff Zadoks: Thanks, Rob, and good morning everyone. Starting with PCB, both our grocery and pet food products contributed to another strong quarter of profit performance. Within grocery, cereal volumes were challenged, although we performed better than the category as we slightly increased branded share in both dollars and pounds. Carry over pricing combined with excellent operating and supply chain performance continued to be the main profit drivers within grocery. Zero category volume finished the quarter down 4.1%. Despite not seeing an immediate recovery as we lap snap this quarter, we continue to expect category volumes will normalize to the historical cager of down approximately 1 to 2%.

Jeff Statics: Thanks, Rob and good morning, everyone.

Jeff Zadoks: Starting with PCB, both our grocery and pet food products contributed to another strong quarter of profit performance. Within grocery, cereal volumes were challenged, although we performed better than the category as we slightly increased branded share in both dollars and pounds. Carrover pricing, combined with excellent operating and supply chain performance, continue to be the main profit drivers within grocery. Zero category volume finished the quarter down 4.1%. Despite not seeing an immediate recovery as we lap-snapped this quarter, we continue to expect category volumes will normalize to the historical CAGR of down approximately 1 to 2%.

Jeff Statics: Starting with P. C b, both our grocery and pet food products contributed to another strong quarter of profit performance within.

Jeff Statics: Within grocery seal cereal volumes were challenged although we performed better than the category as we slightly increased branded share in both dollars and pounds.

Jeff Statics: Carryover pricing combined with excellent operating and supply chain performance continued to be the main profit drivers within grocery.

Jeff Statics: Zero category volume finished the quarter down four 1%.

Jeff Statics: Not seeing an immediate recovery as we lap snap this quarter.

Jeff Statics: We continue to expect category volumes will normalize to the historical CAGR of down approximately 1% to 2%.

Jeff Zadoks: For the pet food business, our category share remained fairly flat in total and across our brands. Recall, however, in the last half of the prior fiscal year, our pet food sales revenues and volumes benefited from a one-time replenishment of customer inventories as we improved customer fill rates from the low 70s to the low 90s. Strong manufacturing performance continued to drive our results. The closure of our Lancaster, Ohio, Zero plant and our pet integration continue to remain on track with a planned exit from the Smuckers TSA in the first half of fiscal year 2025.

Jeff Zadoks: For the pet food business, our categories' share remains fairly flat in total and across our brands. Recall, however, in the last half of the prior fiscal year, our pet food sales revenues and volumes benefited from a one-time replenishment of customer inventories as we improved customer fill rates from the low 70s to the low 90s. Strong manufacturing performance continued to drive our results. The closure of our Lancaster, Ohio cereal plant and our PET integration continue to remain on track with a planned exit from the Smucker's TSA in the first half of fiscal year 2025.

Speaker Change: For the pet food business, our category share remained fairly flat in total and across our brands recall. However in the last half of the prior fiscal year, our pet food sales revenues and volumes benefited from a onetime replenishment of customer inventories as we improve customer fill rates from the low seventy's to the low ninety's.

Jeff Statics: Strong manufacturing performance continued to drive our results.

Jeff Statics: The closure of our Lancaster, Ohio, cereal plant and our pet integration continue remain to remain on track with a planned exit from the smokers TSA in.

Jeff Statics: In the first half of fiscal year 2025.

Jeff Zadoks: Moving to food service, we had a good quarter with very strong product mix. In addition, we benefited from the final run out of avian influenza pricing related to the November 2023 outbreak, as well as elevated customer promotions in the quarter. Overall egg vimes were flat despite slowing restaurant foot traffic. However, our mix continued to improve with 15% volume growth in our highest margin pre-cooked egg products. Lastly, we continue to encounter some delays in achieving our full RTD shake manufacturing run rate. The ramp up has been slower than we anticipated, but we made significant progress during the quarter.

Jeff Zadoks: Moving to food service, we had a good quarter with a very strong product mix. In addition, we benefited from the final runout of avian influenza pricing related to the November 2023 outbreak, as well as elevated customer promotions in the quarter. Overall, egg volumes were flat despite slowing restaurant foot traffic.

Speaker Change: Moving to foodservice, we had a good quarter with very strong product mix. In addition, we benefited from the final run out of avian influenza pricing related to the November 2023 outbreak.

Speaker Change: As well as elevated customer promotions in the quarter.

Jeff Statics: Overall egg volumes were flat despite slowing restaurant foot traffic. However, our mix continued to improve with 15% volume growth and our highest margin precooked egg products.

Jeff Zadoks: However, our mix continued to improve with 15% volume growth in our highest margin precooked egg product. Lastly, we continue to encounter some delays in achieving our full RTD shape manufacturing run rate. The ramp-up has been slower than we anticipated, but we made significant progress during the quarter. Recognizing that it is hard to track the impact of avian influenza quarter to quarter, we will share that our expectation for food service-adjusted EBITDA in the fourth quarter is approximately $100 million.

Jeff Statics: Lastly, we continue to encounter some delays in achieving our full RTD shakes manufacturing run rate.

Jeff Statics: The ramp up has been slower than we anticipated, but we made significant progress during the quarter.

Jeff Zadoks: Recognizing that it is hard to track the impact of avian influenza quarter to quarter, we will share that our expectation for food service adjusted EBITDA in the fourth quarter is approximately $100 million.

Jeff Statics: Recognizing that is hard to track the impact of avian influenza a quarter to quarter.

Jeff Statics: We will share that our expectation for foodservice adjusted EBITDA in the fourth quarter is approximately $100 million.

Jeff Zadoks: Our refrigerator retail business had a significant pullback and profitability. While we were encouraged to see dinner and breakfast size volumes up 4% and 6% respectively, this growth came with significantly higher than expected trade costs. We are recalibrating these investments and anticipates sequential segment profit improvement in the fourth quarter. From a commodity standpoint, South prices were a significant headwind versus prior year, further pressuring Q3 adjusted EBITDA for the segment. On the positive side, we continued to see strong manufacturing and cost management performance across the network.

Jeff Zadoks: Our refrigerator retail business had a significant pullback in profitability. While we were encouraged to see dinner and breakfast size volumes up 4% and 6%, respectively, this growth came with significantly higher than expected trade costs. We are recalibrating these investments and anticipate sequential segment profit improvement in the fourth quarter. From a commodity standpoint, sow prices were a significant headwind versus the prior year, further pressuring Q3 adjusted EBITDA for the segment. On the positive side, we continue to see strong manufacturing and Cost Management performance across the network.

Jeff Statics: Our refrigerated retail business had a significant pullback in profitability.

Jeff Statics: While we were encouraged to see dinner and breakfast sides volumes up 4% and 6% respectively. This growth came with significantly higher than expected trade costs.

Jeff Statics: We are recalibrating these investments and anticipate sequential segment profit improvement in the fourth quarter.

Jeff Statics: From a commodity standpoint, sow prices were a significant headwind versus prior year further pressuring Q3, adjusted EBITDA for the segment.

Jeff Statics: On the positive side, we continue to see strong manufacturing.

Jeff Statics: And cost management performance across the network.

Jeff Zadoks: Turning to Weedabix UK, zero category vines moderated to a decline of 1%, and we saw flat vines within our branded and private labeled this Schits. He continued improvement with supply chain and service levels combined with incremental pricing on some private label products, drove sequential margin improvement from Q2. In addition, the business successfully completed phase one of its ERP conversion and is on track for the second larger phase two in the fall.

Jeff Zadoks: Turning to Weetabix, UK cereal category volumes moderated to a decline of 1%, and we saw flat volumes within our branded and private label biscuits. Continued improvement with supply chain and service levels combined with incremental pricing on some private label products drove sequential margin improvement from Q2. In addition, the business successfully completed Phase 1 of its ERP conversion and is on track for the second, larger Phase 2 in the fall. With that, I'll turn the call over to Matt.

Speaker Change: Turning to Weetabix UK cereal category volumes moderated to a decline of 1% and we saw it flat volumes within our branded and private label biscuits.

Jeff Statics: Continued improvement with supply chain and service levels combined with incremental pricing on some private label products drove sequential margin improvement from Q2.

Jeff Statics: In addition, the business successfully completed phase one of its ERP conversion and is on track for the second larger phase two in the fall.

Matt Mainer: With that, I'll turn the call over to Matt.

Jeff Statics: With that I'll turn the call over to Matt.

Matt Mainer: Thanks, Jeff, and good morning. Third quarter consolidated net sales were $1.9 billion, and adjusted EBITDA was $350 million. Net sales increased 5% driven by recent acquisitions. Excluding acquisitions, sales declined 5% driven by lower overall volumes in our retail businesses and the impact of food service pricing on our food service pricing pass-through model. Supply chain performance and pill rates remain strong, while commodity inflation, on balance, is neutral. Finally, SCNA increased as we continued targeted marketing investments in our retail business. Excluding the benefit.

Matt Mainer: Thanks, Jeff.

Matt Mainer: I'm Good morning. Third quarter consolidated net sales were 1.9 billion, and adjusted EBITDA was 350 million. Net sales increased 5% driven by recent acquisitions; excluding acquisitions, sales declined 5% driven by lower overall volumes in our retail businesses and the impact of food service pricing of our food service pricing pass-through model. Supply chain performance and fill rates remain strong, while commodity inflation, on balance, is neutral. Finally, SNA increased as we continued targeted marketing investments in our retail businesses. Excluding the benefit of pet food acquisitions from both the current and prior year quarters, post-consumer brands net sales decreased 3% and volumes decreased 6%.

Matt Mainer: Thanks, Jeff and good morning.

Matt Mainer: Third quarter consolidated net sales were $1 9 billion and adjusted EBIDTA was $350 million net sales increased 5% driven by recent acquisitions, excluding acquisitions sales declined 5% driven by lower overall volumes in our retail businesses and the impact of foodservice pricing a buyer foodservice pricing pass.

Speaker Change: Their model.

Speaker Change: Supply chain performance and fill rates remained strong while commodity inflation on balance is neutral.

Jeff Statics: SG&A increased as we continued targeted marketing investments in our retail businesses.

Jeff Statics: Excluding the benefit.

Jeff Statics: Oh, the pet food acquisition from both the current and prior year quarters post consumer brands net sales decreased 3% and volumes decreased 6%.

Matt Mainer: Of pet food acquisitions from both the current and prior year quarters, post-consumer brands' net sales decreased 3% and volumes decreased 6%. Average net pricing, excluding pet food, increased 3%, volumes declined primarily in non-retail and branded cereal. Segmented adjusted EBITDA increased 28% versus the prior year as we benefited from the strong contribution of pet food and improved grocery performance. Weedavix net sales increased 1% year over year.

Matt Mainer: Average net pricing, excluding pet food, increased 3%. Viams declined primarily a non-retail in branded cereal. Segment of adjusted Evada increased 28% versus prior year as we benefited from the strong contribution of pet food and improved grocery performance. Weed of ex net sales increased 1% year over year. Sales benefited from the decide acquisition and a nominal foreign currency tailwind of 80 basis points from a stronger British Pound. On a currency and acquisition neutral basis, net sales decreased 5% and volumes decreased 6%, driven by a decline in non-viscate products. Segment of adjusted evada increased 24% versus prior year, led by the easing of commodity pressures and improved manufacturing leverage as we build inventory in the quarter ahead of our ERP go live.

Jeff Statics: Net pricing, excluding <unk> increased 3%.

Jeff Statics: Volumes declined primarily in non retail and branded cereal segment adjusted EBITDA increased 28% versus prior year as we benefited from the strong contribution of pet food and improved grocery performance.

Matt Mainer: Sales benefited from the D-side acquisition and a nominal foreign currency tailwind of 80 basis points from a stronger British pound. However, on a currency and acquisition-neutral basis, net sales decreased 5% and volumes decreased 6%, driven by a decline in non-Biscuit products. Segment Adjusted EBITDA increased 24% versus the prior year, led by the easing of commodity pressures and improved manufacturing leverage as we built inventory in the quarter ahead of our ERP go live.

Jeff Statics: <unk> net sales increased 1% year over year sales benefited from the <unk> acquisition and a nominal foreign currency tailwind of 80 basis points from a stronger British pound.

Jeff Statics: On a currency and acquisition neutral basis, net sales decreased 5% and volumes decreased 6% driven by a decline in non does get products.

Jeff Statics: Segment, adjusted EBITDA increased 24% versus prior year led by the easing of commodity pressures and improve manufacturing leverage as we build inventory in a quarter ahead of our ERP go lives.

Matt Mainer: Food service net sales decreased 5% while volumes increased 2%. Revenue reflects the pass-through of lower grain costs and in a net reduction in pricing due to the widened down of avian influenza price setters from last year. Viams reflect increases in both egg products and potato products. Adjusted Evada decreased 17% as we left the benefit of egg market imbalances and elevated avian influenza price setters in the prior year. These headwinds were partially offset by favorable mixed shift to higher margin precooked takes. Prefiduriated retail net sales decreased 7% while volumes were flat. average net prices declined as a result increased trade as a result of increased trade in the portfolio primarily for dinner sides.

Matt Mainer: Food service net sales decreased 5% while volumes increased 2%. Revenue reflects the pass-through of lower grain costs and then a net reduction in pricing due to the winding down of avian influenza price headers from last year. Biomes reflect increases in both egg products and potato products.

Jeff Statics: Foodservice net sales decreased 5% while volumes increased 2% revenue reflects the pass through of lower grain cost and then a net reduction in pricing due to the wind down of avian influenza price setters from last year.

Jeff Statics: Volumes reflect increases in both AG product Sam potato products.

Matt Mainer: Adjusted EBITDA decreased 17% as we lapped the benefit of egg market imbalances and elevated avian influenza price adders in the prior year. However, these headwinds were partially offset by a favorable mixed shift to higher-margin pre-cooked eggs. Refrigerated retail net sales decreased 7% while volumes were flat. However, average net price declined as a result of increased trade in the portfolio, primarily for dinner sites. Favorable side disc volumes were offset by distribution losses in egg products; segment adjusted EBITDA decreased 37%, reflecting lower net pricing and a significantly higher sell cost compared to the prior year.

Jeff Statics: Adjusted EBITDA decreased 17% as we lap the benefit of the AG market imbalances and elevated avian influenza price setters in the prior year. These headwinds were partially offset by a favorable mix shift to higher margin premium tax.

Jeff Statics: Refrigerated retail net sales decreased 7% while volumes were flat.

Jeff Statics: Net prices declined as a result increased trade as a result of increased trading debt portfolio, primarily for dinner sides.

Matt Mainer: Variable side-disp volumes were offset by distribution losses in egg products. Segment of adjusted Evada decreased 37%, reflecting lower net pricing and a significantly higher sell cost compared to prior year.

Jeff Statics: Favorable side dish volumes were offset by distribution losses in AG products segment, adjusted EBITDA decreased 37%, reflecting lower not pricing and a significantly higher sow cost compared to prior year.

Matt Mainer: Turning into cashflow in the third quarter, we generated 272 million from operations, driven by strong profit performance and its equal sequential improvements to working capital. Capital expenditures in the quarter were approximately 110 million, driven by continued investments in pet food capacity and the expansion of our Norwalk, Iowa, precooked egg facility. For the last 12 months, cash flow from operations was $966 million, and capital expenditures were $391 million, netting to $575 million of free cash flow. Given the strong cash flow, we maintained our net leverage at 4.3 times in the quarter, while purchasing 2 million shares at an average price of approximately $104 per share.

Matt Mainer: Turning to cash flow, in the third quarter, we generated $272 million from operations driven by strong profit performance and sequential improvements to working capital. Capital expenditures in the quarter were approximately $110 million, driven by continued investments in pet food capacity and the expansion of our Norwalk, Iowa, pre-cooked egg facility. For the last 12 months, cash flow from operations was $966 million, and capital expenditures were $391 million, netting $575 million of free cash flow.

Jeff Statics: Turning into cash flow in the third quarter, we generated $272 million from operations driven by strong profit performance and its sequel sequential improvements to working capital.

Jeff Statics: Capital expenditures in the quarter were approximately $110 million driven by continued investments in pet food capacity and.

Jeff Statics: The expansion of our Norwalk, Iowa Precooked egg facility.

Jeff Statics: For the last 12 months cash flow from operations was 966 million and capital expenditures were $391 million netting to $575 million of free cash flows.

Matt Mainer: Given the strong cash flow, we maintained our net leverage at 4.3 times in the quarter while repurchasing 2 million shares at an average price of approximately $104 per share. In the month of July, we were purchasing an additional 300,000 shares at an average price of approximately $105 per share. In addition, our board approved a new 500 million share repurchase authorization that begins next week. Finally, given the strong performance in the quarter, we again raised our guidance to a new range of 1370 to 1390. With that, I will turn the call back over to the operator for Q&A.

Jeff Statics: Given our strong cash flow, we maintained our net leverage at four three times in the quarter, while purchased repurchasing 2 million shares at an average price of approximately $104 per share in the month of July we repurchased an additional 300000 shares at an average price of approximately $105 per share.

Matt Mainer: In the month of July, we purchased an additional 300,000 shares at an average price of approximately $105 per share. In addition, our board approved a new 500 million share repurchase authorization that begins next week. Finally, given the strong performance in the quarter, we again raised our guidance to a new range of 1,370 to 1,390.

Jeff Statics: In addition, our board approved a new $500 million share repurchase authorization that begins next week.

Jeff Statics: Finally, given the strong performance in the quarter, we again raised our guidance to a new range of $13 70 to 13 90 with that I will turn the call back over to the operator for Q&A.

Operator: With that, I will turn the call back over to the operator for Q&A.

Operator: Thank you, and the floor is now open for questions. At this time, if you have a question or comment, please press star 1 on your telephone keypad. If at any point your question has been answered, you may remove yourself from the queue by pressing Star 2.

Operator: Thank you. The floor is now open for questions. At this time, if you have a question or comment, please press star 1 on your telephone keypad. If at any point your question has been answered, you may remove yourself from the queue by pressing star 2. Again, we do ask that you pick up your handset when asking your questions to provide optimal sound quality. Thank you. And our first question will come from Andrew Lazar with Barclays. Please go ahead.

Speaker Change: Thank you and the floor is now open for questions. At this time, if you have a question or comment. Please press star one on your telephone keypad. If at any point. Your question has been answered you may remove yourself from the queue by pressing star to him again, we do ask that you pick up your handset when posing your questions to provide optimal sound quality.

Operator: Again, we do ask that you pick up your handset when posing your questions to provide optimal sound quality. Thank you.

Speaker Change: Thank you and our first question will come from Andrew Lazar with Barclays. Please go ahead.

Andrew Lazar: And our first question will come from Andrew Lazar with Barclays. Please go ahead.

Andrew Lazar: Good morning, everybody. Good morning. There.

Andrew Lazar: Good morning, everybody good morning morning.

Andrew Lazar: On food service, I'm curious. You spoke to the ongoing run rate in EBITDA on that segment. I think last quarter of around 95 million, but sort of acknowledged that it had kind of been running above that, but didn't sort of family change it at that point.

Andrew Lazar: Good morning. Good morning. Hi there.

Andrew Lazar: On foodservice I'm curious you spoke to the ongoing run rate and EBITDA in that segment I think last quarter of around $95 million, but sort of acknowledged that it kind of been running above that but but didn't sort of formally changes at that point I'm curious, where you see the ongoing run rate for foodservice EBITDA now and in Portland.

Andrew Lazar: On food service, I'm curious, you spoke to the ongoing run rate in EBITDA in that segment last quarter of around $95 million, but you sort of acknowledged that it had kind of been running above that, but didn't sort of formally change it at that point. I'm curious where you see the ongoing run rate for food service EBITDA now. And partly I ask that because as we think ahead to fiscal 25, I'm trying to get a sense of whether that could be a year of your headwind, right, lapping what was a strong year in food service next year, or if you think the ongoing run rate is somewhat higher or more consistent with what we've seen this year.

Andrew Lazar: I'm curious where you see the ongoing run rate for food service EBITDA on now. And partly I ask that because, as we think ahead to fiscal 25, trying to get a sense of whether that could be a year of your headwind, right? Lapping what was a strong year in food service next year, or if you think the ongoing run rate is somewhat higher or more consistent with what we've seen this year. Sure.

Speaker Change: I asked that because as we think ahead to fiscal 'twenty five.

Speaker Change: To get a sense of whether.

Speaker Change: That could be a year over year headwind right lapping what was a strong year in foodservice next year or if you think the ongoing run rate is somewhat higher and more consistent with what we've seen this year.

Unknown Executive: Sure, Andrew. We think the run rate is around $105 million, and again, the difference between that and the $100 million is pressure we're going to see in Q4 related to avian influenza costs we're going to incur ahead of pricing kicks in.

Andrew Lazar: Andrew, we think the run rate is around 105 million. And again, a difference between that and the 100 is pressure we're going to see in Q4 related to avian influenza costs we're going to incur ahead of pricing kicking in. Yeah, and then in measured channel data for pet, which certainly does not tell the whole story.

Speaker Change: Sure Andrew we think the run rate is around $105 million and again are demonstrating that in 100 is pressure, we're going to see in Q4 related to avian influenza costs, we're going to incur ahead of pricing kicking in.

Unknown Executive: Yeah, got it. And then in measured channel data for PET, which certainly does not tell the whole story, it looked like consumption decelerated pretty meaningfully on a sequential basis in the quarter. And I guess I'm trying to get a sense of whether something sort of changed in terms of maybe not seeing as much trade down to mainstream in PET as you had been seeing, and if the planned reinvestment has sort of started to kick in yet, or if that's still to come.

Speaker Change: Got it and then in measured channel data for pet, which certainly does not tell the whole story it looked like consumption decelerated pretty meaningfully on a sequential basis in the quarter.

Andrew Lazar: It looked like consumption decelerated pretty meaningfully on a sequential basis in the quarter. And I guess I'm trying to get a sense of whether something sort of changed in terms of maybe not seeing as much trade down to mainstream in pet as you had been seeing.

Speaker Change: And I guess.

Speaker Change: To get a sense of whether something sort of changed in terms of maybe not seeing as much trade down to mainstream and Pat as you had been seeing.

Andrew Lazar: And if the plan reinvestment has sort of started to teach him yet, or if that's still to come. Yeah, Andrew, really two drivers there. One, there's actually seasonality in the pet food category. So you do see a pullback between Q2 and Q3 every year. The other piece for us, though specifically, was we had new distribution gains in Q2. So there was a pipeline fill in particular for Nine Lives. So those are the two components of the sequential decline; other than that, we're kind of in line with where we expect to be.

Speaker Change: And if the planned reinvestment has sort of started to kitchen, yet or if that's still to come.

Unknown Executive: Yeah, Andrew, really two drivers there. One, there's actually seasonality in the pet food category, so you do see a pullback between Q2 and Q3 every year. The other piece for us, though, specifically was we had new distribution gains and Q2. So there was a pipeline fill, in particular for nine lives. So those are the two components of the sequential decline. Other than that, we're kind of in line with where we expect to be.

Speaker Change: Yeah, Andrew really two drivers there one theres actually a seasonality in the pet food category. So you do see a pullback between Q2 and three Q3 every year.

Speaker Change: The other piece for US specifically it was we had new distribution gains.

Speaker Change: And Q2, so there was a pipeline fill and particular for nine lives.

Speaker Change: So those are the two components of the sequential decline other than that we're kind of in line with where we'd expect to be got it and then lastly, just on.

Robert Vitale: And lastly, just last quarter, I think, Rob, you mentioned having seen a meaningful increase in sort of the M&A pipeline. You mentioned private equity-owned assets have sort of aged and such, and I'm trying to get a sense. Obviously, your leverage is now lower than it's been in a while, and you've been taking advantage of that around share repo, but any change to sort of that M&A landscape, one way or the other, that you've seen since last quarter? No. If anything, it's accelerated in terms of the...

Andrew Lazar: And lastly, just last quarter, I think Rob, you mentioned having seen a meaningful increase in sort of the M&A pipeline. You mentioned private equity owned assets have sort of aged and such. And trying to get us any obviously leverages now lower than it's been in a while. And you've been taking advantage of that around share repo.

Speaker Change: I'll ask last quarter, I think Rob you mentioned, having seen a meaningful increase in sort of the M&A pipeline, you mentioned private equity owned assets have sort of aged and such.

Speaker Change: Trying to get a sense obviously your leverage is now lower than it's been in a while and you've been taken advantage of that around share repo, but any change to sort of that M&A landscape, one way or the other that you've seen since last quarter.

Rob Vitale: But any change to sort of that M&A landscape one way or the other that you've seen since last quarter. No, if anything, it's accelerated in terms of the amount of opportunities we've been considering. Obviously, we take our time and considering those, and the pipeline may take a long time to mature to a deal. But Barker feels very active right now.

Robert Vitale: If anything, it's accelerated in terms of the amount of opportunities we've been considering. Obviously, we take our time considering those, and the pipeline may take a long time to mature to a deal. But the market feels very active right now.

Speaker Change: Anything it has accelerated in terms of the amount of opportunities we've been considering.

Speaker Change: Obviously, we take our time and considering those in the pipeline may take a long time to mature to a deal but market feels very active right now.

Andrew Lazar: Thanks so much.

Speaker Change: Thanks, so much.

Speaker Change: Thank you.

David Palmer: Our next question will come from David Palmer with Evercore ISI. Please go ahead. Thanks and good morning.

David Palmer: Our next question will come from David Palmer with Evercore ISI.

Speaker Change: Our next question will come from David Palmer with Evercore ISI. Please go ahead.

David Palmer: Thanks and good morning. I'm just going to continue on that line of questioning about how you're feeling heading into fiscal 25. I'm wondering how you feel about pet synergies, productivity, visibility, anything that kind of gives you a dry powder for what seems to be a starting point where you're going to want to stabilize volume in a pet Post Consumer Brands. Volume is down 6%. I would imagine that you'll want to dial up promotion spending to address that. So I'm just thinking about things that could be incremental. You know, you mentioned the TSA sunsetting with Smucker. Any thoughts about how the gives and takes for 25s would be helpful? Thanks.

David Palmer: Thanks, and good morning.

David Palmer: I'm just going to continue on that line of questioning about how you're feeling heading into Fiscal 25. I'm wondering how you're feeling about pet synergies, productivity, visibility, anything that kind of gives you a dry powder for what seems to be a starting point where you're going to want to stabilize volume in a pet's post consumer brand volume is down 6%. I would imagine that you'll want to dial up promotion spending to address that. So I'm just thinking about things that could be incremental. You mentioned the TSA sunsetting with Smucker. Any thoughts about how the gives and takes for 25 would be helpful.

David Palmer: I'm just oney can continue on that line of questioning about how you're feeling heading into fiscal 'twenty five.

David Palmer: I'm wondering.

David Palmer: How you're feeling about pet.

Speaker Change: Pet synergies productivity visibility anything that kind of gives you.

Dry powder or for what seems to be a starting point, where you're going to want to stabilize volume and Opex post consumer brands volume was down 6% I would imagine that you'll want to dial up promotion spending to address that so I'm just thinking about things that could be incremental you you mentioned the TSA sunsetting.

Speaker Change: With smucker any any thoughts about how the gives and takes for 25 would be helpful. Thanks.

David Palmer: Thanks.

Unknown Executive: Yes, so on the serial side, obviously, we've got the Lancaster closing that's on track to be a contribution to the positive, so that's right-sizing some capacity or overcapacity we have now, and then I would say beyond that. In post-consumer brands, just your comment about down 6%, there were a couple factors in the quarter around serial volumes. We were really in line with the category. Beyond that, we saw a discontinuation on our side with some skew rationalization in Canada, and then also we've seen just a general pullback in KCCO or government volumes in terms of bid business across the board, but those are really the two outliers relative to category performance on our own, but I would say Lancaster's the positive to offset some of what you talked about in potential volume pressures.

Rob Vitale: Yes, so on the serial side, obviously we've got the Lancaster closing that's on track of the contribution to the positive. So that's right sizing some capacity or over capacity we have now.

Speaker Change: Yes, so on the on the cereal side, obviously, you've got the Lancaster closing Thats on track to via <unk> contribution to the positive.

Speaker Change: Right sizing some capacity or overcapacity, we have now.

Rob Vitale: And then I would say, beyond that. In post-consumer branches, you're coming about down 6%. There were a couple factors in the quarter around serial volumes. We were really in line with the category beyond that. We saw a discontinuation on our side with some ski rationalization in Canada. And then also we've seen just a general pullback in KCCO or government volumes in terms of business across the board. But those are really to the two outliers relative to category performance in our own. But I would say Lancasters. The positive offset some of what you talked about and potential volume pressures.

Speaker Change:

Speaker Change: Then.

Speaker Change: I would say.

Speaker Change: Beyond that.

Speaker Change: And post consumer brands, just your comment about down 6% there were a couple of factors in the quarter around cereal volumes, we were really in line with the category beyond that we saw a discontinuation on our side with some SKU rationalization in Canada and then also we had.

Speaker Change: Just a general pullback in K C C O or government volumes in terms of bad business across the board, but those are really two that the two outliers relative to category performance and our own but I would say Lancaster is.

Speaker Change: The positive to offset some of what you talked about a potential volume pressures.

Speaker Change: Okay.

Rob Vitale: Any any any you want to give us an estimate of what that could mean to even down the timing of that in fiscal 25. We talked about Lancaster is being a $25 million contribution for the full year. And we're on track to be there. So again, to your point, there's, you know, volume, volume pressures. If they persist, there could be promotional. Although we're pretty rational in terms of our promotional outlook.

Unknown Executive: Any, any, do you want to give us an estimate of what that could mean to EBITDA and the timing of that in fiscal 25?

Speaker Change: Any any.

Speaker Change: Can you give us an estimate of what that could mean to EBITDA and the timing of that in fiscal 'twenty five.

Unknown Executive: We talked about Lancaster as being a $25 million contribution for the full year, and we're on track to be there. So again, to your point, there are volume pressures if they persist. There could be promotional pressure, although we're... pretty rational in terms of our promotional outlook.

Speaker Change: We talked about Lancaster is being a $25 million contribution for the full year and we're on track to be there. So again to your point, there's volume volume pressures, if they persist there could be promotional although or warehouse.

Speaker Change: Pretty rational in terms of the promotional outlook.

David Palmer: Great. Thank you.

Speaker Change: Yeah.

David Palmer: Great. Thank you.

Speaker Change: Great. Thank you.

Speaker Change: Yeah.

Ken Goldman: Our next question will come from Ken Goldman with JP Morgan. Please go ahead. Hi, two quick ones to start if I may one. I didn't quite hear you on the TSA timing. Is that shifting the exit into 2025 now? I think it was previously scheduled for the fourth quarter of this year. Please correct me if that's not right.

Kenneth Goldman: Our next question will come from Ken Goldman with J.P. Morgan. Please go ahead.

Speaker Change: Our next question will come from Ken Goldman with J P. Morgan. Please go ahead.

Kenneth Goldman: Hi, two quick ones to start if I may. One, I didn't quite hear you on the TSA timing. Is that shifting the departure into 2025 now? I think it was previously scheduled for the fourth quarter of this year. Please correct me if that's not right. And then I also was hoping for an update on the timing of the Michael plan. I wasn't sure if we had heard that.

Ken Goldman: Hi, two quick ones to start if I may one.

Ken Goldman: I didn't quite hear you on the TSA timing is that shifting the exit into 2025 now I think it was previously scheduled for the fourth quarter of this year.

Speaker Change: Please correct me if that's not right and then I also was hoping for an update on the timing of the Michael plan I wasn't sure. If we had heard that.

Rob Vitale: And then I also was hoping for an update on the timing of the Michael plan. I wasn't sure if we had heard that. So the TSA was Smucker. There's no change in the timing. There's a part of the co-pack arrangement that lingers into the first part of fiscal 25. But we're on target to exit the back office TSA at the end of our fiscal year.

Unknown Executive: So the TSA was smuggled, there's no change in the timing, there's a part of the COPAC arrangement that lingers into the first part of fiscal 25, but we're on target to exit the back office TSA at the end of our fiscal year. And then the question about food service, could you say that again?

Speaker Change: So that the TSA with Smucker Theres no change in the timing, there's a part of the co pack arrangement that lingers into the first part of fiscal 'twenty five, but we're on target to exit the back office TSA at the end of our fiscal year and then the question about foodservice because you say that again.

Rob Vitale: And then the question about food service.

Rob Vitale: Could you say that again? I just didn't understand if there was any change in the guidance on the timing of the Michael plant opening. No, we didn't; our preparatory remarks didn't comment about that. But the timing of Norwalk, if that's what you're talking about, the expansion of our protein shakes. Oh, thank you. I'm not saying it clearly, but yes, thank you. Yeah, no, the plant is open. It's the; it's just our ramp up has been slower than we expected. So, so I guess the way to put it is, yes, the profitability from that, our expected profitability from that has been delayed.

Speaker Change: I just didn't understand if if there was any change in the guidance on the timing of the Michael plant opening.

Unknown Executive: No, we didn't. Our prepared remarks didn't comment on that, but the timing of Norwalk, if that's what you're talking about, the expansion of Norwalk. Thank you. I'm not saying it clearly, but yes, thank you.

Speaker Change: No we didn't.

Speaker Change: Our prepared remarks didn't comment about that but the timing of Norwalk, if that's what you're talking about the expansion of most of that amount of protein shakes.

Speaker Change: Thank you I think I'm, not saying, it's pretty early but yes. Thank you yeah no that the plant is open it's the it's just a ramp up has been slower.

Speaker Change: Slower than we expected. So so I guess that the way to put it is yes, the profitability from that or expected profitability from that has been delayed beyond what we had previously communicated.

Rob Vitale: Beyond what we had previously communicated. Okay, thank you.

Kenneth Goldman: And then one more, if I can, just on SG&A. You know, broadly over the last 12 months, your SG&A has grown much more rapidly than your sales. And I know you've talked about increasing marketing, but it brings your SG&A as a percentage of sales over the last 12 months back up to kind of the range it was, you know, for many years, around that kind of mid-18% until it dipped in the last couple of years.

Speaker Change: Okay. Thank you and then one more if I can just on SG&A.

Ken Goldman: And then one more, if I can just on SGNA, you know, broadly over the last 12 months, your SGNA has grown much more rapidly than your sales. And I know you're talking; you've talked about increasing marketing, but it brings now your SGNA as a percentage of sales over the last 12 months back up to kind of the range it was, you know, for many years around that kind of mid 18% until it did the last couple of years.

Speaker Change: You know broadly over the last 12 months. Your SG&A has grown much more rapidly than your sales and I know you talked you've talked about increasing marketing, but it brings now your SG&A as a percentage of sales over the last 12 months back up to kind of the range. It was.

Speaker Change: For many years ran that kind of mid 18% until it get the last couple of years I'm. Just curious is it fair to kind of think about this percentage is a good number to model ahead understanding of NEP will never stay exactly there or are there reasons to kind of think that SG&A dollars will continue to rise at a meaningfully faster pace than revenue.

Kenneth Goldman: I'm just curious, is it fair to kind of think about this percentage as a good number to model ahead, you know, understanding that it will never stay exactly there? Or are there reasons to kind of think that SG&A dollars will continue to rise at a meaningfully faster pace than revenue?

Rob Vitale: I'm just curious, is it fair to kind of think about this percentage as a good number to model ahead, you know, understanding it will never stay exactly there, or the reasons to kind of think that SGNA dollars will continue to rise at a meaningfully faster pace than revenue. Yeah, I think a couple of things you mentioned A and C, we definitely have some targeted additional investments there that we may recalibrate also given the overperformance in the portfolio. There's some definitely some elevated step or bonus within some of our cat or some of our segments as well that would reset next year.

Unknown Executive: Yeah, I think a couple things you mentioned ANC; we definitely have some targeted additional investments there that we may recalibrate. Also, given the overperformance in the portfolio, there's definitely some elevated steps or bonuses within some of our categories, some of our segments as well that would reset next year.

Speaker Change: Yeah, I think a couple of things you mentioned ANC, we definitely have some targeted additional investments there. We may recalibrate also given the over performance in the portfolio. There is some definitely some elevated step our bonus within some of our some of our segments as well that would reset next year.

Ken Goldman: Okay, thank you.

Speaker Change: Okay. Thank you.

Matt Smith: Our next question will come from Matt Smith with Steve. Please go ahead.

Matthew Smith: Our next question will come from Matt Smith with Stiefel.

Speaker Change: Our next question will come from Matt Smith with Stifel.

Speaker Change: Please go ahead.

Matt Smith: Hi, good morning. I wanted to go back to the food service business. You have a, you have the expanded capacity coming online at Norwalk. Could you remind us when that capacity comes online and your visibility and the pipeline of filling that capacity and what it could mean for further distribution opportunities?

Matthew Smith: Hi, good morning. I wanted to go back to the food service business. You have the expanded capacity coming online at Norwalk. Could you remind us when that capacity comes online and your visibility into the pipeline of filling that capacity and what it could mean for further distribution opportunities?

Matt Smith: Hi, Good morning, I wanted to go back to the foodservice business you have a you have the expanded capacity coming online at Norwalk could you remind us when that capacity comes online and your visibility into the pipeline of filling that capacity and what it could mean for further distribution opportunities.

Unknown Executive: Yeah, we still have another year of construction or so on Norwalk, so that would really be fiscal 26 when that would come online, and then there'd be a ramp period that's typically, you know, could be as long as 12 months in terms of filling that plan.

Matt Smith: Yeah, we still have another year of construction or so on Norwalk, so that would really be fiscal 26 when that would come online, and then there'd be a ramp period that's typically, you know, could be as long as 12 months in terms of filling that plan. Thank you for that.

Speaker Change: Yeah, we still have another year of construction or so on Norwalk, So that would really be fiscal 'twenty six one that would come online and then there'd be a ramp period, that's typically it could be as long as 12 months.

Speaker Change: In terms of filling that plant.

Matthew Smith: Thank you for that. And if we could move to the refrigerator retail business, you invested in some promotional activity to bring consumers back into your stores to induce trial and get consumers to trade back up into your brands. Can you talk about why the lift wasn't as strong as you had anticipated and where you go from here to improve your volume trajectory?

Speaker Change: Thank you for that and if we could move to the refrigerator retail business you invested in some promotional activity to them.

Matt Smith: And if we could move to the refrigerator retail business, you invested in some promotional activity to bring consumers back into or to induce trial and get consumers to trade back up into your brands.

Speaker Change: Bring consumers back into her two to induce trial and get consumers to trade back up into your brands can you talk about the why the lift wasn't as strong as you had anticipated and where you go from here too.

Matt Smith: Can you talk about why the lift wasn't as strong as you had anticipated and where you go from here to improve your volume trajectory? Sure, so again, we mentioned we're recalibrating that. Honestly, we just, we overshot. There's a bit of a look back on that as well. It's kind of a six-month tail. So some of this is Q2 related as well. But we'll get the full tally of the spends there. We just didn't see the lifts in Q2 and Q3 to support the amount we spent in terms of promo. Again, we're recalibrating that. But I did what happened; essentially, is, you know, this quarter's example was a 4% increase in size.

Speaker Change:

Speaker Change: To improve your volume trajectory.

Unknown Executive: Sure. So again, we, as we mentioned, are recalibrating that. Honestly, we just overshot. There's a bit of a look back in that as well. It's kind of a six month tail.

Speaker Change: Sure. So again, we as we mentioned we're recalibrating that honestly, we just we overshot theres a bit of a look back on that as well, it's kind of a six month sales. So some of those as Q2 related as well, but and we'll get the full tally.

Unknown Executive: So some of this is Q2 related as well, but we get the full tally of the spends there. We just didn't see the lifts in Q2 and Q3 to support the amount we spent in terms of promotion. Again, we're recalibrating that. But what happened essentially is, you know, this quarter's example was a 4% increase in sides. I think to support that level of spend, we would have expected something north of 10. And instead, we subsidized some base sales that were on promotion, which deteriorated profitability.

Speaker Change: Of the spends there we just didn't see the lift in Q2 and Q3 to support the amount. We spent in terms of promo again, we're recalibrating that.

Speaker Change: But I think what happened essentially as you know this quarter as an example was a 4% increase in sides I think to support that level of spend we would have expected something north of 10, and instead, we subsidize some base based sales that were on promotion, which deteriorated profitability.

Matt Smith: I think the support that level of spend we would have expected something north of 10. And instead, we subsidized some base, base sales that were on promotion, which deteriorated profitability. And you mentioned a longer look back period for those promotional events. Are you able to recalibrate that fairly quickly? Or does that take a couple of quarters to pull planned promotions out of the market?

Unknown Executive: And you mentioned a longer look-back period for those promotional events. Are you able to recalibrate that fairly quickly? Or does that take a couple of quarters to pull planned promotions out of the market? Yep, we do.

Speaker Change: And you mentioned a longer look back period for those promotional events are you able to recalibrate that fairly quickly or does that take a couple of quarters to pull planned promotions out of the market. Yes. We are I mean, I think with the knowledge of that again I think as a reminder, just as a comparison to a cereal I think is a good analogy is.

Unknown Executive: Yep, we are. I mean, with the knowledge of that, again, I think as a reminder, just as a comparison to cereal, which is a good analogy, is, you know, cereal is a very mature category with a lot of history behind promotions. As a reminder, we haven't been able to promote in refrigerated retail, a much different category than cereal; we just don't have that history. So we definitely underestimated the level of promotional activity that happened.

Speaker Change: <unk> is a very mature category with a lot of history behind promotions. As a reminder, we haven't been able to promote and refrigerated retail are much different category than cereal. We just don't have that history. So definitely underestimated the level of promotional activity that happened.

Matt Smith: There's a different category than cereal. We just don't have that history. So definitely underestimated the level of promotional activity that happened. But we have recalibrated the accrual and our expectations in the quarter. So we feel like we have a ring fence and adjusting that going forward. So we feel like we've got a good, good handle on it.

Speaker Change:

Matthew Smith: But we have recalibrated the accrual and our expectations for the quarter, so we feel like we have it ring-fenced and are adjusting that going forward. So we feel like we've got a good handle on it.

Speaker Change: But here, we have recalibrated, the accrual and our expectations in the quarter. So we feel like we have it ring says and adjusting that going forward. So we feel like we've got a good a good handle on it.

Matt Smith: Thank you, Matt.

Michael Lavery: Thank you, Matt. I'll pass it on.

Speaker Change: Thank you, Matt I'll pass it on.

Matt Smith: I'll pass it on.

Michael Lavery: Our next question will come from Michael Lavery with Piper Sandler. Please go ahead. Thank you.

Michael Lavery: Our next question will come from Michael Lavery with Piper Fandler.

Speaker Change: Our next question will come from Michael Lavery with Piper Sandler.

Speaker Change: Please go ahead.

Michael Lavery: Thank you good morning, good morning.

Michael Lavery: Good morning. You mentioned how branded cereal is outperforming private label. But we keep you also hearing so much about how the consumer is stretched. How do you maybe just reconcile the cereal dynamics? And I think you also said you expect a little bit more stable. The consumer to be in a maybe stable at least or a little bit better place in fiscal 25 is a little bit of read through from cereal or how do we think about where the consumer is there?

Michael Lavery: You mentioned how branded cereal is outperforming private label, but we keep also hearing so much about how the consumer is stretched. How do you maybe just reconcile the serial dynamics? And I think you also said you expected a little bit more stability, you know, the consumer to be in maybe a stable at least or a little bit better place in fiscal 25. Is someone better read through from serial? Or how do we think about where the consumer is?

Michael Lavery: You mentioned, how branded cereal is outperforming private label, but we keep you're also hearing so much about how the consumer is stretched.

Michael Lavery: How do you maybe just reconcile material dynamics and I think you also said you.

Speaker Change: A little bit more stable.

Michael Lavery: The.

Speaker Change: And Ah maybe stable at least are a little bit better place in fiscal 'twenty. Five is just a little bit of read through from cereal or.

Speaker Change: How do we think about where the consumer is there well let me start with the initial comment private label outperformed branded in the quarter. So Oh, sorry, Okay, I misheard that.

Robert Vitale: Let me start with the initial comment: private label outperformed branded in the quarter. Oh, sorry. I must have heard that.

Rob Vitale: Let me start with the initial comment: private label outperform branded in the quarter. Oh, sorry. Okay. I must have heard that. And I think the comment around the consumer behavior going forward is more about the acceptance of the pricing environment that has moved so rapidly and has taken some time to grow accustomed to. So it feels like, you know, we intentionally use the word that the consumers in a transitional mode in that we are now going from a super hot labor market to a cooling labor market, cooling inflation. So I think that it should be generally constructive for volumes to get past the reference price adjustment.

Robert Vitale: And I think the comment around consumer behavior going forward is more about the acceptance of the pricing environment that has moved so rapidly and has taken some time to grow accustomed to. So it feels like, you know, we intentionally use the word that the consumer is in a transitional mode. In that we are now going from a super hot labor market to a cooling labor market, and inflation is cooling off. So I think that it should be generally constructive for volumes to get past the reference price adjustment.

Speaker Change: And I think the comment around the consumer behavior going forward is more about the.

Speaker Change: Acceptance of the pricing environment that has moved so rapidly and it's taken some time to grow accustomed to so it feels like you know we intentionally use the word that the consumers in that transitional mode.

Speaker Change: And that we are now going from a super Hot labor market to a cooling labor market cooling inflation. So I think that it should be generally constructive for volumes to get past the reference.

Speaker Change: Reference price adjustment.

Rob Vitale: And it should be constructive for more value products as we see a bit of a cooling in a labor market. So we tend to think that the consumer environment will be more constructive next year on balance, but there are certainly some puts and takes.

Robert Vitale: And it should be constructive for more value products as we see a bit of a cooling in the labor market. So, we tend to think that the consumer environment will be more constructive next year on balance, but there are certainly some puts and takes.

Speaker Change: And it should be constructive for more value products as we see a bit of a cooling in the labor market. So.

Speaker Change: We tend to think that the consumer environment will be more constructive next year on balance, but there's certainly some puts and takes.

Rob Vitale: And would you characterize that as likely across all your categories, or do you have somewhere you would call out maybe more likely to see extended pressure? Certainly, it's zero given its maturity. We continue to believe within the Bob Evans brand. There are opportunities to do considerably better. You know, again, as Matt mentioned, we let our trade skills get a bit rusty, having been through a period of which we didn't really try to create demand. Value added eggs continues to outperform the overall volume trends broadly across food, both away from home and in home. So I think the comments would be most applicable as serial with varying degrees of application to the other categories.

Robert Vitale: And would you characterize that as likely across all your categories, or do you have somewhere you would call out, maybe more likely to see extended pressure?

Speaker Change: And would you characterize that as likely across all your categories or do you have somewhere you would call out maybe more likely that the extended pressured.

Robert Vitale: Certainly, in cereal, given its maturity, we continue to believe within the Bob Evans brand there are opportunities to do considerably better. Again, as Matt mentioned, we let our trade skills get a bit rusty, having been through a period in which we didn't really try to create demand. Value-added eggs continue to outperform the overall volume trends broadly across food, both away from home and in-home. So I think the comments would be most applicable to cereal, with varying degrees of application to the other categories.

Speaker Change: Certainly a serial given its maturity we continue to believe within the Bob Evans brand there are opportunities to do considerably better you know again as Matt mentioned.

Speaker Change: We let our trade skills could a bit rusty I haven't been through a period of which we didn't really try to create demand.

Speaker Change: Value added eggs continues to outperform the overall volume trends broadly across food both away from home and at home. So I think the comments would be most applicable cereal with varying degrees of application to the other categories.

Michael Lavery: That's helpful.

Unknown Executive: That's helpful. And just on pets, can you give an update on kind of the spending trajectory and how to think about just timing and where that's directed in terms of, you know, kind of which brands and how that's playing out? And when you say spending trajectory, do you mean

Speaker Change: That's helpful and just on pet can.

Michael Lavery: And just on pet, can you give an update on kind of the spending trajectory and how have they about just timing and where that's directed in terms of, you know, kind of which brands and how that's playing out? And when you say spending trajectory, you mean of incremental investment and things like advertising? Exactly, yeah. It's mostly around our more premium brands that are larger.

Speaker Change: Can you give an update on kind of the spending trajectory.

Speaker Change: Or how how to think about just timing and where that's directed in terms of kind of which brands and how that's playing out.

Unknown Executive: And when you say spending trajectory, do you mean incremental investment in things like advertising? But exactly, yeah.

Speaker Change: And when you say spending trajectory, you mean of incremental investment in things like advertising.

Speaker Change: Exactly yeah.

Unknown Executive: It's mostly around our more premium brands that are larger. So, you know, I don't want to get into details around a particular cadence and spend. But I mean, you can look at the portfolio and intuit where we would choose to invest.

Speaker Change: It's mostly around a more premium brands.

Speaker Change: At our larger so no I don't want to get into details around a particular cadence in spend but I mean, you can look at the portfolio and Intuit, where we would choose to invest.

Michael Lavery: So, no, I don't want to get into details around particular cadence and spend, but I mean you can look at the portfolio and into it where we would choose to invest. Okay, thanks so much.

Speaker Change: Okay. Thanks, so much.

Speaker Change: Thank you.

John Baumgartner: Our next question comes from John Baumgartner with Mizzouho Securities. Please go ahead. Good morning.

John Baumgartner: Our next question comes from John Baumgartner with Mizuho Securities. Please go ahead.

Speaker Change: Our next question comes from John Baumgartner with Mizuho Securities. Please go ahead.

John Baumgartner: Good morning, thanks for the questions. First off, coming back to refrigerated retail and the trade promo, just to clarify, Matt, if I remember correctly, last quarter, I think there were some customer-funded promotions that I think seemed promising in terms of the consumer response. And you mentioned that the dust is still settling here in Q3, but were there any material changes in terms of type of outlet, type of program, or maybe even geography relative to the customer-funded approach from Q2?

John Baumgartner: Thanks for the questions. Maybe first off, coming back to refrigerated retail and the trade promo, just to clarify that if I remember correctly last quarter, I think there were some customer-funded promotions that I think seem, you know, promising in terms of the consumer response.

Speaker Change: Good morning, Thanks for the questions.

Speaker Change: Sure, maybe first off coming back to refrigerated retail and the trade promo just to clarify Matt.

John Baumgartner: If I remember correctly last quarter I think there were some customer funded promotions that I think seen promising in terms of the consumer response and you mentioned the dust is still settling here on Q3, but were there any material changes in terms of type of outlet type of program or maybe even geography relative to the customer funded approach from Q2.

John Baumgartner: And you mentioned the dust is still settling here on Q3, but were there any material changes in terms of, you know, type of outlet, type of program, or maybe even geography relative to the customer funded approach from Q2. No, the comment on customer was really around Q1 and that was during the holiday season. So that would be maybe the different dynamic is, you know, that's the peak season where we're seeing, you know, really good volumes. And then, you know, a little bit of seasonality in Q2, and then there is no seasonality benefit in Q3. But I would say that's really the difference, which is Q1 is a very, very strong quarter.

Unknown Executive: No, I mean that comment on customers was really around Q1, and that was during the holiday season. So maybe the different dynamic is, you know, that's the peak season where we're seeing really good volumes, and then you know a little bit of seasonality in Q2 And then there is no seasonality benefit in Q3. But I would say that's really the difference, which is that Q1 is a very, very strong quarter.

Speaker Change: No I mean the.

Speaker Change: The comment on customer was really around Q1 and that was during the holiday season, So that would be maybe at a different dynamic as you know that's the peak season, where we're seeing.

Speaker Change: No.

Speaker Change: Really good volumes and then a little bit of seasonality in Q2, and then there is no seasonality benefit in Q3, but I would say that's really the difference which is Q1 is a very very strong quarter.

John Baumgartner: Okay, thanks for that.

Speaker Change: Okay and then.

John Baumgartner: Okay. And. Okay, thanks for that.

Robert Vitale: And then Rob, why don't we come back to food service and the volume growth there? Are there certain segments within away from home where your distribution growth is skewing in particular? And then for your existing business, the exposure to breakfast, are you seeing any sort of shift within that day part where precooked eggs are particularly resilient, or if there's more trading down to less expensive items? You mentioned eggs are outperforming, but I'm not sure if that's just due to a smaller base effect relative to other offerings that are out there. Maybe it's too granular, but I'd be just curious if you have any observations on sell through more broadly at retail. Thank you. Yeah, the

Speaker Change: Okay. Thanks for that.

Rob Vitale: And then Rob wanted to come back to food service and the volume growth there.

Speaker Change: And then Rob wanted to come back to the foodservice and the volume growth. There are there certain segments within our away from home where your distribution growth is skewing in particular and then for your existing business. The exposure to breakfast are you see any sort of shifts within that day part where pre cooked eggs are are particularly resilient or if theres more trading down to less.

Rob Vitale: Are there certain segments within away from home where your distribution growth is skewing in particular. And then for your existing business, the exposure to breakfast, are you seeing any sort of shifts within that day part where precooked eggs are particularly resilient or if there's more trading down to less expensive items. You mentioned eggs are outperforming, but I'm not sure if that's just due to a smaller base effect relative to other offerings that are out there and maybe it's too granular, but just curious if you have any observations on so through more broadly at retail.

Speaker Change: Expensive items, you mentioned eggs are outperforming but I'm not sure. If that's just due to a smaller base effect relative to other offerings that are out there and maybe it's too granular, but just curious if you have any observations on sell through of more broadly on retail. Thank you yeah. The pre cooked business, which is the highest value add and highest margin businesses.

Rob Vitale: Thank you. Yeah, the precooked business, which is the highest value add and highest margin businesses, continuing to perform very well. In fact, a group 50% volumetrically over the quarter. We are seeing changes in some of the foot traffic patterns across restaurants and QSRs, which I'm sure you've seen reported by some of the larger ones that have been within the last couple of weeks. So there is some offset in terms of where that business could be going, but the value proposition of that particular product is such that it's a great way to take labor out of back-of-house operations.

Robert Vitale: Yeah, the pre-cooked business, which is the highest value-add and highest-margin business, is continuing to perform very well. In fact, it grew 50 percent volumetrically over the quarter. We are seeing changes in some of the foot traffic patterns across restaurants and QSRs, which I'm sure you've seen reported by some of the larger ones that have been open within the last couple of weeks. So there is some offset in terms of where that business could be going, but the value proposition of that particular product is such that it's a great way to take labor out of back-of-house operations, and we think it will continue to be a long-term trend, irrespective of the short-term vagaries of some of the foot traffic issues.

Speaker Change: Continuing to perform very well in fact grew 15% volumetric Lee over the quarter.

Speaker Change: We are seeing changes in some of the oh foot traffic patterns across restaurants in Q S ours.

Speaker Change: Which I'm sure you've seen reported by some of the larger ones that have been within the last couple of weeks. So there is some offset in terms of where that business could be going but the value proposition of that particular product is such that it's a great way to take labor out of back of house operations, and we think it will continue.

Rob Vitale: And we think it will continue a long-term trend irrespective of the short-term vagaries of some of the foot traffic issues.

Speaker Change: Continue a long term trend irrespective of the short term vagaries of some of the foot traffic issues.

John Baumgartner: Thanks, Rob. Thanks, Matt.

Rob Vitale: Thanks, Rob.

Matt: Thanks, Rob Thanks, Matt.

Rob Dickerson: And our next question comes from Rob Dickerson with Jeffries. Please go ahead. Great.

Rob Dickerson: And our next question comes from Rob Dickerson with Jeffreys. Please go ahead.

Speaker Change: And our next question comes from Rob Dickerson with Jefferies.

Speaker Change: Please go ahead.

Rob Dickerson: Great, thanks so much. Rob, just around the commodity complexes, you kind of think through, you know, next year, are there any potential kind of offsetting benefits, maybe in some of the grain, the more grain-based categories in which you play that, you know, could help support profitability kind of despite some of this volume pressure if it weren't to correct immediately, on top of, let's say, you know, some of the right sizing of capacity?

Rob Dickerson: Hi, great. Thanks, so much.

Rob Dickerson: Thanks so much. Just around the commodity complex, you kind of think through, you know, next year. Are there any potential kind of offsetting benefits maybe in some of the grain, the more grain based categories in which you play that could help support profitability and despite some of this volume pressure, it worked to correct immediately on top of, let's say, you know, some of the right sizing of capacity. You know, as we look at it, as we look at it right now, there's fairly balanced benefits, as you mentioned, from grains, but then there's some offsetting inflationary items, such as packaging and sugar, as a couple of examples.

Speaker Change: Rob.

Speaker Change: Just around the commodity complex as you kind of think through you know our next.

Speaker Change: Next year, you know are.

Speaker Change: Are there are there any potential kind of offsetting benefits maybe in some of the green the more grain based categories in which you play that could help support.

Speaker Change: Profitability kind of despite some of this volume pressure at work to correct immediately.

Speaker Change: On top of lets say some of the right sizing of.

Speaker Change: We have capacity.

Unknown Executive: You know, as we look at it, as we look at it right now, there are fairly balanced benefits, as you mentioned, from grains. But then there are some offsetting inflationary items, such as packaging and sugar, as a couple of examples. So I don't think we see it as a huge benefit. But at the same time, we're not currently expecting it to be a huge detriment either. So it is fairly balanced as we head into the next fiscal year.

Speaker Change: As we look at it as well.

Speaker Change: We look at it right now there's a fairly balanced benefits as you mentioned from grains, but then there are some offsetting.

Speaker Change: Inflationary items such as packaging.

Speaker Change: And sugar.

Speaker Change: There's a couple of examples so.

Rob Dickerson: So I don't think we see it as a huge benefit; at the same time, we're not currently expecting it to be a huge detriment either. So fairly balanced as we head into the next this year. All right, cool. And then just quickly I'll read it back. You know, you called out in a release and comments just a margin up tick offered some, I guess, price. It sounds like maybe you know part of that portfolio. The margin up sick was was impressive right on a sequential but then also on your basis. And I'm just curious again, as we think through.

Speaker Change: I don't think we see it as a huge benefit at the same time, where we're not currently expecting it to be a huge detriment either so.

Speaker Change: So fairly balanced as we head into the next fiscal year.

Rob Dickerson: All right, cool. And then just quickly on RetoBix, you know, you called out in the release and comments just the, you know, margin uptick off of some, I guess, pricing. It sounds like maybe, you know, part of that portfolio, the margin uptick was impressive, right, on a sequential but then also on a year-over-year basis. And I'm just curious, again, as we think through, let's say, Q4, you know, next year, is that step up, like, somewhat sustained?

Speaker Change: Alright.

Speaker Change: And then just quickly I'll read the books.

Speaker Change: You called out in the release and comments just a bit of margin uptick offered some I guess pricing it sounds like maybe.

Speaker Change: Part of that portfolio. The margin uptick was was impressive right on a sequential but then also on a year over year basis and I'm. Just curious again as we think through let's say Q4.

Rob Dickerson: I'd take you for you know, even next year is that step up like somewhat.

Speaker Change: Next year is that step up like somewhat sustained like is that kind of more of a kind of a new you know new margin.

Rob Dickerson: But sustained like is that kind of more of a, you know, kind of a new, you know, a new margin kind of base for that business or could there be, you know, some other flow through impacts that would kind of bring that back down. Thanks. Yeah, a couple of things. As Matt said in his prepared remarks, there's a benefit this quarter because of inventory build. So we have an ERP conversion that is going to hit at the beginning of next fiscal year, and in preparation for that, we're building inventory to manage through any the bumps in the road that might occur.

Rob Dickerson: Like, is that kind of more of a, you know, kind of a new, you know, new margin kind of base for that business? Or could there be, you know, some other flow-through impacts that would kind of bring that back down?

Speaker Change: Kind of base for that business or could there be some other flow through impacts that would kind of bring that back to opex.

Unknown Executive: Thanks.

Unknown Executive: Yeah, a couple of things. As Matt said in his prepared remarks, there's a benefit this quarter because of inventory build. So we have an ERP conversion that is going to hit at the beginning of next fiscal year, and in preparation for that, we're building inventory to manage through any... bumps in the road that might occur, and because of that, we had an absorption benefit in the third quarter that you wouldn't expect on an ongoing basis.

Speaker Change: Yeah, a couple of things as Matt said in his prepared remarks, there was a benefit this quarter.

Speaker Change: Because of inventory build so we have an ERP conversion that is going to hit at the beginning of next fiscal year and in preparation for that we're building inventory to manage through any.

Speaker Change: Bumps in the road that might occur and because of that we had under absorption benefit in the third quarter that you wouldn't expect on an ongoing basis.

Rob Dickerson: And because of that, we had an absorption benefit in the third quarter that you wouldn't expect on an ongoing basis. With that said, we certainly expect that Q2 and Q1 of this year were more of the trough. And that our expectation is that we'll begin migrating towards the more historical margin profile of that business. But to be fair, Q3 was a step up that's more of a step than we would expect on the trajectory that we eventually get to. So maybe a clear way to say expect a little bit of a step down, but still the trend line will be better than where it was at the beginning of this fiscal year.

Unknown Executive: With that said, we certainly expect that Q2 and Q1 of this year were more the trough, and our expectation is that we'll begin migrating towards the more historical margin profile of that business. But to be fair, Q3 was a step up that's more of a step than we would expect on the trajectory that we eventually get to. Perhaps a clear way to say it, expect a little bit of a step down, but the trend line will still be better than where it was at the beginning of this fiscal year.

Speaker Change: With that said.

Speaker Change: We certainly expect that.

Speaker Change: Q2, and Q1 of this year were more of the trough and that our expectation is that we will begin migrating towards.

Speaker Change: Towards the more historical margin profile of that business, but it.

Speaker Change: To be fair Q3 was a step up that's more of a step than we would expect on a on the trajectory that we eventually get to so.

Speaker Change: Maybe a clear way to say expect a little bit of a step down but still the trend line will be better than where it was at the beginning of this fiscal year.

Rob Dickerson: Okay, very helpful. Thank you.

Rob Dickerson: Okay, very helpful.

Speaker Change: Okay very helpful. Thank you.

Marc Torrente: Our next question comes from Mark Torrenti with Wells Fargo Securities. Hey, good morning. Thank you for the questions.

Marc Torrente: Our next question comes from Marc Torrente with Wells Fargo Securities.

Marc <unk>: Our next question comes from Marc <unk> with Wells Fargo Securities.

Speaker Change: Got it.

Marc Torrente: Hey, good morning. Thank you for the questions.

Marc <unk>: Hey, good morning. Thank you for the questions first one Pat you talked through some of the drivers in the <unk>.

Marc Torrente: First on pet, you talked through some of the drivers of the sequential slowed down in sales from Q2. Just doing some simple math implies some further expansion on margins, even as you're stepping up advertising around the premium brands. So maybe just a little more color on the margin progress there. Yeah, so I mean, I think a lot of our margin progress has been more around just the flow through the manufacturing efficiency so that we've had and the stabilization there. Is the bigger driver we've taken some of those dollars and reinvested behind the brands and ramped and see that I say manufacturing performance and cost are really the keys for the margin improvement.

Speaker Change: <unk> will slow down in sales from Q2.

Speaker Change: Just doing some simple math implies some further expansion on margins, even as you're stepping up advertising around the premium brands. So maybe just a little more color on the margin progress there.

Marc Torrente: First on PET, you talked through some of the drivers of the sequential slowdown in sales from Q2. Just doing some simple math implies some further expansion in margins, even as you're stepping up advertising around the premium brands. So maybe just a little more color on the margin progress there.

Speaker Change: Yeah. So I mean, I think a lot of our margin progress has been more around just the flow through of the manufacturing efficiencies that we've had in the stabilization there.

Unknown Executive: Yeah, so I mean, I think a lot of our margin progress has been more around just the flow through of the manufacturing efficiencies that we've had and the stabilization there is the bigger driver. We've taken some of those dollars and reinvested behind the brands and ramped up A and C. But I'd say manufacturing performance and cost are really the key to margin improvement.

Speaker Change: The bigger driver we've taken some of those dollars and reinvested behind the brands and it ramped ANC, but.

Marc <unk>: I'd say manufacturing performance and costs are really the keys.

Marc <unk>: For the margin improvement.

Marc Torrente: Okay, thanks. And then catback stopped up this year with a pet investment as well as the shape manufacturing ramp. How much of these projects carry in the next year? You spoke to a facility timing, just any context there and how we should think about catback levels for 25. Okay, I guess thinking through free cash flow conversion ahead. Thanks. Yeah, these are definitely multi-year projects at certainly Norwalk and Bloomfield. And I think the way we've talked about it is. We expect 25 to be very similar to 24 in terms of the cat bugs range we have and spend.

Marc Torrente: Okay, thanks. And then CapEx stepped up this year with the egg and pet investments, as well as the shake manufacturing ramp. How much of these projects carry into next year? You spoke about egg facility timing, just any context there and how we should think about CapEx levels for 2025. I guess, thinking through free cash flow conversion ahead. Thanks. These are definitely multi-year projects.

Speaker Change: Okay. Thanks, and then Capex stepped up this year with a pet investments as well as the shake manufacturing ramp how.

Speaker Change: How much of these projects carry into next year. He spoke to eight facility timing just any context, there and how we should think about capex levels for 25.

Speaker Change: I guess thinking through free cash flow conversion ahead. Thanks, Yeah. Yeah. These are definitely multiyear projects.

Unknown Executive: These are definitely multi-year projects, certainly Norwalk and Bloomfield, and I think the way we've talked about them is... We expect 25 to be very similar to 24 in terms of the CapEx range we have and spend.

Speaker Change: Projects, certainly Norwalk in Bloomfield, and I think that the way we've talked about it is we expect 25 to be very similar to 'twenty four in terms of the Capex range, we have in spend.

Marc Torrente: And Mr. Trent, you did this answer your questions?

Marc Torrente: And Mr. Torrente, did this answer your question? Yeah, thank you. Thank you. And we will take our final question from Carla Casalo of J.P. Morgan.

Speaker Change: And Mr trying to get at this and answer your questions.

Marc Torrente: Yeah, thank you. Thank you.

Speaker Change: Yeah. Thank you.

Carla Cassala: And we will take our final question from Carla Cassala with JP Morgan. Please go ahead. Great.

Speaker Change: Thank you.

Speaker Change: We will take our final question from Carla Casella with Jpmorgan. Please go ahead.

Carla Cassala: Thank you. A couple of follow-ups. You talked about the environment, both in food service and retail. But is your expectation that we should treat trade spending pickup as we go into the back half of this year? And is it consistent across categories? Are you seeing more need for trade spend in one versus another?

Carla Casella: Great. Thank you.

Carla Casalo: Great, thank you. A couple of follow-ups. You talked about the environment, both in food service and retail, but is your expectation that we should see trade spending pick up as we go into the back half of this year? And is it consistent across categories? Are you seeing more need for trade spend in one versus another? And then I have one question on M&A.

Carla Casella: A couple of follow ups, just he talked about the environment.

Speaker Change: Foodservice and retail bank.

Carla Casella: Is your expectation that we should see trade spending pick up this has been going into the back half of this year and is it consistent across categories are you seeing more need for trade spending one versus another and then I have one question on M&A.

Rob Vitale: And then I have one question on the name. I think we will likely see a little bit of an uptick in trade spend, but it will be targeted and not, you know, need your reactive. I think the best example being the way we spent in our Bob Evans brand, you know, we need to make sure we get the lift that is intended with the trade spend. And I'm sorry, what was your other question? Is it more targeted in one category versus another? No, we will, where we think there are pricing opportunities to benefit from trade spend across the portfolio, will execute there.

Carla Casalo: I think we will likely see a little bit of an uptick in trade spend, but it will be targeted and not knee-jerk reactive. I think the best example is the way we spend on our Bob Evans brand. You know, we need to make sure we get the lift that is intended with the trade spend. And I'm sorry, what was your other question?

Speaker Change: I think we will likely see a little bit of an uptick in trade spend but it'll be targeted and not.

Speaker Change: Knee jerk reactive.

Speaker Change: I think the Best example, being our the.

Speaker Change: The way we spent in our Bob Evans brand, we need to make sure we get the lift that is intended with the trade spend.

Speaker Change: And I'm sorry, what was your other question.

Unknown Executive: Well, I'm wondering if it is more targeted to one category versus another, or is one category more exposed?

Speaker Change: Wow.

Speaker Change: Is it more targeted one category versus everyone at Greenway.

Unknown Executive: Now, we'll Where we think there are pricing opportunities to benefit from trade spend across the portfolio, we will execute there. As we go in, the primary focus is on potatoes and side dishes.

Speaker Change: No well where.

Speaker Change: Where we think there are pricing opportunities to benefit from trade spend across the portfolio will execute there.

Rob Vitale: As we go in, the primary focus is on potatoes, side dishes.

Speaker Change: As we go in the primary focus is on potatoes.

Speaker Change: Potatoes side dishes.

Carla Casalo: Okay. And then the other question was about the M&A environment. If you could just talk about the DealFlow and if there are any opportunities for getting more interesting or a level of coming to be more fair, I think in the past, you just talked about your rational type levels for the sellers. Yeah, I'm

Carla Cassala: Okay.

Speaker Change: Okay and then the other question was on the M&A environment. If you could just talk to him.

Carla Cassala: And then the other question was on the M&A environment. If you could just talk to, you know, the deal flow and if any. If opportunities are getting more interesting, our level coming to more fair. I think in the past, you just talked about the rational type levels of the sellers. Yeah, I'm sorry, Carly. You're a fit echoing, so I'm not sure I got all the question, but I'll do my best. I think we've seen a period of time in which there have been lower than average PE exits. So we're seeing more opportunities from PE owners of consumer assets.

Speaker Change: Deal flow and if any if the opportunities are getting more interesting or level coming into more fair I think in the past you've just talked about irrational.

Speaker Change: Levels.

Speaker Change: For the sellers, yes, I'm, sorry, Carla Youre a bit echoing so I'm not sure I got all of the question, but I'll do my best.

Robert Vitale: Yeah, I'm sorry, Carla, you're a bit echoing, so I'm not sure I've got all the questions, but I'll do my best. I think we've seen a period of time in which there have been lower than average P.E. exits, so we're seeing more opportunities from P.E. owners of consumer assets.

Speaker Change: I think we've seen a period of time in which there have been lower than average P. Exits. So we're seeing more opportunities from P owners of consumer assets.

Rob Vitale: We always are of the opinion that corporate owners should do portfolio pruning, so there are some opportunities in that area. So I would say, the same thing I said in my prior comments that the quantum of opportunities has increased significantly year over year and even sequentially. That doesn't mean anything will happen because we want to be very disciplined with respect to how we allocate capital. And as long as we're trading beneath the average of the multiples at which we can acquire on a post-energy basis, we will just stay the course and allocate capital into our shares.

Robert Vitale: We always are of the opinion that corporate owners should do portfolio pruning, so there are some opportunities in that area. So I would say, as I said in my prior comments, that the quantum of opportunities has increased significantly year-over-year and even sequentially. That doesn't mean anything will happen because we want to be very disciplined with respect to how we allocate capital, and as long as we're trading beneath the average of the multiples at which we can acquire on a post-synergy basis, we will just stay the course and allocate capital to our shares. So, good environment, well, a plentiful environment from an opportunity perspective, whether that convergence stays here, not too early to say. Okay, great. Thank you.

Speaker Change: We always are of the opinion that that court.

Speaker Change: Corporate owners should do portfolio pruning. So there are some opportunities in that area.

Speaker Change: So I would say same thing I said in my prior comment that the quantum of opportunities has increased significantly.

Speaker Change: Significantly year over year and even sequentially.

Speaker Change: That doesn't mean anything will happen because we wanted to be very disciplined with respect to how we allocate capital and as long as we're trading.

Speaker Change: Beneath the average of the multiples at which we can acquire on a post synergy basis, we will just stay the course and allocate capital into our shares so a good environment well I plentiful of environment from an opportunity perspective, whether that converts standing here not too early to say.

Rob Vitale: So a good environment, well, a plenty full of environment from an opportunity perspective, whether that converts things here or not, too early to say.

Carla Cassala: Okay, great.

Carla Casalo: Okay, great. Thank you. Thank you.

Speaker Change: Okay, great. Thank you.

Operator: Thank you.

Operator: And we have now reached the conclusion of the question and answer session. This will conclude today's Post Holdings 3rd Quarter 2024 Earnings Conference Call-In Webcast. Please disconnect your line at this time and have a wonderful day.

Operator: ?? ?? ?? ?? ?? ?? ?? ?? ?? ??

Speaker Change: Thank you.

Speaker Change: Okay.

Operator: And we have now reached the conclusion of the question-and-answer session.

Speaker Change: And we have now reached that conclusion of the question and answer session. This will conclude today's post holdings third quarter 2024 earnings conference call and webcast. Please disconnect. Your line at this time and have a wonderful day.

Operator: This will conclude today's post-holdings third quarter of 2024 earnings conference call in webcast.

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Speaker Change: Okay.

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