Q4 2025 J M Smucker Co Earnings Call - Pre-Recorded

June 10, 2025

Crystal Beiting: Thank you for listening to our prepared remarks on our fiscal 2025 fourth quarter earnings. After this brief introduction, Mark Smucker, Chief Executive Officer and Chair of the Board, will provide a business and strategy update. Tucker Marshall, Chief Financial Officer, will then provide a detailed analysis of the financial results and our fiscal 2026 outlook. Later this morning we will hold a separate live question and answer webcast. During today's discussion, we will make forward-looking statements that reflect our current expectations about future plans and performance. These statements rely on assumptions and estimates, and actual results may differ materially due to risks and uncertainties. Additionally, please note we will refer to non-GAAP financial measures management uses to evaluate performance internally. I encourage you to read the full disclosure concerning forward-looking statements and details on our non-GAAP measures in this morning's press release.

Crystal Beiting: Thank you for listening to our prepared remarks on our fiscal 2025 Fourth Quarter earnings. After this brief introduction, Mark Smucker, Chief Executive Officer and Chair of the Board, will provide a business and strategy update. Tucker Marshall, Chief Financial Officer, will then provide a detailed analysis of the financial results and our fiscal 2026 outlook. Later this morning we will hold a separate live question and answer webcast. During today's discussion, we will make forward-looking statements that reflect our current expectations about future plans and performance. These statements rely on assumptions and estimates, and actual results may differ materially due to risks and uncertainties. Additionally, please note we will refer to non-GAAP financial measures management uses to evaluate performance internally. I encourage you to read the full disclosure concerning forward-looking statements and details on our non-GAAP measures in this morning's press release.

2025 fourth quarter earnings. After this brief introduction Mark Smucker, Chief Executive Officer, and chair of the board will provide a business and strategy update.

Unknown Executive: Thank you for listening to our prepared remarks on our fiscal 2025 fourth quarter earnings.

Crystal Beiting: After this brief introduction, Mark Smucker, Chief Executive Officer and Chair of the Board, will provide a business and strategy update.

Speaker Change: Tucker Marshall Chief Financial Officer will then provide a detailed analysis of the financial results and our fiscal 2026 outlook. Later. This morning, we will hold a separate live question and answer webcast.

Tucker Marshall: Tucker Marshall, Chief Financial Officer, will then provide a detailed analysis of the financial results in our Fiscal 2026 Outlook.

Unknown Executive: Later this morning, we will hold a separate live question and answer webcast. During today's discussion, we will make forward-looking statements that reflect our current expectations about future plans and performance. These statements rely on assumptions and estimates, and actual results may differ materially due to risks and uncertainties. Additionally, please note we will refer to non-GAAP financial measures management uses to evaluate performance internally.

During today's discussion we will make forward looking statements that reflect our current expectations about future plans and performance.

These statements rely on assumptions and estimates and actual results may differ materially due to risks and uncertainties. Additionally.

Speaker Change: Additionally, please note we will refer to non-GAAP financial measures management uses to evaluate performance internally I encourage you to read the full disclosure concerning forward looking statements and details on our non-GAAP measures in this morning's press release.

Unknown Executive: I encourage you to read the full disclosure concerning forward-looking statements and details on our non-GAAP measures in this morning's press release.

Speaker Change: Today's press release, a supplementary slide deck management's prepared remarks, and the Q&A webcast can all be accessed on our Investor Relations website at J M Smucker Dot com.

Unknown Executive: Today's press release, a supplementary slide deck, management's prepared remarks, and the Q&A webcast can all be accessed on our investor relations website at jmsmucker.com. We invite all interested parties to join us at 9 o'clock a.m. Eastern Time today for a live question and answer session with management to further discuss our fourth quarter results and next year's outlook for fiscal year 2026.

Crystal Beiting: Today's press release, a supplementary slide deck, Management's prepared remarks, and the Q and A webcast can all be accessed on our investor relations website at jmsmucker.com. We invite all interested parties to join us at 9:00AM Eastern Time today for a live question and answer session with management to further discuss our fourth quarter results and next year's outlook for fiscal year 2026. I will now turn the discussion over to Mark Smucker.

Today's press release, a supplementary slide deck, Management's prepared remarks, and the Q and A webcast can all be accessed on our investor relations website at jmsmucker.com. We invite all interested parties to join us at 9:00AM Eastern Time today for a live question and answer session with management to further discuss our fourth quarter results and next year's outlook for fiscal year 2026. I will now turn the discussion over to Mark Smucker.

Speaker Change: We invite all interested parties to join us at nine o'clock a M. Eastern time today for a live question and answer session with management to further discuss our fourth quarter results and next year's outlook for fiscal year 2026, I will now turn the discussion over to Mark Smucker.

Mark Smucker: I will now turn the discussion over to Mark Smucker. Thank you, Crystal. And good morning, everyone.

Speaker Change: Thank you Crystal and good morning, everyone I will begin today's call with a summary of our full year performance and then provide highlights on our fourth quarter results.

Mark Smucker: Thank you, Crystal, and good morning, everyone. I will begin today's call with a summary of our full-year performance and then provide highlights on our fourth quarter results. I will also share the strategic priorities that will enable us to achieve our Fiscal Year 2026 guidance in what continues to be a dynamic operating environment while positioning the company for future growth through investments to support our key platforms and strengthen our brands. Tucker will then provide additional details on our fourth quarter results and outlook for next fiscal year. Fiscal Year 2025 was a year of significant progress as we delivered positive results in a challenging environment. Our performance reflects top-line growth supported by strong consumer demand for our portfolio of leading brands and bottom-line growth driven by disciplined cost management and execution.

Mark Smucker: I will begin today's call with a summary of our full year performance and then provide highlights on our fourth quarter results.

Speaker Change: I will also share the strategic priorities that will enable us to achieve our fiscal 2026 guidance in what continues to be a dynamic operating environment, while positioning the company for future growth through investments to support our key platforms and strengthen our brands.

Mark Smucker: I will also share the strategic priorities that will enable us to achieve our fiscal 2026 guidance in what continues to be a dynamic operating environment while positioning the company for future growth through investments to support our key platforms and strengthen our brand.

Tucker Marshall: Tucker will then provide additional details on our fourth quarter results and outlook for next fiscal year.

Speaker Change: Fiscal year 2025 was a year of significant progress as we delivered positive results in a challenging environment.

Mark Smucker: Fiscal year 2025 was a year of significant progress as we delivered positive results in a challenging environment. Our performance reflects top line growth supported by strong consumer demand for our portfolio of leading brands and bottom line growth driven by disciplined cost management and execution. We demonstrated agility throughout the organization by successfully managing what we could control, and we navigated with excellence those factors beyond our control. As a result, the business remained resilient amid macroeconomic pressure. Our results in fiscal year 2025 reflect the success of our focus strategy and portfolio optimization, which has fundamentally transformed the company.

Speaker Change: Our performance reflects topline growth supported by strong consumer demand for our portfolio of leading brands and bottom line growth driven by disciplined cost management and execution.

Speaker Change: We demonstrated agility throughout the organization by successfully managing what we could control and we navigated with excellence those factors beyond our control.

Mark Smucker: We demonstrated agility throughout the organization by successfully managing what we could control, and we navigated with excellence those factors beyond our control. As a result, the business remained resilient amid macroeconomic pressures. Our results in fiscal year 2025 reflect the success of our focused strategy in portfolio optimization, which has fundamentally transformed the company. Of note, we reignited innovation that is resonating with our consumers with over $100 million in net sales coming from new products in their first year of launch, resulting in one of our most successful years of innovation in recent history. We launched Jif Peanut Butter and Chocolate Flavored Spread, new varieties of Uncrustables sandwiches, Café Bustelo multi-serve coffee, and Milk-Bone peanut buttery bites, just to name a few, all of which are exceeding expectations.

We demonstrated agility throughout the organization by successfully managing what we could control, and we navigated with excellence those factors beyond our control. As a result, the business remained resilient amid macroeconomic pressures. Our results in fiscal year 2025 reflect the success of our focused strategy in portfolio optimization, which has fundamentally transformed the company. Of note, we reignited innovation that is resonating with our consumers with over $100 million in net sales coming from new products in their first year of launch, resulting in one of our most successful years of innovation in recent history. We launched Jif Peanut Butter and Chocolate Flavored Spread, new varieties of Uncrustables sandwiches, Café Bustelo multi-serve coffee, and Milk-Bone peanut buttery bites, just to name a few, all of which are exceeding expectations.

Speaker Change: As a result, the business remained resilient amid macroeconomic pressures.

Speaker Change: Our results in fiscal year 2025 reflect the success of our focused strategy and portfolio optimization, which has fundamentally transformed the company of note. We reignited innovation that is resonating with our consumers with over 100 million.

Mark Smucker: Of note, we reignited innovation that is resonating with our consumers with over $100 million in net sales coming from new products in their first year of launch, resulting in one of our most successful years of innovation in recent history. We launched Jif peanut butter and chocolate flavored spread, new varieties of uncrustable sandwiches, Cafe Bustelo multi-serve coffee, and Milkbone peanut buttery bites, just to name a few, all of which are exceeding expectations. Our investments in brand building continue to be effective and drove consumer demand, with brands growing or maintaining dollar share, accounting for 74% of our measured retail dollar sales in the fourth quarter as we ended the fiscal year.

Speaker Change: And net sales coming from new products in their first year of launch, resulting in one of our most successful years of innovation in recent history.

Speaker Change: We launched jif, peanut butter and chocolate flavored spread.

Speaker Change: New varieties of unprofitable sandwiches cafe bustillo, multi serve coffee and milk bone peanut buttery bites just to name a few all of which are exceeding expectations.

Speaker Change: Our investments in brand building continue to be effective and drove consumer demand with brands growing or maintaining dollar share accounting for 74% of our measured retail dollar sales in the fourth quarter as we ended the fiscal year.

Mark Smucker: Our investments in brand building continued to be effective and drove consumer demand, with brands growing or maintaining dollar share, accounting for 74% of our measured retail dollar sales in the fourth quarter. As we ended the fiscal year, our Transformation Office delivered cost and productivity benefits, including synergies from the Hostess brand's acquisition of approximately $75 million, which exceeded our original expectations. We continued to prioritize resources to our largest growth opportunities in our key platforms, the Uncrustables, Café Bustelo, Meow Mix, Milk-Bone, and Hostess Brands. I'll dive deeper into each of these, starting with the Uncrustables brand, which continued its strong momentum throughout the year, including realizing its 11th consecutive fiscal year of double digit growth in total company net sales. In fiscal year 2025, we grew the brand by over $125 million to approximately 920 million in net sales.

Our investments in brand building continued to be effective and drove consumer demand, with brands growing or maintaining dollar share, accounting for 74% of our measured retail dollar sales in the fourth quarter. As we ended the fiscal year, our Transformation Office delivered cost and productivity benefits, including synergies from the Hostess brand's acquisition of approximately $75 million, which exceeded our original expectations. We continued to prioritize resources to our largest growth opportunities in our key platforms, the Uncrustables, Café Bustelo, Meow Mix, Milk-Bone, and Hostess Brands. I'll dive deeper into each of these, starting with the Uncrustables brand, which continued its strong momentum throughout the year, including realizing its 11th consecutive fiscal year of double digit growth in total company net sales. In fiscal year 2025, we grew the brand by over $125 million to approximately 920 million in net sales.

Speaker Change: Our transformation office delivered cost and productivity benefits, including synergies from the hostess brands acquisition of approximately $75 million, which exceeded our original expectations.

Mark Smucker: Our transformation office delivered cost and productivity benefits, including synergies from the hostess brand's acquisition of approximately $75 million, which exceeded our original expectations. And we continue to prioritize resources to our largest growth opportunities in our key platforms, the Uncrustables, Cafe Bustelo, Meow Mix, Milkbone, and Hostess Brands.

Speaker Change: And we continued to prioritize resources to our largest growth opportunities in our key platforms. The <unk> Cafe, bustillo meow mix milk bone and hostess brands.

Speaker Change: I'll dive deeper into each of these.

Mark Smucker: I'll dive deeper into each of these. Starting with the Uncrustables brand, which continued its strong momentum throughout the year, including realizing its 11th consecutive fiscal year of double-digit growth in total company net sales. In fiscal year 2025, we grew the brand by over $125 million to approximately $920 million in net sale. This tremendous growth was driven by our national advertising campaign, distribution gains, and new merchandising investments to drive trial and awareness. We also accelerated our innovation efforts with new sandwich varieties and have begun launching a regular cadence of limited edition flavors starting this summer with a new peanut butter and mixed berry spread variety, which is now in stores.

Speaker Change: Starting with the <unk> brand, which continued its strong momentum throughout the year, including realizing its 11th consecutive fiscal year of double digit growth in total company net sales.

Speaker Change: In fiscal year 2025, we grew the brand by over $125 million to approximately $920 million and net sales.

Speaker Change: This tremendous growth was driven by our national advertising campaign distribution gains and new merchandising investments to drive trial and awareness.

Mark Smucker: This tremendous growth was driven by our national advertising campaign, distribution gains, and new merchandising investments to drive trial and awareness. We also accelerated our innovation efforts with new sandwich varieties and have begun launching a regular cadence of limited edition flavors starting this summer with a new peanut butter and mixed berry spread variety which is now in stores. These actions continue to increase household penetration and fuel our ambition to have Uncrustables sandwiches everywhere. The number one SKU in the total frozen category is an Uncrustables sandwich with two SKUs in the top 10. The Uncrustables brand is leading the entire frozen category in new buyers for households with kids, Millennials, and Gen Z. We are expanding into convenience stores and continue to secure commitments to drive growth in this important channel and to support the growth in demand.

This tremendous growth was driven by our national advertising campaign, distribution gains, and new merchandising investments to drive trial and awareness. We also accelerated our innovation efforts with new sandwich varieties and have begun launching a regular cadence of limited edition flavors starting this summer with a new peanut butter and mixed berry spread variety which is now in stores. These actions continue to increase household penetration and fuel our ambition to have Uncrustables sandwiches everywhere. The number one SKU in the total frozen category is an Uncrustables sandwich with two SKUs in the top 10. The Uncrustables brand is leading the entire frozen category in new buyers for households with kids, Millennials, and Gen Z. We are expanding into convenience stores and continue to secure commitments to drive growth in this important channel and to support the growth in demand.

Speaker Change: We also accelerated our innovation efforts with new sandwich varieties and have begun launching a regular cadence of a limited edition flavors, starting this summer with a new peanut butter and mixed Berry spread variety, which is now in stores.

Speaker Change: These actions continue to increase household penetration and fuel our ambition to have on <unk> sandwiches everywhere.

Mark Smucker: These actions continue to increase household penetration and fuel our ambition to have uncrustable sandwiches everywhere. The number one SKU in the total frozen category is an Uncrustable Sandwich with two SKUs in the top ten. The Uncrustables brand is leading the entire frozen category in new buyers for households with kids, millennials, and Gen Z. We are expanding into convenience stores and continue to secure commitments to drive growth in this important channel. And to support the growth in demand, we opened our third and largest Uncrustable Sandwich Manufacturing Facility in McCulloch, Alabama, which continues to increase production, thereby driving margin expansion through more efficient cost absorption.

Speaker Change: The number one SKU in the total frozen category is an unprecedented sandwich with two skus in the top 10.

Speaker Change: The <unk> brand is leading the entire frozen category in new buyers for households, with kids millennials and Gen Z.

Speaker Change: We are expanding into convenience stores and continue to secure commitments to drive growth in this important channel and to support the growth in demand, we opened our third and largest San Cristobal Sandwich manufacturing facility in Mccullough, Alabama, which continues to increase production there.

Mark Smucker: We opened our third and largest Uncrustables sandwich manufacturing facility in McCalla, Alabama, which continues to increase production, thereby driving margin expansion through more efficient cost absorption. With this incredible momentum, we are well on our way for the Uncrustables brand to generate over $1 billion in net sales by the end of fiscal year 2026. Our second key growth platform, the Café Bustelo brand, continued its momentum as one of the fastest growing brands in the at-home coffee category. The brand gained dollar and volume share in every segment it competes in, including the mainstream, one-cup, and instant categories. Over the past year, the Café Bustelo brand grew net sales by 19% in our US retail coffee portfolio, ending fiscal 2025 with net sales of approximately $400 million.

We opened our third and largest Uncrustables sandwich manufacturing facility in McCalla, Alabama, which continues to increase production, thereby driving margin expansion through more efficient cost absorption. With this incredible momentum, we are well on our way for the Uncrustables brand to generate over $1 billion in net sales by the end of fiscal year 2026. Our second key growth platform, the Café Bustelo brand, continued its momentum as one of the fastest growing brands in the at-home coffee category. The brand gained dollar and volume share in every segment it competes in, including the mainstream, one-cup, and instant categories. Over the past year, the Café Bustelo brand grew net sales by 19% in our US retail coffee portfolio, ending fiscal 2025 with net sales of approximately $400 million.

Speaker Change: Thereby driving margin expansion through more efficient cost absorption.

Speaker Change: With this incredible momentum we are well on our way for the Incredibles brand to generate over $1 billion in net sales by the end of fiscal year 2026.

Mark Smucker: With this incredible momentum, we are well on our way for the Incrustables brand to generate over $1 billion in net sales by the end of fiscal year 2026.

Speaker Change: Our second key growth platform. The Cafe Bustillo brand continued its momentum as one of the fastest growing brands in the at home coffee category.

Mark Smucker: Our second key growth platform, the Cafe Bustelo brand continued its momentum as one of the fastest growing brands in the at home coffee category. The brand gained dollar and volume share in every segment it competes in, including the mainstream, one cup and instant categories over the past year. The Cafe Bustelo brand grew net sales by 19% in our U.S. retail coffee portfolio, ending fiscal 2025 with net sales of approximately $400 million. We remain focused on expanding the Cafe Bustelo brand nationally and broadening its consumer audience through marketing and innovation and have launched new roast profiles in both prepack and one cup formats.

Speaker Change: The brand gained dollar and volume share in every segment and competes in including the mainstream one cup and instant categories over the past year.

Speaker Change: The cafe boost Hello brand grew net sales by 19% in our U S retail coffee portfolio ending fiscal 2025 with net sales of approximately $400 million.

Speaker Change: We remain focused on expanding the cafe bustillo brand nationally and broadening its consumer audience through marketing and innovation and have launched new Roche profiles in both pre pack and one cup formats.

Mark Smucker: We remain focused on expanding the Café Bustelo brand nationally and broadening its consumer audience through marketing and innovation, and have launched new roast profiles in both pre-pack and one-cup formats. These new products have received strong retailer acceptance that exceeded our initial expectations and will help drive another year of anticipated double-digit net sales growth for the brand. For the Milk-Bone and Meow Mix brands, we continue to drive the humanization trend in the pet category and have created opportunities for our brands to deliver meaningful innovation through our leading volume share positions in dog snacks and dry cat food. In dog snacks, we launched the first dog treat featuring a human food brand, Milk-Bone Peanut Buttery Bites made with Jif Peanut Butter, which outpaced all competitor innovations launched in 2024.

We remain focused on expanding the Café Bustelo brand nationally and broadening its consumer audience through marketing and innovation, and have launched new roast profiles in both pre-pack and one-cup formats. These new products have received strong retailer acceptance that exceeded our initial expectations and will help drive another year of anticipated double-digit net sales growth for the brand. For the Milk-Bone and Meow Mix brands, we continue to drive the humanization trend in the pet category and have created opportunities for our brands to deliver meaningful innovation through our leading volume share positions in dog snacks and dry cat food. In dog snacks, we launched the first dog treat featuring a human food brand, Milk-Bone Peanut Buttery Bites made with Jif Peanut Butter, which outpaced all competitor innovations launched in 2024.

Speaker Change: These new products have received strong retailer acceptance that exceeded our initial expectations and will help drive another year of anticipated double digit net sales growth for the brand.

Mark Smucker: These new products have received strong retailer acceptance that exceeded our initial expectations and will help drive another year of anticipated double-digit net sales growth for the brand.

Speaker Change: For the milk bone and Meow mix brands, we continue to drive the Humanization trend in the pet category and have created opportunities for our brands to deliver meaningful innovation through our leading volume share positions in dog snacks and dry cat food.

Mark Smucker: For the MilkBone and MeowMix brands, we continue to drive the humanization trend in the pet category and have created opportunities for our brands to deliver meaningful innovation through our leading volume share positions in dog snacks and dry cat food. In dog snacks, we launched the first dog treat featuring a human food brand, Milkbone peanut buttery bites made with Jif peanut butter, which outpaced all competitor innovations launched in 2024. The launch continues to exceed our expectations and contributed to the strong double digit net sales growth for our milk bone soft and chewy dog snacks this past fiscal year.

Speaker Change: In dog snacks, we launched the first dog treat featuring a human food brand milk bone peanut butter rebates made with jif peanut butter, which outpaced all competitor innovations launched in 2024.

Speaker Change: The launch continues to exceed our expectations and contributed to the strong double digit net sales growth for our milk bone soft and chewy dog snacks this past fiscal.

Mark Smucker: The launch continues to exceed our expectations and contributed to the strong double-digit net sales growth for our Milk-Bone Soft and Chewy dog snacks this past fiscal year. Turning to the Meow Mix brand, we continued to fuel growth through modernized packaging, elevated mainstream options, and margin accretive innovation, all of which drove share growth and household penetration in the dry cat food category this past year. Our most recent innovation, Meow Mix Gravy Bursts, is off to a strong start and highlights our ability to bring unique innovation to the category, and for the overall segment, we were able to expand our US retail pet foods margins by over 500 basis points, demonstrating the results of our portfolio optimization strategy and the benefits of our Transformation Office.

The launch continues to exceed our expectations and contributed to the strong double-digit net sales growth for our Milk-Bone Soft and Chewy dog snacks this past fiscal year. Turning to the Meow Mix brand, we continued to fuel growth through modernized packaging, elevated mainstream options, and margin accretive innovation, all of which drove share growth and household penetration in the dry cat food category this past year. Our most recent innovation, Meow Mix Gravy Bursts, is off to a strong start and highlights our ability to bring unique innovation to the category, and for the overall segment, we were able to expand our US retail pet foods margins by over 500 basis points, demonstrating the results of our portfolio optimization strategy and the benefits of our Transformation Office.

Speaker Change: Turning to the Meow mix brand, we continued to fuel growth through modernized packaging elevated mainstream options and margin accretive innovation.

Mark Smucker: Turning to the Meow Mix brand, we continue to fuel growth through modernized packaging, elevated mainstream options, and margin accretive innovation. all of which drove share growth and household penetration in the dry cat food category this past year. Our most recent innovation, Meow Mix Gravy Burst, is off to a strong start and highlights our ability to bring unique innovation to the category. And for the overall segment, we were able to expand our U.S. retail pet foods margins by over 500 basis points, demonstrating the results of our Portfolio Optimization Strategy and the benefits of our Transformation Office.

Speaker Change: All of which drove share growth in household penetration in the dry cat food category this past year.

Speaker Change: Our most recent innovation meow mix gravy birth is off to a strong start and highlights our ability to bring unique innovation to the category.

Speaker Change: And for the overall segment, we were able to expand our U S retail pet foods margins by over 500 basis points, demonstrating the result of our portfolio optimization strategy.

Speaker Change: And the benefits of our transformation office.

Speaker Change: Finally, we are taking decisive actions to improve the results of our sweet baked snack segment, which has not met our expectations. The business was impacted by two primary factors, which ultimately led to underperformance in the segment first consumers continue to be.

Mark Smucker: Finally, we are taking decisive actions to improve the results of our sweet baked snack segment, which has not met our expectations. The business was impacted by two primary factors which ultimately led to underperformance in the segment. First, consumers continue to be selective in expending, largely driven by inflationary pressures and diminished discretionary income, causing the sweet baked goods category to recover slower than we anticipated. These trends are causing a reduction in all channels, inclusive of convenience, where traffic and spend has been broadly challenged. Second, we did not perform with excellence from a distribution, merchandising, and competitive standpoint.

Mark Smucker: Finally, we are taking decisive actions to improve the results of our Sweet Baked Snacks segment, which has not met our expectations. The business was impacted by two primary factors, which ultimately led to underperformance in the segment. First, consumers continue to be selective in spending, largely driven by inflationary pressures and diminished discretionary income, causing the Sweet baked goods category to recover slower than we anticipated. These trends are causing a reduction in all channels, inclusive of convenience, where traffic and spend has been broadly challenged. Second, we did not perform with excellence from a distribution, merchandising, and competitive standpoint. We are addressing these challenges and are committed to returning the Hostess brand to growth. With that said, the environment and our assumptions have evolved since we acquired the Hostess business.

Finally, we are taking decisive actions to improve the results of our Sweet Baked Snacks segment, which has not met our expectations. The business was impacted by two primary factors, which ultimately led to underperformance in the segment. First, consumers continue to be selective in spending, largely driven by inflationary pressures and diminished discretionary income, causing the Sweet baked goods category to recover slower than we anticipated. These trends are causing a reduction in all channels, inclusive of convenience, where traffic and spend has been broadly challenged. Second, we did not perform with excellence from a distribution, merchandising, and competitive standpoint. We are addressing these challenges and are committed to returning the Hostess brand to growth. With that said, the environment and our assumptions have evolved since we acquired the Hostess business.

Speaker Change: Selected.

Speaker Change: Okay.

Speaker Change: Largely driven by inflationary pressures and diminished discretionary income, causing the sweet baked goods category to recover slower than we anticipated. These.

Speaker Change: These trends are causing a reduction in all channels inclusive of convenience where traffic and spend has been broadly challenged.

Speaker Change: Second we did not perform with excellence from a distribution merchandising and competitive standpoint.

Speaker Change: We are addressing these challenges and are committed to returning the hostess brand to growth.

Mark Smucker: We are addressing these challenges and are committed to returning the Hostess brand to growth. With that said, the environment and our assumptions have evolved since we acquired the Hostess Business. Taking into consideration these changes, and with a new leader of our Sweet Baked Snacks segment in place, providing a current perspective of the business, we are updating our expectations and now anticipate 3% long-term net sales growth for the segment. We are also refining our strategy and taking a more focused approach for this business.

Speaker Change: With that said the environment and our assumptions have evolved since we acquired the hostess business.

Speaker Change: Taking into consideration these changes and with a new leader of our sweet baked snack segment in place providing a current perspective of the business. We are updating our expectations and now anticipate 3% long term net sales growth for this segment.

Mark Smucker: Taking into consideration these changes and with a new leader of our Sweet Baked Snacks segment in place providing a current perspective of the business, we are updating our expectations and now anticipate the 3% long term net sales growth for the segment. We are also refining our strategy and taking a more focused approach for this business by narrowing our priorities to three key drivers. We will accelerate the stabilization and eventual growth of the Hostess brand through strengthening the portfolio, elevating our execution, and reigniting sustainable growth for the Sweet Baked Snacks segment. First, we are strengthening our portfolio to stabilize the Hostess brand's performance and deliver margin expansion. This includes optimizing our assortment, executing portfolio simplification tied to fixed cost reductions, and improving competitiveness through key price points. Actions we are taking include improving core velocities through brand building, media investment, and breakthrough activations.

Taking into consideration these changes and with a new leader of our Sweet Baked Snacks segment in place providing a current perspective of the business, we are updating our expectations and now anticipate the 3% long term net sales growth for the segment. We are also refining our strategy and taking a more focused approach for this business by narrowing our priorities to three key drivers. We will accelerate the stabilization and eventual growth of the Hostess brand through strengthening the portfolio, elevating our execution, and reigniting sustainable growth for the Sweet Baked Snacks segment. First, we are strengthening our portfolio to stabilize the Hostess brand's performance and deliver margin expansion. This includes optimizing our assortment, executing portfolio simplification tied to fixed cost reductions, and improving competitiveness through key price points. Actions we are taking include improving core velocities through brand building, media investment, and breakthrough activations.

Speaker Change: We're also refining our strategy and taking a more focused approach for this business.

Speaker Change: By narrowing our priorities to three key drivers, we will accelerate the stabilization and eventual growth of the hostess brand through strengthening the portfolio elevating our execution and reigniting sustainable growth for the sweet baked snack segment.

Mark Smucker: By narrowing our priorities to three key drivers, we will accelerate the stabilization and eventual growth of the Hostess brand through strengthening the portfolio, elevating our execution, and reigniting sustainable growth for the Sweet Baked Snacks segment. First, we are strengthening our portfolio to stabilize the hostess brand's performance and deliver margin expansion. This includes optimizing our assortment, executing portfolio simplification tied to fixed cost reductions, and improving competitiveness through key price points. actions we are taking include improving core velocities through brand building, media investment and breakthrough activation. We are currently launching a portfolio redesign across all consumer touch points and optimizing our assortment of product offerings through SKU and display rationalization.

Speaker Change: First we are strengthening our portfolio to stabilize the hostess brands' performance and deliver margin expansion. This includes optimizing our assortment executing portfolio simplification tied to fixed cost reductions and improving competitiveness through key price points.

Speaker Change: <unk>.

Speaker Change: Actions. We are taking include improving core velocities through brand building media investment and breakthrough Activations. We are currently launching a portfolio redesign across all consumer touch points and optimizing our assortment of product offerings through <unk>.

Mark Smucker: We are currently launching a portfolio redesign across all consumer touchpoints and optimizing our assortment of product offerings through SKU and display rationalization. In addition to improving core velocities, we are taking steps to rebuild the margin profile of the Sweet Baked Snacks segment through a streamlined bakery footprint and performance enhancement. This includes the recent announcement of the planned closure of our Indianapolis manufacturing facility and through embracing a transformation mindset regarding cost and productivity savings. Further, we are evolving our promotion and trade optimization strategy to meet the needs of today's consumer. Our second strategic driver for the Sweet Baked Snacks segment is to elevate our execution by improving our supply chain efficiency, streamlining commercial processes, and redeploying resources.

We are currently launching a portfolio redesign across all consumer touchpoints and optimizing our assortment of product offerings through SKU and display rationalization. In addition to improving core velocities, we are taking steps to rebuild the margin profile of the Sweet Baked Snacks segment through a streamlined bakery footprint and performance enhancement. This includes the recent announcement of the planned closure of our Indianapolis manufacturing facility and through embracing a transformation mindset regarding cost and productivity savings. Further, we are evolving our promotion and trade optimization strategy to meet the needs of today's consumer. Our second strategic driver for the Sweet Baked Snacks segment is to elevate our execution by improving our supply chain efficiency, streamlining commercial processes, and redeploying resources.

Speaker Change: And display rationalization.

Speaker Change: In addition to improving core velocities, we are taking steps to rebuild the margin profile of the sweet baked snack segment through a streamlined bakery footprint and performance enhancement. This includes the recent announcement of the planned closure of our Indianapolis.

Mark Smucker: In addition to improving core velocities, we are taking steps to rebuild the margin profile of the sweet baked snack segment through a streamlined bakery footprint and performance enhancement. This includes the recent announcement of the planned closure of our Indianapolis manufacturing facility and through embracing a transformation mindset regarding cost and productivity savings. Further, we are evolving our promotion and trade optimization strategy to meet the needs of today's consumers. Our second strategic driver for the Sweet Baked Snacks segment is to elevate our execution by improving our supply chain efficiency, streamlining commercial processes, and redeploying resources. To start, we are creating a dedicated sweet baked snack sales organization to enable greater focus and are reorganizing marketing resources to improve accountability and prioritization within the segment.

Speaker Change: <unk> facility and through embracing a transformation mindset regarding cost and productivity savings.

Speaker Change: Further we are evolving our promotion and trade optimization strategy to meet the needs of today's consumer.

Speaker Change: Our second strategic driver for the Sweet baked snack segment is to elevate our execution by improving our supply chain efficiency streamlining commercial processes and redeploying resources to start we are creating a dedicated sweet baked snack sales organization to enable.

Mark Smucker: To start, we are creating a dedicated sweet baked snack sales organization to enable greater focus and are reorganizing marketing resources to improve accountability and prioritization within the segment. Our third driver is to refocus our strategy to reignite sustainable growth. Hostess remains an iconic brand with strong awareness, category-leading household penetration, and beloved products with the number one brand of packaged donuts in the category in Donuts, the number one cupcake in the category, and a leading snack cakes brand in Twinkies. We are focusing on the unique areas of strength for the brand by evolving our demand creation strategy to meet the expectations of today's sweet snacking consumer and shifting our innovation strategy to ensure we are strengthening the iconic parts of the portfolio.

To start, we are creating a dedicated sweet baked snack sales organization to enable greater focus and are reorganizing marketing resources to improve accountability and prioritization within the segment. Our third driver is to refocus our strategy to reignite sustainable growth. Hostess remains an iconic brand with strong awareness, category-leading household penetration, and beloved products with the number one brand of packaged donuts in the category in Donuts, the number one cupcake in the category, and a leading snack cakes brand in Twinkies. We are focusing on the unique areas of strength for the brand by evolving our demand creation strategy to meet the expectations of today's sweet snacking consumer and shifting our innovation strategy to ensure we are strengthening the iconic parts of the portfolio.

Speaker Change: Greater focus and are reorganizing marketing resources to improve accountability and prioritization within the segment.

Speaker Change: Our third driver is to refocus our strategy to reignite sustainable growth.

Mark Smucker: Our third driver is to refocus our strategy to reignite sustainable growth. Hostess remains an iconic brand with strong awareness, category leading household penetration and beloved products with the number one brand of packaged donuts in the category in Donuts, the number one cupcake in the category, and a leading snack cakes brand in Twinkies. We are focusing on the unique areas of strength for the brand by evolving our demand creation strategy to meet the expectations of today's sweet snacking consumer and shifting our innovation strategy to ensure we are strengthening the iconic parts of the portfolio. We will continue to apply our proven brand-building model to the Hostess brand, and through these actions we are confident we can build back momentum and profitability for the Sweet Baked Snack segment, while positioning it for sustainable long-term growth.

Speaker Change: Hostess remains an iconic brand with strong awareness category, leading household penetration and be loved products with the number one brand of package donuts in the category in Donuts. The number one cupcake in the category and a leading snack cakes brands in twinkies.

Speaker Change: We are focusing on the unique areas of strength for the brand by evolving our demand creation strategy to meet the expectations of todays sweet snacking consumer and shifting our innovation strategy to ensure we are strengthening the iconic parts of the portfolio.

Speaker Change: We will continue to apply our proven brand building model to the hostess brand and through these actions. We are confident we can build back momentum and profitability for the sweet baked snack segment, while positioning it for a sustainable long term growth.

Mark Smucker: We will continue to apply our proven brand building model to the Hostess brand, and through these actions we are confident we can build back momentum and profitability for the Sweet Baked Snacks segment while positioning it for sustainable long-term growth. Altogether, our key platforms, including the Hostess brand, represent our largest growth opportunities. We anticipate these brands will deliver over 80% of the company's growth over the next five years. Now turning to our fourth quarter results, total company comparable net sales decreased 1%, and when excluding contract manufacturing sales related to the divested pet food brands, comparable net sales were flat versus the prior year. In coffee, net sales increased 11%. Our portfolio is performing well as we navigate record high green coffee costs and continue to demonstrate the ability to recover increased commodity costs through responsible pricing.

We will continue to apply our proven brand building model to the Hostess brand, and through these actions we are confident we can build back momentum and profitability for the Sweet Baked Snacks segment while positioning it for sustainable long-term growth. Altogether, our key platforms, including the Hostess brand, represent our largest growth opportunities. We anticipate these brands will deliver over 80% of the company's growth over the next five years. Now turning to our fourth quarter results, total company comparable net sales decreased 1%, and when excluding contract manufacturing sales related to the divested pet food brands, comparable net sales were flat versus the prior year. In coffee, net sales increased 11%. Our portfolio is performing well as we navigate record high green coffee costs and continue to demonstrate the ability to recover increased commodity costs through responsible pricing.

Speaker Change: Altogether, our key platforms, including the hostess brand represent our largest growth opportunities. We anticipate these brands will deliver over 80% of the company's growth over the next five years.

Mark Smucker: All together, our key platforms, including the hostess brand, represent our largest growth opportunities. We anticipate these brands will deliver over 80% of the company's growth over the next five years.

Speaker Change: Now turning to our fourth quarter results.

Mark Smucker: Now turning to our fourth quarter results. Total company comparable net sales decreased 1%, and when excluding contract manufacturing sales related to the divested pet food brands, comparable net sales were flat versus the prior year. In coffee, net sales increased 11% Our portfolio is performing well as we navigate record high green coffee costs and continue to demonstrate the ability to recover increased commodity costs through responsible pricing. Due to higher green coffee costs and the pass-through nature of the coffee category, we took a price increase last June across parts of our portfolio. In October, we successfully took a second price increase across our entire portfolio as we saw continued inflation in green coffee.

Speaker Change: Total company comparable net sales decreased 1% and when excluding contract manufacturing sales related to the divested pet food brands comparable net sales were flat versus the prior year.

Speaker Change: In coffee net sales increased 11%.

Speaker Change: Our portfolio is performing well as we navigate record high green coffee costs and continued to demonstrate the ability to recover increased commodity costs through responsible pricing.

Speaker Change: Due to higher green coffee costs and the pass through nature of the coffee category. We took a price increase last June across parts of our portfolio.

Mark Smucker: Due to higher green coffee costs and the pass-through nature of the coffee category, we took a price increase last June across parts of our portfolio. In October, we successfully took a second price increase across our entire portfolio as we saw continued inflation in green coffee. Since then, price elasticity of demand trends have been favorable to our initial expectations, including in Q4. As we start fiscal year 2026, there is a need to take further pricing actions to recover increasing costs from ongoing green coffee inflation. As such, we took a price increase in May which is now on shelf, and are planning another price increase for August. Through the combination of these two pricing actions, we will recover our anticipated costs for the fiscal year and have contemplated a historical price elasticity of demand impact to volume in our guidance.

Due to higher green coffee costs and the pass-through nature of the coffee category, we took a price increase last June across parts of our portfolio. In October, we successfully took a second price increase across our entire portfolio as we saw continued inflation in green coffee. Since then, price elasticity of demand trends have been favorable to our initial expectations, including in Q4. As we start fiscal year 2026, there is a need to take further pricing actions to recover increasing costs from ongoing green coffee inflation. As such, we took a price increase in May which is now on shelf, and are planning another price increase for August. Through the combination of these two pricing actions, we will recover our anticipated costs for the fiscal year and have contemplated a historical price elasticity of demand impact to volume in our guidance.

Speaker Change: In October we successfully took a second price increase across our entire portfolio as we saw continued inflation in green coffee.

Speaker Change: Since then price elasticity of demand trends have been favorable to our initial expectations, including in the fourth quarter.

Mark Smucker: Since then, price elasticity of demand trends have been favorable to our initial expectations, including in the fourth quarter. As we start fiscal year 26, there is a need to take further pricing actions to recover increasing costs from ongoing green coffee inflation. As such, we took a price increase in May, which is now on shelf, and are planning another price increase for August. Through the combination of these two pricing actions, we will recover our anticipated costs for the fiscal year and have contemplated a historical price elasticity of demand impact to volume in our guidance. Overall, at home coffee remains a strong and resilient category that provides value to consumers in all economic environments.

Speaker Change: As we start fiscal year 'twenty six there is a need to take further pricing actions to recover increasing costs from ongoing green coffee inflation.

Speaker Change: As such we took a price increase in May which is now on shelf and are planning another price increase for August.

Speaker Change: Through the combination of these two pricing actions, we will recover our anticipated costs for the fiscal year and have contemplated a historical price elasticity of demand impact to volume in our guidance.

Speaker Change: Overall at home coffee remains a strong and resilient category that provides value to consumers in all economic environments.

Mark Smucker: Overall, at-home coffee remains a strong and resilient category that provides value to consumers in all economic environments, and at-home coffee continues to represent approximately 70% of all coffee drinking occasions. Our portfolio provides an affordable price per serving as an alternative to other beverage experiences such as the coffee shop, among others. We continue to anticipate the commodity will normalize over time as it has historically. As always, we will manage our coffee business through a strategy that demonstrates a balance between recovering inflationary input costs while providing consumers with attractive options ranging from value to premium. In frozen handheld and spreads, net sales was flat versus the prior year, primarily driven by growth for Uncrustables sandwiches, partially offset by decreases for Smucker's Fruit Spreads and Jif peanut butter.

Overall, at-home coffee remains a strong and resilient category that provides value to consumers in all economic environments, and at-home coffee continues to represent approximately 70% of all coffee drinking occasions. Our portfolio provides an affordable price per serving as an alternative to other beverage experiences such as the coffee shop, among others. We continue to anticipate the commodity will normalize over time as it has historically. As always, we will manage our coffee business through a strategy that demonstrates a balance between recovering inflationary input costs while providing consumers with attractive options ranging from value to premium. In frozen handheld and spreads, net sales was flat versus the prior year, primarily driven by growth for Uncrustables sandwiches, partially offset by decreases for Smucker's Fruit Spreads and Jif peanut butter.

Speaker Change: And at home coffee continues to represent approximately 70% of all coffee drinking occasions.

Mark Smucker: and at home coffee continues to represent approximately 70% of all coffee drinking occasions. Our portfolio provides an affordable price per serving as an alternative to other beverage experiences such as the coffee shop, among others. We continue to anticipate that the commodity will normalize over time, as it has historically. As always, we will manage our coffee business through a strategy that demonstrates a balance between recovering inflationary input costs while providing consumers with attractive options ranging from value to premium. In frozen handheld and spreads, net sales was flat versus the prior year, primarily driven by growth for uncrustable sandwiches, partially offset by decreases for Smucker's fruit spreads and Jif peanut butter.

Speaker Change: Our portfolio provides an affordable price per serving as an alternative to other beverage experiences such as the coffee shop among others.

Speaker Change: We continue to anticipate the commodity will normalize over time as it has historically.

Speaker Change: As always we will manage our coffee business through a strategy that demonstrates a balance between recovering inflationary input costs, while providing consumers with attractive options ranging from value to premium.

Speaker Change: And frozen handheld and spreads net sales was flat versus the prior year, primarily driven by growth for unprofitable sandwiches, partially offset by decreases for smokers fruit spreads and jif peanut butter.

Speaker Change: Measured retail dollar sales outpace net sales in the quarter foreign Cressa bowls sandwiches, as we lapped strong distribution gains in the prior year.

Mark Smucker: Measured retail dollar sales outpaced net sales in the quarter for Incrucible Sandwiches as we lapped strong distribution gains in the prior year. Last week, we took a list price increase on Uncrustable Sandwiches to recover increased costs. This is our first price increase for the brand in over three years. In pet foods, net sales decreased 13% versus the prior year, reflecting unexpected retailer inventory headwinds and a reduction in contract manufacturing sales related to the divested pet food brands. measured retail dollar sales for our dog snacks portfolio in the latest 13 week period declined seven percent and meow mix cat food dollar sales increased three percent Overall, the dog snacks category continues to be impacted by a slowdown in discretionary spending, largely driven by inflationary pressure.

Mark Smucker: Measured retail dollar sales outpaced net sales in the quarter for Uncrustables sandwiches as we lapped strong distribution gains in the prior year. Last week we took a list price increase on Uncrustables sandwiches to recover increased costs. This is our first price increase for the brand in over three years. In pet foods, net sales decreased 13% versus the prior year, reflecting unexpected retailer inventory headwinds and a reduction in contract manufacturing sales related to the divested pet food brands. Measured retail dollar sales for our dog snacks portfolio in the latest 13-week period declined 7% and Meow Mix cat food dollar sales increased 3%. Overall, the dog snacks category continues to be impacted by a slowdown in discretionary spending, largely driven by inflationary pressures.

Measured retail dollar sales outpaced net sales in the quarter for Uncrustables sandwiches as we lapped strong distribution gains in the prior year. Last week we took a list price increase on Uncrustables sandwiches to recover increased costs. This is our first price increase for the brand in over three years. In pet foods, net sales decreased 13% versus the prior year, reflecting unexpected retailer inventory headwinds and a reduction in contract manufacturing sales related to the divested pet food brands. Measured retail dollar sales for our dog snacks portfolio in the latest 13-week period declined 7% and Meow Mix cat food dollar sales increased 3%. Overall, the dog snacks category continues to be impacted by a slowdown in discretionary spending, largely driven by inflationary pressures.

Speaker Change: Last week, we took a list price increase on <unk> sandwiches to recover increased costs.

Speaker Change: This is our first price increase for the brand in over three years.

Speaker Change: And pet foods net sales decreased 13% versus the prior year, reflecting unexpected retailer inventory headwinds and a reduction in contract manufacturing sales related to the divested pet food brands.

Speaker Change: Measured retail dollar sales for our dog snacks portfolio in the latest 13 week period declined 7% and Meow mix Cat food dollar sales increased 3%.

Speaker Change: Overall, the dog snacks category continues to be impacted by a slowdown in discretionary spending largely driven by inflationary pressures.

Speaker Change: Our portfolio remains well positioned as we continue to focus on driving growth for the milk bone brand with its strong leadership position in the category.

Mark Smucker: Our portfolio remains well positioned as we continue to focus on driving growth for the Milk-Bone brand with its strong leadership position in the category. In cat food, we continue to see tailwinds as the cat population is projected to grow, and we anticipate further share growth for the Meow Mix brand. Dog snacks and cat food are attractive categories, and e-commerce trends will remain a tailwind for our portfolio. In sweet baked snacks, comparable net sales decreased 14%. The decrease in net sales was greater than anticipated, primarily driven by elevated trade recognition in the quarter. Dollar sales for the Hostess brand in the latest 13-week period declined 7%, and we saw a stabilization in our overall share trends.

Our portfolio remains well positioned as we continue to focus on driving growth for the Milk-Bone brand with its strong leadership position in the category. In cat food, we continue to see tailwinds as the cat population is projected to grow, and we anticipate further share growth for the Meow Mix brand. Dog snacks and cat food are attractive categories, and e-commerce trends will remain a tailwind for our portfolio. In sweet baked snacks, comparable net sales decreased 14%. The decrease in net sales was greater than anticipated, primarily driven by elevated trade recognition in the quarter. Dollar sales for the Hostess brand in the latest 13-week period declined 7%, and we saw a stabilization in our overall share trends.

Mark Smucker: Our portfolio remains well positioned as we continue to focus on driving growth for the Milkbone brand with its strong leadership position in the category. In cat food, we continue to see tailwinds as the cat population is projected to grow, and we anticipate further share growth for the Meow Mix brand. Dog snacks and cat food are attractive categories, and e-commerce trends will remain a tailwind for our portfolio. In Sweetbake Snacks, comparable net sales decreased 14%. The decrease in net sales was greater than anticipated, primarily driven by elevated trade recognition in the quarter. Dollar sales for the hostess brand in the latest 13 week period declined 7% and we saw a stabilization in our overall share trend.

Speaker Change: In cat food, we continue to see tailwind as the cat population is projected to grow and we anticipate further share growth for the meow mix brand.

Speaker Change: Dog snacks, and cat food are attractive categories and e-commerce trends will remain a tailwind for our portfolio.

Speaker Change: In sweet baked snacks comparable net sales decreased 14%.

Speaker Change: The decrease in net sales was greater than anticipated, primarily driven by elevated trade recognition in the quarter.

Speaker Change: Dollar sales for the hostess brand in the latest 13 week period declined 7% and we saw a stabilization in our overall share trends.

Speaker Change: Finally in international and away from home comparable net sales grew 4%.

Mark Smucker: Finally, in international and away from home, comparable net sales grew 4%. Growth was driven by the away from home business as it continues to deliver strong results by leveraging our leading national brands and key growth platforms in away from home channels. As we exit the fiscal year, I would like to highlight a few key points. Our legacy business, which accounts for approximately 85% of our total company net sales, delivered strong growth. While near-term performance has not met our expectations for the sweet baked snack segment, we are taking decisive actions to stabilize and refocus the segment, and we remain confident in our ability to deliver long-term sustainable growth and our ambition to generate over $1 billion in free cash flow annually. With this in mind, we are amplifying what is working and evolving our strategy where needed.

Finally, in international and away from home, comparable net sales grew 4%. Growth was driven by the away from home business as it continues to deliver strong results by leveraging our leading national brands and key growth platforms in away from home channels. As we exit the fiscal year, I would like to highlight a few key points. Our legacy business, which accounts for approximately 85% of our total company net sales, delivered strong growth. While near-term performance has not met our expectations for the sweet baked snack segment, we are taking decisive actions to stabilize and refocus the segment, and we remain confident in our ability to deliver long-term sustainable growth and our ambition to generate over $1 billion in free cash flow annually. With this in mind, we are amplifying what is working and evolving our strategy where needed.

Speaker Change: Growth was driven by the away from home business as it continues to deliver strong results by leveraging our leading national brands and key growth platforms in away from home channels.

Speaker Change: As we exit the fiscal year I would like to highlight a few key points.

Mark Smucker: As we exit the fiscal year, I would like to highlight a few key points. Our legacy business, which accounts for approximately 85% of our total company net sales delivered strong growth. While near-term performance has not met our expectations for the Sweet Baked Snacks segment, we are taking decisive actions to stabilize and refocus the segment. And we remain confident in our ability to deliver long term sustainable growth and our ambition to generate over $1 billion in free cash flow annually. With this in mind, we are amplifying what is working and evolving our strategy where needed.

Speaker Change: Our legacy business, which accounts for approximately 85% of our total company net sales delivered strong growth.

Speaker Change: While near term performance has not met our expectations for the sweet baked snack segment, we are taking decisive actions to stabilize and refocus the segment.

Speaker Change: And we remain confident in our ability to deliver long term sustainable growth and our ambition to generate over $1 billion in free cash flow annually with this in mind, we are amplifying what is working and evolving our strategy where.

Speaker Change: Need it.

Speaker Change: Our strategic priorities for fiscal year 2026 are as follows.

Mark Smucker: Our strategic priorities for Fiscal Year 2026 are as follows. First, accelerate organic growth by investing in our key platforms while also enabling the delivery of brands that meaningfully support total company profitability. This includes working to stabilize and refocus the sweet baked snacks segment for sustainable growth and margin expansion, and in each of our businesses we are focusing on being where the consumer is shopping and growing share with our strategic customers. Second, embed transformation in our everyday mindset through a continued focus on safety, quality, reliability, and cost, integrating savings to drive investment in our brands and aspiring to generate over $1 billion in free cash flow annually while executing on our capital deployment strategy.

Our strategic priorities for Fiscal Year 2026 are as follows. First, accelerate organic growth by investing in our key platforms while also enabling the delivery of brands that meaningfully support total company profitability. This includes working to stabilize and refocus the sweet baked snacks segment for sustainable growth and margin expansion, and in each of our businesses we are focusing on being where the consumer is shopping and growing share with our strategic customers. Second, embed transformation in our everyday mindset through a continued focus on safety, quality, reliability, and cost, integrating savings to drive investment in our brands and aspiring to generate over $1 billion in free cash flow annually while executing on our capital deployment strategy.

Mark Smucker: Our strategic priorities for fiscal year 2026 are as follows. First, accelerate organic growth by investing in our key platforms while also enabling the delivery of brands that meaningfully support total company profitability. This includes working to stabilize and refocus the sweet baked snack segment for sustainable growth and margin expansion. And in each of our businesses, we are focusing on being where the consumer is shopping and growing share with our strategic customers. Second, embed transformation in our everyday mindset through a continued focus on safety, quality, reliability, and cost. integrating savings to drive investment in our brands and aspiring to generate over $1 billion in free cash flow annually while executing on our capital deployment strategy.

Speaker Change: First accelerate organic growth by investing in our key platforms, while also enabling the delivery of brands that meaningfully support total company profitability.

Speaker Change: This includes working to stabilize and refocus the sweet baked snack segment for sustainable growth and margin expansion.

Speaker Change: And in each of our businesses, we are focusing on being where the consumer is shopping and growing share with our strategic customers.

Speaker Change: Second embed transformation in our everyday mindset through a continued focus on safety quality reliability and cost.

Speaker Change: Integrating savings to drive investment in our brands and aspiring to generate over $1 billion in free cash flow annually, while executing on our capital deployment strategy.

Speaker Change: And third we will remain true to our basic beliefs by fostering a be bold mindset accelerating our pace of change to grow our competitive edge, while enabling greater speed and agility across the organization.

Mark Smucker: And third, we will remain true to our basic beliefs by fostering a be bold mindset, accelerating our pace of change to grow our competitive edge while enabling greater speed and agility across the organization. This includes continuing to evolve our brands and embed them into today's culture while ensuring we meet the needs of the consumer. As we execute these priorities and position the company for long-term growth, we acknowledge that we continue to operate in a dynamic environment including evolving macroeconomic factors, record high Green Coffee costs, implications from tariffs, regulatory and policy changes, and consumers that continue to seek value. Given these factors, we are being cautious in our Fiscal Year 2026 guidance and are providing a wider range. Net sales are expected to increase 2% to 4%. Comparable Net Sales are expected to increase 4.5% at the midpoint of the guidance range.

And third, we will remain true to our basic beliefs by fostering a be bold mindset, accelerating our pace of change to grow our competitive edge while enabling greater speed and agility across the organization. This includes continuing to evolve our brands and embed them into today's culture while ensuring we meet the needs of the consumer. As we execute these priorities and position the company for long-term growth, we acknowledge that we continue to operate in a dynamic environment including evolving macroeconomic factors, record high Green Coffee costs, implications from tariffs, regulatory and policy changes, and consumers that continue to seek value. Given these factors, we are being cautious in our Fiscal Year 2026 guidance and are providing a wider range. Net sales are expected to increase 2% to 4%. Comparable Net Sales are expected to increase 4.5% at the midpoint of the guidance range.

Mark Smucker: And third, we will remain true to our basic beliefs by fostering a be bold mindset, accelerating our pace of change to grow our competitive edge, while enabling greater speed and agility across the organization. This includes continuing to evolve our brands and embed them into today's culture, while ensuring we meet the needs of the consumer. As we execute these priorities and position the company for long-term growth, we acknowledge that we continue to operate in a dynamic environment including evolving macroeconomic factors, record high green coffee costs, implications from tariffs, regulatory and policy changes, and consumers that continue to seek value.

Speaker Change: This includes continuing to evolve our brands and embed them into today's culture, while ensuring we meet the needs of the consumer.

Speaker Change: As we execute these priorities and position the company for long term growth. We acknowledged that we continue to operate in a dynamic environment, including evolving macro economic factors record high Green coffee cost implications from tariffs regulatory and policy changes.

Speaker Change: <unk> and consumers that continue to seek value given these factors we are being cautious in our fiscal year 2026 guidance and are providing a wider range.

Mark Smucker: Given these factors, we are being cautious in our fiscal year 2026 guidance and are providing a wider range. net sales are expected to increase 2 to 4%. Comparable net sales are expected to increase 4.5% at the midpoint of the guidance range. The increase in net sales will be supported by growth in each of our U.S. retail segments when excluding reduced contract manufacturing sales related to the divested pet food brands and international and away from home. This reflects higher net price realization for the total company and ongoing brand momentum for our key growth platforms, including anticipated volume mix growth for the Uncrustables, Cafe Bustelo, Meow Mix, and Milkbone brands.

Speaker Change: Net sales are expected to increase 2% to 4%.

Speaker Change: Comparable net sales are expected to increase four 5% at the midpoint of the guidance range.

Speaker Change: The increase in net sales will be supported by growth in each of our U S. Retail segment, when excluding reduced contract manufacturing sales related to the divested pet food brands and international and away from home.

Mark Smucker: The increase in net sales will be supported by growth in each of our US Retail segments when excluding reduced contract manufacturing sales related to the divested pet food brands and international and away from home. This reflects higher net price realization for the total company and ongoing brand momentum for our key growth platforms, including anticipated volume mix growth for the Uncrustables, Café Bustelo, Meow Mix, and Milk-Bone brands. We anticipate total company volume mix to decline, largely driven by our price elasticity of demand assumptions for coffee and a decline in our Sweet Baked Snacks segment. Adjusted earnings per share is expected to be in the range of $8.50 to 9.50.

The increase in net sales will be supported by growth in each of our US Retail segments when excluding reduced contract manufacturing sales related to the divested pet food brands and international and away from home. This reflects higher net price realization for the total company and ongoing brand momentum for our key growth platforms, including anticipated volume mix growth for the Uncrustables, Café Bustelo, Meow Mix, and Milk-Bone brands. We anticipate total company volume mix to decline, largely driven by our price elasticity of demand assumptions for coffee and a decline in our Sweet Baked Snacks segment. Adjusted earnings per share is expected to be in the range of $8.50 to 9.50.

Speaker Change: This reflects higher net price realization for the total company and ongoing brand momentum for our key growth platforms, including anticipated volume mix growth for the <unk> Cafe, Bustillo, meow mix and milk bone brands.

Speaker Change: We anticipate total company volume mix to decline largely driven by our price elasticity of demand assumptions for coffee and a decline in our sweet baked snack segment.

Mark Smucker: We anticipate total company volume mix to decline, largely driven by our price elasticity of demand assumptions for coffee and a decline in our sweet baked snack segment. adjusted earnings per share is expected to be in the range of $8.50 to $9.50 This reflects the impact from our coffee price elasticity of demand assumptions, increased marketing investments for our key growth platforms, headwinds in the sweet baked snack segment, and tariff. partially offset by the positive tailwinds benefiting the business. Embedded in our guidance range are our assumptions related to the impact from tariffs in the current environment. As a domestic food producer, we are relatively less exposed to tariffs compared to other industries.

Speaker Change: Adjusted earnings per share is expected to be in the range of $8 50 to $9 50.

Speaker Change: This reflects the impact from our coffee price elasticity of demand assumptions increased marketing investments for our key growth platforms headwinds in the sweet baked snack segment and tariffs par.

Mark Smucker: This reflects the impact from our coffee price elasticity of demand assumptions, increased marketing investments for our key growth platforms, headwinds in the Sweet Baked Snacks segment, and tariffs partially offset by the positive tailwinds based on benefiting the business. Embedded in our guidance range are our assumptions related to the impact from tariffs in the current environment. As a domestic food producer, we are relatively less exposed to tariffs compared to other industries. That said, the current US tariff impact on green coffee is our largest exposure that we will manage. On top of navigating record high costs for the commodity, green coffee is an unavailable natural resource that cannot be grown in the continental United States due to its reliance on a tropical climate.

This reflects the impact from our coffee price elasticity of demand assumptions, increased marketing investments for our key growth platforms, headwinds in the Sweet Baked Snacks segment, and tariffs partially offset by the positive tailwinds based on benefiting the business. Embedded in our guidance range are our assumptions related to the impact from tariffs in the current environment. As a domestic food producer, we are relatively less exposed to tariffs compared to other industries. That said, the current US tariff impact on green coffee is our largest exposure that we will manage. On top of navigating record high costs for the commodity, green coffee is an unavailable natural resource that cannot be grown in the continental United States due to its reliance on a tropical climate.

Speaker Change: Partially offset by the positive tailwind benefiting the business.

Speaker Change: Embedded in our guidance range are our assumptions related to the impact from tariffs in the current environment.

Speaker Change: As a domestic food producer, we are relatively less exposed to tariffs compared to other industries that said the current U S tariff impact on Green coffee is our largest exposure that we will manage on top of navigating record high costs for the commodity.

Mark Smucker: That said, the current U.S. tariff impact on green coffee is our largest exposure that we will manage on top of navigating record high costs for the commodity. Green coffee is an unavailable natural resource that cannot be grown in the continental United States due to its reliance on a tropical climate. We currently purchase approximately 500 million pounds of green coffee annually, with the majority coming from Brazil and Vietnam, the two largest coffee producing countries. Outside of coffee, the vast majority of our U.S. production is sourced domestically. However, there is some sourcing of finished goods and ingredients that are subject to tariffs as things stand today.

Speaker Change: Green coffee is an unavailable natural resource that cannot be grown in the continental United States due to its reliance on a tropical climate.

Speaker Change: We currently purchase approximately 500 million pounds of Green coffee annually with the majority coming from Brazil, and Vietnam. The two largest coffee producing countries outside of coffee. The vast majority of our U S production is sourced domestically. However.

Mark Smucker: We currently purchase approximately 500 million pounds of green coffee annually, with the majority coming from Brazil and Vietnam, the two largest coffee producing countries. Outside of coffee, the vast majority of our US production is sourced domestically. However, there is some sourcing of finished goods and ingredients that are subject to tariffs. As things stand today, this has been factored into our outlook, and we are working to mitigate these cost increases through a combination of alternative sourcing strategies, supply chain optimization, and responsible pricing. In closing, while we expect the external environment will continue to be dynamic, we remain confident in our strategy.

We currently purchase approximately 500 million pounds of green coffee annually, with the majority coming from Brazil and Vietnam, the two largest coffee producing countries. Outside of coffee, the vast majority of our US production is sourced domestically. However, there is some sourcing of finished goods and ingredients that are subject to tariffs. As things stand today, this has been factored into our outlook, and we are working to mitigate these cost increases through a combination of alternative sourcing strategies, supply chain optimization, and responsible pricing. In closing, while we expect the external environment will continue to be dynamic, we remain confident in our strategy.

Speaker Change: Sure. There is some sourcing of finished goods and ingredients that are subject to tariffs as things stand today.

Speaker Change: This has been factored into our outlook and we are working to mitigate these cost increases through a combination of alternative sourcing strategies supply chain optimization and responsible pricing.

Mark Smucker: This has been factored into our outlook, and we are working to mitigate these cost increases through a combination of alternative sourcing strategies, supply chain optimization, and responsible pricing.

Speaker Change: In closing.

Mark Smucker: In closing, while we expect the external environment will continue to be dynamic, we remain confident in our strategy. We operate in attractive categories with leading brands and offerings ranging from value to premium. And as we look ahead, we remain focused on investing in our key growth platforms and executing on our strategic priorities, which will enable us to deliver long term growth and increase shareholder value.

Speaker Change: While we expect the external environment will continue to be dynamic we remain confident in our strategy, we operate in attractive categories with leading brands and offerings ranging from value to premium.

Mark Smucker: We operate in attractive categories with leading brands and offerings ranging from value to premium, and as we look ahead, we remain focused on investing in our key growth platforms and executing on our strategic priorities, which will enable us to deliver long-term growth and increase shareholder value. Before I close, I would like to extend my appreciation to all of our employees for their unwavering focus, dedication, and outstanding contributions. With that, I'll turn it over to Tucker for additional insight on our financials and our fiscal 2026 outlook.

We operate in attractive categories with leading brands and offerings ranging from value to premium, and as we look ahead, we remain focused on investing in our key growth platforms and executing on our strategic priorities, which will enable us to deliver long-term growth and increase shareholder value. Before I close, I would like to extend my appreciation to all of our employees for their unwavering focus, dedication, and outstanding contributions. With that, I'll turn it over to Tucker for additional insight on our financials and our fiscal 2026 outlook.

Speaker Change: And as we look ahead, we remain focused on investing in our key growth platforms and executing on our strategic priorities, which will enable us to deliver long term growth and increase shareholder value.

Speaker Change: Before I close I would like to extend my appreciation to all of our employees for their unwavering focus dedication and outstanding contributions with that I'll turn it over to Tucker for additional insight on our financials and our fiscal 2026.

Mark Smucker: Before I close, I would like to extend my appreciation to all of our employees for their unwavering focus, dedication, and outstanding contributions.

Tucker Marshall: With that, I'll turn it over to Tucker for additional insight on our financials and our fiscal 2026 outlook. Thank you, Mark. Good morning, everyone. I will begin by providing detail on the non-cash impairment charges reflected in our fourth quarter GAAP results. We recognized an $867 million dollar impairment charge related to the goodwill of the Sweetbake Snacks reporting unit and a $113 million dollar impairment charge related to the Hostess Brand Indefinite Live trademark. These impairment charges are driven by the continued underperformance of the Sweetbake Snacks segment and updated assumptions following the re-evaluation of the strategic priorities of this business to three drivers.

Speaker Change: Look.

Tucker Marshall: Thank you Mark.

Tucker Marshall: Thank you, Mark. Good morning, everyone. I will begin by providing detail on the non-cash impairment charges reflected in our fourth quarter GAAP results. We recognized an $867 million impairment charge related to the goodwill of the Sweet Baked Snacks reporting unit and a $113 million impairment charge related to the Hostess brand indefinite-lived trademark. These impairment charges are driven by the continued underperformance of the Sweet Baked Snacks segment and updated assumptions following the re-evaluation of the strategic priorities of this business to three: strengthening the portfolio, elevating our execution, and reigniting sustainable growth. Due to the continued underperformance of the sweet baked goods category relative to when Hostess Brands was acquired, we now anticipate 3% net sales growth over the long term. Through our revised strategy, we will stabilize the Hostess brand's performance and deliver net sales and segment profit growth for the business.

Speaker Change: Good morning, everyone.

Speaker Change: I will begin by providing detail on the noncash impairment charges reflected in our fourth quarter GAAP results.

Speaker Change: We recognized an $867 million impairment charge related to the goodwill of the sweet baked snacks reporting unit and a $113 million impairment charge related to the hostess brand indefinite live trademark.

Speaker Change: These impairment charges are driven by the continued underperformance of the sweet baked snack segment and updated assumptions. Following the re evaluation of the strategic priorities of this business to three drivers strengthening the portfolio elevating our execution and reigniting sustainable growth.

Tucker Marshall: Strengthening the Portfolio, Elevating our Execution, and Reigniting Sustainable Growth. Due to the continued underperformance of the sweet baked goods category relative to when Hostess Brands was acquired, we now anticipate 3% net sales growth over the long term. Through our revised strategy, we will stabilize the hostess brand's performance and deliver net sales and segment profit growth for the business.

Speaker Change: Due to the continued underperformance of the sweet baked goods category relative to when hostess brands was acquired we now anticipate 3% net sales growth over the long term.

Speaker Change: Our revised strategy, we will stabilize the hostess brands' performance and delivered net sales and segment profit growth for the business.

Speaker Change: Now I'll provide an overview of our fourth quarter results and then give additional details on our financial outlook for fiscal year 2026.

Tucker Marshall: Now, I'll provide an overview of our fourth quarter results, and then give additional details on our financial outlook for fiscal year 2020. In the quarter, net sales declined 3%. Comparable net sales decreased 1% excluding the impact of divestitures and foreign currency exchange. Net sales was flat versus the prior year, when also excluding contract manufacturing sales related to the divested pet food brand. The decrease in comparable net sales reflects a three percentage point decrease in volume mix driven by decreases for dog snacks, sweet baked goods, lower contract manufacturing sales related to the divested pet food brands, and fruit spreads, partially offset by an increase for uncrustable sandwiches.

Tucker Marshall: Now I'll provide an overview of our fourth quarter results and then give additional details on our financial outlook for fiscal year 2026. In the quarter, net sales declined 3%. Comparable net sales decreased 1% excluding the impact of divestitures and foreign currency exchange. Net sales was flat versus the prior year when also excluding contract manufacturing sales related to the divested pet food brands. The decrease in comparable net sales reflects a 3 percentage point decrease in volume mix driven by decreases for dog snacks, sweet baked goods, lower contract manufacturing sales related to the divested pet food brands, and fruit spreads, partially offset by an increase for Uncrustables sandwiches. Higher net price realization increased net sales by 3% driven by higher net pricing for coffee, partially offset by lower net pricing for sweet baked goods and dog snacks.

Now I'll provide an overview of our fourth quarter results and then give additional details on our financial outlook for fiscal year 2026. In the quarter, net sales declined 3%. Comparable net sales decreased 1% excluding the impact of divestitures and foreign currency exchange. Net sales was flat versus the prior year when also excluding contract manufacturing sales related to the divested pet food brands. The decrease in comparable net sales reflects a 3 percentage point decrease in volume mix driven by decreases for dog snacks, sweet baked goods, lower contract manufacturing sales related to the divested pet food brands, and fruit spreads, partially offset by an increase for Uncrustables sandwiches. Higher net price realization increased net sales by 3% driven by higher net pricing for coffee, partially offset by lower net pricing for sweet baked goods and dog snacks.

Speaker Change: In the quarter net sales declined 3%.

Speaker Change: Comparable net sales decreased 1%.

Speaker Change: Excluding the impact of divestitures and foreign currency exchange net.

Speaker Change: Net sales was flat versus the prior year when also excluding contract manufacturing sales related to the divested pet food brands.

Speaker Change: The decrease in comparable net sales reflects a three percentage point decrease in volume mix driven by decreases for dogs snacks, sweet baked goods lower contract manufacturing sales related to the divested pet food brands.

Speaker Change: And fruit spreads, partially offset by an increase for on cross the bowls sandwiches.

Speaker Change: Higher net price realization increased net sales by 3% driven by higher net pricing for coffee, partially offset by lower net pricing for sweet baked goods and dog snacks.

Tucker Marshall: Higher net price realization increased net sales by 3%, driven by higher net pricing for coffee, partially offset by lower net pricing for sweet baked goods and dog snacks. Net sales in the quarter were impacted by retailer inventory headwinds and U.S. retail pet foods, in addition to elevated trade recognition in the quarter for sweetbake snacks. Outside of these two elements, total company net sales overall came in line with expectations for the quarter. Adjusted gross profit decreased $84 million or 9% compared to the prior year. The decrease reflects higher costs, unfavorable volume mix, and the non-comparable impact of divestitures, partially offset by higher net price realization.

Speaker Change: Net sales in the quarter were impacted by retailer inventory headwinds in U S. Retail pet foods. In addition to elevated trade recognition in the quarter for sweet baked snacks.

Tucker Marshall: Net sales in the quarter were impacted by retailer inventory headwinds in US Retail pet foods in addition to elevated trade recognition in the quarter for sweet baked snacks. Outside of these two elements, total company net sales overall came in line with expectations for the quarter. Adjusted gross profit decreased $84 million or 9% compared to the prior year. The decrease reflects higher costs, unfavorable volume/mix, and the non-comparable impact of divestitures partially offset by higher net price realization. Adjusted operating income decreased $39 million or 8%, reflecting the decreased gross profit partially offset by favorable SDA expenses. The favorability in SDA was driven by decreased administrative expenses, lower marketing spend, and reduced pre-production expenses primarily related to the new Uncrustables sandwiches manufacturing facility. Below operating income, net interest expense decreased $3 million driven by reduced debt outstanding.

Net sales in the quarter were impacted by retailer inventory headwinds in US Retail pet foods in addition to elevated trade recognition in the quarter for sweet baked snacks. Outside of these two elements, total company net sales overall came in line with expectations for the quarter. Adjusted gross profit decreased $84 million or 9% compared to the prior year. The decrease reflects higher costs, unfavorable volume/mix, and the non-comparable impact of divestitures partially offset by higher net price realization. Adjusted operating income decreased $39 million or 8%, reflecting the decreased gross profit partially offset by favorable SDA expenses. The favorability in SDA was driven by decreased administrative expenses, lower marketing spend, and reduced pre-production expenses primarily related to the new Uncrustables sandwiches manufacturing facility. Below operating income, net interest expense decreased $3 million driven by reduced debt outstanding.

Speaker Change: Outside of these two elements total company net sales overall came in line with expectations for the quarter.

Speaker Change: Adjusted gross profit decreased $84 million or 9% compared to the prior year.

Speaker Change: The decrease reflects higher costs unfavorable volume mix and the non comparable impact of divestitures, partially offset by higher net price realization.

Speaker Change: Adjusted operating income decreased $39 million or 8%, reflecting the decreased gross profit, partially offset by favorable SG&A expenses.

Tucker Marshall: Adjusted operating income decreased $39 million, or 8%, reflecting the decreased growth profit, partially offset by favorable SD&A expenses. The favorability in SDNA was driven by decreased administrative expenses, lower marketing spend, and reduced pre-production expenses primarily related to the new Uncrustable Sandwiches manufacturing facility. Below Operating Income, Net Interest Expense Decreased $3 Million Driven by Reduced Debt Outstanding The adjusted effective income tax rate was 23.9% compared to 23.2% in the prior year. Factoring in all these considerations, along with the weighted average shares outstanding of $106.7 million, fourth quarter adjusted earnings per share was $2.31, a decrease of 13% versus the prior year.

Speaker Change: The favorability in SG&A was driven by decreased administrative expenses lower marketing spend and reduced preproduction expenses, primarily related to the new across the bowls sandwiches manufacturing facility.

Speaker Change: Below operating income net interest expense decreased $3 million driven by reduced debt outstanding.

Speaker Change: The adjusted effective income tax rate was 23, 9% compared to 23, 2% in the prior year.

Tucker Marshall: The adjusted effective income tax rate was 23.9% compared to 23.2% in the prior year. Factoring in all these considerations along with a weighted average shares outstanding of 106.7 million, fourth quarter adjusted earnings per share was $2.31, a decrease of 13% versus the prior year. Turning to our segment results, in the US Retail Coffee segment net sales increased 11% versus the prior year. Net price realization increased net sales by 10 percentage points driven by higher net pricing for the Folgers and Café Bustelo brands. Volume mix was neutral to net sales reflecting an increase for the Café Bustelo brand, mostly offset by a decrease for the Folgers brand. US Retail Coffee segment profit was neutral versus the prior year as higher net price realization and lower marketing expenses were largely offset by higher commodity costs.

The adjusted effective income tax rate was 23.9% compared to 23.2% in the prior year. Factoring in all these considerations along with a weighted average shares outstanding of 106.7 million, fourth quarter adjusted earnings per share was $2.31, a decrease of 13% versus the prior year. Turning to our segment results, in the US Retail Coffee segment net sales increased 11% versus the prior year. Net price realization increased net sales by 10 percentage points driven by higher net pricing for the Folgers and Café Bustelo brands. Volume mix was neutral to net sales reflecting an increase for the Café Bustelo brand, mostly offset by a decrease for the Folgers brand. US Retail Coffee segment profit was neutral versus the prior year as higher net price realization and lower marketing expenses were largely offset by higher commodity costs.

Speaker Change: Factoring in all of these considerations along with a weighted average shares outstanding of $106 7 million fourth quarter adjusted earnings per share was $2 31, a decrease of 13% versus the prior year.

Speaker Change: Turning to our segment results.

Tucker Marshall: Turning to our segment results, in the U.S. retail coffee segment, net sales increased 11% versus the prior year. Net price realization increased net sales by 10 percentage points, driven by higher net pricing for the Folgers and Café Bustelo brands. Volume mix was neutral to net sales, reflecting an increase for the Café Bustelo brand, mostly offset by a decrease for the Folgers.

Speaker Change: In the U S retail coffee segment.

Speaker Change: Net sales increased 11% versus the prior year.

Speaker Change: Net price realization increased net sales by 10 percentage points driven by higher net pricing for the folgers and cafe with stellar brands.

Speaker Change: Volume mix was neutral to net sales, reflecting an increase for the cafe bustillo brands, mostly offset by a decrease for the Folgers brand.

Speaker Change: U S retail coffee segment profit was neutral versus the prior year as.

Tucker Marshall: U.S. retail coffee segment profit was neutral versus the prior year, as higher net price realization and lower marketing expenses were largely offset by higher commodity costs.

Speaker Change: As higher net price realization and lower marketing expenses were largely offset by higher commodity costs.

Speaker Change: In U S retail frozen handheld and spreads net sales was neutral versus the prior year.

Tucker Marshall: In US Retail Frozen Handheld and Spreads, net sales was neutral versus the prior year. Lower net price realization decreased net sales by 1 percentage point primarily reflecting lower net price realization for Jif peanut butter and Uncrustables sandwiches partially offset by a list price increase for Smucker's Toppings and Syrups. Volume mix increased net sales by 1 percentage point driven by an increase for Uncrustables sandwiches which was partially offset by a decrease for Smucker's Fruit Spreads. US Retail Frozen Handheld and Spreads segment profit decreased 5% reflecting equipment write-off charges, higher costs, and lower net price realization partially offset by lower pre-production expenses largely related to the new Uncrustables sandwiches manufacturing facility and lower marketing expenses. In US Retail Pet Foods, net sales decreased 13% versus the prior year.

In US Retail Frozen Handheld and Spreads, net sales was neutral versus the prior year. Lower net price realization decreased net sales by 1 percentage point primarily reflecting lower net price realization for Jif peanut butter and Uncrustables sandwiches partially offset by a list price increase for Smucker's Toppings and Syrups. Volume mix increased net sales by 1 percentage point driven by an increase for Uncrustables sandwiches which was partially offset by a decrease for Smucker's Fruit Spreads. US Retail Frozen Handheld and Spreads segment profit decreased 5% reflecting equipment write-off charges, higher costs, and lower net price realization partially offset by lower pre-production expenses largely related to the new Uncrustables sandwiches manufacturing facility and lower marketing expenses. In US Retail Pet Foods, net sales decreased 13% versus the prior year.

Tucker Marshall: and U.S. retail frozen handheld and spreads, net sales was neutral versus the prior year. Lower net price realization decreased net sales by one percentage point, primarily reflecting lower net price realization for Jif peanut butter and uncrustable sandwiches. Partially offset by a list price increase for Smucker toppings and syrups. Volume Mix increased net sales by one percentage point, driven by an increase for Uncrustable Sandwiches, which was partially offset by a decrease for Smucker Fruit Spreads.

Speaker Change: Lower net price realization decreased net sales by one percentage point pri.

Speaker Change: Primarily reflecting lower net price realization for jif, peanut butter and across the bowls sandwiches.

Speaker Change: Partially offset by a list price increase for smucker toppings and syrups.

Speaker Change: Volume mix increased net sales by one percentage point driven by an increase for across the bowls sandwiches, which was partially offset by a decrease for smucker fruit spreads.

Speaker Change: U S retail frozen handheld and spread segment profit decreased 5%, reflecting equipment write off charges higher costs and lower net price realization, partially offset by lower preproduction expenses largely related to the new across the bowls sandwiches manufacturing facility and lower marketing expenses.

Tucker Marshall: U.S. retail frozen handheld and spread segment profit decreased 5 percent, reflecting equipment write-off charges, higher costs, and lower net price realization, partially offset by lower pre-production expenses largely related to the new Uncrustable Sandwiches manufacturing facility and lower marketing expenses.

Speaker Change: In U S retail pet foods net sales decreased 13% versus the prior year.

Tucker Marshall: In U.S. retail pet foods, net sales decreased 13% versus the prior year. Volume mix decreased net sales by 11 percentage points, driven by a decrease for dog snacks and a $16 million decrease in contract manufacturing sales related to the divested pet food brand. Lower net price realization decreased net sales by two percentage points, primarily driven by dog smacks and cat food. Net sales declined 10% versus the prior year when excluding contract manufacturing sales related to the divested pet food brand.

Speaker Change: Volume mix decreased net sales by 11 percentage points driven by a decrease for dog snacks, and a $16 million decrease in contract manufacturing sales related to the divested pet food brands.

Tucker Marshall: Volume mix decreased net sales by 11 percentage points driven by a decrease for dog snacks, and a $16 million decrease in contract manufacturing sales related to the divested pet food brands. Lower net price realization decreased net sales by 2 percentage points primarily driven by dog snacks, and cat food. Net sales declined 10% versus the prior year when excluding contract manufacturing sales related to the divested pet food brands. US retail pet foods segment profit decreased 7% driven by an unfavorable volume mix, and lower net price realization partially offset by lower costs, and decreased marketing expenses. In the sweet baked snacks segment, net sales decreased 26% versus the prior year excluding non-comparable net sales in the prior year related to the divestitures of the Voortman business, and certain sweet baked snacks value brands. Net sales decreased 14%.

Volume mix decreased net sales by 11 percentage points driven by a decrease for dog snacks, and a $16 million decrease in contract manufacturing sales related to the divested pet food brands. Lower net price realization decreased net sales by 2 percentage points primarily driven by dog snacks, and cat food. Net sales declined 10% versus the prior year when excluding contract manufacturing sales related to the divested pet food brands. US retail pet foods segment profit decreased 7% driven by an unfavorable volume mix, and lower net price realization partially offset by lower costs, and decreased marketing expenses. In the sweet baked snacks segment, net sales decreased 26% versus the prior year excluding non-comparable net sales in the prior year related to the divestitures of the Voortman business, and certain sweet baked snacks value brands. Net sales decreased 14%.

Speaker Change: Lower net price realization decreased net sales by two percentage points, primarily driven by a dog snacks and cat food.

Speaker Change: That sales declined 10% versus the prior year, when excluding contract manufacturing sales related to the divested pet food brands.

Speaker Change: U S retail pet foods segment profit decreased 7% driven by an unfavorable volume mix and lower net price realization, partially offset by lower costs and decreased marketing expenses.

Tucker Marshall: U.S. retail pet food segment profit decreased 7%, driven by an unfavorable volume mix and lower net price realization, partially offset by lower costs and decreased marketing expenses. In the Sweetbake Snacks segment, net sales decreased 26% versus the prior year. Excluding non-comparable net sales in the prior year related to the divestitures of the Vortman business and certain Sweetbakes Snacks value brands, net sales decreased 14%. Volume Mix Decreased Net Sales by 9 Percentage Points Driven by Decrease for Snack Cakes, Donuts, and Private Label Products Lower net price realization decreased net sales by four percentage points, reflecting lower net pricing across the portfolio.

Speaker Change: And the street baked snack segment net sales decreased 26% versus the prior year.

Speaker Change: Excluding non comparable net sales in the prior year related to the divestitures of the <unk> business and certain sweet baked snacks value brands.

Speaker Change: Net sales decreased 14%.

Speaker Change: Volume mix decreased net sales by nine percentage points, driven by decrease for snack cakes donuts and private label products.

Tucker Marshall: Volume mix decreased net sales by 9 percentage points driven by decreases for snack cakes, donuts, and private label products. Lower net price realization decreased net sales by 4 percentage points reflecting lower net pricing across the portfolio. Sweet Baked Snacks segment profit decreased 72% primarily driven by higher costs, lower net price realization, unfavorable volume mix, and the impact of the non-comparable segment profit in the prior year related to the divested businesses. Lastly, in International and Away from Home net sales increased 3% excluding $4 million of unfavorable foreign currency exchange. Net sales increased 4%. Net price realization contributed a 6 percentage point increase to net sales reflecting higher net pricing for coffee. Volume mix decreased net sales by 1 percentage point as decreases for coffee and portion control products were partially offset by an increase for Uncrustables sandwiches.

Volume mix decreased net sales by 9 percentage points driven by decreases for snack cakes, donuts, and private label products. Lower net price realization decreased net sales by 4 percentage points reflecting lower net pricing across the portfolio. Sweet Baked Snacks segment profit decreased 72% primarily driven by higher costs, lower net price realization, unfavorable volume mix, and the impact of the non-comparable segment profit in the prior year related to the divested businesses. Lastly, in International and Away from Home net sales increased 3% excluding $4 million of unfavorable foreign currency exchange. Net sales increased 4%. Net price realization contributed a 6 percentage point increase to net sales reflecting higher net pricing for coffee. Volume mix decreased net sales by 1 percentage point as decreases for coffee and portion control products were partially offset by an increase for Uncrustables sandwiches.

Speaker Change: Lower net price realization decreased net sales by four percentage points, reflecting lower net pricing across the portfolio.

Speaker Change: Okay.

Speaker Change: Sweet baked snack segment profit decreased 72%, primarily driven by higher costs, lower net price realization and unfavorable volume mix and the impact of the non comparable segment profit in the prior year related to the divested businesses.

Tucker Marshall: Sweetbakes Snack segment profit decreased 72%, primarily driven by higher costs, lower net price realization, unfavorable volume mix, and the impact of the non-comparable segment profit in the prior year related to the divested business.

Speaker Change: Lastly, in international and away from home net sales increased 3%, excluding $4 million of unfavorable foreign currency exchange net sales increased 4%.

Tucker Marshall: Lastly, in international and away from home, net sales increased 3%. Excluding $4 million of unfavorable foreign currency exchange, net sales increased 4%. Net price realization contributed a six percentage point increase to net sales, reflecting higher net pricing for coffee. volume mix decreased net sales by one percentage point as decreases for coffee and portion control products were partially offset by an increase for uncrustable sandwiches. Net sales for the away from home business increased 5% on a comparable basis, led by a double digit percentage increase for uncrustable sandwiches. Net sales for the international business increased 4% on a comparable basis, largely driven by our coffee portfolio.

Speaker Change: Net price realization contributed a six percentage point increase to net sales, reflecting higher net pricing for coffee.

Speaker Change: Volume mix decreased net sales by one percentage point as decreases for coffee and portion control products were partially offset by an increase for across the bowls sandwiches.

Speaker Change: Net sales for the away from home business increased 5% on a comparable basis led by a double digit percentage increase for on crustal ball sandwiches.

Tucker Marshall: Net sales for the away-from-home business increased 5% on a comparable basis, led by a double-digit percentage increase for Uncrustables sandwiches. Net sales for the international business increased 4% on a comparable basis, largely driven by our coffee portfolio. International and away-from-home segment profit increased 13%, reflecting higher net price realization and lower pre-production expenses primarily related to the new Uncrustables sandwiches manufacturing facility, partially offset by higher costs. Fourth quarter free cash flow was $299 million compared to $298 million in the prior year, driven by a decrease in capital expenditures partially offset by a decrease in cash provided by operating activities. On a full year basis, free cash flow was $817 million, an increase of $174 million versus the prior year. Capital expenditures were $394 million, representing 4.5% of net sales, a decrease versus the prior year.

Net sales for the away-from-home business increased 5% on a comparable basis, led by a double-digit percentage increase for Uncrustables sandwiches. Net sales for the international business increased 4% on a comparable basis, largely driven by our coffee portfolio. International and away-from-home segment profit increased 13%, reflecting higher net price realization and lower pre-production expenses primarily related to the new Uncrustables sandwiches manufacturing facility, partially offset by higher costs. Fourth quarter free cash flow was $299 million compared to $298 million in the prior year, driven by a decrease in capital expenditures partially offset by a decrease in cash provided by operating activities. On a full year basis, free cash flow was $817 million, an increase of $174 million versus the prior year. Capital expenditures were $394 million, representing 4.5% of net sales, a decrease versus the prior year.

Speaker Change: Net sales for the international business increased 4% on a comparable basis, largely driven by our coffee portfolio.

Speaker Change: International and away from home segment profit increased 13%, reflecting higher net price realization and lower preproduction expenses, primarily related to the new across the bowls sandwiches manufacturing facility.

Tucker Marshall: International and away from home segment profit increased 13% reflecting higher net price realization and lower pre-production expenses primarily related to the new Uncrustable Sandwiches manufacturing facility. partially offset by higher cost.

Speaker Change: We offset by higher costs.

Speaker Change: Fourth quarter free cash flow was $299 million compared to $298 million in the prior year driven by a decrease in capital expenditures, partially offset by a decrease in cash provided by operating activities.

Tucker Marshall: Fourth quarter free cash flow was $299 million compared to $298 million in the prior year, driven by a decrease in capital expenditures partially offset by a decrease in cash provided by operating activities. On a full year basis, free cash flow was $817 million, an increase of $174 million versus the prior year. Capital expenditures were $394 million, representing a 4.5% of net sales, a decrease versus the prior year. Our results demonstrate the continued progress we are making toward our long-term strategic target of capital expenditures at approximately 3.5% of net sales. Leveraging our strong cash generation, we returned approximately $455 million of cash to shareholders through dividends in the fiscal year.

Speaker Change: On a full year basis free cash flow was $817 million, an increase of $174 million versus the prior year.

Speaker Change: Capital expenditures were $394 million, representing a four 5% of net sales a decrease versus the prior year.

Speaker Change: Our results demonstrate the continued progress we are making toward our long term strategic target of capital expenditures at approximately three 5% of net sales.

Tucker Marshall: Our results demonstrate the continued progress we are making toward our long-term strategic target of capital expenditures at approximately 3.5% of net sales. Leveraging our strong cash generation, we returned approximately $455 million of cash to shareholders through dividends in the fiscal year. We also increased our quarterly dividend by 2%, marking 23 consecutive fiscal years of dividend growth. We finished the year with a cash and cash equivalent balance of $70 million and a total net debt balance of $7.6 billion, based on a trailing twelve-month Adjusted EBITDA of approximately $2.1 billion. Our leverage ratio stands at 3.6x. We plan on continuing to prioritize debt reduction by paying down approximately $500 million of debt annually over each of the next two years.

Our results demonstrate the continued progress we are making toward our long-term strategic target of capital expenditures at approximately 3.5% of net sales. Leveraging our strong cash generation, we returned approximately $455 million of cash to shareholders through dividends in the fiscal year. We also increased our quarterly dividend by 2%, marking 23 consecutive fiscal years of dividend growth. We finished the year with a cash and cash equivalent balance of $70 million and a total net debt balance of $7.6 billion, based on a trailing twelve-month Adjusted EBITDA of approximately $2.1 billion. Our leverage ratio stands at 3.6x. We plan on continuing to prioritize debt reduction by paying down approximately $500 million of debt annually over each of the next two years.

Speaker Change: Leveraging our strong cash generation, we returned approximately $455 million of cash to shareholders through dividends and the fiscal year.

Speaker Change: We also increased our quarterly dividend by 2%, marking 23 consecutive fiscal years of dividend growth.

Tucker Marshall: We also increased our quarterly dividend by 2%, marking 23 consecutive fiscal years of dividend growth. We finished the year with a cash and cash equivalent balance of $70 million and a total net debt balance of $7.6 billion. Based on a trailing 12-month adjusted EBITDA of approximately $2.1 billion, our leverage ratio stands at 3.6 times. We plan on continuing to prioritize debt reduction by paying down approximately $500 million of debt annually over each of the next two years. With this anticipated deleveraging and overall business growth, we anticipate a leverage ratio at or below three times net debt to adjusted EBITDA by the end of our fiscal year 2027.

Speaker Change: We finished the year with a cash and cash equivalent balance of $70 million and a total net debt balance of $7 6 billion.

Speaker Change: Based on a trailing 12 month adjusted EBITDA of approximately $2 1 billion, our leverage ratio stands at three six times.

Speaker Change: We plan on continuing to prioritize debt reduction by paying down approximately $500 million of debt annually over each of the next two years.

Speaker Change: With this anticipated deleveraging and overall business growth, we anticipate a leverage ratio at or below three times net debt to adjusted EBITDA by the end of our fiscal year 2027.

Tucker Marshall: With this anticipated deleveraging and overall business growth, we anticipate a leverage ratio at or below 3x net debt to adjusted EBITDA by the end of our fiscal year 2027. This level of debt provides financial flexibility for a balanced approach to capital deployment. Let me now provide additional color on our outlook for fiscal year 2026. We continue to operate in a dynamic and evolving external environment, including tariffs and related trade impacts, regulatory and policy changes, ongoing input inflation, and changes in consumer behavior that impact our fiscal year 2026 outlook. This guidance reflects the company's expectations based on its current understanding of these factors.

With this anticipated deleveraging and overall business growth, we anticipate a leverage ratio at or below 3x net debt to adjusted EBITDA by the end of our fiscal year 2027. This level of debt provides financial flexibility for a balanced approach to capital deployment. Let me now provide additional color on our outlook for fiscal year 2026. We continue to operate in a dynamic and evolving external environment, including tariffs and related trade impacts, regulatory and policy changes, ongoing input inflation, and changes in consumer behavior that impact our fiscal year 2026 outlook. This guidance reflects the company's expectations based on its current understanding of these factors.

Speaker Change: This level of debt provides financial flexibility for a balanced approach to capital deployment.

Tucker Marshall: This level of debt provides financial flexibility for a balanced approach to capital deployment.

Speaker Change: Let me now provide additional color on our outlook for fiscal year 2026.

Tucker Marshall: Let me now provide additional color on our outlook for fiscal year 2026. We continue to operate in a dynamic and evolving external environment, including tariffs and related trade impacts, regulatory and policy changes, ongoing input inflation, and changes in consumer behavior that impact our fiscal year 2026 outlook. This guidance reflects the company's expectations based on its current understanding of these factors. We expect full year net sales to increase 2 to 4% compared to the prior year, reflecting a $135 million headwind from lapping sales of the divested Mortman business and certain Sweetbake Snacks value brands. and a $38 million unfavorable impact from reduced contract manufacturing sales related to divested pet food brands, which we have now exited.

Speaker Change: We continue to operate in a dynamic and evolving external environment, including tariffs and related trade impacts regulatory and policy changes ongoing input inflation and changes in consumer behavior that impact our fiscal year 2026 outlook.

Speaker Change: This guidance reflects the companys expectations based on its current understanding of these factors.

Speaker Change: We expect full year net sales to increase 2% to 4% compared to the prior year, reflecting a $135 million headwind from lapping sales of the divested more than business and certain sweet baked snacks value brands.

Tucker Marshall: We expect full-year net sales to increase 2% to 4% compared to the prior year, reflecting a $135 million headwind from lapping sales of the divested Voortman business and certain Sweet Baked Snacks value brands, and a $38 million unfavorable impact from reduced contract manufacturing sales related to the divested pet food brands, which we have now exited. On a comparable basis, net sales are anticipated to increase approximately 4.5% at the midpoint. This reflects growth in each of our US Retail segments when excluding reduced contract manufacturing sales related to the divested pet food brands, and an international, away-from-home, and the Sweet Baked Snacks segment. We anticipate comparable net sales to decline low single digits as we look to our actions to stabilize the Hostess brand in the back half of the fiscal year.

We expect full-year net sales to increase 2% to 4% compared to the prior year, reflecting a $135 million headwind from lapping sales of the divested Voortman business and certain Sweet Baked Snacks value brands, and a $38 million unfavorable impact from reduced contract manufacturing sales related to the divested pet food brands, which we have now exited. On a comparable basis, net sales are anticipated to increase approximately 4.5% at the midpoint. This reflects growth in each of our US Retail segments when excluding reduced contract manufacturing sales related to the divested pet food brands, and an international, away-from-home, and the Sweet Baked Snacks segment. We anticipate comparable net sales to decline low single digits as we look to our actions to stabilize the Hostess brand in the back half of the fiscal year.

Speaker Change: And a $38 million unfavorable impact from reduced contract manufacturing sales related to the divested pet food brands, which we have now exited.

Speaker Change: On a comparable basis net sales are anticipated to increase approximately four 5% at the midpoint.

Tucker Marshall: On a comparable basis, net sales are anticipated to increase approximately 4.5% at the midpoint. This reflects growth in each of our U.S. retail segments when excluding reduced contract manufacturing sales related to the divested pet food brands and an international away from home. In the Sweetbake Snacks segment, we anticipate comparable net sales to decline, low single digits, as we look to our actions to stabilize the hostess brand in the back half of the fiscal year. Comparable net sales growth reflects higher net price realization, primarily due to list price increases to recover higher green coffee costs in our US retail coffee segment, and an international away from home, and a price increase for uncrustable sandwiches in the US retail frozen handheld and spread segment to recover increased costs.

Speaker Change: This reflects growth in each of our U S retail segments, when excluding reduced contract manufacturing sales related to the divested pet food brands and an international and away from home.

Speaker Change: And the street baked snack segment, we anticipate comparable net sales to decline low single digits as we look to our actions to stabilize the hostess brand in the back half of the fiscal year.

Speaker Change: Comparable net sales growth reflects higher net price realization, primarily due to list price increases to recover higher green coffee costs, and our U S retail coffee segment and in international and away from home and a price increase for on crustal sandwiches in the U S retail frozen handheld <unk>.

Tucker Marshall: Comparable net sales growth reflects higher net price realization primarily due to list price increases to recover higher green coffee costs in our US Retail coffee segment, and in international and away from home, and a price increase for Uncrustables sandwiches in the US Retail frozen hand held and spread segment to recover increased costs. Volume mix is anticipated to be unfavorable, largely driven by our US Retail coffee segment from the price elasticity demand assumptions contemplated in our guidance, and our Sweet Baked Snacks segment. As we continue to experience category and channel headwinds, we continue to see momentum for our key platforms including anticipated volume mix growth for the Uncrustables, Café Bustelo, Meow Mix, and Milk-Bone brands. We anticipate full-year adjusted gross profit margin of 35.5% to 36%.

Comparable net sales growth reflects higher net price realization primarily due to list price increases to recover higher green coffee costs in our US Retail coffee segment, and in international and away from home, and a price increase for Uncrustables sandwiches in the US Retail frozen hand held and spread segment to recover increased costs. Volume mix is anticipated to be unfavorable, largely driven by our US Retail coffee segment from the price elasticity demand assumptions contemplated in our guidance, and our Sweet Baked Snacks segment. As we continue to experience category and channel headwinds, we continue to see momentum for our key platforms including anticipated volume mix growth for the Uncrustables, Café Bustelo, Meow Mix, and Milk-Bone brands. We anticipate full-year adjusted gross profit margin of 35.5% to 36%.

Speaker Change: Spread segment to recover increased costs.

Speaker Change: Volume mix is anticipated to be unfavorable largely driven by our U S. Retail coffee segment from the price elasticity of demand assumptions contemplated in our guidance.

Tucker Marshall: Volume mix is anticipated to be unfavorable, largely driven by our U.S. retail coffee segment from the price elasticity of demand assumptions contemplated in our guidance and our sweet baked snacks segment as we continue to experience category and channel headwinds. We continue to see momentum for our key platforms, including anticipated volume mix growth for the Uncrustables, Cafe Bustelo, Meow Mix, and Milkbone brands. We anticipate full year adjusted growth profit margin of 35.5 to 36%. This reflects increased commodity and manufacturing costs and unfavorable volume mix, partially offset by higher net price benefits, cost and productivity savings for our transformation efforts, and the realization of synergy.

Speaker Change: And our sweet baked snacks segment, as we continue to experience category and channel headwinds.

Speaker Change: We continue to see momentum for our key platforms, including anticipated volume mix growth for the <unk> <unk>.

Bustillo: Hey, Bustillo, meow mix and milk bone brands.

Bustillo: We anticipate full year adjusted gross profit margin of 35.5% to 36%.

Bustillo: This reflects increased commodity and manufacturing costs and unfavorable volume mix, partially offset by higher net price benefits cost and productivity savings from our transformation efforts and the realization of synergies.

Tucker Marshall: This reflects increased commodity and manufacturing costs, and unfavorable volume mix partially offset by higher net price benefits, cost, and productivity savings from our transformation efforts and the realization of synergies. The net impact from our tariff assumptions factored into our adjusted gross profit margin is estimated to be an unfavorable impact of approximately 50 basis points largely reflected in the US retail coffee segment. SDA expenses are projected to increase by approximately 3%, primarily reflecting increased marketing investments in the Café Bustelo and Uncrustables brands. Total marketing expense is estimated to be 5.7% of net sales, an increase of 30 basis points or approximately $40 million versus the prior year. We anticipate net interest expense of approximately $380 million driven by continued debt paydown. Our adjusted effective income tax rate is anticipated to be 23.7% along with a full year weighted average share count of 106.7 million.

This reflects increased commodity and manufacturing costs, and unfavorable volume mix partially offset by higher net price benefits, cost, and productivity savings from our transformation efforts and the realization of synergies. The net impact from our tariff assumptions factored into our adjusted gross profit margin is estimated to be an unfavorable impact of approximately 50 basis points largely reflected in the US retail coffee segment. SDA expenses are projected to increase by approximately 3%, primarily reflecting increased marketing investments in the Café Bustelo and Uncrustables brands. Total marketing expense is estimated to be 5.7% of net sales, an increase of 30 basis points or approximately $40 million versus the prior year. We anticipate net interest expense of approximately $380 million driven by continued debt paydown. Our adjusted effective income tax rate is anticipated to be 23.7% along with a full year weighted average share count of 106.7 million.

Bustillo: The net impact from our tariff assumptions factored into our adjusted gross profit margin is estimated to be an unfavorable impact of approximately 50 basis points largely reflected in the U S retail coffee segment.

Tucker Marshall: The net impact from our tariff assumptions factored into our adjusted gross profit margin is estimated to be an unfavorable impact of approximately 50 basis points, largely reflected in the U.S. retail coffee sector. SDNA expenses are projected to increase by approximately 3%, primarily reflecting increased marketing investments in the Café Bustelo and Uncrustables brands. Total marketing expense is estimated to be 5.7% of net sales, an increase of 30 basis points or approximately $40 million versus the prior year. We anticipate net interest expense of approximately $380 million, driven by continued debt paydowns. Our adjusted effective income tax rate is anticipated to be 23.7%, along with a full-year weighted average share count of $106.7 million.

Bustillo: SG&A expenses are projected to increase by approximately 3%, primarily reflecting increased marketing investments and the cafe bustillo and across the walls brands.

Bustillo: Total marketing expense is estimated to be five 7% of net sales an increase of 30 basis points or approximately $40 million versus the prior year.

Bustillo: We anticipate net interest expense of approximately $380 million driven by continued debt paydown.

Bustillo: Our adjusted effective income tax rate is anticipated to be 23, 7% along with a full year weighted average share count of $106 7 million.

Bustillo: Taking all these factors into consideration we.

Tucker Marshall: taking all these factors into consideration.

Tucker Marshall: Taking all these factors into consideration, we anticipate full year adjusted earnings per share to be in the range of $8.50 to $9.50. This wide guidance range includes the following unfavorable impacts, $0.80 from the net impact of our elasticity of demand assumptions in the US retail coffee segment, a $0.30 impact from increased marketing investments, a $0.25 net impact from tariffs, and $0.20 from a decline in profitability within sweet baked snacks segment excluding divestiture impacts. These headwinds more than offset the favorable tailwinds benefiting the business including base business momentum, cost and productivity benefits from our Transformation Office, $100 million in total run rate synergies from the Hostess acquisition by the end of the fiscal year, benefits from mitigating the majority of stranded overhead, and continued debt paydown of approximately $500 million.

Taking all these factors into consideration, we anticipate full year adjusted earnings per share to be in the range of $8.50 to $9.50. This wide guidance range includes the following unfavorable impacts, $0.80 from the net impact of our elasticity of demand assumptions in the US retail coffee segment, a $0.30 impact from increased marketing investments, a $0.25 net impact from tariffs, and $0.20 from a decline in profitability within sweet baked snacks segment excluding divestiture impacts. These headwinds more than offset the favorable tailwinds benefiting the business including base business momentum, cost and productivity benefits from our Transformation Office, $100 million in total run rate synergies from the Hostess acquisition by the end of the fiscal year, benefits from mitigating the majority of stranded overhead, and continued debt paydown of approximately $500 million.

Bustillo: We anticipate full year adjusted earnings per share to be in the range of $8 50.

Tucker Marshall: We anticipate full year adjusted earnings per share to be in the range of $8.50 to $9.50. This wide guidance range includes the following unfavorable impacts. 80 cents from the net impact of our elasticity of demand assumptions in the U.S. retail coffee segment. a 30 cent impact from increased marketing investments a $0.25 net impact from tariffs. and 20 cents from a decline in profitability within sweet baked snacks segment excluding divestiture impact. These headwinds more than offset the favorable tailwinds benefiting the business including base business momentum. Cost and productivity benefits from our transformation office, $100 million in total run rate synergies from the hostess acquisition by the end of the fiscal year.

Bustillo: To $9 50.

Bustillo: This wide guidance range includes the following unfavorable impacts.

Bustillo: 80 cents from the net impact of our elasticity of demand assumptions in the U S retail coffee segment.

Bustillo: A 30 cent impact from increased marketing investments.

Bustillo: Twenty-five net impact from tariffs.

Bustillo: And 20 cents from a decline in profitability within sweet baked snacks segment, excluding divestiture impacts.

Bustillo: These headwinds more than offset the favorable tailwind benefiting the business, including base business momentum.

Bustillo: Cost and productivity benefits from our transformation office.

Bustillo: $100 million in total run rate synergies from the hostess acquisition by the end of the fiscal year.

Bustillo: Benefits for mitigating the majority of stranded overhead and continued debt paydown of approximately $500 million.

Tucker Marshall: Benefits for Mitigating the Majority of Stranded Overhead and Continued Debt Paydown of Approximately $500 Million We project free cash flow of approximately $875 million at the midpoint of our Adjust Our Earnings Per Share guidance range. with capital expenditures of $325 million for the year. Other key assumptions affecting cash flow include depreciation expense of approximately $350 million. amortization expense of approximately 200 million dollars. Share base compensation expense of $35 million and other non-cash charges of $110 million.

Bustillo: We project free cash flow of approximately $875 million at the midpoint of our adjusted earnings per share guidance range with.

Tucker Marshall: We project free cash flow of approximately $875 million at the midpoint of our adjusted earnings per share guidance range, with capital expenditures of $325 million for the year. Other key assumptions affecting cash flow include depreciation expense of approximately $350 million, amortization expense of approximately $200 million, share-based compensation expense of $35 million, and other non-cash charges of $110 million. In Q1 of the fiscal year, net sales are anticipated to decline low single digits, which incorporates an impact of $53 million related to the divested Boardman business, certain sweet baked snacks value brands. Comparable net sales are anticipated to be flat, reflecting a mid single digit increase in net price realization offset by unfavorable volume mix. Net sales also reflect a decline of $10 million of contract manufacturing sales related to the divested pet food brands.

We project free cash flow of approximately $875 million at the midpoint of our adjusted earnings per share guidance range, with capital expenditures of $325 million for the year. Other key assumptions affecting cash flow include depreciation expense of approximately $350 million, amortization expense of approximately $200 million, share-based compensation expense of $35 million, and other non-cash charges of $110 million. In Q1 of the fiscal year, net sales are anticipated to decline low single digits, which incorporates an impact of $53 million related to the divested Boardman business, certain sweet baked snacks value brands. Comparable net sales are anticipated to be flat, reflecting a mid single digit increase in net price realization offset by unfavorable volume mix. Net sales also reflect a decline of $10 million of contract manufacturing sales related to the divested pet food brands.

Bustillo: With capital expenditures of $325 million for the year.

Bustillo: Other key assumptions affecting cash flow include depreciation expense of approximately $350 million.

Bustillo: Amortization expense of approximately $200 million.

Bustillo: Share based compensation expense of $35 million and other noncash charges of $110 million.

Bustillo: In the first quarter of the fiscal year net sales are anticipated to decline low single digits, which incorporates an impact of $53 million related to the divested bornemann business and certain sweet baked snacks value brands.

Tucker Marshall: In the first quarter of the fiscal year, net sales are anticipated to decline low single digits, which incorporates an impact of $53 million related to the divested Bortman business and certain Sweetbake Snacks value brands. Comparable net sales are anticipated to be flat, reflecting a mid-single-digit increase in net price realization offset by unfavorable volume mix. Net sales also reflects a decline of $10 million of contract manufacturing sales related to the divested pet food brand. Adjusted earnings per share are expected to decline approximately 25%, primarily driven by a decrease in adjusted gross profit in our U.S. retail coffee and sweetbake snack segment.

Bustillo: Comparable net sales are anticipated to be flat, reflecting a mid single digit increase in net price realization offset by unfavorable volume mix.

Bustillo: Net sales also reflects a decline of $10 million of contract manufacturing sales related to the divested pet food brands.

Bustillo: Adjusted earnings per share are expected to decline approximately 25% primarily driven by a decrease in adjusted gross profit in our U S retail coffee and sweet baked snack segments.

Tucker Marshall: Adjusted earnings per share are expected to decline approximately 25%, primarily driven by a decrease in adjusted gross profit in our US Retail Coffee and Sweet Baked Snacks segments. We anticipate adjusted earnings per share will improve sequentially throughout the fiscal year. Overall, in Fiscal Year 2026 we are committed to maintaining a disciplined and responsible financial approach while strategically investing in our key platforms and executing on our strategic priorities, and to deliver long-term growth and increase shareholder value. This includes Fiscal Year 2027, which we anticipate will be an inflection year for adjusted earnings per share growth absent any significant changes in the Green Coffee market and consumer or regulatory environment inclusive of trade policy. In closing, I would like to thank our employees. They have demonstrated their commitment to executing with excellence, and their passion for our company positions us for continued success. Thank you.

Adjusted earnings per share are expected to decline approximately 25%, primarily driven by a decrease in adjusted gross profit in our US Retail Coffee and Sweet Baked Snacks segments. We anticipate adjusted earnings per share will improve sequentially throughout the fiscal year. Overall, in Fiscal Year 2026 we are committed to maintaining a disciplined and responsible financial approach while strategically investing in our key platforms and executing on our strategic priorities, and to deliver long-term growth and increase shareholder value. This includes Fiscal Year 2027, which we anticipate will be an inflection year for adjusted earnings per share growth absent any significant changes in the Green Coffee market and consumer or regulatory environment inclusive of trade policy. In closing, I would like to thank our employees. They have demonstrated their commitment to executing with excellence, and their passion for our company positions us for continued success. Thank you.

Bustillo: We anticipate adjusted earnings per share will improve sequentially throughout the fiscal year.

Tucker Marshall: We anticipate adjusted earnings per share will improve sequentially throughout the fiscal year.

Bustillo: Overall in fiscal year 2026, we are committed to maintaining a disciplined and responsible financial approach, while strategically investing in our key platforms and executing on our strategic priorities to deliver long term growth and increase shareholder value.

Tucker Marshall: Overall, in fiscal year 2026, we are committed to maintaining a disciplined and responsible financial approach while strategically investing in our key platforms and executing on our strategic priorities to deliver long-term growth and increase shareholder value. This includes fiscal year 2027, which we anticipate will be an algorithm year for adjusted earnings per share growth, absent any significant changes in the green coffee market and consumer or regulatory environment, inclusive of trade policy.

Bustillo: This includes fiscal year, 2027, which we anticipate will be an algorithm here for adjusted earnings per share growth.

Bustillo: Absent any significant changes in the green coffee market and consumer or regulatory environment inclusive of trade policy.

Bustillo: In closing I would like to thank our employees they have demonstrated their commitment to executing with excellence and their passion for our company positions us for continued success.

Tucker Marshall: In closing, I would like to thank our employees. They have demonstrated their commitment to executing with excellence, and their passion for our company positions us for continued success. Thank you.

Bustillo: <unk>.

Q4 2025 J M Smucker Co Earnings Call - Pre-Recorded

Request a DemoDemo

SJM

J.M. Smucker

Earnings