Marzetti Q2 2026 The Marzetti Co Earnings Call | AllMind AI Earnings | AllMind AI
Q2 2026 The Marzetti Co Earnings Call
The Marzetti company's fiscal year, 2026 second quarter conference call.
Operator: The Marzetti Company’s Fiscal Year 2026, Q2 conference call. Conducting today’s call will be Dave Ciesinski, President and CEO, and Tom Pigott, CFO. All lines have been placed on mute to prevent any background noise. After the speakers have completed their prepared remarks, there will be a question-and-answer period. If you would like to ask a question during this time, simply press star one one on your telephone keypad. If you would like to withdraw your question, please press star one one again. And now, to begin the conference call, here is Dale Ganobsik, Vice President of Corporate Finance and Investor Relations for The Marzetti Company.
Operator: The Marzetti Company’s Fiscal Year 2026, Second Quarter Conference Call. Conducting today’s call will be Dave Ciesinski, President and CEO, and Tom Pigott, CFO. All lines have been placed on mute to prevent any background noise. After the speakers have completed their prepared remarks, there will be a question-and-answer period. If you would like to ask a question during this time, simply press star one one on your telephone keypad. If you would like to withdraw your question, please press star one one again. And now, to begin the conference call, here is Dale Ganobsik, Vice President of Corporate Finance and Investor Relations for The Marzetti Company.
Conducting today's call will be Dave Sinskey president and CEO and Tom pigot CFO. All lines have been placed on mute to prevent any background noise. After the speakers have completed their prepared remarks, there will be a question and answer period. If you would like to ask a question during this time, simply press star 1 1 on your telephone keypad, if you would like to withdraw your question, please press star 1 1 again and now to begin the conference call here is Dale synopsis vice president of corporate finance and investor relations for the Marzetti company.
Dale Ganobsik: Good morning, everyone, and thank you for joining us today for The Marzetti Company's Fiscal Year 2026 Q2 conference call. Our discussion this morning may include forward-looking statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are subject to a number of risks and uncertainties that could cause actual results to differ materially, and the Company undertakes no obligation to update these statements based upon subsequent events. A detailed discussion of these risks and uncertainties is contained in the Company's filings with the SEC. Also note that the audio replay of this call will be archived and available on our website, investors.marzetticompany.com, later today. For today's call, Dave Ciesinski, our President and CEO, will begin with a business update and highlights for the quarter.
Dale Ganobsik: Good morning, everyone, and thank you for joining us today for The Marzetti Company's Fiscal Year 2026 Q2 conference call. Our discussion this morning may include forward-looking statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are subject to a number of risks and uncertainties that could cause actual results to differ materially, and the Company undertakes no obligation to update these statements based upon subsequent events. A detailed discussion of these risks and uncertainties is contained in the Company's filings with the SEC. Also note that the audio replay of this call will be archived and available on our website, investors.marzetticompany.com, later today. For today's call, Dave Ciesinski, our President and CEO, will begin with a business update and highlights for the quarter.
Good morning everyone and thank you for joining us today. For the Marzetti company's fiscal year, 2026 second quarter conference call
Our discussion this morning may include forward-looking statements which are subject to the safe harbor, provisions of the private Securities. Litigation Reform, Act of 1995.
These statements are subject to a number of risks and uncertainties that could cause actual results to differ materially and the company undertakes. No obligation to update these statements based on subsequent events,
A detailed discussion of these risks. I know certain needs is contained in the company's filings with the SEC.
Also note, that the audio replay of this call will be archived and available on our website investors Marzetti company.com later today.
For today's call Da zinsky, our president and CEO will begin with the business update, and highlights for the quarter.
Tom pigot, our CFO will then provide an overview of the financial results.
Dale Ganobsik: Tom Pigott, our CFO, will then provide an overview of the financial results. Dave will then share some comments regarding our current strategy and outlook. At the conclusion of our prepared remarks, we'll be happy to respond to any of your questions. Once again, we appreciate your participation this morning. I'll now turn the call over to The Marzetti Company's President and CEO, Dave Ciesinski. Dave?
Dale Ganobsik: Tom Pigott, our CFO, will then provide an overview of the financial results. Dave will then share some comments regarding our current strategy and outlook. At the conclusion of our prepared remarks, we'll be happy to respond to any of your questions. Once again, we appreciate your participation this morning. I'll now turn the call over to The Marzetti Company's President and CEO, Dave Ciesinski. Dave?
Dave will then share some comments regarding our current strategy and Outlook.
At the conclusion of our prepared remarks, we'll be happy to respond to any of your questions.
Once again, we appreciate your participation this morning, I'll now turn the call over to the Marzetti company's president and CEO, Dave, Dave.
David Ciesinski: Thanks, Dale, and good morning, everyone. It's a big day here for The Marzetti Company because in addition to reporting our Q2 results for fiscal year 2026, we are thrilled to announce that The Marzetti Company has entered into a definitive agreement to acquire Bachan’s, the authentic, great-tasting, and rapidly growing Japanese-American barbecue sauce brand. I will have more details to share on the acquisition later in the call, following the review of our second quarter results. In our fiscal second quarter, which ended December 31, consolidated net sales increased 1.7% to $518 million. Excluding non-core sales attributed to a temporary supply agreement, or TSA, adjusted net sales increased 0.1% to $510 million. Gross profit grew 3.4% to a second quarter record $137 million.
David Ciesinski: Thanks, Dale, and good morning, everyone. It's a big day here for The Marzetti Company because in addition to reporting our Q2 results for fiscal year 2026, we are thrilled to announce that The Marzetti Company has entered into a definitive agreement to acquire Bachan’s, the authentic, great-tasting, and rapidly growing Japanese-American barbecue sauce brand. I will have more details to share on the acquisition later in the call, following the review of our second quarter results. In our fiscal second quarter, which ended December 31, consolidated net sales increased 1.7% to $518 million. Excluding non-core sales attributed to a temporary supply agreement, or TSA, adjusted net sales increased 0.1% to $510 million. Gross profit grew 3.4% to a second quarter record $137 million.
Thanks Dale, and good morning, everyone. It's a big day here for the Marzetti company because in addition to reporting our Q2 results for fiscal year 2026, we are thrilled to announce that the Marzetti company has entered into a definitive agreement to acquire Bosch on the authentic, great tasting and rapidly growing, Japanese American barbecue sauce, brand
I will have more details to share on the acquisition later in the call following the review of our second quarter results.
in our fiscal second quarter which ended December 31st Consolidated, net sales increased 1.7% to 518 million
Excluding non-core sales attributed to a temporary Supply agreement or TSA adjusted, net sales, increase 1 tenth of 1% to 510 million.
Growth profit. Growth 3.4% to a second quarter record, 137 million.
David Ciesinski: In our retail segment, the 1.1% decline in net sales compares to a strong prior year quarter of 6.3% and reflects softer demand during the timeframe of the US government shutdown. Retail segment sales highlights include continued growth from our category-leading New York Bakery frozen garlic bread products and expanding distribution for our Texas Roadhouse dinner rolls. Circana scanner data for the quarter ending December 31 showed solid performance for several of our core brands and licensed items, with overall scanned sales up 2.3% for the 13-week period. In the frozen garlic bread category, our New York Bakery brand grew sales 8.4%, adding 300 basis points of market share for a category-leading 44.6%.
David Ciesinski: In our retail segment, the 1.1% decline in net sales compares to a strong prior year quarter of 6.3% and reflects softer demand during the timeframe of the US government shutdown. Retail segment sales highlights include continued growth from our category-leading New York Bakery frozen garlic bread products and expanding distribution for our Texas Roadhouse dinner rolls. Circana scanner data for the quarter ending December 31 showed solid performance for several of our core brands and licensed items, with overall scanned sales up 2.3% for the 13-week period. In the frozen garlic bread category, our New York Bakery brand grew sales 8.4%, adding 300 basis points of market share for a category-leading 44.6%.
In our retail segment, the 1.1% decline in net sales compares to a strong prior year quarter of 6.3%, and reflects softer, demand, during the time frame of the US government shutdown.
Retail, segment sales highlights include continued growth from our category leading New York bakery, frozen garlic, bread products, and expanding distribution for our Texas Roadhouse general rules.
So kind of scanner data for the quarter ending December 31st, showed solid performance for several of our core Brands and licensed items with overall scanned sales of 2.3% for the 13w week, period.
In the frozen garlic, bread category, our New York, bakery brand grew sales 8.4% adding 300 basis points of market, share for a category leading 44.6%.
David Ciesinski: In the frozen dinner roll category, our Sister Schubert’s brand and our licensed Texas Roadhouse brand combined to grow 7.1%, resulting in a market share increase of 40 basis points to a category-leading 60.8%. In the shelf-stable sauces and condiments category, sales of our licensed Chick-fil-A sauces grew 6.7%, resulting in 13 basis points of share growth. Chick-fil-A sauces benefited from expanded distribution into the club channel that began during our fiscal Q4, which ended 30 June. In the produce dips category, sales of our Marzetti brand increased 0.3%, adding 130 basis points of market share for a category-leading 75.5%. In the food service segment, excluding the non-core TSA sales, adjusted net sales grew 1.6%, while volume measured in pounds shipped declined 0.4%.
David Ciesinski: In the frozen dinner roll category, our Sister Schubert’s brand and our licensed Texas Roadhouse brand combined to grow 7.1%, resulting in a market share increase of 40 basis points to a category-leading 60.8%. In the shelf-stable sauces and condiments category, sales of our licensed Chick-fil-A sauces grew 6.7%, resulting in 13 basis points of share growth. Chick-fil-A sauces benefited from expanded distribution into the club channel that began during our fiscal Q4, which ended 30 June. In the produce dips category, sales of our Marzetti brand increased 0.3%, adding 130 basis points of market share for a category-leading 75.5%. In the food service segment, excluding the non-core TSA sales, adjusted net sales grew 1.6%, while volume measured in pounds shipped declined 0.4%.
In the pros. And general category, our sister scheuber brand and our licensed, Texas Roadhouse brand combined to grow 7.1% resulting in a market share, increase of 40 basis points to a category, leading 60.8%.
In the Shelf, stable sauces and condiments categories sales of our licensed, Chick-fil-A, sauces, grew 6.7%, resulting in 13 basis, points of share growth.
Chick-fil-A sauce has benefited from expanded distribution into the club channel that began during our fiscal fourth quarter, which ended June 30th.
In the Food Service segment. Excluding the non-core TSA sales adjusted. Net sales grew 1.6% while volume measured in pound shipped declined. 4/10 of 1%.
David Ciesinski: In addition to the benefits of inflationary pricing, the increase in food service segment sales reflects increased demand for several of our core national account customers and higher sales for branded food service products. During the period, we are pleased to report a 3.4% increase in gross profit to a Q2 record of $137 million, with reported gross margin up 40 basis points. Our focus on supply chain productivity, value engineering, and revenue management all remain core elements to further improve our margins and financial performance. I'll now turn the call over to Tom Pigott, our CFO, for his commentary on our Q2 results. Tom?
David Ciesinski: In addition to the benefits of inflationary pricing, the increase in food service segment sales reflects increased demand for several of our core national account customers and higher sales for branded food service products. During the period, we are pleased to report a 3.4% increase in gross profit to a Q2 record of $137 million, with reported gross margin up 40 basis points. Our focus on supply chain productivity, value engineering, and revenue management all remain core elements to further improve our margins and financial performance. I'll now turn the call over to Tom Pigott, our CFO, for his commentary on our Q2 results. Tom?
In addition, to the benefits of inflationary pricing, the increase in food service, segment sales reflects increased demand for several of our core national account customers and higher sales for Branded Food Service products.
During the period, we are pleased to report a 3.4% increase in gross profit to a second quarter record of 137 million, with reported gross margin of 40 basis points.
Our focus on supply chain, productivity value, engineering, and revenue management. All remain core elements. To further improve our margins and financial performance.
I'll now turn the call over to Tom pigot our CFO for his commentary on our second quarter results. Tom
Thanks Dave.
Dale Ganobsik: Thanks, Dave. Overall, the company delivered improved performance against a strong comparative period. In addition, investments were made to support future growth.
Thomas Pigott: Thanks, Dave. Overall, the company delivered improved performance against a strong comparative period. In addition, investments were made to support future growth.
Overall, the company delivered, improved performance against a strong comparative period.
In addition Investments were made to support future growth.
Thomas Pigott: ... Second quarter consolidated net sales increased by 1.7% to $518 million. Breaking down the revenue performance, net pricing was accretive by approximately 140 basis points. Core volume and product mix drove a 130 basis point decline. In addition, the company reported $8.2 million in sales, or 160 basis points of growth, that resulted from a temporary supply agreement with Winland Foods, the seller of the Atlanta-based manufacturing facility that we acquired last year. We entered into this agreement to facilitate the closing of the transaction. It's important to note that these temporary and non-core sales are expected to conclude during the quarter ended 31 March 2026.
Thomas Pigott: ... Second quarter consolidated net sales increased by 1.7% to $518 million. Breaking down the revenue performance, net pricing was accretive by approximately 140 basis points. Core volume and product mix drove a 130 basis point decline. In addition, the company reported $8.2 million in sales, or 160 basis points of growth, that resulted from a temporary supply agreement with Winland Foods, the seller of the Atlanta-based manufacturing facility that we acquired last year. We entered into this agreement to facilitate the closing of the transaction. It's important to note that these temporary and non-core sales are expected to conclude during the quarter ended 31 March 2026.
Second quarter, consulted, net sales increased by 1.7% to 518 million.
Breaking down the revenue performance. Net pricing was accreted by approximately 140 basis points.
Core volume and product, mix drove, 130 basis, point decline.
In addition, the company reported 8.2 million in sales for 160 basis points of growth that resulted from a temporary Supply agreement with winland Foods, the seller of the Atlanta based manufacturing facility that we acquired last year.
We entered into this agreement to facilitate the closing of the transaction.
David A. Ciesinski: We are pleased to report a 3.4% increase in gross profit to a Q2 record of $137 million, with reported gross margin up 40 basis points. Our focus on supply chain productivity, value engineering, and revenue management all remain core elements to further improve our margins and financial performance. I'll now turn the call over to Tom Pigott, our CFO, for his commentary on our Q2 results. Tom?
Dave Ciesinski: We are pleased to report a 3.4% increase in gross profit to a Q2 record of $137 million, with reported gross margin up 40 basis points. Our focus on supply chain productivity, value engineering, and revenue management all remain core elements to further improve our margins and financial performance. I'll now turn the call over to Tom Pigott, our CFO, for his commentary on our Q2 results. Tom?
It's important to note that these temporary and non-core sales are expected to include during the quarter ended March 31st 2026.
Thomas Pigott: Consolidated gross profit increased by $4.5 million, or 3.4%, versus the prior year quarter to $137.3 million, and reported gross margin expanded by 40 basis points. The gross profit growth was driven by our productivity program, where we benefited from cost savings across a number of areas, including procurement, manufacturing, value engineering, and distribution. In addition, our pricing actions offset the higher commodity costs we experienced during the quarter. Note that excluding the $8.2 million in sales from the temporary supply agreement, which did not contribute meaningfully to gross profit, adjusted gross margin expanded by 80 basis points. Selling general and administrative expenses grew by $3.3 million, or 5.8%.
Thomas Pigott: Consolidated gross profit increased by $4.5 million, or 3.4%, versus the prior year quarter to $137.3 million, and reported gross margin expanded by 40 basis points. The gross profit growth was driven by our productivity program, where we benefited from cost savings across a number of areas, including procurement, manufacturing, value engineering, and distribution. In addition, our pricing actions offset the higher commodity costs we experienced during the quarter. Note that excluding the $8.2 million in sales from the temporary supply agreement, which did not contribute meaningfully to gross profit, adjusted gross margin expanded by 80 basis points. Selling general and administrative expenses grew by $3.3 million, or 5.8%.
Consolidated gross profit increased by 4.5 million, or 3.4% versus a prior year quarter to 137.3 million and reported gross margin expanded by 40 basis points.
Thomas Pigott: Thanks, Dave. Overall, the company delivered improved performance against a strong comparative period. In addition, investments were made to support future growth. Q2 consolidated net sales increased by 1.7% to $518 million. Breaking down the revenue performance, net pricing was accretive by approximately 140 basis points. Core volume and product mix drove a 130 basis point decline. In addition, the company reported $8.2 million in sales, or 160 basis points of growth, that resulted from a temporary supply agreement with Winland Foods, the seller of the Atlanta-based manufacturing facility that we acquired last year. We entered into this agreement to facilitate the closing of the transaction. It's important to note that these temporary and non-core sales are expected to conclude during the quarter ending 31 March 2026.
Tom Pigott: Thanks, Dave. Overall, the company delivered improved performance against a strong comparative period. In addition, investments were made to support future growth. Q2 consolidated net sales increased by 1.7% to $518 million. Breaking down the revenue performance, net pricing was accretive by approximately 140 basis points. Core volume and product mix drove a 130 basis point decline. In addition, the company reported $8.2 million in sales, or 160 basis points of growth, that resulted from a temporary supply agreement with Winland Foods, the seller of the Atlanta-based manufacturing facility that we acquired last year. We entered into this agreement to facilitate the closing of the transaction. It's important to note that these temporary and non-core sales are expected to conclude during the quarter ending 31 March 2026.
The gross profit growth was driven by our productivity program where we benefited from cost savings across a number of areas, including procurement manufacturing, value, engineering and distribution.
in addition, our pricing actions offset the higher commodity costs, we experienced during the quarter,
Note that excluding the 8.2 million in sales from the temporary Supply agreement, which did not contribute meaningfully to gross profits. Adjusted gross margin expanded by 80 basis points.
Core volume and product, mix drove, 130 basis, point decline.
Selling General and administrative expenses grew by 3.3 million or 5.8%.
Thomas Pigott: The increase was primarily driven by a higher marketing spend as we invested to support the continued growth of our retail brands and the expanded launch of Texas Roadhouse Rolls. Note that last year, SG&A expenses included acquisition-related costs of $1.6 million. During the quarter, the company recorded $1.7 million in restructuring and impairment charges. The charges are attributed to a non-cash impairment charge on manufacturing equipment in our food service segment, as well as the planned closure of our sauce and dressing facility in Milpitas, California, that we previously announced. Consolidated reported operating income decreased by $500 thousand. The gross profit growth was offset by the higher investments we made in SG&A and the restructuring impairment costs. Excluding the restructuring impairment charges and the acquisition-related costs recorded in the prior year, adjusted operating income declined by $400 thousand.
Thomas Pigott: The increase was primarily driven by a higher marketing spend as we invested to support the continued growth of our retail brands and the expanded launch of Texas Roadhouse Rolls. Note that last year, SG&A expenses included acquisition-related costs of $1.6 million. During the quarter, the company recorded $1.7 million in restructuring and impairment charges. The charges are attributed to a non-cash impairment charge on manufacturing equipment in our food service segment, as well as the planned closure of our sauce and dressing facility in Milpitas, California, that we previously announced. Consolidated reported operating income decreased by $500 thousand. The gross profit growth was offset by the higher investments we made in SG&A and the restructuring impairment costs. Excluding the restructuring impairment charges and the acquisition-related costs recorded in the prior year, adjusted operating income declined by $400 thousand.
The increase was primarily driven by higher a higher marketing spend as we invested to support the continued growth of our retail brands in the expanded launch of Texas Roadhouse rolls.
In addition the company reported 8.2 million dollars in sales for 160 basis points of growth that resulted from a temporary Supply agreement. With winland Foods, the seller of the Atlanta based manufacturing facility that we acquired last year.
Note that last year sgna, expenses included acquisition related costs of 1.6 million.
We entered into this agreement to facilitate the closing of the transaction.
During the quarter, the company recorded 1.7 million dollars in restructuring and impairment charges.
It's important to note that these temporary and non-core sales are expected to conclude during the quarter ended March 31, 2026.
Thomas Pigott: Consolidated gross profit increased by $4.5 million, or 3.4%, versus the prior year quarter to $137.3 million, and reported gross margin expanded by 40 basis points. The gross profit growth was driven by our productivity program, where we benefited from cost savings across a number of areas, including procurement, manufacturing, value engineering, and distribution. In addition, our pricing actions offset the higher commodity costs we experienced during the quarter. Note that excluding the $8.2 million in sales from the temporary supply agreement, which did not contribute meaningfully to gross profit, adjusted gross margin expanded by 80 basis points. Selling, general, and administrative expenses grew by $3.3 million, or 5.8%.
Consolidated gross profit increased by $4.5 million, or 3.4%, versus the prior year quarter to $137.3 million, and reported gross margin expanded by 40 basis points. The gross profit growth was driven by our productivity program, where we benefited from cost savings across a number of areas, including procurement, manufacturing, value engineering, and distribution. In addition, our pricing actions offset the higher commodity costs we experienced during the quarter. Note that excluding the $8.2 million in sales from the temporary supply agreement, which did not contribute meaningfully to gross profit, adjusted gross margin expanded by 80 basis points. Selling, general, and administrative expenses grew by $3.3 million, or 5.8%.
The charges are attributed to a non-cash impairment charge.
On manufacturing equipment, in our food service segments, as well as the plan closure of our sauce and dressing facility in mitus, California that we previously announced.
Consolidated gross profit increased by $4.5 million, or 3.4%, versus the prior year quarter to $137.3 million, and reported gross margin expanded by 40 basis points.
Consolidated reported operating income decreased by $100,000. The gross profit growth was offset by the higher Investments. We made in sgna and the restructuring impairment costs.
The gross profit growth was driven by a productivity program where we benefited from cost savings across a number of areas, including procurement, manufacturing, value engineering, and distribution.
in addition, our pricing actions offset the higher commodity costs, we experienced during the quarter,
Excluding the restructuring impairment charges and the acquisition related costs recorded in the prior year, adjusted operating income declined by $100,000.
Thomas Pigott: Our tax rate for the quarter was 22.6% versus 22.5% in the prior-year quarter. We estimate our tax rate for the remainder of the fiscal year 2026 to be 23%. Q2 diluted earnings per share increased $0.37, or 20.8%, to $2.15. Note that in the prior year, we took a pension settlement charge of $0.39, in addition to the acquisition-related costs, which totaled $0.05. In the current-year quarter, the restructuring impairment charges totaled $0.05 per share. With regard to capital expenditures, our payments for property additions totaled $17.7 million for the quarter. For fiscal 2026, we are forecasting total capital expenditures between $75 and 85 million.
Thomas Pigott: Our tax rate for the quarter was 22.6% versus 22.5% in the prior-year quarter. We estimate our tax rate for the remainder of the fiscal year 2026 to be 23%. Q2 diluted earnings per share increased $0.37, or 20.8%, to $2.15. Note that in the prior year, we took a pension settlement charge of $0.39, in addition to the acquisition-related costs, which totaled $0.05. In the current-year quarter, the restructuring impairment charges totaled $0.05 per share. With regard to capital expenditures, our payments for property additions totaled $17.7 million for the quarter. For fiscal 2026, we are forecasting total capital expenditures between $75 and 85 million.
Our tax rate for the quarter was 22.6% versus 22.5% in the prior year quarter.
Note that excluding the 8.2 million in sales from the temporary Supply agreement, which did not contribute meaningfully to gross profit, adjusted gross margin expanded by 80 basis points.
We estimate our tax rate for the remainder of the fiscal year, 26 to be 23%.
Thomas Pigott: The increase was primarily driven by a higher marketing spend as we invested to support the continued growth of our retail brands and the expanded launch of Texas Roadhouse Rolls. Note that last year, SG&A expenses included acquisition-related costs of $1.6 million. During the quarter, the company recorded $1.7 million in restructuring and impairment charges. The charges are attributed to a non-cash impairment charge on manufacturing equipment in our food service segment, as well as the planned closure of our sauce and dressing facility in Milpitas, California, that we previously announced. Consolidated reported operating income decreased by $500 thousand. The gross profit growth was offset by the higher investments we made in SG&A and the restructuring impairment costs. Excluding the restructuring impairment charges and the acquisition-related costs recorded in the prior year, adjusted operating income declined by $400 thousand.
The increase was primarily driven by a higher marketing spend as we invested to support the continued growth of our retail brands and the expanded launch of Texas Roadhouse Rolls. Note that last year, SG&A expenses included acquisition-related costs of $1.6 million. During the quarter, the company recorded $1.7 million in restructuring and impairment charges. The charges are attributed to a non-cash impairment charge on manufacturing equipment in our food service segment, as well as the planned closure of our sauce and dressing facility in Milpitas, California, that we previously announced. Consolidated reported operating income decreased by $500 thousand. The gross profit growth was offset by the higher investments we made in SG&A and the restructuring impairment costs. Excluding the restructuring impairment charges and the acquisition-related costs recorded in the prior year, adjusted operating income declined by $400 thousand.
Selling General and administrative expenses grew by 3.3 million or 5.8%.
Second quarter diluted earnings per share increase 37 cents or 20.8% to 2.15.
The increase was primarily driven by higher marketing spend as we invested to support the continued growth of our retail brands, and the expanded launch of Texas Roadhouse rolls.
Note that in the prior year, we took a pension settlement charge of 39 cents. In addition to the acquisition related costs, which totaled 5 cents.
In the current year quarter, the restructuring impairment charges totaled, 5 cents per share.
Note that last year sgna, expenses included acquisition related costs of 1.6 million.
With regard to Capital expenditures, our payments for property, editions totaled 17.7 million for the quarter.
During the quarter, the company recorded $1.7 million in restructuring and impairment charges.
The charges are attributed to a non-cash impairment charge.
Fiscal 26, we're forecasting total Capital expenditures between 75 and 85 million.
Thomas Pigott: We will continue to invest in both cost savings projects and other manufacturing improvements, as well as the Atlanta facility we acquired last year. In addition to investing in our business, we also returned funds to shareholders. Our quarterly cash dividend of $1 per share, paid on December 31, represented a 5% increase from the prior year's amount. It marked 63 consecutive years of regular cash dividend increases. In addition to the $27.6 million paid in dividends, the company repurchased $20.1 million in common stock in Q2. Our financial position remains strong, with a debt-free balance sheet and over $201 million in cash. As Dave will discuss, we plan to take advantage of that strong position to invest for further growth with the acquisition of Bachan’s.
Thomas Pigott: We will continue to invest in both cost savings projects and other manufacturing improvements, as well as the Atlanta facility we acquired last year. In addition to investing in our business, we also returned funds to shareholders. Our quarterly cash dividend of $1 per share, paid on December 31, represented a 5% increase from the prior year's amount. It marked 63 consecutive years of regular cash dividend increases. In addition to the $27.6 million paid in dividends, the company repurchased $20.1 million in common stock in Q2. Our financial position remains strong, with a debt-free balance sheet and over $201 million in cash. As Dave will discuss, we plan to take advantage of that strong position to invest for further growth with the acquisition of Bachan’s.
We will continue to invest in both cost, savings projects, and other manufacturing improvements as well as the Atlanta facility. We acquired last year.
On manufacturing equipment in our foodservice segments, as well as the planned closure of our sauce and dressing facility in Mitus, California, that we previously announced.
Consolidated reported operating income decreased by 500% growth was offset by the higher Investments. We made in sgna and the restructuring impairment costs.
In addition to investing in our business, we also return funds to shareholders our quarterly cash dividend of $1 per share, paid on December 31st representative 5% increase from the prior Year's amount.
It marked 633 consecutive years of regular cash dividend increases.
Thomas Pigott: Our tax rate for the quarter was 22.6% versus 22.5% in the prior year quarter. We estimate our tax rate for the remainder of the fiscal year 2026 to be 23%. Q2 diluted earnings per share increased $0.37, or 20.8%, to $2.15. Note that in the prior year, we took a pension settlement charge of $0.39, in addition to the acquisition-related costs, which totaled $0.05. In the current year quarter, the restructuring impairment charges totaled $0.05 per share. With regard to capital expenditures, our payments for property additions totaled $17.7 million for the quarter. For fiscal 2026, we are forecasting total capital expenditures between $75 and 85 million.
Our tax rate for the quarter was 22.6% versus 22.5% in the prior year quarter. We estimate our tax rate for the remainder of the fiscal year 2026 to be 23%. Q2 diluted earnings per share increased $0.37, or 20.8%, to $2.15. Note that in the prior year, we took a pension settlement charge of $0.39, in addition to the acquisition-related costs, which totaled $0.05. In the current year quarter, the restructuring impairment charges totaled $0.05 per share. With regard to capital expenditures, our payments for property additions totaled $17.7 million for the quarter. For fiscal 2026, we are forecasting total capital expenditures between $75 and 85 million.
Excluding the restructuring impairment charges and the acquisition-related costs recorded in the prior year, adjusted operating income declined by $400,000.
Our tax rate for the quarter was 22.6% versus 22.5% in the prior year quarter.
In addition to the 27.6 million paid in dividends the company, repurchased, 20.1 million in common stock in the second quarter.
We estimate our tax rate for the remainder of the fiscal year, 26 to be 23%.
Our financial position remains strong with the debt-free balance sheet and over 2011 million in cash.
Second-quarter diluted earnings per share increased $0.37, or 20.8%, to $2.15.
And is able to discuss we plan to take advantage of that strong position to invest for further growth with the acquisition of bosons.
We will continue to have a strong balance sheet following the acquisition.
Thomas Pigott: We will continue to have a strong balance sheet following the acquisition. As we complete the first half of the year, we're pleased to report growth in net sales of 3.6% and adjusted net sales of 1.7%. Reported and adjusted gross margin reflected increases of 30 and 80 basis points, respectively. Reported operating income was up 2.2%, while adjusted operating income increased 3.1%. In addition, operating cash flow grew by $30.6 million, or 24%. To wrap up my commentary, our results demonstrate strong execution across a number of areas that drove solid top and bottom line performance in a difficult operating environment. In addition, we returned funds to shareholders through our increased dividend and share repurchase, and also continued to make investments to support further growth and cost savings.
Thomas Pigott: We will continue to have a strong balance sheet following the acquisition. As we complete the first half of the year, we're pleased to report growth in net sales of 3.6% and adjusted net sales of 1.7%. Reported and adjusted gross margin reflected increases of 30 and 80 basis points, respectively. Reported operating income was up 2.2%, while adjusted operating income increased 3.1%. In addition, operating cash flow grew by $30.6 million, or 24%. To wrap up my commentary, our results demonstrate strong execution across a number of areas that drove solid top and bottom line performance in a difficult operating environment. In addition, we returned funds to shareholders through our increased dividend and share repurchase, and also continued to make investments to support further growth and cost savings.
Note that in the prior year, we took a pension settlement charge of $0.39. In addition to the acquisition-related costs, which totaled $0.05.
In the current year quarter, the restructuring impairment charges totaled, 5 cents per share.
As we complete the first half of the Year, we're pleased to report growth in net sales of 3.6% and adjusted. Net sales of 1.7% reported in adjusted gross margin, reflected increases of 30 and 80 basis points respectively.
With regard to capital expenditures, our payments for property additions totaled $17.7 million for the quarter.
Reported operating income was up 2.2% while adjusted operating income increased 3.1%.
Thomas Pigott: We will continue to invest in both cost savings projects and other manufacturing improvements, as well as the Atlanta facility we acquired last year. In addition to investing in our business, we also returned funds to shareholders. Our quarterly cash dividend of $1 per share, paid on December 31, represented a 5% increase from the prior year's amount. It marked 63 consecutive years of regular cash dividend increases. In addition to the $27.6 million paid in dividends, the company repurchased $20.1 million in common stock in Q2. Our financial position remains strong, with a debt-free balance sheet and over $201 million in cash. As Dave will discuss, we plan to take advantage of that strong position to invest for further growth with the acquisition of Bachan's.
We will continue to invest in both cost savings projects and other manufacturing improvements, as well as the Atlanta facility we acquired last year. In addition to investing in our business, we also returned funds to shareholders. Our quarterly cash dividend of $1 per share, paid on December 31, represented a 5% increase from the prior year's amount. It marked 63 consecutive years of regular cash dividend increases. In addition to the $27.6 million paid in dividends, the company repurchased $20.1 million in common stock in Q2. Our financial position remains strong, with a debt-free balance sheet and over $201 million in cash. As Dave will discuss, we plan to take advantage of that strong position to invest for further growth with the acquisition of Bachan's.
For fiscal '26, we're forecasting total capital expenditures between $75 and $85 million.
In addition, operating cash flow, grew by 30.6 million or 24%.
We will continue to invest in both cost savings projects and other manufacturing improvements, as well as the Atlanta facility we acquired last year.
To wrap up my commentary, our results demonstrate strong execution across a number of areas that drove solid top and bottom line performance in a difficult operating environment.
From the prior Year's mouth.
In addition, we return funds to shareholders through our increase dividends and share our purchases.
And also continue to make investments to support further growth in cost savings.
It marked 63 consecutive years of regular cash dividend increases.
I'll now turn it back over to Dave for his closing remarks. Thank you.
Thomas Pigott: I'll now turn it back over to Dave for his closing remarks. Thank you.
Thomas Pigott: I'll now turn it back over to Dave for his closing remarks. Thank you.
David Ciesinski: Thanks, Tom. As we look ahead, the Marzetti Company will continue to leverage the combined strength of our team, our operating strategy, and our balance sheet in support of the three simple pillars of our growth plan. To one, accelerate core business growth... Two, to simplify our supply chain to reduce our costs and grow our margins. And three, to expand our core with focused M&A and strategic licensing. As an example of how we're executing against that third pillar, this morning, we announced that the Marzetti Company had entered into a definitive agreement to acquire Bachan’s, the authentic, great-tasting, and rapidly growing Japanese-American barbecues brand. Bachan’s has been built around a multi-generational family recipe, passed down to its founder, Justin Gill, who has done an amazing job of developing the products and building this brand. We are extremely excited to add Bachan’s to our portfolio.
David Ciesinski: Thanks, Tom. As we look ahead, the Marzetti Company will continue to leverage the combined strength of our team, our operating strategy, and our balance sheet in support of the three simple pillars of our growth plan. To one, accelerate core business growth... Two, to simplify our supply chain to reduce our costs and grow our margins. And three, to expand our core with focused M&A and strategic licensing. As an example of how we're executing against that third pillar, this morning, we announced that the Marzetti Company had entered into a definitive agreement to acquire Bachan’s, the authentic, great-tasting, and rapidly growing Japanese-American barbecues brand. Bachan’s has been built around a multi-generational family recipe, passed down to its founder, Justin Gill, who has done an amazing job of developing the products and building this brand. We are extremely excited to add Bachan’s to our portfolio.
In addition to the 27.6 million paid in dividends the company, repurchased, 20.1 million dollars in common stock in the second quarter.
Our financial position remains strong, with a debt-free balance sheet and over $201.9 million in cash.
Thomas Pigott: We will continue to have a strong balance sheet following the acquisition. As we complete the first half of the year, we're pleased to report growth in net sales of 3.6% and adjusted net sales of 1.7%. Reported and adjusted gross margin reflected increases of 30 and 80 basis points, respectively. Reported operating income was up 2.2%, while adjusted operating income increased 3.1%. In addition, operating cash flow grew by $30.6 million, or 24%.... To wrap up my commentary, our results demonstrate strong execution across a number of areas that drove solid top and bottom line performance in a difficult operating environment. In addition, we returned funds to shareholders through our increased dividend and share repurchases, and also continued to make investments to support further growth and cost savings.
We will continue to have a strong balance sheet following the acquisition. As we complete the first half of the year, we're pleased to report growth in net sales of 3.6% and adjusted net sales of 1.7%. Reported and adjusted gross margin reflected increases of 30 and 80 basis points, respectively. Reported operating income was up 2.2%, while adjusted operating income increased 3.1%. In addition, operating cash flow grew by $30.6 million, or 24%.... To wrap up my commentary, our results demonstrate strong execution across a number of areas that drove solid top and bottom line performance in a difficult operating environment. In addition, we returned funds to shareholders through our increased dividend and share repurchases, and also continued to make investments to support further growth and cost savings.
And is able to discuss we plan to take advantage of that strong position to invest for further growth with the acquisition of Bosons.
Thanks Tom. As we look ahead, the Marzetti company will continue to leverage the combined strength of our team, our operating strategy and our balance sheet and support of the 3. Simple pillars of our growth plan to 1 accelerate Core Business growth 2 to simplify our supply chain to reduce our cost and grow our margins and 3 to expand our core with focused m&a and strategic licensing.
We will continue to have a strong balance sheet following the acquisition.
As we complete the first half of the year, we're pleased to report growth in net sales of 3.6%, and adjusted net sales of 1.7%.
As an example of how we're executing against that third pillar this morning, we announced that the Marzetti company had entered into a definitive agreement to acquire, bosons the authentic, great tasting and rapidly growing Japanese American barbecue brand.
Reported in adjusted gross margin, reflected increases of 30 and 80 basis points, respectively.
Reported operating income was up 2.2% while adjusted operating income increased 3.1%.
Bosons has been built around a multi-generational family recipe passed down to its founder. Justin Gil, who has done an amazing job of development. The products and building this brand.
We are extremely excited to add Bosch on to our portfolio.
In addition, operating cash flow grew by $30.6 million, or 24%.
David Ciesinski: In the months ahead, we look forward to sharing with you our plans to leverage our industry-leading culinary and product development capabilities, and working shoulder to shoulder with the Bachan’s team to deliver long-term growth while maintaining the authenticity and quality that makes Bachan’s brand so special. This transaction reinforces Marzetti's position as a leader in sauces by adding a premium brand that is exceptionally well aligned with evolving consumer preferences for authentic, global flavors, and better for you products. From 2022 to 2025, Bachan’s delivered net revenue compound annual growth of approximately 48%, driven by strong consumer demand and expanded distribution. We see meaningful opportunities to accelerate Bachan’s next chapter of growth by leveraging Marzetti's culinary capability, retail relationships, and food service partnerships.
David Ciesinski: In the months ahead, we look forward to sharing with you our plans to leverage our industry-leading culinary and product development capabilities, and working shoulder to shoulder with the Bachan’s team to deliver long-term growth while maintaining the authenticity and quality that makes Bachan’s brand so special. This transaction reinforces Marzetti's position as a leader in sauces by adding a premium brand that is exceptionally well aligned with evolving consumer preferences for authentic, global flavors, and better for you products. From 2022 to 2025, Bachan’s delivered net revenue compound annual growth of approximately 48%, driven by strong consumer demand and expanded distribution. We see meaningful opportunities to accelerate Bachan’s next chapter of growth by leveraging Marzetti's culinary capability, retail relationships, and food service partnerships.
To wrap up my commentary, our results demonstrate strong execution across a number of areas that drove solid top and bottom line performance in a difficult operating environment.
In addition, we return funds to shareholders through our increased dividend and share purchase.
In the months ahead. We look forward to sharing with you, our plans to leverage our industry-leading culinary and product development capabilities, and working shoulder-to-shoulder with the boson's teams deliver long-term growth, while maintaining the authenticity and quality that makes Bosch on Brands so special.
Thomas Pigott: I'll now turn it back over to Dave for his closing remarks. Thank you.
I'll now turn it back over to Dave for his closing remarks. Thank you.
And also continued to make investments to support further growth in cost savings.
I'll now turn it back over to Dave for his closing remarks. Thank you.
David A. Ciesinski: Thanks, Tom. As we look ahead, the Marzetti Company will continue to leverage the combined strength of our team, our operating strategy, and our balance sheet in support of the three simple pillars of our growth plan. To one, accelerate core business growth. Two, to simplify our supply chain, to reduce our cost, and grow our margins. And three, to expand our core with focused M&A and strategic licensing. As an example of how we're executing against that third pillar, this morning, we announced that the Marzetti Company had entered into a definitive agreement to acquire Bachan's, the authentic, great tasting, and rapidly growing Japanese American barbecue brand. Bachan's has been built around a multigenerational family recipe, passed down to its founder, Justin Gill, who has done an amazing job of developing the products and building this brand. We are extremely excited to add Bachan's to our portfolio.
Dave Ciesinski: Thanks, Tom. As we look ahead, the Marzetti Company will continue to leverage the combined strength of our team, our operating strategy, and our balance sheet in support of the three simple pillars of our growth plan. To one, accelerate core business growth. Two, to simplify our supply chain, to reduce our cost, and grow our margins. And three, to expand our core with focused M&A and strategic licensing. As an example of how we're executing against that third pillar, this morning, we announced that the Marzetti Company had entered into a definitive agreement to acquire Bachan's, the authentic, great tasting, and rapidly growing Japanese American barbecue brand. Bachan's has been built around a multigenerational family recipe, passed down to its founder, Justin Gill, who has done an amazing job of developing the products and building this brand. We are extremely excited to add Bachan's to our portfolio.
This transaction reinforces Marzetti's position. As a leader in sauces, by adding a premium brand, that is exceptionally well aligned with evolving consumer, preferences for authentic Global flavors and better for you products.
Thanks, Tom. As we look ahead, the company will continue to leverage the combined strength of our team, our operating strategy, and our balance sheet, and support the three simple pillars of our growth plan to: 1) accelerate Core Business growth.
2 to simplify our supply chain, to reduce our cost and grow our margins.
From 2022 to 2025, Bosch, on delivered, net, revenue, compound annual growth of approximately 48% driven by strong consumer, demand and expanded distribution.
And three, to expand our core with focused M&A and strategic licensing.
We see meaningful opportunities to accelerate Bosch ons. Next chapter of growth by leveraging Marzetti's culinary, capability retail relationships and Food Service Partnerships.
David Ciesinski: Over time, we intend to broaden distribution, support continued product innovation, and thoughtfully extend the brand into new channels and adjacent categories. We also expect to capture substantial synergies as we carefully integrate Bachan’s into our supply chain by leveraging our scale and expertise in making many of the world's most iconic and great-tasting sauces. The total consideration for the acquisition was approximately $400 million in cash. Overall, we expect this acquisition to be accretive to both top line growth and gross margins beginning in year one. Looking ahead to the back half of our fiscal year, excluding any impact from the planned acquisition, we project retail sales will continue to benefit from our expanding licensing program, led by Texas Roadhouse Dinner Rolls, in addition to investments in innovation and growth for our own brands.
David Ciesinski: Over time, we intend to broaden distribution, support continued product innovation, and thoughtfully extend the brand into new channels and adjacent categories. We also expect to capture substantial synergies as we carefully integrate Bachan’s into our supply chain by leveraging our scale and expertise in making many of the world's most iconic and great-tasting sauces. The total consideration for the acquisition was approximately $400 million in cash. Overall, we expect this acquisition to be accretive to both top line growth and gross margins beginning in year one. Looking ahead to the back half of our fiscal year, excluding any impact from the planned acquisition, we project retail sales will continue to benefit from our expanding licensing program, led by Texas Roadhouse Dinner Rolls, in addition to investments in innovation and growth for our own brands.
As an example of how we're executing against that third pillar, this morning we announced that the Marzetti Company had entered into a definitive agreement to acquire, Bosons, the authentic, great-tasting, and rapidly growing Japanese American barbecue brand.
Over time we intend to broaden distribution, support, continued product Innovation and thoughtfully extend the brand into new channels and adjacent categories.
Bosons has been built around a multi-generational family recipe, passed down to its founder. Justin gill who has done an amazing job of development, the products and building this brand
David A. Ciesinski: In the months ahead, we look forward to sharing with you our plans to leverage our industry-leading culinary and product development capabilities, and working shoulder to shoulder with the Bachan's team to deliver long-term growth while maintaining the authenticity and quality that makes Bachan's brand so special. This transaction reinforces Marzetti's position as a leader in sauces by adding a premium brand that is exceptionally well aligned with evolving consumer preferences for authentic, global flavors and better for you products. From 2022 to 2025, Bachan's delivered net revenue compound annual growth of approximately 48%, driven by strong consumer demand and expanded distribution. We see meaningful opportunities to accelerate Bachan's next chapter of growth by leveraging Marzetti's culinary capability, retail relationships, and food service partnerships.
In the months ahead, we look forward to sharing with you our plans to leverage our industry-leading culinary and product development capabilities, and working shoulder to shoulder with the Bachan's team to deliver long-term growth while maintaining the authenticity and quality that makes Bachan's brand so special. This transaction reinforces Marzetti's position as a leader in sauces by adding a premium brand that is exceptionally well aligned with evolving consumer preferences for authentic, global flavors and better for you products. From 2022 to 2025, Bachan's delivered net revenue compound annual growth of approximately 48%, driven by strong consumer demand and expanded distribution. We see meaningful opportunities to accelerate Bachan's next chapter of growth by leveraging Marzetti's culinary capability, retail relationships, and food service partnerships.
We are extremely excited to add Bosch on to our portfolio.
We also expect to capture substantial synergies. As we carefully integrate boson's into our supply chain, by leveraging our scale and expertise in making many of the world's most iconic and great tasting sauces,
The total consideration for the acquisition was approximately 400 million in cash. Overall, we expect this acquisition to be accretive to both Topline growth and growth margins beginning in year 1.
In the months ahead, we look forward to sharing with you our plans to leverage our industry-leading culinary and product development capabilities, and working shoulder-to-shoulder with the Boson's team to deliver long-term growth, while maintaining the authenticity and quality that makes Bosch on Brands so special.
Check retail sales will continue to benefit from our expanding licensing. Program led by Texas Roadhouse dinner rules, in addition to investments, in Innovation and growth for our own brands.
This transaction reinforces Marzetti's position as a leader in sauces, by adding a premium brand that is exceptionally well aligned with evolving consumer preferences for authentic global flavors and better-for-you products.
David Ciesinski: Note, with this year's earlier Easter holiday, we anticipate some retail segment sales will be pulled forward into our fiscal third quarter. In the food service segment, we expect continued growth from select customers in our mix of national accounts. Like many of you, we continue to monitor external factors, including US economic performance and consumer behavior, that may impact the demand for our products. With respect to our input cost, in the aggregate, we anticipate a modest level of cost inflation that we planned to offset through contractual pricing and our cost savings program as we remain focused on continued margin improvement. In closing, I would like to thank the entire Marzetti Company for all their hard work this past quarter and their ongoing commitment to grow our business.
David Ciesinski: Note, with this year's earlier Easter holiday, we anticipate some retail segment sales will be pulled forward into our fiscal third quarter. In the food service segment, we expect continued growth from select customers in our mix of national accounts. Like many of you, we continue to monitor external factors, including US economic performance and consumer behavior, that may impact the demand for our products. With respect to our input cost, in the aggregate, we anticipate a modest level of cost inflation that we planned to offset through contractual pricing and our cost savings program as we remain focused on continued margin improvement. In closing, I would like to thank the entire Marzetti Company for all their hard work this past quarter and their ongoing commitment to grow our business.
Note with this year's earlier Easter holiday. We anticipate some retail segment sales will be pulled forward into our fiscal third quarter.
From 2022 to 2025, Bosch ons delivered net revenue compound annual growth of approximately 48%, driven by strong consumer demand and expanded distribution.
In the Food Service segment, we expect continued growth from select customers in our mix of national accounts.
Like many of you we continue to monitor external factors including US economic performance and consumer behavior. That may impact the demand for our products.
David A. Ciesinski: Over time, we intend to broaden distribution, support continued product innovation, and thoughtfully extend the brand into new channels and adjacent categories. We also expect to capture substantial synergies as we carefully integrate Bachan's into our supply chain by leveraging our scale and expertise in making many of the world's most iconic and great tasting sauces. The total consideration for the acquisition was approximately $400 million in cash. Overall, we expect this acquisition to be accretive to both top line growth and gross margins beginning in year one. Looking ahead to the back half of our fiscal year, excluding any impact from the planned acquisition, we project retail sales will continue to benefit from our expanding licensing program, led by Texas Roadhouse Dinner Rolls, in addition to investments in innovation and growth for our own brands.
Over time, we intend to broaden distribution, support continued product innovation, and thoughtfully extend the brand into new channels and adjacent categories. We also expect to capture substantial synergies as we carefully integrate Bachan's into our supply chain by leveraging our scale and expertise in making many of the world's most iconic and great tasting sauces. The total consideration for the acquisition was approximately $400 million in cash. Overall, we expect this acquisition to be accretive to both top line growth and gross margins beginning in year one. Looking ahead to the back half of our fiscal year, excluding any impact from the planned acquisition, we project retail sales will continue to benefit from our expanding licensing program, led by Texas Roadhouse Dinner Rolls, in addition to investments in innovation and growth for our own brands.
We see meaningful opportunities to accelerate boson's. Next chapter of growth by leveraging Marzetti's culinary, capability, retail relationships, and Food Service Partnerships.
Over time we intend to broaden distribution, support, continued product Innovation and thoughtfully extend the brand into new channels and adjacent categories.
With respect to our input cost in the aggregate. We anticipate a modest level of cost inflation that we planned to offset through contractual pricing and our cost Savings Program as we remain focused on continued margin improvements.
In closing, I would like to thank the entire Marzetti company for all their hard work, this past quarter and they're ongoing commitment to grow our business.
We also expect to capture substantial synergies. As we carefully integrate boson's into our supply chain, by leveraging our scale and expertise in making many of the world's most iconic and great tasting sauces,
David Ciesinski: I would also like to convey to Justin Gill and the entire Bachan’s team, how excited we are about the opportunities to grow that lie ahead. This concludes our prepared remarks for today, and we'd be happy to answer any questions you may have. Operator?
David Ciesinski: I would also like to convey to Justin Gill and the entire Bachan’s team, how excited we are about the opportunities to grow that lie ahead. This concludes our prepared remarks for today, and we'd be happy to answer any questions you may have. Operator?
I would also like to convey to Justin Gil and the entire bosons team how excited we are about the opportunities to grow. They'll lie ahead.
This concludes our prepared remarks for today, and we'd be happy to answer any questions. You may have operator.
The total consideration for the acquisition was approximately $400 million in cash. Overall, we expect this acquisition to be accretive to both topline growth and gross margins beginning in year one.
Operator: At this time, I would like to remind everyone, in order to ask a question, please press star one, one on your telephone keypad. Your first question comes from the line of Scott Marks from Jefferies. Your line is open.
Operator: At this time, I would like to remind everyone, in order to ask a question, please press star one, one on your telephone keypad. Your first question comes from the line of Scott Marks from Jefferies. Your line is open.
At this time, I would like to remind everyone in order to ask a question. Please press star 1 1 on your telephone keypad,
David A. Ciesinski: Note, with this year's earlier Easter holiday, we anticipate some retail segment sales will be pulled forward into our fiscal third quarter. In the food service segment, we expect continued growth from select customers in our mix of national accounts. Like many of you, we continue to monitor external factors, including US economic performance and consumer behavior, that may impact the demand for our products. With respect to our input costs, in the aggregate, we anticipate a modest level of cost inflation that we planned to offset through contractual pricing and our cost savings program as we remain focused on continued margin improvement. In closing, I would like to thank the entire Marzetti Company for all their hard work this past quarter and their ongoing commitment to grow our business.
Note, with this year's earlier Easter holiday, we anticipate some retail segment sales will be pulled forward into our fiscal third quarter. In the food service segment, we expect continued growth from select customers in our mix of national accounts. Like many of you, we continue to monitor external factors, including US economic performance and consumer behavior, that may impact the demand for our products. With respect to our input costs, in the aggregate, we anticipate a modest level of cost inflation that we planned to offset through contractual pricing and our cost savings program as we remain focused on continued margin improvement. In closing, I would like to thank the entire Marzetti Company for all their hard work this past quarter and their ongoing commitment to grow our business.
Looking ahead to the back half of our fiscal year, excluding any impact from the planned acquisition, we project retail sales will continue to benefit from our expanding licensing program, led by Texas Roadhouse dinner rolls, in addition to investments in innovation and growth for our own brands.
And your first question comes from the line of Scott Marks from Jeffrey's. Your line is open.
Hey, good morning. Thanks so much for taking your questions.
Note that with this year's earlier Easter holiday, we anticipate some retail segment sales will be pulled forward into our fiscal third quarter.
Scott Marks: Hey, good morning. Thanks so much for taking our questions. First, I wanted to ask, right, you know, just wanted to ask a little bit about top-line performance in the quarter. I think you called out on retail, obviously, lapping a very strong quarter last year, as well as some of the government-
Scott Marks: Hey, good morning. Thanks so much for taking our questions. First, I wanted to ask, right, you know, just wanted to ask a little bit about top-line performance in the quarter? I think you called out on retail, obviously, lapping a very strong quarter last year, as well as some of the government-
In the Food Service segment, we expect continued growth from select customers in our mix of national accounts.
Many of you we continue to monitor external factors including US economic performance and consumer behavior. That may impact the demand for our products.
David Ciesinski: Yeah.
David Ciesinski: Yeah.
Scott Marks: -shutdown impacts.
Scott Marks: -shutdown impacts?
David Ciesinski: Yeah.
David Ciesinski: Yeah.
Scott Marks: You know, as we think about maybe the go forward, you know, should we expect that the impacts from those government shutdowns are fully behind us? Should we be thinking about any type of inventory rebuild coming into the pipeline, in addition to some of those Easter shifts or any other dynamics that we should be thinking about with regard to the retail segment?
Scott Marks: You know, as we think about maybe the go forward, you know, should we expect that the impacts from those government shutdowns are fully behind us? Should we be thinking about any type of inventory rebuild coming into the pipeline, in addition to some of those Easter shifts or any other dynamics that we should be thinking about with regard to the retail segment?
With respect to our input cost in the aggregate, we anticipate a modest level of cost inflation that we plan to offset through contractual pricing and our Cost Savings Program, as we remain focused on continued margin improvements.
Um first thing, right? Um, you know just wanted to ask a little bit about Topline performance in the quarter. I think you called out on retail, obviously lasting a very strong quarter last year as well as some of the government shutdown impacts. Um yeah. You know as as we think about maybe the go forward um you know, should we expect that the impacts from those government shutdowns are fully behind us? Should we be thinking about any type of inventory rebuild coming into the coming into the pipeline? In addition to some of those Easter shifts or any other dynamics that we should be thinking about with regard to the retail segment.
David A. Ciesinski: I would also like to convey to Justin Gill and the entire Bachan's team, how excited we are about the opportunities to grow that lie ahead. This concludes our prepared remarks for today, and we'd be happy to answer any questions you may have. Operator?
I would also like to convey to Justin Gill and the entire Bachan's team, how excited we are about the opportunities to grow that lie ahead. This concludes our prepared remarks for today, and we'd be happy to answer any questions you may have. Operator?
In closing, I would like to thank the entire Marzetti company for all their hard work this past quarter, and their ongoing commitment to grow our business.
David Ciesinski: Yeah, it's a great question, one that we've obviously watched carefully, and maybe I'll try to frame it in a little context for you. First, as you pointed out on the retail side of the business, we were going up against a strong comp last year where our volume was actually up 7.4%. Then you sort of walked down from that. As you highlighted, we saw a bit of a category slowdown between the 13-week period and the 5-week period across all MULO and in our categories, in particular. And importantly, Scott, as you pointed out, by the time we got back into December, we started to see those rates recover as we moved along.
David Ciesinski: Yeah, it's a great question, one that we've obviously watched carefully, and maybe I'll try to frame it in a little context for you. First, as you pointed out on the retail side of the business, we were going up against a strong comp last year where our volume was actually up 7.4%. Then you sort of walked down from that. As you highlighted, we saw a bit of a category slowdown between the 13-week period and the 5-week period across all MULO and in our categories, in particular. And importantly, Scott, as you pointed out, by the time we got back into December, we started to see those rates recover as we moved along.
I would also like to convey to Justin Gil and the entire bosons team how excited we are about the opportunities to grow the LIE ahead.
Yeah, it's it's a great question, 1 that we've obviously watched carefully and maybe I'll try to frame it in a little context for you. First, as you pointed out on the retail side of the business, we were going up against a strong comp last year, where a volume was actually up 7.4%.
This concludes our prepared remarks for today, and we'd be happy to answer any questions. You may have operator.
Operator: At this time, I would like to remind everyone, in order to ask a question, please press star one, one on your telephone keypad. Your first question comes from the line of Scott Marks from Jefferies. Your line is open.
Operator: At this time, I would like to remind everyone, in order to ask a question, please press star one, one on your telephone keypad. Your first question comes from the line of Scott Marks from Jefferies. Your line is open.
Then you sort of walked down from that. As you highlighted we saw a bit of a category slowdown between the 13-week period and the 5-week period.
At this time, I would like to remind everyone in order to ask a question. Please press star 1 1 1 on your telephone keypad,
And your first question comes from the line of Scott Marks from Jefferies. Your line is open.
[Analyst] (Jefferies): Hey, good morning. Thanks so much for taking our questions. First thing I wanted to ask, right, you know, just wanted to ask a little bit about top line performance in the quarter. I think you called out on retail, obviously lapping a very strong quarter last year, as well as some of the government-
Scott Marks: Hey, good morning. Thanks so much for taking our questions. First thing I wanted to ask, right, you know, just wanted to ask a little bit about top line performance in the quarter. I think you called out on retail, obviously lapping a very strong quarter last year, as well as some of the government-
Hey, good morning. Thanks so much for taking your questions.
David Ciesinski: As we then lift our focus to the go-forward period, we continue to believe that we're set up to deliver low single-digit volume growth against this business here.
David Ciesinski: As we then lift our focus to the go-forward period, we continue to believe that we're set up to deliver low single-digit volume growth against this business here.
Across all moveo and in our categories, uh, in particular and importantly, Scott as as you pointed out by the time we got back into December, we started to see those rates uh recover as as we we moved along. As we, then lift our our Focus to the go forward, period. We continue to believe that we're set up to the liver low single digit volume growth against this, this business here.
David A. Ciesinski: Yeah.
Dave Ciesinski: Yeah.
[Analyst] (Jefferies): Shutdown impacts.
Scott Marks: Shutdown impacts.
David A. Ciesinski: Yeah.
Dave Ciesinski: Yeah.
[Analyst] (Jefferies): You know, as we think about maybe the go forward, you know, should we expect that the impacts from the government shutdowns are fully behind us? Should we be thinking about any type of inventory rebuild coming into the pipeline, in addition to some of those Easter shifts or any other dynamics that we should be thinking about with regard to the retail segment?
Scott Marks: You know, as we think about maybe the go forward, you know, should we expect that the impacts from the government shutdowns are fully behind us? Should we be thinking about any type of inventory rebuild coming into the pipeline, in addition to some of those Easter shifts or any other dynamics that we should be thinking about with regard to the retail segment?
Scott Marks: ... Got it. Appreciate the answer there. And then maybe just shifting over to the food service side. I think after last quarter, the commentary was pretty, pretty positive, you know, just around some of the initiatives within food service and being able to continue with, with some of the volume momentum. Obviously, volumes came in a little bit, a little bit softer than folks were expecting. So just wondering if you can share with us maybe, you know, what happened in the quarter? What was the reason for the organic volume declines, and then how are you thinking about rest of the year for that food service segment? Thanks.
Scott Marks: ... Got it. Appreciate the answer there. And then maybe just shifting over to the food service side. I think after last quarter, the commentary was pretty, pretty positive, you know, just around some of the initiatives within food service and being able to continue with, with some of the volume momentum. Obviously, volumes came in a little bit, a little bit softer than folks were expecting. So just wondering if you can share with us maybe, you know, what happened in the quarter? What was the reason for the organic volume declines, and then how are you thinking about rest of the year for that food service segment? Thanks.
Um, first thing, right? Um, you know, just wanted to ask a little bit about topline performance in the quarter. I think you called out on retail, obviously lapping a very strong quarter last year, as well as some of the government shutdown impacts. Um, yeah. You know, as we think about maybe the go forward, um, you know, should we expect that the impacts from those government shutdowns are fully behind us? Should we be thinking about any type of inventory rebuild coming into the pipeline, in addition to some of those Easter shifts or any other dynamics that we should be thinking about with regard to the retail segment.
David A. Ciesinski: Yeah, it's, it's a great question, one that we've obviously watched carefully, and maybe I'll try to frame it in a little context for you. First, as you pointed out on the retail side of the business, we were going up against a strong comp last year where our volume was actually up 7.4%. Then you sort of walk down from that, as you highlighted, we saw a bit of a category slowdown between the 13-week period and the 5-week period across all MULO and in our categories, in particular. And importantly, Scott, as, as you pointed out, by the time we got back into December, we started to see those rates, recover as, as we, we moved along.
Dave Ciesinski: Yeah, it's, it's a great question, one that we've obviously watched carefully, and maybe I'll try to frame it in a little context for you. First, as you pointed out on the retail side of the business, we were going up against a strong comp last year where our volume was actually up 7.4%. Then you sort of walk down from that, as you highlighted, we saw a bit of a category slowdown between the 13-week period and the 5-week period across all MULO and in our categories, in particular. And importantly, Scott, as, as you pointed out, by the time we got back into December, we started to see those rates, recover as, as we, we moved along.
Got it. Um, appreciate the answer there and then maybe just shifting over to the Food Service side. Um, I think after last quarter uh the commentary was pretty pretty positive, you know, just around some of the initiatives within food service and being able to continue with with some of the volume momentum, uh obviously, um, the volumes came in a little bit, uh, a little bit softer than folks were expecting, so just wondering if you can share with us, maybe
What happened in the quarter? What was the reason for the, the organic volume? Declines. And then how are you thinking about rest of the year for that food, service segment.
Yeah, it's a great question—one that we've obviously watched carefully. Maybe I'll try to frame it in a little context for you. First, as you pointed out, on the retail side of the business, we were going up against a strong comp last year, where our volume was actually up 7.4%.
David Ciesinski: Yeah. Let's do the same thing. Let's kind of ladder up and set a little context for the industry, and then we'll bring it down specifically to our business. So at a overall industry level, I think the best way to categorize things that essentially they're flat. We also saw a bit of a pull back in food service during the period of government shutdown, but there again, we saw an element of normalization. If you look at most of our large national accounts, we're continuing to win with those, Chick-fil-A, Domino’s, Taco Bell, et cetera. I would say in those particular cases, you know, we were very satisfied with their performance and our performance.
David Ciesinski: Yeah. Let's do the same thing. Let's kind of ladder up and set a little context for the industry, and then we'll bring it down specifically to our business. So at a overall industry level, I think the best way to categorize things that essentially they're flat. We also saw a bit of a pull back in food service during the period of government shutdown, but there again, we saw an element of normalization. If you look at most of our large national accounts, we're continuing to win with those, Chick-fil-A, Domino’s, Taco Bell, et cetera. I would say in those particular cases, you know, we were very satisfied with their performance and our performance.
Then you had sort of walked down from that. As you highlighted, we saw a bit of a category slowdown between the 13-week period and the 5-week period.
Thanks. Yeah let's do the same thing. Let's kind of ladder up and set a little context for the industry and then we'll bring it down specifically to our business. So at a overall industry level, I think the best way to categorize things that essentially they're flat.
David A. Ciesinski: As we then lift our focus to the go-forward period, we continue to believe that we're set up to deliver low single digit volume growth against this business here.
As we then lift our focus to the go-forward period, we continue to believe that we're set up to deliver low single digit volume growth against this business here.
Across all moveo and in our categories, uh, in particular and importantly, Scott as as you pointed out by the time we got back into December, we started to see those rates uh recover as as we we moved along. As we then lift our our Focus to the go forward, period. We continue to believe that we're set up to deliver low single digit volume growth against this this business here.
[Analyst] (Jefferies): Got it. Appreciate the answer there. And then maybe just shifting over to the Food Service side. I think after last quarter, the commentary was pretty, pretty positive, you know, just around some of the initiatives within Food Service and being able to continue with, with some of the volume momentum. Obviously, volumes came in a little bit, a little bit softer than folks were expecting. So just wondering if you can share with us maybe, you know, what happened in the quarter? What was the reason for the, the organic volume declines, and then how are you thinking about rest of the year for that Food Service segment? Thanks.
Scott Marks: Got it. Appreciate the answer there. And then maybe just shifting over to the Food Service side. I think after last quarter, the commentary was pretty, pretty positive, you know, just around some of the initiatives within Food Service and being able to continue with, with some of the volume momentum. Obviously, volumes came in a little bit, a little bit softer than folks were expecting. So just wondering if you can share with us maybe, you know, what happened in the quarter? What was the reason for the, the organic volume declines, and then how are you thinking about rest of the year for that Food Service segment? Thanks.
David Ciesinski: If you go back and you look at the script for probably the last couple of periods, we talked about the fact that we were going to be lapping a couple of limited time offerings during this period that we thought were going to create a hole. I think that the setup that we used is we expected volume to be down a couple of points, and for us to be able to get a little bit of pricing to get us closer to flat in the business. So again, I think the way we were thinking about it then, it came in, I would say, at or maybe even slightly better than we were expecting. Now let's come in maybe even a click deeper on what actually happened in the period.
David Ciesinski: If you go back and you look at the script for probably the last couple of periods, we talked about the fact that we were going to be lapping a couple of limited time offerings during this period that we thought were going to create a hole. I think that the setup that we used is we expected volume to be down a couple of points, and for us to be able to get a little bit of pricing to get us closer to flat in the business. So again, I think the way we were thinking about it then, it came in, I would say, at or maybe even slightly better than we were expecting. Now let's come in maybe even a click deeper on what actually happened in the period.
Got it. Um, appreciate the answer there and then maybe just shifting over to the Food Service side.
The last couple of periods, we talked about the fact that we were going to be lapping a couple of limited time offerings during this period that we thought were going to create a hole. I think that the, the setup that we use is we expected a volume to be down a couple of points. And for us to be able to get a little bit of pricing uh to get us closer to Flat in the business. So again I I think the way we were thinking about it then it came in I would say at or maybe even slightly better than we were expecting. Um now let's come in maybe even a click deeper on what actually happened in the period.
David A. Ciesinski: Yeah. Let's do the same thing. Let's kind of ladder up and set a little context for the industry, and then we'll bring it down specifically to our business. So, at an overall industry level, I think the best way to categorize things that essentially they're flat. We also saw a bit of a pull back in Food Service during the period of government shutdown, but there again, we saw an element of normalization. If you look at most of our large national accounts, we're continuing to win with those, Chick-fil-A, Domino's, Taco Bell, et cetera. I would say in those particular cases, you know, we were very satisfied with their performance and our performance.
Dave Ciesinski: Yeah. Let's do the same thing. Let's kind of ladder up and set a little context for the industry, and then we'll bring it down specifically to our business. So, at an overall industry level, I think the best way to categorize things that essentially they're flat. We also saw a bit of a pull back in Food Service during the period of government shutdown, but there again, we saw an element of normalization. If you look at most of our large national accounts, we're continuing to win with those, Chick-fil-A, Domino's, Taco Bell, et cetera. I would say in those particular cases, you know, we were very satisfied with their performance and our performance.
David Ciesinski: You know, first, I think it's we've continued to work and benefit from our partners that are doing well on a relative basis. And particularly, we had a number of, of specialty sauce promotions that were going on in the period, either new items that were limited time offerings, or in some cases, just core menu sauces that we've used that select, food service partners have decided to promote in the period. So on this piece of the business, as you continue to shift your focus, forward, I would argue that we're feeling a little bit more optimistic than we might have the last couple of quarters.
David Ciesinski: You know, first, I think it's we've continued to work and benefit from our partners that are doing well on a relative basis. And particularly, we had a number of, of specialty sauce promotions that were going on in the period, either new items that were limited time offerings, or in some cases, just core menu sauces that we've used that select, food service partners have decided to promote in the period. So on this piece of the business, as you continue to shift your focus, forward, I would argue that we're feeling a little bit more optimistic than we might have the last couple of quarters.
Um, you know, first I think it's we've continued to work and benefit from our partners that are doing well on a relative basis.
Um, I think, after last quarter uh, the commentary was pretty pretty positive, you know, just around some of the initiatives within food service and being able to continue with with some of the volume momentum, uh, obviously, um, the volumes came in a little bit, uh, a little bit softer than folks were expecting, so just wondering if you can share with us maybe. Um, you know, what happened in the quarter, what was the reason for the, the organic volume declines. And then, how are you thinking about that rest of the year for that food service segment? Thanks. Yeah, let's do the same thing. Let's kind of ladder up and set a little context for the industry and then we'll bring it down specifically to our business. So at a overall industry level, I think the best way to categorize things that essentially they're flat.
Um and particularly we had a number of of specialty sauce promotions that were going on in the period, either new items that were limited time offerings. Or in some cases, just core menu, sauces. That we've used that select uh, Food Service Partners have decided to promote in the period.
David A. Ciesinski: If you go back and you look at the script for probably the last couple of periods, we talked about the fact that we were going to be lapping a couple of limited time offerings during this period that we thought were going to create a hole. I think that the setup that we used is we expected volume to be down a couple of points and for us to be able to get a little bit of pricing to get us closer to flat in the business. So again, I think the way we were thinking about it then, it came in, I would say, at or maybe even slightly better than we were expecting. Now let's come in maybe even a click deeper on what actually happened in the period.
David Ciesinski: You know, all eyes are on the consumer to see what happens, but, you know, it's really hard to envision as we move now into calendar year 2026, you know, short of a black swan, something changing materially on the downside. I think there are a couple of things that are working in our favor for everybody that services food service. First, gas prices are down year-over-year, which we know gives consumers discretionary spending that oftentimes comes back in a way from home dining. The other thing that we're seeing here is like you, I think we're expecting income tax returns to be a little bit stronger this year than they were last year because of some of these changes, and those ordinarily hit around the time of President's Weekend or so. So you put the fact that inflation remains relatively in check.
David Ciesinski: You know, all eyes are on the consumer to see what happens, but, you know, it's really hard to envision as we move now into calendar year 2026, you know, short of a black swan, something changing materially on the downside. I think there are a couple of things that are working in our favor for everybody that services food service. First, gas prices are down year-over-year, which we know gives consumers discretionary spending that oftentimes comes back in a way from home dining. The other thing that we're seeing here is like you, I think we're expecting income tax returns to be a little bit stronger this year than they were last year because of some of these changes, and those ordinarily hit around the time of President's Weekend or so. So you put the fact that inflation remains relatively in check.
If you go back and you look at the script for probably the last couple of periods, we talked about the fact that we were going to be lapping a couple of limited time offerings during this period that we thought were going to create a hole. I think that the setup that we used is we expected volume to be down a couple of points and for us to be able to get a little bit of pricing to get us closer to flat in the business. So again, I think the way we were thinking about it then, it came in, I would say, at or maybe even slightly better than we were expecting. Now let's come in maybe even a click deeper on what actually happened in the period.
So, on this piece of the business, as you continue to shift your focus forward, I would argue that we're feeling a little bit more optimistic than we might have the last couple of quarters. You know, all eyes are on the consumer to see what happens. But, you know, it's really hard to Envision as we move now into calendar year, 26.
You know, short of a Black Swan, something changing materially on the downside. I think there are a couple of things that are working in our favor for everybody that that Services Food Service, First gas prices are down year against year which we know gives, consumers, discretionary spending that oftentimes comes back and away from home dining.
David A. Ciesinski: You know, first, I think it's we continued to work and benefit from our partners that are doing well on a relative basis. And particularly, we had a number of, of specialty sauce promotions that were going on in the period, either new items that were limited time offerings, or in some cases, just core menu sauces that we've used that select food service partners have decided to promote in the period. So on this piece of the business, as you continue to shift your focus forward, I would argue that we're feeling a little bit more optimistic than we might have the last couple of quarters.
Better than we were expecting. Um, now let's come in maybe even a click deeper on what actually happened in the period.
You know, first, I think it's we continued to work and benefit from our partners that are doing well on a relative basis. And particularly, we had a number of, of specialty sauce promotions that were going on in the period, either new items that were limited time offerings, or in some cases, just core menu sauces that we've used that select food service partners have decided to promote in the period. So on this piece of the business, as you continue to shift your focus forward, I would argue that we're feeling a little bit more optimistic than we might have the last couple of quarters.
Um, you know, first I think it's we've continued to work and benefit from our partners that are doing well on a relative basis.
David Ciesinski: Gas prices seem to be moderating some. There's a case for slightly stronger income tax returns. I think the setup there for all of food service is at least for a flat scenario, if not for a modest improvement. And if past is prologue, what we see is that the winners continue to win in this environment, and I think this is where we're continued to perform relatively well. So that would be kind of the view.
David Ciesinski: Gas prices seem to be moderating some. There's a case for slightly stronger income tax returns. I think the setup there for all of food service is at least for a flat scenario, if not for a modest improvement. And if past is prologue, what we see is that the winners continue to win in this environment, and I think this is where we're continued to perform relatively well. So that would be kind of the view.
The other thing that we're seeing here is, is like, you, I, I think we're expecting income tax returns to be a little bit stronger, this year, than they were last year because of some of these changes and those ordinarily, hit around the time of president's weekend or so. So you put the fact that inflation remains relatively in check gas prices seem to be moderating some, there's a case for slightly stronger income tax returns. I think the setup there for all the food service is is at least for a flat scenario if not for a, a modest Improvement. Um, and
Um and particularly we had a number of of specialty sauce promotions that were going on in the period, either new items that were limited time offerings. Or in some cases, just core menu, sauces. That we've used that select uh, Food Service Partners have decided to promote in the period.
If if past is prologue, what we see is, is that the winners continue to win in this environment. And I think this is where we're continued to perform relatively. Well, so that that would be kind of the The View.
David A. Ciesinski: You know, all eyes are on the consumer to see what happens, but, you know, it's really hard to envision as we move now into calendar year 2026, you know, short of a black swan, something changing materially on the downside. I think there are a couple of things that are working in our favor for everybody that services Food Service. First, gas prices are down year-over-year, which we know gives consumers discretionary spending that oftentimes comes back in away-from-home dining. The other thing that we're seeing here is like you, I think we're expecting income tax returns to be a little bit stronger this year than they were last year because of some of these changes, and those ordinarily hit around the time of President's weekend or so. So you put the fact that inflation remains relatively in check.
You know, all eyes are on the consumer to see what happens, but, you know, it's really hard to envision as we move now into calendar year 2026, you know, short of a black swan, something changing materially on the downside. I think there are a couple of things that are working in our favor for everybody that services Food Service. First, gas prices are down year-over-year, which we know gives consumers discretionary spending that oftentimes comes back in away-from-home dining. The other thing that we're seeing here is like you, I think we're expecting income tax returns to be a little bit stronger this year than they were last year because of some of these changes, and those ordinarily hit around the time of President's weekend or so. So you put the fact that inflation remains relatively in check.
Understood. Appreciate the thorough answer. I'll pass it on. Yes, pleasure. Thanks Scott.
Scott Marks: Understood. Appreciate the thorough answer. We'll pass it on.
Scott Marks: Understood. Appreciate the thorough answer. We'll pass it on.
So, on this piece of the business, as you continue to shift your focus forward, I would argue that we're feeling a little bit more optimistic than we might have the last couple of quarters. You know, all eyes are on the consumer to see what happens. But, you know it's it's really hard to Envision as we move now into calendar year 26.
David Ciesinski: Yes, pleasure.
David Ciesinski: Yes, pleasure.
Jim Salera: Thanks, guys.
Jim Salera: Thanks, guys.
Operator: Thank you. And our next question comes from the line of Todd Brooks with The Benchmark Company. Your line is now open.
Operator: Thank you. And our next question comes from the line of Todd Brooks with The Benchmark Company. Your line is now open.
Thank you. And our next question comes from the line of Todd Brooks with Benchmark. Xonex your line is now open.
Todd Brooks: Hey, great. Thanks for taking my call.
Todd Brooks: Hey, great. Thanks for taking my call.
You know, short of a black 1, something changing materially on the downside. I think there are a couple of things that are working in our favor for everybody that that Services Food Service, First gas prices are down year against year, which we know gives, consumers, discretionary spending that. Often times comes back and away from home dining.
David Ciesinski: Of course, Todd.
David Ciesinski: Of course, Todd.
Todd Brooks: Wanda, a congratulations on the Bachan’s acquisition. I was wondering, I know there'll be a plan for the synergies and everything that you'll look to be harvesting, but if you look at that business in 2025, I think it was like an $87 million business, but wondering what kind of the exit rate was. It looks like maybe there was some SKU expansion, there was probably door expansion. As we think about maybe an exit quarterly run rate for Bachan’s in Q4 2025, is there anything you can share there?
Todd Brooks: Wanda, a congratulations on the Bachan’s acquisition. I was wondering, I know there'll be a plan for the synergies and everything that you'll look to be harvesting, but if you look at that business in 2025, I think it was like an $87 million business, but wondering what kind of the exit rate was. It looks like maybe there was some SKU expansion, there was probably door expansion. As we think about maybe an exit quarterly run rate for Bachan’s in Q4 2025, is there anything you can share there?
David A. Ciesinski: Gas prices seem to be moderating some. There's a case for slightly stronger income tax returns. I think the setup there for all of Food Service is at least for a flat scenario, if not for a modest improvement. And if past is prologue, what we see is that the winners continue to win in this environment, and I think this is where we'll continue to perform relatively well. So that would be kind of the view.
Gas prices seem to be moderating some. There's a case for slightly stronger income tax returns. I think the setup there for all of Food Service is at least for a flat scenario, if not for a modest improvement. And if past is prologue, what we see is that the winners continue to win in this environment, and I think this is where we'll continue to perform relatively well. So that would be kind of the view.
Hey, great. Thanks for taking my call. Um, course, Todd Wonder a congratulations on on the boson's. Acquisition was wondering, I know there'll be a plan for the synergies and everything that you'll look to be harvesting, but if you look at that business in 257 million business, but wondering what kind of the exit rate was? It looks like maybe there was some skew expansion. There was probably door expansion as we think about maybe an exit quarterly run rate for uh, for Bosch. And and uh, Q4 25 is there anything you can share their
David Ciesinski: Yeah. So why don't I maybe step back and frame it, if you'll allow me, a little more broadly. But first of all, this is a business that we had been tracking in the industry for the better part of four years. It's a really an amazing product and amazing brand. It's an authentic founder story. It's great tasting, clean label, and what we love about this product, Todd, is that when you look at it, it significantly over indexes with millennials and Gen Z. So it does well with all of the various cohorts. But if you look at sort of the future of food consumption, and these are people that love their sauces, it does particularly well with those cohorts. And that in conjunction with the fact that the brand has very broad shoulders.
David Ciesinski: Yeah. So why don't I maybe step back and frame it, if you'll allow me, a little more broadly. But first of all, this is a business that we had been tracking in the industry for the better part of four years. It's a really an amazing product and amazing brand. It's an authentic founder story. It's great tasting, clean label, and what we love about this product, Todd, is that when you look at it, it significantly over indexes with millennials and Gen Z. So it does well with all of the various cohorts. But if you look at sort of the future of food consumption, and these are people that love their sauces, it does particularly well with those cohorts. And that in conjunction with the fact that the brand has very broad shoulders.
The other thing that we're seeing here is is like, you, I, I think we're expecting income tax returns to be a little bit stronger, this year, than they were last year because of some of these changes and those ordinarily, hit around the time of Presidents Weekend or so. So you put the fact that inflation remains relatively in check gas prices. Seem to be moderating some, there's a case for slightly stronger income tax returns. I think the setup there for all the food service is is at least for a flat scenario if not for a, a modest Improvement. Um, and
Yeah. So why don't I maybe step back and frame it if you allow me a little more broadly. But first of all, this is a business that that we had been tracking in the industry for the better part of of 4 years.
It's a really, an amazing product, and an amazing brand. Uh, it's an authentic founder story. It's great tasting.
If past is prologue, what we see is that the winners continue to win in this environment. And I think this is where we've continued to perform relatively well, so that would be kind of the view.
[Analyst] (Jefferies): Understood. Appreciate the thorough answer. We'll pass it on.
Scott Marks: Understood. Appreciate the thorough answer. We'll pass it on.
David A. Ciesinski: Yes, pleasure.
Dave Ciesinski: Yes, pleasure.
[Analyst] (Jefferies): Thanks, Scott.
Tom Pigott: Thanks, Scott.
Understood, appreciate the thorough answer. We'll pass it on. Yes, pleasure.
Thanks Scott.
Operator: Thank you. And our next question comes from the line of Todd Brooks with Benchmark Company. Your line is now open.
Operator: Thank you. And our next question comes from the line of Todd Brooks with Benchmark Company. Your line is now open.
Clean label. And what we love about this product, um, Todd, is that when you look at it it's significantly over indexes with Millennials and gen Z so it does well with with all of the various cohorts. But if you look at sort of the future of food consumption and these are people that love their sauces, it does particularly well with those cohorts
Thank you, Ian. Our next question comes from the line of Todd Brooks with Benchmark. Todd, your line is now open.
[Analyst] (Benchmark Company): Hey, great. Thanks for taking my call.
Todd Brooks: Hey, great. Thanks for taking my call.
David A. Ciesinski: Of course, Todd.
Dave Ciesinski: Of course, Todd.
[Analyst] (Benchmark Company): Wanda, hey, congratulations on, on the Bachan's acquisition. I was wondering, I know there'll be a plan for the synergies and everything that you'll look to be harvesting, but if you look at that business in 2025, I think it was like an $87 million business, but wondering what kind of the exit rate was. It looks like maybe there was some SKU expansion, there was probably door expansion. As we think about maybe an exit quarterly run rate for, for Bachan's in, Q4 2025, is there anything you can share there?
Todd Brooks: Wanda, hey, congratulations on, on the Bachan's acquisition. I was wondering, I know there'll be a plan for the synergies and everything that you'll look to be harvesting, but if you look at that business in 2025, I think it was like an $87 million business, but wondering what kind of the exit rate was. It looks like maybe there was some SKU expansion, there was probably door expansion. As we think about maybe an exit quarterly run rate for, for Bachan's in, Q4 2025, is there anything you can share there?
David Ciesinski: It plays in sauces, it plays in marinades, plays in glazes, even plays in dips. We tested all of these items. It gave us reason to believe that this could be a very meaningful brand platform for us. And as we talked to, you know, Justin Gill, the founder of the business, and his team, really what we focused on was the fact that we believe we have best in industry, culinary, and product development capabilities. We can't develop everything, but when it comes to sauces and dips and flavor systems, we believe that we really have, you know, top-of-the-peer group capabilities. And I think that became part of a selling point for our partnership together. Now, as you pointed out, you know, the business did $87 million in sales, strong growth rate.
David Ciesinski: It plays in sauces, it plays in marinades, plays in glazes, even plays in dips. We tested all of these items. It gave us reason to believe that this could be a very meaningful brand platform for us. And as we talked to, you know, Justin Gill, the founder of the business, and his team, really what we focused on was the fact that we believe we have best in industry, culinary, and product development capabilities. We can't develop everything, but when it comes to sauces and dips and flavor systems, we believe that we really have, you know, top-of-the-peer group capabilities. And I think that became part of a selling point for our partnership together. Now, as you pointed out, you know, the business did $87 million in sales, strong growth rate.
And uh that in conjunction with the fact that the brand has very broad shoulders, it plays in sauces, place in marinades, place in uh, glazes even plays in dips. We tested all of these items it gave us reason to believe that this could be a, a very meaningful brand platform for us.
David A. Ciesinski: Yeah. So why don't I maybe step back and frame it, if you'll allow me, a little more broadly. But first of all, this is a business that we had been tracking in the industry for the better part of four years... It's really an amazing product and amazing brand. It's an authentic founder story, it's great tasting, clean label. And what we love about this product, Todd, is that when you look at it, it significantly over indexes with millennials and Gen Z. So it does well with all of the various cohorts. But if you look at sort of the future of food consumption, and these are people that love their sauces, it does particularly well with those cohorts. And that in conjunction with the fact that the brand has very broad shoulders.
Dave Ciesinski: Yeah. So why don't I maybe step back and frame it, if you'll allow me, a little more broadly. But first of all, this is a business that we had been tracking in the industry for the better part of four years... It's really an amazing product and amazing brand. It's an authentic founder story, it's great tasting, clean label. And what we love about this product, Todd, is that when you look at it, it significantly over indexes with millennials and Gen Z. So it does well with all of the various cohorts. But if you look at sort of the future of food consumption, and these are people that love their sauces, it does particularly well with those cohorts. And that in conjunction with the fact that the brand has very broad shoulders.
Hey, great. Thanks for taking my call. Um, of course, Todd w. A congratulations on on the boson's acquisition. I was wondering, I know there'll be a plan for the synergies and everything that you look to be harvesting, but if you look at that business in 25, I think it was like in 87 million business but wondering what kind of the exit rate was? It looks like maybe there was some skew expansion. There was probably door expansion as we think about maybe an exit quarterly run rate for uh, for Bosch. And and uh, Q4 25 is there anything you can share their
Yeah. So why don't I maybe step back and frame it if you allow me a little more broadly. But first of all, this is a business that that we had been tracking in the industry for the better part of of 4 years.
David Ciesinski: If you look at the history of the business, it grew principally through Costco and then began to diversify into mass, with Walmart and into retail. So the mix of the business was growing a little bit faster this most recent year in mass and in retail. The price point is premium, which gives us the ability to make it margin accretive. And as you might imagine, there is a synergy case here, given that this is in sauces, and it's really our wheelhouse to be able to support this business. So overall, you bring it all together, authentic founder story, great tasting product, aligned with where consumers are going, GLP friendly. It really just made a lot of sense for us. So a very exciting item here.
David Ciesinski: If you look at the history of the business, it grew principally through Costco and then began to diversify into mass, with Walmart and into retail. So the mix of the business was growing a little bit faster this most recent year in mass and in retail. The price point is premium, which gives us the ability to make it margin accretive. And as you might imagine, there is a synergy case here, given that this is in sauces, and it's really our wheelhouse to be able to support this business. So overall, you bring it all together, authentic founder story, great tasting product, aligned with where consumers are going, GLP friendly. It really just made a lot of sense for us. So a very exciting item here.
Focused on was the fact that we believe we have best in Industry culinary and product development capabilities. We can't develop everything, but when it comes to sauces and dips and flavor systems, we believe that we really have, you know, top of the peer group capabilities, and I think that became part of a, a selling point for our partnership together. Now, as you pointed out, you know, the business did 87 million in sales, uh, strong growth rate, you know, if you look at the history of the business, it it grew principally through Costco and then began to diversify into Mass, uh, into, um, with Walmart and into retail. So, the mix of the business was growing a little bit faster, this most recent year in mass and in retail, um, the price point is premium, which gives it the ability to make it margin accretive. And as you might imagine, there is a Synergy case here given that this is in sauces. And it's
It's a really, an amazing product, and an amazing brand, uh, it's an authentic founder story. It's great tasting, clean, label. And what we love about this product, um, Todd, is that when you look at it it's significantly over indexes with Millennials and gen Z so it does well with with all of the various cohorts. But if you look at sort of the future of food consumption and these are people that love their sauces, it does particularly well with those cohorts
David A. Ciesinski: It plays in sauces, it plays in marinades, it plays in glazes, even plays in dips. We tested all of these items. It gave us reason to believe that this could be a very meaningful brand platform for us. And as we talked to, you know, Justin Gill, the founder of the business, and his team, really what we focused on was the fact that we believe we have best in industry, culinary, and product development capabilities. We can't develop everything, but when it comes to sauces, dips, and flavor systems, we believe that we really have, you know, top of the peer group capabilities. And I think that became part of a selling point for our partnership together. Now, as you pointed out, you know, the business did $87 million in sales, strong growth rate.
It plays in sauces, it plays in marinades, it plays in glazes, even plays in dips. We tested all of these items. It gave us reason to believe that this could be a very meaningful brand platform for us. And as we talked to, you know, Justin Gill, the founder of the business, and his team, really what we focused on was the fact that we believe we have best in industry, culinary, and product development capabilities. We can't develop everything, but when it comes to sauces, dips, and flavor systems, we believe that we really have, you know, top of the peer group capabilities. And I think that became part of a selling point for our partnership together. Now, as you pointed out, you know, the business did $87 million in sales, strong growth rate.
And uh that in conjunction with the fact that the brand has very broad shoulders, it plays in sauces plays in marinades plays in uh, glazes even plays in dips. We tested all of these items it gave us reason to believe that this could be a, a very meaningful brand platform for us.
David Ciesinski: So, and I'm gonna give you a little inside baseball for those listening. We literally signed this last night. We had been following this business for four years. We have participated in the process. We've been diligencing it for months, but literally, we signed last night, so it's relatively fresh news. And we'd like to come back to you with a more complete story for how we intend to grow the business and, and outline for you the synergy case and, and everything else. But suffice it to say, if you look at us, our history really started in dressings, and our most recent chapter of growth in sauces has come by way of brands that we've licensed, and we love those brands. That being said, we've always wanted brand platforms that we could own, that we could also grow, so we could have multiple pathways to growth.
David Ciesinski: So, and I'm gonna give you a little inside baseball for those listening. We literally signed this last night. We had been following this business for four years. We have participated in the process. We've been diligencing it for months, but literally, we signed last night, so it's relatively fresh news. And we'd like to come back to you with a more complete story for how we intend to grow the business and, and outline for you the synergy case and, and everything else. But suffice it to say, if you look at us, our history really started in dressings, and our most recent chapter of growth in sauces has come by way of brands that we've licensed, and we love those brands. That being said, we've always wanted brand platforms that we could own, that we could also grow, so we could have multiple pathways to growth.
It's really our our wheelhouse to be able to support this business. So overall you you bring it all together authentic founder story, great tasting product, aligned with where consumers are going GOP, friendly it. It really just made a lot of a sense for us. So a very, very exciting, um, item here. So and I'm going to give you a little inside baseball. For those listening, we literally signed this last night. We had been following this business for 4 years.
Uh, we had participated in the process. We've been diligent in it for months but literally we signed last night. So it's relatively fresh news and we'd like to come back to you with a more complete story for how we intend to grow the business and, and outline for you, the Synergy case and and everything else. But suffice it to say, if you look at us, our history really started in dressing,
David A. Ciesinski: If you look at the history of the business, it grew principally through Costco, and then began to diversify into mass with Walmart and into retail. So the mix of the business was growing a little bit faster this most recent year in mass and in retail. The price point is premium, which gives us the ability to make it margin accretive. And as you might imagine, there is a synergy case here, given that this is in sauces, and it's really our wheelhouse to be able to support this business. So overall, you bring it all together, authentic founder story, great tasting product, aligned with where consumers are going, GLP friendly. It really just made a lot of sense for us. So a very, very exciting item here.
If you look at the history of the business, it grew principally through Costco, and then began to diversify into mass with Walmart and into retail. So the mix of the business was growing a little bit faster this most recent year in mass and in retail. The price point is premium, which gives us the ability to make it margin accretive. And as you might imagine, there is a synergy case here, given that this is in sauces, and it's really our wheelhouse to be able to support this business. So overall, you bring it all together, authentic founder story, great tasting product, aligned with where consumers are going, GLP friendly. It really just made a lot of sense for us. So a very, very exciting item here.
David Ciesinski: Our legacy brands, Marzetti, Sister Schubert’s, and New York, these amazing, highly relevant restaurant brands, but then over time, in the right circumstances, to add additional brands that we think are consumer relevant for the future, that we could own and help grow. So for us, it really checks all of those boxes.
David Ciesinski: Our legacy brands, Marzetti, Sister Schubert’s, and New York, these amazing, highly relevant restaurant brands, but then over time, in the right circumstances, to add additional brands that we think are consumer relevant for the future, that we could own and help grow. So for us, it really checks all of those boxes.
And our most recent chapter of growth in sauces is come by way of brands that we've licensed and we love those brands. That being said, we've always wanted brand platforms that we could own that we could also grow. So we could have multiple Pathways to grow our, our Legacy Brands, Marzetti sister, Schubert and New York. These amazing highly relevant restaurant Brands. But then over time and the right circumstances to add additional brands that we think are consumer relevant for the future that we could own and help grow. So for us, it, it really checks all of those boxes.
Todd Brooks: That's amazing. And one non-related follow-up, and I'll jump back in queue. Dave, if we think about the Texas Roadhouse Dinner Rolls, I think scanner data north of $20 million in the quarter. When you originally talked about the launch of the product, you thought this was the next $100 million offering within the licensed branded portfolio. As we look towards the back half, how do you think about exit run rates for this business, given that distribution continues to grow? And you've also talked about possible extensions with additional flavorings and things like that. Can you address that as well? And I'll jump back in queue. Thanks.
Todd Brooks: That's amazing. And one non-related follow-up, and I'll jump back in queue. Dave, if we think about the Texas Roadhouse Dinner Rolls, I think scanner data north of $20 million in the quarter. When you originally talked about the launch of the product, you thought this was the next $100 million offering within the licensed branded portfolio. As we look towards the back half, how do you think about exit run rates for this business, given that distribution continues to grow? And you've also talked about possible extensions with additional flavorings and things like that. Can you address that as well? And I'll jump back in queue. Thanks.
That's amazing and uh 1 non related follow-up and I'll Trump back in queue. Um Dave if we think about the Texas Roadhouse
David A. Ciesinski: So now I'm gonna give you a little inside baseball for those listening. We literally signed this last night. We had been following this business for four years. We had participated in the process. We've been diligencing it for months, but literally, we signed last night, so it's relatively fresh news. We'd like to come back to you with a more complete story for how we intend to grow the business, and outline for you the synergy case, and everything else. But suffice it to say, if you look at us, our history really started in dressings, and our most recent chapter of growth in sauces has come by way of brands that we've licensed, and we love those brands. That being said, we've always wanted brand platforms that we could own, that we could also grow, so we could have multiple pathways to growth.
So now I'm gonna give you a little inside baseball for those listening. We literally signed this last night. We had been following this business for four years. We had participated in the process. We've been diligencing it for months, but literally, we signed last night, so it's relatively fresh news. We'd like to come back to you with a more complete story for how we intend to grow the business, and outline for you the synergy case, and everything else. But suffice it to say, if you look at us, our history really started in dressings, and our most recent chapter of growth in sauces has come by way of brands that we've licensed, and we love those brands. That being said, we've always wanted brand platforms that we could own, that we could also grow, so we could have multiple pathways to growth.
Great. Yeah, if you look at the history of the business, it it grew principally through Costco and then began to diversify into Mass, uh, into um, with Walmart and into retail. So, the mix of the business was growing a little bit faster, this most recent year in mass and in retail, um, the price point is premium, which gives it the ability to make it margin accretive. And as it might imagine, there is a Synergy case here given that this is in sauces and it's it's really our our wheelhouse to be able to support this business. So overall you you bring it all together authentic founder story, great tasting product, aligned with where consumers are going GOP, friendly it. It really just made a lot of a sense for us. So a very, very exciting, um, item here. So and I'm going to give you a little inside baseball. For those listening, we literally signed this last night. We had been following this business for 4.
Dinner rolls, I think scanner data, north of 20 million and a quarter. When you originally talked about the launch of the product, you thought this was the next hundred million dollar, uh, offering within the licensed branded portfolio. As we look towards the back half, how do you think about exit run rates for this business? Given the distribution continues to grow and
David Ciesinski: Yeah, I'd be happy to, and thank you for asking. The business continues to maintain that same growth rate. If you look at it, you pointed out the most recent period, we exited at about a 20%, $20 million run rate. Actually, the 5-week was better than the 13-week. And I think there's still room for us to continue to dial in the merchandising on the shelf and a range of other things. Parenthetically, yesterday I was on the phone with the team at Texas Roadhouse, and we were talking about partnership and how mutually excited we are about the whole thing. And we were also talking about other items that are in the pipeline.
David Ciesinski: Yeah, I'd be happy to, and thank you for asking. The business continues to maintain that same growth rate. If you look at it, you pointed out the most recent period, we exited at about a 20%, $20 million run rate. Actually, the 5-week was better than the 13-week. And I think there's still room for us to continue to dial in the merchandising on the shelf and a range of other things. Parenthetically, yesterday I was on the phone with the team at Texas Roadhouse, and we were talking about partnership and how mutually excited we are about the whole thing. And we were also talking about other items that are in the pipeline.
Four years. Uh, we had participated in the process. We've been diligent in it for months, but literally, we signed last night. So it's relatively fresh news, and we'd like to come back to you with a more complete story for how we intend to grow the business and outline for you the synergy case and everything else. But suffice it to say, if you look at us, our history really started in dressing,
David A. Ciesinski: Our legacy brands, Marzetti, Sister Schubert's, and New York, these amazing, highly relevant restaurant brands, but then over time, in the right circumstances, to add additional brands that we think are consumer relevant for the future, that we could own and help grow. So for us, it really checks all of those boxes.
Our legacy brands, Marzetti, Sister Schubert's, and New York, these amazing, highly relevant restaurant brands, but then over time, in the right circumstances, to add additional brands that we think are consumer relevant for the future, that we could own and help grow. So for us, it really checks all of those boxes.
you've also talked about possible extensions with additional flavorings and things like that. Commute address that as well. And I'll jump back in queue. Thanks. Yeah. I I'd be happy to and thank you for asking the the business continues to maintain that that same growth rate. If you look at it, you pointed out most recent period, we exited about a 20% uh 20 million dollar run rate, actually, the 5 week was better than the 13 week, um, and I think there's still room for us to continue to dial in, uh, the merchandising on the shelf and uh, a range of other things.
And our most recent chapter of growth in sauces is come by way of brands that we've licensed and we love those brands. That being said, we've always wanted brand platforms that we could own that we could also grow. So we could have multiple Pathways to grow our, our Legacy Brands, Marzetti sister, Schubert and New York. These amazing highly relevant restaurant Brands. But then over time in the right circumstances to add additional brands that we think are consumer relevant for the future that we can own and help grow. So for us, it, it really checks all of those boxes.
[Analyst] (Benchmark Company): That's amazing. And, one non-related follow-up, and I'll jump back in queue. Dave, if we think about the Texas Roadhouse Dinner Rolls, I think scanner data north of $20 million in the quarter. When you originally talked about the launch of the product, you thought this was the next $100 million offering within the licensed branded portfolio. As we look towards the back half, how do you think about exit run rates for this business, given that distribution continues to grow? And you've also talked about possible extensions with additional flavorings and things like that. Can you address that as well? And I'll jump back in queue. Thanks.
Todd Brooks: That's amazing. And, one non-related follow-up, and I'll jump back in queue. Dave, if we think about the Texas Roadhouse Dinner Rolls, I think scanner data north of $20 million in the quarter. When you originally talked about the launch of the product, you thought this was the next $100 million offering within the licensed branded portfolio. As we look towards the back half, how do you think about exit run rates for this business, given that distribution continues to grow? And you've also talked about possible extensions with additional flavorings and things like that. Can you address that as well? And I'll jump back in queue. Thanks.
David Ciesinski: So you know, you get to the end of our fiscal year. I think there's most certainly a case that this thing could be working towards a retail $100 million run rate. And this is an amazing brand. It's, it's really one of those away-from-home brands that really connects with consumers in a good economy and in a tough economy. And we feel like we're uniquely suited to work with them and their iconic roll platform to grow the business.
David Ciesinski: So you know, you get to the end of our fiscal year. I think there's most certainly a case that this thing could be working towards a retail $100 million run rate. And this is an amazing brand. It's, it's really one of those away-from-home brands that really connects with consumers in a good economy and in a tough economy. And we feel like we're uniquely suited to work with them and their iconic roll platform to grow the business.
That's amazing, and uh, one non-related follow-up, and I'll jump back in the queue. Um, Dave, if we think about the Texas Roadhouse,
Parenthetically yesterday I I was on the phone with the team at Texas Roadhouse and and we were talking about partnership and how mutually excited we are about the the whole thing, and we were also talking about other items that are in the pipeline. So, you know, you get to the end of our fiscal year. I think there's most certainly a case that this thing can be working towards a retail hundred million dollar run rate and this is an amazing brand. It's it's really 1 of those away from home brands.
That really connects with consumers in a good economy and in a tough economy. And, uh, we feel like we're uniquely suited to work with them and their iconic, uh, role platform to, to grow the business.
That's great. Thanks Dave.
Thank you.
Todd Brooks: That's great. Thanks, Dave.
Todd Brooks: That's great. Thanks, Dave.
General roles, I think scanner data north of 20 million in the quarter. When you originally talked about the launch of the product, you thought this was the next hundred million dollar, uh, offering within the licensed branded portfolio. As we look towards the back half, how do you think about exit run rates for this business? Given the distribution continues to grow and
David Ciesinski: Thank you.
David Ciesinski: Thank you.
Todd Brooks: Thanks, Tom.
Todd Brooks: Thanks, Tom.
Operator: Thank you. Your next question comes from the line of Alton Stump from Loop Capital. Your line is now open.
Operator: Thank you. Your next question comes from the line of Alton Stump from Loop Capital. Your line is now open.
Thank you. Your next question comes from the line of Alton stump from loop capital. Your line is now open.
David A. Ciesinski: Yeah, I'd be happy to, and thank you for asking. The business continues to maintain that same growth rate. If you look at it, you pointed out, most recent period, we exited at about a 20%... $20 million run rate. Actually, the 5-week was better than the 13-week. And I think there's still room for us to continue to dial in the merchandising on the shelf and a range of other things. Parenthetically, yesterday, I was on the phone with the team at Texas Roadhouse, and we were talking about partnership and how mutually excited we are about the whole thing. And we were also talking about other items that are in the pipeline.
Dave Ciesinski: Yeah, I'd be happy to, and thank you for asking. The business continues to maintain that same growth rate. If you look at it, you pointed out, most recent period, we exited at about a 20%... $20 million run rate. Actually, the 5-week was better than the 13-week. And I think there's still room for us to continue to dial in the merchandising on the shelf and a range of other things. Parenthetically, yesterday, I was on the phone with the team at Texas Roadhouse, and we were talking about partnership and how mutually excited we are about the whole thing. And we were also talking about other items that are in the pipeline.
Alton Stump: Great. Thanks, guys. Excuse me, taking my questions this morning. As always, you know, I guess first one is for Tom. You know, I wanted to ask, you know, with the $21 million in share buybacks, obviously, it's not a big number with, you know, where your balance sheet's at, but I believe it's the, biggest number, even on a full year basis, that you bought back in over a decade. So I guess, you know, anything to read from that as far as, you know, your appetite for, you know, buybacks going forward? Obviously, you just completed a, you know, sizable deal, so that probably, you know, has an impact. But just kind of what your thoughts are when it comes to buybacks going forward.
Alton Stump: Great. Thanks, guys. Excuse me, taking my questions this morning. As always, you know, I guess first one is for Tom. You know, I wanted to ask, you know, with the $21 million in share buybacks, obviously, it's not a big number with, you know, where your balance sheet's at, but I believe it's the, biggest number, even on a full year basis, that you bought back in over a decade. So I guess, you know, anything to read from that as far as, you know, your appetite for, you know, buybacks going forward? Obviously, you just completed a, you know, sizable deal, so that probably, you know, has an impact. But just kind of what your thoughts are when it comes to buybacks going forward.
You've also talked about possible extensions with additional flavorings and things like that. Can you address that as well? And I'll jump back into you. Thanks. Yeah. I I'd be happy to and thank you for asking the business continues to maintain that that same growth rate. If you look at it, you pointed out most recent period, we exited about a 20%, 20 million dollar run rate, actually the 5 week was better than the 13th. Um and I think there's still room for us to continue to dial in uh, the merchandising on the shelf and uh, a range of other things.
Thomas Pigott: Yeah. So, great question. So, you know, obviously, with the stock trading off and, and with the rest of the sector, you know, we felt opportunistically there was an opportunity to buy back. So we executed a limited number of buybacks during the quarter. Now, as you've mentioned, we're levering that balance sheet against the acquisition of Bachan’s, which, you know, as Dave articulated, will be tremendously positive for our financials over time. So I think at this time, it's safe to say we'll kind of go back to our traditional approach on buybacks. That said, on the dividend policy, we-
Thomas Pigott: Yeah. So, great question. So, you know, obviously, with the stock trading off and, and with the rest of the sector, you know, we felt opportunistically there was an opportunity to buy back. So we executed a limited number of buybacks during the quarter. Now, as you've mentioned, we're levering that balance sheet against the acquisition of Bachan’s, which, you know, as Dave articulated, will be tremendously positive for our financials over time. So I think at this time, it's safe to say we'll kind of go back to our traditional approach on buybacks. That said, on the dividend policy, we-
David A. Ciesinski: So you know, you get to the end of our fiscal year. I think there's most certainly a case that this thing could be working towards a retail $100 million run rate. And this is an amazing brand. It's, it's really one of those away from home brands that really connects with consumers in a good economy and in a tough economy. And we feel like we're uniquely suited to work with them and their iconic roll platform to grow the business.
So you know, you get to the end of our fiscal year. I think there's most certainly a case that this thing could be working towards a retail $100 million run rate. And this is an amazing brand. It's, it's really one of those away from home brands that really connects with consumers in a good economy and in a tough economy. And we feel like we're uniquely suited to work with them and their iconic roll platform to grow the business.
Parathe yesterday I I was on the phone with the team at Texas Roadhouse and and we were talking about partnership and how mutually excited we are about the whole thing and we were also talking about other items that are in the pipeline. So, you know, you get to the end of our fiscal year. I think there's most certainly a case that this thing can be working towards a retail hundred million dollar run rate.
And this is an amazing brand. It's it's really 1 of those away from home brands that really connects with consumers in a good economy and in a tough economy. And, uh, we feel like we're uniquely suited to work with them and their iconic, uh, role platform to, to grow the business.
Even on a full year basis that you bought back and over a decade. So I guess, you know, anything to read from that. As far as you know, your appetite for, you know, buy basket with Ford, obviously you just completed a, you know, besides well deal. So that probably, you know, hasn't it back but just kind of what your thoughts are when it comes to BuyBacks. Yeah. So, uh, great question. So, you know, obviously with the stock trading off and and with the rest of the sector, um, you know, we felt opportunistically, there was an opportunity to buy back. Um, so we executed a limited number of BuyBacks during the quarter now. As you've mentioned, uh, we were Levering that balance sheet against um, the acquisition of bosons which, you know, is Dave, articulated will be tremendously, um, positive for our, our financials over time. So I think at this time, it's safe to say, We'll kind of go back to our traditional approach on BuyBacks. Um, that said, uh, on the dividend policy,
Operator: Thank you. Your next question comes from the line of Alton Stump from Loop Capital. Your line is now open.
Operator: Thank you. Your next question comes from the line of Alton Stump from Loop Capital. Your line is now open.
David Ciesinski: ... We continue to expect to grow it consistent with our history, even with this acquisition, given the very strong cash position the company has developed over time.
David Ciesinski: ... We continue to expect to grow it consistent with our history, even with this acquisition, given the very strong cash position the company has developed over time.
Thank you. Your next question comes from the line of Alton Stump from Loop Capital. Your line is now open.
[Analyst] (Loop Capital): Great. Thanks, guys, for taking my questions this morning. As always, you know, I guess first one is for Tom. You know, I wanted to ask, you know, with the $21, $21 million in share buybacks, obviously, it's not a big number with, you know, where your balance sheet's at, but I believe it's the, biggest number, even on a full year basis, that you bought back in over a decade. So I guess, you know, anything to read from that as far as, you know, your appetite for, you know-... buybacks going forward, obviously, you just completed a, you know, sizable deal, so that probably, you know, has an impact. But just kind of what your thoughts are when it comes to buybacks?
Alton Stump: Great. Thanks, guys, for taking my questions this morning. As always, you know, I guess first one is for Tom. You know, I wanted to ask, you know, with the $21, $21 million in share buybacks, obviously, it's not a big number with, you know, where your balance sheet's at, but I believe it's the, biggest number, even on a full year basis, that you bought back in over a decade. So I guess, you know, anything to read from that as far as, you know, your appetite for, you know-... buybacks going forward, obviously, you just completed a, you know, sizable deal, so that probably, you know, has an impact. But just kind of what your thoughts are when it comes to buybacks?
We we uh continue to expect to to grow it. Uh consistent with our uh history. Um, even with this acquisition, given the very strong cash position, the company has developed over time.
Alton Stump: Understood. Makes sense. You know, and Dave, and, you know, take it for the color that you just signed this deal last night, so I'm sure there's gonna be some more information to come, you know, you know, on the opportunities as you kind of work through things. But, I think you mentioned that it grew, you know, 48% annually, you know, during 2022 to 2025. So clearly, and it was just established in, I think, 2019, I think I saw in the release. So, it's obviously a brand-new brand. I would think that there's a ton of distribution opportunities. You know, like you mentioned, that they've obviously, you know, had a lot of their growth in Costco and Walmart. So, you know-
Alton Stump: Understood. Makes sense. You know, and Dave, and, you know, take it for the color that you just signed this deal last night, so I'm sure there's gonna be some more information to come, you know, you know, on the opportunities as you kind of work through things. But, I think you mentioned that it grew, you know, 48% annually, you know, during 2022 to 2025. So clearly, and it was just established in, I think, 2019, I think I saw in the release. So, it's obviously a brand-new brand. I would think that there's a ton of distribution opportunities. You know, like you mentioned, that they've obviously, you know, had a lot of their growth in Costco and Walmart. So, you know-
Thomas Pigott: Yeah. So, great question. So, you know, obviously with the stock trading off and with the rest of the sector, you know, we felt opportunistically there was an opportunity to buy back. So we executed a limited number of buybacks during the quarter. Now, as you've mentioned, we're levering that balance sheet against the acquisition of Bachan's, which, you know, as Dave articulated, will be tremendously positive for our financials over time. So I think at this time, it's safe to say we'll kind of go back to our traditional approach on buybacks. That said, on the dividend policy, we continue to expect to grow it consistent with our history, even with this acquisition, given the very strong cash position the company has developed over time.
Tom Pigott: Yeah. So, great question. So, you know, obviously with the stock trading off and with the rest of the sector, you know, we felt opportunistically there was an opportunity to buy back. So we executed a limited number of buybacks during the quarter. Now, as you've mentioned, we're levering that balance sheet against the acquisition of Bachan's, which, you know, as Dave articulated, will be tremendously positive for our financials over time. So I think at this time, it's safe to say we'll kind of go back to our traditional approach on buybacks. That said, on the dividend policy, we continue to expect to grow it consistent with our history, even with this acquisition, given the very strong cash position the company has developed over time.
Great. Thanks, guys. Excuse me. Take my questions morning. Uh, as always uh, you know, I guess, first 1 is for Tom. Uh, you know, I want to ask, you know what, the 20 minutes 21 million dollars in share BuyBacks. Obviously, it's not a big number with you know, where your balance sheet debt, but I believe is the biggest number even on a full year basis that you bought back and over a decade. So I guess, you know, anything to read from that. As far as you know, your appetite for, you know, buy Basket forward. Obviously you just completed a, you know, besides well deal. So that probably, you know, hasn't it back but just kind of what your thoughts are when it comes to buy back. Yeah.
Understood makes sense. Uh you know and Dave and you know thank you for the color that you just signed this deal last night. So I'm sure there's going to be some more information to come, uh, you know, you know on the opportunities as you kind of work through things. But, uh, I think you mentioned that, it grew, you know, 48% annually, uh, you know, during 20 to 2025 so, clearly, and we're just established in 1919. Like I said, in the release. So, um, it's obviously a brand new brand. I always think that there's a ton of distribution opportunities, like, you mentioned that they've obviously, you know, had a lot of their growth in Costco and Walmart. So, you know, just a high level of color on kind of what the, you know, distribution, you know, upside potential could look like
David Ciesinski: Yeah.
David Ciesinski: Yeah.
Alton Stump: Just high-level color on kind of what the, you know, distribution, you know, upside potential could look like.
Alton Stump: Just high-level color on kind of what the, you know, distribution, you know, upside potential could look like.
David Ciesinski: Yeah. Well, our early thinking on things as we get to know the business is maybe, first of all, this is a very, very capable team, very cohesive team, and our intention is to keep the team together and really augment them with our resources to help them grow, rather than to, you know, do anything other than that, really continue that momentum. As we think about how we intend to grow that, it's likely to come in three stages, where the first phase is going to be focused on really refining the distribution that they have in place. The second phase would come by driving new items that were in their pipeline and in our pipeline and really helping them execute those.
David Ciesinski: Yeah. Well, our early thinking on things as we get to know the business is maybe, first of all, this is a very, very capable team, very cohesive team, and our intention is to keep the team together and really augment them with our resources to help them grow, rather than to, you know, do anything other than that, really continue that momentum. As we think about how we intend to grow that, it's likely to come in three stages, where the first phase is going to be focused on really refining the distribution that they have in place. The second phase would come by driving new items that were in their pipeline and in our pipeline and really helping them execute those.
Yeah. Well our our early thinking on things as we we get to know the business is is maybe first of all
Change your buyback. Um so we executed a limited number of BuyBacks during the quarter. Now. As you've mentioned, uh, we were Levering that balance sheet against um the acquisition of bosons which, you know is Dave, articulated will be tremendously um, positive for our, our financials over time. So I think at this time, it's safe to say, We'll kind of go back to our traditional approach on BuyBacks. Um, that said, uh, on the dividend policy we we, uh, continued to expect to, to grow it. Uh, consistent with our, uh, history. Um, even with this acquisition, given the very strong cash position, the company has developed over time.
[Analyst] (Loop Capital): Understood. Makes sense. You know, and Dave, and, you know, thanks for the color that you just signed this deal last night, so I'm sure there's gonna be some more information to come, you know, you know, on the opportunities as you kind of work through things. But, I think you mentioned that it grew, you know, 48% annually, you know, during 2022 to 2025, so clearly... And it was just established in, I think, 2019, I think, initially. So, it's obviously a brand-new brand. I would think that there's a ton of distribution opportunities. You know, like you mentioned, that they've obviously, you know, had a lot of their growth in Costco and Walmart. So, you know-
Alton Stump: Understood. Makes sense. You know, and Dave, and, you know, thanks for the color that you just signed this deal last night, so I'm sure there's gonna be some more information to come, you know, you know, on the opportunities as you kind of work through things. But, I think you mentioned that it grew, you know, 48% annually, you know, during 2022 to 2025, so clearly... And it was just established in, I think, 2019, I think, initially. So, it's obviously a brand-new brand. I would think that there's a ton of distribution opportunities. You know, like you mentioned, that they've obviously, you know, had a lot of their growth in Costco and Walmart. So, you know-
This is a a very, very capable team very cohesive team and Our intention is to keep the team together and really augment them with our resources to help them grow rather than to to to, you know, do anything. Other than that really continue that momentum as as we think about how we intend to grow that. It's, it's like going to come in 3 stages, where the first phase is going to be focused on really refining the distribution that they have in place. The second phase would come by driving new items that were in their Pipeline and, and our Pipeline and really helping them, uh, execute those. And then, the third phase would be
David Ciesinski: And then the third phase would be extending them even more into broader adjacencies with new items. So this is a brand that, that plays most certainly well in the United States. We've seen it. And it's also a brand that, that we believe could play in a very meaningful way in Canada, if not other countries, beyond. The last thing that I'll, I'll point to is, if we look at this, one of the things that the, the business that, that really impressed us is when you look at the velocities of these items, the velocities are, are really remarkable. And the other thing that we saw that we really liked about it is the Net Promoter Score, which is, you know, that ratio of positive feedback to negative feedback.
David Ciesinski: And then the third phase would be extending them even more into broader adjacencies with new items. So this is a brand that, that plays most certainly well in the United States. We've seen it. And it's also a brand that, that we believe could play in a very meaningful way in Canada, if not other countries, beyond. The last thing that I'll, I'll point to is, if we look at this, one of the things that the, the business that, that really impressed us is when you look at the velocities of these items, the velocities are, are really remarkable. And the other thing that we saw that we really liked about it is the Net Promoter Score, which is, you know, that ratio of positive feedback to negative feedback.
David A. Ciesinski: Yeah.
Dave Ciesinski: Yeah.
[Analyst] (Loop Capital): Give just high-level color on kind of what the, you know, distribution, you know, upside potential could look like.
Alton Stump: Give just high-level color on kind of what the, you know, distribution, you know, upside potential could look like.
David A. Ciesinski: Yeah. Well, our early thinking on things as we get to know the business is maybe, first of all, this is a very, very capable team, very cohesive team, and our intention is to keep the team together and really augment them with our resources to help them grow, rather than to, you know, do anything other than that, really continue that momentum. As we think about how we intend to grow that, it's likely to come in three stages, where the first phase is going to be focused on really refining the distribution that they have in place. The second phase would come by driving new items that were in their pipeline and in our pipeline, and really helping them execute those.
Dave Ciesinski: Yeah. Well, our early thinking on things as we get to know the business is maybe, first of all, this is a very, very capable team, very cohesive team, and our intention is to keep the team together and really augment them with our resources to help them grow, rather than to, you know, do anything other than that, really continue that momentum. As we think about how we intend to grow that, it's likely to come in three stages, where the first phase is going to be focused on really refining the distribution that they have in place. The second phase would come by driving new items that were in their pipeline and in our pipeline, and really helping them execute those.
Understood makes sense. Uh, you know, and Dave and you know, thank you for the color that you just signed to steal last night. So I'm sure there's going to be some more information to come, uh, you know, you know on the opportunities as you kind of work through things. But uh, I think you mentioned that it grew, you know, 48% annually, uh, you know, during 20 to 2025 so clearly and we're just established in 1949 except in the release. So um, it's obviously a brand new brand. I always think that there's a ton of distribution opportunities, you know, like you mentioned that they've obviously, you know, had a lot of growth in Costco and Walmart. So, you know, we've just a high level of color on kind of what's the, you know, distribution, you know, upside potential could look like
Yeah, well, our early thinking on things as we get to know the business is maybe, first of all...
David Ciesinski: And the Net Promoter Score on this brand was higher than virtually any other brand that we tested out there, including many of the most popular items that the industry has talked about most recently, whether in sauces or even in other categories. So the setup here is very, very positive.
David Ciesinski: And the Net Promoter Score on this brand was higher than virtually any other brand that we tested out there, including many of the most popular items that the industry has talked about most recently, whether in sauces or even in other categories. So the setup here is very, very positive.
that that really impressed us is when you look at the philosophies of these items, the velocities are are really remarkable. And the other thing that we saw that we really liked about it is the net promoter score, which is, you know, that ratio of positive feedback to negative feedback and the net promoter score on this brand was higher than virtually. Any other brand that we tested out their con including many of the the most popular items that the industry has talked about most recently whether in sauces or even in in other categories. So the setup here is is very, very positive.
Interesting. Well some great caller. Thank you so much. Dave and Tom I'll hop back in the queue.
Thank you.
Alton Stump: Interesting. Well, some great color. Thank you so much, Dave and Tom. I'll hop back in the queue.
Alton Stump: Interesting. Well, some great color. Thank you so much, Dave and Tom. I'll hop back in the queue.
David Ciesinski: Thank you.
David Ciesinski: Thank you.
Thank you. Your next question comes from the line of Brian. Holland from da Davidson your line is now open.
Operator: Thank you. Your next question comes from the line of Brian Holland from D.A. Davidson. Your line is now open.
Operator: Thank you. Your next question comes from the line of Brian Holland from D.A. Davidson. Your line is now open.
David A. Ciesinski: And then the third phase would be extending them even more into broader adjacencies with new items. So this is a brand that, that plays most certainly well in the United States. We've seen it. And it's also a brand that, that we believe could play in a very meaningful way in Canada, if not other countries beyond. The last thing that I'll, I'll point to is, if we look at this, one of the things that the, the business that, that really impressed us is when you look at the velocities of these items, the velocities are, are really remarkable. And the other thing that we saw that we really liked about it is the Net Promoter Score, which is, you know, that ratio of positive feedback to negative feedback.
And then the third phase would be extending them even more into broader adjacencies with new items. So this is a brand that, that plays most certainly well in the United States. We've seen it. And it's also a brand that, that we believe could play in a very meaningful way in Canada, if not other countries beyond. The last thing that I'll, I'll point to is, if we look at this, one of the things that the, the business that, that really impressed us is when you look at the velocities of these items, the velocities are, are really remarkable. And the other thing that we saw that we really liked about it is the Net Promoter Score, which is, you know, that ratio of positive feedback to negative feedback.
Brian Holland: Yeah, thanks. Good morning. Maybe just sticking along with the Bachan’s acquisition. So when you make an acquisition like this, there's two factors to consider, the availability of, you know, a desirous asset. I'm talking about this from a timing perspective.
Brian Holland: Yeah, thanks. Good morning. Maybe just sticking along with the Bachan’s acquisition. So when you make an acquisition like this, there's two factors to consider, the availability of, you know, a desirous asset. I'm talking about this from a timing perspective.
Yeah, thanks. Good morning. Uh, maybe just, um, sticking along, uh, with the Bashon acquisition.
So,
David Ciesinski: Yeah.
David Ciesinski: Yeah.
Brian Holland: So the availability of a desirous asset and the preparedness of the acquirer to complete the acquisition. I think, Dave, as you and I have talked about, obviously, the market generally has some skepticism, a spotty M&A track record. You know, historically, I think it's fairly straightforward here. You know, looking backwards, some of those acquisitions were taking big swings. They were focused on addressable market expansion, et cetera. Big swings, at least from, you know, a new category standpoint, not necessarily size. This is right in your wheelhouse. So can you just kinda talk about why this... Less about the asset. We know about that, and we can dig into it-
Brian Holland: So the availability of a desirous asset and the preparedness of the acquirer to complete the acquisition. I think, Dave, as you and I have talked about, obviously, the market generally has some skepticism, a spotty M&A track record. You know, historically, I think it's fairly straightforward here. You know, looking backwards, some of those acquisitions were taking big swings. They were focused on addressable market expansion, et cetera. Big swings, at least from, you know, a new category standpoint, not necessarily size. This is right in your wheelhouse. So can you just kinda talk about why this... Less about the asset. We know about that, and we can dig into it-
This is a a very, very capable team very cohesive team and Our intention is to keep the team together and really augment them with our resources to help them grow rather than to to to, you know, do anything. Other than that really continue that momentum as as we think about how we intend to grow that it's likely to come in 3 stages, where the first phase is going to be focused on really refining the distribution that they have in place. The second phase would come by driving new items that were in their Pipeline and, and our Pipeline and really helping them, uh, execute those. And then, the third phase would be extending them. Even, uh, more in into broader adjacencies with new items. So, this is a brand that that plays most certainly well in the United States. We've seen it and it's also a brand that that we believe could play in a very meaningful way. In Canada, if not other countries are Beyond
When you make an acquisition like this, there's 2 factors to consider the availability of, you know, a desirous asset. I, I'm talking about this from a timing perspective so the availability of a desire is asset and the preparedness of the acquirer to complete the acquisition. Um,
The last thing that I'll point to is, if we look at this, one of the things that the business...
David A. Ciesinski: The Net Promoter Score on this brand was higher than virtually any other brand that we tested out there, including many of the most popular items that the industry has talked about most recently, whether in sauces or even in other categories. The setup here is very, very positive.
The Net Promoter Score on this brand was higher than virtually any other brand that we tested out there, including many of the most popular items that the industry has talked about most recently, whether in sauces or even in other categories. The setup here is very, very positive.
David Ciesinski: Oh.
Brian Holland: In just a second here.
David Ciesinski: Oh.
Brian Holland: In just a second here.
David Ciesinski: Yeah.
David Ciesinski: Yeah.
Brian Holland: But why now is the right time for Marzetti to be able to execute and integrate this asset in a way that it may not have been able to do five years ago?
Brian Holland: But why now is the right time for Marzetti to be able to execute and integrate this asset in a way that it may not have been able to do five years ago?
That that really impressed. Us is when you look at the velocities of these items, the velocities are are really remarkable. And the other thing that we saw that we really liked about it is the net promoter score, which is, you know, that ratio of positive feedback to negative feedback and the net promoter score on this brand was higher than virtually. Any other brand that we tested out there including many of the the most popular items that the industry has talked about most recently whether in sauces or even in in other categories. So the setup here is is very, very positive.
[Analyst] (Loop Capital): Interesting. Well, some great color. Thank you so much, Dave and Tom. I'll hop, hop back in the queue.
Alton Stump: Interesting. Well, some great color. Thank you so much, Dave and Tom. I'll hop, hop back in the queue.
Right in your wheelhouse. So can you just kind of talk about why this less about the asset? We know about that, we can dig into it just a second here. But but why now is the right time for Marzetti to be able to execute and integrate this asset in a way that it may not have been able to do 5 years ago?
Interesting. Well that's a great caller. Thank you so much, Dave and Tom, I'll hop back in the queue.
David A. Ciesinski: Thank you.
Dave Ciesinski: Thank you.
Thank you.
David Ciesinski: Yeah. No, it's... You know, Brian, I'm really glad you asked that question, and you followed us long enough and closely enough that I think really, you know, appreciate the journey that we've been on. And I, I think I would maybe talk to several things. Over the course of the last handful of years, we've really begun to narrow our focus into building end-to-end capabilities in sauces, dressings, and dips. Even when we think about our dough items, we think about the ability to stick flavor on top of those oftentimes. But focusing narrowly on sauces and dressings and dips, which is our core, this whole transformation has taken place in, in several steps. One has been going back and looking at our asset base to modernize those, to make sure that we can move from slower, less efficient filling lines to highly efficient, scalable manufacturing and filling lines.
David Ciesinski: Yeah. No, it's... You know, Brian, I'm really glad you asked that question, and you followed us long enough and closely enough that I think really, you know, appreciate the journey that we've been on. And I, I think I would maybe talk to several things. Over the course of the last handful of years, we've really begun to narrow our focus into building end-to-end capabilities in sauces, dressings, and dips. Even when we think about our dough items, we think about the ability to stick flavor on top of those oftentimes. But focusing narrowly on sauces and dressings and dips, which is our core, this whole transformation has taken place in, in several steps. One has been going back and looking at our asset base to modernize those, to make sure that we can move from slower, less efficient filling lines to highly efficient, scalable manufacturing and filling lines.
Thomas Pigott: Thank you.
Tom Pigott: Thank you.
Operator: Thank you. Your next question comes from the line of Brian Holland from D.A. Davidson. Your line is now open.
Operator: Thank you. Your next question comes from the line of Brian Holland from D.A. Davidson. Your line is now open.
Thank you. Your next question comes from the line of Brian Holland from D.A. Davidson. Your line is now open.
[Analyst] (D.A. Davidson): Yeah, thanks. Good morning. Maybe just sticking along with the Bachan's acquisition. So when you make an acquisition like this, there's two factors to consider: the availability of, you know, a desirous asset. I'm talking about this from a timing perspective.
Brian Holland: Yeah, thanks. Good morning. Maybe just sticking along with the Bachan's acquisition. So when you make an acquisition like this, there's two factors to consider: the availability of, you know, a desirous asset. I'm talking about this from a timing perspective.
Yeah, thanks. Good morning. Uh, may maybe just, um, sticking along, uh, with the Bashon acquisition.
So,
No. Its, you know, Brian, I'm really glad you asked that question and you followed us long enough and closely enough. So I think really, you know, appreciate the journey that we've been on. And I, I think I would maybe talked to several things over the course of the last handful of years. We've really begun to narrow our focus into building into to end capabilities and sauces dressings and dips.
David A. Ciesinski: Yeah.
Dave Ciesinski: Yeah.
[Analyst] (D.A. Davidson): So the availability of a desirous asset and the preparedness of the acquirer to complete the acquisition. I think, Dave, as you and I have talked about, obviously, the market generally has some skepticism, a spotty M&A track record. You know, historically, I think it's fairly straightforward here. You know, looking backwards, some of those acquisitions were taking big swings. They were focused on addressable market expansion, et cetera. Big swings, at least from, you know, a new category standpoint, not necessarily size. This is right in your wheelhouse. So can you just kind of talk about why this... Less about the asset. We know about that, and we can dig into it-
Brian Holland: So the availability of a desirous asset and the preparedness of the acquirer to complete the acquisition. I think, Dave, as you and I have talked about, obviously, the market generally has some skepticism, a spotty M&A track record. You know, historically, I think it's fairly straightforward here. You know, looking backwards, some of those acquisitions were taking big swings. They were focused on addressable market expansion, et cetera. Big swings, at least from, you know, a new category standpoint, not necessarily size. This is right in your wheelhouse. So can you just kind of talk about why this... Less about the asset. We know about that, and we can dig into it-
Even when we think about our dough items, we think about the ability to stick flavor on top of those often times. But focusing narrowly on sauces and dressings and dips which is our core, this whole transformation has taken place in in several steps.
When you make an acquisition like this, there's 2 factors to consider the availability of, you know, a desirous asset. I I I'm talking about this from a timing perspective so the availability of a desire is asset and the preparedness of the acquirer to complete the acquisition. Um,
David Ciesinski: And that was played out with Horse Cave. It was played out with some of the other smaller expansions, and it was also played out with the most recent acquisition that we did at College Park. As we worked our way through that, as you're aware, we looked at assets to buy, but the prices didn't make sense or the asset didn't make sense for what we were trying to achieve. And instead, we leaned into another inorganic growth pathway, which for us has been licensing. And we've added, as you know, over that period of time, you know, I'm guessing $400 million plus or so of profitable revenue by way of that licensing arm. You continue to move forward with that. We had an antiquated IT infrastructure system.
David Ciesinski: And that was played out with Horse Cave. It was played out with some of the other smaller expansions, and it was also played out with the most recent acquisition that we did at College Park. As we worked our way through that, as you're aware, we looked at assets to buy, but the prices didn't make sense or the asset didn't make sense for what we were trying to achieve. And instead, we leaned into another inorganic growth pathway, which for us has been licensing. And we've added, as you know, over that period of time, you know, I'm guessing $400 million plus or so of profitable revenue by way of that licensing arm. You continue to move forward with that. We had an antiquated IT infrastructure system.
1 has been going back and looking at our asset based and modernized those to make sure that we could move from slower less efficient, filling lines to highly efficient scalable manufacturing, and filling lines and and that was played out with Horse Cave. It was played out with some of the other smaller expansions, and it was also played out with the most recent acquisition that we did at College Park.
David A. Ciesinski: Oh.
[Analyst] (D.A. Davidson): in just a second here.
Dave Ciesinski: Oh.
Brian Holland: in just a second here.
David A. Ciesinski: Yeah.
Dave Ciesinski: Yeah.
[Analyst] (D.A. Davidson): But why now is the right time for Marzetti to be able to execute and integrate this asset in a way that it may not have been able to do five years ago?
Brian Holland: But why now is the right time for Marzetti to be able to execute and integrate this asset in a way that it may not have been able to do five years ago?
David A. Ciesinski: Yeah. No, it's... You know, Brian, I'm really glad you asked that question, and you've followed us long enough and closely enough, so I think really, you know, appreciate the journey that we've been on. And I, I think I would maybe talk to several things. Over the course of the last handful of years, we've really begun to narrow our focus into building end-to-end capabilities in sauces, dressings, and dips. Even when we think about our dough items, we think about the ability to stick flavor on top of those oftentimes. But focusing narrowly on sauces and dressings and dips, which is our core, this whole transformation has taken place in, in several steps. One has been going back and looking at our asset base to modernize those, to make sure that we can move from slower, less efficient filling lines to highly efficient, scalable manufacturing and filling lines.
Dave Ciesinski: Yeah. No, it's... You know, Brian, I'm really glad you asked that question, and you've followed us long enough and closely enough, so I think really, you know, appreciate the journey that we've been on. And I, I think I would maybe talk to several things. Over the course of the last handful of years, we've really begun to narrow our focus into building end-to-end capabilities in sauces, dressings, and dips. Even when we think about our dough items, we think about the ability to stick flavor on top of those oftentimes. But focusing narrowly on sauces and dressings and dips, which is our core, this whole transformation has taken place in, in several steps. One has been going back and looking at our asset base to modernize those, to make sure that we can move from slower, less efficient filling lines to highly efficient, scalable manufacturing and filling lines.
I think Dave is you and I have talked about, obviously, the market generally has some skepticism spotty m&a, track record. Um, you know, historically I, I think it's fairly straightforward here, you know, Looking Backward some of those Acquisitions were, were taking big swings, they were focused on addressable Market expansion, Etc. Big swings at least from, you know, a new category standpoint, not necessarily size. This is right in your wheelhouse. So can you just kind of talk about why this less about the asset? We know about that, we can dig into it just a second here. But yeah, but why now is the right time for Marzetti to be able to execute and integrate this asset in a way that it may not have been able to do 5 years ago?
David Ciesinski: We had a COBOL-based system installed in 1994 that we tore out and replaced during COVID, and we went to really end-to-end SAP S/4HANA, all based in the cloud, all of our data in one place, in one data lake. So another element of modernization. So as we've worked to grow by way of organic activity and inorganic activity with licensing, we've also worked in earnest to strengthen our capabilities so we can get to a point where we feel like we have industry-leading culinary and product development capabilities, industry-leading manufacturing capabilities, and then industry-leading marketing and selling capabilities. So we're at a moment in time now where most of the infrastructure, let's call it remediation and rebuilding, is behind us, whether it's in the IT space or whether it's in the physical space.
David Ciesinski: We had a COBOL-based system installed in 1994 that we tore out and replaced during COVID, and we went to really end-to-end SAP S/4HANA, all based in the cloud, all of our data in one place, in one data lake. So another element of modernization. So as we've worked to grow by way of organic activity and inorganic activity with licensing, we've also worked in earnest to strengthen our capabilities so we can get to a point where we feel like we have industry-leading culinary and product development capabilities, industry-leading manufacturing capabilities, and then industry-leading marketing and selling capabilities. So we're at a moment in time now where most of the infrastructure, let's call it remediation and rebuilding, is behind us, whether it's in the IT space or whether it's in the physical space.
Appreciate the journey that we've been on. And I, I think I would maybe talked to several things over the course of the last handful of years. We really begun to narrow our focus into building end, to-end capabilities and sauces dressings. And dips.
As we worked our way through that, as you're aware, we looked at assets to buy. But the prices didn't make sense or the asset didn't make sense for what we were trying to achieve. And instead we we leaned into another inorganic growth pathway which for us has been licensing. And we've added as you know over that period of time, you know I'm guessing 400 million plus or so uh profitable Revenue by way of that licensing. Art, you continue to move forward with that. We had an Antiquated it infrastructure system. We we had a Kobalt based system installed in 1994 that we tore out and replaced during coid. And we went to really end to end sap s4hana all based in the cloud, all of with our data in 1 day in, in 1 day. So another element of modernization. So as we've worked to grow by way of organic activity and inorganic activity
Even when we think about our dough items we think about the ability to stick flavor on top of those oftentimes but focusing narrowly on sauces and dressings and dips which is our core, this whole transformation has taken place in in several steps.
David A. Ciesinski: That was played out with Horse Cave. It was played out with some of the other smaller expansions, and it was also played out with the most recent acquisition that we did at Cookeville. As we worked our way through that, as you're aware, we looked at assets to buy, but the prices didn't make sense or the asset didn't make sense for what we were trying to achieve. Instead, we leaned into another inorganic growth pathway, which for us has been licensing. We've added, as you know, over that period of time, you know, I'm guessing $400 million plus or so of profitable revenue by way of that licensing arm. We continue to move forward with that. We had an antiquated IT infrastructure system.
That was played out with Horse Cave. It was played out with some of the other smaller expansions, and it was also played out with the most recent acquisition that we did at Cookeville. As we worked our way through that, as you're aware, we looked at assets to buy, but the prices didn't make sense or the asset didn't make sense for what we were trying to achieve. Instead, we leaned into another inorganic growth pathway, which for us has been licensing. We've added, as you know, over that period of time, you know, I'm guessing $400 million plus or so of profitable revenue by way of that licensing arm. We continue to move forward with that. We had an antiquated IT infrastructure system.
One has been going back and looking at our asset base and modernizing those to make sure that we can move from slower, less efficient filling lines to highly efficient, scalable manufacturing and filling lines. And that was played out with Horse Cave, it was played out with some of the other smaller expansions, and it was also played out with the most recent acquisition that we did at College Park.
with licensing, we've also worked in Earnest to strengthen our capabilities. So we could get to a point where we feel like we have industry-leading culinary and product development capabilities, industry-leading manufacturing capabilities and then industry-leading marketing and selling capabilities. So we're at a moment in time now, where most of the infrastructure, let's call it remediation and rebuilding is behind us, whether it's in the it space or whether
David Ciesinski: It was a logical time with this experienced team to think about an acquisition. This acquisition, like you said, was just really right down the wheelhouse. It has combination on the asset now of a great founder story, clean label, great tasting product. You know, I could go on and on. The partner, you know, Justin Gill, and the team that he has built is really top flight. So you bring all that together, it really made us feel like this was the time for us to think really hard about this. If we get it at the right price to move forward, and we felt like this was the right price for us.
David Ciesinski: It was a logical time with this experienced team to think about an acquisition. This acquisition, like you said, was just really right down the wheelhouse. It has combination on the asset now of a great founder story, clean label, great tasting product. You know, I could go on and on. The partner, you know, Justin Gill, and the team that he has built is really top flight. So you bring all that together, it really made us feel like this was the time for us to think really hard about this. If we get it at the right price to move forward, and we felt like this was the right price for us.
Whether it's in the physical space and it was a logical time with this experience team to think about an acquisition. And this acquisition, like you said, was just really write down the Wheelhouse, it has combination on the asset now, of a great founder story, clean label,
As we worked our way through that, as you're aware, we looked at assets to buy. But the prices didn't make sense or the asset didn't make sense for what we were trying to achieve. And instead we we leaned into another inorganic growth pathway which for us has been licensing. And we've added as you know over that period of time, you know I'm guessing 400 million plus or so uh profitable Revenue by way of that licensing. Art, you continue to move forward with that. We had an Antiquated, it infrastructure,
David A. Ciesinski: We had a COBOL-based system installed in 1994 that we tore out and replaced during COVID, and we went to really end-to-end SAP S/4HANA, all based in the cloud, all with our data in one data lake. So another element of modernization. So as we've worked to grow by way of organic activity and inorganic activity with licensing, we've also worked in earnest to strengthen our capabilities so we could get to a point where we feel like we have industry-leading culinary and product development capabilities, industry-leading manufacturing capabilities, and then industry-leading marketing and selling capabilities. So we're at a moment in time now where most of the infrastructure, let's call it remediation and rebuilding, is behind us, whether it's in the IT space or whether it's in the physical space.
We had a COBOL-based system installed in 1994 that we tore out and replaced during COVID, and we went to really end-to-end SAP S/4HANA, all based in the cloud, all with our data in one data lake. So another element of modernization. So as we've worked to grow by way of organic activity and inorganic activity with licensing, we've also worked in earnest to strengthen our capabilities so we could get to a point where we feel like we have industry-leading culinary and product development capabilities, industry-leading manufacturing capabilities, and then industry-leading marketing and selling capabilities. So we're at a moment in time now where most of the infrastructure, let's call it remediation and rebuilding, is behind us, whether it's in the IT space or whether it's in the physical space.
Great tasting product. You know, I could go on and on and the partner, you know, Justin Gill and the team that he has built is really tough like so you bring all that together. It it really made us feel like this was the time for us to
think really hard about this and if we get it at the right price to move forward and we felt like this was the right price for us.
Brian Holland: Appreciate, as always, the thoughtful answer. And then forgive me if you referenced this earlier in your remarks, and I just missed it, but just curious on the integration, the cost synergy side, supply chain, et cetera. Are you—what can you offer immediately? I do these... Are they self-manufactured? Is this something you get to bring in-house? Obviously, the excitement, enthusiasm around growth would-
Brian Holland: Appreciate, as always, the thoughtful answer. And then forgive me if you referenced this earlier in your remarks, and I just missed it, but just curious on the integration, the cost synergy side, supply chain, et cetera. Are you—what can you offer immediately? I do these... Are they self-manufactured? Is this something you get to bring in-house? Obviously, the excitement, enthusiasm around growth would-
Appreciate it. As always the thoughtful answer and then forgive me if you've referenced this earlier in your remarks and I just missed it. But but just curious on the integration, the the cost Synergy side, supply chain, Etc. Um,
Hey, are you?
David Ciesinski: Yeah.
David Ciesinski: Yeah.
Brian Holland: you know, maybe need more capacity at some point. Is that something that-
Brian Holland: you know, maybe need more capacity at some point. Is that something that-
David Ciesinski: Yeah.
David Ciesinski: Yeah.
Brian Holland: You can offer immediately, or will that require some capital investment in a meaningful way to allow for that future growth runway?
Brian Holland: You can offer immediately, or will that require some capital investment in a meaningful way to allow for that future growth runway?
David A. Ciesinski: And it was a logical time with this experienced team to think about an acquisition. And this acquisition, like you said, was just really right down the wheelhouse. It has a combination on the asset now of a great founder story, clean label, great tasting product. You know, I could go on and on. And the partner, you know, Justin Gill and the team that he has built, is really top flight. So you bring all that together, it, it really made us feel like this was the time for us to think really hard about this. If we get it at the right price to move forward, and we felt like this was the right price for us.
And it was a logical time with this experienced team to think about an acquisition. And this acquisition, like you said, was just really right down the wheelhouse. It has a combination on the asset now of a great founder story, clean label, great tasting product. You know, I could go on and on. And the partner, you know, Justin Gill and the team that he has built, is really top flight. So you bring all that together, it, it really made us feel like this was the time for us to think really hard about this. If we get it at the right price to move forward, and we felt like this was the right price for us.
The system. We we had a Kobalt based system installed in 1994 that we tore out and replaced during coid. And we went to really end to end sap s4hana all based in the cloud, all of with our data in 1 day and in 1 day to Lake. So another element of modernization. So as we've worked to grow by way of organic activity and inorganic activity with licensing, we've also worked in Earnest to strengthen our capabilities. So we could get to a point where we feel like we have industry-leading culinary and product development capabilities, industry-leading manufacturing capabilities and then industry-leading marketing and selling capabilities. So we're at a moment in time now where most of the infrastructure, let's call it remediation and rebuilding is behind us whether it's in the it space or whether it's in the physical space. And it was a logical.
Is this something you get to bring in house? Obviously, the excitement, enthusiasm around growth would, you know, maybe need more capacity at some point. Is that something that you can um, uh, offer immediately or will that require some capital investment, um, in a meaningful way to to allow for that. Future growth Runway sure. So as it stands to to
Today, the business is co-pack 100%.
David Ciesinski: Sure.
David Ciesinski: Sure.
Brian Holland: Sure.
Brian Holland: Sure.
David Ciesinski: So as it stands today, the business is co-packed 100%. And obviously, that provides us with a pathway to integrate some of the manufacturing into our network. But this is one of those scenarios where we most certainly wanna go slow to go fast. We wanna make sure we understand the business. We wanna make sure we understand how to manufacture the business. They have a good co-pack partner that's out there right now, and the last thing we wanna do is to bugger this thing up. But as you think about over the longer arc of time, there is a strong case for synergies here throughout the supply chain, and then we talked about the growth synergy case as well.
David Ciesinski: So as it stands today, the business is co-packed 100%. And obviously, that provides us with a pathway to integrate some of the manufacturing into our network. But this is one of those scenarios where we most certainly wanna go slow to go fast. We wanna make sure we understand the business. We wanna make sure we understand how to manufacture the business. They have a good co-pack partner that's out there right now, and the last thing we wanna do is to bugger this thing up. But as you think about over the longer arc of time, there is a strong case for synergies here throughout the supply chain, and then we talked about the growth synergy case as well.
time with this experienced team to think about an acquisition, and this acquisition, like you said, was just really right down the wheelhouse. It has a combination, on the asset now, of a great founder story, clean label,
Great tasting product. You know, I could go on and on and the partner, you know, Justin Gillan, the team that he has built is really tough. Like so you bring all that together. It it really made us feel like this was the time for us to
Think really hard about this and if we get it at the right price to move forward and we felt like this was the right price for us.
[Analyst] (D.A. Davidson): Appreciate, as always, the thoughtful answer. And then forgive me if you've referenced this earlier in your remarks, and I just missed it, but just curious on the integration, the cost synergy side, supply chain, et cetera. Are you-- what can you offer immediately? Do these... Are they self-manufactured? Is this something you get to bring in-house? Obviously, the excitement, enthusiasm around growth would-
Brian Holland: Appreciate, as always, the thoughtful answer. And then forgive me if you've referenced this earlier in your remarks, and I just missed it, but just curious on the integration, the cost synergy side, supply chain, et cetera. Are you-- what can you offer immediately? Do these... Are they self-manufactured? Is this something you get to bring in-house? Obviously, the excitement, enthusiasm around growth would-
So but if you think about over the longer Arc of time, there there is a strong case for synergies here throughout the supply chain. And then we talked about the growth Synergy case as well.
Great. Thanks. I can leave it there.
Thank you. Thank you, thanks. Brian.
Brian Holland: Great, thanks. I can leave it there.
Brian Holland: Great, thanks. I can leave it there.
Appreciate, as always, the thoughtful answer—and then forgive me if you’ve referenced this earlier in your remarks and I just missed it. But I'm just curious on the integration, the cost synergy side, supply chain, etc.
Thank you. Thank you.
David Ciesinski: Thank you.
David Ciesinski: Thank you.
Brian Holland: Thank you. Thanks, Brian.
Brian Holland: Thank you. Thanks, Brian.
Are you?
Operator: Thank you. And our last question comes from the line of Jim Salera of Stephens. Your line is now open.
Operator: Thank you. And our last question comes from the line of Jim Salera of Stephens. Your line is now open.
And our last question comes from the line of Jim Solera of Stevens. Your line is now open.
Good morning. Thank you so much.
Jim Salera: Good. So, good morning. Thanks for taking our questions. I wanted to-
Jim Salera: Good. So, good morning. Thanks for taking our questions. I wanted to-
I wanted to Jim dig in a little bit.
David A. Ciesinski: Yeah
Dave Ciesinski: Yeah
[Analyst] (D.A. Davidson): ... you know, maybe need more capacity at some point. Is that something that you-
Brian Holland: ... you know, maybe need more capacity at some point. Is that something that you-
Good morning. I wanted to dig in a little bit if I could on.
David Ciesinski: Morning, Jim.
David Ciesinski: Morning, Jim.
David A. Ciesinski: Yeah
[Analyst] (D.A. Davidson): Can offer immediately, or will that require some capital investment in a meaningful way to allow for that future growth runway?
Dave Ciesinski: Yeah
Jim Salera: Good morning. I wanted to dig in a little bit, if I could, on Bachan’s potential on the margin side as we think about. You mentioned it’s 100% co-man. I assume that you have the capabilities in place to make this in one of your existing facilities. Is there any way you can frame up the opportunity for, you know, where the margins might come in, whether it’s relative to kind of your existing margins or if you have a specific-
Brian Holland: Can offer immediately, or will that require some capital investment in a meaningful way to allow for that future growth runway?
Jim Salera: Good morning. I wanted to dig in a little bit, if I could, on Bachan’s potential on the margin side as we think about. You mentioned it’s 100% co-man. I assume that you have the capabilities in place to make this in one of your existing facilities. Is there any way you can frame up the opportunity for, you know, where the margins might come in, whether it’s relative to kind of your existing margins or if you have a specific-
David A. Ciesinski: Sure. So as it stands today, the business is co-packed 100 percent. And obviously, that provides us with a pathway to integrate some of the manufacturing into our network. But this is one of those scenarios where we most certainly wanna go slow to go fast. We wanna make sure we understand the business. We wanna make sure we understand how to manufacture the business. They have a good co-pack partner that's out there right now, and the last thing we wanna do is to bugger this thing up. But as you think about over the longer arc of time, there is a strong case for synergies here throughout the supply chain, and then we talked about the growth synergy case as well.
Dave Ciesinski: Sure. So as it stands today, the business is co-packed 100 percent. And obviously, that provides us with a pathway to integrate some of the manufacturing into our network. But this is one of those scenarios where we most certainly wanna go slow to go fast. We wanna make sure we understand the business. We wanna make sure we understand how to manufacture the business. They have a good co-pack partner that's out there right now, and the last thing we wanna do is to bugger this thing up. But as you think about over the longer arc of time, there is a strong case for synergies here throughout the supply chain, and then we talked about the growth synergy case as well.
Bosch ons potential on the margin side, as we think about you mentioned, it's it's 100% command. Um, I assume that you have the capabilities in place to make this in 1 of your existing facilities.
Is there?
What can you offer immediately? I do these, are they self-manufactured, is this something you get to bring in house? Obviously the excitement enthusiasm around growth would, you know, maybe need more capacity at some point. Is that something that you can, um, uh, offer immediately or will that require some capital investment, um, in a meaningful way to, to allow for that, future growth Runway, sure. So, as it stands to today the business is coped 100%,
any way you can frame up the opportunity for you know where the margins might come in, whether it's relative to kind of your existing margins or if you have a specific number in mind,
David Ciesinski: Yeah
David Ciesinski: Yeah
Jim Salera: ... number in mind?
Jim Salera: ... number in mind?
David Ciesinski: Yeah. So, this is a very high-margin business. The product sells at a premium price point, justifiably, and the existing margins are accretive to our existing retail segment at gross margin. So we're starting off with a premium product, and as we look at it, we have opportunities not only in terms of utilizing our capabilities in manufacturing. Procurement, distribution is another drill site for us. So, this is gonna be immediately margin accretive to us at the gross margin level, with potential to add to that going forward.
David Ciesinski: Yeah. So, this is a very high-margin business. The product sells at a premium price point, justifiably, and the existing margins are accretive to our existing retail segment at gross margin. So we're starting off with a premium product, and as we look at it, we have opportunities not only in terms of utilizing our capabilities in manufacturing. Procurement, distribution is another drill site for us. So, this is gonna be immediately margin accretive to us at the gross margin level, with potential to add to that going forward.
And obviously that provides us with a pathway to integrate some of the manufacturing into our network but this is 1 of those scenarios where we most certainly want to go slow to go fast. We want to make sure we understand the business. We want to make sure we understand how to manufacture the business. They have a good Cod partner, that's out there right now and um the last thing we we want to do is to b***** this thing up so but as you think about over the longer Arc of time, there there is a strong case for synergies here throughout the supply chain. And then we talked about the growth Synergy case as well.
[Analyst] (D.A. Davidson): Great, thanks. I can leave it there.
Brian Holland: Great, thanks. I can leave it there.
Operator: Our last question comes from the line of Jim Salera of Stephens. Your line is now open.
Operator: Our last question comes from the line of Jim Salera of Stephens. Your line is now open.
Thank you. Thank you.
Yeah, so um this is a this is a very high margin business. Uh, the product sells at a premium price point, uh justifiably and uh the existing margins are creative to our existing retail, uh, segment at gross margin. So we're starting off with a premium product and, um, as as we look at it, we have opportunities not only in terms of utilizing our capabilities and Manufacturing procurement distribution, is another, uh, uh, drill side for us. So, um, this is going to be immediately margin and creative to us at the gross margin level with potential to add to that going forward.
[Analyst] (Stephens): Good. So good morning. Thanks for taking my question. I wanted to-
Jim Salera: Good. So good morning. Thanks for taking my question. I wanted to-
Good morning. Can you take another question?
And then I I wonder if
David A. Ciesinski: Morning, Jim.
Dave Ciesinski: Morning, Jim.
[Analyst] (Stephens): Good morning. I wanted to dig in a little bit, if I could, on Bachan's potential on the margin side as we think about. You mentioned it's 100% co-man. I assume that you have the capabilities in place to make this in one of your existing facilities. Is there any way you can frame up the opportunity for, you know, where the margins might come in, whether it's relative to kind of your existing margins or if you have a specific number in mind?
Jim Salera: Good morning. I wanted to dig in a little bit, if I could, on Bachan's potential on the margin side as we think about. You mentioned it's 100% co-man. I assume that you have the capabilities in place to make this in one of your existing facilities. Is there any way you can frame up the opportunity for, you know, where the margins might come in, whether it's relative to kind of your existing margins or if you have a specific number in mind?
I wanted to dig in a little bit.
Jim Salera: Then I wonder if you have any detail on, do they have any sales in food service right now? Because I know we've seen other brands do kind of collaborations with food service partners if they have a particularly unique-
Jim Salera: Then I wonder if you have any detail on, do they have any sales in food service right now? Because I know we've seen other brands do kind of collaborations with food service partners if they have a particularly unique-
Good morning. I wanted to dig in a little bit, if I could, on—
You have any detail on did? Did they have any sales in food service right now? Because I know we've seen other brands, do kind of collaborations with Food Service Partners that they have a particularly unique or kind of prominent sauce is, is that the possibility
David Ciesinski: Well-
David Ciesinski: Well-
Jim Salera: or kind of prominent sauce. Is that something-
Jim Salera: or kind of prominent sauce. Is that something-
David Ciesinski: Yeah
Jim Salera: That they do right now, or that's a possibility?
David Ciesinski: Yeah
Jim Salera: That they do right now, or that's a possibility?
Boson's potential on the margin side. As we think about, as you mentioned, it's 100% command. Um, I assume that you have the capabilities in place to make this in one of your existing facilities.
Is there?
David Ciesinski: No, it's a great question, and it's a great opportunity for us. Right now, they do a very limited amount with food service customers, and as we worked, you know, with them over the course of several meetings, we both felt like this is a really exciting opportunity where we obviously have great capabilities to help them work with national accounts. You know, ideally, if you can imagine a Bachan's barbecue sauce, a wing sauce of some sort, feels like a home run. So there's a range of opportunities there, potentially with national accounts that we would like to investigate. And also just, you know, opportunities up and down the street. This is a tabletop item that people also use to drizzle, particularly on bowls.
David Ciesinski: No, it's a great question, and it's a great opportunity for us. Right now, they do a very limited amount with food service customers, and as we worked, you know, with them over the course of several meetings, we both felt like this is a really exciting opportunity where we obviously have great capabilities to help them work with national accounts. You know, ideally, if you can imagine a Bachan's barbecue sauce, a wing sauce of some sort, feels like a home run. So there's a range of opportunities there, potentially with national accounts that we would like to investigate. And also just, you know, opportunities up and down the street. This is a tabletop item that people also use to drizzle, particularly on bowls.
No, it's a great question and it's a great opportunity for us right now. They do a very limited amount with food service customers and as we worked you know with them over the course of of several meetings. We both felt like this is a really exciting opportunity where we obviously have
any way you can frame up the opportunity for you know where the margins might come in, whether it's relative to kind of your existing margins or if you have a specific number in mind,
David A. Ciesinski: Yeah. So, this is a, this is a very high-margin business. The product sells at a premium price point, justifiably, and, the existing margins are accretive to our existing retail segment at gross margin. So we're starting off with a premium product, and, as we look at it, we have opportunities not only in terms of utilizing our capabilities in manufacturing. Procurement, distribution is another, drill site for us. So, this is gonna be immediately margin accretive to us at the gross margin level, with potential to add to that going forward.
Tom Pigott: Yeah. So, this is a, this is a very high-margin business. The product sells at a premium price point, justifiably, and, the existing margins are accretive to our existing retail segment at gross margin. So we're starting off with a premium product, and, as we look at it, we have opportunities not only in terms of utilizing our capabilities in manufacturing. Procurement, distribution is another, drill site for us. So, this is gonna be immediately margin accretive to us at the gross margin level, with potential to add to that going forward.
David Ciesinski: So there is a real food service opportunity here, and one of the things that I think that the team at Bachan’s liked about us was our food service reach.
David Ciesinski: So there is a real food service opportunity here, and one of the things that I think that the team at Bachan’s liked about us was our food service reach.
Great capabilities to help them work with national accounts, um, you know, ideally, if you can imagine a, uh, a boson's, uh, barbecue sauce, a wing sauce of some sort feels like a, a home run. So there's a range of opportunities there potentially with national accounts that we would like to investigate. And also just, you know, opportunities up and down the street. This is a tabletop item that people also use to drizzle particularly on Bowles. So there there is a real food service opportunity here and 1 of the things that I I think that the the team at bosons liked about us was our Our Food Service reach.
Jim Salera: Perfect. And then if I could just sneak in one quick, near-term question.
Jim Salera: Perfect. And then if I could just sneak in one quick, near-term question.
Yeah. So um this is a this is a very high margin business. Uh the product sells at a premium price point uh justifiably and uh the existing margins are created to our existing retail uh, segment at gross margin. So we're starting off with a premium product and um, as as we look at it, we have opportunities not only in terms of utilizing our capabilities and Manufacturing procurement distribution is another uh, uh, drill site for us. So um, this is going to be immediately margin and creative to uh set the gross margin level with potential to add to that going forward.
[Analyst] (Stephens): Then I wonder if you have any detail on... Do they have any sales in food service right now? Because I know we've seen other brands do kind of collaborations with food service partners if they have a particularly unique or kind of prominent sauce.
Jim Salera: Then I wonder if you have any detail on... Do they have any sales in food service right now? Because I know we've seen other brands do kind of collaborations with food service partners if they have a particularly unique or kind of prominent sauce.
David Ciesinski: Please.
David Ciesinski: Please.
Jim Salera: Just with all the moving pieces for Q3 with Easter getting pulled forward, and then Q3 is also going up against a negative comp in the year ago. I think sales were down, like, 3% in Q3 2025. Would it be reasonable to expect Q3 to be up kind of, you know, if we're thinking kind of 2% for the year, that Q3 would be, like, 3% to 4%, and then Q4 would be, you know, the balance of that to average 2% for the year? I just wanna make sure, you know, we're kind of getting the cadence right as we think about modeling over all the calendar changes and then the year-over-year comp lap.
Jim Salera: Just with all the moving pieces for Q3 with Easter getting pulled forward, and then Q3 is also going up against a negative comp in the year ago. I think sales were down, like, 3% in Q3 2025. Would it be reasonable to expect Q3 to be up kind of, you know, if we're thinking kind of 2% for the year, that Q3 would be, like, 3% to 4%, and then Q4 would be, you know, the balance of that to average 2% for the year? I just wanna make sure, you know, we're kind of getting the cadence right as we think about modeling over all the calendar changes and then the year-over-year comp lap.
Perfect and if I could just sneak in 1 quick uh near-term question please. Just just with all the moving pieces for 3Q with Easter getting pulled forward and then 3 Q is also going up against a negative comp in the year ago. I think sales were down like 3% and 3225.
Would it be reasonable to expect 3 Q to be up? Kind of
David A. Ciesinski: Yeah.
Dave Ciesinski: Yeah.
[Analyst] (Stephens): Is that something that they do right now, or it's a possibility?
Jim Salera: Is that something that they do right now, or it's a possibility?
David A. Ciesinski: No, it's a great question, and it's a great opportunity for us. Right now, they do a very limited amount with food service customers. As we worked, you know, with them over the course of several meetings, we both felt like this is a really exciting opportunity, where we obviously have great capabilities to help them work with national accounts. You know, ideally, if you can imagine a Bachan's barbecue sauce, a wing sauce of some sort, feels like a home run. So there's a range of opportunities there, potentially with national accounts that we would like to investigate. And also just, you know, opportunities up and down the street. This is a tabletop item that people also use to drizzle, particularly on bowls.
Dave Ciesinski: No, it's a great question, and it's a great opportunity for us. Right now, they do a very limited amount with food service customers. As we worked, you know, with them over the course of several meetings, we both felt like this is a really exciting opportunity, where we obviously have great capabilities to help them work with national accounts. You know, ideally, if you can imagine a Bachan's barbecue sauce, a wing sauce of some sort, feels like a home run. So there's a range of opportunities there, potentially with national accounts that we would like to investigate. And also just, you know, opportunities up and down the street. This is a tabletop item that people also use to drizzle, particularly on bowls.
And then I, I wonder if you have any detail on did. Do they have any sales in food service right now? Because I know we've seen other brands, do kind of collaborations with Food Service Partners that they have a particularly weak or kind of prominent sauce is, is that something that the possibility?
You know, if we're thinking kind of 2% for the year that 32 would be like 3 to 4 percent and then 42 would be, you know, the balance of that to average 2 for the year. I just want to make sure, you know, we're kind of getting the Cadence right as we think about modeling over all the the calendar changes and then the year-over-year collab.
No, it's a great question and it's a great opportunity for us right now. They do a very limited amount with food service customers and as we worked you know with them over the course of of several meetings. We've also like this is a really exciting opportunity where we obviously have
Thomas Pigott: Yeah, we have, for retail, we have low single-digit revenue growth for the second half. It actually is fairly even by quarter as forecasted today. Certainly, you know, we do have, while we have the Easter tailwind, we have some difficult new item launch comps in Q3 and in the club sector. So, you know, I would model it fairly even by quarter.
Thomas Pigott: Yeah, we have, for retail, we have low single-digit revenue growth for the second half. It actually is fairly even by quarter as forecasted today. Certainly, you know, we do have, while we have the Easter tailwind, we have some difficult new item launch comps in Q3 and in the club sector. So, you know, I would model it fairly even by quarter.
David A. Ciesinski: So there is a real food service opportunity here, and one of the things that I think that the team at Bachan's liked about us was our food service reach.
So there is a real food service opportunity here, and one of the things that I think that the team at Bachan's liked about us was our food service reach.
Yeah, we have, um, for a retail, we have low single digit Revenue growth for the second half. Uh, it, it actually, uh, is fairly even by quarter as forecasted today. Um, and uh, certainly, um, you know, we do have uh, while we have the Easter uh Tailwind, we have some difficult, um uh, new item launch comps in Q3 and uh, in the club in the club sector. So um, you know, I I would model it, uh, fairly even by quarter.
Okay.
Thanks Jim. Thanks Jim.
Great capabilities to help them work, with national accounts, um, you know, ideally, if you can imagine a, a, a Bosch ons, barbecue sauce, a wing sauce of some sort feels like a, a home run. So there's a range of opportunities there potentially with national accounts that we would like to investigate. And also just, you know, opportunities up and down the street, this is a tabletop item that people also use to drizzle particularly on both. So there, there is a real food service opportunity here and 1 of the things that I I think that the the team at bosons liked about us was our Our Food Service reach.
Jim Salera: Okay. Perfect. Thanks, guys. Appreciate the call.
Jim Salera: Okay. Perfect. Thanks, guys. Appreciate the call.
[Analyst] (Stephens): Perfect. And then if I could just sneak in one quick, near-term question.
Jim Salera: Perfect. And then if I could just sneak in one quick, near-term question.
Thomas Pigott: Thanks, Jim.
Thomas Pigott: Thanks, Jim.
Jim Salera: Thanks, Jim.
Jim Salera: Thanks, Jim.
David A. Ciesinski: Please.
Dave Ciesinski: Please.
[Analyst] (Stephens): Just with all the moving pieces for Q3, with Easter getting pulled forward, and then Q3 is also going up against a negative comp in the year ago, I think sales were down, like, 3% in Q3 2025. Would it be reasonable to expect Q3 to be up kind of, you know, if we're thinking kind of 2% for the year, that Q3 would be, like, 3% to 4%, and then Q4 would be, you know, the balance of that to average 2% for the year? I just wanna make sure, you know, we're kind of getting the cadence right as we think about modeling over all the calendar changes and then the year-over-year comp.
Jim Salera: Just with all the moving pieces for Q3, with Easter getting pulled forward, and then Q3 is also going up against a negative comp in the year ago, I think sales were down, like, 3% in Q3 2025. Would it be reasonable to expect Q3 to be up kind of, you know, if we're thinking kind of 2% for the year, that Q3 would be, like, 3% to 4%, and then Q4 would be, you know, the balance of that to average 2% for the year? I just wanna make sure, you know, we're kind of getting the cadence right as we think about modeling over all the calendar changes and then the year-over-year comp.
Perfect. And then if I could just sneak in 1 quick uh near-term question.
If there are no further questions, we will now turn the call back to Mr. Ciesinski, for his concluding comments,
Operator: If there are no further questions, we will now turn the call back to Mr. Ciesinski for his concluding comments.
Operator: If there are no further questions, we will now turn the call back to Mr. Ciesinski for his concluding comments.
Thomas Pigott: Well, thank you, operator, and thank you everyone for participating this morning. We look forward to sharing with you our third quarter results in May and giving you more exciting information about the acquisition of Bachan’s. Have a great rest of the day.
Thomas Pigott: Well, thank you, operator, and thank you everyone for participating this morning. We look forward to sharing with you our third quarter results in May and giving you more exciting information about the acquisition of Bachan’s. Have a great rest of the day.
Just with all the moving pieces for Q3, with Easter getting pulled forward. And then Q3 is also going up against a negative comp in the year ago. I think sales were down like 3% in Q3 '25.
Participating this morning we look forward to sharing with you our third quarter results in May and giving you more exciting information about the acquisition of Bashan, have a great rest of the day.
Would it be reasonable to expect Q3 to be up? Kind of.
Thank you for your participation. In today's conference, this does conclude the program. You may now disconnect
Operator: Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.
Operator: Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.
Thomas Pigott: Yeah, we have, for retail, we have low single-digit revenue growth for the second half. It actually is fairly even by quarter as forecasted today. Certainly, you know, we do have, while we have the Easter tailwind, we have some difficult new item launch comps in Q3 and in the club sector. So, you know, I would model it fairly even by quarter.
Tom Pigott: Yeah, we have, for retail, we have low single-digit revenue growth for the second half. It actually is fairly even by quarter as forecasted today. Certainly, you know, we do have, while we have the Easter tailwind, we have some difficult new item launch comps in Q3 and in the club sector. So, you know, I would model it fairly even by quarter.
you know, if we're thinking kind of 2% for the year that 32 would be like 3 to 4 percent and then 4 q would be, you know, the balance of that to average 2 for the year, I just want to make sure, you know, we're kind of getting the Cadence right as we think about modeling over all the the calendar changes and then the year-over-year could last
[Analyst] (Stephens): Okay. Perfect. Thanks, guys. Appreciate the call.
Jim Salera: Okay. Perfect. Thanks, guys. Appreciate the call.
Yeah, we have, um, for a retail, we have low single digit Revenue growth for the second half. Uh, it, it actually, uh, is fairly even by quarter as forecasted today. Um, and uh, certainly, um, you know, we do have uh, while we have the Easter uh Tailwind, we have some difficult, um uh, new item launch comps in Q3 and uh, in the club in the club sector. So um, you know, I I would model it, uh, fairly even by quarter.
Okay, perfect. Thanks guys.
David A. Ciesinski: Thanks, Jim.
Dave Ciesinski: Thanks, Jim.
Thomas Pigott: Thanks, Jim.
Tom Pigott: Thanks, Jim.
Thanks Jim. Thanks Jim.
Operator: If there are no further questions, we will now turn the call back to Mr. Ciesinski for his concluding comments.
Operator: If there are no further questions, we will now turn the call back to Mr. Ciesinski for his concluding comments.
If there are no further questions, we will now turn the call back to Mr. Sicinski for his concluding comments,
David A. Ciesinski: Well, thank you, operator, and thank you everyone for participating this morning. We look forward to sharing with you our Q3 results in May and giving you more exciting information about the acquisition of Bachan's. Have a great rest of the day.
Dave Ciesinski: Well, thank you, operator, and thank you everyone for participating this morning. We look forward to sharing with you our Q3 results in May and giving you more exciting information about the acquisition of Bachan's. Have a great rest of the day.
Well, thank you, operator, and thank you, everyone, for participating. This morning, we look forward to sharing with you our third quarter results in May and giving you more exciting information about the acquisition of Bosons. Have a great rest of the day.
Operator: Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.
Operator: Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.
Thank you for your participation. This does conclude today's conference program. You may now disconnect.