Lancaster Colony Corporation

Good morning, my name is Shannon and I will be your conference call facilitator today. At this time, I would like to welcome everyone to the Lancaster Colony Corporation fiscal year 2024 fourth quarter conference call. Conducting today's call will be Dave Sosinski, President and CEO, and Tom Pickett, CFO. Our 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, press star 1-1 again. Thank you. And now to begin the conference call, here is Dale Gnabczyk, Vice President of Corporate Finance and Investor Relations for Lancaster Colony Corporation.

Good morning, everyone, and thank you for joining us today for Lancaster Colony's fiscal year 2024 fourth 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 upon subsequent events. The 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 at our company's website, LancasterColony.com, later this afternoon. For today's call, Dave Szczesinski, our president and CEO, will begin with the business update and highlights for the quarter. Tom Piggott, 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 Lancaster Colony's President and CEO, Dave Susinski. Dave?

Thanks, Dale, and good morning, everyone. It's a pleasure to be here with you today as we review our fourth quarter results for fiscal year 2024. Before I provide my comments on our quarter, I am pleased to share that we completed fiscal year 2024 which ended June 30th with record net sales and gross profit. Net sales for the fiscal year grew 2.7% to $1.9 billion. Gross profit increased 11.3% to $432.3 million, and the resulting gross profit margin improved 180 basis points to 23.1%. Turning to our fiscal fourth quarter results, Consolidated net sales declined 40 basis points to $452.8 million, while gross profit grew 4.8% to $97.6 million. Operating income increased to $41.7 million, which includes the impact of restructuring and impairment charges that totaled $2.7 million in the current year quarter versus $25 million in last year's fourth quarter. All the restructuring and impairment charges are attributed to the perimeter of the store bakery product lines that we exited this past March. In our retail segment, net sales declined 80 basis points to $234.2 million. Excluding all sales associated with the perimeter bakery lines that we exited, retail segment sales increased 1.4%, while the segment's volume, measured in pound shift, increased 1.2%. Our successful licensing program remained a catalyst for growth in the retail segment. This was led by the newly introduced Subway sandwich sauces and Texas Roadhouse steak sauces, in addition to higher sales for Olive Garden dressings and Chick-fil-A refrigerated dressings. Our New York Bakery frozen garlic bread products also performed well in the quarter. led by the growth of our own Texas toast and supported by the growth of our garlic breadsticks. These items continue to offer families a great tasting way to stretch their food budget. CERCONA scanner data for the 13-week period ending June 30th shows sales for our licensed items grew 8%, with the newly introduced Subway and Texas Roadhouse sauces leading the way. while Chick-fil-A refrigerated dressings and Buffalo Wild Wing sauces also contributed to sales growth. The combined sales of Chick-fil-A refrigerated dressings and our Marsetti brand refrigerated dressings grew 11.3% to $39 million in the quarter, which increased our category leading share 330 basis points to 27.4%. I'm also pleased to share that during the quarter, Chick-fil-A avocado lime dressing became the second best-selling SKU in the entire category. Sales of our New York frozen bakery garlic bread product lines were up 2.8% to $94.7 million for a category-leading share of 40.6%. In the food service segment, strong volume growth of 4.2% driven by national chain restaurants was offset by the unfavorable impact of deflationary pricing. During Q4, we delivered strong gross profit growth of $4.4 million, or 4.8%, and a gross margin increase of 110 basis points versus last year. This increase was driven by the beneficial impacts of a range of cost savings initiatives. Our focus on supply chain productivity, value engineering, and revenue management all remain core elements to further improve our financial performance. I'll now turn the call over to Tom Piggott, our CFO, for his commentary on our fourth quarter results. Tom?