BellRing Brands, Inc.

Welcome to the Bellring Brands fourth quarter and full year 2020 earnings conference call and webcast. Hosting the call today from Bellring Brands are Darcy Davenport, President and Chief Executive Officer, and Paul Rode, Chief Financial Officer. Today's call is being recorded and will be available for replay beginning at 1.30 p.m. Eastern Time. The dial-in number is 800-585-8367, and the passcode is 497-1167. At this time, all participants have been placed in a listen-only mode. It is now my pleasure to turn the floor over to Jennifer Meyer, Investor Relations of Bellring Brands, for introductions. You may begin.

Good morning, and thank you for joining us today for Bellring Brands' fourth quarter fiscal 2020 earnings call. With me today are Darcy Davenport, our President and CEO, and Paul Rhone, our CFO. Darcy and Paul will begin with prepared remarks, and afterwards we'll have a brief question and answer session. Press releases, supplemental slide presentations that support these remarks are posted on our website in both the investor relations and the SEC filing sections at bellring.com. In addition, the release and slides are available on the SEC's website. Before we continue, I would like to remind you that this call will contain forward-looking statements, which are subject to risks and uncertainties that should be carefully considered by investors as actual results could differ materially from these statements. These forward-looking statements are current as of the date of this call, and management undertakes no obligation to update these statements. As a reminder, this call is being recorded, and an audio replay will be available on our website. And finally, this call will discuss certain non-GAAP measures. For reconciliation of these non-GAAP measures to the nearest GAAP measure, see our press release issued yesterday and posted on our website. With that, I will turn the call over to Darcy.

Thanks, Jennifer, and thank you all for joining us this morning. Last evening, we reported our fourth quarter and fiscal 2020 results, as well as posted a supplemental presentation to our website. This presentation provides more insight into our business, consumption, and key metrics. We finished 2020 strong, with record net sales for the quarter of $283 million, up 32%, and adjusted EBITDA of $57 million. For the year, net sales grew to $988 million, slightly exceeding our revised sales guidance, with adjusted EBITDA of $197 million. Despite the challenges that COVID created, we exceeded our long-term algorithm and delivered net sales growth of 16%. Adjusted EBITDA came in at the midpoint of our original guidance, and we delivered strong cash flow generation, reducing our net leverage. I'm proud of our accomplishments in our first year as a public company and specifically for the resilience our employees demonstrated throughout a challenging year. This morning, I'll review the category, brand highlights, growth strategies, and end with our fiscal 21 outlook. The convenient nutrition category has been stable since mid-June, although below pre-COVID levels as a result of less on-the-go usage, mainly due to nutrition bars. Across the category, we're seeing fewer shopping trips, higher basket sizes, and the category continues to shift to e-commerce and food channels. Our main segments, liquids and powders, have rebounded to their pre-COVID growth rates. However, the virus has impacted the category segments differently. Adult and everyday nutrition brands continue to gain share, driven by higher in-home usage. Weight management has suffered as consumers move to comfort foods, while sports nutrition brands are primarily flat as consumers figure out new ways to exercise outside the gym. Premier protein shake consumption improved this quarter, up 20% across tracked and untracked channels. Growth was strong across all of our key channels, club, mass, food, and e-commerce. Effective promotional programs along with distribution gains and healthy velocities drove consumption growth. Untracked channels continued to outpace tracked at 38% while tracked returned to growth this quarter. This strong momentum has continued in Q1 with the first six weeks showing 21% growth across tracked and untracked channels with impressive gains in food, mass, and e-commerce. We made great progress against our growth strategies this year. Premier Protein's household penetration reached 6.8%, gaining one percentage point this year. Our distribution continues to increase with brand TDPs of 9% sequentially and 26% for the year. We now have an average of 6.7 items on shelf. We're pleased with the effectiveness of our sales and marketing activities and look forward to building on our success in 21. Our new products continue to excite both consumers and retailers. Our seasonal offering, Pumpkin Spice, drove strong velocities across both e-commerce and retail outlets. Our newest 30-gram flavor, Cinnamon Roll, shipped at the end of the fourth quarter and quickly sold out across e-commerce platforms. We also started to ship a new pack size, 12 count, to the mass channel at the end of the quarter. This is a major 21 initiative for us because larger pack sizes represent a quarter of the FDM category. We're excited to give consumers the option to buy larger packs anywhere they shop, and early results are promising. Diametize had a fantastic quarter of 57% domestically with growth across all channels. Our new products, ISO 100 Fruity and Cocoa Pebbles, have vastly exceeded our expectations, becoming the number three and number five flavors within the ISO 100 line. We are quickly gaining distribution across all channels on these exciting new products. Our international business was relatively flat due to COVID, but showed strong sequential improvement, up 50% versus last quarter. Premier shakes in Canada drove most of the gains, while Dymatize and Powerbar continue to be challenged within the global specialty channel. Our supply chain performed well all year, executing best-in-class service in the midst of unexpected volatility. Our frontline employees in our Germany plant and within our logistics and co-manufacturing network were invaluable to our success. Our fifth and newest co-manufacturer is performing well, and our Shake Network remains well-positioned to support our growth plans. Now to our outlook. As you saw in yesterday's press release, we expect fiscal 21 net sales to grow 8% to 13% and adjusted EBITDA to grow between 5% and 10%. This guidance is consistent with our long-term algorithm of 10% to 12% net sales growth at 18% to 20% EBITDA margins. EBITDA growth lags sales growth because we are choosing to invest in brand building and our commodity and logistics costs are running higher year over year. Despite the higher costs, we are prioritizing driving share in a growing market. We believe now is the time to bring new households into the category rather than maximizing immediate margin. We will do that through increased strategic media and promotional spending, stronger creative, execution of Premier Protein's upsize initiative, and continued flavor expansion. As a result of the increased investment, we expect the timing of EBITDA growth to be entirely in the back half. This is due to strong Q2 media spend, raw material and logistics headwinds in the front half, and lapping COVID demand shifts. Overall, I'm very confident in our expansion plans for 2021 as we increase investments, grow our brand awareness, and continue to generate strong cash flow. The RTB and powder categories have stabilized and are growing at pre-COVID levels. Our household penetration is increasing. We are gaining significant distribution on both existing and new products. Our marketing and promotional strategies are working, and our supply chain is is well positioned to support our growth. Although we continue to face challenges with COVID, I continue to be energized by our potential and our long runway for growth. I will now turn the call over to Paul.