BellRing Brands, Inc.

Good day, and thank you for standing by. Welcome to Bellring Brands' third quarter 2023 earnings conference call. At this time, all participants are on a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. Please be advised that today's conference is being recorded. It is now my pleasure to introduce Jennifer Meyer of Investor Relations Bellring.

Good morning, and thank you for joining us today for Bellring Brand's third quarter fiscal 2023 earnings call. With me today are Darcy Davenport, our president and CEO, and Paul Rhode, our CFO. Darcy and Paul will begin with paired remarks, and afterwards we'll have a brief question and answer session. The press release and supplemental slide presentation 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. Last evening, we reported our third quarter results and posted a supplemental presentation to our website. I'm pleased to share our Q3 results were above our expectations. Net sales grew 20% over prior year and adjusted EBITDA was up 8%. The momentum in the business is palpable as we restart demand drivers on shakes. This quarter we brought new capacity online which allowed us to relaunch our temporarily discontinued shake flavors and expand our successful limited time offer program. Consumer and retailer excitement around these new flavors is incredible. Both Premier Protein and Dymatize powder businesses are also proving to be strong growth engines with both brands expanding distribution and responding well to media. You saw last night we raised our outlook for the year. We now expect net sales to grow between 19% and 22% over fiscal 22, with adjusted EBITDA to grow between 22% and 25%. Our better than expected Q3 performance drove our decision to raise our full year guide. We are proud of the progress that we made this year. While certainly not finished with our planning process, our initial expectations for next year are to deliver at the high side of our long-term algorithm in both net sales growth and adjusted EBITDA margin. As a reminder, our algorithm and net sales growth is net sales growth of between 10% and 12%, with EBITDA margins of between 18% to 20%. We will provide more details on our Fiscal 24 outlook in November. Turning to Q3, let's start with Shake production. Our production growth over Fiscal 22 continues to track in line with our expectations, with year-to-date production at below double digits. I'm happy to share that we brought a new command, Senocta, online during Q3, They represent one of our two greenfield facilities in our shake capacity expansion plan, and they have a smooth startup. They continue to scale up and will be a small contributor to our Q4, but a much larger contributor to fiscal 24 and beyond. Our second greenfield facility, Michael Foods, is expected to start up in Q1. While a slight delay, we remain on track to add north of 20% incremental capacity next year. This allows us to rebuild our internal safety stock and deliver robust growth in 24 and beyond. Now to the category and brand updates. The convenient nutrition category grew 14% in Q3 as tailwinds around health and wellness and fitness continued to drive growth. Consumer interest in functional beverages and sports nutrition products continues to be high. Ready-to-drink growth led the category up 21%, and ready-to-mix grew 16%. Increased supply is lifting ready-to-drink growth, while increased promotion, marketing, and distribution are boosting both segments. Moving forward, we expect to see continued strong volume growth, but pricing to be a smaller contributor. Premier protein shake consumption accelerated this quarter, up 27%. Growth was terrific across all channels, driven by improved supply and flavor expansion. The highest growth was in mass and e-commerce, as both benefited from our full range of flavors and higher in-stock levels. Our summer limited-time offering, Root Beer Float, was available outside of e-commerce for the first time and demonstrated an impressive 90% incrementality to the brand. In July, shake consumption continued to grow, up 21%, demonstrating continued strength. Our brand metrics this quarter reflect our building momentum. Premier Protein RTD market share reached 20%, our highest ever quarterly share. I'm also happy to report that Shake TDPs have returned to growth, surpassing our previous high in late fiscal 2021. Recall last quarter, Premier Protein became the number one brand in the RTD segment and the number one brand in the broader convenient nutrition category. The brand stayed in the top spot throughout the quarter. All of this is especially encouraging because we still haven't restarted meaningful marketing and promotion. Premier Protein made great progress in household penetration this quarter with the brand adding nearly one percentage point versus Q2 reaching 15% of households. Our household penetration continues to be the highest in the category, and we expect our Q4 marketing and promotional activities to further grow household penetration. Our repeat and buy rates are holding steady, demonstrating our consumer loyalty. The Premier Protein brand is proving it can travel to other forms and categories. Premier Powder's consumption was up 85% behind new distribution and strong velocities. In the same way that Premier mainstreamed the RTV category, we believe the brand can do the same within the powder category. In addition, we are seeing early success with our licensing strategy in both cereal and frozen pancakes. Although not a significant revenue driver, we are encouraged that the brand can be successful in other high-traffic aisles. Turning to Diamantize, the brand had another strong quarter with consumption dollars up 39%. We saw double-digit growth in nearly all channels driven by distribution gains, promotion, and marketing. The brand's strength continued into July. Dymatize's success with mainstream consumers continues. This fiscal year marks the first time the brand has meaningfully invested in broader media and the strategy is working. Base velocities on our flagship line, ISO 100, are up 30% versus the pre-media period. Market share, TDPs, and household penetration reached new highs this quarter with a ton of upside still in our future. Encouragingly, as Dimetize adds new households and distribution points, repeat and buy rates are holding steady. In closing, I'm delighted with our year-to-day progress. We are on track to deliver results ahead of our guide last November. We are accelerating and gaining momentum in almost every part of our business. Our first shake greenfield facility is now up and running, bringing us closer to realizing a step change in our shake production run rate. Premier Protein maintains the number one share position in our growing on-trend convenient nutrition category. We have begun to drive demand by relaunching our full assortment of flavors. Both Premier Protein and Dymatize are delighting mainstream consumers and reaching all-time highs in market share. Much of this momentum has come without major marketing and promotion. Looking forward, we can't wait to bring the premier protein and diametized brands to more consumers and help grow the category with our retail partners. We look forward to providing more specifics around fiscal 24 next quarter. Thank you for your continued support, and I'll now turn the call over to Paul.