WK Kellogg Co

Thanks, John. And good morning, everyone, and thank you for being here. Hopefully you had a chance to enjoy our cereal at breakfast this morning. It is our intention to start a great day for everybody here this morning, okay? That's our goal, and I'm pretty sure we'll be able to accomplish that. I'm joined on stage by Doug Vandevelde, our Chief Growth Officer, Sherry Bryce, our Chief Supply Chain Officer, and Dave McKinstry, our CFO. Before we get started, I'll remind you that our remarks today include forward-looking statements that reflect our current views and our assumptions. The slide lists factors that could cause our future results to be different than our current estimates. So today, we're going to unpack for you our unique value-creating strategy. You will hear about how we are delivering today during our first Strategic Horizon while also building for tomorrow to achieve our aspirations for our second horizon. Now let's start with a recap of who we are because we are a relatively new company. We are a scale North American cereal business with a number of the most iconic brands in the consumer products arena like Frosted Flakes, Special K, and Kashi, just to name a few. Our brands are instantly recognizable, and it's not an exaggeration to say everyone knows our chief mascot, Tony the Tiger, and we saw a lot of you taking pictures with Tony this morning. Through these iconic brands and characters, we generated adjusted net sales of $2.7 billion in 2024, and we hold leading market positions in the US, Canada, and the Caribbean in this durable, large, and important category. And as important, this is the category our founder created. In fact, today is our birthday as Kellogg Company was founded on this day 119 years ago. Thank you for that, and I think that is worth celebrating. We showed this slide last year, and it's as relevant today as it was then. As a reminder, three years ago, Kellogg's started exploring the idea of creating a standalone North American cereal company. The spin logic to us was very clear. North American cereal would be a stronger company if it were independent. It would have a dedicated team focused only on serial that would be integrated in a way that allowed for better visibility, decision making, and agility. The team would develop a fit for purpose strategy to drive outsized margin growth while maintaining a stable top line, the result of which would be a unique value proposition. And it would have the balance sheet flexibility needed to invest in that strategy, including investing our supply chain to make the business more reliable, agile and profitable. Today, we're executing on our strategy, delivering results, and we are firmly on our path. You're also going to see a new mile marker on our path. we're making significant progress separating from Calenova, a major undertaking that requires investment and focus from the entire organization. We expect to have that in our rearview mirror by mid-year. Now, a lot of you know we have been laser focused on three key priorities across our organization. First, we developed an integrated commercial plan to win. Second, we're modernizing our supply chain and third, we are unleashing an energized and winning culture. In 2024, we made significant progress executing against each of these priorities. Doug and Sherry, in a moment, we'll take you through our integrated commercial plan and our supply chain modernization. Let me unpack for you our third strategic priority, unleashing an energized and winning culture. It's safe to say it underpins everything we do. And we were very intentional about making this a strategic priority. We did this because our beliefs and behaviors shape how we operate. We affectionately call our culture the WK way. It's a culture that starts with being more personal and building trust. As you see on the slide, it frees everyone up to create and act boldly. In other words, our people are expected to speak their minds, think differently, and move faster. And it expands everyone's impact as our make it better mindset pushes each and every one of us to act beyond individual job descriptions. And finally, we win with purpose. Every day, we are focused on driving the right outcomes for our business. Our culture is as special and unique as our brands and characters. And best of all, it's only the beginning. I hope you could see that our culture is profoundly important to us. We can already see how it's driving better results. And indeed, culture does eat strategy for breakfast. And consequently, we believe we're the ones to serve it up. As we discuss our progress and aspirations, the theme you will hear is how we're delivering today while we're also building for tomorrow. Let's first review how we're delivering today. We call it Investor Day. We talked about our strategy in two distinct horizons. The strategy in our first horizon is about optimizing our scaled serial business, where we drive outsized improvements to our margins while maintaining a stable top line. Delivering today is about how we're executing on that very first horizon. Now, let me explain what we're doing. The slide tells you in a very simplified way what we're doing and what we knew we needed to do to optimize Serial. It starts with maintaining a stable top line and improving our profitability. Notably, we did this while transforming marketing, supply chain, and sales. Speaking of transforming sales, we successfully stood up a new, direct, dedicated sales force focused only on Serial. We're also transforming and modernizing our supply chain, which is the centerpiece of our margin improvement plan. And we're investing to separate Kalanova, becoming a fully independent organization. You'll hear more about that in a moment. Now let's walk through each one of these areas. Our near-term financial model is to maintain a stable top line and drive margin growth. We delivered that in 2024. Dave will take you through the details, but overall, we're very pleased with our financial delivery in 2024, particularly our adjusted EBITDA growth of 6.6%, which is above the top end of the guidance range we raised earlier in the year. The second key element of how we're delivering today is through our direct dedicated Salesforce. We expect even better execution going forward as our Salesforce continues to mature. Relationships with store managers are growing and we're becoming a more reliable partner through our improved customer service. In 2025, we're just beginning to fully leverage our Salesforce. The third element of delivering today is modernizing our supply chain. Earlier this year or last year in Q2, we announced the details of our modernization plan, which includes investing in our more efficient plants and consolidating our manufacturing network. Importantly, at that time, we confirmed all of the economics that we provided at Investor Day in 2023, investing up to $500 million, expanding adjusted EBITDA margin by approximately 500 basis points as we exit 2026. Sherry will talk about this more in a moment. The fourth and final element of how we're delivering today is separating from Calanova and importantly, investing in our operating structure as we do so. We expect to complete the separation and exit our transition services by the middle of this year. Importantly, as we have been separating, we are creating scalable infrastructure along the way. In other words, we are exiting a different and stronger company once we complete this complex transition. First, we will have our own IT platform, including a dedicated ERP system. We also took the opportunity to transform our IT capabilities and select business driving areas, such as marketing and sales. And we established our own dedicated independent warehouse network. Again, the network has been designed to best fit the needs of our business, including changing the location of some of our sites to enhance product flow across the organization. That's a summary of how we're delivering today. We're delivering our financial goals, standing up our direct sales force, modernizing our supply chain, and separating from Kelanova to emerge a stronger company once we are fully independent. Now that we've talked about delivering today, let's talk a little bit more about building for tomorrow. While Horizon 1 focuses on optimizing serial, we said that in Horizon 2, our strategy would be to accelerate our top line while continuing to expand margins. You're hearing that today, we are focused on delivering Horizon 1. We know there is so much to play for, so much value to create as we do so. That said, as we do that, we're also laying the groundwork and preparing for Horizon 2, which is our tomorrow. Our today is about cereal and our tomorrow is about cereal and beyond cereal. Now let's start with the left-hand side of the slide. Cereal will always be foundational for WK. We are competitively advantaged in this scaled category that is so important to our consumers and to our retailers. We're positioned to win in cereal through our iconic brands and capabilities. We know we can't and we will not stand still. Consequently, our team has identified specific areas to accelerate top line through what we call our serial growth framework. And now on the right side of the slide, as you look at Horizon 2, we believe we're building today what we would call a platform for growth, which we can use to grow in both serial and beyond serial. Our platform for growth includes the following. First, we can leverage our iconic brands in categories beyond serial. Second, we have what we call scalable infrastructure. The IT systems and the independent warehouse system I talked about a moment ago, just to name a few. And third, we have expandable capabilities, which can translate to unlock new growth opportunities outside of serial. Let me explain just a bit more. Like I said, it starts with serial. So let's review our serial growth framework. Doug and his team developed this framework and are beginning to execute this new framework focuses on effectively driving our core business and delivering exciting innovation. Both of which are part of today's playbook, but it includes new and different ways to drive growth. What's even newer would be capitalizing on green shoots and expanding into under penetrated white spaces in the category. such as certain channels and formats. We're clear on what we need to do, we have the assets to do it, and we also have the team to execute. Doug will expand on this framework right after my remarks. Now let's look about how we can expand beyond serial. We believe what we're building today is unique for a company our size and creates a platform for which WK could grow. Three key things I want you to listen for. Iconic brands, Scalable infrastructure and expandable capabilities. First, we're starting with a strong foundation of our iconic brands and characters, which we know can travel. As many of you know, we have the rights to use these brands in numerous categories. Second, we're building scalable infrastructure, including the Salesforce and IT network we talked about and the distribution system. Add to that what we call expandable capabilities. WK's commercial skills, in fact, all of our skills, largely come from a global multi-category company. These large cap capabilities, if you will, are translatable and expandable outside of serial. We have invested in all three of these areas to enable growth into the future. And while today we're focused on delivering our first horizon with outsized near-term commitments during that horizon, We're also preparing for the future and ensuring we have a foundation that enables growth. And so that brings us back to our strategic horizons. Dave is going to talk more about this, but you can see that our value creation path evolves over time. We have discussed the significant investments we're making in 25 and 26 to modernize our supply chain. As we realize the returns from those investments, it fuels investments to drive accelerated top-line growth with Serial and beyond Serial, all of which makes us even more cash generative, creating financial flexibility. Our platform for growth will be largely complete in 2025, and we can see Horizon 2 getting closer to begin exploring potential inorganic opportunities. We do believe inorganic growth can play an important role in our future. This slide gives you a high level understanding of the criteria we might use to evaluate potential opportunities. It starts with ensuring we are leveraging our infrastructure and capabilities. We're a branded center of store, dry food company, and we would stay close to our core. That would allow us to leverage our scalable infrastructure and utilize those large cap capabilities to drive synergy and value. And we would focus on exploring brands or businesses that compliment our portfolio and accelerates our top line and profit growth. And importantly, we would maintain our balance sheet strength, being a good steward of cash. For us, inorganic growth could come in various forms. Lower investment alternatives, such as distribution, as we use our distribution network and Salesforce. Alternatively, we could license our brands into other categories. Perhaps our inorganic growth could come in the form of tuck-in M&A or joint ventures. I led corporate development for the Kellogg Company and saw the power of reshaping our portfolio through both of these frameworks. We share this with you today to give you a sense of where and how we can expand in the future. That said, rest assured, our focus right now is optimizing our serial business. As we have said, we have much to play for. Our first horizon drives so much value for us, and we remain focused to ensure we do exactly that. Now let me bring it all together to express why WK is a compelling investment opportunity. We're building on a strong foundation starting with a now 119 year history and a portfolio of iconic brands. And as a standalone company with a focused strategy, we're positioned to deliver. Our dedicated sales force, integrated commercial plan, and serial growth framework will help to deliver a stable top line. Our actions to modernize our supply chain will allow us to capture the margin opportunity that's in front of us, as well as drive reliable service for our retail partners. And we expect to be well positioned to generate significant cash flow, leading to attractive returns for our shareholders. Through our platform for growth, we can win in serial and prepare beyond serial. So with that, I'm going to turn it over to Doug Vandevelde, who will share more about our integrated commercial plan to win, Doug is our chief growth officer. No one knows the cereal category. No one knows our brands better than Doug, and I'm excited to introduce you to him. Doug?

Thanks, Gary, and good morning, everyone. What you're going to hear today is that we've made a lot of progress in our first year, and we're just getting started. So let's jump in and review our category and our brands. Let's start with the fact that so many people love the cereal category. Cereal is a top choice for kids and adults for breakfast and one of the largest center store food categories for retailers, with total category sales north of $10 billion. In the U.S. alone, there are 50 million purchases of cereal every week. While the category has been largely stable over the past years, we see some tailwinds and some potential for future growth. To start, there are many benefits within cereal that go largely unrecognized. It all starts with the letter S. Cereals are more simple than you think. Most of our cereals start with a grain that we simply puff, toast, flake, or shred. to unlock the benefits. And many of our cereals start with only four ingredients. And then we add vitamins and minerals. Our biggest brand, Frosted Flakes, is one of these. More on that in a minute. P is for protein. Not many people think of protein when it comes to cereal. But in fact, a bowl of cereal with milk contains as much protein as an egg. And When you take our high-protein cereals like Special K with 10 grams of protein and you add a high-protein milk, you get over 20 grams of protein in one delicious bowl of cereal. Next, studies show that cereal is the number one source of fiber for kids. Awareness of fiber is growing due to its benefits to overall gut health. And the fact is, it's a key nutrient that most people don't get enough of. and that's where cereal comes in. Last year, our portfolio provided over 7 billion servings of fiber in the diet. Cereal also helps bring other healthy foods along. It's a top food eaten with fruit, and 90% of all cereal is consumed with milk, bringing along added nutrition. We know that consumers add nuts, seeds, or even protein powder, offering the ability to make cereal exactly what you want. N is for nutrients. Cereal eaters get more nutrients than non-cereal eaters, including important nutrients such as vitamin D, calcium, fiber, iron, and folate. Cereal eaters also get less sodium and less saturated fat. The last S, sugar, is often associated with cereals. But the facts are that cereal eaters get no more added sugar than people who don't eat cereal. And cereal contributes less than 5% of the added sugar in the diet. Less than 5%. And what could be more fitting than the acronym spoons? The way all of that nutrition and great taste gets from the bowl to your mouth to enjoy. This year, we intend to invest behind communicating these credentials to consumers to highlight the benefits of cereal. So as we think about how all of that can come to life, we have a strong portfolio of iconic brands that families have had in their homes and on their tables for decades. This portfolio delivers on the positive spoons attributes we just discussed, which we can leverage to drive our top line. For example, our biggest brand, Frosted Flakes, starts with a simple grit of corn that is toasted and frosted to deliver an unmistakable taste that consumers love. And Frosted Flakes are simple, with only four ingredients, plus the nourishing vitamins and minerals. No wonder there are 3.5 million units of Frosted Flakes purchased every week and growing. Frosted mini-wheats and raisin bran bring whole grains and fiber. Kashi delivers offerings that are natural and organic, as well as high in protein and fiber. We offer a portfolio of choice. And as we like to say, no matter who you are or what you do, there's a Kellogg's cereal that's right for you. So there's a lot to like about our category and our brands. Now, Taking a step back, as Gary mentioned, over the past year, we've been delivering today and building for tomorrow. We've made significant progress. We've completely transformed how we operate and manage the business. We integrated across functions and business units, creating a cohesive strategy to deliver on our number one priority of winning in serial. We launched a new marketing model, and stood up a dedicated sales force. And the team is executing better and better every day. We're continuing to invest in our capabilities and assets to position ourselves for future top line acceleration. And we're wasting no time. We are immediately leveraging our integrated commercial plan and capabilities in the near term. I'll first unpack how we've transformed the way we operate, and how we've enabled capabilities. And then I'll go through our framework to drive the top line growth today and over the long term. So at the core of our strategy is an integrated commercial capability which brings together sales, marketing, and supply chain, a key component of the SPIN rationale. Today, our team is entirely focused on serial. With a unified strategy and shared priorities, This cross-functional collaboration enables cohesive end-to-end planning, greater agility and speed, and resulting in improved execution. One of our key competitive advantages is our direct and dedicated sales force. As part of the SPIN, we designed the organization to maintain the same level of store coverage as pre-SPIN. Now we dedicate 100% of our focus to cereal, unlike before when our efforts were divided across six different categories. We have equipped our in-store teams with the data and insights to highlight the benefits of cereal to our retailers, whether it's demonstrating how cereal drives in-store traffic or optimizing merchandising to achieve improved sales lifts. And we are seeing the results. During the critical weeks of back to school, our Salesforce delivered display growth at key retailers, resulting in increased dollar and unit share. This will be year two for our Salesforce. Capabilities are maturing and relationships are strengthening. The execution of our Salesforce is a key enabler of our top line. Next, we created our new marketing model to improve our capability to deliver bold, big ideas and media that elevate the impact of our iconic brands. We've already seen promising results from this revamped approach with Frosted Flakes and Raisin Bran being the primary beneficiaries, both of which were among the fastest growing top 10 category brands in 2024. We know this model can be utilized across the portfolio, so let's take a moment to unpack how we are leveraging these new capabilities. First, we are scaling the use of multi-brand campaigns. Multi-brand has a strong impact, helping to boost visibility across the portfolio. As a result, the returns are stronger. In fact, multi-brand campaigns have nearly 2x the return of a single brand. Second, we're improving our brand relevance with bold, culture-first ideas. For example, we partnered with Minecraft and mega influencer MrBeast to drive our brands in an activation that delivered strong consumer engagement. Third, we have brought our social media team in-house, which has allowed us to be more agile and has expanded our customer reach with greater precision. And last, we are continuing to lean into Omni. We've integrated the Omni team, so items like optimizing search, click and collect, and improving alignment with our brick and mortar strategy are now getting more focus than ever before. And on top of that, we're continuing to build capabilities in data and leveraging AI to deliver targeted consumer experiences. Next, we are building our R&D capability. Within the cereal category, it all starts with the food. Our R&D team was well established coming out of the spin. Originating from the resource and expertise of a large cap multinational organization, they are equipped with a breadth of knowledge and capabilities, a key differentiator for a company our size. We know this category thrives on exciting innovation, and that's why we're continuing to invest in our people, capabilities, and infrastructure. In fact, most recently, we built a new state-of-the-art food development lab to strengthen our ability to innovate, ensuring we stay ahead of consumer trends, and continue to bring exciting innovation to the market with speed. Sherry will talk next about what we're doing to build and integrate our supply chain capability. But before that, let's transition to our serial growth framework that Gary touched on earlier. You can see on this slide, this framework encompasses effectively driving our core business, delivering exciting innovation, capitalizing on category green shoots, and expanding into new channels and formats. As Gary mentioned, there are new elements across all of these areas. We are beginning to execute this new framework in 2025 and will continue to leverage it over the medium term. I will take you through each of these now. First, one part of driving the core We conducted new research to deepen our understanding of what consumers love about cereal and to identify barriers around the category for lapsed users, benefits and barriers. It's been a insightful analysis which we like to refer to as cereal reappraisal. Cereal is convenient, it tastes great, it's satiating and nutritious, but most of all, it elicits feelings of joy. I saw a lot of joy on the faces in that breakfast room this morning. Let's take a look at how we leverage those insights by harnessing the power of joy through nostalgia with our latest ad campaign, Tastes Like Saturday Morning, and Frosted Flakes, They're Still Great. Please roll the video. Frosted Flakes, good. They're great. Great. Great.

You're still great, Grandpa.

See? Told ya.

There goes... Okay.

Morning, beautiful.

Good morning.

Hey, buddy.

Ah! Look, look, look, look!

I found it! Kellogg's tastes like Saturday morning.

The next element of our framework is innovation, which is key to driving excitement and top-line growth in the category. Last week, Gary spoke during our earnings call about the impact of platforms, a strategic component of how we leverage our portfolio to drive future innovation. As you can see, we've created and extended platforms across food forms, brands, formats, segments, and nutrition. Our new Glaze platform takes some of our core brands and brings them to life in a new and delicious way. And it's off to a good start. I hope you had the opportunity to try this fantastic food during breakfast this morning. My personal favorite is the Apple Jacks. Frosted Mini Wheats Cocoa and Blueberry Brand Crunch are a great example of relevant extensions to already strong brands. We're continuing to build momentum in expanding our formats, We've introduced various go packs to capture the growing out of breakfast occasion. 2025 platform innovation is a key element of how we will deliver our top line. We've also expanded our offerings in the growing health and wellness segments of the category, which is the next element of our growth framework. Over the past few years, we've seen cereal consumers shift towards more health-forward trends, resulting in the granola and natural and organic segments growing faster than the category, at around 10%. Importantly, we have the right brands to compete here. Both Kashi and Bare Naked are among the leading brands in these segments. These brands were managed separately under the broader Kellogg's organization, and now, They have been folded into our integrated commercial plan, and we're very excited about their potential. More broadly speaking, we believe our brands can better capitalize on the health trends that are in demand, and we are going to invest here to drive growth. Brands like Special K, Mini Wheats, and Raisin Bran offer essential nutrients consumers are looking for, like protein and fiber and folic acids. a key element of spoons, as we discussed. We've reignited our focus on highlighting the health benefits of these products to better connect with health-conscious consumers. And as I mentioned earlier, many of the benefits of cereal today are underappreciated, which we plan to address through targeted investment. Now, the last area revolves around opportunities to scale our brands through new channels and new formats. These are areas where we believe we have a strong right to win. You can see how we're leaning in with our 2025 innovation plan, offering more GoPacks, which build on our success in cereal in a cup. Let me unpack that a bit. When we look across other categories, single-serve offerings represent a greater portion of the total pack size. No surprise that our cups business has grown 19% in the past year. Interestingly, the data suggests that cups are driving lapsed users back to the category. And when they come back, they're reminded how much they love cereal. So more to come in this space as we execute our supply chain modernization plan, we will have increased packaging flexibility to further enable growth. So in summary... We have a robust plan in place to drive the business forward in 2025 and beyond. Our serial growth framework is grounded in consumer-led insights and attractive white space opportunities. We are reigniting joy, launching exciting innovation across the portfolio, leaning in to on-trend health platforms and expanding formats and channels. all of which is supported by our integrated commercial capabilities, continued discipline, and focus on ROI. Our full focus and intent is to grow cereal one spoonful at a time. So now I'll turn it over to my friend Sherry to discuss our plan to modernize our supply chain.

Thank you, Doug. I'm excited to be here today to share the progress we've made on our supply chain modernization journey. I will take you through what we have achieved in 2024, how we have modernized our supply chain, and the expected outcomes of this strategic priority. Our modernization plan is focused on investing capital, building capabilities, and consolidating the network to drive better margins and reliability. while also improving engagement. Engagement is a key element on how we will win in manufacturing. First, we're making capital and investments to modernize our supply chain. We're moving from maintaining our facilities to modernizing our facilities. Second, we've already changed our ways of working to drive efficiency by implementing more digital tools and capabilities to drive high performing teams. I know the impact of high performing organizations, and I know that it's better execution. And last, we're consolidating our manufacturing network, moving production from our lowest cost, more efficient facilities. When we modernize, we will become more reliable and agile, driving top and bottom line results. Last year, we announced the details of our consolidation plan, and we're pleased that that execution is on schedule and on budget. Supply chain modernization is a centerpiece of our 500 basis points margin improvement plan. And we're confident we'll capture every opportunity. What I'm most proud of in 2024 is what you see here. We have been laser focused on driving operating improvements across supply chain, and we're already delivering improved execution, better customer service, and enhanced margins. We didn't wait for capital to be spent on new equipment. We got to work right away and improve everyday execution. We did it through integrating our teams, breaking down silos, and driving engagement to ensure our supply chain was better connected end-to-end. The will reflects how we're connecting demand planning, commercial, procurement, and the plants to ensure we were planning effectively and we solved problems together. Within our plants, we built capabilities, identify root causes to losses, and put tools and processes in place to empower our teams. Within logistics, we have enabled our TSA exit by completing the transition to five independent third-party warehouses. Execution to date has been flawless, and only one warehouse transition remains. Let's take a closer look at the results we have delivered. Overall equipment effectiveness in our plants have already improved 130 basis points in 2024, driven by our capability improvements, better integration across supply chain, and our increased engagement. With the OEE improvement and as a result of running more efficiently, we're becoming a more reliable partner to our customers and it's reflected in the improved case fill rate you see here. The outcome. a stable top line, and improved adjusted gross margin of 90 basis points. This doesn't happen by accident. It happens when teams come together with a common goal, can see how they contribute to the overall objectives of the business, and have the right tools and processes that enable consistent delivery. That's how a high-performing organization operates. That's how we operate. So, what's next? We still have work to do to shape our future. Our investment to modernize our supply chain and consolidate our manufacturing network continues. We expect to complete our final warehouse transition by the middle of this year. We will continue to enable high-performing organizations through our WK Academy, which is our capability-building program for our people. And through enhanced data and predictive analytics, our strategy is already in place and we have already begun execution. Through our investments, engaged culture, and enhanced capabilities, our supply chain should become even more efficient, reliable, and agile. And our improved execution in 2024 gives us confidence of our ability to deliver. Let's review our investment and what that investment achieves. As I mentioned in August of last year, we announced the details of our plan to invest up to $500 million to modernize and consolidate our manufacturing network and deliver approximately 14% adjusted EBITDA margin as we exit 2026. Execution of this important initiative is currently on schedule and on budget. I will now take you through how we are modernizing and what we expect those efforts to achieve. Let's unpack how we're modernizing our supply chain. First, we're investing in infrastructure at our lowest cost plants. Those investments include building expansion, more modern and standardized processing and packing equipment, upgrades to existing lines to make them more efficient, and adding capabilities so they can produce a wider variety of products. Second, we're becoming more efficient through improving our digital capabilities and our operations to get the most out of both our new and existing infrastructure. For example, we're implementing Digital Twins, a digital replica of our production lines which will allow us to improve the predictability of our performance. We have already started implementing Smart Factory, which is a suite of applications to help us enable plant teams to utilize data analytics to make informed and accurate decisions about operational performance. Digital capabilities combined with the standard ways of working are implemented through our Kellogg integrated work systems, which provides our teams with the tools needed to drive more efficient operations. But infrastructure and capabilities are only part of the plan. The last and most important piece is all about our people. They are the secret sauce to maintaining our improvements. We are engaging differently, empowering our teams to take ownership by creating a culture where everyone has a seat at the table, where we're sharing best practices and learning from one another while leveraging tools and capability that enable us to win. We just looked at how we are modernizing our supply chain. Now let's look at what we will achieve when we complete the supply chain modernization. First, our network will be more reliable and agile. We will have a simpler network with five manufacturing locations. Second, we will reduce and standardize the technology used in manufacturing. By using more modern and standardized equipment, our maintenance program will be more efficient, leading to less downtime. Additionally, our new equipment will be more energy efficient. All of these factors should work together to improve our margins and enhance the efficiency of our network. The last piece may not be as obvious as how our supply chain modernization enables top line growth. Earlier, I showed you our improvement in customer service. We're happy with our progress, but we can further improve our customer relationships by ensuring consistent reliable supply. For example, with investment comes new packaging capabilities to make sure we can deliver the right pack in the right channel. And when we have a more reliable network with enhanced capabilities, this will enable and support our growth framework that Doug mentioned. It helps us to be more innovative and improve speed to market. This initiative is currently on schedule and on budget, in large part due to the rigor in which we are managing the program. A committed team is running this initiative, solely focusing on executing the program every day. They keep our execution on track, foresee potential problems, address them, and monitor our progress closely. To manage the program effectively, we have divided it into eight work streams, each with its own dedicated team. And to ensure a smooth transition, we have begun outlining a startup plan through what we call Kellogg Startup Management. This includes planning for necessary resources, ramp up time, and related costs. As you've seen, we're taking a holistic approach to improving the performance in our supply chain. This work will be done so far has already improved the results that you're seeing today, and we're confident in our ability to execute our margin improvement plan. I will now turn it over to Dave to take us through our financial model.

Thank you, Sherry. Good morning, everyone. It's great to be back here today. During today's presentation, I will cover how we're delivering our financial model today, how we're positioning the company for the future, and how that impacts our financial model over time. We unveiled this model at our investor day in 2023, and we're delivering against these key components today. First, our model is predicated on having a stable top line. This is enabled by a durable category backdrop, our portfolio of iconic brands, and our integrated commercial plan. Second, we're improving the efficiency and reliability of our supply chain operations. This is designed to drive significant margin expansion and enable the top line. Third, when we maintain a stable top line and expand our margins, our cash flows will improve. This will provide increased financial flexibility and greater shareholder returns. Already today, you've heard from the team about how we're committed to executing our strategic plan while at the same time positioning the company for the future. By intentionally designing a scalable asset base and investing in expandable capabilities, we're creating a robust platform to accelerate growth. As we continue to advance our strategic priorities and expand our growth potential, we expect that our financial model will adapt to reflect this evolution. We would move from targeting a stable top line to an accelerating top line. We intend to continue to expand our margins as we drive efficiency across our modernized supply chain network and the organization. And lastly, as we complete our capital program to modernize our supply chain, we expect to see increased cash flow providing more capital allocation flexibility. Let's take a look at how we're delivering our strategic priorities today. We're maintaining a stable top line, improving our return on investment, delivering enhanced margins, and growing adjusted EBITDA dollars. In 2024, we delivered adjusted net sales broadly consistent with our guidance for the year, which helped enable our profit delivery. We remain focused on maximizing ROI, taking a balanced approach to driving the top line and growing profits. During 2024, we improved the earning power of our investment dollars, which I'll illustrate in just a moment. Our focus and discipline have yielded significant margin expansion. In our first year, we operated more efficiently by reducing waste, focusing on costs, and limiting equipment downtime. All this yield results in 2024 as we delivered that 6.6% adjusted EBITDA dollar growth, which exceeded our guidance. It starts with maintaining a stable top line. Importantly, the category is providing the backdrop we need to execute our plan. In 2024, the category was down 1.3% in the US in line with our planning assumption. We were able to deliver adjusted net sales of down 1.1% or down 0.9% when excluding the impact of currency. We're taking a disciplined and balanced approach to our investment dollars with the goal of driving the top line while maximizing return on investment. And we're seeing those results. We've improved our return on promotional investment mid single digits. And as Sherry mentioned, our overall equipment effectiveness improved 130 basis points. These improvements reflect an organization that views each and every P&L light item as an investment. to ensure we're calibrating our returns properly and allocating investments appropriately. As we've spoken about, our supply chain is operating more efficiently end-to-end, which has resulted in improved adjusted gross margin and delivered adjusted EBITDA dollar growth. For the year, we delivered 90 basis points of adjusted gross margin expansion, and adjusted EBITDA dollars grew 6.6% at the top end of our guidance range, which we increased during the year. Putting it all together, when we maintain a stable top line, combined with enhanced focus and discipline across our investments and operations, you can see the earning power of our business. As we look ahead to our outlook for 2025, we're building upon our focus and discipline that delivered those results in 2024. This is how our near-term model works, maintaining a stable top line and expanding margins. We detailed on our Q4 earnings call our 2025 guidance, which calls for net sales to be down approximately 1% and adjusted EBITDA dollars to grow 4% to 6%. Our 2025 plan is underpinned by improved supply, beginning to execute our serial growth framework Doug took you through, and continued focus on maximizing ROI. This is another step on our path as we march towards exiting 2026 with approximately 14% EBITDA margin. As we sit here today, we're delivering on our financial model, and we believe we are well positioned to drive long-term shareholder value. Our top-line delivery and improved operations are allowing us to increase margin and return capital to shareholders. As we recently announced, we increased our dividends, representing 66 cents per share on an annualized basis. This increase reflects our confidence in executing our strategy and delivers on our commitment to return capital to shareholders along the way. We remain committed to a growing and sustainable dividend with a long-term payout ratio target of approximately 45%. Let's look at how we're positioned to drive value over the long term. We're excited about the top line plan Doug has orchestrated, which takes a fresh perspective on new growth initiatives and ensures we're driving our core brands. And upon completion of our highly accretive supply chain modernization initiative, we expect to emerge with improved margin and increased financial flexibility. As we fully leverage the capabilities of our operating model, including that scalable infrastructure and expandable capabilities, we see greater potential to accelerate growth beyond serial. Improved cash flows should provide us greater flexibility to make the right investments to drive long-term, sustainable value. As you already heard from Doug on how we're providing the top line with our new serial growth framework, so let's turn to our margin expansion opportunity. We began our journey as an independent company with approximately 9% adjusted EBITDA margin and announced our plan to improve by approximately 500 basis points to 14% as we exit 2026. But we think there's opportunity beyond 14%. Once our supply chain modernization is complete, we believe there will be opportunity to drive further efficiencies. It will be our first time operating with an optimized network that Sherry just took you through. The tools, technology, capabilities we will have implemented should provide an opportunity to continue to improve how we operate end to end. Important to our strategy is having the right capital structure and balance sheet capacity to execute our investment plan. We ended 2024 with leverage of approximately 1.8 times and ample debt capacity to invest. We will step up investment dollars in 2025 before reaching peak leverage in early 2026 at approximately three times. We're continuously assessing opportunities to enhance cash flow. This creates additional balance sheet capacity to pursue further value accretive initiatives. The strength of our balance sheet is a top priority, and we remain committed to a long-term leverage target of approximately two and a half times. Post-modernization, leverage should reduce quickly as we realize the benefit of increased cash flows, which would then enable improved financial flexibility. So, we expect our capital allocation strategy will evolve over time and transition from a capital program that is heavily weighted towards infrastructure investment to a program with enhanced discretionary cash flow. I've already spoken about our commitment to the strength of our balance sheet and returning capital to shareholders through a sustainable dividend, both of which will remain key priorities. But we expect with that enhanced discretionary cash flow, we will be able to evaluate additional opportunities, such as organic growth and inorganic growth. These capital allocation options will be evaluated on a returns-based approach, ensuring we're maximizing value for our shareholders. In summary, We're pleased with where we're at in our journey, but we're just getting started. You can see WK offers a unique value proposition through margin enhancement and investing in the future, along with an organization that is focused on transforming to drive sustainable long-term value. Thank you. I'll now hand it back over to Gary to close us out.

Thanks, Dave. As we wrap up, you can hear the progress we're making. We're broadly delivered on our financial goals in our first year as an independent company. We're investing in our supply chain to create a more reliable and efficient manufacturing network. We're positioned to win in serial through our iconic brands and capabilities, and we're preparing for Horizon 2. building infrastructure and capabilities we can leverage in serial and beyond serial. When we bring all these elements together, it would lead to a top-line acceleration and improved value creation. Thank you for joining us this morning. I think we have a time. Actually, we probably don't have time for questions. I'll leave it over to you, John.

Yeah, we're going to take questions over in the breakout session. Please join me in thanking management of W.K. Kellogg Company for the breakfast, their longtime sponsorship, and questions in the breakout room.