Nomad Foods Limited

are in the listen-only mode. A question-and-answer session will follow the formal presentation. Please note that this conference has been recorded. I would now like to turn the conference over to Mr. Jason English, Head of Investor Relations. Please go ahead.

Hello, and welcome to Nomad Foods' first quarter 2025 earnings call. I am Jason English, Head of Investor Relations, and I'm joined on the call by Stephan Deschmaker, our CEO, and Ruben Baldu, our CFO. By now, everyone should have access to the earnings release for the period ended March 31st, 2025, that was published at approximately 645 a.m. Eastern Time. The press release and investor presentation are available on Nomad Foods' website at nomadfoods.com. This call is being webcast, and a replay will be available on the company's website. This conference call will include forward-looking statements that are based on our view of the company's prospects, expectations, and intentions at this time. Actual results may differ due to the risk and uncertainties which are discussed in our press release, our filings for the SEC, and our investor presentation, which includes cautionary language. We will discuss non-IFRS financial measures during the call today. These non-IFRS financial measures should not be considered a replacement for and should be read together with IFRS results. Users can find the IFRS to non-IFRS reconciliations within our earnings release and in the appendices at the end of the slide presentation available on our website. Please note that certain financial information within this presentation represents adjusted figures for the first quarter of 2024 and 2025. All adjusted figures have been adjusted primarily for, when applicable, share-based payment expenses and related employer payroll taxes, exceptional figures, and foreign currency translation charges or gains. Unless otherwise noted, comments from here on refer to those adjusted numbers. With that, I will hand it over to Stephan. Thank you, Jason.

Nomad Foods has now entered its 10th year as a public company, and the environment in which we celebrate our 10th anniversary is so far proving to be anything but boring. The good news is that we have built a resilient organization and portfolio that is willing to weather the current economic environment. Our leading brands remain healthy, and as I will illustrate in a few moments, our category in Europe is strong. Furthermore, I remain confident in our strategy. Our commercial flywheel is spinning at a good rate, producing attractive innovation, impactful merchandising, and compelling advertising. And while performance can be choppy month to month or even quarter to quarter, I think you will agree that the trend line of our underlying pre-improvement highlights the strength of our business model. And with that, let me turn my attention to result on slide three. Our retail sales through rose modestly in the quarter, which was in line with expectations. Recall last quarter that we guided through a slower start of the year, given the timing of our growth initiatives as well as the later Easter this year. This largely played out as expected. And I'm pleased that our organization was able to deliver another quarter of gross margin expansion. This, as well as overhead savings that we are just now beginning to realize, helped fund a double-digit increase in ANP this quarter. And our strong cash flow has allowed us to continue returning cash to shareholders and reinvest in our business. In fact, in the first quarter, we repurchased 49 million euros of shares and paid our 25 million euros of dividends. This collective 74 million euro in the first quarter marks a 152% increase versus what we returned to shareholders in the first quarter last year. We have a lot to celebrate. But at the same time, I recognize that our industry is facing headwinds to overcome. Our net sales, for example, lagged ourselves through by a larger than expected amount in the first quarter. as we see is greater than expected retail inventory stocking across Europe. Meanwhile, we are seeing some increased value seeking behavior by consumers, and our input cost outlook has modestly increased. We will offset this cost pressure with targeted pricing, as we have successfully done in the past, but these increases will take time to fully implement. And rather than curtail investment to mitigate some of these headwinds, we continue to invest behind our brands and products for the long-term health of our business. Based on these factors, we believe it is prudent to lower our full year organic revenue, adjusted EBITDA, and adjusted EPS growth ranges for the full year 2025. Ruben will share more details on the quarter and full year outlook in a few minutes. I do not want this native volatility and retailer inventory stocking to detract from the bigger picture. As you have heard us say before, we have a category and portfolio advantage that positions us for long-term success. As you can see on slide 4, the frozen category in Europe remains healthy. Growth of the category slowed in 2024, but it has recently accelerated driven by improved volume and value gains and is once again outpacing the overall food market. We expect the category growth in the near term to remain choppy, especially in markets like the UK, where industry-wide promotion activity is being reduced to offset inflation. But we do believe the category's outperformance versus the overall food industry is a long-term dynamic. The frozen category has outgrown the overall food industry by nearly one percentage point over the past decade, and we are happy to see it resuming its leadership position. The category continues to benefit from the secular trends of convenience, sustainability, value, and great tasting food. In fact, with the adoption of air fryers, We are increasingly able to deliver restaurant-quality food from the freezer with lower preparation times and higher consumer satisfaction than prior preparation methods, while saving consumers substantial money relative to the restaurant's alternatives. We are excited about the long-term growth opportunity in our category, and we especially appreciate how our portfolio is positioned within it. As a reminder, Two-thirds of our revenue is generated from lean proteins and green vegetables, and 94% of our UK and Western Europe revenue is generated from products deemed a healthy meal choice by the UK government. We believe we are well-positioned to meet consumers' evolving nutritional needs. We believe this powerful advantage, combined with our effective strategy and go-to-market playbook, was a key contributor to the improved market share performance we achieved over the last six months of 2024, as you can see on slide five. These share gains have stalled in the first quarter of 2025, but this was largely as expected. As I mentioned earlier, many of our key growth initiatives are scheduled to begin the second quarter. These initiatives are centered around our mushroom battles, especially fish. while our investment behind our growth platforms has continued at a steady pace. And that investment is paying off. Net sales for our growth platforms rose 36% year-over-year in the first quarter. Chicken remains a success story for us, and the team has also delivered impressive wins in other categories. In the UK, for example, we now have a nearly 2% share of the frozen ship market versus 0% this time last year. And in Germany, we have doubled our retail sales of prepared meals year on year in the first quarter. We will continue to invest behind these growth platforms to keep our momentum going. But at the same time, we will not lose focus on our must-win battles. So let's pivot to our acceleration plans behind our must-win battles. We have exciting plans to drive growth behind all our muslin battles, but I'm especially excited about the new news we have this year to grow our core fish portfolio. Fish is critical to our success. It accounts for a third of our revenue and is margin accretive. We are fortunate that this nutrition profile plays so well into the evolving consumer nutrition demands as a nutrient-rich source of lean protein that tastes great. It is our job to ensure that it remains exciting and top-of-mind for consumers, and we have a fully integrated playbook designed to do just that. Starting with advertising. Later this year, we will be launching a new master brand advertising campaign that reinforces the taste appeal and positive nutrition profile of our frozen food brands. And of course our fish portfolio will be one of the stars in the campaign. As these ads are airing, we will simultaneously be executing impactful merchandising activities to drive impulse purchases at retail, while ensuring the optimal value equation for consumers. And we are investing in our products. Renovation plays an important role. We are committed to always delivering the best quality and are currently investing in renovating our fish fingers to deliver more taste, more crunch, more delight. These new improved products will be rolling out through this year. Innovation is also a critical part of the plan, and we have a long history of developing better tasting, more appetizing offerings that are proven to drive consumer demand. We remain on track to increase our innovation as a percentage of sales ratio again in 2025. and fish is an important part of this plan. On slide six, you can see the new Captain's Discovery line that has recently launched in the UK. These products are anchored in flavor excitement and help us keep our thoughts fully modern with great tasting products and new varieties for consumers to spice up their dinner. Also on this slide, you can see our fish bar sub-brand of products, that we relaunched in Italy last year. Italy is an interesting case study for us. This time last year, the country management team was embarking on the same path that we are now pursuing across many markets. They sought to accelerate fish growth with a playbook very similar to what I have been describing. Our Italian team leaned in with a fully integrated plan. Strong media investment was overlaid with impactful merchandising events that hits relevant price points while being integrated with thematic promotions such as our Playmobil event. And it was supported by both renovation and innovation behind our FISBA sub-brand. You can see some of these products on this slide. And results speak for themselves. Growth improved for both us and our categories. Retail sales for our fish products accelerated to 6% in Italy in the fourth quarter of last year and rose 9% in the first quarter of this year. And while we're gaining share, we're also supporting category growth, which is up 6% so far this year. Fish Bar has been a meaningful contributor to this growth, and the brand is helping us expand category consumption with offerings for a snack or mini-meal occasion. Occasions where fish, and especially fish fingers, have not historically been considered an attractive option. We are seeing the brand's buy rate among existing fish consumers grow, while at the same time, fish bar is attracting new consumers to the category. We are growing penetration with younger and higher income consumers. We are breathing new life and relevance into fish fingers in Italy, and I'm excited to see what we can accomplish in other markets this year. So while the environment is not easy and we are facing some headwinds, we have a lot to look forward to. We are confident that organic sales will return to growth beginning in the second quarter, and we expect to achieve profitable growth for the remainder of the year and beyond. With that, let me turn it to Ruben to take you through our results and outlook in more detail. Ruben?