Treehouse Foods, Inc.

Welcome to the Treehouse Foods first quarter 2023 conference call. This call is being recorded. At this time, I will turn the call over to Treehouse Foods for the reading of the Safe Harbor Statement.

Good morning, and thanks for joining us today. Our press release and earnings deck, both issued this morning, are available in the investor relations section of our website at treehousefoods.com. Before we begin, we'd like to advise you that all forward-looking statements made on today's call are intended to fall within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations and projections and involve risks and uncertainties that may cause actual results to differ materially from our forward-looking statements. Information concerning those risks is contained in the company's filings with the FCC. On October 3, 2022, we completed the divestiture of a significant portion of our meal preparation business. Consistent with the prior two quarters, we will discuss our results on an adjusted continuing operations basis. A reconciliation of non-GAAP measures to their most direct comparable GAAP measures can be found in today's press release and the appendix tables of today's earnings deck. Let me turn the call over to our Chairman, CEO, and President, Mr. Steve Oakland, for his opening remarks.

Thank you, PI, and good morning, everyone. I'm pleased to be here today to share our strong first quarter results and reaffirm our guidance for 2023. Over the last year, we have optimized our portfolio, strengthened our balance sheet, and simplified our business. Treehouse Foods is a higher growth, higher margin business focused on private label snacking and beverages. Our strategic ambition is profitable growth driven by leadership in consumer trending categories. I'm excited about all we've accomplished so far in our journey and the direction we're heading. We continue to see a macro environment that supports private label growth. which coupled with our improved supply chain and our investments in our business support our guidance and our algorithm. We had a strong start to the year and I'm very pleased with our performance. Importantly, I want to express my gratitude to our teams for their hard work as we continue to execute on our strategy. Looking at our deck, slides three and four, cover key takeaways and a summary of our first quarter results versus guidance. First, we outperformed the high end of our revenue and EBITDA guidance by $30 million and $11 million, respectively. It's clear that we are benefiting from the actions we took last year to transform the company and sharpen our focus. We are driving better execution, and as a result, improved financial performance. Second, supply chain improvement and service recovery were both ahead of our expectations in the quarter. As a result, we fulfilled customer demand that was originally planned for shipment in the second quarter. Third, on a year over year basis, our profitability has improved significantly. as pricing to recover inflation continues to be reflected in our financials. And fourth, looking at our first quarter performance and our second quarter expectations, we are on track for a solid first half and are positioned well for the year. As a result, we are reaffirming our full year 2023 guidance. And finally, we are selectively investing in opportunities to drive organic growth and build capabilities across our supply chain. The next two slides, slide five and six, provide some context on the current macro environment and private label. Let me take you through those, and then I'll turn the call over to Pat to discuss the financials in more detail. On the left-hand side of slide five, you can see that retailers are passing along inflation in the form of higher shelf prices. While inflation is persistent, it is slowing in comparison to last year. We've seen a couple of items, like natural gas and wheat, retreat from their peaks. However, input costs remain at historically high levels. On the right, the absolute dollar savings of a basket of private label goods versus national brands is holding steady at about $20. This is significant. as it makes the private label value proposition for consumers very attractive. On slide 6 on the left, you'll see that the average price gaps remain above historic levels. At the same time, private label unit share, shown on the right, continues to grow. In fact, private label has now gained unit share for 66 consecutive weeks. The data not only supports a return to the long-term trend of private label share growth, something that we saw for many years pre-pandemic, but it also is reflective of the importance retailers are placing on private label and the investments they're making to drive trial and loyalty. Our ability to leverage these trends with our more focused portfolio, improved execution, higher service levels, and investments in capacity give us confidence in our long-term growth prospects across our attractive snacking and beverage categories. Before I turn the call over to Pat, I wanted to take a moment to recognize his recent appointment to the CFO role in a permanent capacity. During the last six years since he joined Treehouse, Pat has proven himself as a results-driven leader and He has made it clear to me since stepping into the role on an interim basis last year that he's the right CFO for Treehouse. Pat has a deep understanding of our business and our industry, and we greatly value his expertise. I'm looking forward to continuing our partnership as we drive sustainable growth in the years to come. With that, I'll turn the call over to Pat.