Treehouse Foods, Inc.

Welcome to the Treehouse Foods first quarter 2024 conference call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. To ask a question, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, please press the pound key. Please note that this event is being recorded. At this time, I would like to turn the call over to Mark. to Matt Siler of Treehouse Foods for the reading of the Safe Harbor Statements.

Good morning, and thank you for joining us today. Earlier this morning, we issued our earnings release and posted our earnings deck, both of which are available within the investment relations section of our website at treehousefoods.com. Before we begin, I would 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 these risks is contained in the company's filings with the SEC. On September 29, 2023, we completed the divestiture of our snack bars business. Consistent with prior orders, 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 the release and the appendix tables of today's earnings deck. With that, let me now turn the call over to our Chairman, CEO, and President, Mr. Steve Oakland.

Thank you, Matt, and good morning, everyone. I'm pleased to be with you today to discuss our first quarter financial results and provide an update on our outlook for the remainder of the year. But first, I'd like to take a moment to reflect on our journey and all that we've accomplished to be positioned as a leader in private brands, snacking and beverages. It was just 18 months ago that we sharpened our portfolio focus and began the transformation of the company. And our team has worked tirelessly to create a new treehouse. While the absolute results of our transformation are still forthcoming, I am confident that our strategy and execution will drive returns for our shareholders. We remain focused on sustaining and growing leadership and depth across our snacking and beverage categories. We do this by enhancing our supply chain and delivering superior service. This will, in turn, drive organic growth and create long-term value for all of our stakeholders. Let me start with our first quarter results, which are outlined on slide four. We delivered net sales of $821 million, which, while down 3.9% year over year, was above the top end of our guidance range of $810 million. In addition, our adjusted EBITDA of $46 million was within our guidance range. These results were burdened by the work to restart our broth business, which I will speak more about shortly. I'm pleased with our solid start to the year and believe that we are well positioned to deliver on our full year outlook. As a result, we are reaffirming our 2024 guidance. Pat will provide more detail on our first quarter results and this guidance shortly. Taking a look at slide five, I would like to provide an update on our net sales pipeline. and the significant opportunity for Treehouse to drive organic growth. I'm encouraged by the pipeline that our team has built in tandem with the work undertaken to transform the company over the last 18 months. The size of this pipeline has grown by over 20% during the last quarter as our commercial teams continue to pursue new customer partnerships. We are executing well against our plans for 2024, securing numerous opportunities since the start of the year, including wins in cookies, refrigerated dough, pickles, and pretzels, to name a few. These will drive growth in the second half results and showcase our strategy and action within the categories where we have advanced capabilities and depth. Moving on to an update on our BRA facility. As you can see on slide 6, our efforts continue to progress as anticipated. We have a plan in place and are tracking against it. We have upgraded our equipment, refined and improved our process, and have trained and maintained our workforce at the facility with the expectation that production will continue to increase in the coming months. This should provide a meaningful lift to our second half profitability. In the meantime, our other broth facility is performing well, and we have been doing our best to provide as much product as possible to our customers in this period. Next, I'd like to briefly discuss our supply chain initiatives. We've continued to invest directly in our supply chain to drive consistent execution through our network, enhance our competitive positioning, and strengthen our partnerships with our customers. Our teams are driving progress around our three priorities of TMOS, procurement, and improving our distribution network. An example of how TMOS is impacting the company can be seen on slide 7, where overall equipment effectiveness, or OEE, has good momentum and continued to improve in the first quarter. Additionally, our TMOS procedures are contributing to further improvements in service levels that we restored in the first half of 2023. We also feel confident in the benefits that we can achieve from our work across procurement, logistics, and distribution. With the timing of these initiatives, we expect to drive significant gross cost savings of roughly $50 million in the latter half of this year. Turning now to an update on the industry, Treehouse remains attractively positioned at the intersection of two incredibly powerful long-term consumer trends. The growth of private brand groceries in North America and the consumer's shift towards snacking. As you can see on slide 8, private brands have consistently gained share over the last two decades. private brand still has significant runway for growth, regardless of the short-term changes in the economic backdrop. Our strategy of deploying capital with a focus to drive market share leadership in consumer-trending food and beverage categories should enable Treehouse to consistently deliver organic growth. Taking a closer look at the first quarter, we saw continued strength of private brand volume compared to national brands. In the categories in which we operate, private brand unit sales in measured retail channel were modestly positive compared to national brands, which continued to decline. Additionally, on slide 9, you can see that price gaps between national brands and private brands remain elevated relative to historical levels in our categories. underscoring the value that private brands can offer to consumers. This environment continues to be supportive of private brand unit share, which increased in each month of the quarter. Indeed, our top line performance is improving, and our prospects remain strong, with new sales opportunities expected to help our second half volume growth. We have also made meaningful progress with the restart of our broth facility and are well positioned to deliver against our plans in this business segment in the latter half of the year. We are tracking against our goals with TMOS procurement and distribution cost savings plans, which should help drive margin expansion in the second half. Overall, we are well positioned to capture the strong consumer tailwinds we're seeing play out. And I'm excited by the trajectory of our business and our position within the industry. I will now turn the call over to Pat.