Treehouse Foods, Inc.

Welcome to the Treehouse Foods first quarter 2025 conference call. All participants are in a 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, again, press star and the number one. Please note this call is being recorded. At this time, I would like to turn the call over to Treehouse Foods for the reading of the Safe Harbor Statement.

Good morning, and thank you for joining us today. Earlier this morning, we issued our first quarter earnings release and posted our earnings deck. These items are available within the Investor 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 those risks is contained in the company's filings with the SEC. A reconciliation of non-GAAP measures to their most direct comparable GAAP measures can be found in the release and in 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. Today, Pat and I will discuss our first quarter financial results and provide an update on our operations and our outlook for the remainder of the year. Our results are outlined on slide four. I'm pleased to report we achieved adjusted net sales within our guidance range and adjusted EBITDA that came in above the upper end of our guidance range. Note that adjusted EBITDA saw a benefit of approximately $6 million of planned expenses that shifted from the first quarter to the second quarter. Despite this shift, the company was well above the upper end of our range, reflecting early returns on the execution of the margin improvement plan we previously discussed with you. While we are in the early stages, we are confident that the plan will meaningfully benefit results in the current year and beyond. The operating environment is clearly much more dynamic than we or anyone anticipated, when we last spoke in February. But we are focused on controlling what we can control and executing against our plans to drive profits and cash flow regardless of the economic environment. Pat will provide more detail on these results later. Next, a few operational updates. First, the team at our Brantford, Ontario frozen griddle facility is making great progress. As of today, all of our lines are running, and we are in the process of filling the customer pipeline. We are on plan to have this business in place to positively impact the second half of the year. Second, some comments regarding public policy changes with tariffs and food ingredients. As for tariffs, our manufacturing footprint consists of 22 plants in the United States, and five in Canada. All of the products made in Canada that are shipped into the United States do so duty-free as they qualify for the USMC agreement. That said, we do ship a limited subset of finished goods into Canada that are subject to tariffs, and we buy some raw materials and packaging from international sources. To mitigate this, we are executing alternative sourcing strategies or pricing to address these costs. With respect to the public policy changes regarding food ingredients, we have been working on reformulation for some time, and in some cases are already meeting the future standards. We do applaud the efforts of the FDA to establish one national standard. Shifting gears, let's take a closer look at the consumer trends we experienced during the first quarter and the categories in which we operate, which are detailed on slide five. For context, the Easter holiday was later this year and negatively impacted the March trends, which were the weakest in the period. Private brand unit sales were slightly negative in the quarter, which came in as a result of continued pressure on the consumer that impacted the broader market in addition to the Easter shift. We have seen the categories bounce back somewhat in April. This progression unfolded largely as we expected. At a macro level, private brand industry dynamics remain favorable related to national brands. As you can see on slide six, specifically, price gaps are healthy. and private brands continue to take share in this lower consumption environment. As it relates to promotion levels, what we've experienced thus far in 2025 is similar to what we experienced a year ago. As you can see on slide 7, private brands have been consistently gaining share over the last two decades, which we believe will continue over the long term. Treehouse remains attractively positioned at the intersection of two incredibly powerful long-term trends, the growth of private brand groceries in North America and the consumer shift towards snacking. Continuing with the discussion of the long-term opportunity on slide eight, it's clear that many grocery retailers also see further runway for growth in private brands and are making their own strategic investments accordingly. Aldi continues its store-based expansion across the U.S. with an assortment that is focused almost exclusively on private brands. Walmart recently launched Better Goods, a private brand which makes quality, trend-forward, and chef-inspired food approachable and affordable. These are just two of many examples that underscore the opportunity available to Treehouse to partner with our retail customers, gain share, and create value over the long term. I will conclude by providing some additional perspective on how we are managing the business in the near term to align with the realities of a slower category growth environment. We will continue to focus on the performance of our supply chain and our cost structure. While we've made significant progress in both of these areas, We still have opportunities to impact our results in both 2025 and beyond. The foundation we've built with our supply chain initiatives remains strong, and we are focused on executing what you see outlined on slide nine. We have visibility to delivering our commitment of $250 million of gross supply chain savings through 2027, with significant recent success across procurement, As an example, in this economic environment, we think it is prudent to focus on profitability and cash flow. We continue to strengthen our margin management function, allowing us to enhance our profitability by allocating our capacity to the most attractive mix of businesses that drives profitability for both Treehouse and our customers. This quarter's results are an example of making deliberate choices on bidding or not bidding on pieces of business that do not meet our margin hurdles. While this is impacting volumes, it is aligned with our strategy to focus on margin and cash flow, and the impact can be seen in our strong adjusted EBITDA. Finally, we are also focused on our cost structure and have undertaken some longer-tail projects on this front. Consistent with a low growth environment, we made some appropriate decisions to streamline our cost structure. We reduced some layers of management as well as consolidated our operating divisions to empower our organization to make faster decisions and to better serve the complex needs of our customers. We are focused on running a lean organization and driving synergies through a broader utilization of shared services. We also have an opportunity to optimize our plants and their capacity. An example of this is our choice to close our new Hampton facility, which produces non-dairy cream. In most of our categories, we have multiple production locations, which allows us to move production to gain efficiency depending on the needs of the business. I believe these types of strategic decisions improve our competitive positioning and also allow us to be more flexible with capital, focusing on our investments in areas that will provide better margin profiles and growth potential, all in an effort to drive improved profit and cash flow. I will now turn the call over to Pat for further detail on our first quarter results and our outlook. Pat?