B&G Foods (BGS) 5 May 202020 Q1 Earnings call transcript

Good day, and welcome to the B&G Foods First Quarter 2020 Earnings Call. Today’s call is being recorded.

You can access detailed financial information on the quarter in the company’s earnings release issued today, which is available at Investor Relations section of bgfoods.com.

Before the company begins its formal remarks, I need to remind everyone that part of the discussion today includes forward-looking statements. These statements are not guarantees of future performance, and therefore, undue reliance should not be placed upon them. could the subsequent recent more condition. SEC of risks to Form report detailed you future the and company’s XX-K filings that refer company’s and annual most on discussion operating We results the financial impact for a company or publicly or otherwise. forward-looking obligation revise of new to a whether as result no information, undertakes any The update statements, future events diluted be the adjusted will also making per adjusted non-GAAP net measures, company today’s to references base The call and EBITDA, financial adjusted income, sales. business earnings share on net comparable of financial earnings measures Reconciliations financial to these are the today’s most in directly GAAP provided measures release.

Romanzi, concerning opening company’s XXXX. quarter remainder for business highlights Chief Ken will the remarks Officer, for Officer, fiscal and will Executive and his Wacha, discussion results, financial selected Bruce thoughts factors well and company’s discuss the as the the as of the Financial Chief affected XXXX. results the with the for begin company’s the company’s call various then President first the outlook of expectations that

like I Ken. over to our conference now to turn would

Thank afternoon. Good call. us for all first quarter you. Thank earnings today for joining our you

find our long-term of commitment loved core values healthy more our success weathering to find and a company. COVID-XX pandemic. ones most and we I all, steadfast B&G to have and B&G and at and ensure imperatives a We think and ourselves it difficult valuable to Foods driven safe, the maintained Foods strategic make company times. extremely unprecedented by the you these in volatile this times your uncertain But through

guided make by every crisis, our following we this During priorities. decision is single

pandemic. lastly, products, financial our of of this the the our emerge right and long-term protecting when assuring of high B&G to unprecedented communities, demand, and investments from health decisions health First consumer our customer and quality and usual the Foods our employees, helping we and and ensure safety making level and of integrity meeting foremost, success

I will call, today’s cover On topics. three

safety I discuss in a of core all I’ll update the we and taking I for after our we’re our year. perspective outlook products unprecedented precautionary on to of will employees at and our and health comments, our At Foods, implemented our on and response provide the of this highest time the COVID-XX the measures our later a service values, all during remainder our with pandemic. the second, to quality priorities. Consistent year-to-date range of wide Bruce’s and provide will have manufacturing work are B&G actions First, stakeholders; our of the locations other facilities safety business;

Precautionary the include employees, measures others. has to and to maintain suppliers following our supply among some taken and that other Foods business B&G many to partners protect our abilities customers, products

and line workers screening and quarantine notification the COVID-XX; pay First, for top facilities; sanitation days executives of for to where work positive all test XX and table least launch the socially instituting of including their masks, tables, barriers times of the contact staggering manufacturing either maintain must and of quarantine a separating any shift rooms, shutdowns chairs the restructuring who least spots pay distant upon safety or XX each shield this the barriers close safety installation for who location employees; seating in plexiglass break at plant any at installation positive; shield the all days COVID-XX of the marketing of of COVID-XX senior proximity; a of of brakes; company for of before for COVID-XX locations; consisting procedures as force at tests including employees management of in of and employees, manufacturing of required all exposed been the and beginning in mid-May; distancing at work manufacturing our separations; are employee symptoms social X, and temperature any tested any manufacturing continued had least enhanced our wearing positive other at with checks employees locations, of all including the task manufacturing at establishment thorough have entering sanitation at for policy with at date with March may June work-from-home who XXXX. office COVID-XX workers proper exhibiting who pay employee XX have employee with to plexiglass the

our productive early results and actions very and we’ve few aggressive with positive has widespread employees believe in keep no infection. the and facilities taken our We helped test safe

we managing While from employee the that unprecedented to safety our increase is our ensure we in are aggressively meet production also demand customers. can highest priority, our

working been food to producing disruption. delivering supply with have maintain teams and nation’s minimal help products Our tirelessly, the

have rapidly employees dynamics been responding to driven consumer rapidly and manufacturing agile a by in market changing brave changing behaviors. Our

impacted. employees thanks employees, of date ability our has heros the frontline are Our customers true this our pandemic. serve materially during not to And effort tremendous to our been to

more our was two demand peaked. XX% of orders fulfilling customer month last the fact, the the rate than both for for March when and service strong, In for surge weeks all

declined our has this here pleased continue work we’re XX% of This chain and without communities be to service supply difficult would have valued While the rates who with strong. serve April, declined our increased we’re our doing nation’s demand, customers time. not during in food B&G local and that our below part to team continued possible to just at perseverance hard the amazing keep

through employees and and team rewarded bonuses managers responded for wages and May $XXX to this We hour we’ve with by that unfortunate proud per supervisors our as $X employees well. least has up how hourly March of are during dedicated to of provided manufacturing time our incredibly by XX, increasing crisis, XX at from

employees receiving keep our We grateful for stocked. very their our greatly customers to appreciate the our recognition who are also shelves employees are from efforts are going the

the of from customer. just recent to share note the receiving our top following true example team highlights a our provided the I we shop send products customers of the that over The type as we’ve to has some your stores. been received of we from value upon like past of through partners. availability wanted us "I at for feedback work would an the many note retail touching month you are of just a a

Your from trenches and to me commitment over team visibility has awesome. has above up-to-date the work The your been best-in-class." employees’ most give the done been has

to Foods, customers. been prided attitude ourselves see on has competition. delivered At have an and B&G tremendous see has recognized the these employees by we amazing our and the always the their real-time to efforts results It of our our outwork willingness team such experience can-do

positive the efforts these of for results generated All very quarter. first

the in costs, economic traumatic a that led the a it, significant will for its human continue taken COVID-XX society at distancing as some of regards and While staying combat we the with has to been onset period extended and increase and social particularly measures time. of in meals has level have home, preparing pandemic we eating Canadians their Americans and at home. at to an trend this expect And to

that a Foods Our of frozen turned which has of to are the have constructed positions with to health time our solid brands some B&G and even brands, XX And questioned store include B&G portfolio over these the at products stable Foods consumers have while in center in they and the been in trusted vegetable just a of compete. foundation categories crisis.

for million more release of $XXX.X X.X% earnings saw today, likely year. last quarter, our net compared $XX we than the sales earlier reported million increase you As an of to or from

exchange of delivered the activities impacted operating despite last We reported provided tune of negatively EBITDA million increase compared being for an to to XX% cash to by million quarter, $XX.X year, the foreign or by of adjusted $XX.X an $X.X nearly X.X% We of million, increase million. nearly of $X year. compared last net

the for first we had we continued our quarter. In which last the start resulted the in earnings thing execute As business. season the non-holiday calendar, softer our line promotional work retail expectations trade on partners we although to the performance year, it right February, January modest highlighted strategy top our for optimization to to with was call, initially and during

the build holiday. we By track, we Easter were early to sales on March, began as headed back momentum toward and

half immediately keep first chain gears began we During environment to a different outbreak supply coronavirus. March, our task of realized the in quickly were shifted that following At and the we point, the of we very that would become what the that ramping doing time, same production for were to ensure to up demand could employees we we ensure products. at satisfy our we unprecedented safe while the to our best that

of We In or percentage throughout Giant, Victoria than Ortega, with ahead of the but of volume, company Cream fact, was to our increasing year April the strongest Bear the in pantry our a term, net four only $XX net the consumers strength B&M, continued Girl, long were week almost consuming million that of experienced with March sales last all loading and more some strong B&G Wheat, consumers of Green the been last Contrary sales. more large have than Clabber ending the of Creek, especially for Underwood. more XX. driving weeks in for month brands, $XX million week April sales belief than history XX% of performance increased

the Now for strong B&G the specifically open quarter as retail term, XX%. ending weeks and in XX Foods long last of show This March of driven by consumption the through quarter and by long all XX% weeks of by growth five-week services the April. the a to and was expect driven level second the March in sales by second while see outsized middle the orders our reported we quarter. by strong don’t increased driven Consumption, XX% through plus for as performance two March Nielsen plus May same orders middle outperformance similar of XX, of

all more March the last In XX, XXX% ending products fact, week than year. B&G food doubled versus at of consumption for

Foods last doubled April consumption month in XX% home. beans, These retail-oriented brands brands trends including meals their to of is current weeks continued April, Victoria XX, are with canned our very in B&G or March, baked trust Several entire B&M their year a baking strong the at consumer a popularity Sueur consumption Giant and powder, American of doubled trends a Total testament prepare advantages versus the Le more McCann’s. business strong largely consumption portfolio in distinct this as North up nearly consumers and environment. ending have year. utility with B&G the and four vegetables, Foods our Clabber Girl for Green and with nearly Underwood, ago

However, our we service in softness of food our net business, represents approximately XXXX. which sales have in experienced XX%

eating challenged people continue expect shelter place, will our food that sales We away-from-home as in and service remain their options limited. remain to

seasoning mostly Some Maple brand, decrease and in businesses sales include of our spices B&G business, Don Farms. the impacted foodservice Pepino Grove by and the

business success. long-term and building do strong, trending While our we pieces innovation our overall recognize to critical brand is very remain

and timing the innovation due the focus shelf existing to this while the plan retailer introduce new Any plan on of investment we getting And manufacturing somewhat resets to we other Bear their Creek to success. mixes, of up our loss to sauce current Victoria delayed first, of made be to the Green products in reset products step-up will against movement ensure and from All be vegetables, our more like brands than innovation B&M, delayed delays and consumption will sales frozen stable canned in trends Fruit, Underwood. Giant pasta and the soup Polaner year core

and frozen Giant continue are Cauliflower of in began XXXX in Breadsticks, Green Pizza average Green where Our Giant Hash there. Giant that Green of ACV with to with Gnocchi, Browns, XX% distribution we already Veggie launch in Cauliflower well of Crust, largest Cauliflower the the very Green an which is Green in Giant Giant will innovation performing fall we and vegetables,

the as will as name addition, us our expect add a about Green brand excited more fuel channel. Giant In are acquisition as recent we natural our pipeline to Farmwise well for provide we innovation appropriate very it

cheese, product totally in to Bacon. we and cauliflower based varieties, leverage on an Rings, Green Veggie rings. french free cauliflower and These broccoli our called plan by and Veggie such Green onion with new varieties and come including this onion zucchini will Gaint new parmesan, of introducing bacon cauliflower as cauliflower cheese fall, a This take and innovative Giant garlic acquisition Farmwise Fries, ranch along

brand the as year a in well. mainstream the later brand, this natural few channel, plan plus retail customers we the Regarding relaunch Farmwise to current

being to On acceptance chickpeas. the the alternative we canceled in has this sweet ACV will a peas year-end, of anticipated to from dry due targeted been launch Retailer be by Green made traditional grocery plant-based rice rice shelf-stable throughout a version to XXX% continue side like XXXX less to business, XX% expect very of of innovation lentils, due of goal with to and resets delayed lagoons and Giant a good, veggies, of building but than XX% the category ACV. we or COVID-XX,

is as brand received taco Ortega shells have been line it’s saying the and with of in Giant, category Green they’ve products well sauces. by These of the very in cauliflower innovation quite ahead real by the moving the outdone with them be some to time. customers Not new street tortillas introduction many taco cauliflower its our of seen as well first

We a less resets, in expect also to goal year-end, of than anticipated continue this but to we achieve an expect category distribution average XXXX with by due ACV build to will ACV. XX% XX%

the we We off it’s this alone, we this growing estimate is need in And additional know XXX% progress which completing less space. in more e-commerce. foundational investment of really content with area e-commerce and make our will friendly the needed sales in and business. and our than we improved packaging X% competitors XXXX, this taken Another product on innovation imaging, make capability had digital product up on data, our to offerings our our year quarter, By past than work e-commerce plan our e-commerce end to of Amazon compliance. by in although catch of building data significant at we many improving to

combine investments and engine sales our build with search including banner chain marketing, e-commerce supply optimization greater activities. along links, marketing this media and to stores other increased internal program, with out amongst shopper will investment branded We social resources ads, including in a personnel,

been and a crisis. of that and in this of long has which during time only work accelerated Foods we B&G the has Lastly, communities supporter live

they’re No electronic relationships In in raise using media charitable billboards awareness Hungry, social Hospital, York, along addition established Square, and Times causes. partnership America our New our very channels Jude’s Feeding and with with our Kid these to to St. we’ve help with important for

and for is trying successfully keeping managed unprecedented In the far focused summary, year, quickly adaptability our these times through plan to then company entered B&G which very the time determination we Foods so our which respond our and return in exercise the going has with they on later executing will the highest an by known more world. priorities, to confident proud our provide of performance on about path terrific can I’m country I the quarter first our detail forward year. remainder our employees, I in and and to extremely thoughts continue Bruce? their our of to am forward. perspective and

Thank afternoon, everyone. and you, your are that Ken. and I families you hope Good safe staying healthy.

our employees to their like also my of add thanks during incredible dedicated time. B&G team all work would I of begin, own for to hard I Before across Foods this

the the call, in combat the that human in regards the while of earlier social mentioned society has with a an coronavirus as it, Ken staying As and their led in to measures have onset been its traumatic and at we to particularly costs, significant taken of economic home. to this at a Americans level time. that continue expect And is to we increase and home, eating at has some period meals preparing for extended distancing something

the and month, This very terms of strong economy. frenzy to EBITDA. which large two and coincided of of the the our products happy given the our with types that the consumers we over help Not of brands America. of the country’s this net in exactly distant are environment, adjusted gravitating a we first and frozen weeks the portfolio demand stay-at-home in and to and These our growth establishment portfolio time of policies, shelf-stable brands finish brands, current our to to of by mandates to sales and of doing broad final are for the driven constructed a portions are shutdown feed quarter of products be We range vegetables. in backdrop of was March outsized social had had part the include products surprisingly, XXXX, and with

quarter our as We incremental year. quarter through of of call. throughout diluted more share and these of this of a in EBITDA expected that bit little a in million little a continue which demand EBITDA we beginning April quarter the generated sales. by that Absent earnings expectations for our adjusted $XXX.X Adjusted of for sales quarter, for far a $X.XX, than have have with is We and XXXX, the net are negatively products net than have FX May. as In I in later the into the million as year. of the on line some costs, the per greater sales spending results heightened adjusted was will beginning with associated reported as walk the of percentage we EBITDA the XX% the first for EBITDA of $XX.X in adjusted seen approximately of adjusted XX.X% impacted $X.X discrete net million preparedness coronavirus we about for million, were well would and percentage $XX and

sales benefited business versus in ago of the of the or an $XX.X XXXX for year M&A The May increase period. and acquisition of increased sales, the Base $XX.X Net XXXX of contributed net to million by million quarter company the Girl excludes the approximately represented which impact quarter or sales. X.X%. net $XX.X Clabber of X.X% million first

of quarter business. inclusive of First program. approximately sales optimization from These base were trade benefit XXXX list spend our of $X.X increased volumes approximately by XXXX spring net net wraparound in by price $X.X increase benefited pricing million from and complimented pricing the our million benefits our

we of the final increased seeing reminder, really began tremendous are from see benefit while only of the a a quarter. benefits onset consumption two these we the the to As following weeks coronavirus, in

driven net innovation as Frozen Green our products. legacy Veggies led SKUs Veggie net million frozen our shelf-stable or bag and driven was well Rice saw Green our growth frozen net in products. Giant Green by Giant sales Giant sales as Spirals. with as innovation growth and well our primarily and We outsized $XX.X our was Green quarter. by sales power growth both in frozen innovation core Frozen Giant XX.X% performance by lines the as increasing of bag-in-box

the have While in innovation occurring are fastest the focused delayed aisles as the our shelf. been on items turmoil XXXX that many grocery as on result of their and is of largest launches turning partners keeping a retail our

increased our leader and Among or was sales brands, other net $X.X large the Victoria by million XX.X%.

American another New business by or or and seasonings by XX.X%. increased of or the for $X by Ortega brands, net $X.X the Unlike Grove we York seasonings that such million significantly. increased by Style down or economy. Maple $X.X weighting, XXXX the Dash foodservice and Cream by increased sales Wheat have of quarter, the legacy down a and is strong negative the in X.X%, drag performance. were business, our as coronavirus resulting X.X%. increased and $X.X $XX.X seen negatively majority our portions has million Farms of spices of and million were This and Net million our area or Ac’cent, sales were surprisingly, of acquired inclusive and shutdown one X%. sales on our of large spices where had we And not business, impacted net the these portfolio significant a significant million sales XX%.

mid-May also Girl, which performed in Clabber acquired well. exceptionally we XXXX,

million call, year. $XX are time $XX.X the business of same at year the the approximately earlier last in the we this prior and million net business Girl period sales purely sales first watch incremental. the that’s while during sales under last mentioned The I Clabber net in quarter, generated in ownerships all own As generated and didn’t the during point

momentum our which increased sales like XX% net also portfolio. increased by net outstanding by Net first quarterly other $X.X brands Irish B&M performance sales Oatmeal highlight I sales to the McCann’s quarter. would million the some or $X.X for Las increased to in as performance had of in XX.X% our of million as our Underwood $X.X by Mama or $X.X sales sales sales continued or net Mary’s or and acquisition. brand net $X.X that Palmas, million increased or by increased net million XX.X%; XX.X%. such XX.X% build Others, by since

Gross of $XXX.X or million first was for XX.X% the of profit sales. quarter XXXX net

of million quarter non-recurring million of quarter first expenses Excluding Gross related profit XXXX, net acquisition, impact of net $XXX.X million during negative gross XX.X% or of the or of the sales. of sales. XXXX $X.X have for first the was divestiture $XX.X profit and been would XX.X% approximately

Excluding during XXXX, of acquisition, gross net XX.X% first the million divestiture million impact $XX.X expenses or negative and of of $XXX.X been nonrecurring quarter sales. of have the profit related would

of dollar of first $XX.X decrease administrative of consumer of sales $X in which or slightly and improvement almost and sales. million and composed administrative administrative The and Selling, dollar and expenses percentage general X.X% prior of $X.X was million net a $X.X million expense year Selling, as XX up marketing in $X.X of million. points. net were general M&A in million, XXXX a of $XX $X.X were million sales, of expenses partially quarter, net general the increases decrease a quarter of in selling the by an of X.X% terms, expenses quarters’ the expenses or but million, of offset expenses basis increase warehousing nonrecurring in was

in EBITDA million on of the year is Brand lapping XXXX, and quarter was the XX% generated performance one consecutive year of which represents We $X.X for quarter Adjusted of The of finally our last the anniversary expectations divesture increase adjusted the follows XXXX. of with year XXXX as full $XX.X period. a last million in year. the increase consistent quarterly first of in in of the our for million $XX.X first EBITDA, sales our year in prior which EBITDA our adjusted quarter net compared to adjusted second EBITDA fourth percentage Pirate

necessarily we by outsize an the incremental seeing sales the in adjusted unprecedented in costs haven’t increases from driven we some and growth associated While the seen in margins are EBITDA, net sales with increase coronavirus. representative incremental of

workers. in precautionary enhanced factory screenings have of For we workers, are example, facilities cleaning for our our for additional we and paying compensation engaged factory

EBITDA would nearly than million charges, these delivered of profits. which EBITDA net we adjusted our in more have during of in bit depress increase approximately the sales. losses to little a related quarter, million an related as to FX and helped $X transactional a percentage adjusted had to $XX we XX.X% Additionally, Absent

age of rest our expect the the largely operating to on also increased expect of leverage net the the costs. sales in year, enhance we factories of coronavirus corporate associated elevated and While in operating these our utilization structure costs we our throughout with offset

million used Net prior period. in first expected interest during year negatively Net the acquisition fund Girl as associated largely our was XXXX, last notes. million that $X our as repurchases increase of of interest year well $XX refinancing of of an impacted debt higher to over of borrowing was our incremental the primarily the Clabber X/X% share almost expense and quarter last with the to due quarter, X was cost

some rates, expect do create lower term LIBOR as rate which Additionally, XXX we for in us have while interest the half also the in quarter a our carries an of increase drawn right on Separately, take our of in we should has points. more result to of with the revolver our of plus a and year the regards back to measure, $XXX decision the interest see we than end basis result as help expense. at company that precautionary benefits were favorable loan the involved sitting million on cash which for a to

rate As and a $X.XX adjusted or prior tax reminder, basis diluted in placed cheaper. $X.XX LIBOR of share year earnings in effective performance to loan was adjusted in last earnings today our in X% and at diluting the benefiting year lower count. quarter XXXX period per first improved from in a reduction XXX share compared points operating per to approximately the share approximately when compared term We we generated our X.X%

operating first million quarter the versus by and fiscal receivable, the for in a at demand million at inventories end million offset quarter the was $XXX.X to than led decreasing inventories to the at expected very of two $XX.X XXXX provided $XX.X of the activities the with $XXX.X cash an The sales end million to for unprecedented the greater with generation at of part $XXX.X for quarter. $XXX.X This in to those as net their the fiscal accounts particularly expected quarter products weeks first from increase XXXX million end of end strong of benefit million XXXX. million in XXXX of of the with from in XXXX. at quarter end final the the decrease first quarter of of in our Cash compared $XXX.X was first in

Finally, our team of first it followers no Foods Board B&G should XXXX, long remain surprise policy. the in of of Foods on consecutive Directors and to Directors as our B&G time XXnd February the long-standing Board share. declared dividend our management quarterly our to that of quarter, $X.XXX And dividend come committed XX, amount during per

Now, would XXXX. our for I touch to expectations like on fiscal

range $X.XX materially $XXX.X earnings of $XXX.X to for know, million more range on issued range of guidance you share As expect exceed be XXXX. to the $X.XX. we be million the to for adjusted the called diluted Based a guidance be ago $X.XX to two in results to net XX, to that and per on in our through today, February months to we sales little billion, than EBITDA in that the of billion $X.XX adjusted

will to sheet. that of We improving increased our results P&L and believe help flows balance accelerate the us drive deleveraging also cash

stay-at-home business the and coronavirus social affect factors, second rest mandates will States of impact wave duration and including, ultimate the depend America. North of our However, the and will United third coronavirus distancing a among of or others, whether the on on of the many

the ability to may to habits. to which and impact the Our pandemic continue our company’s from operate chain of supply pace and resulting conditions disruption the and recovery subsequent eating facilities the macroeconomic maintain material consumer without manufacturing our extent

XXXX. through quarter, and ending quarter strongest the be our that net and will momentum more than to for unable this continued on net larger more compared at sales fiscal that our we time, May week this are the May the April year and or as Early time our performance however, And to to be second provide million the guidance coronavirus by the We year. third also expect estimate quarter suggest $XX have do, full last sales had company’s of strong results. fully XXXX increasing quite into unable XX% continued for quarter the in XXXX. year, than the to with to outperformance. the ever, net sales than we XX, are remainder that robust and remainder materially we impact has We therefore, expect of of finish will second of indications April in At

said first We substantial even second cash that we right net to payment we through starting made have from of at markets continued lessen, work end assume $XX of our and are and being have in has our country. reopen to to generate our the and the last way million restrictions increased million into That now, stay-at-home position quarter, approximately week. quarterly today, account we parts the we as to on starting sales incremental as $XXX from the are outperformance approximately know the peaked that certain these dividend taking after million $XXX may cash based everything quarter

the we We which from and away but hyper evolve. don’t moderate will we seeing expect begin to work-from-home home, to restrictions time policies eating return are pace know meals growth the sales of to and to stay-at-home as consumers as some net their over today

at will continue economy the to crisis from expect economic experience to persist on away-from-home consumption anticipated our that with previous for that broadly and this downturn based to time and see we is after the point. a meaningful with reopens growth downturns, due at-home economic consumption likely some However, shift modest lasting

we also foods. portfolio to grocery. high-quality Foods tasting, of shift U.S. expect and Also, Canadian benefit branded B&G We weighting towards our traditional a portfolio great retail heavy have see this given

partners, the key partners. and and customers keep our demonstrating chain our to can, our our the fill to as as expertise has long-term brands we logistics rates been leveraging shelves our supply focuses of on retail our One historical best importance and maintain products to support

also on our users experience. their we consumer of While this have focused and utmost improving is been importance, end

of demand have We seen long-term consumers from products. our tremendous

consumers this increased for consumption, better shareholders. this We and positioned new coronavirus out believe seeing come that are and over the our certainly We leverage of business, translate believe our to grow we demand also and value heavy will reduce during of time. increased trial we period period into will generate

could our On that performance. we the do some limit the coin, factors of other side have

brands. we We selling most are for our currently produce everything can of

our of ahead full co-packing partners. factories Our steam those running are are as

a really particularly pack all supports so and working Green demand. Giant, are our lean We to of that with that this in also can satisfy we standpoint with regards our suppliers, seasonal production from

consumer to Ken our manufacturing And flatten to and distribution continue coronavirus our an as our terms dedicated we and been employees precautionary blessed other chain, our in more difficult have readiness our we the able and in taken supply our adhering tests. both of to we thanks safe, date and to and very keep in invest other in have the employees of policies, mentioned disruptions limited those been and part to We we acceleration earlier, efforts. manufacturing to each do also additional very have to measures manufacturing this curve of help together, facilities cooperation proceeds with in And and marketing and importantly, time. reinvest at manufacturing e-commerce incremental expect to few expect some of the

in are incremental that believe there year as brand this to the that will extent providing while year which cap get So our to additional risks exceed materially We could plans you and we two make coronavirus will cash look not results. in last ago. coming incremental we with upside to to performance also investments insight while months that the the flows, better our e-commerce a will we months unprecedented will societal changes and unprecedented the associated for to our the provided building we of we to full just for as do of our the expectations remainder resulting with forward demand understanding impact that guidance preparedness, products in fund anticipated and know increased we while plan our do look and environment this we operating long how

the now over call like would to Ken. to back I turn

you, Thank Bruce.

is pandemic the to at While it. we the coronavirus stronger than built us positioned foundation come evolving, still B&G crisis Foods has we of entered believe that the out have we

and have eating As toward home. at consumers we Bruce elevated gravitate performance more the and throughout believe crisis while cooking we mentioned, will our beyond financial products as

plan take also brand We incremental preparedness. innovation behind to make investments opportunity and to e-commerce this

that consumers in eating trial consumers previously. believe reaching the because optimistic set at is are new increase we were We home among we in not of resulting a

our since new buyers shows believe brands. into XX% fountain food research buyers franchise. percent to total increase new are and uncovered consumer news due a encouraging regarding amongst ranged brands, to like that new Our research the to our food brand COVID-XX youth from We households has of B&G the consumers outbreak XX% bringing in

the or percent to time significant continue new result, XX% appetite again, a Encouragingly, across brands. XX% XX% brand buyers buy brands. our we’re of range increase to to who plan a have by increasing an intent seeing buyers, repurchase from new buying a As buyers as during in among the they our brands from volume indicate new of strong to this XX% estimate our between

retain So possible. these is going hard clear. new of We work forward, job very as to as must many households our

our outlook for our for consumer time-tested updating the and employees difficult all powered flexibility over to So that commitment by most in excel these XXXX, meantime, healthy. trusted progress home friends we’re I changes and and to our year. safe preparing families and of pray look you at brands, during even of In behavior, stable times. about you the We on of remain our ideal course strength, of forward and and optimistic meals the the your

our This call. Q&A we’d like portion now Operator? concludes our today. the begin to remarks And of

first Our comes Andrew of Please Lazar ahead. Instructions] from Barclays. [Operator go question

Ken well. doing if Bruce. Glad to afternoon, could. I Good you’re two hear Got questions, and

X%. of and I then kind there a week follow-up. for consumption shipments can And that growth know little think, sales hoping drawdown. was I’ve The first a have XQ, inventory ahead up of a bridge little that between I was just bit. obviously, overall any and that any the I one. consumption if guess you us well was one inventory just or two little got obviously in to had over I of those quick of I a period, increase differentials, ahead And in is organic could know was or couple so. of XX% you you more mentioned overall retail a don’t due of levels.

any see we Well, inventory…

the of – part think I sorry, go ahead, Ken.

No. Go ahead.

also, we is Yes. Andrew, Part of in sales saw massive April. it

you little be bit there may referenced. so timing, And a a of as

as we through just busiest continued demand mentioned call, then close our week to April. on strong So March, the had, and out Ken ever

maybe catching shipments up. of just So a is matter

foodservice lagged soft a year business, part would of have a soft bit continues out we big strong, and our little very was on be consumption Also the really soft. because shipments our not March and very as was mentioned, in although started to business, and then

net the growth. that our than our business, numbers be So total less growth consumption a of would driver shipment of being sales number

the have. we’re it’s shelving for you retailer incredibly historical also everything guys hearing, Got measure, obviously, they basically any assume obviously, what true interesting it. is by same just And I from are inventories that is low they’re given,

or inventory some I stage very And anyway, of So about like to time unwind would interesting know, have worried be inventory to also at retailers don’t that’s it goes But assume one as forward. people some of at have even point low. inventory with your consumption think sort happening though retail might clearly at what ongoing there’s are this I going an maybe even of home, on. as pantry reappraise to If restock are big will levels well. are look something, going people level

weeks. pantry We because great most are are come back there’s de-loading consumers back going right. within and of research very, a to we’ve frequently be that a you’re to heard based coming don’t of expect percentage how high people research, people very degree seeing that we’re two shows Well, on

was data of that that they’re their stocking doesn’t but for through suggest out rates all time. bit We So in it’s not think consumption are There grocery and March, don’t pantry. in staying And continued in periods in little of store April the strong order long consistent. mid-March, a then, pretty been that is doing spike – just probably people May. our of the since

of appreciate think, of to trialers, as all even yours the you food I how and more – that interesting some this packaged of really successful for Because to end new interesting, brands be trial getting in and will, if remarks going is a think towards around commentary permanent I of and I repeat. I you your prepared Yes. and more track lot your converting sort of many others trial that’s consumers. those are be portion can the are mean into

through couple cover a numbers Can more. of – a bit was and but I you you hoping quickly, little that could you just went pretty

just of are any what look is maybe all versus where And assume current be that would really – still the pandemic So mindset, come things parse guess how that sort sort of could of normalized it’s will, in survey data sort in how consumers. comments that consumers I environment, when you data sort does of more we’re panel of from? do repeat Just I where a there a if of type like? helpful. you out of much

that some It’s some also of Well, resources, do data of the we came our something this from didn’t third-party came from we new ongoing. time. but own do research it consumer that

drive we’ve Easter even saw that seen higher So than for instance, But see past. increases in that brands ever tend news jump usually was period, bigger seasonality during we very we interesting in this and time a encouraging the to the given year was during it frame. households – the that the

So it’s encouraging.

should you them can impact. new to time Any of thing that’s can retaining time a have any just households, fact, do. household, get positive get new In very hard some you a

while to won’t "normal," to that sales we when to return can rates – brand going growth going get seeing project like so we’re certainly monitor out well, to product. a closely now, new include want we this this we’re So our things forward. in It’s the have that forecasting just we –

measure project a take you and repeat the you be. and volume what can out You and measure trial new product you

product. like So new a new old a an that’s household brand, on

disciplines of kind to the brands. So determine apply we marketing effect those on to long-term the have really consumer

Thank you.

Our Palmer of David next ahead. question from Evercore ISI. comes Please go

Thanks and good evening.

to we of in shipments, more It orders you’ve growth spread strong upon X growth or stuff. from might comments the of continues growth the might like by be on if you for numbers be of to XX points, XX% you’re on just seeing terms quarter, based May were on that shipments. like pretty that of so April of saw we although But very your your over obviously a remarkable for consumption Your XX, for similar the to points out and the looks numbers the consumption based consumption that’s as be light April shipping some based XX that whatever. shipping that type demand said, about swung May, points under

in shipments I So And point? of terms going outpacing do do think see end inventory? And you at with why consumption – follow-up. have you do do see you how playing this retailer this think And is? a that out how where you’re quarter to you

Yes.

match I all the careful. the not numbers. by think you consumption have business because The to is exactly of always measured don’t be numbers

them over You look time. at to have

we had my So and have We you could we in Keep listen carefully – below XX.X% more, over dropped our XX.X%, XX%. shipped to pinpoint mind, in rate to exact fill. shipped if numbers, order you a order the can’t lot April, if numbers. XX% our historical growth fill

unmeasured shipments numbers So to one and – between and that There look customers. at month shipping the the demand is there. really you And can’t are exact or have same and channels go consumption. unmeasured

And on of opposite that. I course, the effect has element foodservice talked the before

we’re and into will happening they them forever, we mean, of last of believe we the this and now our are as third May today, to with so remain attentive strong. our that’s the can orders so don’t we’re far, – – order – what’s open patterns so week with we and see why but So, how I

have our own been dramatically depleted. So inventories

And that – now, chance to like meet to But spike in to we’re we’ll traditional rebuild things producing XXs inventory everything rates sell. do. continues. of we as producing to we to Bruce if this said right demand customer everything fill some can normally our actually a high can down, we’re So want we when slow our we’re rebuild the have

in Thanks our about terms ones modeling for two going think just quick of we how that. And forward. then should

leverage, to this incremental this April. just about being similar sales, that $XX by EBITDA sales wouldn’t quarter, of million numbers, we round we or you incremental You $XXX that, would get margin revenue get a be in If type million just of in sales the the $XX it’s of cost. talked would to million co-packer even of say of past? were about believe a model going part you large a to in $XX think but cost made leverage some of your wouldn’t Bruce, new that even business, at not that being still or hard in EBITDA offset month though million with like which be outpace that number, your – of had to of should the to the comment you growth something you – your

So we any cash comment impact about think how of about would free would year, on that think And on. Thanks. that unusual this that? you conversion then it And would for EBITDA thinking I’ll for flow pass that? XXXX? Anything

answer more leverage be co-packers. Bruce let see in We do business do detail, I’ll through but of volume not our to our clear, co-packers. with we half about

– rates extent. our a great So to

own in off – we incremental volume the So to our well off do volume. of doing and as leverage business margin our of higher But Bruce that of there that – about is that mentioned, half costs. there see get to are manufacturing, expect

margin time have really those costs. that, that to a right we now increase lot it’s and will cover a sales, will materially in unprecedented will increased we So have but pinpoint of

the cash it to from should cash I because that a be the in sales. so means would think were And And margin Ken’s point, things if happy are XX%, XX.X% area, we we standpoint, going well. follow

pretty We’re efficient always standpoint. a cash flow from

earlier, dividend around I than first in and paying we $XXX more $XXX with after in cash, a that’s the million were We the bit – on million little on today a call sitting payment. somewhere quarter our little cash. As said finished

Thank you. Okay.

next of [Operator Reuter go comes ahead. Instructions] from Bank William America. question Our of Please

is taking question. Bill. This Thank for for on Mary my Hi.

that First, do any And shift more private environment. their increase away just towards Have become on value? label? you or consumers as private expect label from may focused on seen you share

and increased should to time, grocery a there’s demand demand food at in that label mid we been private percent private some for home. for teens we’ve are think as for label, there’s to U.S. increased eating I people of expect think continue. and branded and I high that And

how you lastly, are revolver far Got And as your balance? then timing about as repaying it. thinking

the as just to watching a whole as going down on continue we’re think world bit the evolves. the the side. things I a through, to drew monitor to little how precautionary matter started sweep on we’re revolver be safe and We to coronavirus

Our revolver is L plus cost we’re from XXX a cheap, fairly standpoint.

Thank you very much.

comes next Wells Bryan from Securities. go of Please Our Fargo question Hunt ahead.

around generated there April, amount thank is a cash. $XXX first you the significant I some the planned of your well you’re to you incremental plan you over cash your in question on any discretionary and e-comm windfall discretionary doing could If incremental cash, today? it’s you My spending you put given heightened of as some plan for bands putting think Is the month as Thanks develop on in on way time seeing you million. kind of the work about to detail. excess have marketing

brands, through increased continue we to an in so opportunity build as while we I hurt it’s but going do we see demand. I develop think it’s going this good to going from the capabilities. it’s a do where material that from to we’re necessarily, think timing and let generate a think to to to year our year standpoint, e-commerce continue be our work we’re invest benefiting And the opportunity cash. margins to don’t to continue

take throughput in for again, may the you us of your for the can that a second to very do on your opportunities see you guidance what my and/or advantage year? to work is high-return time. you And have the cash given to is, windfall? improve put any CapEx that, have, Okay. CapEx question Thanks short-term remind money And you opportunities

And investment opportunities there. was a $XX CapEx Yes. in number. was still those million our some of probably has fair That’s probably guidance. that

If last our implementing ERP you system. couple were think the years, about we

largely that’s so done. And

from on feel putting And growth already money that work some are pretty anyway. number. a so We standpoint we about to planning good

Yes.

lead no there efficiency are those in answer specific facilities. a things our to also do. included projects. plan to time Our to and investments on are throughputs turn short-term But can things that dime drive your question, pretty long Normally, we

minor some plan with variations with nothing to indicated we can, but major. where staying as capital we’re our So

and luck. All your for time. right. thanks Bruce, And Best healthy. just of Ken stay

from comes Karru Please of ahead. go next question Our Martinson Jefferies.

afternoon. Good

Just some that down on on part, mean the XX% seeing to or foodservice has the are sales, that? on throughput that where zero? of I today? – we still And grounded are you

foodservice are of come seeing think get back zero. it business, was go restaurants certainly, and to it back out the to Not spice people start work, sales, We still And saw you with our home. will as I to but that back at go down. stay

And of small so business. for us, it’s a part the

of So we’re a standpoint. a getting drag the little bit a grocery foodservice branded standpoint. large a benefit from And from retail

be Okay. so today de here to the you that making, had front it’s a great investments not in Ortega reallocating demand wondering, are given may Mayo. terms that strong? opportunity Where you’re in sell-through. And the is invested would dollars that just have Cinco of end marketing the

something. it like normally did with driving we does. even de that was was – many back order certainly not retailers it we was Well, – because we Ortega. all We Mayo fill the some took in rates seeing in when hold Ortega demand decline there part dollars could promotions in Cinco participated – with when higher, were where

supporting investments. year bit we’ll as frame, the the mostly innovation Green more and second those well accelerating that putting on launching and take half it e-commerce of the against of later. innovation Giant, awareness we’re year trial some them Ortega So getting the We’ll in well just in and dollars we reapply efforts be as incremental as Mostly, time this were for since planning a particular. as already ready little the

much, guys. very you it. Thank I appreciate

Casella go comes Please of Our next from question Carla JPMorgan. ahead.

Hi.

much on questions. couple how just are – have your locations little on Can a customers prior tell limited operating closed their a Just versus you they’re follow-ups basis? foodservice the us of

customers foodservice large Most of our the are institutional guys.

et and spacing, Okay. like do And Is pay the the increased to the you cost sounds bonuses windfall offset the from sounds than way like those read extra right that it? then more expect cetera, to increases costs. it you it sales the

yes. standpoint, not a maybe standpoint, a dollar little. From necessarily, incremental From margin an EBITDA

Right.

any balances. customers have or where of Okay. And debt non-foodservice the your the or concerns? foodservice bad there – you then expense are Receivable a concern customers

have the of early were their obviously, mean but material. things in April, able we to Nothing businesses. people at watching been to I end pretty seem carefully March, maintain

Okay, were rest questions great. answered. The my of

So thank much you so for time. the

of Jefferies. ahead. comes question Rob from Dickerson next Please Our go

question. Matthew It’s for afternoon. for the Fishbein on Good Thanks Rob.

a one Just to quick follow-up.

of think about maybe employee consider to it, in than little would in incremental but the costs And costs related maybe costs Sorry one-time we of you did they new as about QX, like they you costs equipment. like those are incentives, should amount the bit which be think sound give rest much of dollar situation but if the a these of missed assuming stickier these how screenings non-recurring? quarter? protective How higher Thanks. these would COVID-XX I a of we and the in and were year? they the the QX nature, beyond they’re Some in in

long recede, that to environment the Yes. normalize. Less costs that current so are in. the begins probably in $X start as we as And than million I QX, continue in environment will those to think will cost and we’re

you. Okay, that’s Thank helpful.

Barclays. ahead. Our next Hale question of from comes Please go Holden

restarting you that for repurchases? was excess wondering of sort one’s with cash guys. of more I quick two with the thought had or any becoming given just share I generating, aggressive you’re

I capital structure. at we’re entire the looking think

buying like our come up better quarter, also do looking last out have into shares profile we went any with program repurchase this not in so well. a ended than of levels at it. debt to And place. but We’d we’re share we We as

up had you, XX% the said that repeat. you script is, in of second I one My you was guys think and Got trial brands with Bruce. one it. Thank the

it I range brand high to of was XX% what of was And XX% the was I XX%. at the end range? the think wondering

that. at look to have I’ll – me Let

new seeing new May new come increasing and brands households, in due guys brand XX% consumers the can new use I buyers, among their you consumers category, it’s to that. into. if in XX% you that back between to come are buyers on brands,

one. the up trying to was open – just Green I’m Giant the large

percentage buyers? the new saying You’re of

Yes.

in buyers New the category.

Yes.

New buyers.

You’re brands even like Green Giant, going to McCann’s. see

Yes. Victoria Fruit was Green high was very All Giant, XX%. XX%, Polaner at

you Okay. guys. I it. Thank appreciate

question of ahead. Zaslow Ken next go Please comes BMO. from Our

afternoon, Good everyone.

you be, you just is algorithm. the – idea that know for what little you’re that nature Is it’s and are that? that two your would unusual getting optimism still Can growth seems my my I innovation may going it companies long-term more leave that One two is placements are are how that to with they’re more discuss thinking Just emphatic I’ll second almost the question questions, a And – said early, you you Is given seems as table? your that? eventually products. next and that scheduled. their on have me. that a point Is core seems product of new It but change just my saying, on of kind there. you of – doing. potentially the the actually Those the

to Well, middle, about as still the first. can a try think algorithm, I’ll while the see. with on one start second too It long-term we’re is way you to growth early

our us. is May for going our March. in rate – I – than growth still be in not We’re April it’s growth mean over and in to rate higher

that we’re keeping and way So employees and short-term trying demand a sure customer making our out just safe. filling our figure we’re in the to high-quality

we’ll I We going change. and innovation, that in, think at say emerge that have we didn’t going us in look of usual. not we whether was hope there’s business while as out long-term than something it’s forward. – that terms to a take will for it We be came to figure algorithm or we can any to stronger

changing of new reset. many their delayed them, about to and retailers of of are we all products the the XXXX launch they’re because in just launch that to going to when planning are had yet timing just We them planned

they our retail working are for canceling and delaying, XXXX. on want of we’re reset, to So when not partners many with them based resets

Great. Thank you very much.

concludes This conference and call. the question-and-answer today’s session

You have Thank participating, a and pleasant you for your may disconnect lines. day.