Q2 2025 Conagra Brands Inc Earnings Call (Pre-Recorded) Transcript
Key Points
- Conagra Brands Inc (CAG) achieved a return to growth in Q2 with volume improvement and organic net sales increase.
- 67% of Conagra's portfolio held or gained volume share in the second quarter, marking the fifth consecutive quarter of share gains.
- The company's frozen and snacks domains showed strong performance, with 87% of the portfolio holding or gaining volume share.
- Conagra's disciplined approach to brand building, rather than heavy discounting, has driven volume progress and strong share gains.
- The company expects full-year free cash flow conversion to be greater than 100%, indicating strong cash flow management.
- Profitability is expected to be pressured by higher inflation and unfavorable foreign exchange rates in the second half of the fiscal year.
- The international segment experienced a decline in organic net sales due to volume declines and the impact of a strengthening US dollar.
- Adjusted operating margin declined 60 basis points over the previous year, impacted by unfavorable price mix and cost of goods sold inflation.
- Rising cocoa prices and delayed winter weather contributed to a decline in the Swiss Miss brand's performance.
- The company updated its guidance, expecting adjusted EPS to be in the range of $2.45 to $2.50, reflecting challenges from inflation and FX headwinds.
Good morning. This is Melissa Napier from Conagra Brands' investor relations. Thank you for listening to our prepared remarks for the Conagra Brands second-quarter and first half fiscal 2025 earnings.
At 9:30 Eastern Time this morning, we will hold a separate live question-and-answer session on today's results, which you can access via webcast on our investor relations website. Our press release, presentation materials, and a transcript of these prepared remarks are also available there.
I'm joined this morning by Sean Connolly, our CEO; Dave Marberger, our CFO; and Matthew Neisius, Senior Director, Investor Relations.
We will be making some forward-looking statements today. And while we are making those statements in good faith based on current information, we do not have any guarantee about the results we will achieve. Descriptions of our risk factors are included in our filings with the SEC.
We will also be discussing some non-GAAP financial measures. Please see the earnings release and the slides for GAAP to non-GAAP
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