Q2 2026 Lamb Weston Holdings Inc Earnings Call Transcript
Key Points
- Lamb Weston Holdings Inc (LW) reported an 8% volume growth in the second quarter, driven by customer wins, share gains, and strong retention, particularly in North America and Asia.
- The company is reopening previously curtailed capacity in North America to meet customer demand and maintain high fill rates, indicating strong market demand.
- Lamb Weston Holdings Inc (LW) is effectively managing its capital, delivering strong free cash flow, and reducing capital spending, which is expected to come in below the $500 million target for fiscal 2026.
- The company announced a 3% increase in its quarterly dividend, continuing its commitment to returning cash to shareholders.
- Lamb Weston Holdings Inc (LW) is benefiting from its global footprint, capturing volume in fast-growing markets such as Asia and Latin America, and leveraging its supply chain to diversify supply and risk.
- The international environment remains competitive, with pricing pressure in Europe due to a strong potato crop, softer restaurant traffic, and lower export demand.
- Price/mix declined 8% at constant currency, primarily due to the carryover and current year impact of price and trade to support customers, as well as mix shifts towards lower margin sales.
- Adjusted EBITDA declined by $9 million compared to last year, primarily due to unfavorable price mix and higher manufacturing costs internationally.
- The company faces headwinds from input cost inflation outside of potatoes, driven by tariffs, labor, fuel, power, water, and transportation rates.
- Lamb Weston Holdings Inc (LW) is experiencing higher manufacturing costs in its International segment, including start-up expenses in Argentina and increased costs in Europe as it works to rebalance supply and demand.
Please stand by. Good day and welcome to the Lamb Weston second-quarter 2026 earnings call. Today's conference is being recorded.
At this time, I like to turn the conference over to Debbie Hancock, Vice President of Investor relations. Please go ahead.
Good morning and thank you for joining us for Lamb Weston's second-quarter fiscal '26 earnings call. I'm Debbie Hancock, Lamb Weston's Vice President of Investor Relations.
Earlier today, we issued our press release and posted slides that we will use for our discussion today. You can find both on our website lambweston.com.
Please note that during our remarks we will make forward-looking statements about the company's expected performance that are based on our current expectations. Actual results May differ materially due to risks and uncertainties. Please refer to the cautionary statements and risk factors contained in our SEC filings for more details on our forward-looking statements.
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