Conagra Brands, Inc. · NYSE:CAG
Conagra Brands — Q3 2025 Earnings Presentation
39 slides from Conagra Brands's earnings presentation, Apr 3, 2025
Slide 1: FY25 Q3 Earnings Presentation
FY25 Q3 Earnings Presentation April 3, 2025 1
Slide 2: Legal Disclosure
Legal Disclosure Note on Forward-Looking Statements This document contains forward-looking statements within the meaning of the federal securities laws. Examples of forward-looking statements include statements regarding the company’s expected future financial performance or position, results of ope
Slide 3: Sean Connolly
Sean Connolly President and Chief Executive Officer 3
Slide 4: Key Messages
Key Messages • Q3 unfolded consistent with expectations outlined at CAGNY • Consumption trends remained strong • Shipments lagged consumption largely due to discrete supply constraints • Making progress restoring inventory and improving customer service levels • Continuing to monitor the dynamic ext
Slide 5: Conagra's Consumption Trends Remained Strong
Conagra’s Consumption Trends Remained Strong Conagra Domestic Retail Consumption Conagra Domestic Retail Consumption (Volume % Change vs. YA) (Dollar Sales % Change vs. YA) +1.1% +0.8% (0.1)% (0.4)% (1.2)% (1.1)% (2.4)% (1.6)% (1.6)% (1.4)% (4.5)% (3.4)% (6.8)% (4.5)% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q1 Q2 Q3 Q
Slide 6: Shipments Lagged Consumption During the Quarter
Shipments Lagged Consumption During the Quarter Total Conagra Domestic Retail Organic Volume vs. Consumption (% Change vs. YA) 1.0% +1.1% +0.8% (0.4)% (1.2)% (1.8%) (1.0%) (1.7%) (2.1%) (3.5%) (2.4)% (4.5)% (6.8)% (7.0%) Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q3 FY25 Organic Volume Consumpt
Slide 7: Conagra's Share Performance Remained Strong
Conagra’s Share Performance Remained Strong… % of Conagra Portfolio Holding or Gaining Volume Share 66% 66% 67% 60% 57% 40% 37% Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q3 FY25 Source: Circana POS, Total US-MULO+ with Convenience, Syndicated Hierarchy, Total Edible Incl. Bev, Fiscal Quarters.
Slide 8: And Continued to Lead Near-In Peer Set
…And Continued to Lead Near-In Peer Set % of Edible Portfolio Holding or Gaining Volume Share (Total Edible Incl. Bev, 13 Weeks Ended February 23, 2025) 60% 52% 42% 31% 19% 7% Peer A Peer B Peer C Peer D Peer E Source: Circana POS, Total US-MULO+ with Convenience, Syndicated Hierarchy, 13 Weeks Ende
Slide 9: Merchandising Environment Remained Rational
Merchandising Environment Remained Rational Share of Volume Sales on Promotion Average Discount on Promotion FY20 Q3 (Pre-Covid) FY25 Q3 FY20 Q3 (Pre-Covid) FY25 Q3 36.7% 37.5% +2.6pt 30.8% vs YA 28.4% +1.1pt 24.0% 21.9% vs YA 20.6% 19.9% CAG Near-In Peers CAG Near-In Peers Source: Circana POS, Tota
Slide 10: Frozen Growth Continued to Outpace Total Edible
Frozen Growth Continued to Outpace Total Edible Conagra Frozen Retail Volume Sales Q3 Volume Sales (% Change vs. YA) (% Change vs. YA) +3.2% +1.3% +1.3% +1.7% +1.3% (0.4)% +0.6% (3.0)% (5.0)% (7.5)% Edible xBev Frozen Department Q1 Q2 Q3 Q4 Q1 Q2 Q3 FY24 FY24 FY24 FY24 FY25 FY25 FY25 Frozen Source:
Slide 11: Frozen Single-Serve Meals Continued to Drive Strong Share Gains
Frozen Single-Serve Meals Continued to Drive Strong Share Gains Conagra Frozen Single-Serve Meals Conagra Frozen Single-Serve Meals Volume Share of Category Volume Share of Category Enhanced Investments All Other 54.1% Manufacturers 52.8% +1.3 51.2% vs. +0.6 YA vs. 49.4% +1.8 YA 53% $6.4B (0.1) vs.
Slide 12: Conagra's Snacks Portfolio Saw Strong Growth
Conagra’s Snacks Portfolio Saw Strong Growth Conagra Snacks Volume Sales Q3 Volume Sales % Change vs. YA (% Change vs. YA) +3.8% + 14% +1.1% +0.3% + 4% (2.4)%(2.4)% (2.1)% (2.8)% + 4% Q1 Q2 Q3 Q4 Q1 Q2 Q3 FY24 FY24 FY24 FY24 FY25 FY25 FY25 + 3% Source: Circana POS, Total US-MULO+ with Convenience, C
Slide 13: Solid Performance in Conagra's Staples Portfolio
Solid Performance in Conagra’s Staples Portfolio Conagra Staples Volume Sales Q3 Volume Sales % Change vs. YA (% Change vs. YA) + 16% (0.1)% (0.5)% (1.7)% (2.4)% (2.5)% + 6% (4.9)% (7.6)% + 3% Q1 Q2 Q3 Q4 Q1 Q2 Q3 FY24 FY24 FY24 FY24 FY25 FY25 FY25 Source: Circana POS, Total US-MULO+ with Convenienc
Slide 14: Recovery from Discrete Supply Events On Track
Recovery from Discrete Supply Events On Track ADDED SERVICE LEVELS REBUILDING CAPACITY RECOVERING INVENTORY 14
Slide 15: While the External Environment Continues to Be Dynamic
While the External Environment Continues to Be Dynamic… Tariffs & Regulatory & Trade Impacts Policy Changes Inflation & Consumer Confidence Cost Pressures & Spending 15
Slide 16: We Remain Proactive in Managing the Business
…We Remain Proactive in Managing the Business Optimizing our manufacturing footprint Ongoing evaluation of portfolio shaping opportunities Relentless focus on innovation to meet evolving consumer preferences 16
Slide 17: Fiscal 2025 Guidance Unchanged
Fiscal 2025 Guidance Unchanged 1 FY 2025 Guidance 1 Organic Net Sales1 Growth ~(2.0)% (vs. FY24) Adj. Operating Margin1 ~14.4% Adj. EPS1 ~$2.35 1. Forward-looking non-GAAP financial measure. See the appendix for more information. 17
Slide 18: Dave Marberger
Dave Marberger Executive Vice President and Chief Financial Officer 18
Slide 19: FY25 Q3 Results
FY25 Q3 Results Q3 Q3 vs. YA Organic Net Sales1 $2,852 (5.2)% Adj. Gross Margin1 24.8% (389) bps Adj. Operating Margin1 12.7% (369) bps Adj. EPS1 $0.51 (26.1)% 1. Non-GAAP financial measure. See the appendix for certain definitions and reconciliations to the most directly comparable GAAP measure. 19
Slide 20: Net Sales Bridge vs. Year Ago
Net Sales Bridge vs. Year Ago Q3 Drivers of Net Sales Change (% Change vs. YA) Organic Net Sales1: (5.2)% (0.4)% (0.7)% (2.1)% (3.1)% (6.3)% Volume Price/Mix Foreign M&A Total (incl. Retailer Exchange Conagra Investments) Brands 1. Non-GAAP financial measure. See the appendix for certain definitions
Slide 21: Net Sales by Segment
Net Sales by Segment Dollars in Millions Increase/(Decrease) Change vs YA 1 1 Reported Organic1 Price/Mix Volume Net Sales Net Sales Grocery & Snacks $1,245 (3.9)% (2.6)% (1.3)% Refrigerated & Frozen 1,116 (7.2)% (4.2)% (3.0)% International 224 (1.2)% +4.4% (5.6)% Foodservice 256 (6.3)% +3.7% (10.0)
Slide 22: Q3 Adjusted Operating Margin Bridge
Q3 Adjusted Operating Margin1 Bridge Q3 Adjusted Operating Margin1 (% Change vs. YA) 16.4% (1.5)% +0.6% +0.1% 12.7% (2.7)% (0.2)% Q3 FY24 Price/Mix COGS Productivity, Adj. SG&A FX / M&A Q3 FY25 1,3 (incl. Retailer Inflation 2 Net of Operational (incl. A&P) Investments) Offsets 1. Non-GAAP financial
Slide 23: Segment Adjusted Operating Profit & Margin Summary
Segment Adjusted Operating Profit1 & Margin1 Summary Q3 Adjusted Operating Profit1 & Margin1 Dollars in Millions Increase/(Decrease) Adj. Op. Profit1 1 Adj. Op. Margin 1 1 Q3 vs. YA Q3 vs. YA Grocery & Snacks $242 (19.1)% 19.5% (382) bps Refrigerated & Frozen 124 (38.8)% 11.1% (574) bps Internationa
Slide 24: Q3 Adjusted EPS Bridge
Q3 Adjusted EPS1 Bridge Drivers of Q3 Adjusted EPS1 vs. YA $0.69 $0.02 $0.02 $0.51 ($0.02) ($0.20) Q3 FY24 Adj. Pension, Interest & Adj. Adj. Equity FX / M&A Q3 FY25 Adj. Op. Income Tax Exp.1 Method Adj. EPS 1 Profit1 Investment EPS 1 Earnings1 (Ardent Mills, etc) 1. Non-GAAP financial measure. See
Slide 25: Cash Flow Metrics
Cash Flow Metrics (dollars in millions) YTD FY25 YTD FY24 Net Cash Flow from Operating Activities $1,346 $1,531 Capital Expenditures $304 $310 Free Cash Flow1 $1,042 $1,222 Dividends Paid $502 $492 Share Repurchases $64 - M&A – Net Cash Outflow $154 - 1. Non-GAAP financial measure. See the appendix
Slide 26: Strong Free Cash Flow Conversion Driving Continued Debt Reduction
Strong Free Cash Flow1 Conversion Driving Continued Debt Reduction YTD Free Cash Flow1 Net Debt1 ($ B’s) Conversion 124% 125% $8.6 $500MM net debt1 reduction vs. year ago $8.1 YTD FY24 YTD FY25 Q3 FY24 Q3 FY25 3.44x 3.59x Net Leverage Ratio2 1. Non-GAAP financial measure. See the appendix for certai
Slide 27: Fiscal 2025 Guidance Unchanged
Fiscal 2025 Guidance Unchanged 1 Guidance 1 Organic Net Sales1 Growth ~(2.0)% (vs. FY24) Adj. Operating Margin1 ~14.4% Adj. EPS1 ~$2.35 1. Forward-looking non-GAAP financial measure. See the appendix for more information. 27
Slide 28: Q4 & Full Year Commentary
Q4 & Full Year Commentary • Volumes improve vs Q3; shipments benefit from restocking retailer inventory in frozen • Full year inflation of ~4% unchanged; targeted pricing in Q4 on Hebrew National to offset protein inflation • Transitory costs to rebuild supply in frozen • Limited impact to Q4 from s
Slide 29: Appendix
<b VY wbx CONAGRA “BRANDS -° Appendix
Slide 30: Notes on Non-GAAP Financial Measures
Notes on Non-GAAP Financial Measures Note on Non-GAAP Financial Measures This document includes certain non-GAAP financial measures (including organic net sales, adjusted gross margin, adjusted operating margin, adjusted EPS, free cash flow). This appendix provides reconciliations of the non-GAAP fi
Slide 31: Reconciliation of Q3 FY25 Organic Net Sales by Segment
Reconciliation of Q3 FY25 Organic Net Sales by Segment (in millions) - YOY Change 31
Slide 32: Reconciliation of Q3 FY25 Adj. Operating Profit by Segment
Reconciliation of Q3 FY25 Adj. Operating Profit by Segment (in millions) – YOY Change 32
Slide 33: Reconciliation of Q3 FY25 Adj. Gross Margin, SG&A, Net Income and EPS
Reconciliation of Q3 FY25 Adj. Gross Margin, Adj. Gross Profit, Adj. SG&A, Adj. Net Income, (in millions) and Adj. EPS – YOY Change 1. During the third quarter of fiscal 2025, we revised our calculation methodology for Adjusted SG&A to include advertising and promotional (A&P) expense. Includes adve
Slide 34: Reconciliation of Q3 FY25 Adj. Gross Margin, SG&A, Net Income and EPS Cont.
Reconciliation of Q3 FY25 Adj. Gross Margin, Adj. Gross Profit, Adj. SG&A, Adj. Net Income, (in millions) and Adj. EPS – YOY Change Cont. 1. Includes advertising and promotion (A&P) expense of $81.4 million and $85.6 million for Q3 FY25 and Q3F FY24, respectively. A&P as a percentage of net sales wa
Slide 35: Reconciliation of Q3 FY25 Free Cash Flow and Net Debt
Reconciliation of Q3 FY25 Free Cash Flow and Net Debt (in millions) 35
Slide 36: Reconciliation of Q3 FY25 Net Leverage Ratio
Reconciliation of Q3 FY25 Net Leverage Ratio (in millions) 1. As of February 23, 2025. 2. Excludes comparability items related to depreciation. 3. The company defines its net debt leverage ratio as net debt divided by adjusted EBITDA for the trailing twelve-month (TTM) period. 36
Slide 37: Reconciliation of Q3 FY24 Net Leverage Ratio
Reconciliation of Q3 FY24 Net Leverage Ratio (in millions) FY23 Q3 FY23 YTD Q3 FY24 YTD Q3 FY24 TTM (a) (b) (c) =(a)-(b)+(c) 1 Net Debt $ 8,598.8 Net income attributable to Conagra Brands, Inc. $ 683.6 $ 646.1 $ 914.5 $ 952.0 Add Back: Income tax expense 218.7 237.0 297.1 278.8 Income tax expense at
Slide 38: Reconciliation of Q3 FY24 and Q3 FY25 YTD Free Cash Flow & Conversion Rate
Reconciliation of Q3 FY24 and Q3 FY25 YTD Free Cash Flow (in millions) & Conversion Rate Q3 FY24 YTD Q3 FY25 YTD Net income attributable to Conagra Brands, Inc. $ 914.5 $ 918.9 Restructuring plans 22.0 68.7 Acquisitions and divestitures 0.2 0.2 Corporate hedging derivative losses (gains) (7.1) (13.0
Slide 39: Reconciliation of Q3 FY25 Adj. Equity Method Investment Earnings
Reconciliation of Q3 FY25 Adj. Equity Method Investment Earnings 39