Hello, thank you for standing by. Welcome to BellRing Brands' third quarter fiscal year 2024 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask the question during this session, you will need to press star one one on your telephone. You will then hear an automated message and your question is raised. To withdraw your question, please press star one one again. I would now like to turn the call over to Jennifer Meyer of Investor Relations for BellRing Brands. You may begin. Good morning and thank you for joining us today for BellRing Brands' third quarter fiscal 2024 earnings call. With me today are Darcy Davenport, our President and CEO, and Paul Rode, our CFO. Darcy and Paul will begin with prepared remarks, and afterwards, we'll have a brief question-and-answer session. The press release and supplemental slide presentation that support these remarks are posted on our website in both the investor relations and the SEC filing sections at bellring.com. In addition, the release and slides are available on the SEC's website. Before we continue, I would like to remind you that this call will contain forward-looking statements, which are subject to risks and uncertainties that should be carefully considered by investors, as actual results could differ materially from these statements. These forward-looking statements are current as of the date of this call, and management undertakes no obligation to update these statements. As a reminder, this call is being recorded, and an audio replay will be available on our website. Finally, this call will discuss our non-GAAP measures. For a reconciliation of these non-GAAP measures to the nearest GAAP measure, see our press release issued yesterday and posted on our website. With that, I will turn the call over to Darcy. Thanks, Jennifer, and thank you all for joining us this morning. I have four key messages today that I want you all to walk away with. The first, I'm happy to share that we had a strong quarter. The business continues to perform as we bring on new shake capacity and begin to drive demand. Net sales grew 16% over prior year and adjusted EBITDA up 38%. We saw strength in Premier Protein, with net sales at 20%. Our EBITDA margins were above our expectations as we benefited from favorable gross margins. I'm proud of our year-to-date performance, with each quarter delivering above our long-term algorithm. My second message: Premier shake demand remains strong. The RTD shake category continues to grow, with Premier Protein bringing in new consumers. Our consumption grew 10% in Q3 and accelerated to 20% in July. Premier Protein hit an all-time high in household penetration and remains the highest in the RTD category, outpacing its nearest competitor by six percentage points. We have the number one velocity SKU across the entire RTD category, and 80% of our products rank in the top third. We continue to believe that the brand has a ton of untapped potential, given we haven't started meaningful marketing or innovation. My third message, our production delivered to plan and our outlook has improved. Our diversified co-man network has consistently delivered to expectations every quarter this year, and I'm happy to share that we have secured incremental capacity in Q4. This additional production enables us to fill remaining customer inventory gaps and allows us to rebuild our internal inventories to our target safety stock levels, setting us up for a strong fiscal 2025. I would be remiss if I didn't give a huge shout-out, or as we say, "Ring the bell," for our entire organization, but especially the sales and operations teams. It is challenging to manage a rapidly growing business in a dynamic category, but it is incredibly hard to do it with limited safety stock when there is little room for error. So, thank you for... Thank you all for your hard work. What we've learned will benefit us, will benefit us for years to come. My last message really is a culmination of the first three. Our better-than-expected Q3 performance, confidence in demand, and increased Q4 production drove our decision to raise our outlook for the year. We now expect net sales to grow 18%-20% over fiscal 2023 and adjusted EBITDA to grow 27%-30%. We are proud of our performance to date and encouraged by our momentum going into 2025. While certainly not finished with our planning process, our initial estimates for next year are to deliver at the high side of our long-term net sales growth algorithm of 10%-12%. We will provide more details on fiscal 2025 outlook in November. Now to get a bit deeper into the category and brand highlights. The convenient nutrition category grew 7% in Q3, and all forms saw stronger growth versus Q2. Ready to drink led the category up 11%, driven by strong velocities and distribution gains. Mainstream RTD brands continue to drive most of the growth and are bringing in new consumers into the category. Ready to mix grew 8%, boosted by feature and display activity. Protein continues to have incredible tailwinds and high relevance with a broad swath of consumers. It is beneficial for almost every age, depending on their nutrition and health goals. It is rare to have a nutrient that is equally as critical for a child, a teenager, a pregnant woman, an athlete, and an aging adult, while providing a wide variety of benefits, ranging from muscle building to weight management. The more we learn, the more our teams get excited about our future, our future potential, given our brand's mainstream appeal. Turning to our brands. Premier shake consumption growth remained strong this quarter, up 10%, with volumes up 14%.... Growth was robust in mass, food, and e-commerce, driven by strong velocities and distribution expansion in mass and food. Club was the outlier, with flat dollar consumption growth versus year ago because of temporary changes in our assortment and flavor-specific out-of-stocks. Encouragingly, club consumption returned to growth in July, and overall consumption grew 20%. Our brand metrics remained healthy. Premier Protein, with RTD market share of 21%, maintained its position as the number one brand in the RTD segment, as well as the number one brand in the broader convenient nutrition category. Both market share and TDPs grew throughout the quarter, with TDPs up 13% versus Q2. Expansion in form, including bottles and pack size, along with improved in-stocks, drove the distribution gains, and we expect further TDP growth in Q4. As I referenced at the beginning, I'm pleased to see the brand reach another all-time high in household penetration, with 19% of households drinking Premier Protein. We surpassed our goal for the year, adding roughly 3 percentage points of household penetration in fiscal 2024, with repeat and buy rates holding, continuing to hold steady. Premier Protein continues to bring in new category consumers, with almost all of our growth coming from outside the category. All of this is especially encouraging, because in a high-growth category with low household penetration, we see plenty of room to continue to grow our brand and expand the category. Premier Protein powder continued its strong trajectory, growing 44% in Q3 behind distribution gains and strong velocities. In fact, at a major mass customer, we have the number one velocity item in the retailer's powder category. We remain encouraged by the growth potential of the Premier Protein brand in this format and are investing more marketing dollars behind it in Q4. Its household penetration reached 1.8% this quarter, and we continue to believe the brand will be a contributor in mainstreaming the powder category in the same way Premier did for the ready-to-drink category. Turning to Dymatize. The brand remains one of the strongest in the category, with velocities in the top third at key customers. However, U.S. consumption, which covers about 60% of the global brand, was challenged this quarter as a result of tough comparables, continued competitive pressures, and ongoing softness in the specialty channel. Despite these headwinds, July had a record e-commerce promotion, showing there's still a ton of excitement for the brand. It is also worth noting that Dymatize international business, which represents about 30% of the brand, continues to be strong, with net sales up 18% this quarter. Looking forward, we are increasing investment in behind Dymatize in the U.S., both in marketing and promotion. Our national marketing campaign with San Francisco All-Pro running back Christian McCaffrey launches this month. We are excited to see what this type of top-tier spokesperson and amazing creative can do for the brand. Overall, we continue to be bullish on the mainstream powder potential with two complementary brands. In closing, I am proud of our year-to-date progress. We are on track to deliver results ahead of our guide last November. Our confidence in the long-term outlook for BellRing Brands remains high. Ready to drink and powder segments are in the early stages of growth with major tailwinds. Premier Protein and Dymatize are leading mainstream brands with low household penetration and strong loyalty, with Premier Protein maintaining the number one share position in the category. Our momentum continues to grow on shakes as we start to drive demand. Our capacity plan is on track to support many years of robust growth. I'm excited to see our organization pivot from supply-focused to demand-driving. At our core, we are a growth company, so our entire organization is eager to have all of our demand drivers in place for 2025, including our national marketing campaign on our biggest brand. Thank you for your interest in the company. We look forward to providing more specifics around fiscal 2025 next quarter. I will now turn the call over to Paul. Thanks, Darcy, and good morning, everyone. Net sales for the quarter were $515 million, up 16% over prior year, modestly above our expectations. Adjusted EBITDA was $120 million, an increase of 38%. Adjusted EBITDA margins were 23.2%, meaningfully exceeding our expectations and lifted primarily by favorable gross margins. Starting with brand performance, Premier Protein net sales grew 20% behind strong volume growth for RTD shakes and powders. RTD shake growth of 19% was driven by organic growth, distribution gains, and to a lesser extent, higher trade inventory levels. Shipment growth outpaced consumption dollar growth as a result of late Q3 trade inventory builds and lower net retail pricing. Entering the fourth quarter, trade inventory levels are improved and nearly to target levels, with the remaining gaps to be filled in Q4. Dymatize net sales decreased 3% this quarter on 4% higher volumes, with double-digit growth for international more than offset by declines domestically. For domestic, recall, we are lapping a challenging comparable period that included heavy display activity and changes in club distribution. Promotional activity and unfavorable mix were also a headwind to growth this quarter. Gross profit of $190 million grew 40%, with an increase in margin of 630 basis points to 36.8%. The margin increase resulted primarily from net input cost deflation as we lapped elevated protein cost in the prior year. Gross profit in the quarter also included an unrealized mark-to-market gain on our commodity hedges, which drove 80 basis points of the year-over-year increase. Compared to our expectations, gross margins benefited from more favorable whey protein cost than expected and to a lesser extent, nonrecurring cost favorability. SG&A expenses as a percentage of net sales were 14.4%, relatively in line with the second quarter, with advertising and promotion spend 2.9% of net sales. Before reviewing our outlook, I would like to make a few comments on cash flow and liquidity. We generated $69 million in cash flow from operations in the third quarter and $160 million year-to-date. As expected, shake inventory levels increased in the third quarter, with further increases expected in the fourth quarter, driven by incremental production. As of June 30, net debt was $776 million, and net leverage was 1.8 times. With our EBITDA growth and strong cash flow generation, we anticipate net leverage will remain below 2x in fiscal 2024. With respect to our share repurchases this quarter, we bought 1.3 million shares at an average price of $58.08 per share, or $74 million in total. Our remaining share repurchase authorization is $216 million. Turning to our outlook, we raised our fiscal 2024 guidance for net sales to be $1.96 billion-$2 billion and adjusted EBITDA of $430 million-$440 million. Our guidance implies strong top line growth of 18%-20% and adjusted EBITDA growth of 27%-30%, with healthy adjusted EBITDA margins of 22.0% at the midpoint. The updated guidance reflects our better-than-expected Q3 results, confidence in demand and increased shake production in the fourth quarter. Our updated guidance implies fourth quarter net sales growth of 14% at the midpoint, with Premier Protein, the main driver. Dymatize and all others expected to be relatively flat year-over-year. Premier Protein growth is largely volume-based on distribution gains, higher LTO volumes, and continued robust organic growth, partially offset by reduced club promotional activity. We expect shipment dollar growth for Premier RTD shakes to modestly outpace consumption growth as we fill the remaining retailer inventory gaps and load new distribution. Fourth quarter gross margins are expected to improve meaningfully over the year-ago quarter, benefiting from lower net input costs, while higher marketing outweighs the gross profit margin improvement. Lastly, we expect 4th quarter Adjusted EBITDA margins to be down slightly compared to prior year. In closing, we are pleased with our year-to-date performance. Our momentum is high, and we are well-positioned to close out the year. I will now turn it over to the operator for questions. Thank you. Ladies and gentlemen, as a reminder to ask the question, please press *1 1 on your telephone and then wait to hear your name announced. To withdraw your question, please press *1 1 again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Andrew Lazar with Barclays. Your line is open. Great. Good morning, everybody. Good morning. Darcy and Paul, I think last quarter you mentioned, you were planning for a price increase, to start hitting in the fourth quarter on Premier Ready to Drink shakes. Is that still the, the plan, given that you had much more favorability in, in input costs this quarter than you thought? Yes. We are still moving forward with the price increase. Keep in mind that a lot of the favorability in this particular quarter was related to whey protein powders, which is the input cost for our powder business, not our shakes. So a lot of the favorability was on whey protein, and that is, as you may recall from last quarter, we talked about there was a very sharp rise expected in the third quarter on whey protein cost. For us, we were just a bit conservative on how quickly that flowed into our, our P&L. And so we saw some favorability because of, primarily because of whey protein, so it's not as much related to shakes. Shakes were pretty much, largely on track on cost. Great, thanks for that. And then, Darcy, you mentioned securing some incremental capacity that'll help you in the fourth quarter to get back to your, all the way to your target, sort of, you know, inventory or safety stock levels. Was that incremental capacity that was already in the pipeline that's just now sort of coming online? Or was it incremental to sort of what you had planned for this year? And then as part of that, have you formally committed to increasing the number of lines beyond the initial 4 at each of your, you know, 2 greenfield facilities yet? I know you've been considering it for some time, but I'm just wondering how that looks as you think through potential supply needs for 2026 and 2027. Thanks a lot. Yes, the incremental capacity was incremental to what we originally thought at the beginning of the year. So, very good news. We have been pushing our existing co-mans for more capacity for the last couple of years, and this is really the first time that we've been able to secure some. So I think it's good news. I think it's, it's good news that our co-mans, you know, have fully stabilized and are now actually having some efficiencies that they're able to pass on. So all around, very good news. As for the expansion of our, you know, co-mans with new lines, we're in the process of evaluating who we're going to expand with. But generally, the timeline is the same. We expect to need new capacity in 2026. Thanks so much. Thank you. Thank you. Please stand by for our next question. Our next question comes from the line of Ken Goldman with J.P. Morgan. Your line is open. Hi, thanks so much. I appreciate the early look into the top line next year, with the understanding that, you know, the year hasn't even started yet. I was just curious, are there any early reads on, just as we think about the flow-through of the top line to the bottom line, any particular tailwinds or headwinds we should think about in terms of... costs that, you know, might lead EBITDA growth to, to veer, you know, more than usual, either positively or negatively from where sales growth is? Yeah. Good morning, Ken. So, a couple of things I would say for thoughts for fiscal 25. First, you know, we've obviously highlighted that we expect that fiscal 25 for our shake business will be, you know, will be driving demand, which would suggest, obviously, incremental marketing spend, potentially promotional spend. So, as we look from 24 to 25, I would say, I would expect to see some step up on the marketing line and then promotion, perhaps. And obviously, we may toggle between those two as we make decisions on driving demand versus on promotion versus marketing. The other one is we are expecting inflation to continue into 25 or to increase in 25 versus 24. It's more impactful on our powder business. We, you know, we're expecting a pretty sizable step up, starting really in Q4 and then into the first half of next year. But on powder, on our shake business, we still expect some inflation throughout the year, but obviously, we've taken a price increase there. So, I think, you know, we can largely offset with our price increase on shakes. But going forward, I expect some headwinds on inflation, perhaps some headwinds on marketing and promotion. Thank you. And then for a follow-up, we started to see your biggest shakes competitor, or at least what we would see as your biggest one, gaining shelf space in the mainstream beverage aisle in a couple of sorts of traditional supermarkets. I'm just curious, is this something that's getting more widespread? Is it more anecdotal? And I'm just curious if it sort of accelerates your desire to migrate the Premier shake brand a little bit more into the more mainstream part of stores as well, or if it's not really a consideration at this point. Thank you. So, yes, we've absolutely been tracking it, and it's true. There's been some expansion, and it's really through DSD. Not surprising that that competitor has expanded into the beverage aisle. As you remember, you know, getting out of the aisle... So, kind of, I think I would separate our strategies into two pieces. One is more the near term of getting out of the aisle, right? So, getting out of the aisle has always been a key part of our strategy, that can show up in a couple different ways. One is end aisle display, the other is displays in other part of the store. And we have been actively pursuing that, both of those strategies, especially with that is a key part of our singles strategy. You actually go out to, we saw a lot of this quarter, and we'll see it next quarter, a fair amount of bottle displays, and you'll see it everywhere from, you know, right adjacent to the pharmacy section where we are, to, you know, at checkout. You'll see them in coolers, and you'll even see them in other areas of the store, like near the deli. So, absolutely a key part of our strategy. Then if you look more long term, which is I think what you're more asking, which is around, you know, the at-the, the movement of us into a more mainstream aisle, and that... And I would say that we are still actively evaluating. We actually think that we can get a lot of the bumps of eyeballs of awareness, and therefore trial by the first two strategies, which is just end aisle display and multiple placements, you know, around the store versus the actual, you know, picking up the category and moving. But we're absolutely evaluating. Got it. Thank you so much. Thanks. Please stand by for our next question. Our next question comes from the line of Thomas Palmer with Citi. Your line is open. Good morning, and thanks for the question. You noted in the prepared remarks how innovation for Premier Protein has maybe not been as big of a focus, in part due to some constraints. Is there a point as we look out towards next year that this starts to ramp up and become a bigger focus? And then just any examples to highlight on this front? Yeah, so I would put innovation into two buckets. The first bucket is what I call little I innovation, which is, basically pack size, format, expansion. So that can be a combination of, you know, you know, like we have bottles, it can be bigger packs, smaller packs, it can be different sizes, which we'll get at different macro levels of protein. So that, in my mind, is kind of little I innovation. But flavor also is put into that, into that segment. We see just a ton of opportunity in with little I innovation. When you talk about big I innovation, and that is really going for incremental consumers and incremental occasions. Yes, so that we've kind of put on the back burner because of capacity. But you'll see us, increasing focus and increasing launches of new lines in 2025. Obviously, I'm not gonna get into what that innovation is on a public call, but you'll, you'll see a couple of new lines come out on Premier Protein next year. Thank you. And then on Dymatize, what's the messaging, I guess, in this new marketing campaign, and what's the target? Is it more customer awareness for the brand? Is it trying to differentiate the brand in what seems to be maybe a little bit more of a competitive segment right now? Just any help on that as we move into the back half, and this campaign launches. Yeah, so the focus is, and you'll, it actually hits the air this week, so you should hopefully see it. The focus is really around awareness. I mean, you know, our, our household pen is 1%. So, it's around awareness of the brand. The Dymatize is a, is a premium product, and so, which, consumers are expected to pay more for. And so, we wanna explain why it's worth it, and why people should really kind of graduate to Dymatize. And we're doing it with, you know, borrowed equity of Christian McCaffrey. What's amazing about him is, it is a super authentic connection because he already uses Dymatize in his kind of nutrition and workout regimen, and it is a key part of his success. So it is, you know, not by coincidence that we're launching the campaign right as football season is starting. And so that is... And, and obviously, he is a big name. So, that is- that's the focus. It is an awareness campaign, and it's focused around the Dymatize equity. In addition to that equity campaign, we also have a couple other spots that will focus on flavor. So, if you think of kind of upper funnel, lower funnel of a marketing campaign, upper funnel is, we have both going on within the campaign starting in Q4, and then it will continue into 2025. Thanks for all the detail. Yeah. Thank you. Please stand by for our next question. Our next question comes from Brian Holland with D.A. Davidson. Your line is open. Yeah, thanks. Good morning. Maybe just referring back to Paul's earlier response and question about pricing, you know, mindful of when commodities are flowing through the P&L, and also more broadly, just kind of the volume, the challenging volume backdrop across CPG. Just any sense you can provide or, you know, share with respect to customer response to the pricing that you announced last quarter? Paul, you want me to answer that? Yeah, please. Yeah. So, I mean, pricing is never easy. What I will say is, it is helpful that other competitors have taken pricing recently. And again, it is because of the rising cost of specifically, you know, manufacturing, labor, freight, et cetera. So, we're seeing some increases, and other people are passing it on, too, and they did it before us, which always helps. You know, no major pushback, I would say, and it's all of them are over the line. Perfect. Thanks. Then, I wanted to ask about, you know, we're getting asked about, you know, private label, competitive dynamics with some rollouts, particularly in, whey powder. So, you know, Darcy, I was hoping maybe you could just provide a little bit of perspective on what private label looks like in this, in the categories you compete in more broadly, and maybe any historical perspective, to help sort of frame, you know, what, what private label has done in this category and maybe the limits to its ability to take share, if that makes sense? Yeah. Yeah, so private label in. It's definitely less, I guess, mature in this category than in others. It represents in RTD, it's about 9%, powders is about 4.5. Just realize that more, and that's in tracked channels. So, just remember that most of the powder category, there's just less in tracked channels, for powder. So, I mean, our estimates are actually, for powders, it's probably closer to where RTDs is, so call it 9%-10%, if you kind of look at the whole marketplace. And same thing for bars. So, generally, what is interesting is, you know, for the most part, it's maintaining share. So, it's not growing faster, in our category than, the branded players, so it's just maintaining share. That has been the case for the last few years. You know, this just happens to be. Now, there are, as you know, there are stronger private labels and less strong private labels. So, I think the success depends on the retailer. However, I would generally say that in this category, people look for trusted brands, and they. And that has been the case. I think where we saw it first go was. I think it has to do bars, I would say had a bigger, I would say went private label first, then powder, and I think RTDs will be last. And part of that has to do with the just dynamic in the category, meaning that there just isn't a lot of capacity in RTDs. It's very complicated to produce the private label within RTDs, at least, are concentrated in a couple of retailers. And others have tried and have not been successful, and so I think are a little scared of it. So does that give you some reference and context? Yeah, no, that's extremely helpful, Darcy. I can leave it there. Thank you. Great. Please stand by for our next question. Our next question comes from the line of Bryan Spillane with Bank of America. Your line is open. Hey, guys. Good morning, and thanks for the question. So, I just had a quick one on Premier. So, you said you had strong consumption growth in all key channels, with club being the exception. Are you able to quantify the impact of the temporary changes in assortment? And also, you mentioned that club consumption began to accelerate in June and into July. So, is there any way to quantify that? And do you expect that acceleration to hold in 4Q or even accelerate further from there? Okay, sorry. There were a lot of questions in there, Bryan. Can you just- I'm sorry. Sorry. Yeah, yeah, yeah. Can you just say the question one more time? Yep. So just the first question of all of that is just, are you able to quantify the impact of the temporary changes in assortment in 4Q, just as it relates to club kind of being weaker than the rest of the channels in Premier? You said Q4? Yeah. Paul, do you want to give that? Well, I just want to clarify. Are you, are you saying the temporary changes in Q3, or you said Q4? Yep. Just wanna make sure. Okay. Yeah, so we did, we did have some changes in club assortment in the third quarter, primarily with one of our largest club customers, which did start to ship in late in the quarter and early into the fourth quarter. So, we should see, you know, the year-over-year headwind of that change in Q4 as we move forward. I don't know if I have a precise number of what we think that impact was, but certainly it had an impact to the club growth in the quarter, as well as just some of the out-of-stocks in some of our other club customers, which vastly improved as we got later into Q4-Q3, and you're seeing that in the growth as we hit late Q3 into Q4. Yeah, and Bryan- Okay. If you're thinking about headwinds to consumption, I think that, I mean, our Q3 consumption was lower than what we expected, and we would say that we would have expected about 4 percentage points higher than what we saw. So, the combination of the. And basically, that was due to some delayed shipments that went out. And so, part of about 3 points of that was replenishment for out of stock, and about 1 point of that was due to new products being shipped in. So hopefully that helps with around 4 points of consumption. Okay, great. That's, that's really helpful. And just a quick follow-up, and it's a, a more higher-level question. I just had a quick one on your target consumer base as it relates to growing household penetration. I know you said previously that this is a more adult brand, but I saw recently that there was an activation in New York, and these pop-ups tend to skew towards younger audiences. So, could you just talk a little bit about, you know, the consumers that you plan to address from here and how you expect that to drive, you know, continued household penetration growth? Yeah. So you saw the ice cream pop-up? Yep. I saw that. That was very successful. So, yeah. So, low household penetration category, low household penetration brand. So, currently, you know, our average age is right, you know, call it early forties, but ranges. And so we, our marketing campaign will really focus on that we're, we're trying to get to kind of the younger population, where we can bring them into the category early and then keep them throughout. So as you can tell, that was one kind of test activation. But you'll start seeing it. As we build out our marketing campaign for next year for Premier, you're gonna see that come through in the creative of who we show, as well as if, you know, you can see it through just the targeting efforts. Okay, great. Thanks so much, guys. Mm-hmm. Please stand by for our next question. Our next question comes from the line of Robert Moskow with TD Cowen. Your line is open. Hi, thanks for the question. Just to clarify, I think you said consumption was about 400 basis points lower than what you thought for various factors. Was that for all channels, or was that just for club? I didn't catch it. All channels, but it was majority, the most of the effect was club as well as some food. Okay. And the reason I ask is, if you just look, you know, eyeballing slide 8, if you look at the consumption trends for Premier Protein RTD, you know, it's your biggest segment. The comps get really difficult in October and fourth quarter in general, you know, growth up 36%. And, you know, do you need some kind of major acceleration, and are you expecting a major acceleration in kind of this tracked consumption pattern in 4Q? And do you think that would be? How would that relate to shipments? Because I know you're still filling inventory gaps. You know, do you think shipments could be even higher than that? Yeah, I can take the latter. Yeah, you can do that. Yep. Yeah. So, as I mentioned in my prepared remarks that we do expect shipments to modestly outpace consumption growth. So, shipment growth slightly outpaced consumption growth in the fourth quarter, and that's because we're continuing to replenish the remaining out of stocks and getting our retailers' inventories full but also shipping new distributions. Darcy touched on some of this before, so you know, we've got some bottles going in, and some other distributions. So yes, we expect a modest increase or shipments ahead of consumption in the fourth quarter. As far as the chart you're referencing, I think you're looking at the October timeframe. So last year, we did in August, have a club event. We called it a small club event in August. And so that's what you're seeing kind of in the 13-week rolling as it gets to October. It's mainly the impact of that August promotion. We are lapping that this year. We're doing less days on promotion, so it is a bit of a headwind for us in the fourth quarter, but that is all contemplated in our guidance and in our thinking around shipments versus consumption. Okay, so if we- Yeah, and Rod, just to- Go ahead, Darcy. Sorry, go ahead. Sorry. Well, I know that there... We both are focused. Go ahead. Darcy, you go first. You're CEO, so please go ahead. Well, I know that everybody's focused a lot on consumption, which I understand why. So I thought it might help a little bit to give you some of the monthly dynamics that we expect in Q4. Mm-hmm. You know, obviously July was really strong at 20%, and then... But, but that will-- we, we expect overall Q4 consumption to be kind of like low teens, so we'll see. And that was some of the dynamics that Paul was just talking about. In August, you should expect, especially late August, you should expect a consumption dip, and it's mainly because we're lapping that club promotion, that is in untracked channels, but is captured in MULO+, and then you'll see an acceleration into September. So, you, you see strong July, come down a bit in August because of the lapping of this club promotion, and then increase again in September. That's very helpful. Thank you very much. Yeah. Thank you. Please stand by for our next question. Our next question comes from the line of David Palmer with Evercore ISI. Your line is open. Thanks, and thanks also for that last point. Just to follow up on that, if we were to broaden out and just think about volatility as we're seeing in the data, you know, or maybe we can do a retrospective and look at how the sales have been volatile in the past. How much of that volatility do you think is related to not only an ebb and flow of your capacity constraints, but also a key competitor's capacity constraints, maybe being different than yours? Maybe they had it at different points in the past, making for easy comparisons competitively, and then you perhaps had some constraints in addition to the assortment reset that you talked about in this last quarter. Just any comments on that, and even how that governs the comparisons that we'll be seeing in the coming quarters? Yeah. So, I'll start with, yeah, ours. I hate the word, the use of the word volatility, but that, the changes within our consumption patterns are absolutely a reflection or exacerbated by our lack of safety stock and lack of trade inventory. So, I'm gonna give you. So, I mentioned that consumption was below what we expected in Q3. The reason was timing, and what happened was we had some shipments that were planning to go out in May. They didn't go out. They were delayed until June, and the associated consumption got pushed to July. Well, this happens all the time. We have changes of, you know, releases based on what we expect, but you don't see it, or consumption doesn't reflect it, because the retailer has enough trade inventory. We have enough safety stock to basically, you know, blunt those kinds of changes. And because we do not, some of these show up in the consumption. So, when we get back to, which we're close, when we get back to, you know, adequate safety stock as well as adequate trade inventory, we just will not see these types of, kind of, I guess, volatility as you put it. The second piece is, this is completely having to do with our safety stock and our trade inventory and the retailer's trade inventory, less about competition. Interestingly enough, I mean, I talked about the category, that is, really the growth is driven by the mainstream brands. Well, the mainstream brands, us, as well as our biggest competitor, all of our growth, almost all of our growth is coming from outside of the category. There really is not very much brand shifting between the, you know, two brands. Thank you for that. And just by judging on your EBITDA margins for this year, it looks like you'll finish above the 18%-20% long-term guidance. You know, how are you thinking about your long-term margin now? Is that something that could be in the low 20s longer term? Yeah, we obviously, yeah, as you mentioned, we're having a strong margin year, keeping in mind that, you know, it's still not a full demand driving year on, especially on our biggest business, Premier Protein. So I wouldn't think... I don't think that 22% is our new normal. But yeah, it's something we're certainly evaluating it. You know, we like our long-term algorithm, it gives us flexibility on spend, but we've always said that our target was to be on the upper part of that, and we've been consistently on the upper part of that, but we'll continue to reevaluate it. And obviously, when we come to November, we'll give our thoughts on how it plays out in fiscal 2025. Okay, thank you. Thank you. Please stand by for our next question. Our next question comes from the line of Jim Salera with Stephens. Your line is open. Hi, guys. Thanks for taking our question. Darcy, I wanted to drill down a little bit in club. In my area, in the Midwest, I've seen a pretty significant increase in promotion from albeit smaller competitors, but other competitors that have RTD shake offerings. I guess the first question is, is that something that you see more broadly, or maybe that's more concentrated in my area? And two, as you think about maybe the promotional cadence moving forward and maybe the ability for the category to take price, should we think about kind of alternating promotions between brands as putting a ceiling on pricing power for the category? Let me answer your first question, and then I might need a little bit of clarity on the second one. So, in club, yes, promotional intensity has increased a little bit, and it's really, it's actually not the top two brands, but all the rest of them, as you said. I will say, and that, that is not a new trend. That is really over kind of the last, call it, year-ish. And there, there seems to always be somebody, a brand on promotion and MVM. So, so that is, I would say, more of a kind of a long-term trend. The second... And, and, oh, and as it refl-- is that indicative of the rest of the marketplace? Definitely in powder, there, and I talked about it on the last call, and this trend continued, where there has been an increase in discounting and promotional intensity on powders for sure, across the marketplace. RTD, it hasn't been extreme, it hasn't been as extreme, but there's definitely been an uptick in promotion on RTDs. And I think it's; it really has to do with capacity coming on. I think that, you know, we have a little bit more capacity, and so people are able to get back to driving demand. And sorry, sorry, what was the second question? Yeah, the second part was really just if there's kind of this always on promotional calendar for the space, does that limit pricing power, just given the value gaps, if there's always somebody in the category that has a promo on, even as your promos kind of roll on and off, does that limit how much price you can take because you need to keep kind of a relative gap to whoever's on promo at that time? No. I mean, I think that we'll just talk for our brand. I feel very good about our pricing power, and we're, you know, we have an incredibly strong brand with high loyalty, and I think we've shown that consistently over the course of, you know, you know, kind of the last few years, given the performance of the business, despite capacity constraints, really, consumers have stayed with us. So, I think that for us, we are not going to go. We do not need to go deep on promotion. I have said this before, the key for promotion for us is getting display. So we will do as little TPR as we need to, to get the display, because the display is where we get the eyeballs, the eyeballs are where we get the trial, the trial is where we get the repeat, and there, it goes from there. So, that will be our focus. And we see, you know, we have two major drive periods. Everybody enters into the category really in our Q2, January, February, March, so that's a big drive period. And we started, we got back to promotion this year during Q2. We will expect to do it again next year. And then we will also have kind of a second drive period in the Q4 period, and it will be a little bit lighter, because again, I think we've learned that we don't have to go deep or really as frequent. I appreciate the call. I'll hop back in the queue. Thank you. Please stand by for our next question. Our next question comes from the line of Jon Andersen with William Blair. Your line is open. Hi, thanks for the question. I was wondering if you could talk a little bit about fall shelf resets and how your expectations are there, perhaps relative to last year? And is that kind of factored into your expectations for shipments to run ahead of consumption in the 4th quarter? And then the second follow-up question is just on capacity. You've had your base plan for capacity and now secured some incremental capacity on top of that. I'm just wondering where that maybe puts you in terms of supporting sales growth in 2025. Thanks. TDPs for Q4, we do expect some increases. It will be a combination of actually, if you look at the supplemental presentation, page 10 is a great graph to show the increases. We did get fairly big increase last year, and that was around a mass retailer that we expanded shelf space a fair amount. We will see some increase in Q4, not as dramatic as we did last year, but we got some nice space in that retailer. And then we'll also see a little more favorability from just filling the gaps of trade inventory that we didn't fill in Q3. So, part of the increases will be out of, you know, filling the trade inventory for the ones that are left, and then partially, it's going to be shipping in for new distribution. So yes, we do expect, and Paul said this in his prepared remarks, we do expect to have shipments a little bit ahead of consumption in Q4. The second piece is capacity. Yes, the incremental production that we secured this quarter really sets us up nicely. It allows us to not only, you know, deliver our guidance and actually raise it, but also fill our get to our target weeks of safety stock, which is eight weeks, that going into 2025. So, we're in a great place to really hit the ground running and get back to demand driving. Thanks so much. Thank you. Please stand by for our next question. Our next question comes from the line of Bill Chappell with Truist Securities. Your line is open. Thanks. Good morning. Morning. Okay, just two questions. One, maybe I didn't fully understand when you talked about the consumption 400 basis points below your expectations, and a lot of that coming from the club channel. I'm just trying to understand why it was below your expectations. You just seem to have a good handle on, obviously, club channel and shipments and products and stuff like that. So, was there something that surprised you intra-quarter, or just help us understand that? Yeah. So... Oh, go ahead. Why don't you go? Yeah, no. Yeah, I think Darcy touched on this a little bit earlier. So, it really comes down to the timing of shipments. So, we did have some shipments into club and to other customers to refill some of the out-of-stocks, as well as to ship some of the new distribution in bottles and other in some of our other flavors. It just happened later in the quarter than we expected. And so that had a direct impact on our consumption growth in the fourth quarter, which, as Darcy mentioned a minute ago, it was about a 400-basis point headwind to our consumption growth. So, we were around 10%. If you add that, that would put our consumption growth at about 14%, if that were shipped on time. It, we have shipment timing changes from time to time. It's not uncommon. It's just when you're not at full safety stock internally, those things sometimes fall out, and that's what we saw in the quarter. Got it, and I'll have a follow-up, and then I have another follow-up. But did that then impact your July sales? Is why it got a boost because of the timing of shipments? I would not say it necessarily... Well, so let me back up. So, you saw consumption start to accelerate in June and more into July, and that is largely because of us getting that, those out-of-stocks filled, as well as getting that distribution into the trade. So that did have a direct impact on consumption, which is why you saw it accelerate in June and further into July. Got it. Okay. And then my real follow-up, just back on pricing, and especially as we move forward, I mean, I'm just trying to couple the commentary of everyone in your category is, you know, playing well in the sandbox on pricing, but you're sourcing most of your new customers outside the category. And so as we hear of CSDs and energy drinks and others talking about more promotional levels just to kind of revive their categories, you know, does that come into your thought process as you think about pricing and promotion as we move into fiscal 2025? I think, Bill, I think this comes to what are they trading? What are they giving up to buy? So, the people outside of the category, what are they giving up to buy a shake? So, for instance, most of our occasions or breakfast replacements. So, in essence, what consumers are trading out is, you know, an Egg McMuffin, a bagel and cream cheese, et cetera. And so those things are, for the most part, more expensive than a $2 shake. And so, I think that that is where I think we see so not only is it, you know, less expensive, but it's also a much more healthy breakfast. And so I think that's where you're seeing, and that's why we feel like, you know, all of our data would say that we have pricing power. Got it. No, that helps a lot. Thank you. Thanks. Thank you. Please stand by for our next question. Our next question comes from the line of John Baumgartner with Mizuho Securities. Your line is open. Hi, good morning. Thanks for the question. Good morning, John. First off, Darcy, I wanted to ask about innovation and long-term development of active nutrition, and you touched on it a bit with your comment on big "I" innovation. But more broadly, as we see the high protein, low sugar formulations becoming standardized, to what extent do you think this category can evolve? I guess similarly to energy drinks, where you're now including ingredients and functions in combination with caffeine. I mean, how do you assess protein's ability to evolve similarly between liquids and powder? And I'm thinking here 3, 5, 7 years, not a fiscal 2025 comment. Well, I think the first piece, and it goes back to what I talked about in my prepared remarks, just about kind of how amazing the nutrient of protein is. Just how the more we learn that the wide variety of people it is beneficial to, which obviously has innovation ramifications, as well as the benefit it provides, which also has innovation ramifications. So I think there is, I think there is such a huge opportunity, which actually, I know you asked about big I innovation, but actually, that is the reason why we are so encouraged by the little I innovation, because there is so much upside just by putting our, you know, existing formula or something close to it in different packages, in different kind of pack sizes, in different formats. So, there's that, 'cause there's, there's a ton more kind of household penetration potential. Then you go to the Big "I" innovation, and if you look 5, 7, 10 years out, I think what you'll see is, protein as a part in complement with other functional ingredients. I mean, I think that the, the specialty, you know, if you walk into a... The mainstream gets influenced by kind of two places. One is sports nutrition, in kind of the specialty world. You walk into a Vitamin Shoppe, GNC, and you see where, you know, that part, that side is going, or from, like, natural, right? So those are the two places that influence it the most. And when you go into those places, you see a combination of, you know, real food, so that has an influence, but then you also see really, you know, leaning into function. And so I think that's where the category will go. Great. Thanks for that. And then, as a follow-up, in terms of competition in RTD, you know, Tetra supply has been the standard and tightness has been a major barrier to entry. But we're seeing some of the newer entrants adopting bottles, and I'm curious your take on industry bottle capacity, the extent it can be a means for newer players to sort of circumvent the Tetra tightness, and the extent to which bottles can play in channels such as, you know, mass and club, as opposed to just more of a single-serve opportunity. So, bottles is also constrained, and it really is. I think that what is constrained is the upstream aseptic processing. So, whether you put it in a bottle or a Tetra, it is the aseptic processing upstream capacity that is constrained. But I think that in general, in the same time that the Tetra capacity is opening up, so is the bottle capacity, and that is what you're seeing. And yeah, I think we see the opportunity for bottles. For us, because it's a smaller part of our business, we actually see the potential for the growth potential of bottles, actually, you know, the growth being bigger for us, not numbers of shakes, but we see that there is a... That's when I talk about format, that is one of the formats that we see potential with. Great. Thank you, Darcy. Yep. Thank you. Ladies and gentlemen, I'm showing no further questions in the queue. This concludes today's conference call. Thank you for your participation. You may now disconnect.