Good morning, and thank you for standing by. Welcome to the Flowers Foods Q4 and Full Year 2024 results conference call. Please be advised that today's event is being recorded. I would now like to hand the conference over to your opening speaker today, J.T. Rieck, Executive Vice President of Finance and Investor Relations. Please go ahead. Thank you, and good morning. I hope everyone had the opportunity to review our earnings release, listen to our prepared remarks, and view the slide presentation that were all posted earlier on our Investor Relations website. After today's Q&A session, we will also post an audio replay of this call. Please note that in this Q&A session, we may make forward-looking statements about the company's performance. Although we believe these statements to be reasonable, they are subject to risks and uncertainties that can cause actual results to differ materially. In addition to what you hear in these remarks, important factors relating to Flowers Foods' business are fully detailed in our SEC filings. We also provide non-GAAP financial measures for which disclosure and reconciliations are provided in the earnings release and at the end of the slide presentation on our website. Joining me today are Ryals McMullian, Chairman and CEO, and Steve Kinsey, our CFO. Ryals, I'll turn it over to you. Okay, thanks, J.T. Good morning, everybody. Welcome to our Q4 and full- year call. Our team accomplished a lot in 2024. We grew dollars and units and tracked channels across our branded bread portfolio, helped by innovation and strong market execution, and continued implementation of our portfolio strategy drove improved sales and margins in our away-from-home business, despite the impact of those deliberate business exits. Offsetting that performance has been persistent category weakness, which led to lower-than-expected sales results. The biggest headwind from both a revenue and a volume growth standpoint is significant weakness in the sweet baked goods category. However, we're implementing concrete initiatives to offset that weakness and believe our portfolio is very well positioned to capitalize on current and long-term trends. Looking forward into 2025, our financial guidance is cautious given the volatile environment. The potential for tariffs, commodities volatility, higher promotional activity, and continued weak consumer demand influence that cautious outlook. However, we are very optimistic that the strength of our brands, our successful history of innovation, and the innovation of Simple Mills to our brand portfolio will enable a strong longer-term performance. And with that opening, Gigi, we'll open it up for questions. Thank you. As a reminder to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Steve Powers from Deutsche Bank. Good morning. Morning, Steve. Can you hear me, okay? Yeah, loud and clear. Okay, great. Okay, sorry. Hey, so can I first ask about Dave's? It's been good, obviously, for a long time, but we've seen the core bread in that franchise start to run negative in consumption data for, I guess, about the last 12 weeks. I think it was down about almost 3% in the last four weeks. I'm quoting Nielsen data. So can you talk about just kind of what you're seeing there and how you expect the DKB franchise to perform in 2025, both kind of core bread and then the entire lineup? Thanks. Sure. Let me start with just the core bread, Steve, just so I'm clear on this. First of all, we've documented where our challenges are in the sweet baked goods category and a little bit in the soft variety white bread areas. DKB is not one of those challenges. DKB is a strong brand. It'll continue to be a strong brand. There is a bit of noise in those numbers. We had an SKU rationalization of a couple of underperforming SKUs that affected it. If you're looking at the Q4, there's always some seasonal noise in there. The Q4 is typically fairly weak for sandwich bread. But nonetheless, we did still see very, very strong growth in some of our breakfast items, sandwich buns, and rolls. And I'd add to that, we've got new products coming this year to replace those deleted SKUs. Plus, we're getting very significant space gains this year for Dave's, which is really important. One of those of note is in the mass channel in over 2,000 stores where DKB has been underpenetrated. And I guess the final thing I would mention from a household penetration standpoint, DKB hit a record this year, even higher than the pandemic year of 2020. So all that points to continued consumer interest in Dave's. We'll, of course, continue to innovate with Dave's, and we're not worried about that at all. So hopefully that helps give you some color. And then, of course, you add the snacks on top. The bars continue to do very well. We're really excited about the Snack Bites launch, which is underway as we speak. So as you think about it more as a mega brand, we're even more confident. Okay, that's very helpful. I appreciate it. And if I could, maybe a two-part follow-up, and then I'll pass it on. The first part is for Steve. I wonder if you could better dissect kind of the first half, second half dynamics that you called out in the prepared remarks. You cited some dynamics that will definitely help the early part of the year. At the same time, as you go forward, underlying comparisons, you've got Simple Mills rolling in. You've got the extra week. So I would have expected maybe a little bit different cadence, maybe some color there. And then Ryals' second part, you mentioned some external research on GLP-1 drugs and related consumer behavior. I'm just curious if you could elaborate on what that research is and kind of what you're seeing there and how you're going to address it? Thank you. Sure. In the first half, primarily what we're looking at in the first half is we'll begin to lap some of our new business and lap some of our pricing and some of our savings gains that we saw last year in the back half. There is some pricing that carries over in the back half on primarily private label and foodservice, but a lot of the branded pricing we do lap in the first half. And then the other major item for the first half has to do with commodity costs and input. The way we take coverage, we are seeing some benefit in the first half of 2025, but given some of the firmness you've seen in the markets of late, right now we're forecasting some continued inflation with regard to input costs in the back half. Okay. Steve, to your question on GLP-1s, I mean, it's a fascinating topic, right? And everybody's still trying to figure out what the impact is, what the magnitude of the impact is, what the magnitude will be going forward. And if you were scanning all the research, like I'm sure many of you are, some of it's conflicting, so it's hard to get a firm handle on it. But we do want to be cognizant of it. Some of the work that we mentioned in the prepared remarks is from some work we did with Circana. So that's where that came from. But what I would say is that if GLP-1s do become a major factor and affect overall food consumption, we think that we're very well positioned for that. You see where we're taking the portfolio. It's definitely starting to skew much more better for you, cleaning up labels, the dominance of DKB, having Canyon, and then, of course, adding Simple Mills to that mix too, because a lot of these people that are on GLP-1s will be searching for items just like Simple Mills. So with all those factors in mind, we're shaping our portfolio to kind of meet that new consumer that is taking those medications. Very good. Thank you. I'll pass it on. Thank you. One moment for our next question. Our next question comes from the line of Bill Chappell from Truist Securities. Thanks. Good morning. Hey. Just a little more, I guess, color on your caution for the category and in terms of what you're seeing, and I guess it comes with, do you think you have pricing power or the consumer's weakened? Is it just behavioral change? Because obviously some more people are going back to work and maybe not having as much bread at home. Are there any macros that drive that caution, or is this just trends you've been seeing and came into the Q4 and you expect them to continue as we move into early next year? Yeah, Bill, it's mostly the latter. So sort of overall pressure on the demand environment. But I would add to that, specifically to our category, it's that consumer shift away from soft variety and white breads, which I think we're very well prepared for. We talked about it in the prepared remarks. I mean, soft variety and white bread were weak. I'm talking in terms of the whole year now, not just the Q4. However, the investments that we've made in innovation around keto and gluten-free and organics and our sandwich, bun, and roll business, particularly under the national Wonder label, were more than enough to offset that. So if you take the cake piece out of branded retail, we were positive in units and dollars for the year in branded retail. Cake is really where the weakness has been. So the outlook, we've seen some of those trends from last year spill over already into the little bit of this year that we've already experienced, though it's obviously very early. I do have some confidence that QSR will start to recover. We're starting to see more positive comments around that. So perhaps second half this year, some of that volume will come back to our foodservice business, helping overall volumes. But from a branded retail standpoint, we feel very good about where we are branded bun and roll-wise with the brands that we have, the innovation we have. And then with respect to the cake business, the introduction of the Wonder brand is, I mean, the intention of that is to help stabilize that business. It has been weak. The category has been weak overall, as you all know. But the reception that we've gotten from our Wonder snack lineup has been tremendous, honestly. And if the retailers follow through with that, this will be more of a Q2 thing because it doesn't launch until week 17. So it won't have any bearing on the Q1, but we're very optimistic that that will help stabilize that piece of the business. And obviously, that has a profound effect on just given the weakness on the cake side of things. That has a profound effect on our outlook for the year. So starting the year, definitely taking a cautious outlook for all the reasons that I just enumerated. The promotional environment has continued to be somewhat elevated. I wouldn't say it's ridiculous, but it is elevated, though what we're seeing in terms of lifts are not what one would normally expect, speaking sort of total category. We've been much more nuanced in our promotional behavior, but the category overall has been somewhat elevated. So we're keeping our eye on that too. Really, honestly, a continuation of the trends that we talked about on last quarter's call. There hasn't really been any marked change to that yet. Certainly looking to see if we see some improvement in consumer demand in the back half. So that overall is what's driving the cautious outlook, at least to start the year. Got it. And just, I guess, as a follow-up, I mean, guess what I'm trying to understand is why, if you have ideas why there's a migration away from the white bread, it would seem that it's still kind of a low-cost solution for lower-income consumers. Not sure what they would be trading up from $1 a loaf private label white bread to Dave's Killer Bread at $4. I mean, so I'm just trying to understand if you think this is temporary or this is part of a trend and if you know kind of the factors that are really driving that. Yes, we do. And that's what I'm trying to say. I think that it's more of a secular shift away from those categories. I think we've talked for several years now about the shift to more differentiated premium items. So some of that obviously is coming to us in the terms of Perfectly Crafted and Dave's Killer Bread. Other parts of it are going to the perimeter of the store. Other parts are going to tortillas and flatbreads. So consumers are looking for something different. Yes, there's still value, and there's still value consumers that buy private label or Wonder or Nature's Own Butterbread. But it strikes me that there's definitely been a shift in tastes and preferences away from those main line items. So we've been ahead of this, as I mentioned, and with our keto lineup and everything else that I talked about, we're meeting that new consumer demand and so far offsetting the softness in those traditional categories. Got it. Great. Thanks for the color. Thank you. One moment for our next question. Our next question comes from the line of Robert Dickerson from Jefferies. Great. Thanks so much. A couple of quick questions. I guess just first question, as we think through the year, kind of cadence of the year, maybe this goes back to Mr. Powers' question as well. I mean, should we kind of be expecting some kind of, let's say, more category softness, right, in the first half of the year, maybe until you lap the category softness? So if we're thinking about top line and just organic volumes in general, I guess combined with maybe some of the innovation that comes later in the year, then maybe we're a little softer top line first half, and then hopefully there's a little bit of momentum as we get through the back half. That's a simple first question. Yeah. Yeah. So from a top line standpoint, I think that's roughly correct. I don't really see any change in the consumer demand environment anytime soon overall. But we do have, as we mentioned, the Wonder launch will be right at the beginning of the Q2. We actually have a lot of new business wins, significant business wins. Most of those come in after the end of the Q1. So I think as you think about cadence through the year in terms of our efforts to win new business, geographic expansion, new items, innovation, that's mostly at least a post-Q1 item. And then, as I mentioned, QSR demand, that coming back would certainly be helpful for the foodservice side of things, but I'm not sure we see that until the second half either. Yeah. Okay. Fair enough, and then, Ryals, maybe just on coming back to the conversation around traditional white loaf, etc. I mean, I do feel like, right, if we go back like a decade, right, I don't know, whether we think of some of your core competitors in bread and we think about kind of just like how the shelf looks, right? If I personally walk in a grocery store, now we have 18, 27, 32 grains, right? We have Country White, Hearty White, Hawaiian. I mean, there's so many different options now in bread, right? I mean, we're kind of simplifying to an extent, right? There's a little bit more premium or, let's say, better for you. I mean, I could argue that it depends on how you're defining better, but whatever. Is there maybe just a part of the market where within bread, and let's ignore Dave for a second, where you clearly could or should or maybe you do, right, have an opportunity to kind of more effectively compete, let's say, with the, I guess we could call it more harder loaf, right? I mean, you're calling it soft loaf. Because it does feel like there's maybe a little bit more traction on that side, and maybe that's just viewed as more premium, even though maybe the health attributes aren't better. I don't know if that makes sense. So Robert, are you talking about more artisan crusty bread? No, I'm talking about if I go to the grocery store, I look at Arnold and Pepperidge Farm, and they have harder, more kind of more solid Country White, Hearty White. I'm seeing people maybe purchase that a little bit more frequently relative to the softer loaf dynamic. So I'm just bucketing the different subcategories differently. Yeah. And I think that's a great example of where the market is shifting to. So if you think about white breads, for example, and what we've done with Perfectly Crafted. So while the traditional loaf under Nature's Own has been Perfectly Crafted, was up 8.5% in units in the Q4, which is typically a weak quarter. So that's one example. And we have a white bread under Dave's as well. So that's giving the consumer a place to go that's more premium and more differentiated than those main line items, to your point. And then, so if we just think about the overall supply chain, does it make sense to maybe just gradually infill some of the shelf on certain brands with maybe the examples you just gave? I don't know. I don't know if there's a cap on the TAM, but it would seem like the market's going that way, maybe it takes you a little while to get there, but it feels like you have the capability to kind of get there. Yeah. No, I think that's right. I mean, as you say, it's an evolution over time. I mean, it's down, but make no mistake, there's still a lot of Nature's Own Honey Wheat sold. So from a volume standpoint, it's still a huge piece. Same for Butterbread and the other main line Nature's Own items, but plants are pretty flexible, Rob, as you'll recall. So as we move forward and the consumer preferences shift, we can run these items on the same lines we already have for Nature's Own. So there's a lot of Perfectly Crafted made in the Miami bakery, for example, which we've had for 50 years, and it makes Nature's Own Butterbread, but it also pumps out the Perfectly Crafted as well. Dave's is a little different, obviously, with the organic and obviously gluten-free is even more different just given the segregation required. But yeah, our network is set up to be flexible in that regard as those preferences shift. Yeah. Okay. Perfect. Makes sense. And then just maybe one question for me on the Wonder snack launch. I mean, within the prepared remarks, right, I guess kind of the term or terminology around healthy consumption, better for you, etc., does continue to pop up. Kind of, we're all aware around what's going on in the perimeter relative to the center of the store. I mean, I guess one could argue it either way. Maybe a Wonder Confetti Cake is more premium or maybe for somebody it's classified as better for you. But it seems like maybe it's just a good opportunity to kind of take some of the capacity you already have, right, within sweet baked snacks and just try to shake it up a little bit, right? I mean, clearly, Wonder, it has very high consumer awareness. It's probably one of the highest within all of baked goods. So is the idea as you speak with the retailers, "Hey, here's a category that's clearly under a bit of pressure," and it's been that way for some time, and there haven't really been a lot of new entrants, right? So maybe this is something that could actually work as consumers want something new and trial, not necessarily because it's premium or better for you. That's all. Thank you. I think you said it. Yeah. Yeah. I think you said it. I think you said it very well. I mean, Wonder is an iconic brand. It's got 98% awareness, so it's among the highest in food. And we've talked a lot about the fact that one of our competitive issues in the cake business is just the lack of a brand to go up against the larger players with. We're a bit disadvantaged from that standpoint. I mean, Tastykake's a great brand if you're from Philadelphia or the surrounding area, but if you're from Cairo, Georgia, maybe not so much. But Wonder definitely resonates. I would also say that the quality is also a factor, and we believe that our quality is superior, and we've been told by our retail partners that our quality is superior. So we think that gives us a nice competitive advantage as well. Just quickly, could that product line be launched nationally kind of relative to Tastykake, or is it probably more in kind of a Tastykake regional play? No. We can go national with Wonder. A, it's a national brand, and B, this is all warehouse distribution. So we're not limited by the DSD. Super. Super. All right. Awesome. Thank you. Appreciate it. Thanks. Thank you. One moment for our next question. Our next question comes from the line of Jim Salera from Stephens. Yes. Good morning. Thanks for taking that question. I appreciate some of the detail on 2025. I wanted to maybe parse out some of the legacy business. If my back-of-the-envelope map is correct, if I take the midpoint, strip out the 53rd week and the Simply Good, or I'm sorry, Simple Mills acquisition, that gets just shy of 1% growth for the core 52-on-52-week legacy business. How should we think about the kind of expectations for the components there? It seems like maybe foodservice still down modestly, the core bread offering maybe up a little bit, and then sweet baked goods kind of a variable. So if you could just kind of give us a sense for the components of the legacy business for 20 25? Yeah. I mean, I think you're thinking about it right, number one. But secondly, I'd say a lot of that 1% growth will be mix-driven. And as Ryals pointed out, the performance of our premium brands continues to be really strong. So we're forecasting good performance for 2025 from that perspective as well. We believe, as Ryals said, Wonder cake should help from a cake perspective. But again, that doesn't really kick in until the Q2. And we are expecting some recovery from quick-serve foodservice during the year as well. So when you look at kind of that 1% growth, a lot of that's going to be mix-driven from a pricing perspective. We've taken pretty substantial pricing over the past couple of years. There might be a pocket here or there or something very selective, but for the most part, it will be mix-driven. Okay. That's helpful, and then maybe a second question on some of the innovation and formatting. Ryals, in your prepared remarks, you mentioned having the opportunity to offer consumers smaller loaves that maybe make the product a little more accessible from an absolute price point perspective. And then also, they don't have to worry about spoilage and maybe throwing away a couple of extra slices. Can you just give us some detail? Is that across the whole portfolio, or is that just with certain brands? Is there an opportunity, especially thinking about GLP-1 impact, to kind of expand that across the portfolio to make it more accessible and reduce the weight? Yeah. I think it's a we'll see right now, Jim. We currently only have it under the Nature's Own brand for the small loaves. We are looking at it for Wonder as well. And then, of course, this is not exactly analogous, but DKB has had for a long time the thin slice, which is a much smaller loaf than that big super premium wide pan bread. And we do find that it's a lower price point, obviously. Margins are still good for us, and that's a consumer need that we're trying to meet. There are others out there. We're not always the first to market. We weren't the first to market with keto, and yet we're number one in that subsegment now. And there have been others that have been earlier to market with the small loaf. And we've been watching it. It's done well. It's obviously a need for certain households, and so we elected to meet that demand. Great. And Great. And then if I can sneak in just one last, Ryals, you mentioned very briefly in the beginning of the Q&A just some uncertainty on tariff. Can you just give us maybe just high-level thoughts on what tariff exposure might be and just any impact that might have? Yeah. Jim, this is Steve. I mean, I'm sure you'll assume this. Basically, it's ingredient-driven. We have taken into consideration some estimates of the tariffs, and that does flow through our guidance. We looked at ways to mitigate that the best we can. But the reality is a lot of it's ingredient-driven, and as you would expect, most of it's Canadian or Mexican-driven. There is some in China, but the majority of it would be from those two countries. Okay. Great. Perfect. Thanks, guys. I'll pass along. Thank you. Thank you. One moment for our next question. Our next question comes in line of Brian Holland from D.A. Davidson. Yeah. Thanks. Good morning. Maybe just following up on some of the earlier lines of questioning. I think Jim's point implied 2025 guidance top line, excluding acquisitions, excluding 53rd week. We're looking at like 80 basis points of growth at the midpoint, which I think on its face looks modest. But for the last three quarters, your sales have declined. Volumes have gotten worse. Category trends are softening as we move further softening. I'm talking about all packaged bakery as we move through Q1. So maybe to the extent that you could sort of parse out, because it strikes me that innovation is the incrementality of that, and maybe some of the new business wins on the foodservice or in the non-retail business would be the primary drivers above and beyond maybe a down category and just some natural share growth on your part. So maybe at its most simplistic, do we have a bigger innovation wave in 2025 and 2024? And where does that fall if you were to tier the drivers bridging from where the category is to where you're guiding for 20 25? Yeah. Brian, so lots to talk about there. So several things. One, I think I heard you say new business in the away from home. Most of the new business is on the retail side. So we are picking up some private label, but we're getting a lot of brand concession for that as well. I mentioned at the outset of the call, part of that is some significant new space for DKB, which is going to be great for us. And there's a litany of others. Then you also have the Wonder launch. As I mentioned, that's going to be Q2. It won't have any effect on the Q1. So that's going to be a big part of it. And then to answer your question on innovation, yes, we do have a higher innovation goal for this year than we did last year. So it's a combination of things. And all of that's intended. We're still saying for the time being, we're not expecting any major positive changes in consumer demand. That's why we started the year cautious. But all this stuff is meant to offset that. And then, of course, if consumer demand starts to improve, which we believe it eventually will, we're very well positioned to take advantage of that. Yeah. No, appreciate that. That's all helpful. Thank you. And then just quickly on Simple Mills, I think you'd put 2024 net sales last month at $240 million. Your guidance in 2025 implies something a bit below that. I suppose that that's probably just less than full year contribution explains the implied decline. But if I have that right, just a sense for kind of what you're assuming for that business on an apples-to-apples basis in 2025? Yeah. I mean, for 2025, obviously, it's roughly 45 weeks if we stay on the closing schedule that we've assumed here. And then from an overall growth perspective, we are assuming some modest growth for 2025. So if you say modest growth for 2025, I think the business has grown at like a mid-teens CAGR or something like that. Is there anything with respect to just integration, etc., that you might explain why the implied guide for that business would look more conservative than what the historical trend has been? Or is that just conservatism, not dissimilar to the way you're trying to approach your core business? Yeah. Let me comment, and Steve can add on to this. First of all, it's a little tricky for us because we haven't closed yet. So we're assuming a certain number of weeks in this contribution. So we've kind of given a range to give ourselves a little bit of breathing room there just because we haven't closed yet. We do expect it to be soon, but as of today, we haven't closed. The second thing I would say is that we're very, very bullish on this business. We wouldn't have paid the premium that we did if we weren't. But we do need to get them integrated. And we can't do a lot of that, obviously, pre-closing for regulatory reasons. But once we get in there and we decide how we're going to work together and the things that we can bring to them to accelerate their distribution gains, their innovation pipeline, etc., it'll take a few months for us to get there. So I think it'll come into much clearer focus, though I know it's probably frustrating for your modeling efforts. It'll come into clearer focus after we get closed. Yeah. And Brian, I don't know if you had a chance to look at the deck yet, but on slide seven, we do call out that we're assuming a full year pro forma contribution of roughly $258-266 million from a top line perspective. So that should be able to help you from a modeling perspective. Okay. Thank you. That is helpful. And then if I could sneak in one more, just any thoughts, Ryals, about how the promotional landscape might evolve as commodities become a headwind for the category into 2025? I think historically, an inflationary environment upstream has tended to be beneficial for Flowers, just given kind of your hedging strategy vis-à-vis the balance of the category. So maybe just any thoughts there? On the promotional environment, you mean? Yeah. Right. I mean, I think we've seen an increasingly competitive environment. I know you've talked about that being below pre-COVID levels, but commodities have been a bit of a tailwind to help support that. If it goes the other way, if you assume that a lot of the smaller independents don't have the same hedging or forward-buying practices that somebody like Flowers might have, that they would have to correct more quickly to account for that. And again, historically, I think that's been a net benefit for Flowers. Just curious how you think about that? Yeah. I would think about it exactly the same way, though it'd be just pure speculation to figure out exactly when that might happen and what they might do and when. Yeah. You're right. Historically, it has overall been a benefit, and I mentioned a while ago, we've been watching the promotional environment very carefully. No surprise. I mean, for us, I mean, the base units have been a little bit weak, but our promotional cadence has delivered some pretty nice incremental units. On the other hand, we have seen more broadly across the category, deeper, perhaps more aggressive promotions, and our analysis shows that those are not delivering from an incremental standpoint. So certainly, my hope is that that stabilizes and pulls back, but in the meantime, we're going to continue with the same strategy we have. I mean, we have the number one brands. We don't have to promote as deeply because of the strength of those brands, and we'll continue utilizing that strategy. Great. Thanks. We'll leave it there. Thank you. One moment for our next question. Our next question comes from the line of Mitchell Pinheiro from Sturdivant & Company. Hey. Good morning. Most of my questions have been asked, but I do have just a couple of things. Regarding guidance, the Flowers standalone, earnings per share is flat to down versus 2024, but you have perhaps a modest increase on the top line. So is that gross margin, or is that SG&A decline or pressure on earnings? I think you'll see more pressure within SG&A. And is that workforce-related? I mean, is that related to California transition or just general workforce-related pressures? I think you'll continue to see some of the pressures we talked about on Q4. You'll continue to see workforce. You'll continue to see an increase in overall lease or rent expense. So it's really related to the truck leases and rentals for California. And then you'll continue to see cold storage expense increase as well. So several factors within SG&A are forecasted to be up year- over- year. I think from a gross margin perspective, we're not really guided, but I think overall, we should be okay 2024 to 2025. Yeah. Mitch, as well, just remember that as we move through the Q1 of this year, Steve already mentioned the lapping of the pricing, but we will also start to lap the savings initiative that we launched last year, that $46 million that we saved in 2024. Okay. And then you had a comment, I guess, in the prepared remarks talking about the California transition going to drive some improved results. What are you trying to say there? I mean, because that's going to be a company-owned model versus your traditional independent model. Is that saying that you could be more efficient with a company-driven model? Yeah. I would think of it in terms of control. Obviously, with our IDP model, we have very limited control there because they're independent business owners, as you know. Whereas with the transition in California, kind of taking back control over distribution, days of service, display execution, we have a lot more ability to drive our business ourselves with an employee model there. Now, Mitch, as you know, we were forced to do that in California. This wasn't necessarily by choice. So we'll see how it goes. On balance, as we've mentioned, it is a little bit more expensive to use a company-owned model than it is IDPs, primarily due to the truck expense that's on our books. But our aim is to more than offset that via that control with enhanced sales growth, primarily, honestly, if nothing else, increased days of service. We all know how important Sunday service is, and that can be somewhat uneven with an IDP model. All right. Thank you. And then I just want to ask, and I forget if maybe someone else asked this already, but the small loaves that you're putting out, you've thought about it before, but it sort of didn't quite make sense in years past for a variety of reasons. Have you solved any of the small loaf margin issues, or is that something that you got the right margin mix there, or could it be a margin drag for you? It's not a major margin drag. First of all, it's not big enough yet really to have that big of an effect. But to answer your question, it is a little bit lower than the main line items just due to the fact that we're not really set up to just produce a small loaf. There's some complexities in the plants. However, if we start to find success with this, we would go and make the necessary changes in the plants to fix that. And that would go a long way to helping the margin profile. I'm not really worried about it right now. This is really more of a test-and-learn circumstance for us. But if it's doing well, if it continues to do well, we've got more SKUs coming out to help support it. If it really takes off, then we'll make the necessary investments on the supply chain side. Okay. All right. That's all I have. Thank you for your time. Thank you. One moment for our next question. Our next question comes from the line of Max Gumport from BNP Paribas. Hey. Thanks for the question. Just turning back to the commentary on promotions, you're clearly of the mind that the promo intensity we're seeing is not the solution to volume pressure in the bread category. And that sounds like a prudent approach to be taken given the lack of lifts that we're seeing. It's not clear, though, that your competitors are of the same mindset and stepping away from promotion. So how would you think about navigating through an environment if you have large competitors that continue to promote through the year, even if a bit irrationally? Thanks. Yeah. Right. Can't control what they do. Understand that. But I think, simply put, if you look at our market share performance relative to some of the competitors that you're talking about, I think you'll find your answer there. Our performance has been much better, and we don't promote nearly as deeply. I think our overall price per unit was down maybe a penny in the Q4. One penny. Up one penny in the Q4. Sorry. In the Q4. And that typically tends to be a higher promotional quarter just given the seasonality. And yet our market share performance was better. So I would leave it at that. Okay. And then turning back to the expansion of Wonder into sweet baked snacks. So I mean, clearly, you noted that one of the biggest headwinds you're facing right now is that weakness in the sweet baked goods category. And you're planning to address that head-on with the introduction of Wonder Snack Cakes. I guess I'm just wondering why that's the right strategy. I mean, to me, it would seem you can choose the categories that you play in. And so I'm wondering why you're choosing to get bigger in a category that's on the weakest in U.S. packaged food right now and potentially due to structural issues. That play. So just curious why Snack Cakes and not another category that maybe has better growth tailwinds behind it. You mean with the use of the Wonder brand? Exactly. Why expand Wonder into Snack Cakes now? Why is Snack Cakes the right category? Why not think about a different category that isn't under a whole lot of top line pressure? Right. Well, I would put it this way. We're in the sweet baked goods business, and it's a headwind, and it needs addressing. I think that's very clear. And we've documented it for a number of years that it's been a headwind from us first operationally and now from a top- line standpoint. And we think that Wonder translates much more easily and seamlessly into the sweet baked goods category than it might others. Okay. And then I'll throw in a third question as well. Just c ould you provide a bit more color on the Circana research that you're citing, particularly with regards to the comment about how you're seeing, or Circana is seeing, households on GLP-1 drugs start to revert even more fully back to center store items. Curious, are there center store items in particular that they're reverting to? Did they give you any reasons for why that counterintuitive shift is occurring? Thanks very much. Yeah. Yeah. Sure. I mean, and look, I mean, the research that we're citing is, as I said earlier, one of many. I think some of these even tend to conflict with each other. But yes, we have seen some data that shows that people start that medication, and when they stop, they come back, and they buy more than they did before. But I think it's one point in time. It's one data point. I would caution everyone on that. I don't think I've been very clear that I don't think anyone has gotten this completely figured out yet or knows what the long-term implications of it are. I think the important thing to note is that regardless of the outcome, we're positioning our portfolio to be successful in any environment. Okay. Thanks very much. Thank you. At this time, I would now like to turn the conference back over to Ryals McMullian, Chairman and CEO, for closing remarks. Thanks, Gigi. I want to thank everybody for taking time today and joining us for questions. Thanks very much for your interest in our company. And as always, we look forward to speaking with you again next quarter. Take care. This concludes today's conference call. Thank you for participating. You may now disconnect.