Okay, everyone, we're gonna get started. My name's Jim Salera. I run the packaged food and beverage practice here at Stephens. With us today from Utz Brands are Howard Friedman, Chief Executive Officer, and Ajay Kataria, Chief Financial Officer. Thank you, guys, for joining us today. Excited for our conversation. Howard, I wanted to start with a question for you. You know, you've been in the CEO seat for almost a year now. You've gotten the opportunity to really sink your teeth into the business. What do you think are the biggest opportunities for Utz, you know, from where you guys are at now moving forward? Well, first of all, it's, we appreciate the invitation to talk with you and, and to be here. You know, it's, it's interesting, when I joined the company, the sort of the growth thesis that was presented to me was something that went like this: We were a smaller business, 2008, we were about $350 million with about 900 routes and, and four plants in Hanover, Pennsylvania. When, when I joined, we had 16 plants, 2200 routes, and, we were about $1.4 billion. So when you think about the sheer acceleration of the business, and we've done it through organic as well as inorganic opportunities, the question was: How do you have this business that is growing and growing quickly, have it grow into its scale and become a more effective acquirer over time by actually being able to fully integrate the businesses? We've done a great job of getting the businesses up and running and buying at good multiples, but how do you take a business that was really a branded house of Utz everything into a portfolio of brands like a Boulder Canyon, like an OTB, like a Zapp's, and what do you do to build that scale? So since I've been here, the good news is the thesis is largely the same, right? We are a growth company. We have growth ambitions. We expect to continue to expand nationally, and, you know, I, I think that the company has done a great job of activating its ambition to date and building on the expansion. The thing I think we all didn't fully appreciate is how much of a cost opportunity there is as well. And while we had always sort of played in, productivity and cost out, we would... You know, last year, we were about 3%. I think the company is now learning that there's a significant amount of cost that will help us pay our own way as we fund things like expansion and increasing the marketing support that some of these brands justify. I think the last thing is just the people. You know, we have an organization culturally that's pleased but never satisfied, and we've done a nice job of upskilling our folks and then acquiring external talent. That might seem somewhat self-serving, but to bring in new capabilities to be able to make this business achieve its full potential over time and continue on a growth and margin journey that we're on right now. That's helpful. You know, I think Utz has a lot of exciting brands in its portfolio. For those that don't know, I grew up in Pittsburgh, Pennsylvania, so your Cheese Ball Barrel was kind of ubiquitous at, you know, family parties and events that I was at. When you talk with your retail partners, how do you differentiate your product offering compared to maybe some of your bigger peers, and then maybe also some of the, you know, more regional- focused brands? Yeah. Well, you know, one of the things, I think that's nice about our portfolio is because we do have such a wide breadth from sort of premium brands like Boulder Canyon to more opening price point brands as well, what our retailers really like is they can actually work with us to curate an assortment that best helps them compete the way they want to compete. If you think about some of our competitors, what they tend to do is they compete the way they compete, and you can kind of like or dislike a lot the assortment that they're willing to offer. So we can move up and down from premium to mainstream. We can cover all of the subcategories as well, so we're sort of a one-stop shop. And we're a business that they... that, we have found to be largely incremental to the category and appealing to their shoppers. So if I'm a merchant, I say, "I want to attract the consumer segment I want. I want to deal with just one person who can meet all of my needs, and I'd like it to be incremental," we hit all three of those domains. I think something you mentioned there at the end, you know, being a one-stop shop, how important is it for retail buyers to be able to get kind of a wider breadth of product offerings from one company rather than, you know, kind of piecemealing regional brands together to fill out the snack aisle? Yeah, I mean, this is gonna again sound somewhat self-serving, but I think it's very important. What I would tell you is the merchant's, the merchant's job is to curate the products for their, for their aisle, and so they will meet with any and all of the merchants or all of the vendors who they think will help. What makes salty so unique is it's a category that the category consistently is growing, and so you're not moving peas around the plate, you're actually adding more peas to the plate by bringing in the assortment and choice that, you know, their shopper will want. So I think, you know, we are... I think that the merchants appreciate it, but I also think that the category allows us to have more co-opetition because the shoppers will consume the products, and volumes and value grow. If we look at your geographic concentration- Mm-hmm ... and kind of market share penetration, you know, much higher kind of east of the Mississippi relative to, you know, the western part of the country. What does it take to get the brand moving, you know, more westward, and to resonate more with consumers and retailers out there? And kind of, you know, what are your thoughts about expanding the geography kind of west? Yeah. I mean, look, I think the premise of us of our business and our brand is that we can hold our in our established core, and then we can continue to expand outside of our core geographies, classes of trade, channels over time. I think over the last couple of years, we've done a pretty good job of expanding beyond just our core. Obviously, we had success with Publix, which is not west, but actually south in Florida, but we've also had a lot of success in the Chicagoland area as we bought master distributors. And those are kind of the two predominant models that we that we use. We have customers that are interested in our business, that we have long-term relationships with, that we maybe were in one geography, but we can see, they can see the data, they can see what we offer, and they can see how it affects their shoppers... and a lot of them are, a lot of those national retailers have geographies where we're not in yet, and so we'll partner with them to try and move into the West. I think as long as we're doing our job in those boxes, that story is pretty straightforward. The second way is that we will buy master distributors and enter a geography that we believe the consumer dynamics are lend themselves to where we wanna go. We'll buy that distributor, convert into independent operators over time, but slowly seed the market with us. That example is the Chicagoland area that we did with... We bought the Vitner's. It was 12 routes in the Chicagoland. We brought our businesses in there, and now, you know, we're growing nicely in the upper Midwest. Since you mentioned Publix, I'll maybe ask a follow-up question on that. You know, Florida's a unique market for you guys because there's a lot of kind of Northeast, Midwest transplants down there. My people. So exactly. So, oh, probably a lot more familiarity with the brand relative to a market that you would enter out West. What have you seen, just in kind of the consumer engagement with the launch in Publix, and just maybe some color around kinda the rollout there? Yeah, look, I mean, so, so far, so good, right? So Publix took us in about 18 months ago. So we were in a couple 100s stores before. They took us chain-wide 18 months ago. And what we have seen is, we have been incremental. We have actually appealed to their core shopper. If you look at our household penetration and buy rate in those geographies, penetration is up, buy rate is at the category plus a little. So trips are there, and we've been invited to be given more shelf space since that. So 18 months in, we have more space than we did when we expanded nationally for chain-wide. So, you know, I think what we also know is that while I agree, half jokingly, I'm a New Yorker, so they are my people who are moving to Florida. What we've also found is we have other geographies like Chicago, which are now, I guess, technically my people, and other geographies as well, where our brands resonate because of the offering that we have. Product performs, the category is compelling, the price point is reasonable. And so what we find is pretty much everywhere we're going, even if you had affinity with the brand or not, we're fulfilling the portfolio role and meeting the consumer need that we expected. That's great. Maybe if we dig down and get more granular on some of your power brands- Mm-hmm. What do you think the potential is, maybe starting off with Zapp's, especially as you roll out, you know, the flavored pretzel sticks offering, and kind of the upside there? Yeah. So, you know, Zapp's is a great brand, heritage in New Orleans, and if you think about New Orleans, now we're sitting in Nashville, which is... could be confused, I suppose, for- Yep ... a trend-making city as well. But New Orleans is just an interesting backstory to the brand, right? So Voodoo as a flavor profile is very compelling, but I think the brand overall, rooted in food culture, rooted in what New Orleans can be, I think that brand has an opportunity to bring itself back toward its cultural aesthetic, right? And I think that that is a trend and a taste-making opportunity for us. You talked about pretzels. Pretzels and sinfully seasoned and spicy are things that are coming, but you'll see more of us rooted in the food and flavor of New Orleans. I think the brand needs a beat. That's my inner marketer coming out, and so we'll look at that as well and understand how music matters to that business. But the interesting thing for us, it's a highly correlated to millennial Gen Z consumers, so it's a younger brand, for us. That's great. And maybe to touch on another lesser-known brand, more known to me, I've been eating a lot of them recently, but Boulder Canyon, which I think has delivered very strong results for you guys, and kind of plays on, you know, some of these healthier oils trends. Yep. Can you just give us an overview of that brand, and offer some thoughts for the growth runway there? Yeah. So, again, Boulder Canyon, a smaller business for us overall, but huge growth potential. To your point, it's really rooted in healthier oils. So for folks who are, maybe looking for non-seed oil products, avocado oil is one of the points of departure for it. So it's traditionally in the natural organic classes of trade and sort of the premium grocery opportunities. So we have a class of trade opportunities to think about club, anywhere where more affluent consumers are looking for those products. The second place that we have an opportunity, and I should probably mention, it is the fastest growing avocado oil chip in the natural channel, so we're feeling pretty good about it. But we also have, much like we did with Zapp's, which is rooted in potato chips, we also have opportunities in adjacent categories where avocado oil and taste actually matter, and so we're looking at other ways to bring it and extending it into other occasions, into other segments as well. We love... You were talking about the Cheese Ball Barrel. We do love cheese balls for all of the right reasons, and I think Boulder Canyon is a place where we're pretty excited about. You'll probably see something there pretty quickly. Okay, that's exciting. I'll definitely keep my eyes peeled for that. We'll send you some. I know a guy. Okay. Perfect. If we think about, you know, the broader kind of better-for-you trends across really all food, you know, food and beverage, as some of these brands, like a Boulder Canyon, become more mainstream and enter kind of conventional grocery, do you feel that that gives you guys extra dry powder to use when you're talking with retailers, and that kind of complements the traditional salty snack offering that you have? Yeah. So, you know, again, if we go back to what I was talking about earlier, we can offer you a full range of products for it to allow you, as a retailer, to compete how you want to. So if you wanna compete on the more premium, better-for-you trend, you can do that. If you want to compete against all trends, we can offer you that as well. So, but what we do know is that a lot of these food trends tend to start in the premium classes of trade and start out west, and then they slowly but surely mainstream and progress eastward. And so a lot of what we're doing with that business is we want to maintain its premium position, we want to maintain what makes it special, but there are retailers who are asking for the product, and we'll continue to expand it. And then innovation and other offerings is what keeps it fresh for the more premium classes of trade over time. That's great. Why don't I pause and open and see if there's any questions in the audience, and if not, I can continue. Great. If we think about in the near term, kind of the overall pricing environment in the category, how are your retail partners thinking about pricing, and particularly promotional spend? Sure. What do you think about that kind of moving into 2024? Yeah, so I mean, we talk about this quite a bit, obviously, in the industry, and one of the things I would offer you is one of the nice things about the salty category is that it grows kind of year in and year out. It's kind of the-- it is the best category in, in food. The category leader has a lot to do with that, and I make no, I won't say anything otherwise, but what-- because of that, the need to drive greater demand, happens with a growing category. When demand flattens and the retailer can't make the revenue goals that they have, or profitability becomes an issue, that's really when you see the promotional environment really, really heat up, because they're-- if you don't have anything else to offer, price is the thing. What we have found in this category over time is we have rational competitors who compete rationally, and there isn't a race to the bottom like some other categories I've been in, in the past. So I think the conversations with the retailer are: "What are you doing to grow my units? What are you doing to grow my profitability? What are you doing to make sure that my shoppers are coming in?" And when you can answer those things, pricing is sort of the last discussion. There will always be some, obviously, because we're not a purely non-promoted category, but I would tell you that the environment continues and remains rational. I think, you know, keeping on that same train of thought, if you look at kind of relative price gaps in where you're positioned in the category, private label is positioned in the category, how do you think about... Is there, like, a target price gap you want to put yourself in, or, or what do you think about that strategy? Yeah, I mean, we talk, this is where talking about the price ladder matters, right? So private label as a business in this category tends to be relatively small, right? It, it shows up, and it's... And, and becomes more important in this, in this type of a business environment, in this economic cycle, because what the retailer will do is realize that inflation does cause some consumers to leak out the bottom, where they just either can't afford it or just choose to opt out. And so private label clearly plays a role. But it tends to ebb and flow over time. But to the question, yes, we'll, we will maintain- we will be clear on what our price gap is to the, to the primary competitor in whatever the segment is, and we will pay attention to our price gap to, on both the top and the bottom. So you need a gap to private label. If you're competing against them, you need a gap to the market leader, and then your next near proxy is the other one that we'll tend to, we'll tend to look at. So if it's a regional brand or somewhere else, but that's what good revenue management is, and that's something that we've been working very hard to become good at. You talked about, you know, obviously, there's a very large category leader, and they're pretty, you know, mechanical in how they think about pricing. In some of the categories where there's bigger, or geographies, I should say, rather, where there's bigger regional players- Mm-hmm ... do they maintain that same price discipline, or are they a little bit more kind of shoot from the hip? Yeah, look, I think I can't speak for my competitors and how they price for all of the obvious reasons, and I don't really know how they really think about it. What I would tell you is we don't see regional competitors behave any differently in the category. And again, that's really the benefit of a market leader who has a very clear point of view on all things price, brand building, product building, category building. The rest of us can more or less follow rationally and understand it, or make our choices to do something different if we choose. Okay. Talked about the Cheese Ball Barrels a couple times now, and I'll see if I- God bless you. Maybe I can sneak in a couple more references. There, there's nothing better than a barrel the size of your head. Nothing. As we think about kind of the specialty, limited time offerings- Mm-hmm ... how does that fit into your overall merchandising strategy? Maybe if you could talk about how that drives incremental buyers to the brand. Sure. Yeah, so it's funny, so we like limited- time offers for all of the obvious reasons. They tend to be good for our business for two reasons: one, it's a different occasion that where shoppers may not ordinarily think of our brand, and two, in some cases, we have people who shop the occasion, shop-- say, you shop Halloween, who get introduced to our brand and then will go down and buy the traditional products as well. So, you know, so we'll continue to do them. We have a pretty good presence in Halloween with a brand like Zapp's. It doesn't take a marketing genius to figure out we need to make sure that we're doing things there. But, you know, Utz does a great job with it. But we have a good limited time offer calendar. We'll continue to do them around areas where we think we can drive shopper interest, but it, without question, it drives trial of our portfolio, and, and we acquire new shoppers because of it. Maybe if you can also, again, on that same train of thought, give us some overview on multi-pack offerings, and success that you've seen there, in, you know, converting maybe a trial buyer to- Yeah ... to buying a bigger pack size. Yeah, so, multi-pack, variety pack is an area where, you know, to be clear, we still have a significant amount of opportunity. I think we transitioned into a bag, multi-pack bag a couple of years ago, then the category shifted into boxes. And we have done that most recently around, right around back to school. So we were in a format that was fine for the occasion, but probably not the right one relative to the competitive dynamics. So we're now in there. We've moved into a more merchandisable, better column, stackable, multi-pack, and variety pack. So either you're buying 10 of a single flavor or a whole portfolio of flavors. We have more offerings to come across all of our domains. Cheese balls, not surprisingly, just because you asked. And potato chips tend to be ones that we're where we're doing quite well in, and we have some, and we have some additional assortment that we're bringing. You touched on this a little bit, but maybe just to clearly kind of delineate for people, what is the advantage of a box versus a bag on the multi-pack side? Yeah, so, I mean, the biggest thing is that you can... It actually, this is gonna seem somewhat obvious, it can actually stand up in the aisle without anything else around it, right? So you can merchandise it differently. It shows up in the pantry better. It better protects the food, so you don't wind up with dust. And then from a presentation perspective, kind of think about the, say, you're five feet away, can you quickly identify the brand and what the product is at speed as you're shopping down an aisle? A lot easier to do with a colorful box than it is to understand it and have to stop and think about a bag. Great. The retail conditions are just better that way. Great. What about... You know, we talked about specialty a little bit, talked about traditional. What do you guys see in club? What are your thoughts around the opportunity in club, and is there maybe a brand or two that works better there, relative to, you know, some of the other channels? Yeah. So I mean, look, we're quite happy with our club business overall. You know, we're growing, we're growing that business, and, you know, the print has certainly been great. I think we have opportunity with all three club retailers, again, with different assortment and different offerings that I think makes us compelling for them. I think Boulder Canyon is a brand where we have a lot of opportunity. Utz, in our core markets, has got a bunch of opportunities, but if you think about club specifically, they tend to be tastemakers. So you'll go in, and you'll buy a product in club that you've never necessarily tried before. It's a great trial vehicle for us. It's also a lunchbox occasion, so people are shopping for their kids' lunchbox. So overall, I think we have opportunities with Boulder, with Zapp's, with core Utz, and I think we have it across all three. So more to come. That's great. And I think, you know, the three club retailers obviously have their own kind of unique positioning. For sure. When you're talking with the various club retailers, is there a different brand that you lead with for certain ones, or do you kind of... You know, how do you think about leveraging the portfolio to get your way in? Yeah. I mean, honestly, a lot of this starts with customer lead. We'll show a whole portfolio of choices, and, you know, we're mindful of member value, right? So you have to pay to go to a club store. You also have to buy more quantity than you would normally, right? A couple of the penalties. So what we want to know from the club merchants is: What do you want to start with? Do you want to start with a bag of, you know, a large-sized bag, or do you want to start with a variety pack? Which brands? But we'll curate an entire assortment and then actually walk them through what choices we have. But a lot of the... It's a very collaborative process of joint business planning so that when we get to the assortment that the club retailer wants, they have a pretty good idea of what they think is gonna happen, and then we can see if we perform relative to their benchmarks. In most cases, we do. In some cases, you go back and you try again. Great. I'll pause one more time and see if there's any questions from the audience. You talked about some of the cost opportunities. Yeah. Can you elaborate a little bit more on what those mean and what those are? Sure. Do you want to start, or you want me to keep going? Go ahead. All right, I want to roll. Get on a roll. So look, I think if you were to go back in time, we... The easiest way to remember it is one, two, three, four. So last year, we did about 3% of cost of goods on, call it, roughly $1 billion worth of cost out to our business. The year before, 2%; the year before, 1%. This year, we're gonna get to 4%. And I think we see in the foreseeable future, more cost opportunities and to stay at that elevated level for a while. But it really comes down to a couple of things. Number one, we have a portfolio of manufacturing facilities, some of which perform better than others. And so there's an opportunity for us with an ERP system to understand where the variations in our costs are and how to be able to attack the cost structure and get productivity and cost out by getting people level loaded and filling the plant, filling the network differently and/or elevating performance. So that's kind of base, you know, kind of run the railroad, continuous improvement kinds of things. I think the second is, we still tend to be relatively manual in a lot of our places. We have a lot of humans doing things that sort of traditionally branded businesses have figured out how to do. Think case packing, column stacking, palletizing, a lot of that still is done by humans, and the reality is, we have higher value-added work for those humans to do, if we can start to drive some automation and make those things more efficient. I think the third is, you know, I think over time, we've gone from 17 plants a couple of years ago. This year, as we sit today, we're at 13 facilities. I think over time, we, you know, we look—we're realistic about what our plant network could look like in the future, which will also unlock future opportunities. And then the last is really around procurement. So when we started out on this journey, we were not necessarily leveraging our scale with our suppliers, but more importantly than that, we weren't talking to our suppliers about the costs that we are creating by the nature in which we buy things. And so by working with our suppliers, we've been actually able to unlock cost savings of changing our behaviors and changing theirs, and being able to purchase things more effectively. A lot of credit goes to—we hired a Chief Procurement Officer this year. He's brought in rigor and discipline, and driven real savings that should be coming into the P&L as we go into next year. So all those things are, I think, all working for us. What our belief is, is that cost out is a virtuous cycle creator, right? If you do that, with that savings, you can invest some, and you can do some of the other things I think that the investor community would like to see us do: look at our leverage, think about our cash conversion, drive our top line, fund our expansion, and do it in a prudent way. I think, if we shift back and look kinda total category-wise- Mm-hmm ... you know, salty snacks moving forward, what are your thoughts around the category growth within retail? I mean, do you anticipate they continue to gain shelf space, and retailers will kind of allocate more SKUs, such that you can really add additional product without doing anything other than just growing with the retailers? You know, I would never speculate as to whether a retailer will give a category more space. It's not what I do, and every time I do ask that question to a merchant, they give me the store stretcher joke. You know, "Oh, I'll just get the store stretcher out, and we'll..." So it has to go from somewhere in the box, right? I think what we certainly see is that the category gets more endcap space, gets more perimeter space, and DSD helps feed those opportunities. So while the linear feet of the shelf run is one thing, the retailer and the merchants are more realistic about giving salty more space on the perimeter so that people can buy on impulse and that sort of thing. And so I think some of that is part of it. I think the other thing is that there are opportunities for the space-to-sales ratios to be adjusted, to be changed, and as we demonstrate that we are growing the category, and that we can sell more quickly, and that we support with our DSD with our IO model, we'll gain more space that way. So I don't necessarily think the category needs to grow space in the traditional sense of the word, but I think the category will continue to gain more space in the geography based on its contribution to the total sales. That's good. I apologize in advance of this next question. I'm sure everyone's eyes are gonna collectively roll when I ask it, but have you seen any measurable impact from GLP-1 drugs on your business? And how are you guys try to size up their or even think about that as a risk moving forward? Yeah. So, the short answer is, it's in my opinion, the world according to Howard, it's still too early to tell. But we're very early in the cycle. There's not a lot of people using it, although there are plenty of consumers, and much ink has been written about it, both in the press and in the analyst community, and appropriately so. For us, I would tell you, there are a couple things. One, our growth story does has is not going to be impacted, particularly by GLP-1, because our growth story is more about expanding our geographies and holding our core, and being able to penetrate classes of trade more effectively. So if we do those things correctly, regardless of what GLP-1 does, I think we like our chances to grow the category plus a little. More importantly, you know, I'm a, I'm a consumer packaged goods brand kinda guy, and people who've done what I do, pay attention to what consumers are doing, and they adjust accordingly. So, my job, what if GLP-1 meaningfully impacts the category or not, I don't know. What I know is that the consumer behavior will change, and my job is to change with it. And so if it means more substantial snacking or presence of positives, or whatever it is, smaller pack sizes, if we have to adjust, we'll adjust, and we'll continue on doing what we're doing. And then the last thing I'll tell you is I'm reading everything that all of everyone else is reading about it. We're gonna watch the data. We're not gonna overreact, but I think it's very, very early, and we have a whole lot of other things to do as well. Great. That's helpful. You mentioned this a little bit earlier, but I think it's worth diving in a little bit deeper. You know, you guys utilize this unique network of independent DSD operators. Do you think your IOs give you an advantage when going after new business? I'll take that. The answer is yes. We have been converting our routes from employee-run to independent operators over the last, you know, several years. I think we are substantially done, in the next three to four weeks, 25 more to go. And this independent operator network is now individual business folks who are motivated to drive their own business and grow their top line, grow their profitability, et cetera. That motivation, compared to motivating an employee, gives us a leg up. On top of that, you know, these IOs, they hold us accountable as much as we hold them accountable. So we, as a company, need to grow the business so they can grow theirs. We need to give them the right products, the right brands, the right packages, at the right price points to go out and sell. As an example, so I'll give you two examples on those two. During COVID, we benefited from having independent operators because we did not have to tell them to go out and continue doing business. Second example would be, as inflation started to hit, and we needed to take price, the IOs were as motivated as us to execute pricing actions on the shelf because higher price means they get a higher ring to cover their own inflation in their business. So I think those are a couple of examples. From a P&L standpoint, we also see this as a sort of an intangible benefit of having less of an employee base, and therefore, less risk in the business. If you think about the IO, they are our largest customer. And you know, they are people who care very much about their business, just like every traditional retailer. Do you feel that they give you kind of more bang for your buck in terms of, you know, on-shelf blocking and facing, and, and having kind of the in-store presentation be much more kind of put together relative to maybe some of your peers? Yeah, I mean, yes. I think, I think that that's, I think that's fair. A lot of us, a lot of our competitors, obviously, everybody's in DSD in this, in this segment. I'm pretty sure that one of our competitors would probably take umbrage to the idea. But, but look, I think that our IOs care very take pride in their business, and that pride shows up on the shelf. Okay, that's helpful. Does a tight labor market impact the availability of, you know, these IOs or labor for them, and being able to, you know, hire people for their business? I think it's quite the opposite. So if you are in a tight labor market, retention and recruitment of employees gets harder. But an independent operator network, where on average, an IO owns one, maybe two routes, you know, does not require them to rely on that labor pool to run their business. Most of the times, they are running that business with one or two helpers, who are probably family members or friends, that, you know, don't play in the same labor market rules as normally everybody else does. That's helpful. I know, Howard, you said that Ajay's Christmas present to you is that we're going to stop talking about SKU rationalization, so- Sure. Since we are before Christmas, I will allow myself to ask you a question on it. Yep. Can you just give us kind of a, you know, one maybe final update on where you're at with that? And since we're talking about the IOs, how that impacts, you know, partner brands on the trucks and kind of, you know, better utilizing the space on the trucks going to stores. Yeah, and of course, the funny thing in that joke is neither Ajay nor I celebrate the holiday. So, look, I think that we've been talking about SKU rationalization now, I guess, going on what? Two years. Yep. You know, assortment management will always be part of any consumer packaged goods company, but we will get to the end of that hard scrub, as Ajay likes to call it, by the end of the year, and then we will blissfully never discuss SKU rationalization again, unless we were to wind up in a situation where, through an acquisition, we had a lot of business we had to move. But look, when you do the assortment management, what it did for us is it does. It is an unlock for portfolio optimization opportunities, getting the right items on the right shelf. It's also an opportunity for us to in-source more of our product, which should improve our margins over time as we are capturing our own fixed overhead, outsource the complexity, but keep the manufacturing in our own boxes. And then, you know, with respect to partner brands, this industry always is going to have folks pulling other people's products, right? And that, because how you build the route infrastructure and get the route averages right will be there. But on the average, what we would like is to make sure that we are carrying all of the things we can, so that the business, our business grows it to its full potential, just like our competitors do, and then we'll partner where we need to, to make sure that everybody gets the route averages they need and manage the routes the way they need to be run. Ajay, if you can, maybe speak to kind of what you're seeing in the commodity basket right now, and maybe any insight you can offer us as we get closer to 2024? Yeah ... what commodity costs are looking like. Yeah, I think we are, we are still working through it and not, not ready to call what it looks like for 2024 yet. At this point in the year, we have visibility to how the contracts are unfolding, but we are only locked to about 30% of our portfolio that we, that we're going to use next year. What I can tell you is there are going to be puts and takes. Labor and transportation is going to be inflationary. There are going to be some commodities, such as the various oils that we use in our products. Those are going to be deflationary. Potatoes, we are going to see the high teen inflation that we are paying for right now into Q1, because the contracts run from spring to spring. And then, you know, we are still working through the contract for the rest of the year. So when you put it all together, don't know what that total basket looks like, but we'll know more by the time we are ready to guide for next year. That's helpful. Maybe another question on, Mm ... the balance sheet. You know, with interest rates potentially being positioned kind of higher for longer, can you just remind us what your debt structure looks like, any large maturities we should be aware of, or when maturities you guys have come due, and then kind of what the fixed versus variable percentage of your debt structure? Sure, happy to. So in the third quarter, we printed net debt of about $875 million. And, the, the entire basket of debt that we have, term loan being the biggest one of that, is due 2028 or beyond. And so we have some time on that. And 70% of our total debt basket is, fixed through interest rate swaps at about 4.7%. So we feel good about that portion of the basket. That leaves the 30% that we still got to work through, you know, and, and work on net leverage as a result. And on top of that, we have pretty good liquidity, cash liquidity in the business. We have an ABL line, which is largely undrawn, and we have, at any given quarter, we have $150 million-$200 million in liquidity. That's great. And then maybe if we think about, you know, Howard, you talked about opportunities to cost savings across the supply chain. As you guys free up some incremental capital, I mean, should we think about that all kind of going to debt payment? Is there any, you know, other uses, innovation, support, maybe, you know, above up, just kind of capital allocation as you guys start to get that flywheel spinning and, you know, have more cash available? Yeah. So our capital allocation priorities are to pay for growth, and then work on the rest, you know, pay down debt and dividend and so forth. So we are holding true to that. Net leverage is incredibly important for us, but at the same time, doing the things that we are doing around network optimization, driving productivity, building scale in facilities like Kings Mountain manufacturing plant, and deploying CapEx there, as well as paying for growth. You know, those are incredibly important because that gets the flywheel going in terms of the rest of the business. That's right. I'll pause one more time and open up for questions before I finish this up. I know that paydown is kind of the main priority that I want you right now, but, given that you come to Post, can you talk about just what criteria is for M&A? How you kind of think about, you know, M&A in the future or whatever, but kind of takes a back seat? Yeah. So, I... A couple things. I think, one, historically, we have done three different types of acquisition, right? So we, we've either secured the supply chain that was sort of the R. R. W. Garcia, Festida acquisitions we did. We buy master distributors, and then we, we've been buying businesses like Truco that rounds out a subcat. I think as you go forward there, I would tell you, securing the supply chain is not something that we need to do. I think our supply chain looks great. We have the capacity we need for growth. We have the capacity that we need as we move forward. The route infrastructure will remain the same, excuse me, will remain the same, or has the same opportunity for us if we can buy master distributors. And then from a subcat perspective, really, you know, we, we mostly are where we need to be. I think popcorn is the notable asset that we, you know, have a, a real opportunity relative to the category. So, you know, I think we would look at complementary geographies, and I think we would look at complementary subcategories. We are. We tend to be very disciplined buyers. We tend to buy at relatively low multiples. We synergize very effectively, and there's no reason to believe we would do anything differently. Yeah, that's what I was noticing, was some of the deals, it was a 9x-11x for these companies. Yeah. Great model. Yep, for sure. Great. As we wrap things up, why don't we finish off with a couple of questions on innovation? Sure. You know, I know you guys have had a couple of successful launches recently. Mike's Hot Honey is one that I think you guys added to the portfolio longer term. Yep. Maybe just give us some color first on, you know, recent innovations that have gone well, and if you can touch on that one specifically, you know, what made you guys decide to add it to the portfolio, you know, longer term? Yeah, I mean, so obviously, probably the two most notable innovations that we've done in the last, you know, couple of years, is the Zapp's seasoned pretzel and Mike's Hot Honey, as well as actually its predecessor, which was a Grillo's pickle chip that we had also done. I think what makes all of those interesting is they tend to be incremental consumers. So in the Mike's Hot example, you take a consumer who is an Utz consumer and a Mike's Hot Honey consumer, they tend to be two different groups. One, a little bit more urban and youthful, and you can decide which one is which. And the other is sort of a more traditional household at this point, and you basically cross-pollinate them. So what was in it for Mike's was exposure to a totally different consumer set than we would have normally gotten. What was in it for Utz was exposure to a totally different consumer set. And when the consumer response was remarkable, the social media pickup was great, the dollar sales were great, the incrementality was great, and it was massively more successful than some of the things that we have done historically, which then told us that this is an item that we should offer into our repertoire every day. Why would you stop it? And it also hits on a couple of other trends: urban, spicy, and flavor, right? And so as you look at those things, it was a great launch, it was a great product, consumer expectation was wonderful, and so we've decided to continue it on. In the Zapp's example, you know, one of our competitors, you know, started out as an independent, opened up this entire area around seasoned and flavored pretzels, that there really was a nice job. And so what we did was we took the Zapp's item, Zapp's brand, and we put our own twist, pun intended, on the pretzel and brought in flavor that made sense for us. And so, as you look forward, both of those types of ideas are important to us as we move forward. So we know hot and spicy is a very quick-growing segment of all of American food, but certainly in salty is the fastest-growing segment behind a power brand that has something to offer and that can be incremental, and an item that is strategically or a portfolio item that is strategically important for us. So when you look at next year, it won't surprise you to see in a couple of our subcategories where we need to do some reinforcements. We've talked about the price ladder and kind of where we need to be in barrel-specific items. You know, we're going to bring out more things in flex. We're gonna try and make sure we're hitting the right price points, but flavorful, seasoned, and then in areas where we're growing in better-for-you, are gonna be the areas that we continue to focus on. Great. I think that's a good stopping point for us. Howard and Ajay, thank you very much for your time. Thanks. Thank you, everyone, for joining us.