Good morning, everyone. Thank you for making the trip to Austin and joining us here this morning at the 2023 Vital Farms Analyst Day. I'm gonna take care of this real quick. It's my pleasure to introduce our President and CEO, who will be leading our presentation today, Russell Diez-Canseco. Come on up, Russell. Thanks, Matt. Do we have... We don't have any canned applause, I guess. It was my entrance theme. Thank you. Thank you. So... Oh, cool. Thanks so much for being here today, making the trip, and to all of you who are tuning in remotely. This is an exciting day for us. It's, it's an opportunity for us to reflect on kind of the last three years since we became a public company, and to now look ahead and talk about what we have planned for the coming years. And, it was, it was actually really fun to reflect on where we've been because, it's been quite a ride. The world has thrown a lot at companies like us since 2020, and we've kind of persevered in what I think is a reasonably impressive way. We don't use the word "proud" at Vital Farms a whole lot. We wanna just kinda talk about what we did and let other people interpret whether that's a good thing or a bad thing. If I ever came close to using that word, it would be in reflecting on kinda how we've done over the last few years. I have a laser button here and a... That's one button. That went back. Yep. The one right in front of me. All right, what are we gonna talk about today? We're gonna refresh our memories on how what we've built can grow and travel. We've been growing. We've really been, I think, expanding on the promise of this company, when we introduced ourselves to you all back in 2020. We're gonna talk about a path to continue that growth and all the different paths to achieving our potential and the way that we'll pursue it, and I'll be doing very little of the talking today. First of all, we've built a strong brand, and that's really kinda at the heart of what we do. We have really disrupted the way that food is produced in this country, starting with eggs. The idea that Matt O'Hayer had back in 2007 was, "Let's get those birds out of their cages and give them an environment in which they can express their natural behaviors." At that time, 95% of the laying hens in this country were in cages, and today that number is south of 70%, approaching 60%. I'd say that's a lot of impressive progress in just a few short years. We're in over 10 million households. We're in over 24,000 retailers, and we've got an incredible farm network of over 300 family farms, and we've built our own egg packing center called Egg Central Station, and we've doubled its capacity in just a few short years. Green button. This was actually an eye-opener for us. We don't spend a lot of time looking backwards. We generally are focused forward. We went out and we pulled out the projections we gave our underwriting analysts when we went public. This is what we said we'd do. We said that we would do $199 million in revenue in 2020, and we projected this year, getting all the way to $394 million in revenue. As you might recall, there have been a few curve balls along the way. There was work from home. There was returning to the office. There was supply chain disruption in the world. There was inflation, input cost inflation. There was the need to take price, and maybe retailers would accept it, maybe they wouldn't. Then there was a need to see if consumers would pay that price. And through all of those pivots along the way, we over-delivered. We delivered on these commitments, starting with revenue. We delivered on gross profit commitments despite those inflationary pressures, again, comparing what we projected at the IPO and what we actually delivered. You can see how that word "proud" might have come to mind a couple of times. And despite all that macro noise, we actually delivered profit. Maybe not exactly as much as we thought year by year, but in aggregate, largely in line with where we thought we'd be. And I think, I think that's a pretty remarkable track record, certainly given the macro environment. And we did it all without burning a bunch of cash. We have nearly as much cash on the balance sheet as we did at the IPO, as we raised. We have done a fair bit of CapEx along the way to expand primarily our egg packing center, to grow our capacity from about $300 million in revenue to now over $700 million in revenue, and we didn't have to raise any money to do it. So with that in mind, that we are intentional, that we deliver on our commitments, that we don't tend to make promises we can't keep, here's the next phase of the plan: to reach $1 billion in net revenue from our existing businesses by 2027. And you'll hear from this amazing team that I've brought with me about how we're gonna do that. But at a high level, what it will require is another 20 million households, 8,000 new stores, adding items with existing retailers. We're gonna need some more farms, but actually not as many more as we currently have. have. To get to $1 billion, we will need more processing capacity, and we'll talk about how we get that. So our plan is to be at least $1 billion in net revenue from existing businesses by the end of 2027, with a 35% gross margin and 12%-14% adjusted EBITDA margin. We get questions, not infrequently, about what the next thing is gonna be. And that continues to be a body of work that we do. We have some clear criteria which we've talked about in the past. It's got to be disruptive, it's got to be aligned with our purpose, and it's got to be enable us to deliver quality at scale, which were the ingredients that got us to our fast-growing and increasingly dominant position in branded eggs. The question I often get is timing and maybe what it's gonna be. The thing I would say, like so many other things that we do around here, is we're not in a hurry. We're not gonna do something that doesn't make economic sense and doesn't deliver on these requirements. The reality is that a big thing changed in the last 2 years, which is that capital went from being largely free to something north of that. That means that some of the math that might go into some of the analysis we do on potential opportunities has changed appropriately. So it's not about whether or not we'll do something else, it's largely about when. And I think, again, when we have news to share, we will, but the reality is with kind of interest rates where they are today, I think a lot of companies have reconsidered the, the pace of investment and what their threshold is for success, and, and we'd be silly not to do that ourselves. So with that, I'm gonna introduce Kathryn McKeon, our Chief Marketing Officer, to start sharing the real meat behind, these big aspirations that we've just put out in front of you. Thank you. Thank you, Russell. Good morning, everyone. Great to see you. Thank you for being here in Austin and for those on the phone as well. The Vital Farms brand has a really strong foundation. It's a foundation that we've built since day one. The next opportunity for us is to unleash the power of this brand, and that's what I want to talk about today. We're gonna do that by building awareness and gaining those 20 million households you heard Russell talk about. We have, since truly day one, when Matt O'Hayer founded this company, been absolutely rooted in and had conviction for a commitment to and a belief in improving the food system, in disrupting it, and in our ability to do that. And it's all about our purpose: improve the lives of people, animals, and the planet through food. That's a real thing. That's a thing that we have stayed absolutely committed to, absolutely focused on, and built this brand in all the components that make that come to life. That means that we resonate with consumers. That means that through transparency, we've built trust. We have consistently delivered on our purpose and been rooted in our core beliefs for all these years. It's made a really strong brand that works with consumers. The opportunity is to drive awareness. We're gonna talk about how many consumers there are and what that potential really looks like. And we're always gonna do it in our own unique way. That's about disruption and about showing up, living our purpose every day. We all know that consumer trends are evolving and changing over time, and we're watching that, right? Where are the consumer trends right now? They are holistically moving toward a care for where your food comes from, a really big desire to know where your food comes from, a need for higher animal welfare standards, and a commitment to individual health, what that means for each individual. It turns out that when Matt started this company in 2007, he wasn't thinking about these things. In particular, he was thinking about his purpose. But in doing his purpose and improving the lives of people, animal, and planet through food, we were ahead of these trends, and now we get to be a part of these trends. And everything that we've always stood for and everything that we're committed to puts us perfectly on these macro trends. These macro trends are actually so big that they're showing up in legislation now. There are 10 states that have banned caged eggs, so cage-free becomes the minimum. There's more coming, and we anticipate that this is gonna keep moving in this direction. You're seeing such an influence of consumer demand and consumer preferences, that it's showing up in legislation. Those macro trends, this legislation, these are all things that tell us that our total addressable market is big and will continue to grow. Let's look at what that means in some specific numbers. 131 million total households buying eggs in the U.S., 131. Within those 131, 72 million households buying premium eggs. That's anything cage-free or a higher standard. How we think about that is any consumer buying cage-free or higher is signaling, "I'm willing to spend more for a higher standard," specifically an animal welfare standard. So that's a group of people spending for higher standards. Within that 72 million, there's a subset that we've defined as our target consumer, 34 million folks. Those are the people for whom we have identified will most resonate with the Vital Farms message, who are the most likely to convert from awareness to purchase. That's where we're focusing our marketing dollars. That's where we're gonna be most effective in the way that we spend our dollars. It's worth noting that that 34 million is 20 million more households than we talked about at our IPO. That's for two main reasons. One is those macro trends. There is a natural growth of this space. This is where consumers are going. The other is that we are better understanding these consumers. We've had several years to get to know them, to understand them. We're more sophisticated in the way that we do insights, and we've really got this group in a good place that we understand and that we can effectively use our dollars and convert people. Today, we have 10.5 million households as of the end of 2022, when we last reported. That number continues to grow, and we're feeling good about it. At the moment, 10.5 million, so we need to go get 20 million more, and we feel really good about the world that we're operating in and the possibility of that. That 10.5 million, I think it's worth looking back a little bit about how we got there. We've had a really nice, steady drumbeat, steady increase of households over all these years. And one way I think about it is we've almost doubled our households since our IPO. But a nice growth, a really intentional, thoughtful growth within that group that we've identified. Here's where things start to get pretty interesting. At least I certainly think so. As we've grown households by millions each year, in absolute terms, we've also grown share of wallet. So this means that we're adding households to the Vital Farms portfolio, while also having them buy more eggs with us. That's a pretty rare thing to grow both. It tells me as a marketer, that we're just in the early stages of the potential of this thing. And I'll also say, I've been doing this a few years now, working in CPG. You usually get to pick one. In fact, you have to pick one. Are you gonna grow households, or are you gonna grow loyalty? We're doing both. That's really unusual, and I really think we can keep that up. Here's another way of thinking about it that maybe takes us back to an individual consumer and helps paint the picture in a bit of a different way. 36% of Vital Farms shoppers say they will leave the store with no eggs if they can't find Vital Farms on the shelf. So if you think about that as an individual consumer, they're planning to bake a cake, they've got plans to make brunch. They're at the store. They've got Vital Farms on their grocery list. Vital Farms is not available. Maybe some other people beat them to it that day. They're gonna leave the store. So they're either just not making the cake or they're going to another store to buy Vital Farms. So 36% of our shoppers, that's a really notable way of thinking about the loyalty that we've built and the foundation that we've set with this brand. So if we zoom back out for a second and think about sort of what does that mean holistically, and how do we think about that in our business and what comes next? If we think about our conversion funnel, we have some of the best in the biz in terms of our ability to drive conversion. Once you're aware, to consideration, then to purchase, and ultimately to preference, or you could think of that as loyalty as well. All of the things we've done, our commitment to transparency that builds trust, the consistency over time that builds trust, a really, really big commitment to our purpose, and showing up throughout all the, all the touch points with all of our stakeholders, that's what's driving this. We're on trend. People are seeing what we do as a reflection of their values, and it matters. So as we strengthen that funnel, the opportunity becomes then to fill the funnel, to really focus on awareness. As of the end of last year, we were at 21% awareness. 21%, tons of upside there. So if you think of all the households that we looked at and that awareness, when we make them aware, we are driving them through that funnel and getting those households. So those marketing dollars, we've increased our marketing spend as we've shared year-over-year. We've been able to drive higher levels of awareness with that. We've really focused in on awareness to drive consumers through the funnel, and we're seeing that impact. We're driving to purchase and preference. You can see that simply in our growth numbers as well as the loyalty... and that's a big driver of our business, and we believe we continue to get sharper on how effectively we can use those marketing dollars. So how does it show up? How do we make people aware? We have a little bit of a different take on this than perhaps kind of a standard marketing approach. This starts way before we ever get to marketing, which is one of the coolest parts of my job, is that we really do the thing. This isn't just a story we're telling. This starts all the way back with really, really doing the work, the right products, the right relationships, the way we care for people, animals, and the planet through food. That is real, and so the work becomes to tell the story. We're really living our purpose throughout the organization. And that means that we get to have a campaign called Bullshit Free. We actually get to talk about ourselves as bullshit free. You don't get to do that and have a great campaign like that if you aren't, right? And so this commitment to who we are and how we operate gets us to a place where we get to be that. So how does that show up? Well, we get to do some campaigns like this campaign, Hens Behind the Lens. We won a Cannes Lion for this last year, a pretty big deal in the marketing awards space. This was a campaign where we rigged a camera and had chickens actually pecking at the camera so that they were the photographers. An entire campaign with beautiful photographs, all with our hens as the photographers. It's a really fun campaign. It's really playful. I think what's important here is you can't just do this campaign unless you have the relationships with the farmers. Really healthy birds who are happy to be outside in the pasture with people and interact and engage because we've taken such good care of them. So, yes, we're bringing creative ideas for how to bring this to consumers. It's possible because of the way that we operate. We also really know who we are, and that allows us to be agile. So we do what we say, we say what we do. That means that when opportunities arise, we get to jump in and be quite playful. So recently, the company formerly known as Twitter, took on a new name, and within 48 hours, we were in the San Francisco market, talking about how the Twitter bird gets to roam free the way that our birds do. Again, playful and fun, of the moment. We didn't have time. That was relevant right then, right now. But knowing who we are and being confident in that allows us to be in the moment. You'll also see quite a bit of what we do as very transparent in the way that we show up. So yes, on the side of every carton of eggs, there's the name of the farm those eggs came from, and you can see a three sixty video of that farm. That's a piece of transparency that shows up in every pack that every consumer buys, our traceability program. We also do things like an open letter from Russell, talking about what we believe, what we see going on in the marketplace. So we're bringing playfulness. We're also being really transparent, and we're able to do that because we do what we say, and we say what we do, and it really resonates with consumers, and it really, really reinforces our Bullshit Free approach. The other part of this is showing up where our consumers are. So, you know, I think a lot of brands think about educating consumers. We actually think about engaging consumers. Consumers want to engage with a brand in a meaningful way, and we want to show up for them in that way. It's not so important that we say every lesson or every fact. It's that they get to see what we're about, and they have the opportunity to see their values reflected in what we do. So that's showing up where they are. I'm gonna guess that a few months ago, like a lot of people in this room, our consumers were also watching Succession. I'm gonna guess most of you in this room were somewhere watching Succession. We were one of the first two brands to advertise on the Max platform during and it happened during Succession, alongside Mercedes-Benz. Mercedes and Vital Farms advertising on Max. A really good opportunity to continue to learn and push in the media landscape to show up where our consumers were. The other fun part is we didn't just run any old ad. We happened to have an ad that is rooted in the idea of corporate nonsense, and the specifically the corporate nonsense of companies making claims that are way in the future that they couldn't possibly ever keep, making promises they couldn't keep. And that Vital Farms is Bullshit Free because we do things a little bit differently than that, a lot differently than that. We thought no better place to run an ad about corporate nonsense than in a show that is entirely about corporate nonsense. So just a chance to bring some playfulness and put a little juxtaposition, a different way of thinking about, you know, we disrupt the food system. We like to be a little disruptive in the way that we show up to things, too, and we got some great, great response to that placement and running there. One last little piece in the way that we show up for consumers, something that we have been working on for years now and really take really seriously. We have an entire team of people who works at Vital Farms in-house, who is engaging with consumers across all platforms: email, social, DMs, text messages. We even still get some snail mail, certainly some phone calls. This team, they're not just responding, they're not just making sure questions are answered. This is a team of people that, like all of us, really takes what we do really seriously and really cares about our purpose. Honestly, we really appreciate and have so much gratitude for consumers buying our products, and we take that really seriously, that we show up for them, too, throughout. Not only do we answer the questions, and we make sure people have what they need, we do that in almost real time across all platforms, but we actually go a step beyond. Here's an example where a consumer posted a story that they broke their eggs. Just fell off the counter. It happens. We didn't just look at that or just write a message. We actually DM'd them, and we sent them not only just eggs, we sent them a bunch of eggs and some butter, too. We built a stan, as the kids say, through that. That's what the consumer actually wrote. This is something... We're going above and beyond to take care of our consumers. Yes, it builds consumers who are loyal for a lifetime. They—not even just that, they become brand ambassadors, because we went above and beyond and because we demonstrated how much we cared. And this is a really important part of really seeing this through with our consumers and reflecting back to them how much we appreciate them. So how does it all show up? What does it mean, ultimately, all of this storytelling and making sure that we leverage our foundations and build awareness? Well, over the last few years, we've maintained a price premium, not just to conventional, but even to our premium peer set, and we've continued to grow our share over time. Consumers are coming to us, they're coming back to us, they're trying us, and they're returning because they believe in the brand, because we have shown them that we have real purpose, and that aligns with what they're looking for, and that we've been really consistent over time in improving the food system and showing up for them. We've built this disruptive brand. We've done it by living our purpose, really, and the next big opportunity is to grow awareness and unleash the power of this brand. I'm gonna turn it over to Pete Pappas, our Chief Sales Officer. Thank you, Kathryn. You're very welcome. Well, good morning, everybody. Thanks again for being here. My focus today really is going to be around distribution. And although many of us obviously are We work in this industry, and we spend a lot of time in grocery stores, how many of you have been frustrated when you walk into a store, and you can't find the product that you're looking for? I know I am, and particularly when it comes to Vital Farms, one of the biggest opportunities that we have is closing these distribution gaps. My biggest frustration when I talk with my team is our ability to get product on shelf, and then when I have product on shelf, making sure that I have the right the right assortment of products on shelf. The frustrating part for us right now is we're just not expanding as quickly as we believe we have a right to expand. What I'd like to talk with you about is two things. There are a lot of opportunities that we're tackling right now, but the focus right now is twofold. One is getting new stores or new points of distribution, and then when I have that distribution, expanding my assortment and getting my second, third, or fourth item on the shelf. Once I have those products in, ensuring that I have the right space on the shelf as well. When I dimensionalize what the opportunity really looks like, I'm very, very proud of the success that we've had to date. We've grown on a compounded rate at about 25% annually. We're in roughly 24,000 stores today. And that's nothing to be ashamed of. We're very, very excited about the opportunity. We're very proud of what we've been able to accomplish, but there's still a tremendous amount of opportunity available to us, roughly 8,000 more stores. So if you think about that universe, 25% of the universe still available to us just to get one item, that's just one single item, into distribution. Why is this important? I can't sell anything unless it's on the shelf, unless it's available to a retailer. So this opportunity is really focused just on two segments of business: traditional grocery and the natural segment. I'm not even talking about club, value, or ancillary opportunities. These are the two largest segments of business in which we operate today, grocery and natural. When you think about what's the size of the prize, 8,000 incremental stores that are still available to me to get one item in the store. Well, why is that important? My number one selling item is the number three selling item in the category. A retailer is missing huge opportunities. My 12-count conventional egg is the number three selling egg item in a grocery store. In the natural segment, I have the top four selling items in their store, when you take a look at the egg category: 12-pack, 12-count organic, 12-count conventional, 18-count organic, 18-count conventional. This is all lost opportunity for a retailer, which is what we're trying to explain to them, and obviously, lost opportunity for us. Now, once I get that product on shelf, the story is we're incredibly productive. What this slide is intended to do in a grocery account, so a relatively immature customer, our growth, an incremental additional item, is accretive. As Kathryn said, we don't cannibalize ourself typically. We are adding value and growing incrementally to every item that I place on the shelf. I'm adding users, I'm expanding users, and as Kathryn said, if Vital Farms is not on shelf, that shopper will leave the store. Another interesting item: Why is it important for me to be on shelf? Roughly 60% of consumers, as they go to an egg category, egg shelf, they're not sure which brand they're gonna buy. There's a lot of messiness in an egg set. That's a different story we can talk about at some time. We're working to clean that up, but the first order of business is making sure I have product on shelf. Now, as I look at relatively mature categories in the natural segment, where I have more than 1 or 2 items on shelf, I'm continuing to add value. I continue to be accretive. Our largest customer today has over 11 SKUs on the shelf. The number two retailer within the natural segment has now 8 items on the shelf. Every time they're adding an incremental item, I'm adding incremental revenue into the category. I'm satisfying the consumer demand for assortment, and we're adding incremental revenue and adding incremental margin to that retailer, which is the name of the game. Despite the time or the number of SKUs I have in store, I'm continually adding and I'm being accretive to the category, which is a great position for us to be in. That's the first order of business, making sure I can just get product on shelf. The other piece that's really important with this is, the way we have approached this is we've really—natural has been the tip of the spear. That's the way we started this business 15 years ago, with the largest retailer in that segment, based here in Austin. They've been a fantastic partner of ours. As they have grown, so has our performance across traditional grocery as well. This really is the barometer of success that we can continue to leverage and continue to share as we look at the opportunities in traditional grocery. So I've spoken about just what the sheer volume opportunity or sheer distribution opportunity of number of stores would look like. As I now look at incremental SKU availability on store, in stores, there are a couple things that we want to talk about. One, the food channel drives the most significant opportunity. We're gonna get into that. As I mentioned to you before, on average, my number one selling item is still in less than 80% of grocery stores, so I've got a significant amount of upside. My number two and number three items are in less than 50% of stores. Again, you think about the dimensionalize the number of grocery stores in this country, the kind of accretive volume that I can deliver, there's a tremendous amount of opportunity just closing white space. As I close those white space opportunities in grocery and in natural, it lends itself to more opportunity in the ancillary segments of or categories and segments of retail. So mass merchants, think Walmart, Target, BJ's. And then I still have opportunity to expand my distribution in the natural segment. Yes, I've got the top four selling items, but number one and number two are at about 80 to 85% ACV distribution. Numbers three and number four are less than 50%. So we're experiencing tremendous amount of dollar and unit growth in the natural segment. I still have more room to grow. I have not nearly tapped out what that opportunity looks like. So the opportunity for us, first and foremost, is closing white space. That is the focus of my team right now. We continue to leverage and pressure. We're becoming the smartest category partner within the space. Retailers are listening to us. I anticipate us to continue to make progress over the next 24-36 months. Okay, what's that look like? Expanding, the food channel is our biggest opportunity, as I mentioned. When you just take a look at the premium egg category by dollars, largest is food. 61% of the dollars are spent in the food segment, roughly 28% or so in the natural segment, and then the remainder in the mass segment. Now, obviously, the world's largest retailer plays in the mass segment. There's still a significant amount of opportunity for us there, but our focus really right now is in food. Why is that? Because my dollars, I'm only seeing 53% of my dollars coming out of food. So I'm under-spaced, I'm under-leveraged, and that opportunity is where really we are focusing our efforts. That value. If you just do the hard math, if I can close that gap, it's roughly $115 million in incremental upside. $115 million, that's, you know, more than, it's about 15% of what my overall revenue is today. So huge opportunity. Again, this isn't. It's not rocket science by any stretch of the imagination, and it's not easy at the same time, but this is very, very close and low-hanging fruit that we absolutely need to capture.... And the opportunity, as we talked about, is still extremely sizable. You know, if I can expand my TDPs, you can see we've experienced nice growth over the last three years, steadily climbing our average distribution in the black dot, roughly 2.5 items per store at 193 TDPs. You can do that math. It's roughly about 85% ACV. This is what we think the potential opportunity really sits. If I can just get about half of what I have in a Whole Foods store, in a traditional grocery store, I don't think that's an unrealistic expectation, given the productivity of the items, given the revenue that it generates, and given the margin that it generates for a retailer, given the compression that they're experiencing. This is a, this is a very realistic aspiration for us and something that we're, we're really, really laser-focused on moving forward. As I mentioned, the focus for us is still across our top three selling items. There's not one item that I would tell you is under-delivering. They're all under-delivering, in my mind. We have opportunity across the entire portfolio. In the mass segment, really, our focus thus far has really been on those two largest retailers in that segment, Walmart, Target. Interestingly, with our partners down in Bentonville, you know, we only have— we're only in about 40% of stores, if you think about that, and I'm the number two selling item by dollars behind Eggland's Best, and they have about an 85% distribution base. So I'm in half the number of stores that my largest competitor is in, yet I'm the number two selling branded item. We have tremendous resonance across consumers. A lot of people would say, "Well, your brand doesn't necessarily fit within the Walmart demographic." I disagree entirely. Our brand resonates across all consumer bases, and if you think about what that means relative to the value segment of business, segments that we're not even playing in today, Aldi, Lidl, Dollar General, a tremendous amount of opportunity that presents itself for us. But again, we're focused on things that are close in right now and ensuring that the largest segments of business we've optimized before we start to deviate, and start to distract ourselves in other segments of business. At Target, we're the number one selling branded egg item. So there's realistic potential. We're not making stuff up. This is all based in fact, based on data. When we have partners that partner with us, we are delivering against those results, and we're delivering against their expectations from a category performance perspective. Why is this important? If you think about it, retailers are not adding more space. Cold space is finite. Retailers are constantly realigning and remerchandising their stores, but they're not adding cold space. It's too expensive. So how do I ensure that I optimize that cold space on behalf of the retailer? Part of that is leveraging our portfolio. There's a whole strategy that we have in place to optimize space, which we can get to, into at a different time. But the first order of business is making sure that I have product on shelf. And then in natural, which is my most mature business segment of business, there's still opportunity. You know, we get clouded when you think about natural with the two largest retailers, but that industry or that channel of business is really made up by regional, super regional, and independent customers. So yes, I feel great about what we've accomplished at Whole Foods. I feel great with what we've accomplished at Sprouts. But there is a world of opportunity when you take a look at those retailers that sit below those two retailers, and that's our focus right now. We're investing in resources to close those gaps. Oftentimes it's a onesie, twosie type of sales opportunity because there are a lot of independent operators. But that is a huge opportunity because some of those retailers generate velocities that are comparable to the two largest players within the space. So we're not deceiving ourselves just because an operator has one or two outlets. They're all important to us, and we intend to close those gaps. And then lastly, you know, our TDPs per channel, when you think about what the size of the opportunity is in productivity, again, this is another indicator of why grocery or food stores are so important. You can see the productivity per TDP across each segment. So again, our focus is in grocery. That is the largest opportunity that we have. That is where we intend to continue to focus our efforts. We have a tremendous amount of momentum across the top three or four traditional grocery retailers, but there still is a huge amount of that universe where we don't even sell eggs. We're not available on the shelf. That is, I can, I can get pretty dramatic when I talk about this stuff, but it's really upsetting because it is, it's just lost opportunity for us, it's lost opportunity for a retailer, and that's a tremendous area of focus for us as we close these gaps. And you can see why, because it generates more incremental revenue than any other player within the space. So, listen, I think, I sped through this, but hopefully, you get the message. We have an amazing amount, and I think, you know, using rough numbers, $300 million-$400 million of upside in front of us just by doing the things that we want to do, closing our distribution in white space and ensuring I have my top three or four items on every shelf within food stores as well as in the natural segment moving forward. If we can do those things, then I think we can really start to get excited about looking at other channels of business and starting to fill out the portfolio, as we look at some of these other areas of opportunity. But, the exciting thing again is that we've proven a model with those retailers that partner with us, and we have a proven success story that we're now starting to translate with other retailers, and that traction is starting to build. Very excited about what you'll see in 2024 and 2025 and beyond. And, appreciate again you being here and appreciate your time. So I think we're gonna break now for 15 minutes. Restrooms are over here to the left. We still have coffee and breakfast out, and then, we'll be back up at the end of the day to take questions from you, at that time. Thanks again for your time. Great! Well, welcome back, everybody. My name is Jason Dale. I have the privilege of serving as Vital Farms' Chief Operating Officer. I'm gonna talk today a little bit about our differentiated supply chain and our resilient operating model that we use here at Vital Farms. I truly believe that the way that we operate has a lot to do with why we've been able to deliver the amazing results that we've had in the business, and more importantly, set us up with a really great foundation about what we're gonna do in the future and everything we're talking about for our plan ahead today. I think at the heart of this, it really goes back to our values-driven collaboration that we have with our farmers and with our suppliers, and our amazing crew members that work in this part of the business and support these key stakeholders. If it's the amount of time and attention that we spend with farmers after we get them to sign an agreement with us and shepherding them through the process before they even get birds. So that whole process can look like an 8- to 10-month process, and we could treat it as a transaction and have them sign a piece of paper and then say, "Hey, we'll see you when you get birds." But we actually stay really close to that process and shepherd them through working with a financial partner, how they're gonna set up their barn, how they're gonna manage the process, and what to expect once they get birds. Or a supply chain team that's really honed in on building great relationships with our supplier partners, and again, more than just a transactional relationship. They're really getting to know the companies. We tend to really resonate with other values-driven suppliers, and that wanna learn our business, and also give us the opportunity to learn their business, how we can make better decisions together. I don't think that it was by mistake that during COVID, we certainly had an opportunity where we were putting every single egg that we were pulling off the farm into a box and distributing it out into the retail environment. That had a large part to do with a lot of other egg companies in the industry couldn't actually get eggs on the shelf. We were able to do that clearly by having these kind of quality relationships with suppliers, that we're able to plan and support and pivot in the moment to support that unexpected growth that we had in the moment. I think this foundation really sets us up well and makes me confident about adding additional farms, additional supplier capabilities in the future, to support the growth plan that we're talking about today. Our farm network certainly has been growing over the years to meet our robust demand. I think the makeup of our farms today certainly looks different than it did in 2015 and 2016. Typically, the barn size or the flock size back then was much smaller, around 3,500 birds on a farm. Today, that number is closer to 20,000. The new contracts that we're writing are in that range of 20,000 birds per barn. Some of our farmers will have multiple houses on a farm. I think we've been very mindful about adding supply in a year, not only to service our current demand that we're looking at, but also looking a year or two down the road about what we believe we're gonna need to support our growth. I think we've done that in a very measured manner, the entire time that I've been here. I think the one year that stands out as a difference, certainly COVID. Russell talked about macro disruptions. COVID was certainly a large one for us, and as I mentioned, we got a lot of demand in that timeframe, and there was a little bit of a question mark, and us still really trying to dig in and figure out what would we be able to retain out of that. We did lean forward a little bit in 2021 and grow, bring a little bit more farms on than we had historically done year by year, but it really served us well. We were able not only to service the growth that we had there, but it gave us some runway in the future years to be able to support that and not be so aggressive in adding new farms for the years out. I think this profile gives me lots of confidence, as I'll talk about the 250 new barns that we need to add, in a couple of slides. I think how we work with our farmers, again, is another shining star for what we do. This is something that really sets us apart, in our industry, and it all starts with farmer selection. So we're looking for, owner values aligned, owner-operators. They're doing some type of agriculture work, so they either have an existing farm, they're trying to monetize a portion of the property that they otherwise wouldn't monetize. So think about a dairy farmer or a cattle farmer who has woodland edge property with enough acreage to put one of our barns on. It's a great opportunity for them to actually maximize the value of the farm. So that's the type of person that we're looking for, and certainly from a values-aligned perspective of being able to buy into the entire program that we're running. I think a lot of this happens with word of mouth. We solicit a lot of referrals from our existing communities that we're in, but also from different financial partners, feed mill partners, and things like that in the communities and where we operate. We are trying to diversify geographically and not get so dense in areas that we exist today, and we're starting to do some light marketing and some outward reaching and trying to drum up and attract interest in those areas where we don't necessarily exist today. This team really stays tied in and stays close to the financing partners that help really the farmer put together the investment of what they need to do when they get involved in our program. The economics that come with this agreement that the farmer is signing have, you know, they're reasonable length. Three flocks is what the initial contract is for, with flock res, renewals that come after that. It's important to point out that this is really about optionality. Our intent is that we're trying to build long-term relationship, and this farmer is signing up for an initial agreement, but the intent is that this will be renewed in the years to come. Again, if it's working really well, both for the farmer and for us. But this also gives us optionality if it isn't working for either party, that we actually have some options to deal with that in the years down the road. If they feel like they can monetize this portion of the land differently, this gives them an option for us to have a discussion about that, and that they could actually go do something else and vice versa. If it's not really working in the way that we intended it to, and we're not getting what we wanted out of the relationship, it gives us the option to move on to something else. Predictable pricing and clear expectations, I think are really important. We completely define, based on the breeds of the birds that are on the farms, about how many eggs they should be getting, what size the eggs are. And we line that out in an agreement to give them some sort of understanding of what they can target in terms of income that's gonna come off of the farm. And then we have a team, which is the farm support team, which their whole job is really more like an operating support system and less about compliance, and really helping the farmer achieve those expectations. Every single one of our new farmers attends what we call Egg School. I think this is another thing that really differentiates us in the industry. This typically is an immersive one-day course, and it's typically happening about a month before the farmer gets birds. So a farmer has already signed an agreement. They've already gone through the financing process. They've already contracted with a contractor, their barn's being built, but they haven't actually received their birds yet. They will go through this course, and they'll talk about everything from traceability to all the accounting and administrative stuff they need to do to make sure they get paid correctly. It's interesting to point out here that from a traceability perspective, not only is this important from a food safety and a regulatory standpoint, but this goes back to something Kathryn said. It's extremely important for our consumer. We put the farm name on the edge of our cartons. It's, it's, it's important for them to understand where their food came from. In this environment, before they even get birds, we can talk about what is this relationship gonna look like for you to interact with us when you get into operations? Doing this in front, we can get conversations out on the table and make sure that they're comfortable with and understand that, "Hey, we're gonna need to come to the farm. We're gonna need to shoot video." And all these things exist in the agreement that they sign, but this is just another way of bringing it to a level of sitting around a table, having a conversation, and really make sure they know what to expect before they get into the real work that is actually raising birds on one of our farms. So our farm support team, I talked a little bit about them. This is... You know, their whole drive here is really to be a network and a support system for the farmer. This is certainly from an accountability perspective, they're holding the farmers accountable to what our expectation is. We want for two reasons, we want them to be successful, certainly because this is a business investment that they're making in a part of their property, but it's also extremely important for us, with the long lead time to put down new farms, that we have a reliable supply that we can count on. And so this is a group of really knowledgeable people who either have some sort of poultry experience or other ag experience. They're constantly in contact with these farmers. They. Each one of them has about 30 farms that they manage, and they're constantly talking to them on the phone, weekly, making touch points, monthly visits, if not more than once a month, incremental visits if needed, if something is not actually working the right way on the farm. And then they're talking about real stuff, so weekly production analysis. They have all these tablets that basically, we have all of the data that's on the farm, so the lay rate of what the bird is laying, the health of the bird, the nutrition, the conversion ratio of how they're converting feed into an egg, and they're having those type of conversations with a farmer about, "Hey, you're falling short here," or, "What could we do different to support a nutrition makeup to try to deal with something that's happening with the output of the bird?" From a getting together and gatherings perspective of this group, historically, we used to have two really large group meetings a year, and one of them would look more like a mini trade show type thing, where we'd bring experts in, we'd have the farmers in, we'd do a little talking. We'd have lots of industry people, so think barn builders, equipment suppliers, the hatcheries who do the chicks, the people who rear the birds up until they get to week 16 and 17 before they come on to one of our lay farms. And these people would get to have communication with all of these different providers in that environment. When we were smaller, that paid tons of dividends, lots of cross-pollination with different ideas within the farmers. But what we started hearing from farmers is, "Hey, we want a little bit more intimate environment in our different regions to actually get into discussing what's happening on the farm in terms of business specific things." So trends that they're seeing in regions, whether or not it has to do with production or health challenges. Another thing that we saw when feed prices just went crazy and we saw lots of volatility in the market, this was a really big drive for the farmers of trying to understand how we managed, from just a mathematical standpoint, of converting what they were recognizing in feed to the egg price that we were actually paying them. So we had some education sessions with small groups and taking them through how the mechanics of that worked. And again, we heard lots of really great feedback from that. From a communication standpoint, again, this farm team is in constant communication. These quarterly newsletters and annual calendars are more a support system to let them know what's going on across broader in the organization. Some things they need to be organized in from a calendar perspective of when they're gonna get certifications, what type of paperwork needs to be done when. And so again, all in a system of really trying to set them up for success and be really organized as they're doing the real work, which is running the farm. Onion Creek Farm is a farm we have in Missouri. It's a company-run farm. It's a leased farm, so one of our farmers, who has two other houses, allowed us to be involved in the process of... It was greenfield when we started. We were involved in building the barn, selecting the equipment that went in the barn, and two of our farm support people run this farm. That was several years ago that we started it. The whole goal here was to really prove out if we operate one of our farms in the way that all of our paperwork says that we should, that we'd be able to achieve the outcomes that we have lined out in our agreements. And we were able to do that, and we were able to take big buckets of best practices and share not only with our team to make them more knowledgeable as they're interacting with the entire farmer population, but also with our farmers. And it gave us a little bit of credibility, too, because we were able to kind of point back to, "Hey, we're actually operating this farm ourselves." This farm has now turned more into an R&D environment... and it's allowing us to do things like testing different breeds, doing nutritional tests. It's a lot easier to do that in this type of environment that we control, as opposed to trying to partner with one of our farmers, that if something didn't actually go right, could actually hurt them in their pocketbook. This is a really great avenue for us to have to do that. I think you saw this in Russell's section, our focus over the next few years is adding 250 more family farms. I said this when I talked about what we've done in the past, I have lots of confidence here of doing this because of what we've been able to do in the past. I think we have an amazing team. We have a really great offering, and if you break this down over the next four years, this really says we need to be somewhere between 60 and 65 farms a year, and that's not far off the mark from what we've actually already been able to do. So this graphic is meant to bring to life the entire supply chain of what we have here at Vital Farms on the, on the egg side of the business. I've talked specifically a lot about the farms so far, but I wanna talk about the other two components here, which are really the cold storage opportunity of where the eggs go when they come off the farm, and then how they move into Egg Central Station. I think over the years, we've, you know, we've done a lot of work on getting more involved in vertical integration here with strategic partnerships. I think one specific one to call out, our cold storage partner, Cold Zone, who is in Springfield, Missouri, has been an integral partner with us over the last couple of years of really scaling that piece of what we do. If I look five years ago, the way we used to do this is, we'd have multiple cold storage locations, one relatively central, but we would use others as flex. The operation today that Cold Zone supports for us looks a lot more dedicated specifically to us. The area is specific, a building specifically for us in the underground in Springfield, and there's nothing else in there. There's no other products. There's no issue of cross-contamination. There's nothing we need to worry about there. On top of that, there's an operating team that runs that facility, that's dedicated 100% to us. Again, I talked about values-aligned companies. They are certainly a very values-aligned, driven company that understands our purpose, and their purpose aligns very well with what we do in supporting the lives of people, animals, and planet through food. And it's really been amazing because they've given us the opportunity to learn what's best-in-class and best practices in running a warehouse, which we've been able to translate into some operations that we do at ECS, and vice versa. They are learning from us on different things and ways to handle products like eggs. This operation is critical to us because all the product goes there and gets recorded from a food safety perspective. All the documentation that we have to do, it happens at that point. We feed data back from that system into our accounting system to pay our entire farmer network. So that partnership is extremely valuable to us. The transport from taking eggs off the farm to the cold storage and from cold storage to Egg Central Station is another area where we've really kinda upped our game. We've partnered with a company called Ruan Transport, which is a dedicated fleet opportunity. So prior to that, we used to use a somewhat dedicated group, but they weren't completely dedicated just to our business. They would do other things as well. This has really given us the opportunity to have more visibility around route planning, to have a more reliable system, and more recently, they started with taking the eggs off the farm and bringing them into cold storage, and more recently, they're now doing the rest of the supply chain and pulling that product into Egg Central Station as that facility calls for orders to be packed every week. We use a 3 PL partner after Egg Central Station that delivers our products to both our customers and distributors, and then it's distributed once again with those partners into actual retail formats, or restaurant partners. So we have plenty of runway at Egg Central Station. I think it wasn't long ago where we just finished the expansion here. Russell talked about us doubling our capability there. We have an amazing team. This team continues to grow and continues to learn. I think we are adamant about continuing to work on implementing a lean operating system in that building, which will continue to allow us to unlock additional capacity. I think this really sets us up for the path of what we're talking about, about supporting the future growth goals that we have for the company. So how do we think about the next facility? You know, it's really important to go back to the beginning and what we did before we even had Egg Central Station. We spent a fair amount of time coming up with a purpose statement on what did we want this facility to do? These things that are on this slide, food quality, safety, crew safety and collaboration, and impact, positive impact to the environment, are extremely important, and I would expect those to be important again. But the work that needs to be done to actually come up with a purpose statement may actually uncover that we need new capabilities today that we didn't when we previously did this work for the existing facility. And that work is actually happening with our entire leadership team, and it's happening next week when we're, when we're all together, at an in-person meeting. And we'll do that with a project manager who was heavily involved in the first build of the existing facility. Why is that important? Well, the work that will come out of this purpose statement will give us the ability to put a framework around a budget. You may think, "Oh, yeah, well, of course, you got to do a budget for any project." But this is more than just a budget on paper. This is something that gives us the capability to put guardrails and expectations around timing, around money spent, and really, the purpose of it is to remove any surprises or questions down the road. And I only have results to point back to, to say this works really well, because we built Egg Central Station and opened it in 2017 on budget and on time. We expanded the capabilities of Egg Central Station, and we were two-thirds of the way done, and all of a sudden, COVID hit. Well, we still finished that project on time with eggs in a box, exactly when we said we would, and on budget. So that amount of care and work that we put in the front end, I think, is really paramount to getting this right. And the other thing I'd call out is just the phasing of capital use. It likely will look like we'll do things over time to match the capacity need we'll need in the future. So it isn't like we'll shove a bunch of automation from day one, and then they'll let it sit there underutilized. What we'll try to do is do that like we did the other, the facility and the expansion, and add that automation as we need it over time. So I think before I hand it over to Thilo, you know, again, I think the key takeaways here are, you know, the collaboration that we have with our partners. That's at the root of this. Kathryn talked about this. I mean, the whole reason why we have the trust with our consumers is because we do what we say. We spend an inordinate amount of time on the supply chain and operating side of the business, and really crafting those amazing relationships to make sure we have the foundation to be able to deliver on those commitments. All of that energy and effort and investment that we've put in over the last handful of years makes me feel really good about that foundation that we have, that we can scale from that, use that to leverage and support the growth plan that we presented for you here today. With that, I'll turn it over to our Chief Financial Officer, Thilo. Thank you, Jason. Yeah, so my job is now to bring this all home and to finish out the morning. Let me quickly recap what we've heard so far, right? Russell kicked us off with talking about, since our IPO, we have done what we said we would do, actually slightly ahead of schedule on our financial targets, but we have built the track record that we deliver on our commitments. Kathryn took us through why we think we have a very unique consumer, how our understanding of our consumer has evolved, and how with that evolution of our consumer understanding, we actually have identified how we will go after the next 20 million households that we want to get into. That by now, we're in 10 million households, so we want to triple the number of households that we'll be in by 2027. And I think with the work that Kathryn and her team are doing, that's a very doable undertaking. Pete then took us through how are we going to get eggs to the consumer, right? We need to get them into retail stores. And he laid out where our brand, our products, where they deliver for the retailer, the scale that we have built with retailers, the reputation that we have built with retailers, and Jason just took us through where do these eggs actually come from, right? It's. At the end of the day, Vital Farms, if you ask me, it's a simple story, right? We're selling primarily in one category. We're selling in one country. We have one facility right now. The devil is in the detail in this business, and I think Jason did a very nice job just now explaining how thoughtfulness and intentionality helps us to make sure that we get those details right day in and day out. So this story now, it translates into these new financial targets that we set for ourselves. We are in just at the beginning of year four since the IPO, and so we figured it was time to give you new objectives that we set for ourselves for four years from now. That is $1 billion in net sales, that is, 35% gross margin, and it's 12%-14% EBITDA margin. The billion dollars in sales, as you know, we have guidance right now for this year of net revenue of $465 million or above. This is more than doubling the business over the next four years. Our gross margin is roughly at this level already. H1 of this year, we were at 35% plus. EBITDA margin, compared to the H1 of this year, it's 80-280 basis point improvement in our EBITDA margin. We'll get there by, you know, what Kathryn and Peter talked about, and we'll drive consumer adoption. As Kathryn laid out, we have identified the consumers that we want to go after. We have identified how we will go after them, and how we will drive first awareness, and then convert that awareness into consideration, into purchase, and finally into preference. Obviously, we need to have the distribution gains that Pete talked about. I think the numbers that Peter laid out about the number of stores to get into, and more importantly, the additional SKUs that we can get into existing stores, those will deliver this revenue number. As we are scaling the business, we will get some benefits from that, right? So far, EBITDA has improved somewhat. We'll keep improving it somewhat more. We'll get SG&A leverage, and we'll be very considerate and disciplined about how much of that do we let flow to the bottom line versus how much do we reinvest in the business. There's still capabilities that we want to build, that we have to build. There's still expansion in the spending that we want to put into marketing, for example, right? To drive the consumer awareness, we have to keep spending on marketing. Some of that, that scale benefit that we're getting will also flow to the bottom line. Lastly, we'll focus on cash flow. I think we are one of the few companies from this consumer-centric or consumer-focused IPO cohort in 2020, that has actually turned the corner on free cash flow and operating cash flow, and we'll continue to build on that. There will be spending for this new facility that Jason talked about, for example, but we have meaningful amount of cash on the balance sheet. With the revenue growth and the EBITDA margin that we are—that we have, there will be cash flow coming in to help us pay for that new facility. Let me just take you through a few additional data points. Bit of a reiteration, bit of, you know, bring a bit more life to the story. This is our revenue growth since 2015. We picked that date, that was the date that we had in our S-1, as the earliest data point that we have, so we went back to that. You see here that since 2015, we have a 35% CAGR in net sales growth. Since the IPO, we have had roughly 30% CAGR in our net sales growth. We're now guiding to 21% of net sales growth, right? Obviously, from a percentage perspective, it is a bit of a slowdown. If you think about the dollars that we're adding year after year, it's actually an acceleration to what we've had here, right? When Kathryn talked about how unique our consumer is in the sense that we are adding households while increasing the buy rate, right? We haven't picked the low-hanging fruit yet. We are still able to pick consumers that, over time, buy more of our products, rather than the consumer that buys us once and then doesn't buy us again. As we are still picking those low-hanging fruit, the dollar growth rate, or that incremental dollar that we'll be adding every year, that continues to go up. The revenue growth, I had talked about it before, it will depend on us getting into these 20 million new households that Catherine had talked about, getting into the 8,000 additional stores that we have identified as good market for premium eggs. Most importantly, getting additional SKUs on the shelf, because as Pete showed, we put an additional SKU on the shelf, it doesn't cannibalize anything that's in the store right now. It adds, right? It's more revenue for the retailer, it's more revenue for us. On the gross margin front, since 2015, we've grown gross margin from roughly 19% to 35%, first half this year. We've accomplished this despite a rather noisy macro environment, especially in the last few years. Pricing has certainly helped in the last few years, and it's been a very recurring source of questions or point of questions. But with the pricing has also come the realization how strong our consumer is, right? Kathryn showed the page that despite increasing price gaps, we keep growing share, and we grow share in a growing category. As prices went up across the category, demand for our products actually went up faster. And so our gross margin is already at the level that we are guiding to for 2027. So now the question for us is, how do we balance pricing versus reinvestment versus pay for farmers? And, you know, we take pride in following the stakeholder model, right? We take pride in the fact that we deal with our farmers, with our suppliers fairly. As their costs go up through commodity inflation, we make sure that we keep them whole. So that is where having this healthy gross margin right now will help us to have the flexibility in the future to maintain that kind of relationship with the farmers. We have this premium brand that Kathryn talked about that allows us to take pricing when necessary, but then also to be judicious about how do we think about promotions, how do we think about collaborating with retailers to make sure that our product is priced correctly. Going forward, we'll invest more in revenue management capabilities. That's something that we really haven't tapped into yet, when you think about where's revenue growth coming from for us, and where's growth margin coming from for us. So that's the capability that we'll be building over the next 12-18 months. And Jason had talked about our inbound supply, right? With now having a dedicated inbound, not inbound supply, sorry, inbound logistics. Having a dedicated inbound logistics provider who's dedicated to us, we have more control about our inbound distribution, and with that, we have more control over the cost that we incur for that. And lastly, at Egg Central Station, we're putting more and more automation into the plant. Jason talked about the new facility. We won't go all out on automation from day one. We wanna put it into the facility over time as capacity utilization increases, to make sure that we match the spending as much as possible with the volume that will go through the new facility. Okay, and then the last topic here, adjusted EBITDA. You see the numbers, they're a little bit bumpier, but our EBITDA margin has been improving first half of the year. We're already at 11.2% EBITDA margin. This is now the base that we will grow from, to 2027. I said our target is 12%-14%, so we are already within striking distance. And as I said before, the objective now is to balance letting scale benefits flow to the bottom line with reinvestment in the business. We expect that SG&A overall will grow slower than net revenue. That is the scale advantage that I talked about. We want to put more money into marketing to make sure that this consumer awareness that we need to increase in order to get the additional households, we need to make sure that we invest the money there, and that we invest in capability building and organizational growth. And the last topic I have here is free cash flow. This chart shows rolling 12 months or trailing 12 months of free cash flow, and you see here that once the investment in Egg Central Station was complete in 2022, our free cash flow actually did turn positive, right? So Q2 this year was the Q1 that we've had since the IPO, where we had rolling twelve months positive free cash flow. That is what we now want to build on in our future cash generation. And obviously, the revenue growth and the EBITDA margin expansion will help us with this, free cash flow focus that we have going forward. Let me finish this off with just quick reiteration of our guidance for this year. So we've talked so far about the 2027 guidance. We're not changing anything for this year. Guidance continues to stay at net revenue of at least $465 million for 2023, more than $35 million of EBITDA, and CapEx spending of $16 million-$21 million. So key takeaways, my last page. The last page you have to sit through for today. We're focused on getting new households and supplying those new households with distribution gains, both in terms of new stores and additional items in existing stores to drive revenue. We're focused on EBITDA margin expansion, and we're focused on free cash flow generation. That's the story for Vital Farms that we wanted to share today. Again, I think it's a simple story, where the devil is in the detail, and where the intentionality that we have as a leadership team, the thought that we put into the relationships that we have and the interactions that we have with all the stakeholders, that is what makes us succeed in this business. I think that is what makes us stand apart from other companies in our cohort. We'll end the webcast here, and we'll take a really quick break to set up for Q&A here in the room, and then it's your turn to grill us. Thank you.