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- **Volume Growth Outperforms**: 6% volume increase driven by North America and Asia, offsetting 7% price/mix decline. 
- **Cost Savings Accelerate**: $24M SG&A reduction in Q1, on track for $100M FY26 savings. 
- **New Products Launching**: Innovative offerings like Alexia garlic fries and PAW Patrol waffle fries. 
- **Argentina Plant Online**: New facility operational, 80% export-focused. 
- **Tariff Headwinds**: $25M annual cost from palm oil tariffs, now included in guidance. 
- **Cash Flow Strong**: $273M free cash flow in Q1, supporting shareholder returns.

**【CEO Summary Section】**
- Delivered Q1 FY26 results exceeding expectations, with strong volume growth driven by North America and Asia. 
- Launched 'Focus to Win' strategy, targeting $250M annual cost savings by FY28. 
- Restarted curtailed production line in North America to meet demand, with 80% of new Argentina plant output destined for export. 
- Launched innovative products like Alexia garlic & parmesan fries and PAW Patrol waffle fries. 
- Global fry volume growth outpaced total food growth since 2019, with 44% of global menus now offering fries.

**【CFO Financial Commentary】**
- Net sales flat YoY at $1.4B, with 6% volume growth offset by 7% price/mix decline. 
- Adjusted EBITDA flat YoY at $302M, driven by cost savings ($24M SG&A reduction) and lower manufacturing costs. 
- Strong cash flow: $352M from operations, $273M free cash flow. 
- FY26 guidance: Revenue $6.35-6.55B, EBITDA $1-1.2B. 
- Tariffs now included in guidance, expected to cost $25M annually. 
- Tax rate updated to 26-27%, up from prior 26% estimate.

**【Q&A Highlights】**
- **Production Line Restart**: Line restarted in Q2 to maintain fill rates, with minimal incremental cost. 
- **Price/Mix Trends**: Q1 price/mix decline of 7% expected to moderate in H2, with 75% of contracts priced at expectations. 
- **Gross Margin**: Q2 gross margin flat vs Q1, with seasonal step-up in Q3 and decline in Q4. 
- **Customer Wins**: 6% volume growth from new contracts, with 25% of FY26 contracts remaining to be finalized. 
- **Argentina Plant**: Operational but ramping up, with target utilization expected over time. 
- **Tariff Impact**: $25M annual impact from palm oil tariffs, potential relief if Indonesia tariffs lifted in March.

Lamb Weston Holdings, Inc. (LW) Q1 2026 Earnings Call Transcript

- **$250M Cost Savings Target**: Annualized savings by 2028, with $200M realized by 2027 to offset pricing headwinds.
- **Volume Growth**: 8% Q4 volume increase, 4% full year, driven by contract wins across all regions.
- **Focus to Win Strategy**: Prioritizing customer partnerships, operational excellence, and innovation (e.g., Fast Fries for non-traditional channels).
- **FY26 Outlook**: EBITDA $1B-$1.2B, net sales flat to +2% YoY, with stronger H2 driven by 53rd week and lower potato costs.
- **Leverage Management**: Targeting 3.5x-4x leverage, with $489M returned to shareholders in FY25.


**【CEO Summary Section】**
- **Strategic Reorientation**: CEO Mike Smith emphasized a new Focus to Win strategy, prioritizing customer-centric growth, operational excellence, and innovation. The company aims to reduce costs by $250 million annually by 2028 through zero-based budgeting and non-core asset divestments.
- **Market Momentum**: Fiscal 2025 ended with volume growth (8% Q4, 4% full year) driven by contract wins across channels and geographies. Adjusted EBITDA remained flat at $285 million despite pricing support for customers.
- **Innovation Focus**: Launch of Lamb Weston Fast Fries targeting non-traditional fry channels, and creation of global innovation hubs in North America and International markets.
- **Customer Alignment**: 60% of executive compensation now tied to free cash flow and returns, with Board compensation fully equity-based for 2026.

**【CFO Financial Commentary】**
- **Q4 2025 Results**: Net sales +4% YoY ($6.35B-$6.55B FY26 guidance), volume +8% from contract wins. Adjusted EBITDA flat at $285M due to pricing support (+$17M factory burden absorption, -5% price/mix).
- **Cost Savings Program**: $250M annualized savings by 2028, with $200M realized by 2027. 2/3 of 2026 savings (~$67M) will benefit gross profit, offsetting pricing headwinds.
- **Liquidity & Capital Allocation**: $1.24B liquidity, $489M returned to shareholders in FY25. FY26 CapEx $500M (75% maintenance/modernization, 25% environmental).
- **Potato Crop Outlook**: Lower North America costs in Q2 2026, Europe flat/slightly lower. FY26 EBITDA guidance $1B-$1.2B (excluding $40M SBC normalization).

**【Q&A Key Highlights】**
- **Margin Concerns**: CEO reaffirmed long-term margin expansion potential, citing attractive French fry category dynamics (85% QSR servings, 2pt higher attachment rates vs pre-pandemic).
- **Tariff Risk**: $25M FY26 EBITDA impact if August 2024 U.S. tariffs on EU goods materialize. Company mitigating through ingredient blending.
- **Customer Momentum**: 16% International volume growth (UK lapping voluntary withdrawal), 4% North America growth (regional retail wins). FY26 expects stronger H2 with 53rd week.
- **GLP-1 Impact**: No material impact on frozen fry category, 85% of servings in QSR channels where fries remain menu staple.
- **M&A Strategy**: Focused on potato industry, evaluating opportunities aligning with premium product strategy in key geographies.


Lamb Weston Holdings, Inc. (LW) Q2 2025 Earnings Conference Call Transcript

- **Revenue Resilience**: 4% net sales growth driven by 9% volume gain, despite macroeconomic headwinds.\n- **Cost Transformation**: On track for $55M+ FY2025 savings; 30+ projects underway to optimize operations.\n- **Customer Expansion**: Secured major QSR partnership and launched new private-label products, signaling share gains.\n- **Margin Challenges**: Gross margin expected to decline 700bps Q4 due to fixed cost absorption and input inflation.\n- **Tariff Mitigation**: 5% of inputs exempt from tariffs; minimal FY2025 financial impact anticipated.\n- **Strategic Focus**: Balancing short-term cost cuts with long-term innovation (e.g., fridge-friendly fries) to drive sustainable growth.\n

**【CEO Opening Remarks】**
- **Revenue Growth**: Q3 2025 net sales increased 4% YoY, driven by 9% volume growth, primarily from replacing lost ERP-related volume and new customer wins.\n- **Strategic Initiatives**: Launched 30+ cost-saving projects (e.g., logistics optimization, warehouse exits) targeting $55M+ pretax savings in FY2025 and $85M+ in FY2026.\n- **Customer Wins**: Secured a national QSR partnership for frozen fries and launched new private-label products in grocery channels.\n- **AI & Innovation**: Expanded product portfolio with fridge-friendly fries and licensed brands, signaling long-term growth potential.\n- **Capacity Management**: Closed underutilized plants, curtailed lines to reduce inventory, and monitoring new industry capacity announcements.\n
**【CFO Financial Highlights】**
- **Profitability**: Adjusted EBITDA rose 6% YoY to $364M, driven by higher volumes, lower manufacturing costs, and $7M SG&A savings.\n- **Margins**: GAAP net income was $420M, with Non-GAAP EPS of $1.08 (vs. $0.95 prior year).\n- **Liquidity**: Ended Q3 with $1.1B liquidity, net debt of $4.2B (3.4x leverage), and $485M cash from operations.\n- **Tariff Impact**: 5% of inputs sourced from Canada are USMCA-exempt, mitigating tariff risks.\n
**【Q&A Key Takeaways】**
- **Demand Concerns**: QSR traffic down 2% YoY in North America, with burger chains down 6% in Feb. 2025.\n- **Cost Pressures**: 330bps gross margin decline from fixed factory costs on curtailed lines; 260bps from seasonal trends.\n- **Inventory Management**: Targeting 65-day inventory by year-end, down from prior levels.\n- **Competitive Landscape**: Industry capacity additions delayed; focusing on winning new customers with innovation.\n- **Tariff Outlook**: Minimal FY2025 impact, but monitoring retaliatory tariffs on exports.\n- **AlixPartners Progress**: Evaluating all P&L levers (top-line, COGS, SG&A) with data-driven approach.\n

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