Core Viewpoint - HNI Corporation will exit its Wayland, New York manufacturing facility by 2027, consolidating production into other North American facilities to improve productivity and customer experience [1][2] Company Strategy - The decision to close the Wayland facility is part of HNI's strategic network optimization journey, aimed at enhancing operational efficiency and customer service [2] - The consolidation will not change the product portfolio, and the Gunlocke brand will remain a key part of HNI's offerings [1] Financial Impacts - HNI estimates that the consolidation will result in annual cost savings of approximately $7.5 to $8.0 million once fully implemented [7] - The total estimated charges related to the consolidation are projected to impact pre-tax earnings by approximately $14.9 million in 2026 and 2027, including $5.7 million in non-cash charges [7] - A detailed breakdown of estimated costs includes $11.6 million in 2026 and $3.3 million in 2027 [4][7] Employment Impact - The closure of the Wayland facility will lead to the termination of approximately 135 employees [5]

Financial Data and Key Metrics Changes - In Q1 of fiscal 2026, the company reported net sales of $7.8 billion, roughly flat compared to the previous year, with adjusted EBITDA of $167 million, up nearly 25% year over year [14][16][20] - The adjusted EBITDA margin was 2.1% of net sales, an increase of 40 basis points year over year, while the gross margin rate was 13.4%, up 20 basis points from the prior year [16][20] - Free cash flow was a use of $54 million, an improvement of about $105 million compared to the previous year's first quarter, and net leverage ratio decreased to 3.2 times, down one full turn from the previous year [18][20] Business Line Data and Key Metrics Changes - The natural product segment grew by 11%, driven by strong unit growth and new business projects, while the conventional product segment saw a decline of about 12% due to the transition out of the Allentown distribution center [14][15] - Retail sales fell by 5%, partly due to store closures, with same-store sales declining by 3% [15][20] Market Data and Key Metrics Changes - Wholesale inflation was approximately 3%, with unit volumes declining about 5% primarily due to network optimization [15] - The company operates in a $90 billion target market, focusing on improving service levels and long-term profitability [5][6] Company Strategy and Development Direction - The company aims to enhance its merchandising capabilities and private brands portfolio to provide competitive advantages for customers [8][70] - The focus is on operational excellence through advanced supply chain technologies and lean management practices, with the deployment of RELEX technology across half of the distribution network [10][19] - The company is committed to reducing net debt and improving its net leverage ratio to below 2.5 times by the end of the fiscal year [20][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving full-year outlooks, citing solid Q1 performance and ongoing efforts to improve customer service and operational efficiency [7][21] - The competitive environment remains challenging, particularly for traditional grocers, but there are opportunities for innovation and differentiation among successful retailers [36][40] Other Important Information - The company is focused on building capabilities to support customers and improve profitability, with a disciplined approach to new business projects and customer relationships [66][68] - The company plans to discuss key capabilities and strategies at the upcoming Investor Day [13][69] Q&A Session Summary Question: Growth in natural products and drop size - Management noted positive trends in drop sizes due to growth with larger customers, which enhances efficiency [25] Question: Fill rates and opportunities - Fill rates have improved due to technology implementation and localized management, with ongoing opportunities for further enhancement [27] Question: EBITDA margin potential in conventional business - Management indicated that the conventional business could see improved profitability through network optimization and supplier programs [28][29] Question: Sustainability of gross margin strength - Gross margin strength is supported by natural growth and supplier funds, with temporary procurement gains viewed as secondary [33][34] Question: Competitive environment in retail - The retail environment is competitive, with innovative retailers outperforming, and the company aims to support them through differentiated strategies [36][40] Question: Customer attrition post-cyber attack - Management reported minimal customer attrition, maintaining strong relationships with existing customers [42] Question: Capital allocation strategy - The focus remains on deleveraging and reducing debt, with no plans for capital returns until leverage targets are met [90]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 was $567 million, down $34 million year-over-year, primarily due to increased accounts receivable cleanup of approximately $20 million [11] - Adjusted EBITDA for the quarter was $243 million, reflecting a margin of 42.9%, which was up 60 basis points sequentially from Q2 [12] - Adjusted free cash flow in the quarter was $122 million, representing a 22% margin or $0.67 per share [15] Business Line Data and Key Metrics Changes - Leasing revenues were $434 million in Q3, a 5% year-over-year decline, but only down 1.3% when excluding write-offs related to accounts receivable cleanup [12][13] - Sales in new and rental units increased by 10% year-over-year [11] - VAPS revenues were flat year-over-year despite volume headwinds, while storage portfolio saw a 10% improvement in rate and mix, partially offsetting a 14% volume decline [13] Market Data and Key Metrics Changes - The Canadian market experienced a slowdown, contributing to approximately $130 million of total revenue, which has been impacted by trade posture changes [35] - The traditional storage business remains weak, while climate-controlled storage units on rent were up 44% year-over-year [50] Company Strategy and Development Direction - The company aims to shift revenue towards more differentiated, higher-value offerings to create consistent results and reduce variability from commoditized lines of business [6][8] - A multi-year network optimization plan is underway to enhance operational efficiency and reduce structural costs, with an estimated $250 million-$350 million in rental fleet units identified for disposal [19][18] - The focus is on reestablishing organic growth through local market initiatives and enterprise accounts, with expectations for enterprise accounts revenue to grow mid to high single digits into 2026 [22][23] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the need for a more conservative approach to guidance to minimize the risk of negative surprises, with revised full-year guidance reflecting current operating conditions [20][8] - The company expects Q4 2025 revenue of approximately $545 million and adjusted EBITDA of approximately $250 million, with a full-year 2025 revenue outlook of around $2.26 billion [20] Other Important Information - The company has amended and extended its ABL Credit Facility, reducing estimated annual cash borrowing costs by approximately $5 million and extending maturity through October 2030 [16] - The company has identified a pathway to improve adjusted EBITDA margins above 45% as units on rent trends begin to improve [6][8] Q&A Session Summary Question: Inquiry about revenue outlook and underperformance - Management noted that seasonal storage components and write-off activities contributed significantly to the lower revenue outlook, with the Canadian market also experiencing a slowdown [34][35] Question: Impact of federal government shutdowns - Management indicated negligible disruption from government shutdowns, with optimism about future penetration into government sectors [39] Question: Clarification on fleet review and potential disposals - Management confirmed that the identified fleet for disposal represents about 10% of total fleet, aimed at optimizing costs without compromising service capabilities [44][45] Question: Trends in order book and activations - The modular order book is down about 1% year-over-year, but activations have shown low single-digit growth recently, while traditional storage remains weak [50] Question: Changes in guidance philosophy - Management emphasized a shift towards conservative guidance to avoid negative surprises, focusing on controllable outcomes [86][87]

Core Viewpoint - United Natural Foods, Inc. (UNFI) is positioned for growth in the natural foods market, supported by a recent stock upgrade and positive sales outlook despite challenges from a cyberattack [1][2][5] Company Overview - UNFI is a leading distributor of natural, organic, and specialty foods in the U.S. and Canada, competing with Sysco and US Foods [1] - The company's market capitalization is approximately $2.3 billion, indicating a substantial presence in the market [3] Stock Performance - UBS upgraded UNFI's stock to a "Buy" rating with a new price target of $42, up from $29, reflecting strong confidence in the company's future performance [1][5] - The stock price recently increased to $38, marking a 1.01% rise, with fluctuations between $37.91 and $39.41 on the same day [2][5] - Over the past year, the stock has experienced a 52-week high of $39.41 and a low of $18.81, highlighting its volatility [4] Financial Performance - UNFI has shown strong momentum in its fourth quarter, with a notable increase in EBITDA due to lean management strategies and network optimization [2][3][5] - The company anticipates solid revenue growth moving forward, supported by strategic initiatives and increasing demand for natural foods [4]

Operational Performance - Azul was the second most on-time airline in July [8] - Average Aircraft On Ground Time decreased by 53% and 2025 IROPs Expenses decreased by 81% [12] - Aircraft Utilization increased by 2% from 11.3 to 11.5 block hours per day [34] Financial Results - 2Q25 Revenue reached R$4.9 billion, an increase of 18.4% compared to 2Q24 [19] - 2Q25 EBITDA was R$1.1 billion with a 23.1% margin [20] - 2Q25 EBIT was R$380 million with a 7.7% margin [21] - RASK increased by 0.8% to R$38.53 cents [19] Strategic Initiatives - Business units accounted for 23% of RASK and R$429 million of EBITDA in 2Q25 [27] - Ancillary Revenues increased by 21% [32] - Productivity increased by 20.5% [34] - CASK decreased by 5.6% from 1Q25 to 2Q25 [37]

Core Insights - PLAY experienced a significant decrease in passenger numbers, carrying 124,587 passengers in July 2025 compared to 187,835 in July 2024, primarily due to a strategic shift in fleet deployment and ACMI leasing agreements [1] - Despite the reduced capacity, the load factor improved to 90.3% from 88.4% in July 2024, indicating strong demand and effective capacity management, particularly in leisure destinations [2] - The operational performance remained solid with an on-time performance of 85.6%, slightly up from 85.4% in July 2024, showcasing the company's focus on operational efficiency [3] Fleet and Route Strategy - PLAY launched its inaugural flight to Valencia, marking its eighth destination in Spain, alongside existing routes to Alicante, Barcelona, Madrid, Malaga, Tenerife, Fuerteventura, and Gran Canaria [4] - The airline also offers flights to four destinations in Portugal: Lisbon, Porto, Faro, and Madeira, reinforcing its commitment to being a leading leisure airline from Iceland [4] Management Commentary - The CEO of PLAY highlighted the positive indicators from the core network strategy, noting the increase in load factor and strong demand despite the transitional period with part of the fleet in ACMI operations [5] - The CEO emphasized the team's efforts in achieving an on-time performance of 85.6% during a peak travel month, reflecting the company's focus on operational excellence [6]

Financial Data and Key Metrics Changes - The second quarter revenue decreased year over year by 0.7% to $817.1 million, with operating ratio at 87.8% compared to 83.3% in the same quarter last year [5][14][18] - Revenue per shipment excluding fuel surcharge increased by 2.7% to $298.71, while including fuel surcharge it increased by 1.8% to $351.36 [14][18] - Total operating expenses increased by 4.7% year over year, with salaries, wages, and benefits rising by 5% due to inflationary pressures [15][18] Business Line Data and Key Metrics Changes - Overall shipments for workdays were down 2.8% year over year, with tonnage only up 0.4% from the first quarter [6][8] - Newer terminals (opened less than three years) saw a 4% sequential improvement in shipments per workday compared to the first quarter [7] - Legacy facilities (open longer than three years) experienced a 2% sequential increase in shipments compared to the first quarter, but down 3.5% year over year [7] Market Data and Key Metrics Changes - The company noted muted volume trends due to the macroeconomic landscape, with overall shipment trends reflecting cautious customer approaches [6][8] - The Los Angeles region showed softer trends, impacting overall performance [9][52] Company Strategy and Development Direction - The company is focused on optimizing variable costs and improving network efficiency while maintaining a customer-centric approach [5][10] - There is an emphasis on getting closer to customers and providing unique solutions, which is part of the long-term strategy [21][22] - The company plans to continue investing in network expansion and technology to enhance operational efficiency [17][23] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to adapt to the dynamic environment, despite the lack of typical volume increases in the second quarter [20] - The focus remains on controllable factors, with a commitment to maintaining high service levels and managing costs effectively [10][20] - Future growth is anticipated as the company continues to mature its facilities and optimize its network [11][106] Other Important Information - The company plans to spend approximately $600 million to $650 million in capital expenditures this year, focusing on network expansion and technology investments [17][99] - The cargo claims ratio was reported at 0.5, indicating effective management of claims [10] Q&A Session Summary Question: Outlook on volumes and pricing for Q3 - Management indicated that tonnage comparisons will become tougher due to new terminal openings last year, but they expect to maintain pricing discipline [26][27] Question: Labor reductions and wage increases - Management clarified that wage increases typically occur in the second half of the year, and headcount adjustments are made to align with volume levels [35][36] Question: Industry capacity and pricing recovery - Management believes that LTL capacity is shrinking over time, and they are well-positioned to leverage their investments in the upcoming market recovery [44][46] Question: Volume trends in July - July tonnage is trending flat, with shipments per day down about 2.25%, reflecting ongoing cautiousness in the market [51][52] Question: Contractual renewals and competitive pricing - The 5.1% renewal rate is lower than previous periods, but management emphasized that the pricing environment remains rational and focused on service quality [58][60] Question: Cost management and operating leverage - Management noted that while some cost actions are tactical, they are also building long-term structural gains through network optimization [67][70] Question: Pricing environment and legacy freight - Management is optimistic about pricing opportunities as they continue to optimize their network and improve service levels [73][75]

Financial Data and Key Metrics Changes - The second quarter revenue decreased by 0.7% year over year to $817.1 million, with operating ratio at 87.8% compared to 83.3% in the same quarter last year [4][13] - Revenue per shipment excluding fuel surcharge increased by 2.7% to $298.71, while including fuel surcharge, it increased by 1.8% to $351.36 [13] - Total operating expenses increased by 4.7% year over year, with salaries, wages, and benefits rising by 5% due to inflationary pressures [14][15] Business Line Data and Key Metrics Changes - Tonnage increased by 1.1% year over year, driven by a 4% increase in average weight per shipment, but overall shipments were down 2.8% [14][5] - Newer terminals (opened less than three years) saw a 4% sequential improvement in shipments per workday compared to the first quarter [6] - Legacy facilities experienced a 2% sequential increase in shipments compared to the first quarter, but down 3.5% year over year [6] Market Data and Key Metrics Changes - Overall shipments for workdays were down 2.8% year over year, reflecting cautious customer behavior amid economic uncertainty [5][6] - The Los Angeles region showed muted trends, contributing to shorter length of haul and lower weight per shipment compared to the first quarter [9] Company Strategy and Development Direction - The company focuses on optimizing variable costs and improving network efficiency while maintaining a customer-centric approach [4][10] - There is an emphasis on expanding the national footprint and enhancing service levels to compete effectively in the industry [11][21] - The company plans to invest approximately $600 million to $650 million in capital expenditures this year to support long-term growth [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term prospects of the company despite current economic challenges, highlighting the importance of customer service and operational efficiency [20][21] - The company is adapting to the changing economic landscape while maintaining discipline around cost structures [11][21] - Management noted that the operating performance remains strong, with expectations for continued improvement as the market conditions evolve [19][20] Other Important Information - The cargo claims ratio for the quarter was 0.5, indicating effective management of customer service and operational execution [10] - The company reduced headcount by about 4.2% from March to June to align with volume trends [11] Q&A Session Summary Question: Volume expectations for Q3 and pricing outlook - Management indicated that volume comparisons will become tougher due to new terminal openings last year, but they expect to maintain pricing discipline [25][27] Question: Labor reductions and wage increases - Wage increases typically occur in the second half of the year, and headcount adjustments are made to align with volume changes [33][35] Question: Industry capacity and pricing implications - Management believes that LTL capacity is likely to remain constrained, which could support pricing in a recovery [41][44] Question: Volume trends in July and customer insights - July tonnage is trending flat, with no significant changes in customer behavior compared to June [50][51] Question: Contract renewals and competitive pricing - The 5.1% renewal rate reflects the competitive nature of the market, but management remains focused on maintaining fair compensation for services [55][57] Question: Network optimization actions - Management highlighted improvements in routing and density as key actions taken to optimize the national network [76][78] Question: Long-term operational goals - Management expressed a commitment to achieving a sub-80% operating ratio through continued focus on customer service and operational efficiency [119]