Cavalcanti, JBS CFO. Good morning, and thank you for joining us. >> Good morning Frank.>> All right. Talk to me about the quarter here in the quarter, even though you beat expectations, you talked about a challenging geopolitical environment. What's the challenge and what has changed from a quarter ago.A quarter ago, you guys said there was strong demand for protein. >> The demand for protein still strong. So and we show this quarter I think the challenging factor is more the beef segment in us given the si ...

Core Insights - Wendy's plans to reduce the number of promotions for the remainder of the year after experiencing challenges with too many initiatives during the summer [1][2] - The company reported earnings per share of $0.29, a 7.4% increase year-on-year, and revenue of $560.9 million, a 1.7% decrease, both exceeding analysts' expectations [3] - Foot traffic to Wendy's locations decreased by 3% compared to the same quarter last year, although this was an improvement from a 4.7% decline in Q1 [8] Promotions and Strategy - The interim CEO highlighted that the summer promotions, while appealing, overwhelmed restaurant teams and confused customers [2] - Future focus will be on chicken innovation and a new beverage lineup, including a collaboration with Netflix for the second season of "Wednesday" [3] Technology and Innovation - Wendy's is expanding its use of voice AI for drive-thru orders, aiming to implement this technology in up to 600 restaurants by the end of 2025 [9] - The company has been testing innovative drive-thru solutions, including food delivery robots in underground tunnels [9] Market Reaction - Following the earnings report, Wendy's shares increased by approximately 1.5% [4]

Financial Data and Key Metrics Changes - The company has adjusted its full-year inflation assumption from 4% to 4.5% due to adverse weather conditions affecting crop yields, particularly in the UK [24][25] - The gross margin dropped in Q2, attributed to increased inflation and supply chain challenges [26] Business Line Data and Key Metrics Changes - The company reported a significant focus on cost competitiveness, leading to a reduction in SG&A expenses primarily driven by overheads rather than advertising and promotion [30][31] - Innovations and renovations are expected to contribute nearly double the sales compared to the previous year, with a focus on snacking and protein products [32][34] Market Data and Key Metrics Changes - The market in Q2 experienced a volume decline of approximately 5.5%, particularly in key regions like the UK, due to extreme weather conditions [16][22] - The company has gained market share in volume despite overall market underperformance in categories like fish and vegetables [9][10] Company Strategy and Development Direction - The company is adjusting its ERP implementation strategy to mitigate risks and improve inventory management [7][8] - There is a strong emphasis on innovation, with plans to enhance product offerings in response to changing consumer preferences and weather patterns [34][35] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate current challenges and emphasized the importance of preparing for future weather-related impacts on sales [50][53] - The company is committed to maintaining flexibility in capital allocation, focusing on share buybacks and dividends while being cautious about M&A opportunities [55] Other Important Information - The company is exploring partnerships with startups to enhance its innovation pipeline and speed up product development [43][45] - There is a focus on optimizing the supply chain and reducing complexity within the operational network to improve cost efficiency [40][41] Q&A Session Summary Question: Confidence in full-year guidance - Management acknowledged past challenges with guidance and emphasized lessons learned from ERP implementation and inventory management [6][8] Question: Organic growth expectations for Q3 - Management indicated that while growth is expected in Q3, it is contingent on market conditions and weather patterns [17][19] Question: Inflationary pressures and pricing strategy - Management confirmed an increase in inflation assumptions and indicated plans to adjust pricing where feasible [24][26] Question: SG&A savings initiatives - Management detailed ongoing efforts to reduce overhead costs and improve cost competitiveness [30][31] Question: Innovation pipeline and future products - Management highlighted a significant increase in sales from innovation and renovation, with a focus on snacking and protein products [32][34] Question: Supply chain optimization and facility closures - Management discussed plans for supply chain optimization, including the closure of a smaller factory in the Nordics [40][41] Question: Long-term portfolio adjustments for climate change - Management addressed the need to adapt product offerings to changing weather patterns and consumer preferences [50][53] Question: Capital allocation priorities - Management confirmed ongoing share buybacks and dividends while maintaining flexibility for future opportunities [55]

Financial Data and Key Metrics Changes - The company has adjusted its full-year inflation assumption from 4% to 4.5% due to adverse weather conditions affecting crop yields, particularly in the UK [23][24] - There has been a noted drop in gross margin in Q2, attributed to increased inflation and weather-related challenges [24] Business Line Data and Key Metrics Changes - The company has seen a significant increase in innovation contributions to sales, with expectations for nearly double the previous year's contribution [32][34] - SG&A expenses have been reduced, primarily driven by overhead savings rather than advertising and promotion [30] Market Data and Key Metrics Changes - The market in Q2 experienced a volume decline of approximately 5.5%, particularly in key regions like the UK, which impacted sales [15][21] - The company has gained market share in volume despite overall market underperformance during the hot weather [9][10] Company Strategy and Development Direction - The company is focusing on enhancing its product assortment to better align with changing consumer preferences during hotter weather, including more natural and marinated fish options [51][54] - There is an emphasis on cost competitiveness and maintaining pricing strategies to recover from inflation while avoiding overpricing compared to competitors [30][26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's future despite disappointing first-half performance, citing a strong portfolio and effective strategy [60] - The company is preparing for potential future heat waves by adjusting product offerings and improving supply chain agility [54][51] Other Important Information - The company has conducted share buybacks amounting to €100 million in H1 and announced a dividend, indicating a commitment to returning value to shareholders [56] - The company is exploring partnerships with startups to enhance innovation and speed up product development [44][46] Q&A Session Summary Question: Confidence in full-year guidance after recent performance - Management acknowledged past optimism regarding ERP implementation and excess inventory issues, indicating a more cautious approach moving forward [5][6][8] Question: Organic growth expectations for Q3 and Q4 - Management clarified that while growth is expected in Q3, the overall guidance remains conservative due to market conditions [14][16] Question: Impact of ERP supply disruption on sales - Management confirmed that the ERP lag from the previous year will positively affect comparisons, but current market conditions remain challenging [19][20] Question: Inflationary pressures and pricing strategies for 2026 - Management indicated that pricing adjustments will be necessary to recover from inflation, with a focus on maintaining competitiveness [22][26] Question: SG&A savings and overhead expense reductions - Management detailed ongoing initiatives to reduce overhead costs while remaining competitive in pricing [30][31] Question: Innovation pipeline and future products - Management highlighted a significant increase in sales from innovation and renovation, with a focus on snacking and new product categories [32][34] Question: Supply chain optimization and facility closures - Management discussed plans for supply chain optimization, including the closure of a smaller factory in the Nordics [41][42] Question: Long-term strategies for dealing with climate change - Management emphasized the need for agility in product offerings to adapt to changing weather patterns and consumer preferences [49][54] Question: Capital allocation priorities - Management confirmed ongoing share buybacks and dividends while maintaining flexibility for future opportunities [56][57]

Core Insights - Tyson Foods, Inc. reported third-quarter fiscal 2025 results with both top and bottom lines increasing year over year, surpassing the Zacks Consensus Estimate [1][11] - The company's diversified multi-channel, multi-protein portfolio positions it well to meet robust consumer demand for protein, solidifying its status as a leading global food company [1] Financial Performance - Adjusted earnings were 91 cents per share, exceeding the Zacks Consensus Estimate of 72 cents, and up 4.6% from 87 cents in the year-ago quarter [2] - Total sales reached $13,884 million, a 4% increase year over year, surpassing the Zacks Consensus Estimate of $13,628 million [3] - Average price changes positively impacted the top line by 3.7%, while total volumes dipped by 0.1% year over year [3] - Gross profit for the quarter was $1.1 billion, up from $878 million in the prior year [3] - Adjusted operating income rose 2.9% to $505 million from $491 million in the year-ago period, with an adjusted operating margin of 3.6%, down 10 basis points year over year [4] Segment Performance - **Beef**: Sales increased to $5,603 million from $5,241 million, with volumes down 3.1% and average prices up 10% [5] - **Pork**: Sales rose to $1,506 million from $1,462 million, with volumes growing 1.5% but average prices falling 1.6% [5] - **Chicken**: Sales improved to $4,220 million from $4,076 million, with volumes up 2.4% and average prices up 1.1% [6] - **Prepared Foods**: Sales came in at $2,515 million, up from $2,432 million, with volumes dipping 2.3% and average prices rising 5.7% [6] - **International/Other**: Sales were $557 million compared to $582 million, with volumes down 0.8% and average sales prices declining 3.5% [7] Financial Position - The company ended the quarter with cash and cash equivalents of $1.5 billion, long-term debt of $8.2 billion, and total shareholders' equity of $18.5 billion [8] - Liquidity stood at $4 billion, with expectations to remain above the minimum target of $1 billion in fiscal 2025 [9] - Projected capital expenditure for fiscal 2025 is at or below $1.0 billion, focusing on profit-improvement and maintenance projects [9] - Free cash flow is expected to be in the range of $1-$1.3 billion for fiscal 2025 [9] Future Outlook - The USDA projects domestic protein production to remain relatively flat for fiscal 2025, with specific expectations for each segment [12][13][14] - Total company revenue growth is anticipated in the range of 2-3% for fiscal 2025 compared to fiscal 2024 [15] - Adjusted operating income is projected to be between $2.1 billion and $2.3 billion, with net interest expenses expected at $375 million and an adjusted effective tax rate near 25% for fiscal 2025 [15]

Financial Data and Key Metrics Changes - The total revenue for the company reached 552 crores, reflecting a growth of 12.6% year-over-year, driven by a same-store sales growth (SSSG) of 2.6% and the addition of 63 new restaurants [5][31] - Company EBITDA was reported at 22.5 crores, which is 28.6% higher than the same quarter last year, while restaurant EBITDA increased by 23% to 53.6 crores [6][5] - Gross profit margin has been maintained at around 67.6% despite inflationary pressures, with a target to reach 70% over the next three to four years [31][32] Business Line Data and Key Metrics Changes - The India business showed strong performance with a revenue growth of 12.6% and a net addition of 63 restaurants, while the Indonesia business is in a revitalization phase with a year-over-year growth of 5% in average daily sales (ADS) [5][21] - The company has focused on a "barbell strategy" with both value promotions and premium offerings, including the introduction of the King's collection of premium burgers and a Korean range [11][12][44] Market Data and Key Metrics Changes - In Indonesia, the company has seen a consistent increase in ADS, achieving 19.7 million in the latest reporting period, with a focus on improving dine-in traffic and menu offerings [21][36] - The company has rationalized its restaurant portfolio in Indonesia, closing four additional restaurants, and is working on reducing corporate overhead by 25% [25][26] Company Strategy and Development Direction - The company continues to focus on digital transformation, with 93% of restaurants equipped with self-ordering kiosks and 90% of sales coming from digital platforms [13][14] - The strategy includes enhancing customer experience through technology and maintaining a strong value proposition across all menu layers [17][58] Management's Comments on Operating Environment and Future Outlook - Management noted that the demand environment remains tight, particularly in the premium segment, but the value segment continues to perform well [70][76] - The company is optimistic about future growth, especially with upcoming festive seasons expected to boost traffic [75][79] Other Important Information - The company has implemented cost-saving measures, particularly in utilities and IT, which have contributed to improved margins [18][33] - The introduction of new products and promotions, such as the Korean range and the BK Fusion with KitKat, has been well received by consumers [44][50] Q&A Session Summary Question: What were the one-off impacts on corporate overheads? - The CFO mentioned that one-off impacts included a valuation liability due to defect rate adjustments and some ESOP grants, with the actual valuation around one crore [65][66] Question: How is the overall demand environment perceived? - Management indicated that demand remains similar to previous quarters, with strong performance in the value segment but some softness in the premium layer [70][71] Question: Are transaction counts increasing despite demand softness? - Management confirmed that dine-in traffic continues to be strong, with a focus on value promotions driving customer loyalty [73][74] Question: What is the outlook for margin improvements? - Management highlighted that as the top line grows, margins will improve, with ongoing efforts to reduce rent and utility costs contributing to this [81][82]

Company Performance - BRF's stock price decreased by 3.23% to $3.90, underperforming the S&P 500's daily loss of 0.33% [1] - Over the past month, BRF shares increased by 9.81%, outperforming the Consumer Staples sector's decline of 0.8% and the S&P 500's gain of 4.07% [1] Financial Projections - BRF is expected to report earnings of $0.11 per share, indicating no growth compared to the same quarter last year [2] - For the entire fiscal year, earnings are projected at $0.39 per share and revenue at $12.15 billion, reflecting increases of +8.33% and +11.05% respectively from the previous year [2] Analyst Sentiment - Recent revisions to analyst forecasts for BRF are important as they indicate changing near-term business trends and analysts' confidence in performance [3] Valuation Metrics - BRF has a Forward P/E ratio of 10.33, which is lower than the industry average of 16.17, suggesting it is trading at a discount [6] - The company has a PEG ratio of 0.25, significantly below the industry average PEG ratio of 1.63 [6] Industry Context - The Food - Miscellaneous industry, which includes BRF, has a Zacks Industry Rank of 185, placing it in the bottom 26% of over 250 industries [7] - Stronger industry groups, as indicated by the Zacks Industry Rank, tend to outperform weaker groups by a factor of 2 to 1 [7]

Group 1 - BRF's stock closed at $4.03, reflecting a +2.03% increase, outperforming the S&P 500's gain of 0.28% [1] - Over the past month, BRF shares have increased by 3.67%, while the Consumer Staples sector has decreased by 1.44% [1] - The upcoming financial results are expected to show an EPS of $0.11, unchanged from the same quarter last year, with projected annual earnings of $0.39 per share and revenue of $12.15 billion, representing increases of +8.33% and +11.05% respectively [2] Group 2 - Recent analyst estimate revisions for BRF indicate a positive outlook for the business [3] - The Zacks Rank system, which incorporates estimate changes, currently ranks BRF as 2 (Buy) [5] - The Forward P/E ratio for BRF is 10.13, which is lower than the industry average of 15.4, and the PEG ratio is 0.25 compared to the industry average of 1.61 [6] Group 3 - The Food - Miscellaneous industry, which includes BRF, has a Zacks Industry Rank of 182, placing it in the bottom 27% of over 250 industries [7] - The performance of individual industry groups is measured by the Zacks Industry Rank, with the top 50% rated industries outperforming the bottom half by a factor of 2 to 1 [7]

Group 1 - Consumer behavior is shifting as individuals seek to cut costs, leading to an increase in car payment delinquencies and rising credit card delinquencies [1] - Despite relatively stable inflation, these financial challenges are becoming more pronounced [1] - Observing megatrends can provide insights into societal advancements and potential investment opportunities, although identifying the right companies to capitalize on these trends is complex [1] Group 2 - The focus on fundamentals, quality of leadership, and product pipeline is essential for uncovering investment opportunities [1] - Recent emphasis has been placed on marketing and business strategy for medium-sized companies and startups [1] - Experience includes evaluating startups and emerging industries/technologies, indicating a strong background in assessing growth potential [1]

Summary of Tyson Foods (TSN) FY Conference Call - May 14, 2025 Company Overview - **Company**: Tyson Foods (TSN) - **Event**: FY Conference Call - **Date**: May 14, 2025 Key Industry Insights - The conference focused on the food value chain, including sectors such as agribusiness, protein, food, beverage, distribution, and food retail [2][3] - Tyson Foods has been a consistent participant in this conference for twenty consecutive years, highlighting its significance in the industry [4] Core Company Performance - **Chicken Business**: - Achieved approximately $680 million in adjusted operating income in the first half of the year [6][16] - Expected to maintain strong performance with guidance for the year set between $1 billion to $1.3 billion [16][18] - Focus on value-added products rather than commodity markets, leading to improved margins [9][10] - Continued investment in brand health and product innovation for future growth [7][11] - **Prepared Foods**: - Recorded about $900 million in adjusted operating income in 2024, with expectations for further growth in 2025 [35][38] - Emphasis on operational excellence and innovation pipeline, aiming for significant improvements in efficiency and profitability [39][40] - Plans to regain food service volume and private label business, enhancing overall market presence [44] - **Beef Business**: - Facing challenges with herd rebuilding, but optimistic about future recovery based on USDA data indicating a decrease in cattle harvest [50][51] - Expected losses in the beef segment for 2025 estimated between $200 million to $400 million [18][58] - Focus on controlling costs and enhancing value-added products to mitigate challenges [52] - **Pork and International**: - Pork business showed a reduction in controllable costs by approximately 18% in Q2, indicating operational improvements [60] - International operations are focused on capacity utilization and filling assets in key markets like China and Thailand [62] Financial Management and Capital Allocation - Tyson Foods has maintained a disciplined approach to cash management, with a target leverage ratio of 2x [65][66] - Capital expenditures are projected between $1 billion and $1.2 billion, reflecting a healthy reinvestment rate [66] - The company raised its dividend for the thirteenth consecutive year, reaching $2 per share [67] Strategic Outlook - Tyson Foods aims to enhance its branded portfolio and innovation pipeline, particularly in prepared foods and value-added chicken products [68] - Share repurchases are considered part of the capital allocation strategy, contingent on market conditions and dilution coverage [69] Additional Considerations - The company is navigating a complex environment with strong demand for chicken and challenges in beef production, which may impact overall profitability [28][49] - Continuous improvement in operational efficiency is a key focus across all segments to drive future growth [48]