Financial Data and Key Metrics Changes - Net sales for the third quarter were $548 million, an increase of 6% compared to the prior year, with adjusted EBITDA at $120 million and adjusted EBITDA margins at 22% [23][28] - Adjusted gross profit grew 3% year-over-year to $192 million, with a gross profit margin of 35.1%, which decreased by 130 basis points due to input cost inflation and other factors [25][27] - Cash flow from operations was $40 million for the quarter and $92 million year-to-date, with net debt at $91 million and net leverage at two times [27][28] Business Line Data and Key Metrics Changes - Premier Protein's net sales grew 6%, with both volume and pricing up 3%, driven by distribution gains and promotions [23][24] - Premier Protein's consumption grew 19% in Q3, with volume gains contributing approximately 60% of this growth [14][23] - Dymatized net sales increased by 5%, supported by strong growth in international and domestic RTD shake sales [24] Market Data and Key Metrics Changes - The ready-to-drink (RTD) shake category grew 16% in Q3, with 70% of that growth coming from volume [8][9] - Premier Protein holds a 25% market share in the RTD segment, making it the number one brand in both the RTD and broader convenient nutrition categories [14][21] - Household penetration for RTD shakes reached 52%, indicating significant growth potential compared to more mature categories [13][21] Company Strategy and Development Direction - The company aims to leverage its leadership position in the RTD shake category, focusing on brand support, distribution expansion, and innovation [16][18] - Recent marketing campaigns and new packaging are designed to enhance brand visibility and appeal to younger consumers [16][17] - The company is committed to expanding its product offerings, including new lines such as indulgence shakes and almond milkshakes, to attract a broader consumer base [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth potential of the convenient nutrition category, citing strong retailer support and consumer trends [21][39] - The company anticipates continued strong consumption growth for Premier Protein, with expectations for high teens to low 20s growth in Q4 [30][39] - Management acknowledged challenges such as input cost inflation and increased competition but remains optimistic about the company's positioning and market share stability [32][39] Other Important Information - The company has initiated share repurchases, acquiring 1.3 million shares at an average price of $65.07 per share [27] - A settlement in principle was reached regarding legal matters related to the Joint Juice brand, which is expected to impact cash flow in fiscal 2026 [25][26] Q&A Session Summary Question: Long-term potential of the convenient nutrition category and Premier Protein's role - Management indicated it is too early to provide detailed guidance for fiscal 2026 but remains optimistic about long-term opportunities [36][39] Question: Why narrow guidance despite better-than-expected Q3 results - Management explained that minor fluctuations in consumption and competitive pressures led to the decision to narrow guidance rather than push towards the higher end [42][46] Question: Expectations for promotional cadence in light of increased competition - Management stated that promotional cadence has been consistent and will continue to align with historical patterns, particularly during peak promotional periods [70][73] Question: Insights on innovation and capital allocation priorities - Management highlighted strong performance from the indulgence line and ongoing efforts to expand the almond milkshake segment, while capital allocation priorities remain focused on debt reduction and share buybacks [116][118]