Conagra Brands, Inc. (NYSE:CAG) Q3 2023 Earnings Call Transcript

And that is central to our strategy. That’s what we’re doing in frozen, and it’s one of the things that contributed to the growth in the quarter. The only other color I would give on Frozen specifically is something I mentioned at CAGNY, which is to be very profitable in Frozen, you have to have scale. And we have been very deliberate over the last several years and continuing to build our scale in Frozen because when you’ve got scale, you can drive that profit and that margin improvement. And if you’ve got the innovation program that wins with consumers, then you’ve got the trifecta. So that’s really our game plan.

Robert Dickerson: And just to clarify, obviously realized you’re not guiding for next fiscal year, but all of us have to put something in our model. So I’m just curious, if I look at that percent margin operating in Q3, it doesn’t sound — what you’re saying is there’s anything necessarily in there that was one-off that could have inflated that in a given quarter, that’s basically kind of what you were managing toward that hopefully would be somewhat sustainable.

Dave Marberger: Yes, Rob, this is David. I think that’s fair. I think if you kind of step back and you just look at the last two quarters, and this applies to further apply to the entire domestic retail business. The gross margins have inflected why volume has been down 8.5% to 9%. So, we’ve been able to improve the margins with the volume decline because it gets back to the earlier point. We know, there’s elasticities on pricing. So, we knew there was going to be volume declines and we planned for it, and it’s all in the sort of the forecast for the margin. So, we don’t see that materially changing. We’re not going to give you a specific number, but I think those dynamics are right and that’s why this value over volume approach is really important that we look category by category, and we understand the dynamics, and we focus on managing our margin as we manage the volume.

Operator: Thank you. And ladies and gentlemen, this concludes today’s question-and-answer session. I’d like to turn the conference back over to Melissa Napier for any closing remarks.

Melissa Napier: Thank you very much for joining us this morning. Investor Relations is around for any additional follow-up questions that you might have. We hope everyone has a wonderful day.

Operator: Thank you. This concludes today’s conference call. We thank you all for attending today’s presentation. You may now disconnect your lines, and have a wonderful day.