Dave Marberger: Yes, David, we’re going to give more detailed guidance on fiscal year ’24 inflation on our July call. I think to do it now, I think, is a bit premature. What I can tell you is, as you’ve seen every quarter, our market inflation has been decelerating, okay? So the rate of inflation has come down, and we expect that to continue into Q4. We guided to approximately 10%, which implies about a 5.5% market inflation rate in Q4. In terms of the 8% that we saw in Q3, it’s still roughly about 10% is materials, which is 2/3 of our cost, right, ingredients and packaging. So we are still seeing market inflation at a high level there, although it is coming down, as I mentioned. And then when you get into the manufacturing side with labor, that’s more kind of higher — mid- to higher single digits there.
And then the transportation and warehousing has actually been kind of lower single digits. So that has been coming down stronger. So that’s where we are now, but we’re not going to give all that detail until we do it in the context of our full guidance for fiscal ’24. I think that’s the way we want to do it.
Operator: Thank you. And our next question today comes from Nik Modi with RBC Capital Markets. Please go ahead.
Nik Modi: Just question, Sean, on how you’re thinking about the rolling off of the SNAP benefits and the impact obviously it has on just the overall packaged food space. Just curious, if you have any thoughts on states that rolled off last year and if you have any observations there? And then just tied to that, given how dynamic the promotional environment is and how savvy Conagra has been with digital, I’m just curious like how you think about measuring the ROI of some of that spend? Do you expect that kind of digital promotion side of the business to really start ramping in the back half of the year?
Sean Connolly: Sure, Nik. Let’s talk SNAP first. So out of the 50 states, we’ve got 18 rolled off of these — they’ve sunset these emergency allotments previously and then you got 32 that just rolled off recently. So what do we know so far? What we know is that what we saw in terms of impact to our portfolio from the ’18 was no material impact. And we’ve been tracking that for some time. I’ve mentioned this on calls before and we just not have not seen any material impact there. And I will give you, as I did last quarter, one perspective on why I think that’s the case for our portfolio is we already do have really great value offerings within the Conagra portfolio. So if you’ve got more limited SNAP allotments it would seem logical to me that you would use them on the things that are inherently harder to afford.
And our products are inherently easier to afford and that may explain why we’ve seen such modest impact. But you’ve got 32 states that have just recently come off. It’s just — it’s brand-new data. We’re going to — we monitor this over an 8-, 10-week period, so we can see if there’s any movement there, and we will do just that. But based on what we’ve seen in the ’18 thus far, I just don’t have a good rationale for saying that, that would be any different of a result. With respect to digital, I would say you used the word promotion. I think what we do is digital marketing. I mean we do literally do some digital promotion with our customers, where they shop online, things like that. And we invest in search to make sure people find our products.
