Howard Friedman: Yes. Thanks for the question. Look, I think there are 3 pieces to it, and let me answer your question first, which is we feel great about how our club store and our discounter, and for the most part, the dollar channel is doing. I think if you look where we are executing, we feel very — we’re getting very good results, and we’re continuing to see the growth that we would expect. It’s really driven by a little bit of the untracked channels, small format, and it’s really pretty much pretty well isolated to. We have some price back architecture issues that we kind of talked about. That, I think it would be a fairly significant portion of the issue. The second is really around dips and salsa and you see the spread there between — if you look at just the pure salty pull of the data versus total Utz, you can start to see in the measured channels that difference.
And then the last is the IO conversion, which kind of wanes over time, which is another about 40 basis points. So, we’ll solve the small format issue as we progress through the year. We’re making — we’ve made the changes that we need to. We’ve got to get the assortment in the right place. But with respect to discount dollar value channel in club, we feel very good about our performance.
Robert Moskow: Okay. So, these are small formats that are not picked up in the IRI, because IRI includes convenience stores, but not what you’re — not the small formats.
Howard Friedman: Yes, that’s correct.
Robert Moskow: Okay. And then the last question, fourth quarter, do you feel that you have an easy comparison to your performance a year ago coming up in the fourth quarter. Optically, it looks like that when I look at fourth quarter sales, but there’s all kinds of factors. So, how do you view it?
Howard Friedman: Yes. We think that what we would say is if you look at the progression through the year, as you think about Q1, Q1, there was a lot of noise early. We get through our first quarter, our second quarter really are — it gets progressively a little bit — gets progressively easier once you get through the second quarter as you get into Q3 and Q4, but Q4 is that quarter where we think the lab is the most straightforward.
Robert Moskow: When you say straightforward, you mean apples-to-apples? Or do you mean like — I remember there was some disruption in the fourth quarter a year ago.
Howard Friedman: The easiest lap is in Q4.
Operator: Your last question comes from Jim Salera of Stephens.
Jim Salera: Just want to dig down on Boulder, just given the continued strength of the natural channel there. How much of the assortment of Boulder in natural do you think is transferable to traditional grocery? And I believe, Ajay, you said that now that you’re making Boulder in Hanover, does that improve your ability to go after new distribution on the East Coast? Because correct me if I’m wrong, but I think Boulder is actually one of your few brands that has better market share out West versus in your core markets in the East?
Howard Friedman: Yes. So, I appreciate the question. Look, we’ve been talking about our aspirations for Boulder for a while. And I think it’s one of the brands that we’re particularly excited about, not only because it has a clear point of difference around healthier oils. But to your point about where its geography of origin comes from. So, to answer the question, yes, we believe it is transferable. We believe that the consumer interest in healthier oils will be true across the country and that we are seeing really good distribution gains as we’re moving east. And we’re also seeing good distribution opportunities as we think about places like club. So, to Ajay’s point, we put in the capital to be able to make the product in the East specifically to address the higher levels of demand that we’re starting to see.
And if you certainly look at the core performance in the first quarter, you’re seeing that transferable demand. So, we’re excited about Boulder. I think it is a brand that is growing nicely and growing quickly, and consistently. And as we build over time, we are staging our supply chain to be able to meet that demand.
Jim Salera: Great. And if I could maybe ask one more on just retailer engagement on the recent innovation launches. I know in my local grocery store. I’ve seen Mike’s Hot Honey mix minis on end caps along with some of the other activation. Do you have a sense for how many incremental households that brings to the brand? And if you can offer any color on maybe conversion from, let’s say, like the mixed minis back to the traditional core potato chip offerings?
Howard Friedman: Yes. I think it’s still early. We’re sort of in, I think, the second purchase cycle. So, we won’t really have a good read for a few more months to be able to see the trial and repeat data. What I can tell you, and I’m pleased that you’re a local retailer actually has the product is that we are seeing good retailer acceptance across our innovation so far because of both the need states that we’re identifying. And frankly, some of the subcategories that we’re entering into, where the growth is really the most attractive. So, in mix mini’s case, obviously, the flavored pretzel segment is growing fast. And we want — we were there earlier with apps to be able to bring our flagship Utz brand in as well was important.
And then in the case of Mike’s Hot Honey and the Zapp’s season pretzels, bringing in hot spicy which is also a fast-growing segment of the category. So, retailers have been very positive. Early sales are good. It’s still early to understand what the trial and repeat data is, but we’ll be happy to share it as soon as we have it.
Operator: Ladies and gentlemen, that concludes today’s call. Thank you all for joining. You may now disconnect.
