CONAGRA BRANDS INC. Q1 FY2026 earnings call

• Q1 consumption trends in volume and dollars improved meaningfully from Q4 fiscal 2025 levels, with 44% of portfolio holding or gaining volume share. - Frozen portfolio had solid progress with volumes up 3.2 points, share gains in key categories like frozen vegetables, meals, and prepared chicken. - Snacks business performed in line with expectations, with strong volume in strategic protein snacks but discrete impacts from merchandising timing and pricing. - Staples portfolio saw Hebrew National recovery and volume share gains in certain categories. - Supply chain achieved 98% service levels and over 5% productivity gains, completed Chef Boyardee and frozen seafood divestitures to reduce net debt.

Grocery and Snacks delivered net sales of $1.1 billion, representing a 1% decline in organic net sales versus the prior year. Refrigerated and Frozen segment also had net sales of $1.1 billion with organic net sales up 0.2% versus the prior year. International segment organic net sales declined 3.5% versus the prior year. Foodservice segment organic net sales returned to growth in the first quarter, increasing 0.2% over the prior year.

• Reaffirm fiscal 2026 full-year guidance: organic net sales growth of negative 1% to positive 1%, adjusted operating margin of approximately 11% to 11.5%, adjusted EPS of 1.7 to 1.85. - Q2 expected organic net sales decline in low single digits. - Full-year inflation now in low 7% range, slightly higher than original projection. - A&P and adjusted SG&A excluding A&P expected to remain at approximately 2.5% and 10% of sales respectively. - Fiscal 2026Q1 cash tax payments favorable by ~$75 million, full-year tax rate expected at ~24%, interest expense ~$390 million.

• Persistent inflationary pressure and weak consumer sentiment. - Changes to country-specific tariff rates nudging estimates higher, larger exposures to steel, aluminum, and China-related tariffs. - Unfavorable operating leverage from lower internal production volumes.