Flowers Foods, Inc. Q3 FY2025 earnings call

• Proactive efforts to align portfolio with consumer demand, redefining traditional loaf with value and better-for-you attributes. - Integration of Simple Mills is going well with collaboration between teams and new innovation expected for next year. - Foodservice business under pressure due to economic environment, private label has narrowing price gaps with branded products. - Focus on capital allocation, reducing CapEx to return to normalized leverage ratio, reassessing projects for best return.

• No specific 2026 guidance given, but expect inflationary pressure on input costs. - Shifted some CapEx projects to next year and reassessed projects for best return.

• Consumer sentiment and economic uncertainties affecting category demand. - Tariff situation and government shutdown impacting job market and category demand. - Margin pressure from innovation and input cost volatility.

Q: Scott Marks asked about consumer sentiment and category demand recovery.

A: Expected category to stabilize over time, with weakness continuing partway into '26 but seeing stabilization in Q3.

Q: Stephen Robert Powers asked about Simple Mills.

A: Integration going well, new innovation expected next year.

Q: James Salera asked about foodservice and ag commodity prices.

A: Foodservice under pressure, ag commodities volatile with inflationary pressure expected in 2026.

Q: Max Gumport asked about CapEx, dividend, and margins.

A: CapEx reduced for deleveraging, focus on shareholder value, margins pressured by top line and innovation.

Q: Mitchell Pinheiro asked about generational shift and regional brands.

A: Regional brands deemphasized due to retailer consolidation, focus on optimizing cost structure.