Utz Brands, Inc. Q1 FY2026 earnings call

1. Trevor Martin mentioned they're ready to open Q&A. 2. Howard Friedman discussed that April was a more difficult lap due to Easter shift, year-over-year programming, and customer merchandising timing shifts. The food channel overall is positive, and there will be incremental activations in the second quarter like Boulder Canyon's tallow activity, new product innovations, and California growth. 3. BK Kelly talked about being covered for most of the year on fuel, ags, and freight, a 4% productivity program going well, and using various levers to address inflation. 4. Howard Friedman spoke about marketing spend being largely in line with expectations, still a couple of years out from reaching the long-term 3%-4% of sales target, focusing on supporting Power 4 brands, expansion markets, and the tour. 5. He also discussed household penetration drivers being expansion geographies, innovation, and incremental advertising. 6. On competitive activity, they feel commercial plans are holding, observed competitive price changes, but feel confident in their drivers. 7. Regarding bonus bags, it's difficult to break out by core vs expansion markets, but they're holding up well competitively. 8. On the category, they take a conservative view currently, but expansion geographies and innovation are key. 9. For innovation, they focus on better-for-you, flavor, and value areas. 10. BK Kelly mentioned free cash flow with Q1 being a cash-burning quarter but leverage improving year-on-year. 11. Howard Friedman talked about pricing across channels, doing well in national, club, and expansion geographies, and California performance with high single digits and confidence in product earning its place.

1. Guidance for the year was reiterated unchanged. 2. Confidence in achieving 60 to 80 million of free cash flow this year, with improvement expected over the year.

Q: Peter Galbo asked about the softness in 2Q starting in April, if April represents the bottom and improvement in May and June.

A: Howard Friedman said April was a difficult lap due to Easter shift, year-over-year programming, and customer merchandising timing shifts. The food channel is positive, and there will be incremental activations in the second quarter.

Q: Peter Galbo followed up on guidance and hedging program.

A: BK Kelly said they're covered for most of the year on fuel, ags, and freight, a 4% productivity program is going well, and they'll use various levers to address inflation.

Q: Michael Lavery asked about marketing spend, how close to the long-term target, and biggest return opportunities.

A: Howard Friedman said marketing spend is in line with expectations, still a couple of years out from the long-term target, focusing on supporting Power 4 brands, expansion markets, and the tour.

Q: Michael Lavery then asked about household penetration.

A: Howard Friedman said drivers are expansion geographies, innovation, and incremental advertising.

Q: Scott Marks asked about competitor activity and impact on commercial plans, and bonus bags by core vs expansion markets.

A: Howard Friedman said commercial plans are holding, observed competitive price changes but feel confident in drivers, and it's difficult to break out bonus bags by core vs expansion markets.

Q: Rob Dickerson asked about the category, guidance, and innovation.

A: Howard Friedman said they take a conservative view on the category currently, innovation focuses on better-for-you, flavor, and value areas.

Q: Rob Dickerson followed up on free cash flow.

A: BK Kelly said Q1 is a cash-burning quarter but leverage is improving year-on-year.

Q: Jim Salera asked about pricing by channel and California repeat rates.

A: Howard Friedman said they're doing well across channels, and California has high single digits with confidence in product earning its place.