荷美爾 (HRL) 2023 Q4 法說會逐字稿

Good morning, ladies and gentlemen, and welcome to the Hormel Foods Corporation Fourth Quarter Earnings Conference Call. At this time, all lines are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. (Operator Instructions) This call is being recorded on Wednesday, November 29, 2023. I would now like to turn the conference over to David Dahlstrom, Director of Investor Relations. Please go ahead, sir.

早安，女士們、先生們，歡迎參加荷美爾食品公司第四季財報電話會議。此時，所有線路都處於只聽模式。演講結束後，我們將進行問答環節。 （操作員說明）本次電話會議於 2023 年 11 月 29 日星期三進行錄音。我現在想將會議轉交給投資者關係總監 David Dahlstrom。請繼續，先生。

Good morning. Welcome to the Hormel Foods conference call for the fourth quarter of fiscal 2023. We released results this morning before the market opened, around 6:30 a.m. Eastern Time. If you did not receive a copy of the release, you can find it on our website, hormelfoods.com under the Investors section.

早安.歡迎參加荷美爾食品 2023 財年第四季的電話會議。今天早上，美國東部時間早上 6:30 左右開市前，我們發布了業績。如果您沒有收到該新聞稿的副本，您可以在我們的網站 hormelfoods.com 的「投資者」部分找到它。

On our call today is Jim Snee, Chairman of the Board, President and Chief Executive Officer; Jacinth Smiley, Executive Vice President and Chief Financial Officer; and Deanna Brady, Executive Vice President of the Retail segment. Jim will review the company's fiscal 2023 fourth quarter and full year results and provide a perspective on our outlook for fiscal 2024. Justin will then provide detailed financial results and further commentary on our outlook. Deanna will join Jim and Justin for the Q&A portion of the call. The line will be open for questions following Justin's remarks. As a courtesy to the other analysts, please limit yourself to one question with one follow-up. If you have additional questions, you are welcome to get back into the queue. At the conclusion of this morning's call, a webcast replay will be posted to our investor website and archived for 1 year.

今天與我們通話的是董事會主席、總裁兼執行長 Jim Snee； Jacinth Smiley，執行副總裁兼財務長；迪安娜·布雷迪 (Deanna Brady)，零售部門執行副總裁。 Jim 將回顧公司 2023 財年第四季和全年業績，並對我們對 2024 財年的前景提出看法。然後 Justin 將提供詳細的財務業績並對我們的前景進行進一步評論。迪安娜將與吉姆和賈斯汀一起參加電話會議的問答部分。賈斯汀發表講話後，該熱線將開放供提問。出於對其他分析師的禮貌，請限制自己只回答一個問題並進行後續跟進。如果您還有其他問題，歡迎您回到隊列。今天早上的電話會議結束時，網路廣播重播將發佈到我們的投資者網站上並存檔一年。

Before we get started this morning, I need to reference the safe harbor statement. Some of the comments made today will be forward-looking, and actual results may differ materially from those expressed in or implied by the statements we will be making. Please refer to our most recent annual report on Form 10-K and quarterly reports on Form 10-Q, which can be accessed at hormelfoods.com under the Investors section. Additionally, please note the company uses non-GAAP results to provide investors with a better understanding of the company's operating performance. The presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP. Non-GAAP figures adjust for the impact of an adverse arbitration ruling noncash impairment charges and costs associated with the company's transformation and modernization initiatives. These non-GAAP measures include adjusted operating income, adjusted operating margin, adjusted selling, general and administrative expenses as a percent of sales, adjusted diluted net earnings per share and net debt to EBITDA. Discussion on non-GAAP information and reconciliations to the GAAP results are detailed in our press release and earnings supplement, which can be accessed from our corporate or investor website. I will now turn the call over to Jim Snee.

在我們今天早上開始之前，我需要參考安全港聲明。今天發表的一些評論將具有前瞻性，實際結果可能與我們將發表的聲明中表達或暗示的結果有重大差異。請參閱我們最新的 10-K 表格年度報告和 10-Q 表格季度報告，您可以在 hormelfoods.com 的「投資者」部分存取該報告。此外，請注意，公司使用非公認會計準則績效是為了讓投資人更了解公司的營運績效。此資訊的呈現不應被孤立地考慮或作為根據 GAAP 呈現的財務資訊的替代品。非公認會計準則數據根據不利仲裁裁決的影響進行了調整，包括與公司轉型和現代化措施相關的非現金減損費用和成本。這些非公認會計準則指標包括調整後的營業收入、調整後的營業利潤率、調整後的銷售、一般和管理費用佔銷售額的百分比、調整後的攤薄每股淨利潤以及 EBITDA 淨負債。有關非公認會計原則資訊的討論以及與公認會計原則結果的調節詳見我們的新聞稿和收益補充資料，可從我們的公司或投資者網站訪問。我現在將把電話轉給吉姆·斯尼。

Thank you, David. Good morning, everyone. Fiscal 2023 was a challenging year for the organization as we navigated an environment that remain volatile, complex and high cost. Regardless, our results did not meet our expectations. We still achieved our second consecutive year of net sales in excess of $12 billion, continue to reinvest in the growth of our leading brands, drove strong operating cash flows of $1 billion, returned a record amount of cash to our shareholders in the form of dividends and achieved the safest year in our company's history.

謝謝你，大衛。大家，早安。 2023 財年對該組織來說是充滿挑戰的一年，因為我們所處的環境仍然不穩定、複雜且成本高昂。不管怎樣，我們的結果沒有達到我們的期望。我們仍然連續第二年實現淨銷售額超過 120 億美元，繼續對領先品牌的成長進行再投資，帶動 10 億美元的強勁營運現金流，以股息形式向股東返還創紀錄的現金數額並實現了我們公司史上最安全的一年。

We also made further progress on our evolution as a global branded food company, including the implementation of our go-forward operating model, and the integration of Jennie-O Turkey Store. As we turn the page to fiscal 2024, there is urgency across the organization to improve our business. And as we outlined at our recent Investor Day, we have identified a clear, realistic and achievable path to return the business to its historical earnings trajectory. Our focus going forward is clear: first, restore a sustainable and dependable bottom line growth from our current business; second, drive savings by minimizing complexity and reducing costs; and third, capture incremental value from our investments. Our first milestone will be our performance in fiscal 2024, which is expected to be an investment year for the company.

我們在作為全球品牌食品公司的發展方面也取得了進一步的進展，包括實施我們的前進營運模式以及整合 Jennie-O 土耳其商店。當我們翻過 2024 財年的新一頁時，整個組織都迫切需要改善我們的業務。正如我們在最近的投資者日所概述的那樣，我們已經確定了一條清晰、現實且可實現的路徑，使業務恢復到歷史盈利軌跡。我們未來的重點很明確：首先，從我們目前的業務中恢復可持續、可靠的獲利成長；其次，透過最大限度地降低複雜性和降低成本來節省開支；第三，從我們的投資中獲取增量價值。我們的第一個里程碑將是 2024 財年的業績，預計該年將是公司的投資年。

As with any year, success will be predicated on how we execute against our strategy. First, we must drive focus and growth in our retail business. our nearly $8 billion powerhouse of leading brands, talented people and strong capabilities. Our retail team has made tremendous progress implementing the go-forward structure, which involves combining seven retail businesses and standing up our brand fuel center of excellence. Importantly, the retail team now operates with a single vision and clear strategic focus. We expect this team to win with our consumers and our customers, better allocate our resources to drive profitable growth, and improve the margin structure of the business. Second, we must continue to expand our leadership position in food service. This business has emerged from the pandemic stronger. And again delivered excellent results in fiscal 2023.

與任何一年一樣，成功將取決於我們如何執行我們的策略。首先，我們必須推動零售業務的重點和成長。我們價值近 80 億美元，由領先品牌、人才和強大能力組成。我們的零售團隊在實施前進結構方面取得了巨大進展，其中包括合併七個零售業務並建立我們的品牌燃料卓越中心。重要的是，零售團隊現在以單一願景和明確的策略重點運作。我們期望這個團隊能夠贏得我們的消費者和客戶的青睞，更好地配置我們的資源來推動獲利成長，並改善業務的利潤結構。其次，我們必須繼續擴大我們在餐飲服務領域的領導地位。這項業務在疫情過後變得更強大。並在 2023 財年再次取得了優異的業績。

In fiscal 2024, we expect continued growth in food service. We are confident that we can accelerate growth in the key categories of bacon, pepperoni, prepared proteins and turkey. Also, we can establish a digital leadership position in the industry and expand our presence in the C-store channel. Third, we must aggressively develop our global presence, which starts with reigniting growth in our international business. Fiscal 2023 was a particularly challenging year for our international business due to softness in China, weak commodity markets and higher-than-expected elasticities on our branded export business. While results in the first quarter of fiscal 2024 are assumed to remain challenged, we anticipate a steady recovery beginning in the second quarter. In fiscal 2024, we expect to benefit from more normalized shipments of SPAM to the Philippines, and easing of headwinds in our commodity businesses and recovery in China. As the near-term headwinds abate, we anticipate this business to resume delivering accelerated growth. Fourth, we must execute our enterprise-wide entertaining and snacking vision by unlocking the power of our brands across the channels where we compete.

2024 財年，我們預期餐飲服務將持續成長。我們有信心能夠加速培根、義大利辣香腸、預製蛋白和火雞等關鍵類別的成長。此外，我們還可以在業界建立數位化領導地位，並擴大我們在便利商店通路的影響力。第三，我們必須積極發展我們的全球業務，這首先要重振我們的國際業務成長。由於中國經濟疲軟、大宗商品市場疲軟以及我們品牌出口業務的彈性高於預期，2023 財年對我們的國際業務來說是特別具有挑戰性的一年。儘管假設 2024 財年第一季的業績仍面臨挑戰，但我們預計第二季將開始穩定復甦。到 2024 財年，我們預計將從菲律賓垃圾郵件運輸更加正常化、我們大宗商品業務阻力的緩解以及中國的復甦中受益。隨著近期不利因素的減弱，我們預期該業務將恢復加速成長。第四，我們必須透過在我們競爭的管道中釋放我們品牌的力量來執行我們整個企業範圍的娛樂和零食願景。

We are positioned to win in this on-trend category with brands such as Planters, Corn Nuts, Hormel Pepperoni, Columbus and HORMEL GATHERINGS. We have been pleased with the momentum we have built in the back half of the year for the Planters business. Data for the latest quarter shows accelerating dollar and unit sales. In addition to share household penetration and distribution gains. Much of this momentum is being driven by innovation. Our new flavored cashews line is meeting or exceeding expectations in the marketplace. Over-indexing with millennial consumers, growing household penetration and introducing new consumers to the category. To capitalize on this success, we are launching another flavored cashew variety in fiscal 2024 in addition to a slate of new-to-market innovations. We have aggressive plans to keep the momentum going for our Planter Snack Nuts business in fiscal 2024, led by further innovation new distribution, brand investments and effective promotional support. We continue to do our part as the category leader to support the planters and corn nuts brands to drive growth for our business, the category and for our customers.

我們準備憑藉 Planters、Corn Nuts、Hormel Pepperoni、Columbus 和 HORMEL GATHERINGS 等品牌在這個流行類別中獲勝。我們對今年下半年播種機業務所建立的勢頭感到滿意。最新季度的數據顯示美元銷售額和銷量不斷成長。除了分享家庭滲透率和分銷收益。這種勢頭很大程度上是由創新驅動的。我們的新風味腰果系列滿足或超越了市場預期。過度關注千禧世代消費者，提高家庭滲透率，並將新消費者引入該類別。為了利用這項成功，除了一系列新上市創新產品之外，我們還將在 2024 財年推出另一種風味腰果品種。我們制定了積極的計劃，以進一步創新的新分銷、品牌投資和有效的促銷支持為主導，在 2024 財年保持 Planter Snack Nuts 業務的發展勢頭。我們將繼續作為品類領導者盡自己的一份力量，支持種植者和玉米堅果品牌，推動我們的業務、品類和客戶的成長。

Fifth, we must future fit our one supply chain. Which means reducing costs and minimizing complexity while investing in long-term growth. We recently announced that we are converting the Barron Wisconsin plant, which currently operates turkey harvest and value-added production lines into a value-added facility to support growth across our broader portfolio. Harvest operations are expected to cease during the second quarter of fiscal 2024. These actions at the Barron facility are consistent with the goals we laid out in late 2021 and when we first announced transformational efforts at Jennie-O Turkey Store.

第五，我們未來必須適應我們的單一供應鏈。這意味著在投資長期成長的同時降低成本並最大限度地降低複雜性。我們最近宣布，我們正在將威斯康辛州巴倫工廠改造為增值設施，以支持我們更廣泛的產品組合的增長，該工廠目前運營火雞收穫和增值生產線。收穫作業預計將在 2024 財年第二季停止。Barron 工廠的這些行動與我們在 2021 年底以及我們首次宣布 Jennie-O 土耳其店轉型工作時制定的目標一致。

We are committed to building a more demand-oriented and optimized Turkey portfolio that is better aligned to the changing means of our customers, consumers and operators. The actions at the Barron plant further rightsized our turkey supply chain supporting consistent top line growth, improved profitability and decreased exposure to commodity volatility. We are also committed to optimizing the Jennie-O Turkey Store system. Including freeing up plant space to support growth across the broader Hormel Foods portfolio. The Barron plant is expected to support high demand and high growth product lines across all areas of the organization. Lastly, we are committed to integrating the Turkey business into the broader organization to drive efficiencies and growth. Our retail, foodservice and international segments have been directly supporting the Turkey business for a year. And we anticipate this continued collaboration to drive long-term growth for the Jennie-O brand and across our entire Turkey portfolio.

我們致力於打造更以需求為導向和優化的土耳其產品組合，以更好地適應我們的客戶、消費者和營運商不斷變化的方式。巴倫工廠的行動進一步調整了我們的火雞供應鏈，支持持續的營收成長、提高獲利能力並減少大宗商品波動的風險。我們也致力於優化Jennie-O土耳其商店系統。包括釋放工廠空間以支持更廣泛的荷美爾食品產品組合的成長。巴倫工廠預計將支援該組織所有領域的高需求和高成長產品線。最後，我們致力於將土耳其業務整合到更廣泛的組織中，以提高效率和成長。我們的零售、餐飲服務和國際部門一年來一直直接支援土耳其業務。我們預計這種持續合作將推動 Jennie-O 品牌以及我們整個土耳其產品組合的長期成長。

Finally, we must transform and modernize our company, which is a critical piece to our projected growth over the next 3 years. At our recent Investor Day, we detailed our plans to transform and modernize the organization. Over the next 3 years, we expect to invest approximately $250 million in implementation, personnel and project costs, including investments in capital expenditures and technology. We expect around 1/3 of this investment to be made in fiscal 2024, resulting in a modest benefit to net earnings for the year. Looking to the out years, we are targeting $200 million plus in operating income growth by fiscal 2026 from the transformation and modernization initiative across the supply chain and portfolio optimization. To be clear, we expect a modest benefit to net earnings in 2024, which has been factored into our outlook. We expect benefits to accelerate in fiscal 2025. We expect to achieve our target in fiscal 2026, and we expect this initiative to provide significant residual benefit in fiscal years 2027 and beyond. Through transformational work, we expect to build significant capabilities for the future. This is truly exciting work for the organization.

最後，我們必須對我們的公司進行轉型和現代化，這是我們未來三年預計成長的關鍵部分。在最近的投資者日上，我們詳細介紹了組織轉型和現代化的計劃。未來 3 年，我們預計將投資約 2.5 億美元用於實施、人員和專案成本，包括資本支出和技術投資。我們預計約 1/3 的投資將在 2024 財年進行，為本年度淨利帶來適度收益。展望未來，我們的目標是到 2026 財年透過整個供應鏈的轉型和現代化舉措以及產品組合優化實現營業收入成長 2 億美元以上。需要明確的是，我們預計 2024 年淨利潤將出現適度增長，這已納入我們的展望中。我們預計效益將在 2025 財年加速。我們預計在 2026 財年實現我們的目標，並且我們預計這一舉措將在 2027 財年及以後提供顯著的剩餘效益。透過轉型工作，我們期望為未來建立重要的能力。對於該組織來說，這確實是一項令人興奮的工作。

Before I provide further color on our fiscal 2024 outlook, I want to briefly detail how we finished fiscal 2023. Net sales for the fourth quarter were $3.2 billion, and diluted net earnings per share were $0.36. Excluding the impact of noncash impairments and investments in transformation and modernization adjusted diluted net earnings per share were $0.42. As expected, our Foodservice segment finished the year strong. While the risks we identified heading to the quarter, including pricing headwinds in Turkey, lower retail volumes and continued pressures in our international business negatively impacted results. These results were in line with the low end of our revenue and adjusted diluted net earnings per share expectations.

在進一步闡述我們的 2024 財年展望之前，我想簡要介紹我們如何完成 2023 財年。第四季的淨銷售額為 32 億美元，攤薄後每股淨利為 0.36 美元。排除非現金減損以及轉型和現代化投資的影響，調整後稀釋後每股淨利為 0.42 美元。正如預期的那樣，我們的餐飲服務部門今年表現強勁。儘管我們在本季發現的風險（包括土耳其的定價逆風、零售量下降以及國際業務的持續壓力）對業績產生了負面影響。這些結果符合我們收入和調整後攤薄每股淨利潤預期的低端。

Turning to our outlook for fiscal 2024, we expect to drive modest volume and net sales growth for the full year. This growth is expected to come from our key categories, supported by higher brand investments and innovation. In retail, we expect higher net sales across many of our verticals, including bacon, convenient meals and proteins, global flavors, emerging brands and snacking and entertaining. We have embedded in our outlook, targeted pricing actions, a step-up in innovation and higher brand support to drive volume and improve mix. In Foodservice, we are anticipating broad volume growth led by Turkey, pepperoni and bacon. In addition to higher volumes, net sales are expected to benefit from higher raw material input markets. In our international business, we expect net sales increases to be driven by the branded export business led by SPAM and Skippy and improvement in both the retail and foodservice channels in China. From a bottom line perspective, we expect growth from the foodservice and international businesses and expected decline in our retail segment.

談到我們對 2024 財年的展望，我們預計全年銷售和淨銷售額將溫和成長。這一成長預計將來自我們的關鍵類別，並得到更高的品牌投資和創新的支持。在零售方面，我們預計許多垂直領域的淨銷售額將會更高，包括培根、輕食和蛋白質、全球風味、新興品牌以及零食和娛樂。我們在展望中融入了有針對性的定價行動、加強創新和更高的品牌支持，以推動銷售和改善產品組合。在餐飲服務領域，我們預計火雞、義大利辣香腸和培根的銷售量將大幅成長。除了銷售增加之外，預計淨銷售額也將受益於原材料投入市場的增加。在我們的國際業務中，我們預計淨銷售額的成長將由 SPAM 和 Skippy 主導的品牌出口業務以及中國零售和餐飲服務管道的改善所推動。從獲利角度來看，我們預計餐飲服務和國際業務將成長，而零售業務預計將下降。

While the retail segment is expected to benefit from sales growth and improved mix, we do not anticipate this growth to overcome the significant headwind from the rapid decline in the commodity whole turkey market. For context, whole turkey prices begin calendar year 2023 at all-time highs and have since fallen below the 5-year average. We are closely monitoring sell-through of whole turkeys this holiday season as well as any potential supply impacts from HPAI, which has again affected flocks this fall. These are very unusual market dynamics, which has added additional risk and uncertainty to our outlook. Given these factors in Turkey, we have included in our outlook meaningfully lower market pricing on our high-volume whole turkey business. Similar to the dynamics we experienced in the fourth quarter, we expect earnings to decline in the first half of the year due to the impact from lower turkey markets, lower volumes in the retail segment and continued softness in our China business. We expect these pressures to have the greatest impact in the first quarter. Taking all these factors into account, we expect net sales growth of 1% to 3%. Diluted net earnings per share to be $1.43 to $1.57 and adjusted diluted net earnings per share to be $1.51 to $1.65. And we expect a modest benefit to net earnings from our transformation and modernization initiative.

雖然零售部門預計將受益於銷售成長和產品組合的改善，但我們預計這種成長不會克服整個火雞市場商品迅速下滑帶來的重大阻力。就背景而言，整隻火雞的價格從 2023 年開始就處於歷史高位，此後已跌破 5 年平均。我們正在密切關注本假期整隻火雞的銷售情況以及高致病性禽流感對供應的任何潛在影響，高致病性禽流感今年秋天再次影響了雞群。這些都是非常不尋常的市場動態，這為我們的前景增加了額外的風險和不確定性。考慮到土耳其的這些因素，我們在展望中將我們大批量的整隻火雞業務的市場定價納入了有意義的降低。與我們在第四季度經歷的動態類似，由於土耳其市場走低、零售業務銷售下降以及中國業務持續疲軟的影響，我們預計上半年獲利將下降。我們預計這些壓力將在第一季產生最大的影響。考慮到所有這些因素，我們預期淨銷售額將成長1%至3%。稀釋每股淨利為 1.43 美元至 1.57 美元，調整後稀釋每股淨利為 1.51 美元至 1.65 美元。我們預計我們的轉型和現代化計劃將為淨利潤帶來適度的好處。

As I alluded to earlier, we have embarked on an initiative to return the business to its historical earnings trajectory and deliver on the commitment we made at our Investor Day. To reiterate the key elements of this initiative. In fiscal 2024, we expect a year of investment, which assumes underlying growth across many parts of our current business, offset by a significant headwind from Turkey, higher salaries and normalized employee-related expenses, the impact from our new labor agreement and higher support for our leading brands. It also assumes investments into our transformation and modernization initiative, resulting in a modest benefit to the year, and it assumes capturing incremental value from planters, our Turkey business integration go forward and the investments we've made in additional capacity. In fiscal 2025, we expect to accelerate growth, which assumes strength from the underlying business, significant benefits from supply chain savings and portfolio optimization and further strategic value capture.

正如我之前提到的，我們已開始採取一項舉措，使業務恢復到歷史獲利軌跡，並兌現我們在投資者日所做的承諾。重申該倡議的關鍵要素。 2024 財年，我們預計投資一年，假設我們目前業務的許多部分都將實現潛在增長，但被土耳其的重大阻力、更高的工資和正常化的員工相關費用、新勞工協議的影響以及更高的支持所抵消為我們的領先品牌。它還假設對我們的轉型和現代化計劃進行投資，從而為今年帶來適度的效益，並假設從種植者那裡獲取增量價值，我們的土耳其業務整合繼續進行，以及我們對額外產能進行的投資。到 2025 財年，我們預計將加速成長，前提是基礎業務實力雄厚、供應鏈節約和投資組合優化帶來顯著效益，以及進一步獲取策略價值。

In fiscal 2026, we expect to deliver at least $250 million in operating income growth. As we begin 2024, we remain focused on our strategic priorities, executing our transformation and modernization initiative, fueling our innovation pipeline and exiting the year with momentum in our business segments. I remain confident that we have the right brands, strategy, people and culture that deliver on our commitment to improve our business and drive long-term shareholder returns and growth.

2026 財年，我們預計營業收入將達到至少 2.5 億美元的成長。 2024 年伊始，我們將繼續專注於我們的策略重點，執行我們的轉型和現代化計劃，推動我們的創新管道，並以業務部門的勢頭結束這一年。我仍然相信，我們擁有正確的品牌、策略、人員和文化，能夠兌現我們改善業務、推動股東長期回報和成長的承諾。

In closing, I want to recognize all the hard work carried out by our team in what was a challenging year. We successfully completed a very large reorganization, made progress addressing near-term challenges facing the business and accelerated the transformational work that will better position the company for future success. At this time, I will turn the call over to Jacinth Smiley, to discuss detailed financial information related to fiscal 2023 and added color on key drivers to our outlook.

最後，我想對我們團隊在充滿挑戰的一年中所做的所有辛勤工作表示認可。我們成功完成了大規模重組，在解決業務面臨的近期挑戰方面取得了進展，並加快了轉型工作，從而更好地為公司未來的成功奠定了基礎。此時，我將把電話轉給 Jacinth Smiley，討論與 2023 財年相關的詳細財務信息，並為我們的前景增添關鍵驅動因素。

Thank you, Jim. Good morning, everyone. Full year net sales were $12.1 billion, the second highest net sales achievement in our history. We also delivered $2 billion in gross profit for the year. Full year selling, general and administrative expenses increased compared to last year, primarily due to an adverse arbitration ruling. On an adjusted basis, selling, general and administrative expenses as a percent of net sales finished comparable to the per year at 7.1%. The Advertising investments for the fiscal 2023 year were $160 million compared to $157 million last year. We have planned another increase in advertising investment in fiscal 2024 as we continue to support our leading brands in the marketplace. For fiscal 2023, equity and earnings of affiliates increased due to significantly higher results from MegaMex Foods. Operating income for fiscal 2023 was $1.1 billion and adjusted operating income was $1.2 billion. Operating margin and adjusted operating margins were 8.9% and 9.8%, respectively. The tax rate for fiscal 2023 was 21.8%, marginally higher than last year. The effective rate for fiscal 2024 is expected to be 21% to 23%. For the full year, diluted net earnings per share were $1.45. Excluding the impacts of an adverse arbitration ruling noncash impairments and the investments in our transformation and monetization initiative. Adjusted diluted net earnings per share were $1.61.

謝謝你，吉姆。大家，早安。全年淨銷售額為 121 億美元，是我們史上第二高的淨銷售額表現。我們今年也實現了 20 億美元的毛利。全年銷售、一般和管理費用與去年相比有所增加，主要是由於不利的仲裁裁決。調整後的銷售、一般和管理費用佔淨銷售額的百分比與去年同期持平，為 7.1%。 2023 財年的廣告投資為 1.6 億美元，去年為 1.57 億美元。我們計劃在 2024 財年再次增加廣告投資，並繼續支持市場上的領先品牌。 2023 財年，由於 MegaMex Foods 的業績顯著提高，附屬公司的股本和收益有所增加。 2023 財年營業收入為 11 億美元，調整後營業收入為 12 億美元。營業利益率和調整後營業利益率分別為 8.9% 和 9.8%。 2023財年的稅率為21.8%，略高於去年。 2024 財年的有效利率預計為 21% 至 23%。全年稀釋後每股淨利為 1.45 美元。不包括不利仲裁裁決非現金減損以及我們轉型和貨幣化計畫投資的影響。調整後攤薄每股淨利為 1.61 美元。

We remain committed to dividend growth, investing in our business and maintaining an investment grade rating. Our consistent cash flows of more than $1 billion in fiscal 2023 and a disciplined financial strategy directly support these commitments. In fiscal 2023, we returned a record $593 million to our shareholders in the form of dividends, including payment over 381st consecutive quarterly dividend effective November 15. We also recently announced an increase in the annual dividend of 3% and to $1.13 per share for fiscal 2024. This year will be a remarkable 58th consecutive year of dividend increases. We invested $270 million in capital projects during fiscal 2023, supporting growth for SPAM and for retail and food service Peperoni. We are investing $280 million in capital projects for fiscal 2024, which includes investments in our Barron facility, investments supporting our transformation and the modernization initiative and to support high-demand planters items.

我們仍然致力於股息成長、投資於我們的業務並維持投資等級評級。我們在 2023 財年持續超過 10 億美元的現金流和嚴格的財務策略直接支持這些承諾。 2023 財年，我們以股息的形式向股東返還了創紀錄的5.93 億美元，其中包括自11 月15 日起連續支付超過381 個季度股息。我們最近還宣布將年度股息增加3%，將財政年度股息增加至每股1.13 美元。2024 年。今年將是股息連續第58年增長，引人注目。 2023 財年，我們在資本項目上投資了 2.7 億美元，支持 SPAM 以及零售和食品服務 Peperoni 的成長。我們將在 2024 財年投資 2.8 億美元用於資本項目，其中包括對 Barron 工廠的投資、支持我們轉型和現代化計劃的投資以及支持高需求花盆項目的投資。

While 2023, a was a challenging year for the company. Our strong financial position allowed us to continue sharing our successes, which included recognizing our team members for the 85th consecutive year through our annual profit-sharing program. We ended the year with $3.3 billion of debt and over $750 million in cash and short-term securities. We remain in line with our stated goal of 1.5 to 2x net debt to EBITDA.

2023年對公司來說是充滿挑戰的一年。我們強大的財務狀況使我們能夠繼續分享我們的成功，其中包括連續 85 年透過年度利潤分享計劃表彰我們的團隊成員。截至年底，我們的債務為 33 億美元，現金和短期證券超過 7.5 億美元。我們仍遵守 EBITDA 淨債務 1.5 至 2 倍的既定目標。

Before turning to our outlook, I would like to highlight the progress we made during the year reducing inventory. As we committed to earlier in the year, we achieved our days sales in inventory target of less than 60 days for the quarter and drove a sequential reduction in dollars of both finished goods and total inventory. Inventories finished the year at $1.7 billion, a decrease of $36 million from the beginning of the year. We enter fiscal 2024 with responsible levels of inventory to support and achieve our targeted fill rates with ample production capacity to grow the businesses. While Jim covered many of the puts and takes embedded in our fiscal 2024 outlook, I want to provide additional color around our investments in the business and assumptions on key raw material markets. We are investing for growth in fiscal 2024. Specifically, we will be investing in end-to-end planning capabilities, infrastructure and software to further our data and analytics capabilities, a modernization of our order-to-cash system and incremental head count to support the plan, buy, make and move work streams across our supply chain. We anticipate about 1/3 of the total investment to be recorded in fiscal 2024. About $0.08 EPS is expected to be onetime with the rest capitalized or included in the ongoing cost structure of the business.

在展望我們的前景之前，我想強調一下我們在這一年中在減少庫存方面取得的進展。正如我們今年稍早所承諾的那樣，我們實現了本季庫存天數銷售目標少於 60 天，並帶動了成品和總庫存的美元連續減少。年終庫存為 17 億美元，比年初減少 3,600 萬美元。進入 2024 財年，我們擁有合理的庫存水平，以支持並實現我們的目標填充率，並擁有充足的產能來發展業務。雖然吉姆涵蓋了我們 2024 財年展望中的許多看跌期權和看跌期權，但我想就我們的業務投資和對關鍵原材料市場的假設提供更多資訊。我們正在為2024 財年的成長進行投資。具體來說，我們將投資於端到端規劃能力、基礎設施和軟體，以進一步提高我們的數據和分析能力、訂單到現金系統的現代化以及增量人員數量，以實現支援整個供應鏈的計劃、購買、製造和移動工作流程。我們預計 2024 財年將記錄總投資的約 1/3。預計每股收益約為 0.08 美元，其餘部分將資本化或包含在業務的持續成本結構中。

Shifting to the cost environment, our fiscal 2024 outlook assumes pork input costs to be higher than last year and to remain above the 5-year average. The USDA is projecting modestly higher production and high exports in 2024. Additionally, cold storage levels [of pork] have trended lower year-over-year and compared to the historical averages, which we expect to be supportive of pork markets. Of note, these costs are expected to continue to be a headwind in fiscal 2024 as the industry cycles through lower supplies. Turkey sales and volumes continued to recover in the fourth quarter as we grew Turkey volumes in each of our segments. The investments behind our value-added Turkey portfolio and lean ground business are working with ground volume and dollar sales outpacing the category for the latest 4- and 13-week period.

轉向成本環境，我們對 2024 財年的展望假設豬肉投入成本將高於去年，並保持在 5 年平均以上。美國農業部預計 2024 年產量和出口量將小幅提高。此外，與歷史平均水平相比，[豬肉]冷藏水平呈逐年下降趨勢，我們預計這將支撐豬肉市場。值得注意的是，隨著行業供應量減少，這些成本預計將在 2024 財年繼續成為不利因素。隨著我們每個細分市場的土耳其銷量成長，土耳其銷量和銷量在第四季度繼續復甦。我們增值土耳其投資組合和精益地面業務背後的投資正在使地面銷售和美元銷售額在最近 4 週和 13 週內超過該類別。

Turkey markets continued to move lower during the fourth quarter, pressuring prices across our channels. We have assumed prices will remain depressed in our fiscal 2024 outlook. We do expect to partially offset these pricing headwinds with lower feed costs. HPA has reemerged again this fall, creating another unusual event affecting our vertically integrated supply chain. At the present time, we do not expect supply impacts to the degree we experienced in the first half of fiscal 2023. The situation remains fluid, and the risk of additional cases creates [a heightened] level of uncertainty in the outlook of our Turkey business.

土耳其市場在第四季繼續走低，對我們通路的價格造成壓力。我們預計 2024 財年的價格將繼續低迷。我們確實希望透過降低飼料成本來部分抵消這些定價阻力。 HPA 今年秋天再次出現，造成了另一個影響我們垂直整合供應鏈的不尋常事件。目前，我們預計供應影響不會達到 2023 財年上半年的程度。情況仍然不穩定，新增病例的風險給我們土耳其業務的前景帶來了[更高的]不確定性。

In closing, I too want to recognize the dedication and hard work of our 20,000 employees across our great company. In so many ways, our team rose to the challenges thrown at them, while continuing to deliver safe and trusted products to customers, consumers and operators. As Jim noted, I am to confirm that we officially our safest year in the history of the company, a testament to all team members who uphold the safety first culture and keep it at the forefront of our business. This is a key part of the continued success of the company, one that can never be taken lightly. At this time, I'll turn the call over to the operator for the question-and-answer portion of the call.

最後，我也想對我們偉大公司 20,000 名員工的奉獻和辛勤工作表示認可。我們的團隊在許多方面迎接了挑戰，同時繼續為客戶、消費者和營運商提供安全、值得信賴的產品。正如吉姆所說，我要確認，我們正式迎來了公司歷史上最安全的一年，這證明了所有團隊成員堅持安全第一的文化，並將其置於我們業務的最前沿。這是公司持續成功的關鍵部分，絕對不能掉以輕心。此時，我會將通話轉交給接線生進行通話的問答部分。

Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. (Operator Instructions) We have our first question coming from the line of Adam Samuelson from Goldman Sachs.

謝謝。女士們、先生們，我們現在開始問答環節。 （操作員說明）我們的第一個問題來自高盛的 Adam Samuelson。

So Jim, there's a tremendous amount of detail in the outlook. I was hoping first, if you could help maybe just frame it a little bit more clearly kind of the high and low end of the guidance range, which is quite wide and quite wide to the sales outlook, which is just fairly narrow. So help us first, maybe understand kind of what happens in the market, in the business, in the external environment that gets to the high end of the range. [Also] to the low end of the range, which would be a pretty meaningful step down in operating things relative to what you did in fiscal '23?

吉姆，展望中有大量細節。我首先希望，如果你能幫忙的話，也許可以更清楚地描述一下指導範圍的上限和下限，這個指導範圍相當寬，而且對銷售前景來說也相當寬，而銷售前景相當窄。因此，首先幫助我們，也許了解市場、業務、外部環境中發生的情況，達到範圍的高端。 [另外]到該範圍的低端，相對於您在 23 財年所做的事情，這將是一個非常有意義的營運步驟？

Yes. Thanks, Adam. I think the best place to start is to remember that, I mean, our underlying portfolio here is showing growth. And as we called out in the remarks, there is a significant downturn in the turkey business, especially in retail with the biggest impact we expect in Q1 and Q4. More specifically to your question about how we think about the range. The range is consistent with what we've had in the past. And we take into account all of our traditional assumptions. But as we think about what could move us higher, better-than-expected volume mix depending on what does happen with the Turkey market. We've got this fall outbreak that just continues to escalate. That can certainly have an impact going forward. The other part is, as we think about the work that's underway already for some of our savings initiatives, our ability to over deliver there.

是的。謝謝，亞當。我認為最好的起點是記住，我的意思是，我們的基礎投資組合正在顯示成長。正如我們在演講中指出的那樣，火雞業務大幅下滑，尤其是零售業，我們預計第一季和第四季受到的影響最大。更具體地說，是關於我們如何看待這個範圍的問題。該範圍與我們過去的範圍一致。我們考慮了所有傳統假設。但當我們思考什麼可以推動我們更高、好於預期的銷售組合時，這取決於土耳其市場的情況。今年秋季的疫情正在持續升級。這肯定會對未來產生影響。另一部分是，當我們考慮我們的一些儲蓄計劃已經正在進行的工作時，我們超額交付的能力。

On the flip side, the same holds true on Turkey markets, right? If we continue to see some of those declines, that would take us to the other side. And then I think the part that we're all watching very closely is what's happening with some of the macro issues. In our business, specifically, what's going to happen in our international business, China recovery. When we think about price elasticities in retail, how do those impact the business for 2024. And so those are the things that we're thinking about and watching. But again, when we roll this business up, we feel like we're in a good place that we've built in the right amount of risk when we think about the Turkey business, the right amount of growth in the underlying portfolio. Which from a retail perspective, absent Turkey, we're seeing growth across almost all of the retail verticals. Foodservice will continue with strong performance. And we do expect international to start to recover after Q1. So hopefully, that gives you a little bit more clarity on that range.

另一方面，土耳其市場也是如此，對吧？如果我們繼續看到其中一些下降，那將把我們帶到另一邊。然後我認為我們都在密切關注的部分是一些宏觀問題正在發生的情況。在我們的業務中，具體來說，我們的國際業務、中國的復甦將會發生什麼。當我們考慮零售業的價格彈性時，它們對 2024 年的業務有何影響。因此，這些都是我們正在考慮和關注的事情。但同樣，當我們擴大這項業務時，我們感覺我們處於一個良好的位置，當我們考慮土耳其業務時，我們已經建立了適當的風險，基礎投資組合的適當增長。從零售角度來看，除了土耳其之外，我們看到幾乎所有零售垂直領域都在成長。餐飲服務將持續保持強勁表現。我們確實預計國際市場將在第一季後開始復甦。希望這能讓您對該範圍有更清晰的了解。

That's helpful. And then maybe just touching on the pricing elasticity point because I think incremental pricing actions are going to prove to be increasingly uncommon in the food space moving into 2024. So any additional color or description on where those are in magnitude? Are they already in place in the market? And just to confirm that excluding Turkey, you think your retail volumes are growing in fiscal '24?

這很有幫助。然後也許只是觸及定價彈性點，因為我認為進入 2024 年，增量定價行動在食品領域將變得越來越不常見。那麼，關於這些幅度的任何其他顏色或描述嗎？它們已經推出市場了嗎？只是想確認一下，除了土耳其之外，您認為您的零售量在 24 財年會成長嗎？

Yes. The last question. Yes, our retail volumes, ex-turkey will grow in 2024 and I'm going to let Deanna who lives and breathes that retail pricing element. I'll let her provide some additional color.

是的。最後一個問題。是的，我們的零售量（不包括火雞）將在 2024 年成長，我將讓迪安娜（Deanna）享受零售定價元素。我會讓她提供一些額外的顏色。

Thanks, as we think about pricing, we've had a lot of pricing over the last 2 years. A lot of that pricing has been reactive. And as we sit here today, we are in a position to be thinking about it proactively. First of all, we'll be leveraging our modernized revenue growth management practices and really taking a robust look at our flagship and our rising brands, which are designed to drive higher growth. We're investing in those brands for growth. And as we think about those brands and their position in the category, we'll be thinking about the COGS and whether the commodity input those areas are suggesting an increase. We'll also be thinking about what is our long-term ambition and what are the needs for us to be able to invest into these brands to continue to grow. And so some of that will require some consideration in regards to pricing so that we can have additional dollars for trade as well as advertising and innovation.

謝謝，當我們考慮定價時，過去兩年我們進行了許多定價。其中很多定價都是被動的。當我們今天坐在這裡時，我們能夠積極地思考這個問題。首先，我們將利用現代化的收入成長管理實踐，並真正認真審視我們的旗艦產品和新興品牌，這些品牌旨在推動更高的成長。我們正在投資這些品牌以實現成長。當我們考慮這些品牌及其在該類別中的地位時，我們將考慮銷貨成本以及這些領域的商品投入是否表明會增加。我們還將思考我們的長期目標是什麼，以及我們能夠投資這些品牌以繼續成長的需求是什麼。因此，其中一些需要在定價方面進行一些考慮，以便我們可以有更多的資金用於貿易以及廣告和創新。

As we think about elasticities, elasticities in our mind and what we're seeing are back to the pre COVID level. And so it's important that we take those elasticities very seriously because they are moving and moving pretty quickly. The other factors that we're thinking about is our position in the category. And definitely, at this point, we'll be more targeted and surgical about our reaction. And then my final thing is it doesn't have to be priced as well. There's obviously trade and trade prior to COVID again was pretty -- there's a lot of categories that are pretty inelastic. And so there are dollars to be considered from a trade perspective that we can redirect those dollars into other tactics that will enable us to grow the business.

當我們思考彈性時，我們頭腦中的彈性以及我們所看到的都回到了新冠疫情之前的水平。因此，我們必須非常認真地對待這些彈性，因為它們正在快速變化。我們正在考慮的其他因素是我們在該類別中的地位。當然，在這一點上，我們的反應將會更有針對性和更精準。然後我的最後一件事是它也不必定價。顯然，在新冠疫情爆發之前，貿易情況再次相當不錯——有很多類別非常缺乏彈性。因此，從貿易角度來看，我們可以將這些資金轉向其他策略，使我們能夠發展業務。

Our next question comes from the line of Rupesh Parikh from Oppenheimer.

我們的下一個問題來自奧本海默的 Rupesh Parikh。

So Jim, I just want to go back to comments on -- you talked about slowing consumer demand. So just more color on what changes you're seeing in consumer behavior lately?

吉姆，我只想回到關於您談到消費者需求放緩的評論。那麼，請多說明您最近看到的消費者行為發生了哪些變化？

Yes. I mean, Rupesh, I think the elasticities that Deanna was talking about, we know that we're back to pre-2019 levels. So we have to be thoughtful about how -- what levers and how we're pulling them. When we think about pricing, when we think about promotion, when we think about advertising, making sure that we are connecting with that consumer to drive the demand. But I mean, we also understand the amount of pricing that's gone into all these categories over the last couple of years, and it's been very, very significant. And I don't believe that consumers have fully digested all of the pricing that has still come through. So I think it's a work in process. To Deanna's point about our positions in the category that's really, really important as we think about those #1 and #2 positions that we hold. But through all of it, I think, again, the key takeaway here is this underlying portfolio ex Turkey and retail, especially is planned to show volume growth in 2024.

是的。我的意思是，Rupesh，我認為 Deanna 所說的彈性，我們知道我們回到了 2019 年之前的水平。因此，我們必須考慮如何——使用什麼槓桿以及如何拉動它們。當我們考慮定價、促銷、廣告時，請確保我們與消費者建立聯繫以推動需求。但我的意思是，我們也了解過去幾年所有這些類別的定價量，而且非常非常重要。我不認為消費者已經完全消化了仍然存在的所有定價。所以我認為這是一項正在進行的工作。對於迪安娜（Deanna）關於我們在該類別中的地位的觀點來說，當我們考慮我們所持有的第一和第二位置時，這一點非常非常重要。但透過這一切，我再次認為，這裡的關鍵要點是除土耳其和零售之外的基礎投資組合，特別是計劃在 2024 年顯示銷售成長。

Okay. Great. And then maybe just one follow-up question. So if you look at the environment for the coming year, how are you thinking about the promotional backdrop and competitive backdrop, do you think that evolves from here?

好的。偉大的。然後也許只是一個後續問題。那麼，如果你看看來年的環境，你如何看待促銷背景和競爭背景，你認為這會從現在開始發展嗎？

Yes. Rupesh, I am going to let Deanna maybe elaborate on that a little more consistent with what you said, the first time. So why don't you go ahead, Deanna?

是的。 Rupesh，我會讓 Deanna 詳細說明這一點，與您第一次所說的更加一致。那你為什麼不繼續呢，迪安娜？

It's really category by category. We've got areas of the business that I'll say are somewhat consistent with where the promotional activity has been. We have other areas and other categories where it has increased. So think of lunch meat, think of chicken, poultry areas, we're seeing more aggressive pricing and promotion activity, which is a little counterintuitive. When we think about it holistically though, from a promotional standpoint, there's an opportunity to reset promotions. To ensure that we have the most effective promotions for the consumer, for the customer and for our brands and business. And so that's really the evolution of our revenue growth management and our pricing teams working hand-in-hand with our customers and customer teams -- is really ensuring that we have the best and most productive promotions out there is that's really what's going to be impactful to helping drive the business for growth and not just continue to dissolve base business. and lower the category, both in volume and dollars.

確實是分門別類的。我想說，我們的業務領域與促銷活動的領域有些一致。我們還有其他領域和其他類別的成長。因此，想想午餐肉、雞肉、家禽領域，我們看到更激進的定價和促銷活動，這有點違反直覺。不過，當我們從整體上考慮時，從促銷的角度來看，有機會重新設定促銷活動。確保我們為消費者、客戶以及我們的品牌和業務提供最有效的促銷活動。因此，這確實是我們收入成長管理和定價團隊與客戶和客戶團隊攜手合作的演變——真正確保我們擁有最好、最有成效的促銷活動，這才是真正的結果有助於推動業務成長，而不僅僅是繼續溶解基礎業務。並降低該類別的數量和金額。

We have our next question coming from the line of Peter Galbo from Bank of America.

我們的下一個問題來自美國銀行的 Peter Galbo。

Great. Maybe just one quick one clarification. Just did you give a net interest expense guide at all on the quarter -- I'm sorry, for the year, I think you have a bond that's going to come due in June that will need to maybe be [refi]. So maybe if you can just elaborate on that.

偉大的。也許只是快速澄清一下。您剛剛提供了本季度的淨利息支出指南嗎？很抱歉，今年，我認為您有一筆將於 6 月到期的債券，可能需要[重新融資]。也許您可以詳細說明一下。

Peter. So yes, we do have that's coming due. We have $950 million coming due here early June. We did not give guidance on the interest numbers. We certainly are working through and looking at options to pay down that debt. We haven't landed in a spot yet. What I can tell you, though, we have definitely baked in higher interest expense in the numbers that we have guided to here for the year.

彼得.所以，是的，我們確實有到期日。六月初，我們還有 9.5 億美元到期。我們沒有就利息數字提供指導。我們當然正在研究並尋找償還債務的選擇。我們還沒有降落在一個地方。不過，我可以告訴你的是，在我們今年指導的數字中，我們肯定會增加利息支出。

Okay. Got it. That's helpful. And then just maybe, Jim, in the conversation around elasticity, I guess what's been more notable is just the impact from kind of the reduced Snap payments maybe took a bit more time to start impacting volumes than others expected. Can you just talk about what you're seeing real time? I would think at least some exposure there. But what kind of a [SNAP] impact has been? And then maybe when you think it starts to get better or even modestly flip to a tailwind.

好的。知道了。這很有幫助。然後，吉姆，在關於彈性的對話中，我想更值得注意的是 Snap 支付減少所產生的影響可能需要比其他人預期更多的時間才能開始影響交易量。您能談談您即時看到的情況嗎？我認為至少在那裡有一些曝光。但 [SNAP] 的影響是怎麼樣的呢？然後也許當你認為情況開始好轉，甚至適度地轉向順風。

Yes. Great. Thanks, Peter. I mean I think the macro discussion, it has been filled with a lot of different information. When we think about some of the economic uncertainties that are showing up in these elasticities. We have talked about the reduction in Snap. Obviously, we're talking about interest rates being high and as rates go up, that's taking more people's money, money, student loan mortgages which all of that can lead to a depleted or a lower position. And so what's interesting for us is, I think, again, as we go through this category by category, we're seeing different behavior in these different categories. And so we have some premium categories that continue to do very well.

是的。偉大的。謝謝，彼得。我的意思是，我認為宏觀討論中充滿了很多不同的訊息。當我們考慮這些彈性中出現的一些經濟不確定性。我們已經談到了 Snap 的減少。顯然，我們談論的是高利率，隨著利率上升，這會佔用更多人的錢、錢、學生貸款抵押貸款，所有這些都可能導致部位耗盡或降低。因此，我認為，對我們來說有趣的是，當我們逐個類別地瀏覽此類別時，我們會看到這些不同類別中的不同行為。因此，我們有一些優質類別繼續表現出色。

To your point, I think in the short term, some of the center store items have been pressured and there could be a link back to some of the reduced Snap or other the macroeconomic issues. I think, again, to Deanna's point, our job is to be able to restore that growth. And how do we do that by connecting with the consumer, reminding them of the value of our portfolio and making sure that we're pulling the right levers, whether it's promotion or advertising. Those are the things that we do. And so we appreciate and understand that there might be some short-term impact. But we also know that we know how to navigate through this situation. And then I would -- I don't know, Deanna, if there's anything that you would want to add to that conversation.

就你的觀點而言，我認為短期內，中心商店的一些商品受到了壓力，並且可能與一些減少的 Snap 或其他宏觀經濟問題有關。我再次認為，就迪安娜的觀點而言，我們的工作就是能夠恢復這種成長。我們如何透過與消費者建立聯繫、提醒他們我們產品組合的價值並確保我們使用正確的槓桿（無論是促銷還是廣告）來做到這一點。這些就是我們所做的事情。因此，我們理解並理解這可能會產生一些短期影響。但我們也知道我們知道如何應對這種情況。然後我會——我不知道，迪安娜，你是否想在這次談話中添加任何內容。

The only thing I would add is it's very fluid. We're watching it all very closely. I was talking to Jim and just since yesterday, and I commented that I didn't used to keep such a close eye on the 4-week turns. But in this environment, 4 weeks actually are signaling things. An example is last 4 weeks in our convenient meals and protein category showed an improvement over what we saw in the fourth quarter, in some of those areas where we felt that there was pull back from the consumer. And so we're keeping a close watch really on all our categories, our consumer and working closely with our customers to navigate the macro environment that the consumer is facing.

我唯一要補充的是它非常流暢。我們正在非常密切地關注這一切。就在昨天，我正在和吉姆交談，我評論說我以前並沒有如此密切地關注 4 週的變化。但在這種環境下，4 週實際上已經發出了信號。一個例子是，過去 4 週我們的方便餐和蛋白質類別顯示出比我們在第四季度看到的情況有所改善，在一些我們認為消費者退縮的領域。因此，我們正在密切關注我們的所有類別、我們的消費者，並與我們的客戶密切合作，以應對消費者面臨的宏觀環境。

We have our next question coming from the line of Michael Lavery from Piper Sandler.

我們的下一個問題來自 Piper Sandler 的 Michael Lavery。

Just wanted to touch on Turkey again. It's obviously unusual seasonally to have some of the pricing pressure that you're seeing but it seems maybe even a little bit more unexpected coupled with the resurgence in the avian flu. I guess what does it take for pricing to recover. And then you had mentioned how you've been factoring in the price pressure in your outlook. I guess maybe can you give us any sense of what conservatism is there? Or if pricing were to improve, how much of an impact that could have? And maybe just to try to put it in some context.

只是想再談談土耳其。您所看到的價格壓力在季節性上顯然是不尋常的，但加上禽流感的死灰復燃，這似乎更出乎意料。我想價格需要什麼才能恢復。然後您提到您在展望中如何考慮價格壓力。我想也許你能給我們一些什麼是保守主義的感覺嗎？或者如果定價提高，會產生多大的影響？也許只是嘗試將其放在某種背景下。

Yes. I think, Michael, the question you're asking about what's it going to take I think the turkey supply situation is in a unique situation right now because we had supply coming back. And obviously, as supply was coming back, there was a lot of work being done to restore the demand side of the business. And I don't think those were yet perfectly aligned. So I do believe, from a supply side, as we sit here today, the supply is adequate to support the business. Now how long does it support the business? How long do some of these outbreaks last? I think that -- those are the uncertainties and the volatility that we talk about in this outlook. And so as we do think about what we've built in to our outlook, we expect the Turkey headwind across the enterprise to be about $0.10. And a big part of that is it's a high-volume business when we think about the whole turkey business. Again, you go from all-time high to dropping below a 5-year average. And then where does it go from here? And so as we sit and as we sat and work through it, that was our estimate in terms of the impact of the business.

是的。我想，邁克爾，你問的問題是要做什麼，我認為火雞供應情況現在處於獨特的情況，因為我們的供應回來了。顯然，隨著供應的恢復，我們正在做很多工作來恢復業務的需求面。我認為這些還沒有完全一致。因此，我確實相信，從供應方面來看，當我們今天坐在這裡時，供應足以支持業務。現在它能支援業務多久？其中一些疫情會持續多久？我認為，這些就是我們在展望中談論的不確定性和波動性。因此，當我們確實考慮我們的前景時，我們預計整個企業的土耳其阻力約為 0.10 美元。其中很大一部分原因是，當我們考慮整個火雞業務時，這是一項大量的業務。再次從歷史最高點跌至五年平均以下。然後它會去哪裡？因此，當我們坐下來解決這個問題時，這就是我們對業務影響的估計。

Now I think the other part of this to remember is our job is to continue to set this business up for success. And so we continue to talk about rightsizing and optimizing this business portfolio so that it does become more demand-driven, more value added. And think about lean ground turkey, the work that we're doing on the foodservice side of the business work in the K-12 channel. So I mean all of that factors into our outlook as we're thinking about that in 2024.

現在我認為要記住的另一部分是我們的工作是繼續讓這項業務成功。因此，我們繼續討論調整和最佳化該業務組合，使其變得更加受需求驅動、更具附加價值。想想瘦肉火雞，我們在 K-12 渠道的業務工作的餐飲服務方面所做的工作。所以我的意思是，當我們考慮 2024 年時，所有這些因素都會影響我們的前景。

Okay. That's really helpful color. And just a follow-up on the kind of 3-year plan and I guess two parts. So apologies if I might have missed this, but could you quantify what the expected savings level is over the 3 years? And then of the $250 million spend you called out, can you give a split of what would be CapEx versus operating?

好的。這真是有用的顏色。這只是三年計畫的後續行動，我想分成兩個部分。如果我可能錯過了這一點，我很抱歉，但是您能量化一下 3 年內的預期儲蓄水平嗎？然後，在您提出的 2.5 億美元支出中，您能否劃分資本支出與營運支出？

Yes. So the last question, Michael, we'll probably have David, follow up on the split for you, and he can have those conversations. I do want to just take a step back here and just review the work that we've been doing and the path that we've been on and why this is so important to us. We go back to the one supply chain initiative back in 2018, that was more structural to provide consistency in one look across the entire enterprise. And we followed that up with Project Orion which was to update, modernize our foundational ERP system across our support areas, HR, finance and accounting, and we wanted to get to supply chain, which clearly we never got to because of COVID. And so as now we're talking about this transformation and modernization, in a lot of ways, it's a continuation of really finishing the work that we've started. And so the order to cash, end-to-end planning, those things were always in scope. But as we've progressed what we've really been able to do is enhance the work that we want to do. And so I think portfolio optimization is something that initially was at in scope for us. So that is an enhancement. And so it is a continuation, in some ways, it's an enhancement and it's an acceleration. So we've been doing a lot of this work and our goal now is to finish the job. And Jacinth so any of the financial numbers that you want to add?

是的。所以最後一個問題，邁克爾，我們可能會讓大衛為你跟進分裂的情況，他可以進行這些對話。我確實想退後一步，回顧一下我們一直在做的工作和我們所走的道路，以及為什麼這對我們如此重要。我們回到 2018 年的單一供應鏈計劃，該計劃更具結構性，可以在整個企業中提供統一的外觀。我們隨後推出了Orion 項目，該項目旨在對我們的支援領域、人力資源、財務和會計領域的基礎ERP 系統進行更新和現代化，我們希望進入供應鏈領域，但顯然由於新冠肺炎疫情，我們從未做到這一點。因此，正如我們現在所談論的這種轉型和現代化，從許多方面來說，它是真正完成我們已經開始的工作的延續。因此，從訂單到現金、端到端規劃，這些事情始終在範圍內。但隨著我們的進步，我們真正能夠做的是加強我們想做的工作。因此，我認為投資組合優化最初是我們範圍內的事情。所以這是一個增強。所以它是一種延續，在某些方面，它是一種增強，它是一種加速。我們已經做了很多工作，現在的目標是完成這項工作。 Jacinth 那麼您想新增哪些財務數據？

Yes. No, certainly. So to add to what Jim has just stated here, we laid out a plan that gets us to $250 million over the 3 years in operating profit. And so the way we are thinking about that, there is $200 million squarely focused on the supply chain component, which is around the plan by make, move pieces of the work streams that we're working through, and that will show up in a couple of different places. Pieces may show up in COGS and other pieces definitely will show up through the -- and ultimately through the margin line, but really driving margin expansion for the business and getting us back our margin profile and growth rate for the company. Then there is another EUR 25 million of that is around the strategic value capture of the business. And then more than $25 million or so is then the underlying core business that will grow over that period of time. So all in all, over $250 million of expansion from operating margin perspective, and it doesn't stop and we have that going out to 2026 is how we've messaged it. But what we should think about is that it is -- doesn't just stop there, that the benefits will carry on beyond 2026.

是的。不，當然。因此，為了補充吉姆剛才所說的內容，我們制定了一項計劃，使我們在 3 年內實現營業利潤 2.5 億美元。因此，我們考慮這個問題的方式是，有 2 億美元直接專注於供應鏈組件，它圍繞著製造計劃，移動我們正在處理的工作流程的各個部分，這將顯示在幾個不同的地方。部分可能會出現在銷貨成本中，而其他部分肯定會通過——並最終通過利潤線顯示出來，但真正推動了業務的利潤擴張，並讓我們恢復了公司的利潤狀況和增長率。另外還有 2,500 萬歐元用於企業的策略價值取得。然後超過 2500 萬美元左右的基礎核心業務將在這段時間內成長。總而言之，從營業利潤率的角度來看，擴張超過 2.5 億美元，而且這種擴張不會停止，我們傳達的訊息是到 2026 年。但我們應該考慮的是，這些好處並不僅限於此，而且將持續到 2026 年後。

We have our next question coming from the line of Ben Bienvenu from Stephens Inc.

我們的下一個問題來自 Stephens Inc. 的 Ben Bienvenu。

Yes. Thanks very much. I want to ask about the International segment. You talked about the weakness being more pronounced in the first quarter and then that you expected to get better after that. Just curious about your assumptions that go into your confidence level around that business improving beyond the first quarter.

是的。非常感謝。我想問一下國際部分的情況。您談到第一季的疲軟狀況更加明顯，然後您預計此後會有所改善。只是好奇您對第一季之後業務改善的信心水平的假設。

Yes. There's a couple of things at play there that have us confident beyond Q1. The first thing is when we talk about some of the impact of the price elasticities on our branded business, we've done a lot of work to again, pull the right levers to drive demand, and we've been able to have a positive impact. And so we do believe that we'll see the branded export business pick up beyond Q1, and that will carry us through the balance of the year. The second part is this improvement in our business in China. And so it's early in 2024 but we are seeing some moderate improvement across foodservice and retail. But we're expecting that to accelerate as we move throughout the year. And then the third thing really is there was a commodity impact to international this year. And so as we continue to build demand on Turkey, and other pork items elsewhere that's less that international will be exporting, at lower margins. So we expect to see that improvement also as we progress throughout the year. So really, those three factors are what are leading to us to have that optimistic outlook beyond Q1.

是的。有幾件事讓我們對第一季之後充滿信心。首先，當我們談論價格彈性對我們品牌業務的一些影響時，我們已經做了很多工作，再次拉動正確的槓桿來推動需求，並且我們已經能夠取得積極的結果影響。因此，我們確實相信，我們將看到品牌出口業務在第一季之後回升，這將有助於我們度過今年餘下的時間。第二部分是我們在中國業務的進步。現在雖然是 2024 年初，但我們看到餐飲服務和零售業出現了一些適度的改善。但我們預計隨著全年的發展，這種情況會加速。第三件事是今年對國際大宗商品產生了影響。因此，隨著我們繼續增加對土耳其和其他地方豬肉產品的需求，國際出口量將減少，利潤率也會降低。因此，隨著我們全年的進步，我們預計也會看到這種改善。事實上，這三個因素使我們對第一季之後的前景持樂觀態度。

Okay. Great. My second question is related to FY '25. You carved out the and quantified the $0.08 of nonrecurring costs in 2024, would you expect to be back to GAAP guidance in FY '25?

好的。偉大的。我的第二個問題與 25 財年有關。您計算並量化了 2024 年 0.08 美元的非經常性成本，您預計在 25 財年回到 GAAP 指引嗎？

So the short answer to that is no. So over this period, we're executing the transformation modernization, which we have at the moment booked until 2026. We will be in the non-GAAP reporting methodology during that period of time, primarily to just really give good visibility to the underlying core performance of our business. And so that there is no confusion there and then to be able to bucketize the savings that's been driven by the transformation modernization.

所以簡短的回答是否定的。因此，在此期間，我們正在執行轉型現代化，目前我們已預訂到 2026 年。在此期間，我們將採用非 GAAP 報告方法，主要是為了真正為底層核心提供良好的可見性我們的業務表現。這樣就不會出現混亂，能夠將轉型現代化帶來的節省進行分類。

We have our next question comes from the line of Benjamin Theurer from Barclays.

我們的下一個問題來自巴克萊銀行的本傑明·特雷爾（Benjamin Theurer）。

The first one is on food service actually. And just to understand, how you can potentially further accelerate this business given the strength you had throughout the year and begin in the quarter. It's becoming really important piece of the equation representing almost 50% of this year's profit. So just wanted to understand what are like the opportunities you're seeing within food service to really keep that growth momentum into 2024 as it helps offsetting some of the pressure in the retail channels. That would be my first question.

第一個其實是餐飲服務。只是為了了解，鑑於您全年和本季開始的實力，您如何能夠進一步加速這項業務。它正變得非常重要，佔今年利潤的近 50%。因此，我只是想了解您在食品服務領域看到的機會，以真正將成長勢頭保持到 2024 年，因為它有助於抵消零售通路的一些壓力。這是我的第一個問題。

Yes. Great. The biggest thing as we headed to '24 for food service, a lot of the industry indicators are really stable and in some cases, improving. And so we think that for us, obviously allows us to continue to run our business the way we always have because it's well positioned, and I know it's a bit repetitive. But when we talk about the portfolio that we've designed to solve for operator challenges and limited labor, I mean, that continues to be in our wheelhouse and in our sweet spot. But then also thinking about innovation at our Investor Day, we've talked about the innovation that the team is working on and introducing to the marketplace, continuing to find different categories to make a difference for those operators. The other thing is we've talked about the value-added capacity that we have in key categories such as bacon, pizza toppings and Turkey. And then this continued evolution of the work that they're doing in C-stores with the addition of planters and a more retail-focused portfolio there. And all of that is complemented by leaning into a world-class culinary team, innovation team and really this food forward mentality, if you will. So again, when you think about all the different pieces that can impact foodservice, it really does remain well positioned for growth in fiscal year 2024.

是的。偉大的。在食品服務業邁入 24 世紀之際，最重要的事情是，許多行業指標都非常穩定，在某些情況下甚至還在改善。因此，我們認為，對我們來說，這顯然使我們能夠繼續以我們一貫的方式經營我們的業務，因為它定位良好，而且我知道這有點重複。但當我們談論我們為解決操作員挑戰和有限勞動力而設計的產品組合時，我的意思是，這仍然是我們的駕駛室和最佳位置。但在我們的投資者日上也考慮了創新，我們討論了團隊正在研究並向市場推出的創新，繼續尋找不同的類別來為這些運營商帶來改變。另一件事是我們已經討論了我們在培根、披薩配料和火雞等關鍵類別中的增值能力。然後，他們在便利商店所做的工作不斷演變，增加了花盆和更注重零售的產品組合。所有這一切都需要依靠世界一流的烹飪團隊、創新團隊以及真正的食品前沿心態（如果你願意的話）來補充。因此，當您考慮可能影響餐飲服務的所有不同因素時，您會發現餐飲服務確實在 2024 財年保持了良好的成長動能。

Okay. Perfect. And then a quick follow-up for Jacinth on the guidance. Can you give us or share your expectations as it relates one, CapEx and two, just corporate expense in fiscal '24. How we should think about these two items?

好的。完美的。然後對 Jacinth 的指導進行快速跟進。您能否向我們提供或分享您的期望，因為它涉及一是資本支出，二是 24 財年的公司支出。我們該如何看待這兩項？

Yes. So from a CapEx perspective, CapEx will be in line with prior year, and we're expecting it to be around the $280 million mark. With some critical projects, including growth for planters, our transformation modernization initiative that we are undertaking will be some of the core tenants of the major projects that we'll undertake for 2024.

是的。因此，從資本支出的角度來看，資本支出將與去年持平，我們預計將在 2.8 億美元左右。對於一些關鍵項目，包括種植園的成長，我們正在實施的轉型現代化計劃將成為我們將在 2024 年實施的主要項目的一些核心租戶。

I will just interrupt, Ben. I think we did talk about this in our Investor Day is that we've got, as I just mentioned, for foodservice, available capacity. So some of the CapEx investments that we've been making over the last several years, we won't have to make this year. And so while the dollar amount remains the same. The mix of projects in there will be different.

我就打斷一下，本。我認為我們在投資者日確實討論過這一點，正如我剛才提到的，我們擁有餐飲服務的可用能力。因此，我們過去幾年一直在進行的一些資本支出投資，今年我們不必進行。因此，儘管美元金額保持不變。那裡的項目組合將會有所不同。

Yes. No, that's exactly right. And I think as we think about how we are spending those dollars, I know year-over-year, and I've gotten the question before in terms of the expectation that we'll spend more. And to Jim's point, because we have made such an investment over the past few years, we do have that capacity and now those assets that are currently working for us. From a corporate expense perspective, I mean, that will be a little bit -- that would be increase definitely year-over-year. When we think about the labor agreement that we just entered into, we're continuing to invest as well in our people. So that will increase our SG&A. And then from just overall benefits and compensation also takes us up year-over-year.

是的。不，完全正確。我認為，當我們考慮如何花費這些美元時，我知道年復一年，而且我之前已經收到過關於我們將花費更多資金的預期的問題。對於吉姆來說，因為我們在過去幾年中進行了這樣的投資，所以我們確實擁有這種能力，現在這些資產正在為我們工作。我的意思是，從企業支出的角度來看，這將是一點點——肯定會逐年增加。當我們想到我們剛剛簽訂的勞工協議時，我們也在繼續對我們的員工進行投資。這將增加我們的 SG&A。從整體福利和薪資來看，我們的業績也較去年同期成長。

And the work that we're going to do to support our brands been when we think about advertising and in continuing to support the brands in the marketplace that remains high, high priority for us.

當我們考慮廣告並繼續支持市場上的品牌時，我們將要做的支持我們品牌的工作對我們來說仍然是非常非常重要的。

Thank you. This concludes our Q&A session. I'd now like to turn the call back over to Mr. Jim Snee for final closing comments.

謝謝。我們的問答環節到此結束。現在我想將電話轉回吉姆·斯尼先生以徵求最後的總結意見。

Thank you, and I want to thank all of you for joining us today. And while 2023 didn't play out quite like we had planned, there were a lot of great accomplishments that will set this company up for future success. I remain confident we have right strategy, brands, people and culture to deliver growth well into the future. Again, thank you for joining us today, and I hope you all have a happy holiday season.

謝謝大家，我要感謝大家今天加入我們。雖然 2023 年的表現與我們計劃的不太一樣，但我們取得了許多偉大的成就，將為公司未來的成功奠定基礎。我仍然相信，我們擁有正確的策略、品牌、人員和文化，可以在未來實現良好的成長。再次感謝您今天加入我們，祝大家節日快樂。

Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines. Have a lovely day.

女士們、先生們，今天的電話會議到此結束。我們感謝您的參與，並請您斷開線路。祝你愉快。