ConAgra Foods, Inc. (NYSE:CAG) Q1 2021 Earnings Conference Call - Final Transcript

Oct 01, 2020 • 09:30 am ET

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ConAgra Foods, Inc. (NYSE:CAG) Q1 2021 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good morning, everyone, and welcome to the Conagra Brands Fiscal '21 First Quarter Earnings Conference Call. [Operator Instructions]

At this time, I'd like to turn the conference call over to Brian Kearney, Investor Relations. Sir, please go ahead.

Executive
Brian Kearney

Good morning, everyone. Thanks for joining us.

I'll remind you that we will be making some forward-looking statements today. While we are making those statements in good faith, we do not have any guarantee about the results we will achieve. Descriptions of the risk factors are included in the documents we've filed with the SEC.

Also, we will be discussing some non-GAAP financial measures. References to adjusted items, including organic net sales, refer to measures that exclude items management believes impact the comparability for the period referenced. Please see the earnings release for additional information on our comparability items. The GAAP to non-GAAP reconciliations can be found in either the earnings press release or the earnings slides, both of which can be found in the Investor Relations section of our website, conagrabrands.com.

Finally, please note that we expect to report our second quarter earnings in early January this fiscal year. We will issue a press release with the specific details later this calendar year.

With that, I'll turn it over to Sean.

Executive
Sean Connolly

Thanks, Brian.

Good morning, everyone, and thank you for joining our first quarter fiscal 2021 earnings call. I hope that you and your families are continuing to stay safe and healthy.

Today, I'm going to unpack the quarter for you and then share our perspective on how the evolving consumer environment is shaping longer-term demand for our products. So let's get started.

Building upon our impressive momentum at the end of last year, we're off to a strong start in Q1. We exceeded our expectations and saw broad-based strength across the portfolio. We will detail today why we believe our business is well positioned to continue to deliver strong results, both in the near and long term. Transformation we've undertaken over the past five years by following our Conagra Way playbook to perpetually reshape our portfolio and capabilities for growth and better margins has proven critical in enabling us to respond to the changing dynamics in the current environment. Our modernized portfolio, commitment to innovate and agile culture have allowed us to respond to the increased consumer demand and changing preferences today and position us to deliver meaningful growth into the future.

Our robust performance has also helped us to get ahead of our expected deleveraging cadence. As Dave will detail later, we expect to reach our net leverage ratio target of 3.5 times to 3.6 times by the third quarter of fiscal 2021. Paying down debt has been a capital allocation priority in recent quarters, but you also know that we are committed, long-term, to a balanced capital allocation approach. Given our progress on deleveraging and because we remain confident in the long-term outlook for our business, our Board has increased our quarterly dividend by 29% to $1.10 on an