TreeHouse Foods (THS) investor relations material

Market environment and private label trends

• Consumer demand in grocery is soft, with overall consumption down and private label volumes flat or slightly up in select categories.

• Retailers are increasingly focused on optimizing private label assortments and penny profit, driven by competition from discount retailers.

• Private label share is growing slowly, but in a shrinking market, resulting in share gains within a smaller overall pie.

• Retailers are engaging in more targeted, category management-driven private label strategies rather than broad expansions.

Portfolio optimization and operational focus

• Strategic focus has shifted to fewer, deeper categories with strong consumer trends, such as crackers, broth, and refrigerated dough.

• Divestitures and acquisitions, like Harris Teas, have enabled deeper category expertise and improved capital allocation.

• Building scale in select categories has allowed for more multiyear contracts and a resilient supply chain, making the company a preferred supplier.

• Capital investments have addressed past supply chain disruptions, with improvements in people, process, and systems now in place.

Financial strategy and cost management

• Emphasis has shifted from top-line growth to profitability and cash flow, targeting $250M in gross cost savings through 2027.

• Cost savings are driven by procurement efficiencies, plant consolidations, and SG&A reductions, enabled by improved ERP systems.

• EBITDA growth is expected to continue for several years, even in a flat volume environment.

• Guidance remains conservative due to market uncertainty, despite two consecutive quarters of EBITDA above guidance.