Guidance on Organic Sales Growth
Q: Why has your fiscal '25 organic sales growth guidance range moved slightly below initial expectations?
A: Our guidance reflects a volume-driven plan with little, if any, price increases. The low end is framed by continued weakness in China consumer confidence, expecting only slight to gradual recovery. Additionally, we see softness in QSR channels, particularly in EMEA. The high end is supported by strong consumer volumes in the Americas and EMEA. Overall, our outlook remains consistent with what we shared at Investor Day. "

Margin Expansion Outlook
Q: How should we think about margin expansion between your two segments in fiscal '25?
A: We're pleased with our gross margin expansion of 90 basis points in 2024 and expect an additional 50 to 100 basis points in 2025. This will be driven by CCI and productivity savings, technology investments, and portfolio mix. We anticipate more gross margin improvement from the Flavor Solutions segment as we shift to higher-margin categories like flavors and branded foodservice. Our operating margin in Flavor Solutions improved by 140 basis points in 2024, and we're committed to reaching 14.5% by 2028. "

Impact of Investments on Guidance
Q: How do your planned investments in technology affect your fiscal '25 guidance?
A: We'll continue to invest in technology, including our ERP implementation and new capabilities like AI and machine learning. These investments impacted SG&A by 40 basis points in 2024 and will continue into 2025. Over time, this will drive CCI and productivity savings, supporting our broader guidance for the year. "

China Sales Expectations
Q: Could you provide specifics on your expectations for China within your guidance range?
A: We're factoring in the potential for China not meeting expectations, as we've seen in '23 and '24. The low end of our guidance accounts for continued weakness in China consumer confidence, with only slight to gradual recovery expected. We're taking a prudent view given the dynamic environment. "

Cash Flow and Inventory Decisions
Q: How did strategic inventory decisions impact cash flow in 2024, and what about 2025?
A: Our cash flow remained strong at $922 million in 2024. We made strategic decisions to increase inventory by forward-buying commodities to protect service levels and lock in favorable costs. While difficult to predict for 2025, such decisions are part of our standard approach to managing input costs. "

Volume Growth Sustainability
Q: Given strong Q4 volumes, do you expect this momentum to continue into fiscal '25?
A: Yes, we're continuing to drive top-line momentum from 2024 into 2025 with volume growth across both segments. We anticipate consistent top-line growth throughout the year, supported by ongoing investments in brand marketing and maintaining price gap management strategies. " "

Flavor Solutions Segment Shift
Q: How quickly is your pivot to faster-growing, innovative customers in Flavor Solutions happening?
A: We're seeing faster performance in categories like snacks, granola, crackers, soups and broths, beverages, and performance nutrition. While overall volumes were flattish in Q4, we're gaining share and driving growth with these customers. Growth in branded foodservice has also been healthy, and we expect this to continue. "

JV Income and Currency Impact
Q: How is currency affecting your JV income, and is the underlying business still growing?
A: The underlying performance of our JV in Mexico is strong, driving significant volume and profitability. However, a 20% devaluation of the Mexican peso against the dollar is impacting translated results. Excluding currency headwinds, the business is robust and growing. "

Price Gap Management
Q: How much more price gap management investment is needed going into Q1 and fiscal '25?
A: We'll maintain the same level of price gap investment as in 2024. There's no significant step-up; instead, we're maintaining our baseline to support brand growth and volume. We continuously evaluate the return on these investments to ensure effectiveness. "

Consumer Trends and Outlook
Q: What is your outlook on consumer behavior and its impact on your business in 2025?
A: We expect continued demand for flavor as consumers focus on cooking at home and healthier eating. Value remains important, especially for lower-income consumers seeking affordability globally. Our portfolio is well-positioned to meet these needs, supporting our performance in the evolving environment. "

Brand Marketing Plans
Q: How will your brand marketing spending change in fiscal '25?
A: We'll continue investing at high single-digit increases, similar to 2024, spread evenly across all quarters. We'll allocate spending strategically across our portfolio, increasing investment where we see the strongest returns, and continue supporting brands like Frank's RedHot while focusing more on other brands. "

Earnings Cadence Expectations
Q: How should we think about the cadence of earnings relative to your annual growth ranges?
A: We expect consistent top-line growth throughout the year, with volume growth in both segments starting from Q1. Operating profit in Q1 may be slightly down to flat due to pricing overlaps and a shift in compensation expenses. Gross margin improvement is anticipated from Q2 to Q4. "

Regulatory Changes and Reformulation
Q: How are you positioned to capitalize on industry reformulations due to potential additive bans?
A: We're actively involved in reformulations and product improvements, assisting customers with removing artificial colors, reducing sodium, and increasing clean ingredients. Our expertise positions us well to support customers through any regulatory changes, driving innovation in the industry. "