Good day, and welcome to the B&G Foods, Second Quarter 2016 Earnings Conference Call. Today's call is being recorded. You can access detailed financial information on the quarter in the company's earnings release issued today, which is available at bgfoods.com. Before the company begins its formal remarks, I need to remind everyone that part of the discussion today includes forward-looking statements. These statements are not guarantees of future performance and therefore, undue reliance should not be placed upon them. We refer all of you to the company's most recent annual report on Form 10-K and subsequent SEC filings for a more detailed discussion of the risks that could impact the company's future operating results and financial condition. The Company undertakes no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events, or otherwise. The company will also be making references on today's call to the non-GAAP financial measures, adjusted EBITDA, adjusted net income, adjusted diluted earnings per share, and base business net sales. Reconciliations of these financial measures to the most directly comparable GAAP financial measures are provided in today's earnings release. Tom Crimmins, the Company's CFO, will start the call by discussing the company's financial results for the quarter. Next, Bob Cantwell, the company's CEO, will discuss various factors that affected the company's results, selected business highlights, and his thoughts concerning the remainder of 2016. I'd now like to turn the conference over to Mr. Tom Crimmins. Tom.

Thank you, operator. Good afternoon, everyone, and thank you for joining us today. Net sales for the second quarter of 2016 increased 58.2% to $306.4 million, compared to $193.6 million in the second quarter of 2015. Net sales of Green Giant, acquired on November 2, 2015, and net sales of Mama Mary's, acquired on July 10, 2015, contributed $107.2 million and $8.9 million, respectively, to our net sales for the quarter. Base business net sales decreased 1.3% or $2.5 million. The decrease was attributable to a $1.6 million decrease in unit volume, combined with a net reduction in pricing and the unfavorable impact of foreign exchange. Gross profit increased 76.9% to $109.7 million in the second quarter, as compared to $62 million for the second quarter of 2015. Gross profit expressed as a percentage of net sales increased 380 basis points to 35.8% for the second quarter of 2016, from 32% for the second quarter of 2015. The increase in gross profit percentage was primarily driven by the acquisition of Green Giant, which benefited from lower-than-anticipated trade expense, as well as input costs, particularly from our Irapuato, Mexico manufacturing facility, combined with the favorable impact of the translation of the Mexican peso to U.S. dollars, as well as greater-than-anticipated synergies with our base business. Gross profit percentage was positively impacted by the decreased cost for certain commodities and packaging, which we anticipate will yield $7 million in total savings in 2016, as well as distribution savings and improved product mix, partially offset by the unfavorable impact decreased base business volume had on cost absorption, and net reduction in base business pricing, and the impact of the write-off of Rickland Orchards inventory in connection with our decision to discontinue the brand. Selling, general, and administrative expenses increased 76.5% to $33.9 million,…

Thank you, Tom, and good afternoon, everyone. We are extremely pleased with our results this quarter and what we have accomplished year to date in 2016, particularly our profitability with adjusted EBTIDA margins of 27.7% for the quarter and 26.5% for the year-to-date period. We continue to be very optimistic about the second half of the year, as we prepare to launch our new Green Giant products and our new marketing campaign to awaken the Green Giant. As Tom highlighted, our base business net sales were down $2.5 million or 1.3% quarter over quarter. The decrease was primarily driven by two brands; TrueNorth and New York Style, which together decreased by $3.4 million. In the aggregate, all our other base business brands produced a net sales increase of $0.9 million. Our goal in 2016 with TrueNorth is to begin to recover sales volume that the brand lost primarily in 2015, as a result of historically high almond prices which drove our retail price for the brand up to a level that consumers resisted. As many of you already know, nut prices have since declined fairly significantly, which has provided us the much-needed flexibility to reduce pricing. However, certain major customers initially resisted lowering their retail pricing, and, as a result, we continued seeing softness in the brand in the first half of 2016. The good news is that our largest customer just recently rolled back pricing, and, as a result, we anticipate a slow but steady uplift in sales volume for the brand. As Tom previously mentioned, during the second quarter, we made the decision to discontinue the Rickland Orchards brand. The decision to discontinue the brand will allow our internal resources to better focus on the execution of our overall snack strategy and the execution of our strategy for…

Thank you, Mr. Cantwell. [Operator Instructions] And we'll take our first question from David Palmer with RBC Capital Markets.

Hi everyone. Kevin Lehman in for Dave Palmer this evening. Question for you with regard to top line. B&G's doing relatively well in your top-line performance, at least relative to some of your bigger food peers. Was wondering if you can help us interpret in general what's happening in the measured channel food environment. Volumes are largely down, seemingly getting worse this summer, despite food inflation. Can you just talk about what retailers and consumers are doing and why? Thank you.

Well, we're not seeing a real consumer change from what we've seen kind of in the last couple years. So we're not seeing anything different than we've seen. And for pretty much across the majority of our brands, the plus or minus is actually up for us in this quarter, except for those two brands I mentioned earlier. So we're not seeing that big change. You have a small change of a consumer on a regular basis, and it's still small, who find other alternative means to shop. And part of all of us need to be able to supply those consumers and how they do that, whether that's consumers buying off FreshDirect, Amazon, etcetera, or going to very specialty kind of grocery stores as opposed to the mainline stores. But for most of the products we sell, we see a very stabilized business here. And as we mentioned earlier, the two brands that struggled in the second quarter and also didn't do well in the first quarter, TrueNorth and New York Style, are very small brands in our portfolio. They are snack brands, were not permanent shelf placement in everywhere they sell. So it's a little bit more challenging. But we think we have some real opportunities even on those two brands. From the rest of our portfolio where our brands have regular shelf presence, we're feeling very good about the rest of our portfolio and what consumers are doing when it comes to our brands.

Thank you.

Next we'll hear from Andrew Lazar with Barclays

Good afternoon, everybody.

Good afternoon.

Just a couple things from me. I guess first off on Green Giant, I think you'd put out some sales guidance, I believe for the year of $510 million to $520 million. So I'm just trying to get a sense if that still generally holds based on what you saw in this quarter.

Well, we expect upside to that. So the $510 million to $520 million was really kind of the base business as-is without the innovation. So we will have upside to that starting really the end of August, beginning of September, really through the last four months of the year as we sell into the customers who have accepted.

Got it. And that was my next question. I wanted to make sure that the $510 million, $520 million was ex-innovation, and I realize that that comes on top of it.

Yes. And based on once we get into our third-quarter call and have a better feel of how things are working, and we expect really good things to be able to talk about, we can start giving better guidance as we look out in 2017 on where Green Giant sales can go for us.

Got it. And by the way, the EBITDA guidance, that similarly does not have sort of any innovation impact on Green Giant in it, is that correct?

That's correct, because part of that is there's a little bit of one-time cost when it comes to slotting and other things that offset some of the benefits. But you are correct in that. It's really our…

Got it.

Our base business without that incremental.

Great. As far as the innovation is concerned on Green Giant, given you've obviously shown it all to the trade and such, I guess are you able to talk -- I could have missed it. But are you able to talk more, I guess openly about, I guess more specifically what these products are? Because I haven't seen it yet or -- and I could have missed it, admittedly, but.

No. We're kind of holding back like we're launching the next special technology.

All right.

But we're going to formally do something here, most likely mid- to late August, with a formal launch, formal announcement. So we have not publicly announced it outside of just talking to the trade directly. So --

Got you.

Got a few more weeks to wait.

Got it. Stay tuned on that, okay. And then I've been consistently underestimating, I guess, the overall corporate sort of gross margin change on a year-over-year basis through the first two quarters. And a lot of that, obviously, has been Green Giant coming in a lot more profitably, as you've talked about. I guess, I know that that profit profile may change a bit once you start getting into the A&C spend, some of the trade spend on launching new products and stuff like that. But I guess is there a way to think about what a more sort of normalized go-forward gross margin percentage might look like for B&G overall at this stage?

Yes. I have that.

I think around 32%.

Even directionally would be helpful.

Yes. So it's certainly in excess -- we're looking at a gross margin of 32-plus percent.

Okay. Got it. That's helpful. Just two more quick ones. I guess, if I'm thinking about the B&G overall sales range that you've stuck with for the full year, I know sales came in a little bit lower this quarter than maybe I'd modeled, and you talked about the base business. If base business is flat in the back half, I guess Mama Mary's stops, I guess, contributing incrementally in the second half. So that implies, I guess, a more significant Green Giant acceleration to get to that overall sales range. Maybe not to the innovation sell-in or --

Yes.

Okay.

Yes. So you're right in how that looks. I mean, to be on the higher side of that sales guidance that is coming from Green Giant innovations.

Okay.

Because we're looking at a flat year-over-year in the last six months on the base.

Got it. Got it. And then last thing, and just to be quick, but I know you're much more in acquisition mode. That's kind of how you built the business overall. There are a couple things within, as an example, like the snack portfolio that haven't necessarily played out the way you would have wanted. And you learned a lot, obviously, from it, whether it's Rickland or TrueNorth and things like that. But I guess now that you've got this bigger frozen platform to work off of, I guess are there things that you look at in the portfolio from time to time that maybe you say might be better off in someone else's hands and it gives you the ability to focus your resources a little bit more in a more targeted way on the areas where you can, I guess do some bigger things on some of your what I'll call core platforms?

Sure. No, it's a very fair question and it's certainly something we look at internally here. The sell-off math, the pure math doesn't typically work for us based on where we trade to be able to do that, net of taxes. But it is something we're not actively considering today. But as we continue to get bigger, hopefully, through acquisitions, there are probably things that, kind of are legacy pieces of business, that fit less and less every day in our portfolio.

Right.

So when you kind of look at the key brands in our portfolio, most of them are actually doing very well and kind of the overall base is getting dragged down by some what I call kind of our lower-tier pieces of businesses that sometimes are more challenging than others just by the nature of what they are.

Right.

So it is something we think about and it's something we very much talk about at a Board level. Today we're not actively thinking about trying to sell anything. We're still an acquirer first. But as we keep growing, and hopefully we keep growing through these acquisitions in addition to growing what we own, it's something we will be looking at further.

Right. Thanks very much. And I'll see you in a couple weeks.

We'll now hear from Bryan Hunt with Wells Fargo.

Thank you. And good afternoon. Bob, I was wondering, since you're 90% of the way through your hiring, is this SG&A run rate, barring the normal seasonality, pretty much at a fair level to look at going forward?

Very close. Outside of the marketing spend. So the marketing spend on Green Giant in the first half of the year, for example, we spend a little over $8 million. The second half, we're going to spend a little over $25 million. So that's the only thing that kind of skews that a little bit. There's a little timing on some of those additions that came here in the second quarter, but it's not that meaningful. As long as you're just skewing the Green Giant marketing spend, yes, I'm very comfortable with kind of looking at the run rate in the second quarter and looking at what that looks like in the second half of the year.

Speaking of Green Giant, last year the harvest for a lot of the products you sell, whether it's peas or green beans, was quite favorable. It appears weather's quite favorable again this year. Can you kind of frame up what you're seeing from the farmers that you all contract with in terms of supplies for the year and the outside for maybe cost on vegetable side?

Well, what I can tell you as of what I know today, so when you kind of -- and you know it's different crops. So the pea crop in the US is done - good weather, good production, going to look and the cost level's going to look like in 2015. They're in the middle of the corn harvest as we speak. It's really been good weather conditions for that too. So hopefully nothing happens here in the next few weeks, because that's pretty much done in a couple of weeks. So I think unless all of a sudden there's major, major rains continuously, I think this is going to be a very good harvest year, because it's not a concern with drought for most of the crops. And certainly peas and corn are the biggest, and then it dwindles down. So cost should be relatively. I don't believe today we're thinking that the crop situation is better than 2015, but it's coming in like 2015. So cost will remain very stable here.

And then when I look at your four new platforms and 16 overall new products, are these products going to cause you all to maybe change your raw material sourcing in any major, major way that may present a new risk going forward?

No, just vegetables. Same vegetables, just different ways to serve up the vegetables, yes.

Well, that's good insight. Thank you. And then my last question is, and we've discussed this in the past, but just a refresher. When we think about the Company's appetite for acquisitions, you've always been fairly disciplined in terms of using equity as a mechanism to balance the capital structure. But if you were to make something sizeable, what's the willingness to take leverage to? What kind of target point? What's the peak point that you're willing to take leverage to get something done?

It always can change. We took, when we did Green Giant, we were, before the deal, we were around 4.5 times levered, 4.6. We took leverage up to 5.6, 5.7 on a deal the size of Green Giant. I don't think today we would look to go above that, and certainly not above six. And the preference and the longer term goal here is to stay below five and stay in the mid fours, if not below.

Very good. Best of luck on the next question.

Thank you.

We'll now hear from Karru Martinson with Jefferies.

Good afternoon. When you guys talk about taking reduction in base pricing, I mean, is that coming more from competitive pressures or is that coming from your customers? We're hearing a lot from grocers saying we're investing in price, we're going back to our suppliers, we're trying to be more competitive. Kind of what's driving the reduction in your base business pricing here?

Yes. So most of this is actually contractual. So our base business pricing was off $700,000 for the quarter. We have some very large customer relationships in maple syrup. The exchange rate in Canada -- so we have contractual relationships that it's just a contractual flow-through. With the exchange rate in Canada being better than last year, it drove our price down. So our costs are down and the net proceeds are the same at the bottom line. But we had to lower pricing to those customers. That's where the majority of that's coming from. And if for some reason the Canadian dollar would go up the other way, above where it's trading today, we would be able to generate incremental pricing. So most of that's contractual. We're not seeing that pushback on our brands that are being sold at retail. So we're not really seeing that pushback from retailers. I mean, retailers are always looking to make more money where they can, but not so much on reducing, pushing us to reduce price at all.

Okay. And historically you guys have always kind of looked for those tuck-in acquisitions, strong cash flow generators, and certainly not conservative on leverage. But Green Giant kind of took you a little bit out of your comfort zone, but has proven to be very successful. When you look at opportunities to continue to grow the business, is the mindset more of those tuck-in kind of orphan brands or to go towards the Green Giants where there's perhaps greater opportunity?

I think it's a combination. But when we looked at the Green Giant acquisition, we looked at that acquisition where we paid less than eight times EBITDA, and buying an asset. So we get the benefits for cash taxes relating to the asset purchase that it fit into the B&G model that kind of what we thought their EBITDA was, 60-ish percent of that EBITDA was going to turn into free cash flow. And then as a board, we would be sharing 50%, 60% of that free cash flow back to shareholders in the form of dividends. So it fit into our model. We did see, certainly more risk on a business that was somewhat mismanaged by the prior owner and was really shrinking fast. But we just saw a lot of opportunities on being able to fix that, and it's really come together and it's working. So when we look at acquisitions, we certainly want a brand, a retail-branded business that we believe in, but it has to be that cash flow model because that's the model that has worked for us and investors. And that EBITDA needs to turn into 50% to 60% free cash flow day one when we own it. And hopefully we can do the right things and grow the top line along the way, too. So the model drives the decision. Certainly the brand that we're buying drives the second part of the decision. But the cash metrics have to work, otherwise, we're not going to take a risk on that acquisition.

Thank you very much, guys. Appreciate it.

Farha Aslam with Stephens, Inc has our next question.

Hi. Good evening.

Hi.

Could you talk about the freezer case and where you're getting the incremental shelf space for your new products?

Fair question. So it's customer-specific and we don't always know the details. But average customer take on this is about 12 SKUs. Some have taken all 15. But all the big guys seem to be in this range of right around 12 SKUs. It's a little bit here and there. Again, because in freezer it's a little different because they want to make sure the block works, so the Green Giant block versus competitors work. So they'll squeeze on the outskirts of just not pure vegetables, too. So on a couple of accounts, some of our very slower moving items we gave up for these new items. But we do know they're going to be taking a little bit from everybody to get us in the case.

So is the vegetable kind of shelf space growing net, with you entering?

Well, we're hoping so. Over time, we'll see. It's not easy to grow because it's about the door space, and they don't really like to mix doors. So it's almost like if it moves, it's got to move like another whole door. So it's kind of that door is pretty much all vegetables and not something else on the door, too. So it's customer by customer. We think we're creating some things that, hopefully, longer term, can move the space that's allocated to vegetables, too. And there's certainly little, around this country, you have little players who show up in smaller ways. They certainly get squeezed in things like this. And our main competitors are also coming to the party with new items, too. So that's part of what all these stores have to figure out. It's not like we're the only people innovating in the category.

And so is private label and smaller players losing space to the two larger players? Is that how you'd characterize the category is developing?

I don't know that yet, as this is getting play. So I don't know that today. Certainly I don't believe that private label commodity products would lose its space. Basically bags of peas and corn and broccoli, I don't expect. And it truly is chain by chain on how they figure out how to do that. Certainly some chains have more ability and more space than others, just by the nature and size of their stores. But we don't know that yet. So part of this is we are not typically what you would call the category captains who reorganize the shelf space when these chains accept a new item. So I don't have enough detail. So we'll know that as these items get placed and see what's actually happened in the individual customers.

That's helpful. And my last question is, this space that you're going into in the frozen space tends to be sort of a mini-reset. The more major reset tends to happen kind of in that February timeframe.

Yes.

Are you anticipating incremental shelf space? How do you think this Green Giant brand develops over time?

Well, we want more incremental shelf space. And we're also going to be launching new innovation here in 2017, that's different than even what we're talking about today. So that's certainly the goal, to make sure we have our fair share of the shelf, and also hopefully have more innovation than our competitors. But we have very strong competitors in this category. We've done a tremendous job in this category. We want to get our fair share and grow our business.

That's helpful. Thank you very much.

Next we'll hear from Eric Gottlieb with D.A. Davidson.

Yes, hi. I just want to talk a little bit about the new products some more, as much as we can. Are they aimed towards a certain sector of the consumer? Children's? Moms? Anything like that?

I think we're going to kind of pass on that, because we really want to do a very formal announcement of this here, because we think it's a real big deal, in mid- to late August. We actually haven't picked the official date yet.

Okay. That kind of ties into my next question, which would be, is the advertising or the marketing tied into a certain event? In August, I'm thinking Olympics, back-to-school. Or it's just going to be some…

I can tell you we're not doing the Olympics. I can tell you that. But, yes, we are kind of turning up the advertising slowly in August, larger in September, and then a bigger push once -- because at the end of the day, as this rolls out into the customers that's taking, we want to make sure it's in the freezer sets, it's on shelf, before we really turn up the advertiser, because we don't want a consumer to see an advertisement the third week of September, and then they go to a store and they can't find it. So the majority of the spend will happen October, November, December. But we are turning it on here a little bit here in mid- to late August, and then more in September, with the big push in the fourth quarter.

Okay. And given how innovative these are planning on being, do you own the technology or patent on the technology?

Well, there are formulas, yes.

Okay. But I was trying to get to what kind of product we're at. And then I know we said we're going to unleash the Green Giant advertising, the actual Green Giant later in the year. Is this in tandem or we're going to do that beforehand?

We're going to do a little bit of that beforehand. So there'll be a little bit of that, and then the fourth quarter will be a little bit more of the push toward the products as opposed to just the Giant.

Okay. And now moving to another area. This quarter you benefited from lower-than-anticipated trade expense. How much of that is going to carry over?

It's not going to continue. So part of the mix of the Green Giant business has been more beneficial to us than we understood when we first bought the business. So we bought a business initially that we thought on the base that we bought, we could hold to a level of $550 million in sales. Now, the business shrunk further than that. And that's why we've said that the base business, without the innovation, is somewhere between $510 million and $520 million. What we gave up, and not willingly all the time, sometimes it was just business that was being lost by the former owner, was lower margin product. A lot more of the commodity stuff, what they call the majors in these categories. It's kind of bags of peas, bags of corn. Very high trade spend, little to no gross profit margin. It gives you face presence on shelf. It gives you a bigger block. You need to sell it because consumers buy that too, in addition to all the intriguing new stuff. And that's where we kind of lost from that $550 million to the $510 million. So part of this is it's not a pullback on trade spending on the products we're selling today. It's more of a mix-down to where we're taking out, it's not because we wanted to, per se, it's kind of just what we lost in this transition, much higher trade spending businesses that on a percentage of gross sales could be 40%, 50% of the gross sales number, and really just low profits, which is helping our just pure EBITDA margin too. Now, we do want that business back. So it's important to -- and we're pushing to get that business back, in addition to just the innovation.

Okay. One last question, then I'll pass it on. You had said that for 2017, you're expecting a growth trajectory from your base business. Given the trends that we saw this quarter, is there any particular business that you expect to rebound?

Well, we're going to see it as we head through this year. Our biggest base brand that's just relatively flat year to date is Ortega, just because of the rollover timing from a recall. We expect a strong second half of the year and we expect that to continue through 2017, for example. And when we talk about growth trajectory on the base in total, we're really talking about a business model, that 1.5%, 2% growth. We're not talking about a business that's going to move the needle 3% to 5% in total.

Got it. Thank you very much.

Our next question comes from Eric Larson with Buckingham Research Group.

Yeah, good afternoon, everybody. A lot of my questions have been answered and will have some follow ups. But you alluded to this I think in your formal comments. But you said that the Mexican peso, given the strength of the US dollar, is translating to some better gross margin. And so as you kind of now look at your two international businesses, Canada and Mexico, given the size of that Green Giant plant in Mexico, would the peso be a more important currency for you now than Canada? How should we view your currency mix kind of going forward with Green Giant?

Yes. I would say that the peso, at this point in time, is clearly the more, I guess important to us, just given the size of that plant in Mexico and the amount of cost flowing through there. We're more sensitive to the movement in the peso. Obviously, it's gone the right way for us in 2016. So we are hyper-focused on making sure that we watch where that's going, that we are putting in the right programs to make sure that we sort of lock in currency at the right time to protect ourselves as we close out 2016, and we start to enter 2017 planning in the next month or so. So definitely Mexico is really the clear sort of, I guess risk item, that we focus on more so than Canada. Canada, too, of course, is a factor, and we're very conscious of that and we watch it very closely as well. But in terms of the actual swings and the volatility, that's where I spend a lot of my time, just making sure that I focus on the peso. And this year, we've been very lucky in terms of where it's gone. But we're also trying to make sure that with where it is today, that we're starting to lock in that benefit sooner rather than later.

Okay. No, that makes sense. And I think you kind of alluded to this. Maybe you said it. But you will try to fully hedge those raw materials on an annual basis coming out of Mexico?

Yes. we'll look at that volume in the planning phase as we're going through it, like I said, now and the next couple months or so, and we will lock in the majority of it, I mean, 80% or so, for sure, and leaving some room for us to kind of wiggle. But we will try to lock in that 80% in the coming months.

Okay. Great. Thank you.

Kenneth Zaslow with BMO Capital Markets has our next question.

It's [Vishal] on for Ken. So you beat on EBITDA for the quarter by over $10 million compared to consensus. And I think you're raising the guidance for the year by less than that. Can you talk about why that's not flowing through in full? You may have talked about it already, but just to kind of rehash. Thanks.

Okay. As we looked at that, we're taking a little bit of that money off the table and using it against a couple of our key brands and certainly Green Giant, too. So we're seeing that as an opportunity to help drive Green Giant even further here over the next six months. Anything else?

No, that's it. Thanks.

Next we'll hear from Jon Andersen with William Blair.

Hey good afternoon Bob and Tom.

Good afternoon.

Couple housekeeping questions. SG&A came down about $5 million sequentially from the first quarter. And I'm just wondering, I think you mentioned that you've actually increased hiring during that time frame to support Green Giant. Can you talk about just that dynamic, whether it would have been such a significant sequential reduction? And then I'll have a follow-up.

That one I think Tom will get back to you on. This quarter is a much more -- it's a better reflection, as long as you just take into account the marketing spend that will come in the second half of the year on Green Giant of kind of a true look at where our SG&A will roll out. But we can certainly talk later about what that big change was from the first quarter to the second quarter. I just don't have that handy.

Okay. Fair enough. And just for clarification purposes. So I think, Bob, you said that the Company spent about $8 million in marketing against Green Giant in the first half of the year and plans to spend 20…

Around $35 million, yes.

$35 million in aggregate for the year?

Total, yes. Yes, right around $35 million. $33 million to $35 million, yes.

Okay, perfect. And any thoughts on a cadence for Q3 and Q4 on that incremental $25 million?

Right. So we would look at Q3 being about $5 million to $6 million. Probably closer to $5 million, but it could go, depending on just the spend pattern, it could be upwards of $6 million, the rest coming in the fourth quarter.

Okay. Perfect. And the last one from me is just thoughts on like with the frozen platform now and that business obviously performing from a profitability perspective at a very high level for you, as you look forward, I mean, can you talk at all about your M&A priorities? Is it purely opportunistic? Are you interested in enhancing the frozen platform? Are there assets out there that you're considering right now?

I think the answer to that is we're certainly always -- we're ready organizationally and balance sheet-wise, to look at things. We're a branded retail buyer. The cash flow model has to work. So and it has to be brands that we'd want to own. And that could come from frozen. That could come from dry. That can come from snacks. Or it can come from another platform altogether. So I think the most important answer there is, the organization is ready and our balance sheet's ready. When something comes along that works for us, we'd be ready to buy it.

Excellent. Thanks a lot.

That will conclude the question-and-answer session. I'll turn the conference over to Mr. Cantwell for any additional or closing comments.

Thank you, everyone. I look forward to updating you on the progress of Green Giant innovation rollout during our third-quarter conference call. And again, thank you for your interest and your support in B&G, and have a good evening. Thank you.

That does conclude today's conference call. Thank you for your participation. You may now disconnect.