Good day, and welcome to the B&G Foods Third Quarter 2017 Earnings 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 ir.bgfoods.com. Before the company begins its formal remarks, I need to remind everyone that part of the discussion in today's call includes forward-looking statements. These statements are not guarantees of future performance, and therefore, undue reliance should not be placed on them. We refer 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. Bruce Wacha, the company's Executive Vice President of Corporate Strategy and Business Development, will start the call by discussing the company's financial results for the quarter. After that, Bob Cantwell, the company's Chief Executive Officer, will discuss various factors that affected the company's results, selected business highlights, and his thoughts concerning the remainder of 2017 and beyond. After the prepared remarks, Bob, Bruce and Amy Chiovari, the company's Interim Chief Financial Officer, will be available to answer your questions. I will now hand the call over to Bruce. Bruce C. Wacha - B&G Foods, Inc.: Thank you, operator. Good afternoon, everyone. Thank you for joining us today and Happy Halloween. It…

Thank you. At this time, we'll go to Rob Moscow with Credit Suisse. Please go ahead. Robert Moskow - Credit Suisse Securities (USA) LLC: Hi, and thank you for the question. Obviously, the sales here are better than what I had feared and that's great news. I did have some concerns about cost and revenue into 2018, and maybe first of all, did I hear you say that you thought the base business would grow in 2018? That's the first question. And then secondarily, logistics cost, we've heard about contracts going up 5%, maybe even 10%. Can you give us any visibility for your business in 2018 and is it something that you can manage through? Thanks. Robert C. Cantwell - B&G Foods, Inc.: So we certainly think, well, two things. Yes, answer, our base business' expectation for 2018, and we'll give a more formal guidance with our year-end call, but we expect it to grow overall, which includes Green Giant. So Green Giant is part of that base business. And, yes, just like everybody else, logistics costs are real and going up, and that 5% to 10% number is kind of what we're hearing, I mean, a little bit of what we're seeing. We can manage that. That's a number, kind of worst case for us, give or take would be $5 million. We just have to manage through that. Sometimes it's actually good when the whole industry is moving up, including key customers who also truck their products around from their distribution centers and everybody kind of experiences that, and hopefully, you can ultimately pass price and/or save money elsewhere. Robert Moskow - Credit Suisse Securities (USA) LLC: Okay. I mean, I was getting to a higher number than $5 million. Is that because maybe I've overestimated logistics…

At this time, we'll move now to Farha Aslam with Stephens, Inc.

Hi. Good morning. Robert C. Cantwell - B&G Foods, Inc.: Hi. Good afternoon. Bruce C. Wacha - B&G Foods, Inc.: Hi.

Or actually afternoon, it's been a long day. Green Giant, are you reaffirming that the brand should have sales of about $520 million to $530 million? And any color in terms of more detail on what level of growth we should expect for next year? Robert C. Cantwell - B&G Foods, Inc.: Well, we're going to hold off on that. Growth is going to be very strong next year, but we'll give a little bit more guidance here when we do our year-end call. But, yes, we're very comfortable in that range on Green Giant, $520 million to $530 million for this year.

That's helpful. And then on Pirate's Booty and Ortega, could you just give us some color on the sustainability of Pirate's Booty into the fourth quarter and possibly into next year? And also some color on exactly how weak Ortega was in your outlook for the brand? Robert C. Cantwell - B&G Foods, Inc.: So, on Ortega, it was short a little over $1 million for the quarter, pretty much flat for the year. So, the brand is rock solid. We certainly have strong competition with our friends at Old El Paso among others, but we have our fair share of that category and are actually doing well, and it's a good category to be in. Pirate's just has lots of upside. We talked about at the end of the second quarter the one issue we had which was really promotional timing where the key customers are flipped into the third quarter, but in addition to that, we also knew we had additional distribution on Pirate's that was in place and some other programs with other customers, so we knew Pirate's was going to be really strong in the third quarter. We don't expect a 21% growth in the fourth quarter, but we expect Pirate's to continue to grow in the fourth quarter also year-over-year. If we can do 20%, that's great. But it won't be at that level, because we don't have that one-time promotional flip, and we expect Pirate's to continue to grow. It's a key brand in our portfolio. It's a brand that resonates with consumers, especially consumers with young kids. It's a very meaningful brand in our portfolio that we see some real upside to.

Final question. In terms of general pricing, your ability to get pricing in this current environment and any pressure you're seeing? Robert C. Cantwell - B&G Foods, Inc.: Well, like Bruce mentioned in his part, we had negative pricing in the quarter of about $2.9 million. I would expect to see a $2 million to $3 million negative price hit in the fourth quarter also. Yes, certainly there is some pressure on pricing in certain categories. So, you know, we have lots of brands and lots of categories. Some of the commodity-driven categories, certainly our canned items are in Green Giant, our canned Joan of Arc beans, et cetera, we're getting pushed on pricing there. We expect that to continue. But there's a general belief here. When you talk about just general cost increase, such as the whole, you know, the distribution cost increase that lots of companies are talking about now and experiencing, even though that we don't think it's a big hit to us, we think those are the kind of price increases that we should be able to pass on if needed, if we can't save elsewhere and we can't cut costs in different ways. But, if it's a major commodity mover, but we don't have any commodities we know of that are moving in a large negative fashion for us. I believe we can pass prices on those too. But certainly more commodity-driven products with a lot of low-price competition, such as canned vegetables and canned beans, taco shells on Ortega, a little tougher to move pricing, because the competition is out selling cheap. But for most of our brands, we don't have that low-price competition and we think that, if needed, we can move pricing. We don't see a major need on any major pieces of our business and concerns on cost in a big way as we go into 2018, that we have to be aggressive taking prices on.

Great. That's helpful. Thank you.

We'll now move to David Palmer with RBC Capital Markets.

Thanks. Good afternoon. This quarter, your organic chips sales, they were up 3% versus about a 2% growth in the scanner data, and given all the potential areas of non-measured channel noise including what you're doing with spices, with Sam's, and then you mentioned the dollar store canned veggie declines last quarter, I can only imagine that those two matching is maybe a coincidence, or at least things going up and down away from what we see in the measured channel data. So, looking ahead to fourth quarter, if we're looking at – and I think we're looking at measured channel data that's up some small amount, I'm just trying to get a sense of what we should be thinking about beyond that measured channel data that will give us a sense of what your organic sales growth would be in that fourth quarter. And I have a follow-up. Bruce C. Wacha - B&G Foods, Inc.: Sure. I mean, we obviously are targeting fourth quarter sales to be up. The one thing to make sure you're correcting for when you're looking at the scanned data is the Tone brand within that spices and seasoning where we did have a customer that switched to private label, and so that it is one area in the scanned data where it will show negative, if you're not thinking through and giving us some incremental benefit.

So you're... Bruce C. Wacha - B&G Foods, Inc.: That's fine, but you'll still see that in the fourth quarter.

So you're thinking organic sales will be up in the fourth quarter, just to be clear? Robert C. Cantwell - B&G Foods, Inc.: Absolutely. And what I said in kind of my comments, with a very strong third quarter here, we're now year-to-date only down on our, what we call our base business 1.4%. We expect to take that 1.4% into a positive number by the end of the year, full year. So, we're going to be up very nicely in the fourth quarter.

The guidance, I mean, I guess, at least as we're implying, as we're inferring from this, implying for the fourth quarter, it kind of feels like people's estimates previous to this sort of are towards the high-end of that and the range is, as you left it is still fairly wide. Is there something that we should know about variability that you left it at that wide of a range going into the fourth quarter that we should be thinking about? Robert C. Cantwell - B&G Foods, Inc.: Not from a variability; I mean, we certainly moved the bottom of the range $20 million up to be more realistic, and when you kind of put numbers on paper, hopefully we're on the high-side of that range, but the very, I mean this – and we already are through October. We know what those results are. We've only got basically nine week left to the year. We're not seeing anything that's going to blow up. Everything seems to be turning the way we expected. So, it's not a lot of variability as you know from our business plus or minus that could change that dramatically in a quarter anyway. So, Green Giant is going to continue to grow and we expect a number of the other base businesses to have a pretty strong fourth quarter also. Net-net, we're going to be up very nicely in our base business and seasonings is going to turn along like it's been turning along all year. So from a sales perspective, we're looking at a pretty rock solid finish to 2017.

One quick one on gross margin, you've had obviously a very unusual last 12 months where the onboarding and the supply chain create a lot of noise and now you're lapping that. But if you're going to get into a normal seasonal rhythm of your business, would the gross margins be below average or above average? Right now, you're saying slightly below the year-to-date run rate for the fourth quarter. And I'm wondering if there's an insight there about maybe selling more of the basic veggies during the holidays and that offsetting some of the scale of it being a high sales quarter. How does that kind of work going forward (34:03)? Robert C. Cantwell - B&G Foods, Inc.: So basic – we're at kind of this 30.2% gross margin kind of year-to-date. That's kind of pretty much been what we've been tracking every quarter. So it's been fully consistent. But if you look at kind of our gross margin in the fourth quarter of 2016, it was a little over 26%. So it does drop from the 30% range to in that 26% range in the fourth quarter, all driven because of Green Giant promotional activity for Thanksgiving, particularly, but then through Christmas, which will net our gross margin down to kind of in that 29% to 30% that Bruce had talked about. But we'll look at very consistent gross margins with last year, and last year we were at 26.4%, so it should be very similar in the fourth quarter of this year. And it's the Green Giant effect on our business in the fourth quarter. Bruce C. Wacha - B&G Foods, Inc.: But certainly if you look back historically, you'd see 2014, 2015 gross margin is the same levels on an annual basis.

Thank you.

We will now move to Andrew Lazar with Barclays.

Good afternoon, everybody. Robert C. Cantwell - B&G Foods, Inc.: Good afternoon. Bruce C. Wacha - B&G Foods, Inc.: Hi.

I guess one key question from me is, you raised obviously the sales guidance for the year in part due to the addition of Back to Nature. You didn't change the EBITDA guidance at all for the full year, albeit I know it's a somewhat wide range. So I'm just trying to get a sense of does Back to Nature, is it expected to contribute much in the way of EBITDA in the fourth quarter? Because if it is, then perhaps that means the underlying base business EBITDA is a little bit less robust. If it doesn't, then that's not so much of an issue. Do you see what I'm trying to get at? Bruce C. Wacha - B&G Foods, Inc.: Not a lot of impact in the fourth quarter. Keep in mind that we just took the business on. We'll have it from one quarter, but there's something that we're doing from a cost savings standpoint bringing that business on, including the office down in Florida. So, really you see the impact in 2018 where we talk to $17 million of run rate EBITDA.

That's helpful. Robert C. Cantwell - B&G Foods, Inc.: And we had also – so we did the acquisition, it would take about six months to have that run rate EBITDA. We're very comfortable now. It's really three months from now, so the beginning of January, because we're basically eliminating their G&A effective the second week of January, which is why we're not going to show much EBITDA on Back to Nature all in the fourth quarter.

Yeah. Got it. That's helpful. And then obviously as you said, you're not going to really give guidance on 2018, of course, till the fourth quarter call. But are there a couple of things that maybe you can clarify that we do know now that are sort of discrete contributors, if you will? In other words, I guess, how much left, we know what Back to Nature is expected to contribute incrementally on EBITDA. With respect to ACH and Victoria, trying to remember how much we think those contribute incrementally in 2018. And then beyond that, it would just be obviously whatever happens with the base business. Is that right? Robert C. Cantwell - B&G Foods, Inc.: Right. Well, Victoria and seasonings, we have for the full year of 2017. So it's really just whatever we grow them is incremental. There's no – so, we've had them for the full 12 months in 2017. We bought them in end of 2016. So there's no just pure acquisition and incremental growth from them.

So it's really just base business EBITDA growth and then whatever obviously comes from Back to Nature? Bruce C. Wacha - B&G Foods, Inc.: Exactly. Robert C. Cantwell - B&G Foods, Inc.: Correct. Yes.

Okay. Bruce C. Wacha - B&G Foods, Inc.: What we do have for both of those acquisitions from last year is the incremental pick-up in the fourth quarter, that brings us to our guidance.

Right. Yeah. Got it. Perfect. Thank you very much. Robert C. Cantwell - B&G Foods, Inc.: Okay.

At this time, we'll move to Eric Larson with Buckingham Research Group.

Yeah. Thank you. Nice quarter, everyone. Robert C. Cantwell - B&G Foods, Inc.: Thank you. Bruce C. Wacha - B&G Foods, Inc.: Thank you.

A couple of questions and it relates kind of to the roll-out of your Spirals product, Bob, and I think last year in the fourth quarter when you introduced your rice veggies, you sort of underestimated demand. You didn't have, I don't think the capacity or the inventory to meet the retailer's demand. And then, again, that led to I think a purposeful increase in your inventories for Green Giant in the first half of this year. You wouldn't anticipate the same type of inventory build for Spirals or anything such as that? And maybe that's a good thing, but could you give us a little bit of thought on how the Spirals rollout might take place in the first quarter? Robert C. Cantwell - B&G Foods, Inc.: Well, certainly, we are building Spirals inventory now. We started building it towards the end of August. So we're fully ready and have capacity to support a very large launch and a very large, hopefully, brand addition. So that's not an issue. A lot of the inventory issue was some of the innovation last year, but it was more of us needing to build inventory because we didn't just have enough of the basics, but also build inventory in connection with closing down the former General Mills' plant then being added there at the end of September which we're now out of, so. We'll actually see a benefit on inventory reduction as we certainly go through the rest of this year and through the first half of next year versus what we saw this year. We'll actually be taking cash out of inventory as opposed to building inventory over the next nine months here.

Okay. Good. Thank you for the clarification on that, because I was going to ask the cash impact of that. Then just another follow-up on that, your slotting allowances, I believe, took about a 100 basis points out of your third quarter gross profit margin. Well, obviously that – well, I shouldn't say obviously, but you'll have the roll-out of Spirals, will you have more slotting allowances impacting your fourth quarter and maybe into your 2018 gross profit margin as well? Robert C. Cantwell - B&G Foods, Inc.: So we'll certainly have, not in 2017 here, so not in the fourth quarter, but we'll certainly have slotting payments to be made on Spirals in the first half of next year. But in the first half of 2017, we spent a lot of slotting money also that where – we front-loaded slotting last year as we filled out distribution for all the rice veggies and veggie tots, et cetera, so. That will look almost identical. So once – we've now gone through and we'll have some benefits on marketing and slotting in the fourth quarter here than this quarter that helps us versus last year. But once we get through this year-end, the cadence of our spending from marketing to slotting and everything else will look very similar on a quarter-to-quarter basis in 2018 versus 2017.

Okay. And then just one final question, Bob, I think the fourth quarter last year, I believe the fourth quarter captured the vast majority of that increased spend that you had for Green Giant. I don't know if you started that in the third quarter of last year. Did the third quarter this year include some marketing spend from Green Giant, trying to get to an even cadence across the quarters? Did the third quarter include spend this year that you didn't have last year in Q3? Robert C. Cantwell - B&G Foods, Inc.: No. It's actually very consistent. And actually this quarter was a little less than $1 million spend less than last year.

Okay. Robert C. Cantwell - B&G Foods, Inc.: As we roll into the fourth quarter, as Bruce mentioned, that's where you see the big spending reductions versus 2016.

Okay. Thank you, everyone.

At this time, we'll hear from Jon Andersen with William Blair. Jon R. Andersen - William Blair & Co. LLC: Hey. Good afternoon, everybody. Thanks for the question. Robert C. Cantwell - B&G Foods, Inc.: Hi. Bruce C. Wacha - B&G Foods, Inc.: Hey, Jon. Jon R. Andersen - William Blair & Co. LLC: Just sticking with marketing for a minute, I'm wondering if you can talk a little bit about your full-year marketing spending plans. Are you still looking at about $90 million in total? I think $20 million ends up kind of deduction from gross to net and about $70 million are below the line. But just wondering if that full-year cadence, that full-year level is kind of similar to what you previously thought. Robert C. Cantwell - B&G Foods, Inc.: That's correct. Jon R. Andersen - William Blair & Co. LLC: Okay. And then the cadence of that, because the cadence has been different in 2017 than the cadence in 2016, as we look to 2018 and look to modeling the quarters in 2018, are you expecting 2018 to look a lot more like 2017? Or is there some timing that you can talk to, to help us kind of think through the progression? Robert C. Cantwell - B&G Foods, Inc.: It'll look more like 2017. Jon R. Andersen - William Blair & Co. LLC: Okay. One bigger picture question; the overall sales run-rate for the company is – you've doubled the size of the company since 2014 with Green Giant and the other acquisitions. And I guess I'm just trying to get a sense maybe, Bob, how you feel overall today about kind of the capacity of the organization, the execution capabilities of the organization? Obviously, this is a very strong quarter. Where are you in…

We'll now move to Cornell Burnette with Citigroup.

Thanks a lot and congratulations on the quarter. Bruce C. Wacha - B&G Foods, Inc.: Thank you. Robert C. Cantwell - B&G Foods, Inc.: Thank you.

I just wanted to know, obviously, over the past couple of years, there's been some steady losses in distribution at the Green Giant brand as it struggled, but just is wondering over the past couple of quarters as to sales, they've really begun to tick-up and turn the corner, if you can kind of dimensionlize, a, are you starting to see some of that loss distribution come back into play? And then over the longer term, perhaps what's the size of the opportunity in kind of reclaiming some of this lost share that you've had in the past? Robert C. Cantwell - B&G Foods, Inc.: Well, I think from the frozen side of Green Giant, the answer is yes. I mean, certainly all the innovation customers wanted and we're getting some of the core, and really have stabilized what we call the rest of the core and we see some really kind of even consumer takeaway growth where that is stabilized. When we bought Green Giant, what we saw was the opportunity in frozen. We knew it was going to be a tough year to two to kind of to get a pretty badly declining brand from flat to up, and today we're sitting here going – we feel really good about where it is and where it's going. And the real good news is, our competitors are growing too, which is actually good for the category. The whole category is growing. So with us and our lead competitor here, we're moving the whole category. So Green Giant only has ups on frozen. We have some difficulties on shelf-stable and challenges just because of the low-price environment that shelf stable competes in. That's just a challenge. But the future of Green Giant is, this is a business that was, in total, kind of a $700 million business. It's going to take time, but we see some big growth here over the next few years if not longer and really moving. Our first step is to get it over $600 million again. It's going to take a few years. Next step we'll try and get it closer to $700 million. But there's just tremendous opportunity. It's the right category to be in with today's consumer. It's vegetables. We're selling vegetables, which is better for you. It's certainly a category we're excited about being in. And it's certainly a category that we have a lot more innovation coming. And there'll be a lot more innovation in the pipeline over the next few years, including more innovation that we'll launch here in 2018. So, hopefully it's all up and it's all up for us and the whole category.

All right. And then in terms of maybe some of the spending behind the brand, I think in the previous question you had answered that in the third quarter that you spent about $1 million on the brand less than you did a year ago. What's the expectation for the fourth quarter in terms of the year-over-year delta and spending behind Green Giant? Bruce C. Wacha - B&G Foods, Inc.: Yeah. It should be about $15 million to our benefit. But, again, year-over-year for the full year, it'd be a similar number.

Okay. It's very good. Thanks a lot.

And at this time, we'll move to Rob Moskow with Credit Suisse. Robert Moskow - Credit Suisse Securities (USA) LLC: Hi. I think my question was actually answered. But I've got one more question. Your sales growth this quarter 28%; 25% from acquisitions. Operating profit growth is only up 8%. And I just want to make sure, I know fourth quarter, it's all going to come back. But if I had to isolate this quarter, why would that relationship between the sales and the operating income growth be so different? Is it because of higher spending this quarter on anything? Robert C. Cantwell - B&G Foods, Inc.: Well, it's consistently the same higher spending that we've experienced all year long, which is kind of why our gross margin has been right around 32% for the whole year and EBITDA margin right around 22%. As we took over this business in the fourth quarter of last year, we knew we were going to be being by our own in the frozen world, we knew our distribution and warehousing costs were going to go up pretty dramatically. And it is something we modeled in when we bought the business and we've seen that substantial increase. And, that's a number that kind of year-over-year has hit our P&L for about $18 million. All been modeled in and it's kind of been part of what we've had to explain through these first three quarters. Fourth quarter, you don't have that negative comparison because we were on our own in the fourth quarter. We took over transition of this business effective October 1 last year. So, fourth quarter has that level of spending. That's why EBITDA margins were much lower in the fourth quarter, et cetera. So the comparison is very different. So, nothing new…

We're going to hear again from Eric Larson with Buckingham Research Group.

Yeah, just a quick follow-up question for Bob and Bruce. If I take the mid-part of your EBITDA guidance for the year, just take the mid-part, maybe you got to move a little bit to the higher part. Take out your cash interest expense, maybe some cash taxes, your CapEx and dividends, it seems like – and given your ratio that you like to pay out, forecast dividends to shareholders, it looks like, Bob, maybe you could go to the board at the end of they year and maybe recommend that you have a small raise in your cash dividends. Is that – are my calculations wrong or how would you respond to that? Robert C. Cantwell - B&G Foods, Inc.: Well, no. Your calculation is – our cash generation after kind of our current dividend, give or take $124 million, is about $75 million after that. Yes, so there is plenty of money to support our current dividend. At every board meeting, we talk about what we should do with the dividend. The board is committed to sharing cash with investors, but it's a board conversation. I think the most important part of your point is, there's plenty of cash flow here to support our current dividend and any future raises we might want to do.

Thank you very much.

That will conclude the question-and-answer session. I'll turn it back over to Bob Cantwell for any additional or closing remarks. Robert C. Cantwell - B&G Foods, Inc.: Okay. Again, thank you for joining the call today and thank you for all your support over the years. We certainly look to have a very strong finish to 2017 and a great start and a great year in 2018. Thank you very much.

And again, this does conclude today's call. Thank you all for your participation.