Good day, and thank you for standing by. Welcome to the John B. Sanfilippo & Son, Inc. First Quarter Fiscal 2026 Operating Results Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to turn the conference over to your speaker for today, Jeffrey Sanfilippo, Chief Executive Officer. Please go ahead.

Good morning, everyone, and welcome to our 2026 first quarter earnings conference call. Thank you for joining us. On the call with me today is Frank Pellegrino, our CFO; and Jasper Sanfilippo, our COO. We may make some forward-looking statements today. These statements are based on our current expectations and may involve certain risks and uncertainties. The factors that could negatively impact results are explained in the various SEC filings that we have made, including Forms 10-K and 10-Q. We encourage you to refer to the filings to learn more about these risks and uncertainties that are inherent in our business. We began the fiscal year with strong momentum, continuing to execute our Long-Range Plan with discipline and focus. In this quarter, we delivered a 59% improvement in diluted earnings per share, underscoring the strength of our strategy, improvements in our commercial ingredients and contract manufacturing businesses and our relentless focus on generating operational efficiencies throughout our organization. We have seen directional improvements in sales volume over the past 3 quarters, signaling progress in stabilizing our overall demand. These results were achieved in a challenging snack food environment as consumer behavior continues to evolve in response to broader macroeconomic shifts. Our achievements reflect the hard work and commitment of our employees whose contributions remain vital to our continued success. Yesterday, the company's Board of Directors approved a special cash dividend of $1 per share on all issued and outstanding shares of common stock of the company and $1 per share on all issued and outstanding shares of Class A common stock. The special dividend will return approximately $11.7 million to company stockholders and will be paid on December 30, 2025, to stockholders of record as of the close of business on December 1, 2025. Our financial performance over the last…

Thank you, Jeffrey. Starting with the income statement. Net sales for the first quarter of fiscal 2026 increased by 8.1% to $298.7 million compared to net sales of $276.2 million for the first quarter of fiscal 2025. The increase in net sales was due to an 8.9% increase in weighted average sales price per pound which was partially offset by a 0.7% decline in sales volume, which is defined as pounds sold to customers. The increase in the weighted average sales price primarily resulted from significantly higher commodity acquisition costs across all major tree nuts. Sales volume declined across all major product types, except for peanuts, walnuts and pecans, all of which experienced volume growth in the quarter. Sales volume decreased 5.1% in the consumer distribution channel, primarily due to a 3.2% decrease in private brand sales volume. Approximately half of the decrease was due to the discontinuation of peanut butter at a mass merchandiser. The remaining private brand sales volume decrease was nearly evenly split between nut and trail mix and bars. Nut and trail mix sales volume was negatively impacted by higher retail prices and reduced promotional activity, which was partially offset by new business and expanded distribution with 3 existing customers. Bar sales volume declined due to our strategic decision to reduce sales to one grocery retailer and lost distribution to another, which was partially offset by growth at a mass merchandiser and a current customer. Lost distribution of Orchard Valley Harvest at a major customer in the nonfood sector also contributed to the overall decline in the consumer distribution channel. Sales volume increased 12.8% in the commercial ingredients distribution channel, mainly driven by new business with 2 customers, increased peanut bar volume at existing foodservice customers and increased sales of peanut crushing stock to peanut oil…

Thanks, Frank, for the financial updates. Success requires smart strategies and the right business model for sustainable growth. It also requires a talented and committed group of leaders across the organization. We have all those elements of success here at JBSS. I'll now share some category and brand results with you for the quarter. All the market information I'll be referring to is Circana panel data and for today, it is for the period ending September 28, 2025. When I refer to Q1, I'm referring to 13 weeks of the quarter ending September 28, 2025. References to changes in volume are versus the corresponding period 1 year ago. For pricing commentary, we are using Circana MULO+ scan data, and we're referring to average price per pound. We are using the nut trail mix and bar syndicated views of the category as defined by Circana. In the first quarter, we continued to see modest growth in the broader snack aisle as defined by Circana. Volume and dollars were up 2% and 5%, respectively. This is consistent with the performance we saw last quarter. In Q1, the snack nut and trail mix category was down 3% in pounds, which is a decline from last quarter. Dollars in Q1 were up 5%, which is consistent with Q4 performance. Price increases drove the dollar growth. Snack nut prices rose 8% with increases across all nut types. The prices for trail mixes rose 6%. Fisher snack nut and trail mix performed worse than the category with pound shipments down 6%. This was due primarily to some lost distribution and less promotional activity. Our Southern Style Nuts brand pound shipments decreased by 7%, driven by some reduction in distribution at a national club retailer. Orchard Valley Harvest brand, which primarily plays in trail mix was down…

[Operator Instructions] And our first question will be coming from the line of Hamed Khorsand of BWS Financial.

So talking about the snack bar business, the decline you saw, is that because of consumer behavior or because of the customer, the mass merchants and retailers and so forth?

So, thanks for the question. So it really was driven by consumer behavior. So we had a great overall strong back-to-school volume, but we did see some declines in one of the key bar segments, which was fruit and grain that we didn't anticipate. But overall, consumption for the bar category was strong. We had General Mills who came back online with their Quaker Chewy Granola Bars, which did not -- were not in the market last year or in smaller portions of the market due to their previous recall. So they were back in full force this period -- this year. But in addition to that, we did see strong growth with our private brand bar category.

Okay. And as far as the dividend is concerned, are you expected to just pay that out of cash flow? Or so this coming quarter is going to be high in cash flow? Or are you going to be going into debt for it?

It will be mainly from our cash flow.

Okay. And finally, you were talking about some increase in demand in certain nuts. Is that coming from just the consumer preferring because they're cheaper alternatives versus the other nut categories?

Typically, we would see -- if you have price inflation, you'll see a shift from higher cost nuts, for example, cashews or deluxe mixed nuts to something of a cheaper trail mix or peanuts. We've seen a little bit of that shift this year with the kind of macro environment. But we also did see some consumers leaving the snack nut category because of the higher per pound prices versus other cheaper snack alternatives like potato chips, for example. The good news is, overall, the total snack category, we're seeing it stabilize. We're getting away from some of the declines that we saw in the overall snack category. So we're hopeful that we'll get some of those consumers back into the snack nut category as well.

[Operator Instructions] At this time, I'm not seeing any further questions. And I would like to turn the call over to Jeffrey Sanfilippo, Chief Executive Officer, for closing remarks. Please go ahead.

I want to thank everyone for your interest in JBSS. This concludes the call for our first quarter of fiscal 2026 operating results. Have a great Halloween weekend.

This does conclude today's program. You may all disconnect.