John B. Sanfilippo & Son at 16th Annual Midwest Ideas Conference: Strategic Growth Focus

On Tuesday, 26 August 2025, John B. Sanfilippo & Son (NASDAQ:JBSS) presented at the 16th Annual Midwest Ideas Conference, outlining its strategic shift towards the consumer channel and its focus on expanding the bar category. While the company highlighted its strong financial performance and growth opportunities, it also acknowledged challenges in maintaining momentum in a competitive market.

Key Takeaways

• JBSS aims to increase consumer channel sales from 82% to 85-88%.
• The company is investing in high-speed snack bar lines to boost capacity.
• Annual sales reached $1.1 billion, with a steady EBITDA of around $100 million.
• The company maintains a strong balance sheet with decreasing debt ratios.
• JBSS is expanding its private label offerings, particularly in protein bars.

Financial Results

• Annual sales: $1.1 billion
• Pounds sold have increased at a 3.5% CAGR over the past decade.
• Gross margin improved from 15% to over 18%.
• EPS has grown at a 6.8% CAGR.
• Stock price has increased at a 7.7% CAGR.
• EBITDA has remained around $100 million since FY2021.
• Regular dividends have increased from $0.50 in FY2017 to $0.90 this year.
• CapEx is set to rise to $50 million in FY2025 due to new snack bar lines.
• Debt to equity has decreased by 50% since FY2015, with debt to EBITDA well below one.

Operational Updates

• JBSS operates five manufacturing facilities in the U.S., each with warehouses and distribution.
• The company manufactures over 1 billion pounds of products annually.
• There are over 75 processing lines and 40 packaging lines for nuts and trail mixes, and nine processing lines for snack bars.
• A $60 million acquisition of a mainstream bar business is set to enhance production capabilities.

Future Outlook

• JBSS plans to increase consumer channel sales to 85-88%.
• The company will maintain its core nut and trail mix business while prioritizing bar category growth.
• Private label bar growth and portfolio diversification are key focuses.
• New bar lines are expected to increase sales in FY2027, FY2028, and FY2029.

Q&A Highlights

• Private label growth is notable in both bars and core nut and trail categories.
• Younger consumers prioritize price, while older demographics seek value.
• JBSS is collaborating with retailers to introduce private label protein bars soon.
• Long-term relationships with Trader Joe’s and Aldi continue to be strategic.

For a detailed understanding, readers are encouraged to refer to the full transcript below.

Full transcript - 16th Annual Midwest Ideas Conference:

John, Three Part Advisors: Good afternoon. Our next presenting company is John B. Sanfilippo and Son. Trades under the ticker JBSS on the NASDAQ. 100 plus year old company run by the fourth generation of the Sanfilippo family, a client of three part advisors.

So if you have any questions afterwards and Frank and Jasper aren’t available or you didn’t get a chance to catch up with them, please feel free to reach out to us. We’ll be happy to set something up. Here today to lead off the presentation is Frank Pellegrino, the company’s CFO, and with him is Jasper Sanfilippo, company’s President and Chief Operating Officer. Frank?

Frank Pellegrino, CFO, John B. Sanfilippo and Son: Thank you, John. Good afternoon and thank you for your interest in JBSS. So before we start, I’m obligated to tell you we’ll be making some forward looking statements which represent our present expectations or not guarantees of future performance. So who is JBS and what do we do? Now JBSS began in 1922 as a small pecan shelling operation in Chicago.

More than a century later, this fourth generation family run business is the largest vertically integrated sheller and processor of nuts in The U. S. Now we probably manufacture our own natural brands as well as private label products from retail and food service. Focused on freshness, quality and service, JBSS offers a complete portfolio of products from recipe nuts to trail mix as well as snack bars and confection. Our annual sales this year was $1,100,000,000 and we have over 200 plus distribution in retailers nationwide.

We also take pride in our manufacturing locations and our capabilities. We have five manufacturing facilities in The U. S, which all contain warehouses and distribution and one main distribution center in Huntley, Illinois. Now we own all our manufacturing facilities and we lease the facility at Huntley. Across the network, we manufacture over 1,000,000,000 pounds of products per year.

What makes us unique? Now we have numerous capabilities and expertise that none of our competitors have. Now in our nut and trail category, we have over 75 processing lines, over 40 packaging I’m sorry, over 75 plus processing lines, 40 plus packaging lines and six different packaging formats. So we could coat a nut in numerous manners and package them in from cans to jars to small format PET jars and tube nuts. In the snack bar capabilities, we have nine processing lines.

Now we can manufacture snack bars ranging from your granola bar all the way up to your high protein bars. And we have three different packaging formats. The bars we can make extruded bars, co extruded and cold form. Now we because we’re also a branded company, now we invest money in category and consumer insights. Not a lot of private label companies make that investment.

So we’re able to look at what consumers are looking for, trends in the category, trends in flavor profile, and we’re able to bring private So we do pricing studies, we do categories, management studies, we figure out what consumers are looking for and certain price points consumers are looking for. So when we present ideas to our retailers, we present them a complete category management solution. And like John said, leaning off, now we’re over 102 years old of a company. Now we have commodity, we experienced buying commodities, our commodity buyers have over twenty five years per individual buyer buying commodities. That’s very important.

There is no hedges or future in nut commodities. So you can’t hedge your costs or buy futures. You have to be able to procure the commodities at the right price. So we process all nut types, trail and snack mixes have the highest dollar share of our portfolio of approximately 25%. This is remarkable since this is a very small part of our business in the past and FY 2016 was only 12%.

So we grew that snack and trail mix from 12% to 24% over the last twelve to thirteen years. And as a result of this product diversity, we mitigate any major impacts corporate impacts on our corporate performance because of the volatile nut market. So if there’s a shortage of walnuts, consumers tend to shift to pecans. So we’re able to provide consumers a solution if there’s an issue on an underlying commodity. In addition, we just began our bar part of our business two years ago and snack bars already account for 14% of our sales.

We have delivered strong financial performance over the years. As you could see through these four metrics, our pounds sold have increased at a 3.5% CAGR over the last ten years. Our margins have increased from our gross margin from 15% to over 18%. Our EPS has grown at a 6.8% CAGR and our stock price has grown at a 7.7% CAGR. We’ve also delivered consistent EBITDA per pound and total EBITDA dollars.

As you could see in the last three years, almost four years, we’ve been at around $100,000,000 of EBITDA since FY 2021. And FY 2025, I believe, was a near record high for EBITDA. We also like to return cash to our shareholders. As you can see, we started paying dividends back in 2015 and we pay a special and a regular dividend. Our regular dividend started in FY 2017 at $0.50 and that’s increased by nickel every year up to the current year where we’re at $0.90 And we supplement that with a dividend every year since I believe 2012 was our first year of our annual of our special dividend.

If you look back throughout our years, I think we paid over $40 of dividends since 2012. And if you look at our stock price back in 2012, I believe it was in the low teens. So our dividends has been more than three times our stock price. We also invest back in the business. As you can see, our CapEx historically has been in that 20,000,000 to $25,000,000 range.

In FY 2025, we had $50,000,000 and that was due to our investment in new snack bar lines. Now we made a very large investment in expanding our capacity in snack bars. We were buying two new high speed bar lines, which come into production and online sometime at the end of summer of next year. We also have a very strong balance sheet as you can see through these four metrics. I’d like to look at debt to equity.

It’s been decreasing at 50% since FY 2015 and our debt to EBITDA is well below one. So a very strong balance sheet, not very levered. Now we have a lot of future opportunities to grow and expand through our very strong balance sheet. So let’s look at some more FY 2025 results. This chart compares what our business looks like in FY 2015 compared to FY 2025.

The blue part of the chart is our consumer channel. The rustic looking color colors are commercial ingredients. The yellow is our contract packaging and export was our gray. So you could see our consumer business went from 60% in FY twenty fifteen to 82% in FY twenty twenty five. And this wasn’t just by coincidence, this was our strategy.

We wanted to shift business away from commercial ingredients, contract manufacturing export into the consumer channel where you have more value added products and you have more predictable profit margins. So if I will predict what this looks like in five or ten years from now, consumer will continue to grow. It’s at 82% and we would like to see this more between 8588% in the future. Now we really want to continue to grow the channel that offers us the best profit profile. The consumer channel last year grew at 4% of sales to over $9.00 $7,000,000 The growth was driven by our private label snack bars.

Now we had some nice wins in e commerce on our brands we had some nice wins at club store for our OVH brand. Commercial ingredients channel now shrunk by just 1% to $109,000,000 This was mainly driven by some aggressive pricing from our competitors and we are deprioritizing our industrial business. And when I say industrial, that’s us selling our products to other food manufacturers. So that tends to be high risk and low margin. So we’re shifting those commodities into the consumer channel.

So if you back out the decrease in the industrial piece of this channel, commercial ingredients would have increased. And our last channel is contract manufacturing. This is a channel where we focus on utilizing excess capacity. Now this channel grew by 8% driven by increased contract with a key customer on bulk granola. So we’re able to toast granola and then sell it to a granola bar manufacturer who uses this granola to make granola bars.

And then we also picked up a new customer in Coman for our for our nut mixes. So again, we’re not actively looking to grow this channel. This is more of a capacity utilization channel. So this is a chart I’d to present. This shows the impact of the commodity cost to our gross margin.

So the bars are our gross margin, the lines are the underlying commodity cost. And what we’re trying to demonstrate here is that even though there’s volatility in the commodity cost, we try to maintain a very consistent gross margin percentage. Now you could see in December in the last couple quarters that gross margin has come down and that’s mainly due to our bar business. The bar business now has an impact on our gross margin percentage. Now if I backed out the bar business, those columns will also probably be close to the June 24 numbers.

So this is how we manage our commodity risk. And like I said before, there isn’t a market where you can hedge or fix your cost. So what we do in our consumer channel is that we have the right to review pricing every six months. And that helps us mitigate any sort of underlying commodity increases that we may face. So we’re able to pass pricing along now every six months.

And that has helped us deliver consistent margin over time. The last two couple of slides are focused on retail, what we’re seeing at the retail. So the first chart here is for our NUC category and you could see that the category in pure dollars is kind of flat to shrinking. If you look at FY 2023 to FY 2025, between 2024 and 2025 it has increased in dollars. But if you now look over to the side, the actual pounds have decreased.

So it’s more inflation driven increases in dollars. The actual category is not growing as you can see the pound sold have remained consistent with FY ’24 and ’25, but now have shrunk since ’21 and ’22. And the bottom chart kind of demonstrates why the average price per pound is at $6.12 per pound, which is the second highest in the last five years. It was at $5.87 in FY 2021. Now we compare and contrast this to our bar business.

The bar category has grown in dollar sales and has also increased over time in the pound sales. And the price per pound is also going up, but the main driver here is that the increase in volume is based on the higher end bars like your protein bar that tends to have a higher selling price per pound. So if you factor out the increase because of the protein bars, the actual price per pound for your mainstream bars, which are granola bars, your fruit and grain bars have been pretty consistent over time. With that, I’m going turn over to Jasper to walk you through some more of our FY 2025.

Jasper Sanfilippo, President and Chief Operating Officer, John B. Sanfilippo and Son: Thanks, Frank. Good afternoon, everyone. So we’ll dive into a little bit more detail of what we did in ’twenty five and then talk a little bit about what ’twenty six looks like. So we run our business based on three channels. We’re always looking to expand consumer reach.

We always want to create value with our key customers, and we also want to grow our JBS brands. And we’ll talk specifically about some accomplishments across these three pillars. So on the expand consumer reach, we’re always looking to get new distribution at existing customers. But what we have seen a pretty long term trend now is food is just ending up in a lot of new places that you just never saw before. We see it at hardware stores.

We’re seeing it in vending machines and places that you wouldn’t see, more college campuses. So through both our consumer channel as well as our commercial ingredients channel, we’re always trying to open doors and get food where consumers are buying them. And so you can see we gained some additional business at existing customer with our brand with our bars, expanded some partnerships that we have, getting into college campuses in a little bit more difficult places to unlock that distribution. The creating value with key customers, obviously, we’re continuing to push and grow our bar business with existing and new customers, doing the same thing on the core Nut and Trail. And on the brands, really making sure that we set the stage for continued support and growth on the brands, both with new packaging changes as well as new innovation.

So we’ll talk a little bit about our top two brands performance. Frank touched on it a little bit. So Fisher recipe is our largest brand. The categories you could see, which is the red line, has bounced around. Typically, in terms of category growth, you could see that we have lost a little bit of distribution, and it’s mostly distribution, not velocity of the category so much.

But what we haven’t seen here is the nuts that we use for that Fisher brand. We just moved that into some more private label. So we still are participating in the category at a higher level than what we had been traditionally doing, but it’s now a mix of our branded distribution as well as private label distribution. And then on the OVH side, a better story. We’re up 11% with our volume.

You could see the category is a little bit more stable here than what you saw with the recipe category. Again, working on a lot of new distribution, a lot of new innovation, getting a lot of good partnerships that we haven’t typically done before. This brand has a tendency to resonate more with a younger consumer, which is what we wanted the brand to do, a more health conscious consumer. And we’re really seeing some pretty terrific results with it. As Frank mentioned, when you look at our overall business, we are predominantly a private label supplier.

83% of our business sits with private label. Only 17% sits within our branded portfolio. And then when you look at that 17%, you could see between Fisher snack and recipe, that is 60% of our branded sales. OVH is 21%. And then all the other brands, the Hunter Mix, Squirrel, they’re only 12% of that, 17%.

So again, really laser focused on private label. But we also are going to support and invest wisely into our brands as well. Frank touched a little bit about category growth. So we’ll first talk about the nut and trail category. So again, the line red lines are the category performance overall, and then the bar graph is our volume.

Then you could see, right, coming out of the COVID area, the category, as things return more to normalcy, you saw the category start to decline, flatten out for a while, then it’s starting to pick up a bit now. That’s pre tariff. So obviously, we start executing price increases and making things reflective of any cost of tariffs or any other price increases, that’s our pretty they have a tendency to, you know, trade up and down with volume as it relates to elasticity of our pricing versus the consumption. Part of what you saw with the category rebound here is in ’24 as we worked very hard with our retailers, changed some of our pricing strategies to get the growth in the category back. It was sliding pretty significantly.

One of the big reasons was we were offering price concessions to our retailers, but they were still just margining up and not reflecting those new prices at retail. And so it did hurt consumption. Retailers at the time didn’t care. They saw their category down go down, but they were making more money, so they just didn’t really care. And finally, when they saw the traffic in their stores and their categories really, really performing poorly, it finally got the attention of them, and they started reflecting lower retails, which started increasing the volume again in the category.

We were glad to see that. Our category is a different story. You can see that the category was slightly declining in ’twenty three, then it popped back up in ’twenty four and then declining again in ’twenty five. It’s kind of misleading because within these numbers here, you have a large recall from one of the large bar manufacturers, and that did cause an anomaly here. But you could see from our bar business, it continues to grow in ’25.

We’re at about a 27% growth for that category. Now it’s a little misleading because we had one less quarter in ’24, but we’re continuing to see a lot of demand for our bars in the categories performing well and private label growth within the categories really growing very strongly in double digits in a lot of cases. So talking a little bit about our longer term strategy. We got a lot of questions about that. So what’s the best way to look at where our focus is going to be?

So for us, it’s really kind of hold and maintain our core Knot business. It is obviously very important for us to maintain that. We’re not going to lose focus on it, but we’re not going to prioritize core nut and trail over our opportunities that we see with the bar category. It’s also when we first decided to get into the bar category, you know, we were always concerned about the demographic of who’s consuming corn, not in trail, and they had a tendency to be older and very limited with respect to are they on fixed income, are they not, are they gonna be able to, you know, continue to support this category. The younger the younger demographic is always accustomed to us.

They first really get used to us, whether it be in peanut butter or in candy bars, right? But they’re not very likely to go out and pick up a package of nuts. And so that’s a lot of our focus, is making sure that our customer base is reflective of all the demographics and not just overweighted in a certain one. So we’re kind of maintain our core Nut and Trail business and be laser focused on growing our bar business. It’s the biggest single opportunity we have.

We have picked up a lot of distribution. In fact, I’m trying to think of any customer that did not take any of the new items that we offered, and it’s and I can’t think of any, quite honestly. I mean they’re very hungry about growing their bar category. So you can see here, this is a chart showing what private label share is in the categories. So if you were to walk down a traditional grocery store, about 20% of what you would see in that aisle is private label.

You could see on the Corridor Dutton Trail, you walked on that same aisle, 55% of that aisle is now private label. 55, way over indexes relative to the average for the store. On the flip side, you see if you walk down the bar aisle, only 12% or 11.7% is private label. This is why we’re so focused on this category. It’s a $10,000,000,000 category.

It’s growing at 5%. Private label share is growing even more than that. And there’s so much more opportunity just to get that 12% to what average would be in the store. Retailers are laser focused as well, wanting to grow their private label brands. They want to see more of their offerings across all of the store.

And they recognize that the bar category is under indexed in their stores, and they’re doing everything they can to get that private label share back up. So when we look at the bar category, the pie chart on the left shows you how the category looks as it relates to the type of bars that people are buying. Right? So you can see the nutrition bar set, which would be a Cliff kind protein bar, is the largest portion of that category. The mainstream bars would be something like Fruit and Grain and Chewy, so 30%.

So it’s still an important part of the category. All other would be just kind of like the Lar bars, the Fruit bars, things of that nature. And then you have the kid friendly, which is also actually a very growing trend too, is a lot of retailers and a lot of brands are starting to design products for the younger generations. Been very successful launch for us when we lost kids energy bars as well as kid protein bars now. So you’re going to start seeing a lot more offerings for younger generations in the bar category.

So that’s what the category looks like from a volume perspective. The middle one is what our business looks like. And you could see 24% of what we have is mostly I’m sorry, most of our business is mainstream bars. A lot of that came with the acquisition, right? When we built out our capability in bars, it was in the nutritional side.

But the business that we acquired in ’twenty three really was a mainstream business. So we’re focused now on making our bar business look more like the categories business and get away from the mainstream and start growing more of the nutrition and kid friendly offerings. And so when we look at what do the future pillars look like, so again, this is what we’re gonna be focused on, laser focused on growing and expanding our private label bar growth and diversifying that that portfolio as well, not just sell on mainstream bars, making sure that we’re selling the entire platform. Because that was one of the reasons why private label was so low is the consumer did not have a choice at many retailers to buy a private label Clif Bar or to buy a private label protein bar, right? So just getting those sets correctly at those retailers is really where we’re focused.

And then maintain our private label core Nut and Trail business. We still want to focus on our strategic customers. We have a handful of them. There’s still opportunity for us to grow business with them, both with distribution that we currently don’t have with some of those retailers as well as putting more products in different parts of the store where we see consumers looking for alternatives. Then be selective about how we want to support our brands.

A lot of the brands in our space currently are not performing well, including some of the biggest ones. So we want to be smart about where and how we support our brands. And that’s really what we’re going to be focused on for this year and for the foreseeable future. I think with that, we are at the end. I believe we’ll open it up for questions.

I want to thank everyone for attending and listening to us. So if you have any questions, just please feel free to ask. Yes? Yes. So private label is growing share both in bars and in corn, nut and trail relative to the brands for sure.

The brands are down, in some cases, almost double digits. So the consumers are looking for those cheaper alternatives. The other thing that we saw as well with consumers is the younger generations are looking for absolute price points. So they’re trying to find the cheapest thing on the shelf to get a healthy snack out of. So it could be a two ounce or four ounce, something smaller in pack size, but absolutely has lower dollars, where the older demographics are looking for the best value.

Right? So they’re looking for the $24.32 ounce where the absolute cost per ounce is the best deal. So really where we saw the softness in the categories in the middle. It’s that six ounce to 16 ounce packages is where they left, and they’re kind of moving to the ends.

Unidentified speaker: Where are you on the protein category? I’ve now seen not to have protein, but I added protein thing, protein bars. What brand do you like to put there?

Jasper Sanfilippo, President and Chief Operating Officer, John B. Sanfilippo and Son: So we’re working really with all the retailers on protein. That is one area where you do not see a lot of private label opportunities. So last year, last summer, Abbott Nutrition shut down one of its brands called Zone Perfect, and we were able to go in there and buy two protein bar lines that they were operating with. We have installed one in our Elgin facility now. It’s currently temp to run Chewy because that’s where from a capacity constraint standpoint, that’s where we are most capacity constrained.

But about six months from now, we’ll actually convert that into a protein, back to the protein bar line. It was when we bought it. You’ll start seeing protein, private label protein bars in market March ’7. So we’re already working with our customers. We’ve already, through the pilot plants and through our labs, already have developed, I think, probably top four or five protein bar offerings.

And again, our strategy is always take the top two or three brands, take the top two or three flavors and create emulators against those items. And then look at maybe some of the other harder technologies in terms of innovation. But we want to get the set correct first.

Unidentified speaker: Yeah.

Jasper Sanfilippo, President and Chief Operating Officer, John B. Sanfilippo and Son: Sure. It’d be like a kids energy. So you’ll start seeing kids energy, which is really a Chewy bar, but it has added protein in it for kids as well as adults. Kids require less protein, so it’s not like some of the heavy protein that an adult would look for. But yes, there is a tremendous amount of excitement and demand for protein related offerings.

It’s okay. Thank you.

Unidentified speaker: Yes?

Unidentified speaker: Would you please talk philosophically about your thought process of focusing on private label rather than developing your own brands? I think many of us think of brand as having more value over a multiyear time period. Sure.

Jasper Sanfilippo, President and Chief Operating Officer, John B. Sanfilippo and Son: Well, I’m Sure. Some of this?

Frank Pellegrino, CFO, John B. Sanfilippo and Son: So if you look at the current consumer landscape, private label is really growing share. So if you look at no, I think Jasper had a slide there on the nut category. If you saw that slide let me go back there. Let’s see. It’s a slide.

Here, the private label snacks at 55%. If you look at this slide last year, I’m not sure if Jasper mentioned, it was only at 47. So private label is really growing share. If you look at what retailers want to do, the Walmarts and Targets of the world are looking at what Aldi’s and what Trader Joe’s are doing and how they’re capturing consumers in their store. So if we look at Trader Joe’s, they have everything they do is Trader Joe brand.

They only could find that brand at Trader Joe’s. So they have a captive consumer. So consumers going to that store for that brand and then shopping throughout the store for a grocery list. A brand you could find in any store. So consumers could go from store to store and not become store loyal.

So I think that’s what retailers want to do is make sure they capture consumer only to go to their store because they only could find that at their store. And that’s kind of like the European model. If you go to Europe, it’s mainly private label. The brands are not out there. So I think the mainstream retailers in The U.

S. Will eventually get to a point where they have one major category brand, say for Nuts, it could be a planners who have it, who bring consumers down the aisle. But once the consumer is down the aisle, they want that consumer to pick the private label because it’s right next to the brands and it’s a 20% value. So you want the consumers to walk down the aisle, but then they want to choose their private label and not the brands. So that’s why we’re shifting our strategy towards more private label because if you look at Europe, it’s already private label.

If you look at success at all the Ontario’s have in The States, it’s on private label. And retailers make more money on private label. So I think that’s where I think The U. S. Will eventually get to the next five or ten years, and we’re going be there to drive that change.

Jasper Sanfilippo, President and Chief Operating Officer, John B. Sanfilippo and Son: Yes. I think it was a little bit of that. Again, though, we didn’t really lose the distribution. It just went from Fisher branded to private label recipe as well for us. So typically, these retailers will put out their private label business once a year based on when the commodities come in.

And so it just happened to be a year where they had some more attractive pricing from the private label side than we were able to give them on the Fisher recipe. They kind of use the brands as to get people down the aisle, but they really hope when they get down the aisle that they buy the private label. Yes.

Unidentified speaker: When you think about the snack bar category or just the bar category generally,

Jasper Sanfilippo, President and Chief Operating Officer, John B. Sanfilippo and Son: Yeah. I would think, you know, can it get beyond the 20% that you’d see on average? I think time will tell. I know the retailers certainly want to get it beyond that 20%. I don’t think you’ll ever see it as high as what we have in the Core Naughton Trail.

Bars in general are far more manufactured, right? There’s not a tremendous a lot of value in a raw walnuts or a raw almond, which I think consumers could easily swap into the private label. But at minimum, it’s going to get to 20%.

Frank Pellegrino, CFO, John B. Sanfilippo and Son: Question over here?

Unidentified speaker: Yes. What can you tell us about the sales earnings and cash flow next year and maybe

Frank Pellegrino, CFO, John B. Sanfilippo and Son: the third of this year? We don’t provide guidance, but you can look at 25,000,000 compared to 26,000,000 There really isn’t anything dramatically changing our business from 25 to 26,000,000 So we think it should be pretty consistent with historical trends. Now as far as EBITDA, the last three or four years, we’ve been well over $100,000,000 So I don’t anticipate any issues that will cause us to not follow our historical trends. The bar the new bar lines will come in line in our FY 2027. So you should see increased sales as we start filling up that capacity in ’27, ’28 and ’29.

Unidentified speaker: Will you guys you mentioned Trader Joe’s and all these a couple of times. Will you guys talk about your relationship there with them?

Frank Pellegrino, CFO, John B. Sanfilippo and Son: Sure. Talking to them more.

Jasper Sanfilippo, President and Chief Operating Officer, John B. Sanfilippo and Son: So we’ve been doing business with both of those retailers for a very long time, like twenty plus years. Typically, they’re very loyal to their supplier base, more so Trader Joe’s more so than than Aldi. But we only selectively participate on on different pieces of their business. So I would say we probably only have like 10% of Trader Joe’s business, maybe less than 10% of Aldi’s business. Now I think we probably have a higher percent share on the private label bars that we’re doing with them.

Both are Aldi’s pretty transactional. In fact, there are certain bar categories that they run the auction out of Europe as opposed to The U. S. Trader Joe’s is a much more innovative, much more collaborative partner with us, particularly around the knot and trail side of it as well as the the bars that we’re learning.

Frank Pellegrino, CFO, John B. Sanfilippo and Son: And they’re also growing. You know, look at some other retailers out there, some mass merchandisers. They’re having troubles growing. Those two retailers are successfully growing their footprint and their their sales.

Jasper Sanfilippo, President and Chief Operating Officer, John B. Sanfilippo and Son: Yes. Is it a special dividend formulaic or is it

Unidentified speaker: more or less ad hoc?

Frank Pellegrino, CFO, John B. Sanfilippo and Son: It’s in between. So it’s like we have a capital allocation policy that goes through five different triggers. Now again, not to go into details. Number one is we have to make sure we finance the crops we buy from growers because the cash conversion cycle is nine to twelve months because you buy those in shell and then shell it. Now we want to make sure we increase we want to make sure we pay and increase our regular dividend every year.

The regular started at $50 last this year was at $90 We want to make sure we allocate enough cash to CapEx. We want to make sure we allocate enough cash to any M and A opportunity. And then the last one is a special. So if there really isn’t a big M and A opportunity and commodity prices are behaving and CapEx is normal, the odds of a special dividend is high. Now even with the $50,000,000 CapEx we spent in ’25, we’re still able to declare a $0.60 special last month.

So it’s very likely we will continue having specials unless the commodity prices really fluctuate or there’s a large M and A deal that we have to allocate resources to. We just like the flexibility to make sure we allocate our capital in a manner we think drives shareholder value the most.

Unidentified speaker: On that point, can we touch briefly on the acquisition you did last year, just kind of the logic rationale?

Frank Pellegrino, CFO, John B. Sanfilippo and Son: The Lakeville Lake yes. Again, that was our no, we were already doing nutrition bars and allergen the Cliff version and the Kind Bar version. The Minnesota acquisition got us into the mainstream bars as we talked about, the granola, the fruit and grain, oats and honey, high fiber. It was a, I would say, a far sale. It was 140,000,000 or $150,000,000 sales.

We bought it for $60,000,000 included a building five manufacturing line. So it was an opportunity we couldn’t pass up. The facility was losing money, but now we’re able to make turn that around within twelve months and that facility is not losing money any longer. So no, it sped up our diversification. We want to get into bars.

It probably got into mainstream bars probably two years before we wanted to.

Unidentified speaker: What do you expect the return

Unidentified speaker: on that investment to be?

Frank Pellegrino, CFO, John B. Sanfilippo and Son: The bar line? No, our We should be that’s probably a payback period probably around probably four or five years. I think that’s I think we’re out of time. So, again, thank you for all your questions. We appreciate

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