Treehouse Foods at William Blair Conference: Navigating Growth in Private Label

On Wednesday, June 4, 2025, Treehouse Foods (NYSE:THS) presented its strategic direction at the 45th Annual William Blair Growth Stock Conference. Amidst a challenging food industry landscape, the company highlighted its focus on growth in the snacking and beverage categories, particularly within private labels. CEO Steve Oakland discussed both the company’s solid first-quarter performance and the macroeconomic pressures it faces, such as inflation and softer consumer volume.

Key Takeaways

• Treehouse Foods is targeting growth in snacking and beverage categories, with a focus on private labels.
• The company reported a solid first quarter despite inflation and softer consumer volume.
• Treehouse Foods is investing in capacity, data, and insights to become a leading partner in select categories.
• CFO Pat O’Donnell highlighted initiatives to improve profitability, including supply chain optimizations and cost structure streamlining.
• The company reaffirmed its 2025 guidance, with expected net sales between $3.34 billion and $3.4 billion and EBITDA ranging from $345 million to $375 million.

Financial Results

• 2025 Guidance:

- Adjusted Net Sales: $3.34 billion to $3.4 billion

- Volume/Mix: Down approximately 1%

- EBITDA: $345 million to $375 million

• Key Drivers:

- Positive impact on sales from the Harris Tea acquisition

- Margin management activities, including exiting lower profit/complex volume businesses

- Recovery from early-year supply chain disruptions at the Griddle Facility

Operational Updates

• Supply Chain Initiatives:

- Implementation of the TreeHouse Management Operating System (TMOS) for continuous improvement

- Procurement cost savings through better deals on ingredients and packaging

- Logistics network optimization to reduce transportation costs and improve service

• Margin Management:

- Maximizing plant utilization and optimizing pricing architecture

- Aligning price pack architecture with branded products

• Cost Structure Streamlining:

- Organizational changes to reduce divisions and management layers

- Establishing centers of excellence/shared services for administrative functions

- Closing the creamer facility to eliminate overhead

Future Outlook

• Capital Allocation Priorities:

- Investing in organic growth through capital expenditures and inorganic growth via acquisitions

- Maintaining a strong balance sheet by reducing leverage

- Returning capital to shareholders through opportunistic share repurchases

• Tea Business Investment:

- Harris Tea acquisition to enhance sourcing, blending, and packing capabilities

- Recognizing growth potential in the fast-growing tea category

• Margin Management as a Multi-Year Initiative:

- Focus on efficiency and profitability regardless of market conditions

- Proactive measures taken in late 2024 and early 2025 to optimize the business

Q&A Highlights

• Guidance Philosophy:

- Treehouse Foods guided a flat midpoint based on controllable factors, such as plant execution and known demand

• Consumer Behavior:

- Noted a decrease in units purchased per grocery trip due to increased grocery prices and uncertainty

- Private label performing well relative to branded products, despite a soft overall environment

• Margin Management Sustainability:

- Margin management considered essential and will continue to be a focus

In conclusion, Treehouse Foods is strategically positioning itself for growth in private label categories while managing profitability through operational enhancements. For more details, refer to the full transcript below.

Full transcript - 45th Annual William Blair Growth Stock Conference:

John Anderson, Analyst, William Blair: Okay. Good morning, everybody. We’re gonna get started. I’m John Anderson, the analyst at William Blair that covers consumer staples, and, that includes Treehouse Foods. So thanks for joining us for the Treehouse Foods presentation this morning.

We’re pleased to have, chief executive officer Steve Oakland and chief financial officer Pat O’Donnell here to present. As a reminder, TreeHouse is a leading private brand food manufacturer in North America. The company participates in a wide range of categories and product types from opening price point to national brand equivalent to national brand better, making it relevant to a wide range of retail customers and end consumers. Over the past few years, TreeHouse has undergone a transformation, which we believe has focused the portfolio, established stronger operating capabilities in the business, and improve the balance sheet, creating capital allocation options. As such, we think 2025 should be a pivotal year on the company’s journey to restoring more dependable profit growth.

I have a couple of disclosures I have to make here before handing it over to management. Immediately following the presentation, there will be a breakout session in the Jenny A Room. So join us for that if you can. And last, I need to inform you that a complete list of research disclosures or potential conflicts of interest can be found on the William Blair website. With that, I will toss it over to Steve to get us started.

Steve Oakland, Chief Executive Officer, Treehouse Foods: Great. Thank you, John, and good morning, everybody. Great to be here. I think I am driving. Is that correct?

Maybe not. There we go. Obviously, we John spoke to the forward looking statement, which is always available both on our website and on theirs. And we’ll get started. So, you know, when we thought about this, and we participated over the years in a number of growth conferences, we thought about when you put the a food business in a growth conference right now, you’d look at yourself given what’s going on in the food industry, right?

You know, top quartile is flat in the food industry right now. But we think that’s not, you know, obviously that’s not historically been the case, and we don’t think it will be the case long term. But we do think it’s an opportunity, a really unique opportunity both for TreeHouse and for the investor group. So we’ll talk a little bit about that today and how we’re running the company different in a time of disruption and how we’re trying to make that as take advantage of that, quite frankly. Right?

We think there’s some really neat opportunities right now. So there are people in the room that I recognize that know the story really well, and there are people that don’t know us at all, I know, in the room. So we will do a couple slides as we get forward to give you a little benefit of of who are we, what’s our story, and then we’ll jump into what we think the opportunity is. So couple of key takeaways. Right?

Snacking and beverage have been some of the best categories in food and in food and bev over the long term. Right? In particular, private label has and I’ll show you some a little bit of data on it, one slide of data in a second. But has grown in the categories in which we participate for a couple of decades. Right?

So they’ve been really solid growth categories. We’ve been able to reshape ourselves into those growth categories over time. You know, and then, you know, ’25 we’ll talk about. We’re running the business slightly differently today, given the environment that we have with inflation and tariff pricing and all all the stuff you hear about the pressure on the consumer and softer volume across the entire food landscape. But solid first quarter and and we feel really good about the way we’re running the business regardless of the macro backdrop.

Okay. If you the key takeaway from this slide is private label penetration continues to grow. If you give the consumer, you send them home, tell them they can’t they have to stay home and you give them a trillion dollars of stimulus, you’ll slow the category. Right? Which is what happened in 02/2021.

Right? That the only time we’ve seen this disrupted is is during the COVID stimulus period, when we sat people at home and we gave them all kinds of disposable income. Right? So so that and we rebounded immediately afterwards. So very solid category growths, like I said, for a very long time, for a couple of decades.

And where does that growth come from? It comes from both the consumer and the retailer. Private label is growing across virtually all age groups, income groups, demographic groups. And you see that with the and I’ll talk about it in the retailer in a second, but you see it particularly with the next generation, with Gen Z and Millennials, where we have some of the highest penetration and some of the fastest growth rates. So the good news for us is we’re not trying to to chase a generation, we’re not trying to convince anybody.

I think our retail partners are doing a great job of using private label as one of the arrows in their quiver to build loyalty and traffic. Right? You can buy branded a particular branded item on your phone, you can have it delivered by the time you get home, you know, you know exactly what that’s gonna gonna cost. Those unique experiential items that are only available in your retail under their in your retail or under their brand are key to that loyalty equation. And you see that with some of our largest retail partners.

You know, the fastest growing customer in private label across the country is Walmart. Right? Which is unique because they they for years were focused on, you know, we’ve all seen the rollback ad where they roll back a private a branded, something that everybody understands they roll that branded price back was their their key feature advertising campaign. But now they understand that they need to have both an opening price point private label and they need this recent launch of Better Goods, which is the largest launch in private label in history in The United States. So they’ve got they’ve got both an opening price point and a value based private label offering as well as a premium private label offering.

But you see, you know, Albertsons, Kirkland, obviously Costco, incredibly powerful and a much higher demographic income demographic. Aldi is the fastest growing from a retail store penetration. Right? Their purchase of Southeast Grocers, they’re converting hundreds of stores to Aldi stores. We only put four on the slide, but you can say the same thing about Target, you can say the same thing about Whole Foods, you can say the same thing about Trader Joe’s.

Right? So retailers, private brands are proliferating across the landscape. So there’s a lot of opportunity for us. Another little who are we? We are now 3,350,000,000.00.

We manufacture basically 26 categories across 27 factories or 20 excuse me, 16 categories across 27 factories, and and we serve virtually every customer in North America, every retail customer. And then, I spoke about categories. Our largest and and probably our the category where we would be the best is baked snacking, and that would be cookies, crackers, pretzels, and a small candy business, where we provide crackers both to the North American customer and and actually some global customers. Right? We have some capabilities that are unique globally.

Right? What we do there. Our coffee and tea business is a place we’re investing. It’s a great category for private label, both coffee and tea. We made an acquisition in tea that closed in January.

It’s off to a great start, which makes us the largest private label tea manufacturer. And then our coffee business, we’re investing in and and we see great opportunity for that over the long term. Aseptic beverages, most of our business is aseptic broth, which is a very high private label penetration category. There’s a lot of private label share there. But the aseptic capability is incredibly valuable in our space, incredibly difficult to run, which which means it can be, if done right, a really nice opportunity for for our for our customer partners.

We have a dry blend business, basically hot cereal, which is instant oatmeal, a pickle business, and then in refrigerator and frozen, we have convenience breakfast, which is a great a great opportunity for us. So before I turn it over to Pat, I’ll talk about the things we sort of control and the things we don’t control. I showed you the slide for the core growth, is category performance over the long term. We think that’s and and when you combine that with the consumer and the retailer effort against our category, we think that gives us a nice opportunity. That is clearly slower.

I’ll show you a slide in a second. That has clearly slowed down, but still solid versus our branded competitors and and versus the other alternatives in the category. And you’ll see penetration and then the investment that the retailer makes, obviously, we don’t control but we support. But on the right side of the slide are the things that we do control and and we call it advantage capabilities. The key in this business is to be the go to partner in a category.

And I think if you look at crackers, we are clearly the go to partner. We are the go to partner in tea. We’re the go to partner in a septic. So, well, there’s a number of these categories where we are there now and there’s a few more where we’re making investments to to be that go to partner. Right?

And we do that with capacity, we do it with with data, we do it with insights. And then, you know, most most recently, we talked about margin enhancement. We tend to be the most profitable where we’re the deepest, where we have the best capability, and where we are that go to partner. And quite frankly, we probably spread our our resources too thin. We we had some smaller pieces of business that were more complex than than necessary.

And we we’ve we’ve actually taken some business out of our portfolio this year. We used this slow period of time to consolidate some stuff, to close some we’re closing a factory. We’re doing some things to to position the business to lever as the growth comes back. Right? We think our margins will lever nicely.

So, you know, I I look at it as the left side is is the environment, which is very favorable for private label, but we don’t control it, and the right side we control. And those are the things we’re focused on. So I spoke to the categories and and those of you who follow the food business understand that the consumer is pressured, there’s been a lot of inflation. The black bar is private label, the gray bar is branded. And as you can see, branded units have been negative across, you know, a number of quarters.

Private labels performed incredibly well against those. If you look at q one, there’s a little noise in q one and I think we’ll once we get q two out, we’ll be able to show this. There was an Easter shift. Right? And when you move Easter, that’s if you move thanks you you don’t move Thanksgiving, obviously, it’s always the same period.

But if you look at the acceleration of those key holiday periods, there’s a lot of volume difference and the timing of retailer promotional volume, all of that affects that. But I think the trend is true. I think the consumer is pressured. The consumer is buying less units on every grocery trip. The good news is they’re buying private label at a better pace than they’re buying brand.

Right? So I think we’re performing really well in a little tougher business. And we saw we normally don’t give mid quarter numbers. Right? But we saw the the category bounce back in April, which does reflect the the timing shift with Easter.

That’s why we right side there. I met I mentioned briefly that we’re running the company differently. We have really challenged our the complexity in our system. Right? And and we’ve actually reduced some volume in some businesses.

We’ve taken some lower margin, more complex items out of ours. There’s probably a smaller, more nimble vendor that can serve that more aggressive, more cheap more cheaply than we can or or more effectively than we can. And and that way we’ve been able to optimize both our cash and our our margin position across the business. We’ve we’ve really looked at how we’re organized to serve the customer. And candidly, you organize differently in a lower growth environment than you do in a high growth environment.

And so we saw a glimpse of that in the fourth or in the first quarter and we look forward to that flowing through and that’s that was reflected in our guidance and Pat will speak more to that as we go forward. So we see an opportunity for ’25 to be a profit and cash year given the environment that’s around us, but we will we are making the investments to position the business, so as the volume comes back, that it will lever and be more profitable going forward. So with that, I’ll take the pad.

Pat O’Donnell, Chief Financial Officer, Treehouse Foods: Sure. So I’ll pick up where Steve left, which was really focusing on what are we doing to execute on the profitability improvement plan. And so we’ve got a couple initiatives that we’re working on, and I’ll talk through each of these kind of three structures that we’re thinking about. So the first is our supply chain initiatives. And so you can think about this as the normal productivity type initiatives that you would expect in the supply chain.

We think about TMOS, which is our treehouse management operating system. Think about this as ongoing process improvement, continuous improvement type activities in our plants. It’s the goal there is to run better, do the maintenance, engage your workforce, eliminate scrap. And I think we’re seeing where we’ve done material implementation of our TMall system, we’re seeing significantly improved OEEs in our plants, which means they’re running much better. You’re getting more capacity out of some of those plants.

And in some of our categories, that’s important, where we have more limited capacity or capacity constraints, and so that’s allowing us to run better in those places and have less waste. So we’re pleased with the progress we continue to make there. I think it’s also important because it allows our manufacturing plants to be reliable and more stable as a part of where we’ve got that TMOS implementation done. The second part of that would be the procurement cost savings. And, you know, this is an area that we’ve been generally very pleased with over the last twenty four months or so that we’ve been implementing this work.

I think a lot of the margin improvement we’ve seen on a year over year basis is driven by the procurement cost savings work. And this is just getting after ingredients, packaging, you know, the kind of direct cost that we have within our cost of sales and bidding that out. So we’ve had really nice success. I think this, when you think about a private label business across categories, this is where I think scale matters to us. And so when you go and you go negotiate on packaging across those large vendors and you’re bringing that total volume, I think that’s where we can really leverage the breadth and scale of TreeHouse, and I think we’re seeing nice results through that.

We also have a nice pipeline that we started last year that’s continuing to pay off this year in terms of wrap savings, and then a really strong pipeline of opportunities that we’ll execute on this year that we’ll continue to pay next year and into 2026. The last bucket to think about would be our logistics network. And so one of the areas that we’re focused on is, you know, we have probably too many points of distribution within our network, and some of those are not close enough to the customers. And so this is probably the area we’ve done the least amount of work on. We’ve done some planning.

We’ve not yet gotten into all the execution. And so think of this as less inventory locations throughout our network, but put them closer to the customer, you’re driving less miles, you’re managing your inventory a little bit better, and you’re improving service for that customer by putting them closer. So we will get after this work over the next year or two and start to generate some savings through that. The next area that Steve talked about was margin management, and I think of margin management in a private label business a little bit different than you might hear it used in a branded space. And so there’s a couple elements to this.

One, we want to maximize utilization within our plants, and and with that maybe eliminating some complexity along the way. And so we are able to service a wide range of customer needs. Steve made reference to that on the customer page, But not all subcategory volume runs the best through our system. And so we want to make sure where we have complexity, you know, it is either justified by price or does run well in our network. And so we’ve spent some time this year trying to ensure, you know, we have the best volume flowing through our plants, particularly in those categories where we do have some capacity constraints.

We want to be able to run well, we want to be able to service our customers, we want to make sure we’re getting the right market rate on that. And so we’re going go maximize the utilization of our plants by doing that with less downtime and executing better. Pricing is another spot where we want to make sure, both from a pricing architecture as well as, you know, where we have constraints deep capability that that is reflected in the value add that we’re providing to the customer. And so this is having the right conversations around where are we deep and how do we manage that. And I think our margins generally are better, as Steve said, where we are deep in those categories.

And so we’re seeing that start to play through as we have the right allocation and work with our customers. We’ll also look at price pack architecture and some of those types of things, ensuring the private label offering is matching up against what the brands may be doing as well, and that we’ve got the right offering on shelf for our customers. The last bucket of work to think about would be the streamlining our cost structure. And so you may have seen in early April, we did make an announcement around some organizational changes. So the first part of this will be, you know, how do we improve our go to market?

And so we looked at our structure and recognized we were perhaps too inward focused, and so we needed to reduce the number of divisions as well as a certain amount of management. And this was done with the intent to be closer to the customer and be more customer focused and eliminate some spans where we could speed decision making and action on behalf of our customers. It will also generate cost savings, but I think the goal here was to be closer to the customer and really be more customer friendly from a service standpoint. We’ll also look at how do we operate very lean from an organizational standpoint, and think about this as things like centers of excellence or shared service type activities, both on the, you know, perhaps on some of the customer administrative work as well as, you know, back office type activities. We do some of that today and we think we need to do more in the future and that will generate cost savings for us as we go forward and really be focused on what is the right, particularly SG and A and perhaps the corporate COGS element of what we use to support our plans.

And then lastly, we want to look at our maximizing our manufacturing network. And so there’s probably a couple elements to this. We’ve made some recent announcement of closing a creamer facility as an example. That’s a great category for us in terms of, you know, we own a lot of the capacity there. Not a growing category, but a nice margin category for us over time.

And so by eliminating some manufacturing overhead, we’re able to serve the same volume and with less overhead. We have probably a couple opportunities to think about that. We also looked at the ready to drink coffee business as one that we chose to exit and eliminate some of that overhead as well. It was a great branded category. It’s not been a great private label category.

So earlier this year we made that announcement to do it. So we’ll continue to look at the portfolio. But we think when you look at these in total, this does provide that opportunity that regardless of what happens from a consumer standpoint, there’s a lot that is within our control that we can do to go drive profit and cash flow, and then these are the levers that we would use to go do it. If I then turn to that concept of cash flow allocation, I think John said in his opening remarks, I do think the work that we’ve done to improve our balance sheet over the last several years and to reduce leverage has opened up some different opportunities for us from a capital allocation standpoint. Our number one priority does remain to invest in the business.

And we want to do that in a way that creates good risk adjusted returns for shareholders. And so we tend to do that both organically, I would say, through CapEx. And so Steve touched on a couple of the more significant investments we’re making right now in both coffee and some of it in our baked snacking capabilities. But we also look for opportunities to inorganically add depth within our categories by doing bolt on type acquisitions. And we’ve done that within seasoned pretzels in the last year or two.

We’ve done that within the Harris Te acquisition, which I’ll touch on in a second. And so this is the idea of how can we be the best partner in a given category, you know, in which we operate. And so what we’ve done more recently is build that capability within our existing categories so that you are the go to partner and you have all the capability within that category. We found that that’s the most important element from us from a strategic standpoint in our relationship with the customers. As we do that, though, we will maintain our balance sheet, so it’s not done with the intent to lever up the company.

You know, in the near term, I think you will see us build cash after the Harris T acquisition that we did earlier this year, and then reevaluate, you know, what would be the right use of any capital that we then build over that timeframe, whether it be investing in the business. And then, you know, we did pay down debt over this three year timeframe, And then we also look at opportunistically repurchasing shares as we have the capital to do so, and there are not other higher returning opportunities in front of us. And so I think over a three year period, we’ve really done that description of first investing in the business, reducing debt, and then thinking about how do you return capital to shareholders over that timeframe. So relatively balanced in our opinion from a capital allocation approach standpoint. And then maybe just a deep dive into tea and why invest here.

So we did have a tea business. I would say it was largely a branded co pack business. And so this is a good example of, you know, historically had somewhat limited capability, and so you were relatively less scaled in that category from a customer standpoint. When we looked at Harris Tea, this was a nice opportunity where they were the leading private label manufacturer in North America. And so they bring really great depth of capability.

And so, you know, we have the capability to pack, but the sourcing, blending, multi format packing, and then having access to the largest customers in distribution already was a really attractive opportunity for us to go scale our tea business. And so we see really nice opportunity for us to continue to grow that business. This has been a category that’s actually been relatively fast growing over the last three or four years and taking nice share within the market. And so this adds a depth of capability with the assets that we’ve acquired for us to go continue to do that. You know, the buyer at our customers for tea and coffee are generally the same, so this makes you important vendor in that space for an important beverage category.

And so this was a nice opportunity for us to do just a good example of the type of bolt on acquisition that we’re talking about that adds the depth within our existing categories. As you think about 2025 and how we got into the year, you know, we’re expecting adjusted net sales in the range of 3,340,000,000.00 to $3,400,000,000 which is down 1,000,000,000 to up $1 or flat at the midpoint. There’s a couple of moving pieces in here. I’d say at the highest level, volume mix will be down about 1% on the year. That reflects a few different things.

And then it will be offset by pricing, largely commodity related with a little bit of strategic type pricing as well. But really within that adjusted net sales bridge, I would think about that as the Harris Te. Benefit being a bit offset by a few things at the midpoint. So there is some business that we’ve chosen to exit through some of the margin management activities that I talked about earlier. So this is getting out either the lower profit or more complex volume that we’ve been running in our system in order to operate more effectively.

It would be the exit of that ready to drink business that I referenced earlier and the impact of a griddle facility where we had some supply chain disruption, and that’s been restarting. That’s on a nice path, but there was disruption early on in the year, which we are overcoming at this point. And then from an EBITDA standpoint, we’re expecting EBITDA in a range of $345,000,000 to $375,000,000 Nice improvement on a year over year basis, and that’s really driven by the supply chain savings that we showed earlier, the margin management activities that we talked about, and as well as the cost of work that we started to execute on in Q2. So we see a good opportunity for us to continue to drive profit in this year and into next year, regardless of what the consumer does. And so we think this is an opportunity for us to control what we can control within our grasp and continue to operate.

And with that, I’ll wrap up where Steve started, which is, you know, private brand snacking and beverage has been a really nice consistently growing intersection. And I think you’ve got good secular tailwinds of private label adoption both by the consumer as well as by the retailer. You know, we are investing to take our best advantage of that opportunity of where we’re seeing private label growth, and we think that’s by being deep in the categories in which we operate. And so we continue to invest in order to drive that depth and capture that private label growth opportunity. We think the pivot in the near term to drive margin and cash flow, there’s nice proof points early on in the year, and we’ll continue to perform at that stage into the second and into the back half of the year.

And we see a really good opportunity to go do that, and there’s a lot that’s within our control that we don’t need to rely on the environment to go execute. And so, you know, we’re really confident in our ability to go drive margin and cash flow as we exit the year. I think that’s the extent of our prepared remarks, so thank you.

Steve Oakland, Chief Executive Officer, Treehouse Foods: Yeah. John, we have two minutes and seventeen seconds. Why don’t we do Sure. Let me let me talk about it. So what we did, the guidance we gave with all of the disruption going on in food and what we saw as a decelerating environment as all the pricing went through and all of that stuff.

We guided a flat midpoint. Okay? So we cut some businesses out early in the year. We have some businesses recovering in the back half of the year. So we don’t have to have in order to meet or beat our back half guidance, we don’t have to have the categories come back, we don’t have to have the consumer have a resilient, you know, back half.

We’ve got to execute our waffle plants and execute our broth plants, and then serve the demand that we know we have. So that we felt like we would we would guide what we control, and we feel like we have that comfortably in place. Right? So that’s why we reaffirmed last time, you know, we were together. So so that that I think is good.

You know, it’s a fascinating time. Where has the volume gone? If you look at, you know, you see QSR down, you see grocery down. I think the I think it’s really simple. I think the consumer groceries went up 35% or so in a twenty four month period.

I think there’s a lot of uncertainty in today’s world. I think although the consumer continues to be reasonably resilient, I think they buy one or two less units a trip. I think it’s that simple. And you hear different on on the big branded guys show different numbers on snacking versus this. The good news is we’re performing relative to brand incredibly well.

Okay? But the the absolute environment is soft. So I think we can comfortably be flat, we can comfortably make the numbers we gave you with the with the restoration of the businesses we talked about. And then we’ll the work we’re doing internally is gonna make us a lower cost operation and you put any volume on that, it’ll it’ll lever really nicely going forward. So I don’t think the Americans stop eating.

I don’t think anybody’s thinking that’s gonna happen. Okay? I do think they’ll buy a few less units in the near term.

Pat O’Donnell, Chief Financial Officer, Treehouse Foods: I guess a follow-up on that. So it feels like this year margin management activity, is that a multiyear thing or is that kind of an accelerated in 2025 that puts you then entering 2026 with a solid core base of business?

Steve Oakland, Chief Executive Officer, Treehouse Foods: I think it’s very close to that, yes. I mean, I think it’s good hygiene regardless. I think when things were growing like crazy, you carry that extra half a shift. You know, the categories we’ve got categories that were growing 5% units, right? So you carry labor, you carry a lot of cost structure that you wouldn’t carry.

And so picking up that little complex piece of business, you’ve got room for it. Right? When you really analyze it in a flatter environment, it doesn’t make sense to do it. So so I think it’s good hygiene regardless, but I think, yeah, we look at this as a ’25, and we got at it at the end of twenty four, quite frankly. That’s why you saw some of it in the in the first half, because there’s there’s financial benefit.

So we wanted as much of that in ’25 as we could get, so we went aggressively at it early. So I think it’s something you’ll see happen more early than late. Thank you, guys. Thank you. Yep.

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