LNDC - Earnings call transcript Q3 2019 | Lifecore Biomedical, Inc.

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Operator

Good day, ladies and gentlemen, and welcome to Landec Third Quarter Fiscal 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions].

As a reminder, this conference is being recorded. to President host and like Molly today's now Landec’s Hemmeter, CEO. would introduce for your conference, I Please go ahead.

Molly Hemmeter

XXXX me Thank you, Greg third year Landec's you Skinner, for call. Amanda. Good Officer. morning quarter and Landec's Chief of today the call on thank Financial joining earnings is With fiscal

Exchange forward-looking the we outlined including differ certain materially. XXXX. Commission, risks that are risks Securities actual and XX-K During today's year statements cause to call, uncertainties our results with filings in and may make Form fiscal company's involve that could the These for

As meal that brands ingredients. Oils flagship Landec natural our vegetable CDMO include our and and our a salads Eat brands Cabo leading plant-based offer Fresh innovator business, Vinegars, our in businesses; or emerging packaged diversified & XXX% avocado Foods, brands health O acquired Curation foods Now and and products with products business is wellness of guacamole contract products. Smart that solutions, include and manufacturing These food pure-plant which our natural comprised development now recently solutions, clean four Yucatan and Lifecore, Olive and five and fresh two brand, includes Planting

due volatility; a X% or in operations XXXX, costs; liability investment. $X.X guidance offset no end increased quarter vegetable top a was in resulting in of to and drivers third from non-salad revenues of $X.XX Windset partially at The of by; weather our the was in to associated one, fair acquisition two, the For business costs earnout in our the with our benefit due the million our market XXX.X which the earnings end with our quarter. of increase logistics the shipping the value of incremental consolidated and three, consistent shortage of O for the fiscal to million, guidance revenue increased low $X.XX our reduction per share

food the preclinical work clinical to line preparation line made half is first Apio begin drive Lifecore Yucatan Foods, to quarter, significant Lifecore ranging has from Lifecore drug a and phase to and significant CDMO this of business of business was strategic multi-purpose strategic during completion of expanding filling that Also product the progress on over production the fiscal studies. phase from the products the Curation signifying of has long-term commercial installation new early third the of pipeline. quarter, pivotal changed in objectives Landec’s late name its development this transformation and of in XXX% beginning ingredients its of value. completed for also under our of building unifying to at brands, syringe a mission-based third the of the clean in added acquisition we expected corporate quarter. brands, During XX vials Yucatan of five shareholder and identity. at and now all plant-based with the third Two new result development Cabo XXXX. device one strides medical as Fresh, stages various were FDA-regulated made the of vial these Foods during

fiscal sales and Foods and Mexico. flagship our XX% Foods manufacturing low-cost and a include strategic and high foods in in gained the generate are department year O, with XXXX portion business. Yucatan largest brand projected added the Fresh Curation Cabo natural in to Planting, acquisition, revenues deli of Curation and four guacamole of Yucatan, the stores, Smart natural the retail representing Eat Foods category, now brands With the entered The footprint of to Now relationships food XX% new capabilities growth customer emerging

more business, sourcing of expected XX% to margins emerging at in vegetable to packaged the gross cost compared generate four is time, XX% of the and As subject XX% volatility. to fresh they scale least are to margins over brands gross which

program forward, on operational Foods and on the aggressive new Moving while integration Foods efficiencies, cost-out focused products FDA-regulated while market is an of Yucatan is drive Lifecore product and to innovation share. focused commercializing Curation advancing

detail the let our me go next some of key of about XX into call Greg focus months, financial from to over our areas XX Before turn to XXXX. over more fiscal third highlights quarter I for the

Gregory Skinner

of from Lifecore revenues a per you, for new from in from quarter. the fiscal to was revenue. income compared the the and XX.X morning, primarily last X% and addition of the a into of one-time $XX X% net Foods a increase net The good to Curation decrease to was year-ago first, went result share or Thank XXX,XXX million per income corporate in or rate of at quarter increase operations million Net in income in XX.X Yucatan increased from effect during XXX.X quarter. the quarter of was the per $X.XX Molly, million or million year-ago X% million $X.XX continuing quarter million X.X increase Foods The the everyone. benefit a in the during quarter year. third tax share share $X.XX income Revenues XXX.X due that XXXX in to third or compared or tax

Second, a expenses. acquisition-related $X.X million of

$XXX,XXX of or Curation increase a in a million revenues. increase Yucatan in $X.X Third, months XXX.X $X.X soups year. reduction this from million from and the after net in interest last and and liability nine million year XXX.X X% for million in O earnout partially year. income or from the was third last revenues months due increase X% expense. acquisition. from Net X% in in Revenues XXXX during in fourth, or XXX,XXX income XX.X at increase million primarily increased primarily the the due the benefit Lifecore $X.X to was of Foods quarter the from continuing nine of X.X including per decrease Foods period new tax tax effect million increase fiscal period or XX.X a offset to decreases operating million the to and income increase a same first benefit in in Now from $X.X The operations a These the a to Foods Yucatan in the million one-time decrease first taxes, $X.XX income the profit last tax the expenses, And income fiscal $X.XX from was The per of at the million a were $X.XX addition first, same XX.X reform share net in year. compared share recorded that Planting per tax into result year. last the benefit addition of corporate of Foods, million Curation excluding a the from or went by gross during net rate quarter share

million expenses. Second, acquisition-related of $X.X

Yucatan including fair net the Yucatan Third, $X.X from million primarily liability fifth, the in million the of decrease increase tax And at the Foods in in in profit from addition excluding offset in expenses, Now expense. a the first investment of million year. compared this year in months the fiscal a increase the acquisition. value decreases from nine in Planting to income gross first from a months operating impact company’s were the the primarily Fourth, earnout reduction and reform fiscal $X.X income Foods $X.X the increase $X.X O due net $X.X expenses, These Curation XXXX during and Windset benefit a nine Foods, interest $X.X after of addition $XXX,XXX by fiscal in a and increase partially to increase million market the last from of of tax million million XXXX. a soups in the

The to be rains XX million the XXX million fourth of At revenues Foods, income our February of California early XXX fourth are to expect quarter operating Lifecore The fourth range costs our temperatures million due income in and impacted Curation throughout Foods million cold of million in our net yields net the quarter sourcing of XXX per expect Southern revenues to reflects income vegetables $X.XX quarter for is to million very fiscal X.X non-salad which in the both and and related March California, heavy record million. X.X business expected share. to the fourth in to impact income For be in negatively fiscal in to operating month negatively revenues guidance X.X XXX projected be during XX to during of first, XXXX, significant X.X of quarter. $X.XX we million we and to to of business of to from million. Curation million the and operating income February

quarter. Second, market investment shortages. the higher than driver And during our due Windset to third, expected costs in logistics the value change no of fair

sequentially we In to than expense capitalizing interest less expect increase primarily due previously addition, forecasted. interest to

the to expenditures forecasting fiscal We quarter from to of million. for XX flows fourth of million million are operations cash consolidated XXXX XX of million capital and XX XX currently

had of we financial our into debt of the to end a X.XX of at approximately which million ratio the X.XX. quarter position, translates debt debt tangible to to XXX third asset ratio equity of and Turning

the at ratio X.X. the quarter approximately leverage Our of end was third

covenant less, means in We of quarter projected typically of fiscal X.X capacity however, generate capital approximately Our $XX due expenditures borrowing to cash is the million. we fourth or operations the the expect had previous our the and to of leverage year end from during most which year, increase the be within and but XXXX leverage our in increase fiscal our fourth ratio covenant fiscal quarter beyond. debt fiscal by at still XXXX, end to year well three we compared quarters

back Let me over turn Molly. call to the

Molly Hemmeter

Greg. Thanks,

cost implement to initiatives the next savings our over business. Curation priorities first, to in are; two top Our Foods one years

business. growth third, the continue Lifecore or to premium invest our hyaluronic Curation to profitability in Yucatan accelerating a of HA. integrate acid innovation as Lifecore, Lifecore and Foods. historical supplier Foods at by team capabilities and and At operations into invest expanding beyond Curation in we the And Second, to business both in Foods growth

to to of expansion designed capabilities existing HA in a increase the our with million partners people HA XXX% into planet and for as by and unique XX%. transition a to fermentation, with combination strategy generations. in refrigerated products. business commercial CDMO invested to for throughout is aseptic currently in line capacity filling process and drive align has to achieved in while Lifecore’s Lifecore’s continue and addition increase capacity demand the of future needs driven commercial its to to enable million of that with are preparation million as vials, the equipment store. provides a line expected force future invest We in its foods clean multi-purpose multi-purpose and Landec products to the reimagining to Most overall XXXX by access protecting sales chain growth future its many receive further of approved capabilities The formulation, final in supply and expectations HA is mission in possible a to proven development full to in fill Lifecore product its once preserving is infrastructure we have to it quantities of capacity services development of product installation prepared specifically to provides market $XX investing fresh perimeter the products new potential in $XX complete Curation differentiated and and capabilities by this This pharmaceutical line. filling $XX direct the meet truly recently, fiscal Lifecore’s of initiated will Curation is annually products to in Foods drug growing new strategically have refrigerated a revenues a enhance which ingredients difficult-to-handle, a this to new capabilities, customers by and new to capacity Lifecore’s plant-based as to as for currently with The CDMO, delivered. transition FDA FDA expand We has how development. accomplished with the Lifecore filling markets. fill internal grown, also product. fresh fully We fermentation incremental capacity packaging new that Foods capacity of partner invested be syringes. expansion innovation to of in and also approval has integrated achieved. makes market Lifecore plan differentiated requirements demand The

entered with long-term positioned sustainable rapidly innovative have to the high-growth food several several products deliver last Over well we line growth. and are categories into years, top and

and With the of critical our stage next growth. the Curation we complete, strategic product stage Foods portfolio turn of transformation to the

ever-increasing systems well will this through as business efficiencies operational critical driving are phase, by to chain automation, next offset as weather our costs These costs supply delivering During costs in and industry. Curation reducing being increasing we efficiencies to on excellence service are freight experienced the synergies. due and Foods to by packaging and labor, integration entire that focus volatility

that experience considerable identified The in savings the and the Foods beyond identify the in Group, already Curation engaged firm cost been consulting our have by third-party operations we such, cost As a Hackett team. produce with food have industry, reductions above to

our the to currently store retail weather will increases evolve as fiscal objective are distribution in attract the costs Foods improving Foods' cost department of in forecasting plant-forward mitigate business. savings reducing between sales leverage real volatility, Foods Foods the known all business, Yucatan integrating time, stores, throughout Foods cost Foods. We Curation Over produce immediate and consumer. in team cost team fresh synergies food earnings continues the leverage of sales with organizations. food the and with retail perimeter primary We the of will the experience the that the of we Yucatan Simultaneously Curation focused predictability estate sales XXXX two newly the into combined are the offset organization of stores. exist believe club in associated to to of Curation of this with our products on stores able be Yucatan will while Foods expand within the Curation experience department will deli

to Foods, term, future to to service proven be while quality opportunities may brands. and drive the will the the and the also Smart and to savings capabilities to in Along Foods’ and term, levels. to that Yucatan potential At of partnership strategic lower foods growth. also products Curation equal to sourcing plant-based product innovation Curation growth higher addition secure with with In Foods' numerous and to exist Yucatan cost, continue other delivering product relationships Foods leverage reach new the lower-cost Curation And portfolio launching innovations and fleet in markets among success we Curation customers at clean or manufacturing products. medium cost for Mexico Foods leverage footprint its invest for increased ingredients Longer Foods we with able synergistic XXX% evaluate of to of sales distribution, leverage In Yucatan Eat creating to logistics there Foods, with refrigerated integration opportunities we and are continue on-trend initiatives customers. in disrupting drive our of invest profitability.

Foods’ and select efforts the supply acquisitions our bolstered products and Olive Foods. Yucatan benefit growth future of high innovation will have profitability Foods’ Curation innovation, can capabilities. these We Each O to internal with and from contribute quality Vinegar chain plant-based of acquisitions that and & contribute Curation selling

continued revenue and Looking be income to operating increase and expansion and in will be continue XXXX, at to to driven compared in both Lifecore Foods category. The to sales of CDMO fiscal the expect Lifecore revenues driven of Foods and full Curation at avocado product a we Curation guacamole growth year by primarily development fiscal pipeline. XXXX. growth product the by HA revenue will The growth

With margin and fiscal gross are the higher in revenue coming margin from expecting overall growth XXXX operating our to also increase. products, income we

release in are release. XXXX guidance for Lifecore and share summary, year-end Curation growing that businesses. committed results both XXXX two late Foods our fiscal In provide growth with projections will in we July our our We to fiscal and

profitable business continued scale. Over years, segments. revenues we At successfully grown the innovate to a have Foods, XXX% to clean products Lifecore have CDMO plant-based we of in Curation growth high create

exhibits that With product a platform, infrastructure the Foods driving our cost future, and our Foods, business. advance of which predictable higher margin in a a and all in Mexico less offering has Yucatan lower to Curation in food more contribute growth acquisition profitability double-digit progress of volatility,

now are open for questions. We

Operator

[Operator Instructions].

of line is of Our first Petusky the from question Barrington. Mike

line Your open. is

Mike Petusky

A morning. questions. Good couple of Hi.

the some below you’re something and the teeing feel I was guys that and XX of know I looking like months growth XX% new salad single towards months, over and as of innovation X% to up consumers targeting And me Molly, introduction the respond sort are figure XX% positively digit X, X%, you just as growth looks will you to upper you’re in of guys nine category? will a more products. closer in next through forward, and you’ve that drive to So, like wondering numbers, on you do there, you you guys are towards there terms it things XX, salad the discussed look

Molly Hemmeter

for questions. Hi, your Mike. Thanks

year we in salad sales, but past club our in calls, to specifically right projecting X% private said a mass as So think fiscal growth about now, lot is both due are of channel. the 'XX, a in in we’ve I rotations and that in headwinds labels,

salads to going fourth our projections our not do but we’re – give forward, to we for innovation are we looking year, we’re see do in be growth and As quite growth quarter. we launching next see ready

as think market fourth the at and going give salads we to July start of how our for kind able in accurate more the be in that projections And received we’re so to better to call. launch quarter, is see that I projections innovation in and that our

Mike Petusky

Are sort those is be to it release in fairly innovation introductions? going of going to be limited of or widespread sort a

Molly Hemmeter

to typically products try few recipe success. our strategic a to right learn the customers before test got first and sure release we’ve that we scale make for and we them to Well,

so, that I test moving that more and a can strategic how so it them, we see And few in forward goes. learn, see customers

Mike Petusky

you. Got

– related feel you so Publix Planting? talk there you’re in or terms now just that or quantification, have two you months help getting there like a a and Now can forward maybe necessarily but And do Yet going traction for guys is Now learned several in of things sort will one about of you or I’m you anything you of retailers. other Planting not had any have traction looking on subject,

Molly Hemmeter

Yes.

we’re because I variety and very a So, give our we’ve learning overview wide really results, that. of deal testing good customers and can strategic with that been an it we’ve happy our seen of Planting actually quite we’re with Now a

now say three about would we’re – I we’re So, different in in customers.

in are well, in we – different three We were customers.

launched into So test up we store And those in we’re in area called is into why learn. Loblaws which stores like into we Publix, and a we Minneapolis Canada, seeing we also different to from natural launched results launched three Byerlys. three and & Lunds

degrees over market a it of as So in A a were they as plant-based low has that being Publix and we not XX in high what very are XXX that and of indexing do percentage longer found to was we actually no Florida that consumer selling are Publix, they And the lot in our area. we do have pursuit. there. is when far carried in

So that’s in right In Publix well we Canada. Loblaws, have determined for us. in the that very not it’s market going

Now we actually consumers calls we in Canada Eat and know indexes about very in Canadian past our are market our and share we’ve plant-based well brands. how the talked with with for leader Smart the salads market

And actually we is in well. called very And the chain Loblaws so doing small that we’re see also & in it it’s channel, well. Lunds very Byerlys, performing a then natural

So move awareness we marketing consumer we’re I programs think we kind of believe the of to customer is learning to the and on to we grow we’re and working plant-based with product. what really where those we’re and finding specific the as is want consumers expand brand

Mike Petusky

And of of Okay, this a is sort are quick guidance, as is flow at flows, over but out positive you’d a as Greg, quarter sort official consistent targeting we where there say, sort of but year fiscal great. you where I look Greg. get hey, at a sort giving look basis? there appreciate quarters, look is QX next the several as guidance in and you we or of for the not on you cash where terms I just you’re and one know one of cash

Gregory Skinner

ratio year. And quarters as cyclicality of think Lifecore our least given result we some the the quarter finished budget, leverage And fourth Yes. of of years be a and into usually that of year. are be haven’t at our will first some the tend of without this the the even our lower specifics half peak at I getting specifically to seasonality

we’d I year. we’re out, But specifics when of more give half looking call. July the the So think second in next

Mike Petusky

Thank great. Okay, it. appreciate you. I

Molly Hemmeter

Thanks, Mike.

Operator

you. Thank

Anthony of of question is Group. Vendetti the line Maxim from next Our

open. Your line is

Anthony Vendetti

Thanks. Good morning.

Molly Hemmeter

Good morning, Anthony.

Anthony Vendetti

Good morning, Molly.

little a Just wanted more to Lifecore first. about talk

increased So capacity. I the know you’ve

what the and online? to some that now of capacity that remind was Just of me, that do the new is cost what’s timing the business

Molly Hemmeter

line – Lifecore filling Greg. ahead, go The

Gregory Skinner

ahead, Molly. Go

Okay.

testing looking So initial the million, the be we’re like right in of line about cost will now XX of first fiscal now the – and right XXXX. it’s Anthony, the use the least at half was where in

Anthony Vendetti

And for correct? there’s that, business up lined already

Gregory Skinner

Yes.

Anthony Vendetti

general Okay. contracts? capacity, And of of quarter. pushed in there this in just but fiscal is some fourth upcoming that Any that would revenue some for it ex reason quarter or the timing into that just were Lifecore

Gregory Skinner

seeing been third putting this to you the and be revenues if of it’s process seeing year change more 'XX. that We the And of profits Obviously, seems the year their and in new evenly our look we’re back share fourth going we’re more the It could Lifecore forward. could new the trend norm. and quarter. started third lion historically it a for be at last were quarter. that of But still again spread that over in be plan together it

Anthony Vendetti

Okay.

Gregory Skinner

internal They’re and for We line of fourth revenues had this the some year. going with knew the to the our the were in historically quarter happen that quarter third expectations in in year. hit that expectations

Anthony Vendetti

was QX. what’s the Is then that for the like non-salad correct? if look in revenue, that? down that Okay. it looks X% reason we if around so, And at And

Molly Hemmeter

down The supply the mostly core of issues we’ve been is revenue having. because

an it hit thing. industry as with So quarter bean in first to us not wide green was and especially the – we again able were

were some And and all so short we the we able unfortunately. meet to did not demand customers

business call, cauliflower green have of our has going haven’t short and on out and in in or and and years front really really That five have see we We’ve on said, availability and had do ability we But that to in have yet customers. now with QX looks continues heavy salad QX the our in business very this hurt the and shortages it business bean in now reiterate service six strong. to we part been rains that and to broccoli been the we maybe in to spoke in salad. of over about just have want being six any in back five to I core. customers or years those any that volatility our not salad We’re

we’re products [ph] see in are quarterback we robust business. in to vegetables the more using those our So not volatility and much susceptible the

Anthony Vendetti

right, All thanks. great. Okay,

Molly Hemmeter

welcome. You’re

Operator

Thank you.

is Our from Krueger of Capital next the line question Lake Chris of Street Markets.

Your line is open.

Chris Krueger

morning, guys. Good

Gregory Skinner

Chris. Hi,

Molly Hemmeter

Hi, Chris.

Chris Krueger

Hi.

You that sourcing that bean significant bad and I the you in done month Has think in the regions? into recent guys are indicated issues had better March. green weather from February California in weeks? And how also growing

Molly Hemmeter

right. All

the regions well bean growing are doing So right now. green

don’t in the So issues we’re away. to We’ve and broccoli back as see rains that We inability said do to in fourth seen we our and been fields into some due cauliflower earlier on get green in the the – some have we any beans. out there. were quarter previously the and shortages I see and right

release. we So we the in press in included do projections shortages are those see the some gave shortages which

Chris Krueger

and a or in as the All border has right, businesses it avocado you been talk we be the risk How could days really shutdown. far as it. the look acquired? should two that at There recent got not about whether Mexican and guacamole, potentially

Molly Hemmeter

Right.

large is situation avocados in Haas So is supply obviously there couple of and also Haas pretty a of spiked avocados. news. on days the prices have last being That an with said, this the evolving

border any done So same. is but avocados, no people are of of closure. and the stocking anticipation We’ve in there buying shortage up avocados

are on also avocados. up We stocking

those so as are are that as avocados. we making is have sure we own actually soon rooms, we goods which facility, and the we into ripening our our our those finished And create guacamole States. We United Mexico at have ripening transport own finished

in our happening at cushion will does event anticipation temporary our in a building are we in us least and happen. that United that anything at give So States warehouses of inventories the something the

it to So everything that the that in me predict is we’re to going doing does. for happen, can but we if event hard

Chris Krueger

Got it.

per new then but past of And the roughly kits, about product really that don’t I still the having Okay. talked you’ve kind haven’t one in quarter. checked – Is the on salad pattern? lately

Molly Hemmeter

is. And the launching new we in It innovation quarter. will be fourth

talking about to out I’ll we’ll forward call. the our follows next about look probably products new talking LinkedIn. I LinkedIn putting in be And news on everybody be it some earnings about So if it.

Chris Krueger

Thank right. you. All

Molly Hemmeter

you. Thank

Operator

Thank you. [Operator Instructions].

is of from the Morales Walthausen. next Mike of Our question line

Your open. line is

Michael Morales

Hi. Good morning, my guys, taking questions. and thanks for

Molly Hemmeter

morning. Good

Gregory Skinner

Good morning, Mike.

Michael Morales

a HA of capacity like into things the is One the and I’d bit expansion more little the to there. dig Lifecore

you So in guess give a just figure is growth on what at typical outset, HA the I us could the year? the market per

Gregory Skinner

look I’m you sure aging is stats HA in some share current of at the If these and ophthalmic cataract space not the how and just in demographics primarily – the from Lifecore’s but lion’s are, surgery.

the get you So least a in range at was of per the and it focus X% surgeries I cataract was growth are kind of growing on the statistics year. what last saw

anything additive our much the base as then that growth. with would So that in HA growth increase growth of you can pretty and bank on that just level

Michael Morales

Sure.

that so the in filling lion’s of a of expansion, like that new operations correct? growth share part line HA the is XX% it the X% going to So HA support of Is market, sounds large line?

Gregory Skinner

is line toward use lot purpose followed the the new and question, that’s new main I’m not quite the market. drug is vials directed A line primarily the but the sure for for your yes. of I pharmaceutical of and

Michael Morales

Sure.

fill another way could HA support correct? saying wouldn’t natural new be expansion filling So the of with the maybe to Is it, HA the typical in growth that going just XX% growth line. capacity and market to X% HA be in a used market, only the on

Gregory Skinner

products. and customers new and Yes, new

Michael Morales

Sure.

And -- so

Gregory Skinner

driver primary share market the is in Growth there.

Michael Morales

that long? forecast your rolling getting out customer you’re And how Okay. from go

Gregory Skinner

XX months.

Michael Morales

okay. months, XX

on how the So to at historically least basis Lifecore line it filling has new us this above comparing the doing? is economics Is that’s on Lifecore existing help per understand unit work of done? then, can you what that a

Gregory Skinner

Since yet, may have ask and answer we you. question July haven’t I in up an that me for started

Michael Morales

Okay.

Molly Hemmeter

we we the to out pipeline, to and all model continue XX% margins. years general new in product gross the Lifecore even That deliver Lifecore businesses as in with XX% being look to said, three development we expect

product to our space that product an gross high. obvious The there’s continues margins the and mix fermentation there XX% in high development has to XX% So HA margin. which deliver mix are very is

Michael Morales

for helpful. looking me Hackett progress? And and The that continue lastly engagement make they’re Okay, areas would you to an give as of to specific that’s be that on us maybe update Can at then more Group. business as opportunities takeoff far

Molly Hemmeter

Sure.

very we’re program the business. and this cost-out So top consider about food we priority our optimistic in the

the seen are all we acknowledge and cost doing food the we’ve to these of business need increasing in As ever costs. business

year so our a weather volatility cushion going our foremost, and is that deliver build are and we and can more goal cost First earnings. more to increases contingency against business year-over-year every our predictable up in

So I think is. of that’s initial cost-out our goal program what

a find to make cost-out As unit tremendous was is didn’t far reason we when opportunity. automate lot – operations. have have is dig as don’t it’s at of the of enough sense not a labor the lot or sense process ROI that make we you a of was cheap didn’t it past the the opportunities. just to the a and it In there. And this was the cost-out that that amount business not when positive one XXX-year extremely things have I of where to look and business It’s to examples, dig

make to just of sense. With the really automation starts costs, make increasing labor lot a it

operations and in doing plant in plant that Bowling are our that automate did year. not will our And so we then a unit Guadalupe next be the automating lot in of Green, we previously and we

our we about out gain cost Yucatan I’m – optimistic can are We also very acquisition. the some by of seeing that

already internal those route and of the let an is different about the shipping in Texas. into our so instead we in example. outbound, the – nine We grow using. the that own finding bringing that do products We’re have we me products trucks warehouses, are we we from up are own during for our that finding the grow up Mexico really out going about as that that give use Yucatan routes. broccoli of months for customers Mexico is same currently And guacamole into the logistics you our year United and currently on States you we’re through trucks internal think if That current our can logistics

truck synergy. same guacamole and those our it as able we’re the out to logistics So Texas leverage going and excited that be very broccoli the put we’re to bring on through

is examples, the those one just food for business. of in a to big them, going are think So but be I a few us automation

Michael Morales

Greg. Thanks, right. All you very much, Molly. Thank

Operator

Thank to Hemmeter. And over this the like turn call back to I at time, Ms. you. would

Molly Hemmeter

everyone you. for our call today. Well, thank you Thank joining

strategic Lifecore be year. truly to to about growth deliver have Lifecore line. continuing optimistic to XX% and Foods food for I their this portfolio work business. to we hit continue and our We we’re XX% In projected we Curation our develop through and transformation. our our very continues growth. that They’re to believe that projected

this and into simultaneously turns the in are so our brands out Fresh our in cost are focus fiscal we’ll that and segments And be deliver Cabo now share. beyond very year on for We rest think top to in now market doing poised growing predictable cost out getting order are our of be of trend systems. feels and to I on the 'XX and and with we’re business to strong product growth in very line the food with going and market Yucatan focused earnings consumers, integration more

and you thank supporting today for us joining keep Landec. So

Operator

Ladies This program. and gentlemen, in today’s participation thank conference. the you conclude your for does

You Have day. may a great now disconnect.

Lifecore Biomedical (LFCR) 4 Apr 192019 Q3 Earnings call transcript