General Mills, Inc. ($GIS)

Okay. Good morning, everybody. Welcome to day 3 of the Deutsche Bank Global Consumer Conference. To kick things off this morning, I'm thrilled to welcome back General Mills to our conference. And with us today, welcoming back both Dana McNabb, newly assuming her role as Chief Operating Officer; and Kofi Bruce, who you all know as Chief Financial Officer. Which is not to diminish your role as...

Keep moving.

So we're going to use the entirety of our time for Q&A. And I guess just to start off, maybe if you want to each offer sort of just the key messages, key overarching messages and then we can dive into details.

Sure. You want me to go. I would say our ultimate goal is to get back to delivering long-term shareholder value. And the way that we're going to do that is 3 ways. First, we're going to restore profitable organic growth. We are going to continue to manage our cost efficiency, and we are going to continue to be disciplined in how we're managing capital. So why don't I take growth and then you can follow up with the other 2. As you think about returning to organic sales growth, we've been focused on improving the remarkability of our brands. That's about making sure that we're delivering what the consumer values across our proposition. And we have been very invested in making sure that we improve. Our first investment was against price, and we're seeing that work. As we close this fiscal year, we are improving our base volume. We are improving our competitiveness, and we are back to household penetration for the first time in 3 years. So now as we turn to this next fiscal year, it is really about building on that foundation. We know we still have work to do. It's going to be a tough consumer environment. But having that stronger foundation and then being able to continue to invest in remarkability is what we're going to do. And the focus will be on product, it will be on packaging and it will be on communications. So let's talk product. We are going to have meaningful innovation and renovation on all 8 of our $1 billion brands. That's about delivering against the benefits the consumer value. So think functional nutrition, think clean label, bold flavors, the humanization of pets is still a trend. So we'll have meaningful news there. In this fiscal year, we increased new products by 25%. They're working. That gives us a really good foundation, and we'll have a step change on that again this year. So think things like we're going to bring protein, which works to our biggest brand, Honey Nut Cheerios. We are going to scale businesses like Annie's and EPIC and Tiki Cat that have a real right to win right now. We are going to launch new brands into growing categories. So think GHOST performance nutrition bars, La Tiara in the Mexican segment. We're going to bring Wanchai Ferry to dumplings. So I think product innovation that the consumer values and is willing to pay for, that's going to work. Then we have packaging innovation, 40% more price pack architecture on meaningful benefits, new sizes, new formats, new functionalities. And then communications is incredibly important right now. We invested in digital tools, and we also brought influencers in. We really changed how we approach marketing, and our comps are returning double digits. So we'll make another step change in that again this year. So really building out the foundation that we've developed and leaning into the things that we know the consumer values, that's how we'll get back to grow.

Yes. And so you just heard Dana talk about the pivot we're making off of fiscal '26, where a lot of our investment focus was on ensuring that we had the right price value equation for consumers. And now that's freeing up capacity for the rest of the remarkability framework and levers to work. And that's what you're hearing in terms of what's going to drive the structure of our growth for fiscal '27. But in addition to that, as you step back, we are very focused as well as we move through this cycle on ensuring we create the flexibility in the business model to fund and support the business and the growth agenda of the business. First, I would point to our continued and ongoing ability to drive industry-leading cost of goods productivity through our holistic margin management program, which over a 20-year period has averaged about 4%. The last 3 years, 5%, aided by investments we've made in our data stack and our digital tools. And we would expect that to contribute roughly in the same range again in fiscal '27. We'll give a little bit more specific guidance here in a couple of weeks as we set and release our earnings for fiscal '26. But on top of that, we are in the middle of a multiyear transformation initiative, which we started in fiscal '26, where we delivered $100 million of additional savings on top of that holistic margin management. We would expect at least that level in fiscal '27, and there will be more as we move into fiscal '28 and beyond. So I think those things are going to be critical both to helping us move through the cycle, fund the growth investments that we need to get the top line moving again. And then over the long term, will help us drive the leverage in the P&L we need to help restore earnings and cash flow and all of which will be incremental support for driving down leverage, creating strategic flexibility in the balance sheet. And then to that point, we continue to drive really strong free cash flow conversion off of our earnings even in an environment where we've seen a lot of disruption and challenge. Almost [ $100 ] on every dollar of after-tax earnings, we're able to convert to free cash flow. That free cash flow feeds our 4 core capital allocation priorities. First of which is to make sure that we're investing in the base business for growth and cost savings and capital spending. Second, to support our dividend at its present rate and over the long term, generally to grow that in line with our after-tax earnings. And then third and fourth priorities sit between M&A and share repurchase. And then obviously, in this environment with our debt leverage elevated, we would expect to put a little bit more focus on bringing down leverage with that incremental cash flow after the dividend.

Okay. Perfect. Very good framing. So before we get into some of the details underneath those elements, I guess, Dana, just as you move into day 4?

Day 4.

Day 4. So I guess, how do you see your role evolving to support all of what we just talked about?

Yes. Well, I think -- first, it's a privilege to take on this role and to be able to lead operations for our company and to really take the remarkability framework across the enterprise. I would say my #1 priority hasn't really changed. It is to restore profitable top line growth for the enterprise. And so I know we'll talk about that throughout this conversation. But I would say the other area I'm focused on and will lead are the transformation efforts that Kofi talked about. And transformation really just at the end of the day is about making us a simpler, a faster and a more effective company. What we're trying to do is really reimagine how we work so that we can get faster, we can improve our cost structure, we can get to decision speed in a better way. And so if we take that and you combine it with what we're really good at, which is HMM is the cost efficiency Kofi talked about and our strategic revenue management, I think that will create the fuel to offset inflation, to invest in our brands and to get back to margin growth over time. And so we started this last year. We delivered $100 million, and now it's about taking another step change and where I'm going to focus is on our supply chain. If you think about it, we're so proud of our supply chain, best-in-class, really strong, but it was built for a different time. And context has changed. You need faster innovation cycles, different packaging for channels. Volume is not what it used to be. And so rethinking that network in order to be able to get at growth is important. We've just started some of that work, and we'll come back and talk at a later time when we have more to share.

Okay. On that piece and transformation overall, can you -- I can definitely see how it's a lever to offset inflation over time, but there's also upfront cost of putting in place those improvements. So what is the ROI quick enough to offset this inflation cycle? Or is it more of a medium- to longer-term investment?

Well, I would expect, given the phasing and the focus of the efforts for fiscal '27, we will see benefits in fiscal '27 from a lot of the activity. Supply chain transformation to Dana's point, and reimagining supply chain is going to require a multiyear phased approach to really see the benefits. And I expect there'll be probably some cash investment as there normally is as you start to reimagine a pretty intricate supply chain network. So that will take a little bit longer to return the cost savings. But I feel good about what we've got lined up for fiscal '27 being able to contribute and help offset some of the headwinds.

Okay. Okay. Let's pivot back to that -- the objective of restoring profitable growth because I think that is probably the key debate. So maybe a little bit of retrospective on the efforts you made in '26 in terms of the price investments and where that's positioned you as you move forward. And then how things change as you move the remarkability investments to product and packaging and communication.

So I think first, if you think about fiscal '26, we made the bold choice to invest. And the first place that we invested was price. And that was really about getting our prices at the shelf right, the base prices right. It was about coming under key cliffs and closing gaps relative to the competition. And as we closed this fiscal year, it worked. We really did see our base volume improved. So if you think about fiscal '25, our base volume was down 10%. We're closing this fiscal year, it's up 1% on the brands that we invested in. If I look to our Pillsbury business, which is our biggest and where our problems were the most acute, if you look at fiscal '25 on base volume, it was down 10%. Pillsbury is finishing the year up 3% on base volume. And the real test as we came through Q4 and started to lap the price investment was, is this going to translate into dollar share gains. And we're in a place now where Pillsbury has grown pound share by 1 point, is back to household penetration growth and has gained dollar share. So we really believe that, that investment has worked and provided us the right foundation. And then I've talked about the other areas that we strengthened, 25% increase in new products, that's working. We invested in omnichannel execution. Our e-commerce share is now for human food at 20% for pet at 30%. And we're better at how we execute within that channel with our shares outperforming bricks and mortar. You think about the communications I talked about, our ROI is on that up double digits. So I feel, again, it's so important that we got the foundations right and not everything worked. We have 2 businesses that have been a real struggle for us all year long, Totino's, where we did a price pack architecture. It just didn't work. We got outinnovated. I feel like we've diagnosed those problems correctly now and are coming with some really good innovation and renovation. And we don't need that to get back to growth. We just need to stabilize those declines. And then our Wilderness business on pet, where we really just had to focus on, okay, this proposition in terms of remarkability across the board is not good enough, and we're going to have to invest from an innovation and renovation standpoint to get that back to growth. So really good progress on the base where we invested. We know what didn't work. We have plans to fix it. And then as I talked about in the beginning, as we pivot to what's next, I really do think there's benefits out there that the consumer values and is willing to pay for if you're talking functional nutrition, bold flavors, nostalgia. And so it's really about if we step up the innovation and the renovation on these $8 billion brands and lead our categories, that's what will drive the next step change.

Yes -- and so is the metric -- I mean there are lots of metrics of success, but is the metric of success in '27 pound -- I'm sorry, dollar share...

In FY '26, it was pound share. It has to be because we're investing in price. Now what I would watch for is the measure of now as we flip and start to lap that price investment, it's dollar share. You'll see it come on Pillsbury, then cereal, Mexican and some snacks. And I do just want to reiterate, we are a growing dollar share on Life Protection Formula on our cat feeding in international and North American food service. So that's the goal.

Okay. And how does that -- I mean, as you watch the -- maybe a little bit of perspective on what you're seeing in the consumer environment and how that -- I think the epicenter of debate this week has really been in North America, the bulk of your business. So how you're watching and monitoring the consumer and how that's impacting your planning process into '27?

Well, I think you probably heard all week long, the U.S. consumer is stressed. They are already stressed going into this new fiscal year that we have with just everyday inflation on everyday items. But then you add to that the SNAP reductions, you add gas prices and it's tough. And so as we just closed our fiscal year in our Q4, we saw our categories slow down by about 1 point. And as we turn to this next fiscal year, we're not assuming that's going to improve. We're assuming categories will stay soft, and our goal is to gain share in those categories and to be the leader and to improve them. But I do want to say that there are places the consumer will spend money on and that are growing. And so again, if you focus your efforts on delivering value in those areas, there's growth to get. So again, functional nutrition, bold flavors, nostalgia and then making sure you might not get a lot of list price, although we'll keep watching that, but you can get mix. If you look at our Cheerios protein example, consumers are willing to pay for that benefit. It's price accretive to our core. The price pack architecture where we're bringing 40%, that will be an opportunity for us to have opening price points that consumers can access and pay for large sizes. So while it's going to be tough, there's growth to get, and it's just about being focused.

Yes. Can you talk a little bit about how your initiatives and your innovations are focused on delivering value to the consumers that are most stressed, the lower end of the K, if you will. And then -- but also going after those premiumization opportunities for consumers who are able and willing to trade up.

Well, I think, first, just getting the foundations of our business right. So making sure that the prices on our core are in the right place for consumers to access was a great start. So having that as a foundation going into next fiscal year is important. If you think about price pack architecture, I think that's critical in today's environment. You have to have the right sizes at lower price points that consumers can access. Larger families are looking for more value. And so it's really just making important that your proposition delivers across all of that, different formats, functionalities, et cetera. We want to understand that the consumer is struggling right now. And so making sure that how we layer in coupons and incentives is matching pay times and that we're helping them get through this. And then obviously, where you have benefits that they're willing to pay for, it's making sure that you price them in the most accessible way. So premium price to the core, which is, again, price accretive to our business, but still accessible to the consumer every day.

Great. Maybe we'll go through a couple of key categories that are topical, some of which you've already mentioned. But you mentioned protein Cheerios was successful. Maybe if you kind of pan out and think about the entire cereal portfolio, which is always topical when we talk about General Mills. How that overall is trending? Dana I'm watching it progress, but we're seeing those value shares still lag. So how do we bend that trend?

Yes. Well, I can't answer a cereal question without reminding everyone that it is a $10 billion category that 8 out of 10 consumers have it in their household. It's really important to our retailers. So we're not looking for this category to drive outsized growth for us. We just need to gain a little bit of share and make sure we're behaving as a leader in improving the trends in that category. So as I think about cereal, I'm proud of our performance this year. We've gained pound share. We're back to household penetration for the first time in a really long time. And the places that we're focusing for future growth are 2. First is protein. I mean people have left cereal because they feel that it doesn't keep you fuller for longer. There's no satiety. And this protein benefit has been really strong. The Cheerios protein has been highly incremental to the business. It's going to be $100 million. We're going to have over $200 million of cereal offerings in next fiscal year, and that's working really well. We'll keep doubling down there. And then there's the granola segment of cereal, which is what's growing the fastest. It's $1 billion, growing double digits. We are gaining share in that segment. In fact, we launched a lot of different granola offerings in January of this year. We've gained 20% distribution. So I really believe that as we go into next fiscal year with the foundation stronger, focusing and leading in protein and granola will be how we get the value share back.

Okay. Great. So I mean that seems -- so that falls more under the functional benefit bucket, maybe a little bit of clean label, but that's the focus there. If we move to snacks and Totino's, is -- what's the focus there? Is it bold flavors? Is it packaging? Where are we going to really stabilize that business?

I mean it's a few things. That Totino business has been an acute challenge for us this year. It's 50% of North America retail pound declines. And so I do think we've diagnosed the issues. Again, we had this price pack architecture. We launched a box, replaced a bag for a box at a time when a consumer just didn't see any value in that. And so it didn't sell. We've fixed that now. We're back to the bag. And then we got out innovated. And so being back in bags, we're able to add some merchandising back again, which is important. We have brought a lot stronger innovation. So we have bold flavors as everything for Totino's, right? And so we have blasted rolls that are coming with flavor on the outside. They're fantastic. And then in the frozen snacking category, 2 areas that are growing incredibly fast are Asian and Mexican. And so we're launching Old El Paso Mexican snacks, and we're bringing Wanchai Ferry over from China, which is a really high-quality dumpling in order to get at those growth trends. So this isn't going to turn overnight. But I do think what we're seeing, we've put some actions in place in our last quarter. We're seeing those declines stem, and I think you'll see that continue into next fiscal year.

Okay. Let's dive into pet because there's a lot of moving parts in pet. Let's start on the cat business, which is I mean the cat category, very strong. Your performance within cat has been very strong. I guess how do you lean into that and keep that going? Are there incremental initiatives you can -- you plan to make to accelerate trends?

Yes. I mean my team always loves to say to me, Dana, cat is where it's at. So as I think about that, the cat -- pet owners of cat population is growing. It's an easier pet to take care of. It's more affordable. We expect those trends to continue. And as you mentioned, we have 3 brands within cat, and they're all performing really well. They're all gaining dollar share. And I think that's because within my portfolio, they have some of the strongest work against the remarkability framework. So if you start first with just with our BLUE Tastefuls brand, this business is growing dollar share, has taste superiority, cats are picky, 9 out of 10 cats prefer the taste of this brand, and we have some really good gravy innovation that we'll lean into. Then we have our Wilderness Cat business, which is protein Forward, so protein-forward innovation messaging, that's working. We'll lean into that. And then we have this Tiki Cat business that's been growing double digits, still has a ton of headroom on household penetration. That's where we'll focus, bring some really good premium innovation exclusive to different channels. And then for the first time ever, we will launch a social-first national campaign to build that penetration.

With Tiki.

With Tiki. So I think the team has some really good plans coming that will continue that growth trend.

Okay. Okay. So what does your team say about dog?

We still love dog too. We're BLUE Buffalo. So love them like family, feed them like family. So I think our dog business is a tale of 2 brands. And I think they sometimes get brought together, and that -- it's not where we're at. Our biggest brand is Life Protection Formula. And even though the dry dog segment has slowed a bit, we are gaining share within that segment. And it's behind us really focusing on what is the consumer value, getting back to benefit-led communication. We've got some really premium benefit-led new products coming in the back half of the fiscal year, getting our sizing right in e-commerce, 30% of our sales is on e-commerce. We've got to be strong there. And then making sure that those benefits show up in the packaging because it's a base business and that will help us a lot. So that is the focus for life...

When you say back half of the fiscal year, that mean -- you mean...

Fiscal '27.

Yes. Just making sure.

Yes. And then in terms of Wilderness, that has just been -- it's been a problem for a few years. And we've been trying to fix it around the edges, and we finally just said, let's assess where we're at across remarkability relative to the competition, and it wasn't good. And we've had to really lean in and fix the product, look at the packaging, look at the communication, bring new products. And so you'll see a real step change in all of that as we go into this next fiscal year. The reality is on that one, again, we're looking to stem the declines, not get back to growth in 1 quarter, stem the declines, which will help us a lot.

Okay. A year ago, when we were talking about General Mills, we were talking about those -- that price gap management, price cliff management. We're also talking about Love Made Fresh. That was a big initiative a year ago within pet. A year later, I guess, what have you learned from that launch? What's worked? What's impressed you? What are you going to lean into? And then maybe what is left to correct?

Well, we're really -- we continue to be really proud of this launch. And what I've been really encouraged about is over the last several weeks, we have seen our retail sales increase 50% versus 2 months ago. And what we've had to fix is, first, on-shelf availability. We had to get more reps into the stores to make sure the coolers were full of product, and that is working. We tweaked some of our brand communications. We've done a great job of building broad awareness, but we need to come down the funnel and really focus on conversion. That's working. And then we launched the standup resealable pouch. And that pouch is already 50% of our sales. So I think in this learning, we're on the right stuff. And again, the sales trends are encouraging. And so as I look ahead, we're really focused on looking at what is our repeat, what are our turns, making sure we continue to get on-shelf availability while also making sure we have a business model that's productive and profitable as we scale. So that will be the focus. We continue to learn. We remain agile. We'll pivot, but we still really believe that BLUE has a right to win in fresh and that our participation in this segment can help it grow overall.

Kofi, in terms of your observations on the launch in terms of the early returns versus the amount of upfront investment, how does that -- I guess, where does Love Made Fresh and the Fresh initiative in general rank a precise number, but like how much of a priority is that as we think about '27?

Yes, it remains a high priority for us. And I think to Dana's point, we're really focused on getting it right where we've built out distribution, improving the turns profile of the business. And we do see this as a multiyear investment, right? We embarked on it, eyes wide open that building distribution, sustaining distribution and then driving consumer trial and awareness was going to take a couple of years to build. So we would expect to be investing heavily in marketing. I think in the near term, obviously, the gross margin structure is going to remain challenged as we're scaling up the business. We would expect that as we hit the right sweet spot in national scale, it actually will be easier for us to either build out a more stable and sustainable supply chain structure either internally or through our partner network. And I think that line of sight will put us on a path to a profitable growth profile for the business.

Is there a revenue level? Or is there -- how do we think about the crossover point when that business for you can turn profitable and cash flow generative?

Yes. I think we're -- I would think about it in terms of a couple of actions. Certainly, distribution will be part of it, but a bigger part is going to be ensure that we have sustainable turns where we have distribution, that the consumer acceptance and the in-store performance is on par with the competitive set. And then I think that's the signal that gives us the space to go out and make the next tranche of investment and really turn the corner in terms of the profit profile of the business.

Okay. Go back to -- let's go back to the operating side of your role and the transformation that you talked about and just the overall kind of evolution revamping of capabilities. It seems what you were after was the real change in the way that General Mills works essentially, which we're hearing from a lot of companies. I think the perception from the outside, my perception is that General Mills is -- was already ahead on a lot of those things in terms of technology investments and we talked about SRM. Where do you guys -- or both of you, I guess, is where do you see the most opportunity? Are there places where you feel you're behind that you're trying to close the gap? Or are you trying to extend the lead?

I'll start and turn it over to you. I really think that if you're going to -- if your goal is to get back to sustainable organic top line growth, then you have to invest in making sure that you understand the consumer, that you're the best at that, that you are eyes wide open about what you offer and if it's better than the competition and that you get there and serve that consumer at pace. We've always considered our competitive advantage to be brand building. But as you go through that COVID period, you're so focused on service and then inflation and we were getting through pricing, it was just not something that we could prioritize at that time. And I really think getting back to that and using this remarkability framework as a tool to help everyone understand what is it the consumer values, where is the growth, where to play and then how to win through remarkability is going to help us get back. That's the foundation, I would say, of our strategy going forward, the capability we're trying to build. And then as you mentioned, we were behind 10 years ago in data and analytics and just data investment overall or tech investment. We made a play there. We invested. It's working. We have a really strong foundation right now, and it's about how do you leverage that to get ahead and stay ahead, using that to improve and be leaders in strategic revenue management and making sure that we are always ahead on our holistic margin management, which is our cost efficiency and then just how we reach consumers. I find it exciting right now with AI and with just how marketing works in the social influencer space and leaning in and testing and moving fast and learning, I think that's going to be key. How you reach enough consumers with the right message is what will make that remarkability framework pay out.

And I think what I would add in terms of additional focus areas as we talk about transformation, I think to Dana's point, we already have a really strong supply chain. This is about fitting supply chain for the future of what demand looks like and how we're going to need to drive growth differentially in a very competitive environment, right? So if you think about our supply chain, it's built to run hyper efficiently at scale. The competitive domain requires us to actually run with faster cycle times and more innovation. And that requires a different footprint, both in terms of physical assets, but in terms of the thought on partnerships and the broader network of external suppliers. So you'll see us be looking at supply chain through the lens of what's actually going to unlock the next 5 to 10 years of growth.

Yes. And you mentioned suppliers and the partnership there. But what about -- how integrated are -- is the transformation with your leading retailers, both in terms of the use of data and digital -- I mean, if you can link that with retailer information and sync up initiatives, all the more powerful. And the same with the supply chain, you're trying to service an evolving retail landscape. So can you talk a little bit about the partnership between yourself and your leading retailers as you embark on these initiatives?

Well, I really think -- I mean, us and retailers who want the same thing, which is to serve the consumer and to grow the category. And so I don't think any of these transformation initiatives work if you don't approach it with partnership with the retailers. And so that's the way we've done it. It's about what are they trying to achieve, what are we trying to achieve and what can we do together for the greater good. And that's really how we've gone about it.

Absolutely. Great. I want to hit a little bit on international and maybe food service because those have been areas of relative strength both in terms of the business trends, but then also -- and maybe this shifts into a larger conversation on portfolio optimization. But in recent months, you've both divested the Brazil business and then this past week, divested the ice cream shop business in China. Maybe a little bit on the state of that business and then what you're trying to accomplish with those divestitures.

Yes. So I think international has performed exceptionally well this year for us. It's actually probably a strong portfolio -- strongest performer in our segment lineup. A couple of key markets. China has seen a really strong recovery driven by strong Wanchai Ferry growth and store or retail store sales of Häagen-Dazs Ice Cream. On our shops business, that has been sort of a long simmering opportunity for efficiency. We've closed a fair number of shops over the past 4 years. And this latest transaction was really about stepping back from running shops. Most -- everywhere else we sell Häagen-Dazs, we have franchised the shops business. That's not our core capability and our core competence. We found a partner who can do that better. We've seen really strong performance in Brazil, but that has also been a market where, to your point, we've made the decision to exit largely because we found a portfolio that is well suited to regional taste, but we have struggled to drive scale and efficiency off of the platform. So we put that in the hands of a Brazilian company that's going to be better able to extract value. And we see all of those things as being marginally accretive to operating profit next year. All things equal, our goal in international is to get to a place of sustainable top line growth. The promise is there. We can clearly see that in some of the categories and certainly in some of the markets, but getting at that growth in the most efficient way is really kind of top of the focus for Dana and her new role.

Okay. Kofi, while we got you talking here, maybe you alluded to the -- those actions as being marginally operating profit accretive into next year. There's -- we've talked about this in the past. You've done this in the past, but maybe just an updated version of your pluses and minuses ledger into '27 because there are a lot of moving parts?

Yes, there are a lot of moving parts, and apologies in advance. I would say, first, Dana referenced the consumer environment. We're not building our fiscal '27 plans on any real improvement in the consumer environment. We expect the value-seeking behaviors we've seen kind of hang over fiscal '26 to continue and extend into fiscal '27. We are very focused on turning our performance to dollar share outperformance in our key categories in North America retail. We do see HMM as being critical to both tentpole profitability, but also support reinvestment in the business. I expect that to be around at least 4%. That will also help us offset inflation, which we would see base inflation somewhere in the 3% to 4% range with some pressure from oil prices maybe being a question mark depending on the duration of the conflict in Iran. So I think that's probably the modest pressure point. We are expecting to use a more -- a broader set of our SRM toolkit, both to optimize and ensure that we're getting leverage in the right places from our investment. But I would expect that to be potentially a place where we will be looking to offset some of that inflationary pressure as well. Transformation, we talked about being an additional contributor, at least at the level we saw in '26. And then I don't want to leave without mentioning a couple of mechanical items. We will see -- this year, we had a 53rd week, which is as a week of essentially a relatively unlevered profit. So that will be a drag as we lap that 53rd week next year. We had a month of yogurt earnings in fiscal '26. So that will be a headwind as well as -- and the one that I'm really very, very happy to take on, which is ensuring that we can pay our people at full incentive, which incentive normalization. Combination of all of those is about 8 to 9 points of profit headwind. So that's kind of structurally what I'd expect to see and then we'll...

You mean mechanical items?

Yes, mechanical items. So I would say we'll fill out the picture on -- with a little bit more precision in 3 weeks.

Okay. I was -- I followed that mostly. I just want to make sure I didn't miss anything. So when we go back to like the incremental investments in remarkability, was that part of that bridge? Or is that...

Yes. So I would expect that -- to Dana's point, we have made significant investments in fiscal '26 on pricing, getting base prices in the right spot. The opportunity that, that creates is for the other 4 levers of the remarkability framework to do a lift, and that's what we're expecting to see. So you will see more price mix as a driver of the top line performance as we move into fiscal '27.

Very good. Very good. Okay. And then I guess on capital, you hit this at the top, but there's been a lot of focus on it. Your confidence in being able to generate enough cash to deliver all this and support the dividend, just maybe elaborate on what you said at the start?

Yes. I think we're in a position right now where we're fully funding all of the growth needs of the business and capital spending, which is our first priority, growth and cost savings and the cost savings is important as well. Second, supporting the dividend at the present rate is -- we're very comfortable. We're obviously not in an environment where either earnings growth or dividend yields or earnings payouts would warrant an increase in the dividend rate, but we are very focused on maintaining it at the current level. And then as I mentioned, after we pay the dividend, the remaining free cash flow will go to pay down debt.

Okay. We just got a couple of minutes left. So Dana, I'm going to give you the final word just to maybe hammer home kind of the 1 or 2 main takeaways and maybe the 1 or 2 things that investors should be most focused on to gain confidence in increasing momentum.

Well, I'll end where I began, which is we are focused on restoring our business back to profitable top line sales growth. The markers that I would look for are first dollar share. You should continue as we go into this next fiscal year to see strong dollar share performance in North America food service and International on Life Protection Formula and cat feeding. And then in North America retail, as we start to lap the price investments, you'll see us start to improve dollar share first with Pillsbury and cereal, then the snacking businesses will come along. So that will be the indication that this remarkability investment is resonating with consumers. And then the other area I'd watch for is, are we doing what we said we'd do in delivering our cost efficiency with HMM and the transformation that Kofi and I have been talking about. Those would be the 2 areas I'd focus on.

Okay. Great. With that, we're right just about out of time. So I will leave it there. Thank you very much for your time. Thank you all for joining us.