The Kraft Heinz Company ($KHC)

Okay. Welcome back, everybody. Thanks for joining us, and thank you to the Kraft Heinz Company for being with us today. For the first time as Chief Executive Officer of Kraft Heinz, Steve Cahillane is with us today; as well as Andre Maciel, Executive Vice President and Global Chief Financial Officer. So thank you both for joining us.

Thank you.

Thanks for having us.

All right. So we're going to use the balance of our time today for Q&A. And I -- sorry, I thought, Steve, we would just start with you, and I really just get you to describe the updated Kraft Heinz story because I think a lot is underway, and I think investors are curious as to what's changing and what's changing for the better.

Well, again, thanks for having me, and thank you all for your interest. I'd start by saying, I joined Kraft Heinz in January. And I joined because I wanted to join. I mean I really saw the opportunity in front of us as being one that was real, it was tangible, it was exciting, and it was executable. And I draw a lot of parallels towards 2017 when I joined the Kellogg Company, and I joined there because I really want to, the same opportunity. So what we have at Kraft Heinz is we have some of the most iconic brands that I've been privileged to work on starting with the Heinz brand. Heinz brand maybe only rivaled by the Coca-Cola brand in terms of its saliency, how it's known around the world. But compare the household penetration of a brand like Coca-Cola to a brand like Heinz and you immediately see what the opportunity is. The opportunity to grow the Heinz brand, both domestically and internationally, is incredibly exciting. And beyond catch-up. So you go to the U.K. and you see what Heinz does in everything from big Beanz in ketchup, now tomato sauce is really exciting. You see what Heinz does in the United States around condiments, it's really exciting. But we're -- even with a brand like Heinz only scratching the surface, I think. But then you look at the vast majority of our portfolio. And what you see is, again, tremendous opportunity the brands have been, I think, under invested in for the last 10 years. And I always want to be very careful about talking about the past because I don't want to disparage the past or what happened, but it's clear that we did underinvest in the brands. And what we have now is a real opportunity to do something different to think about revenue generation as the most important state of the company to think about our productivity as something that enables our top line ambition and not in an end of itself. And so as we launched into January and announced the separation of the the pause of the separation, I think what we saw is a real opportunity to actually take the resources that were designed against the separation and put that towards a top line agenda to incrementally invest $600 million instead of spending $300 million in affecting the separation. So in effect, a $900 million turnaround towards resourcing top line agenda. And what you see, I think, coming out of the first quarter is early green shoots, early. I mean no victory laps here, but early green shoots around our share progression that's more positive than it's been in 10 years. And so that's meaningful, but it's something to build on. And we still have the rest of the year in front of us, and most of that $600 million as dry powder that hasn't really even been deployed yet. So early days are encouraging. I got asked this morning, I think a great question. What's the morality of the organization? Morale is incredibly high. When you talk about restructuring, an anxiety kind of infused thing when you talk about a growth agenda, that's something different. And so I'm pleased I joined. I'm pleased with our early start, and I'm really excited about the future that we have in front of us.

Great. As you say, that $600 million of incremental spend, I think, is the most visible component of your new initiatives, our new agenda. I guess you talked a little bit about this in the past, but maybe to ground everybody in the room on it, why $600 million? Why is that the right level of spend? Why not more, why not less? And how are we assured that it's not just spending for spending stake?

Yes. So $600 million is a nice round number, right? And I don't want to ground anybody with trying to convince anybody that there's a false sense of precision that's exactly the right number. But we did an awful lot of benchmarking around what would be the right level of investment for a company like ours. And so we think 5.5% of net sales against marketing is a good benchmark number. That's what we get to at $600 million. We think 1% of R&D is a good number. We looked at our overhead as a percentage of revenue compared to our peers. We were underinvested. And just in my first few weeks in the organization, really talking to people in our commercial organizations around what they felt they needed, where we were lacking, that's led to our human resource plan as well. And so we think it's a really good number. We think it's the right number. and we reserve the right to get smarter. And so as we embark on this year, we're ahead of plan in the first quarter, as we talked about, if we continue to generate healthy returns against this investment perhaps we could go above $600 million and still meet the guidance expected in terms of profit. That wouldn't be a bad thing. And that would -- that's our priority. So our priority is getting the right level of investment and $600 million, I think, incrementally this year is the base mark. We might go above that. Do I think we'll get to 2027 and say, "Oh, my goodness, that's not enough, we're going to have to have a margin reset? No, I don't think that at all. I have, based on the work that we did and based on the early green shoots and based on just my experience in and around this space for many years, I feel very confident. I feel very confident this is the right number, and I feel confident we might be able to overdeliver against that number. And again, the early green shoots, I think, are early proof points, and we'll just continue to get smarter and build on that. And part of it is it's not just the number, it's how you -- the quality of execution, right? And so really focusing on the quality of execution, how we do things, how we measure them and how we reallocate in fast ways, really reallocate based on learning and the learning is happening faster than it's ever happened before, thanks to the technological revolution that we're in. And so I believe it's the right number. I believe we might do better than that number. And I believe that execution is the single most important element in getting the execution right.

Okay. So Andre, maybe you can weigh in here in just in terms of a little bit more detail as to where that spend is going, where it's being prioritized? And to Steve's point, kind of the scaffolding that you've built around the organization to learn as you're spending to double down on places that are really working and also pare back on things that have less of an ROI.

So about 2/3 of the $600 million is going towards I think what Steve was just describing, like the commercial levers that will drive sustainable top line growth, particularly on product packaging superiority, market investment media pressure and commercial head count to improve the quality of the execution. So 2/3 is going against that. 1/3 is on price. This price is a combination of opening price points, which I believe is highly critical in this moment that the consumers are going through as well as a step-up on joint business plans with the retailers, so we can continue to protect and expand shelving where appropriate. The second part of your question?

Just what have you built around -- you put the spend in place and what disciplines or processes have you put in place to to learn as you're spending to be able to, as I said, double down on things that are working and then pare back on things.

Were you torturing your colleagues to make sure that the money is working right?

I'm good at that. But -- now look, we have a very strong routine in place like pricing, for example, which is easier to manage in the short term, like we have very good controls on a granular level. You might remember, we said years ago, we have a very detailed promo system that allows us to track returns on like more than 100,000 events in the U.S. So we have fair granular visibility on that. and the revenue management team have a very strong group that continues to learn from what just happened to be deploy into the future. So we feel very good about the price. Marketing. We have invested a lot in last year to have very good visibility on the returns we have of market investments and gets updated regularly as well. So we feel good about that. That's our topic of discussion. We have been here with us that leads our European business. Like every month, we go through the dashboard and how we are deploying the money, what are new ideas I have, what things are not working, how we can activity we deploy the resources. We're very well set up for that.

And as Steve said, most of that spending is still to come, right? It's back half loaded. So as the spending ramps, is this simple as market share and top line growth? Or are there other metrics that you're watching to define success?

I think the most visible metric for the investors will be the market share trajectory as well as our emerging markets growth. So on market share, look, at some point last year, we were losing 90 bps of share, which was record high for us. We exited the last year, losing 50 bps, we are in 30 bps and last 4 weeks we were losing 20 bps. So these are moving gradually in the right direction and to your point, the bulk of the step up in the $600 million is concentrated in the second half, which is encouraging. Emerging markets, which we still have a high degree of confidence that they can deliver that high single-digit, low double-digit growth and we have -- even in the first quarter, we already -- if you exclude Indonesia and we talk at Indonesia a few times already, we already grew high single digits once we lap Indonesia, which we feel good about where we're going to stand in the second half, we're going to see the growth in the print as well, which should be very solid.

Yes. Okay. So as you -- as Andre just alluded to, Steve, you mentioned earlier, good promising start to the year and through today. But you also highlighted along with the first quarter reporting some timing benefits, Easter, some pantry loading benefits some -- et cetera. So I guess when you look at everything you've seen so far, where do you see the strongest signs of real structural improvement versus other areas that might be a little bit more kind of flatter by those dynamics?

Yes. So Andre mentioned some of it. But if you just remember back to our first quarter, we did say we got about 100 basis points because of Easter. We got a little bit more than that based on winter storm, stocking up and so forth. And so I think we're very transparent around look, the number was still not a growth number, I think it was minus 0.4 or so, but we tried to equalize that so people really had a sense of what it was. But we still felt good about it because of the market share progression that Andre just mentioned. And so we exited the year. We put a new metric in place. We're talking about where we're gaining or holding market share on a weighted basis. We exited the year last quarter, fourth quarter of last year at about 25%. So we're only gaining or holding share in 25% of the categories. And even in the U.S. Taste Elevation, which is where we really have a right to win with Heinz in Philadelphia and others, we were only at 24%. So we were not winning and if you look at where we exited the first quarter, those numbers were dramatically different over 50% and with U.S. Taste Elevation I believe, close to 80%. So a really dramatic shift in terms of that. And that's real because that's market share based on where we are. And if you look at the last 13 weeks, we've held that U.S. taste elevation in the almost 70% range. So it's been holding. And it's based on the investments that were made in the back half of last year and continuing into this year. And as Andre just mentioned, we're holding or gaining market share in more than half the categories. And we're going to talk about that a lot because it's a way to hold ourselves accountable that we are committed to growing the top line of the business. And obviously, we're all about shareholder return and one of the most important elements to companies like ours and one of the most highly co-related to your stocks is your organic growth profile. And so we can't control the macroeconomics everywhere in the world where we can control how we perform within the industries. And in many cases, we're industry leaders. So part of it, industry health is incumbent upon us as well. But what we can really control is our ability to compete well in the market and gain or hold in more than 50% of hopefully closer to 70%. And we're seeing early green shoots of that happening. And so we're encouraged, but it's a high standard, and we're going to hold ourselves to that high standard. And we invite investors to question us about that, and we'll be very transparent about how we communicate what our performance is so that, again, we can hold ourselves accountable.

In terms of the investments you've made, what percentage -- I mean what percentage went against those taste elevation categories that have the highest future growth prospects versus sharing up the foundation of the kind of the former -- formerly known as North American grocery...

You have to do both. So there's an element of where if we've underinvested in certain brands in certain categories, and we've got some key buckets, think about an Oscar Mayer , for example we need to make some investments in packaging to improve our Oscar Mayer performance. We know that. And so we will do those things. But the highest returns we're going to see and where we're really going to push forward is in some of our really iconic brands, Taste Elevation brands, so Heinz, Philadelphia, clearly areas where we can invest -- you saw us invest in Power Mac, our new Kraft Mac & Cheese, which when I came, it was already developed, but comfort food like like craft, Mac and Cheese with high protein and high fiber is a pretty compelling offering, I think, for consumers and retailers certainly saw it that way. And retailers got even more behind it when we upped our investment against it. So you have to have a balance. You have to do both. But as we charge forward, we'll want to have a maintenance level of investment around what we call hold and a winning level of investment against our Taste Elevation, where we feel like we really have a right to win, and we've got brands that are very responsive.

Yes. And as you talked about, it's a multifaceted -- you've got more marketing, more investment in the innovation pipeline to market around, more commercial abilities, some investment in value, which of those buckets maybe there's more, do you think was -- is the most important for the company to fix?

I'd say, really, our innovation and our equity brand building are 2 elements that are really very important. Because when you look at our portfolio, 1 of the things that you see is our brand awareness is very high across the board. So think about brand saliency, people know our brands. But how that translates into household penetration is not always as strong as it needs to be. And there's 2 elements to really drive that household penetration higher when you have the type of sales that we have. And that's through brand equity investment and innovation and getting both of those elements right. And so you've seen a lot of what we've done, and I've talked a lot about this. A great example is what we've done with Capri-Sun. It's a brand that has got very high saliency. But you saw consumers which are basically young children drop out at about age 12 because we weren't innovating around what it would take to keep a 12-year-old turning 13 in the category. Now it turns out it's a pretty simple innovation -- it's called the plastic resealable bottle. And so I teased the team about that. But it was really smart because they took a real consumer insight, okay, when consumers in this case, young children age from 12 -- 10, 11, 12 to '13, '14, '15, it's no longer cool to have that little pouch that they had on the soccer fields when they were young, but they love the brand. And so coming out with a plastic bottle was a way to actually age with the cohort, and it's proved to be very successful. And, by the way, opened up 25,000 or so additional doors and convenience stores where we weren't. And so a really terrific thing. And now we're just launching Capri Sun in the plastic bottle with electrolytes. Again, a hydration for the mom, dad who's shopping for their child and doesn't want perhaps all the sugar of a sports drink, but they want something that they trust, and it's got electrolyte. So there's a lot of examples where we've got the brand, we've got the saliency, but we haven't had the right level of innovation and brand equity investment behind it and the $600 million in getting to 5.5% and 1% of R&D really helps us accomplish some of those things.

I'm sure there are a lot of people in the room who are listening to this and saying, okay, this makes sense, but the U.S. food industry is no growth, right? The brands have tried making investments, and we just haven't seen companies be able to sustainably bend the trend, health and wellness, GLP-1, all the things that we've talked about for a long time. Why do you think Kraft Heinz can be different?

So I think a couple of things. Andre reminded me that if you just look at the categories that we play in, in the United States, the growth standing still holding share would be 1.7% or so, okay? So maybe not the most exciting thing in the world, but it's growth. That's positive. And so how do we perform better within that? And that's all the things that I've just been talking about. And I think a lot of times, not everybody, but there's an element at a high level where the center of store gets painted with one brush and it's not exciting, it's not growth. And I would advance the idea that there's going to be winners and losers for sure. And there's going to be differentiation between those center of store and between companies like ours that make groceries writ large, and there has to be. And we will be and aim to be one of those that stands out among the top performers within that category. So what does that mean? It means north of 1.7% growth, which could be -- if you double that at 3.4%, that's the kind of the algorithm that existed in the past that can be quite exciting when you manage your middle line very well and you get high single-digit operating income returns, and that translates into double-digit total shareholder returns for businesses like ours. And so I think that, that may not be NVIDIA, but it can be very exciting, and it can be very appropriate for an investor to think about companies like ours and center of store, don't look at everybody with the same brush and think about who's going to be, which companies have the potential to win within that. And I think our portfolio sets itself up very, very well to be one of those winners because we've got iconic brands that have been underinvested -- and as we get the investment levels right, as we get the execution right, as we get the organization really rallied around a top line agenda, I think it's going to be exciting what we can accomplish.

Great. One element, not the element that you've highlighted is most important, but one element is fixing value equations and pockets of the portfolio. And maybe you can both weigh on this one. We've seen other companies, food and otherwise make those value investments, see some volume response, but not necessarily see it translate into a sustainable share or even a positive calculation. How have you approached that? What are your objectives in making these value interventions where you are? And how do you guard against just promotion to estimate some volume, but not really getting the positive full ROI.

Well, I'll start and maybe Andre can weigh in. I think -- and I don't want to comment on what others have done, but we are taking a much more surgical approach to when we think about pricing. And we think about it from the consumer standpoint, of course, and we think about affordability. And so we analyzed where are our gaps relative to competition, where our gap relative to private label and where are opening price points. And where do we have an opportunity to present to the consumer a more compelling value proposition and value is price. And so I think if you just look at price, it's going to be more difficult. And all the things I just talked about in terms of innovation and marketing and consumer communications, getting the whole bundle for the consumer exactly right, but making sure that we put a real focus on affordability at the same time, I think, is really important because there's no denying what's happened the last for 5 years has been unprecedented. I mean we had COVID, obviously, we had supply chain shocks. We had inflation the likes of none of us in this room have ever lived through. You have to go back generations to see that. And so you have all those things which has put the consumer under pressure, but the consumer still responds to brands that they love when they're presented with ideas that are value accretive to them. And so we've looked at price as an element of that, but only an element. And I think that's the important differentiator.

Andre, anything to add?

I think, Steve covered like the thing the key points here is surgical investment and again, it's 2/3 of our $600 million is going against like sustainable long-term initiatives, like its marketing R&D, so you can innovate better, we can show brands out there, continue to evolve the attributes and the product and invest a lot in strong marketing sales people that can execute well.

Okay. Steve, you mentioned some of the retailer, not even acceptance, sort of excitement around the plan. Can you talk about how you're positioning the company to work with retailers, I guess maybe the level of retailer engagement and what you're trying to do and just how you're positioning yourself to be more integrated with what seemed to be increasingly powerful retailers where we're seeing consolidation. I think of the U.S., but -- so just to a level of -- as you're making all these changes, we've talked about what you're doing, we talked about what the consumer is looking for, but in between, you have a retailer who's really important partner. So how are you trying -- how are you positioning to maximize that partnership?

Yes. I think the reception from the retailers around our paused transaction and our reinvestment -- I don't think I know it has been extremely positive. I've gone and visited them and I've talked to them. And as big as some retailers have become as important as they've become as consolidated as they become, we're still very important to them. We're in most aisles of their stores. We're in their omnichannel world. We're doing everything that we can to be a leader and a good participant in good category dynamics. And I think to the extent when retailers really believe that, and understand that your commitment is to growing faster than the rest of their box and therefore, being a tailwind to them and not a headwind is very well received. And that's what we've tried to do is build plans with this incremental $600 million that really speak to the consumer through the retailer, right? And so that's been very well received because if we are not growing, then we're a headwind and we're too big to be a headwind. And retailers don't want us to be a headwind. They want us to be a tailwind. And so it's finding that overlap with retailers with great consumer plans and if you -- when you find that overlap strategic overlap and they understand that your absolute objective is to be good stewards of the category and grow your brands within a very healthy category probably leads to a very good conversations. You have to be willing to listen. You have to be willing to take the pushback. You have to be willing to understand what their needs are. But I have found the retailer dynamic to be extremely positive, but but especially coming out of the reset because they -- it's in their best interest to have a healthy Kraft Heinz.

Yes. Okay. Can we talk about the balance between more bets more bets, more investment across more categories and more brands versus bigger bets. I think you have you're doing a little bit of both, but I think you've talked about emphasizing fewer bigger bets. Where are the bigger bets being placed? And how do you -- what kind of discipline and information have you built around your internal processes to make sure that where you're making those investments is the right place?

And so we are trying to do bigger and fewer particularly as it pertains to innovation. -- because the focus of the organization and the resources of the organization can be best deployed when you really have that focus. And so think about the big brands like Heinz and Philadelphia and Kraft, Mac & Cheese. We're going to see some -- you're going to see -- continue to see some big investments around that and some of the platform innovations that we're doing. So I think Heinz simply and Heinz 0. Those are platforms with a lot of potential. That simply speaks to consumers who are looking for clean label, who are looking for health and wellness who are looking for nutrition. So things around nutrition and convenience and our big brands are areas where we'll see some real focus against. Now having said that, we can do both, right? We can't neglect when we have such a large portfolio. And I often think if a small family own the Grey Poupon brand, would it be better performing. I think the answer is probably yes. So how do we do both of those things at the same time and take brands like Lean parents, like Gray Poupon, they are absolute gems and are small in our portfolio and give them the right level of focus. And that's part of the human resource investment that we're making and putting really talented people against that giving them the right level of resource and letting them go run and win. It doesn't distract the rest of the organization and you can do both. So from a magnitude, you're going to see the big platforms against the big brands with innovation, but you're also going to see us look at some of these really unpolished gems in our portfolio that perhaps haven't had the right level of execution, get executed against. And I think they can grow a lot better than they have been in the past.

Okay. How far out are you -- is your -- how far are you planning, right? I mean -- or how far out is the innovation pipeline being built, the program is being built. I think we're all looking at money being spent today and looking for the early green shoots and signs of progress. But in your own internally, how much work is being done to tactically put in place '26 plans versus building out a pipeline for '27 and beyond?

So we're just starting our 3-year plan right now. And so the minimum for the innovation pipeline will be the 3 years that we're looking at right now. But realistically, it's double that because a lot of the food scientists work and the real breakthrough here you're looking at projects that may not come to fruition for 5 or 6 years. And so we're looking at really a 6-year horizon around realistically, what should we be working on that will take that amount of time, but with the real pressure against the 3-year horizon as we build our 3-year plan. And then in the fall, you get to like really finalize what a 2027 plan looks like.

Okay. When does the -- is the 3-year plan come to fruition in concert with the end of this year? Or when is the -- you're building it, when does it finish?

It really finishes before the end of the year because it transitions very quickly the first year of your 3-year plan, better of the year 2027 budget. That's the way I've always focused on things. I know Andre thinks the same way. And a grade 3-year plan always gets in my experience, you build it every year because you're just tacking on another year. And when you really get humming, the first year of your budget is the last year that you're working on.

Okay. If we zoom out a bit, Andre, in the past several years, and we've been on this stage we've talked a lot about technology and capability building inside the company. And yet there's -- now we're back to kind of doubling down and investing. So is part of the capability gap that's being filled? Is it technology? Or is the organization actually in a good spot from a technology and consumer insights foundation, and it's really the people and the marketing to be able to utilize that technology better. Where are we? Because it seems a little bit disconnected from all of the forward thinking of the past relative to kind of a reset and reinvestment phase now?

Technology continues to be an important pillar and technology growing so fast. We need to evolve together with it. As we have mentioned several times, we invested a few years ago in our revenue management structure. We feel very good about what we have in the U.S. alone have about 50 people fully dedicated to it. So we do have very good techniques on how to -- we identify the best type of tactics. We made good progress as we have been reporting periodically. We improved our pro ROI 20 basis points from '21 to '24. We move into a position of having net ROI positive the promotions. Last year was not a good year, as we have indicated as well. We believe that has a lot to do with sales execution. So we feel very good that with the investments you're doing headcount on sales, that will help tremendously. We have already got lessons from last year and already pushed some of those in place this year. So even year-to-date, we saw improvement versus over last year. Still more to come, but I think we're moving in the right direction. But technology continues to be a main pillar. And we think we need to continue to involve with that. We feel very good. We have a sizable organization that all they do is AI. And those -- this team is being led by different functions. So there is a lot of effort right now starting from the top for us to have the organization embracing that faster and faster across the board.

Okay. Steve, when you came in the organization, did you -- where did you find maybe the organization was surprisingly ahead versus things that you needed to accelerate from a capability standpoint.

One of the really positive surprises was our level of awareness consumer insights and technology, as Andre just mentioned. And so there's a good capability. There's a lot -- we were not suffering from a lack of understanding what was happening. And so that was a very positive thing. If we had to rebuild our consumer insights, it would take a lot longer. So the consumer insights, the team, the capability, the technology, I think, was really I was impressed by I was really impressed by.

Okay. I want to hit on a couple of things before we run out of time. From a financial perspective, Andre, there's a lot of focus on SNAP productions in the U.S. And you called it out as a real near-term headwind for you. I guess how are you -- I guess, how are you sizing that impact as you see it today? And then what are you doing more tactically to to mitigate some of those impacts where you are seeing them.

Yes. So as we have said in earnings, we anticipate 100 bps headwind, linkage to SNAP reductions. And we are seeing some of that coming to fruition. Now if you look at the latest 8 weeks or so in sellout effect in the sector. The best mechanism of defense is productivity, to be honest, because we continue to go through inflation, right? So despite everything. This year, we are anticipating about 4% of inflation, which is twice the normal rate that we have seen in the past. And I think because of the good work we have been doing in productivity, and now we're going for the fourth consecutive year of being delivering 4% of COGS, that has helped us a lot to alleviate avoiding heavy to take as much price as well normally do. So this year, we're only pricing 20% of the inflation. I think and productivity continue to be a critical pillar for us moving forward as far as we protect the consumer in this moment. Now with that being said, as Steve mentioned, like a portion of our $600 million is going against these price points very surgically. So in about -- there are very specific categories like salad dressing, pasta sauce, et cetera, that we are making sure that we have that particular SKU that we are offering to the low-end consumer to protect them at this moment.

Okay. What about from a -- from a cost perspective in the background that we've talked a lot about at this conference and in general, just about the rising cost backdrop. As you're looking to invest $600 million or more, costs are rising in the background. How -- what's your level of confidence that you can withstand that rising inflationary backdrop in 2016 and also your level of confidence that, that doesn't become an increasing headwind the cars have stepped down into 2017?

So look, as I said in earnings we feel we are hedged for the short term. So I think our near term is very well protected. And the productivity, we play a very important role as well. If this inflation that is currently expected to hit in 2027 as hedges roll off, productivity be again, the main mechanism defense. And if you get to a situation where the whole industry is surprised because of the magnitude of the inflation, like we will do so. But again, it's a nice smart way and trying to minimize this. So I think there is a lot of effort on our side to do the best we can with productivity. We have -- we are currently working on how we can further step up from where we are today, so we can protect the consumer in this moment. Yes.

Because you've said 26% is a margin floor and nothing at this point deters you from that outlook, correct?

That's right, yes.

I guess from a balance sheet perspective, Andre, you've got some maturities coming up, you've taken some steps there. I guess just how are you thinking about the capital structure and capital allocation priorities from here?

We feel very good about the cash flow generation of this business. Last year, we delivered way more than 100% of cash conversion this year where we won't track to deliver that against -- and I think the excess cash that we have been generating and a strong balance sheet have allowed us to step up $600 million in investment and don't compromise any of our capital allocation priorities. In fact, it's preserving the dividend that we have, which is very attractive, maintain investment grade, those are table stakes for us and they're very important. We have excess cash still generated even with the $600 million that we still have flexibility. If you want you to so to step up more investment, we can do that. So we're in a very good position. Our dividend is very well protected at this moment. As you alluded to, we just -- we are paying down $1.9 billion of debt now in this quarter. We are actively now looking at the 2027 because we have another big maturity coming through, and we are strongly considering anticipating paying down that because we have a good position of cash on hand right now. We just issued a eurobond that allow us to get out of some expensive bad debt that we had in our debt. That alone was very successful as we are very oversubscribed. We were able to reduce interest expenses, $300 million over 10 years, was very successful. So I think, again, we feel very good about the cash flow generation of this business. We feel very good about the cash flow discipline, balance sheet is in order, the dividend is well protected. So I think we're in a good position.

Okay. we're almost out of time. I guess, Steve, as we wrap up, if there's one thing that investors should remember and hold Kraft Heinz accountable for to judge success over the next year, what would it be?

It'd be organic top line growth momentum building based on our share performance. And so we've been very specific about that. And this is not a cost savings story anymore. This is a collection of phenomenal brands that have been underinvested, that are now going to be appropriately invested in and that will win share partner with retailers to create something that I think is going to be differentiated from many of our peers.

Okay. With that, we're out of time. We'll end it there. We look forward to hearing and tracking success over the next coming quarters, and we'll see you back here next year. Thanks so much.

Thanks, Steve.

Thank you.