Flowers Foods (FLO) Barclays 17th Annual Global Consumer Staples Conference summary

Consumer and category trends

• Consumer remains under pressure, but premium and value segments are both performing well.

• Branded bread retail units grew 1.5% in Q2, with Dave's Killer Bread up 7%.

• Private label lost share in Q2, but new private label business is being added at higher margins.

• Bread category outperformed broader food due to its staple status and high purchase frequency.

• Middle-tier brands face pressure, prompting efforts to further differentiate offerings.

Promotional and pricing environment

• Promotional activity has increased but remains below pre-pandemic levels.

• Promotions are more efficient, with higher units on promotion but less trade spend.

• Average price in Q2 was up slightly, under 1%.

Innovation and growth strategy

• Innovation and differentiation drive growth, with two consecutive years of top new items in the category.

• Keto and gluten-free products have gained significant share, nearing leadership in their segments.

• Geographic expansion is a key focus, with low market share in the Northeast and Midwest offering growth potential.

• Expansion into snacking with Dave's Killer Bread snacks is attracting new consumers and exceeding category velocities.