Good morning ladies and gentlemen and welcome to the ConAgra Brands' Fourth Quarter Fiscal Year 2017 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Brian Kearney, ConAgra’s Director of Investor Relations. Please go ahead sir.

Good morning everyone. I’m Brian Kearney, ConAgra’s Director of Investor Relations. Johan Nystedt has taken on a new and very important role as the Chief Risk Officer, while also keeping his existing Treasurer role. In order to focus on his role of evaluating and managing enterprise wide risk, Johan will be transitioning his Investor Relations duties to me. I thank Johan for his leadership, as we have transitioned from ConAgra Foods to ConAgra Brands. That said, during today’s remarks, we will making some forward-looking statement, and while we're making these statements in good faith and are confident in our company's directions, we do not have any guarantee about the results that we will achieve. So, if you would like to learn more about the risks and factors that could influence and impact our expected results, perhaps materially, we'll refer you to the documents we filed with the SEC, which include cautionary language. Also, we will be discussing some non-GAAP financial measures during the call today, and the reconciliations of those measures to the most directly comparable GAAP measures for Regulation G compliance can be found in either their earnings press release, or in the earnings slides, both of which can be found on our website at conagrabrands.com/investor-relations. Now, I'll turn it over to Sean.

Thanks, Brian. Good morning, everyone, and thanks for joining our Fourth Quarter Fiscal 2017 Earnings Conference Call. Remarkably, it was almost two years ago to the day that I hosted my first call as ConAgra’s CEO. As you may recall, the company had its hands full at the time and I shared my initial assessment of what we needed to do. I told you that I saw a tremendous opportunity at the company, but that unlocking it meant we had to move quickly and take bold actions on a number of fronts. Well today, two years later, I think it’s clear this is a new era and we are a new company. Yes, ConAgra is about 100 years old, but for the first time in our history we are a focused pure play branded CPG Company. Becoming a pure play has enabled us to sharpen our focus on the critical elements necessary to improve performance. We’ve moved from an emphasis on unit volume to a focus on value and from a reliance on trade discounting to a strategy based on renewed brand relevancy. We’ve moved from a tendency towards SKU proliferation to being clear-eyed about SKU optimization. Our A&P support and innovation programs are far more disciplined. We have aggressively addressed our cost structure and we’ve become leaner and as you’ve seen our margins are far stronger. Overall, by relentlessly following the portfolio management principles we shared at our Investor Day, we’ve clearly positioned the company for better long term value creation. In deed we’ve moved quickly and taken aggressive action over the past two years. We’ve reshaped our company and our portfolio, exiting private brands, as well as non-core businesses like Spicetec and JM Swank. Soon we expect to add Wesson to that list. We flawlessly executed the Lamb…

Thank you Sean and good morning everyone. Before I start, I want to review a few points on our basis of presentation and the related joint ventures have been reclassified as discontinued operations since the second quarter of fiscal 2017. The commercial reporting segment has no current operating results. Since the second quarter, it has only included the historical results with the Spicetec and JM Swank businesses, which we divested in the first quarter. References to adjusted items refer to measures that exclude items impacting comparability. These items are reconciled to the closest GAAP measures in tables that are included in the earnings release and presentation deck. Moving on to our results, as you can see on Slide 22, we continue to make strong progress improving our financial profile as we reshape our portfolio. Reported net sales for the fourth quarter were down 9.3%, and net sales excluding the impact of divestitures and foreign exchange were down 3.6%, reflecting sequential improvement against our first half and third quarter net sales growth rates. For the full-year, net sales excluding the impact of divestitures and foreign exchange were down 5% in-line with our estimates. Adjusted gross profit dollars were down 5.1% for the fourth quarter. The sale of Spicetec and Swank drove 3 percentage points of this decline. The remaining decline was from lower volume and unfavorable FX, partially offset by the gross margin rate improvement. Adjusted gross margin was 29% in the fourth quarter, an increase of 130 basis points. Approximately 70 basis points of improvement came from divesting the lower margin Spicetec and Swank businesses. The remaining increase came from supply chain realized productivity gains and improvements in pricing and trade efficiency, the benefits of which were more than offset by the negative impacts of increased inflation. For the full-year,…

Good morning everybody.

Hi, Andrew

Good morning.

As I recall, I think back at your Investor Day, I think it was Supply Chain Head, Dave Biegger, he had mentioned that M&A as potentially an incremental benefit in terms of a much more significant I guess supply chain unlock, and therefore the potential for additional margin opportunity, and I guess volumes in the industry as a whole in ConAgra maybe taking a bit more time to come around. I guess for ConAgra, does larger M&A became more of a necessity to sort of hit your current margin goals given negative fixed cost leverage and such?

Yes, Andrew our long-term algorithm does not make an assumption in terms of any kind of scale deals, so the long-term numbers that we reaffirm today are basically us running our base play. The point Dave was making at our Investor Day is that we have our top notch supply chain team that has been extremely active in the industry reducing the number of plants by 30% in the past six years or so, achieving realized productivity of 2.8% on average year-in your-out, which translates if you use to the measure of gross productivity through significantly higher number, as well as base plans to further increase realized productivity 15% and 20% by 2020, as well as commenting to get $400 million of working capital. So all of those things are assumed in our long term algorithm and get us to our long-term algorithm. The point he was making on M&A is to the degree we all have conversations about bigger transformations within our supply chain. There are other concepts out there and that last slide that shared in that presentation - that are really conceptual in nature, which are things like joint ventures, consolidation of supply chain networks, and things like that. Those concepts always offer incremental opportunity, but what Dave was pointing out, those are things that we are always open to and we will always contemplate, but they are not assumed as required in order for us to get to our long-term algorithm.

Okay. Thanks for that, and then when do you anticipate that the change or decline that we have seen in distribution points should trough, I guess such that the velocity improvements that you site in the slides can start to really show through in terms of volume growth, because I think you did expand the work you’ve done.

Yes, you have seen this year, it has been a fundamental reset of top line and a big part of that and it varies by business, bank was a good example of where we have done a lot of SKU rationalization including in this past quarter in Q4, but you have seen trends abate there. So, as we start to wrap those you're going to see those change and obviously we are quite pleased and excited about our top line prospects this year calling for a minus 2 to flat, which is a trend bend on our topline of 300 basis points to 500 basis points, which is probably some of the stronger bend in the industry. And that obviously reflects wrapping this - the heavy lifting we have done this past year, but also the confidence we have in our innovation programs, and our plans to rebuild TPDs, total points of distribution in higher quality read this year. So you will see that and I think as you think about our topline you should think about it as just like you’ve seen recently building momentum as we proceed through front half to back half quarter-to-quarter so to speak.

The next question will come from David Driscoll of Citi Research. Please go ahead.

Great, thank you and good morning.

Hi, David.

Good morning

Wanted to ask a few things here about new products, in your Investor Day you laid out the 2020 goal of 15% of net sales to come from new products, can you talk about this slate of F-18 new products, how it fits into that goal, how impactful you think these new products can be? And then can you share just what is the philosophy on the gross margin impact from new products? Do you have, kind of mandatory rules that the teams have to live by on the gross margin benefits or accretion that comes from new products?

Yes absolutely. Let me hit those David. First of all the metrics David, we call it in renewal rate, which is percent of annual net sales that come from prior three-year innovations and historically we were I think in the high-single digits range. Our goal is to get that to about 15%, not in a low quality way because we’ve got experience with SKU proliferation in the past, but in a higher quality way and we're making good progress this year just with the innovations like you have seen, but keep in mind when it comes to innovation we effectively, not only did we rebase our topline this past year, we basically pushed pause on all innovation, so we could rebuild the pipe in a higher quality way, which is the stuff you see launching this year. So we will get better at that as we go and we will do it informed by our portfolio segmentation and our improved insights and analytics capabilities, but when we do evaluate future innovations, we do challenge our teams to always pursue margin accretive innovation. Now sometimes in the early days of an innovation you will see a little bit of a lower gross margin, if we choose for example to go to a co-packer because in those cases, we want to prove out our thinking before we invest our own capital or if we buy a higher growth business that was run by an entrepreneur that has lower gross margins. In their early days, we know once we can get it in our system we can raise those margins over time. We’ve experienced some of that in this past quarter with Thanasi and Frontera as an example, but you can see from our past couple of years of behavior we are somewhat obsessed with the notion of margin expansion around here and certainly margin accretive innovation is part of that game plan.

And then just one follow-up on cost savings, did you say or can you say, what is the expected savings or the normal productivity savings expected in fiscal 2018?

Yes David. We think of that specific level of detail, what I will tell you is that, the productivity programs that we discussed at Investor Day and the 3.3% of realized productivity is on track. What we’re seeing and it was really showed up in our Q4 results a bit, is the increase in inflation. So as you remember we had an assumption of 2.3% of inflation over the three-year horizon for our algorithm, and Q4 our inflation was around 2.7% and right now we are looking at that as more of the run rate for 2018. So on track with productivity, we are continuing to look even harder at opportunities there and pricing opportunities, but we are seeing more inflation, which impacts next year.

And the next question will be from Ken Goldman of JP Morgan. Please go ahead.

Hi, thanks very much. Sean you highlighted at the beginning of your talk about margin growth still being a big part of the story, but if you look at the midpoint of your EBITDA margin guidance for 2018 it’s 16.1%, regarding the 16.5% by 2020 that’s only 20 basis points of growth per year over 2019 and 2020, I realized two and this point to Andrew's point volumes aren’t helping right, but it still seems like a fairly low bar for a company that’s early in its transformation, so I guess I’m just curious why is 16.5% not a bit conservative in your long-term outlook?

Well we only gave the long term outlook just 6 or 7 months ago at our Investor Day Ken and obviously we have over delivered a little bit on the business since we gave our outlook. So we’re not in a position to change that outlook now, we are reaffirming it, we are - as I pointed out many times, our margin expansion story, we did harvest a lot of the low hanging fruit in the first couple of years, and the language I used to describe where we go from here is that we will continue to keep chipping away at it, and we will do that successfully. With respect to margins and frankly with respect to our profitability overall, I always make the point that what we focus on is the centerline of our profitability moving North over time. And the reason for that is as you know in any given quarter, in any given year there might be other dynamics that can impact gross margin, in the short-term one way or another. Last thing you want to do when you are leading a transformation like we’re leading is let those short-term dynamics take you off of your strategic game plan. So in the case of this year we've obviously got significantly more inflation in our outlook than we had last year. That will be a factor, but the good news there is that principally we always plan to price to inflation and we will look to do that again. Dave you want to add something to that?

Yes just to build on that, another dynamic Ken is that with SG&A, as I commented. We were improved $214 million for the year, right? So that exceeded our target. Some of that was some one-time benefit and some headcount-related stuff that will come back for next year. So, we accelerated that savings, so some of that savings is going to kind of come back next year in terms of some moderate increases in SG&A. So that’s just the dynamics of the timing between 2017 and going forward.

Thank you. And then from my follow-up, you were just talking about passing on some inflation. General Mills said this week that when it comes to taking price it isn't really having many problems that it is the retailers that are investing in price, but certainly taking Mills as increases, but Smucker few weeks ago sort of said the opposite, I’m just curious in your view where does ConAgra currently fall in this spectrum, have you had any more difficulty than usual taking pricing, have any of your major customers been more challenging to negotiate with, just trying to get a general sense of your view of the industry right now?

Yes Ken, I think this is a really important point and you heard in my comments earlier that it is obvious that retailers and manufacturers are like - are hungry for improved growth, and we believe that the key to that growth is innovation and we also believe that the consumers calculus on value is a lot more than price alone. And in fact now that we are in an inflationary environment as we thought we would be, we do plan to price inflation as we can and that’s what I expect we will do going forward and as we do that there are really three things I would want you to keep in mind. One is, our customers understand fully what ConAgra is doing in terms of transforming our brands and our portfolio and they are very supportive of our work to upgrade and contemporize these brands and acknowledge that consumers evaluate a lot more than price point in their value calculus. So our customers are supportive. Frankly, our customers probably historically have compressed their own margins on our businesses too much and they are happy to see our prices and our quality and innovation move north. So that’s a positive and we have, I think as good a customer relationship right now as that’s certainly we have seen since I have been here. The second thing is, as we think about pricing, in every one of our segments we have brands that offer terrific value price points. So, if we have to take price they will still be a terrific value relative to alternatives specifically because of the brand renovation work that we’ve been doing. And then the other point is, I think the point I made, which is when the environment shifts from noninflationary inflationary sometimes you see some growth gross margin volatility in the short term and that is why we focus on the centerline not sure term deviation. So, yes I think pricing to inflation will continue to be a central part of our game plan and that’s what we intend to do going forward. In fact, in some of our categories, I think some peanut butter, we’ve already done that here in the recent months.

The next question will be from David Palmer of RBC Capital Markets. Please go ahead.

Thanks. Good morning. Could you talk a little bit more about how your promotion efficiency and innovation pipelines are different as you head into fiscal 2018 than a year ago? And in particular you talk about the 3 to 5 point improvement in revenue, I am wondering how much of that is roughly bucketed between these different things, including the SKU reductions? Thanks.

Yeah David, I think if you go back a year, maybe two years, three years certainly, we have moved from being one of the most promotional companies in the food industry to now I think we are probably in the bottom two or three. So our promotional intensity has changed dramatically. We still do a lot of promotion, but it is higher quality promotion, we have better systems in place, we track and examine every single event. Obviously, we are still young at doing that, but we are getting better at that every day, and that is, importantly it is retraining the consumer to buy our products in a non-merchandized condition based on the attractiveness of the benefits they see on the shelf. And that is a critically important notion over time. But certainly that 300 to 500 basis improvement that we are counting on this year is tied heavily to us getting our new innovation into the marketplace. We will continue to weed out items that are either margin dilutive or don’t help our brands, but we hope to have net gains and that’s what we expect as we launch these new innovations so it will be clearly a net positive. Dave, do you want to add something?

Just to add one thing. Our trade productivity target of 100 million in savings through the end of 2017 were about two-thirds of the way through that. So we still expect the benefit as we move forward. We finished fiscal 2017 in the grocery business of about 80 basis points of improvement in pricing, and about 110 basis points of improvement for frozen. So that will still be part of the calculus to grow, but as Sean said, the new products launching and the volume as a big part of it as well.

And just following up on that, when it comes to promotions and the efficiency of them, there is a type of promotion efficiency you can get by having better spend on the dollar. So at some point, particularly as you get your innovation pipeline ramped up are you getting a pipeline and better insights about how you can change the constructs of you promotions such that you can better bank for the buck and better net revenue impact in fiscal 2018?

Yes, David that is a center piece of what we are doing and we have invested as we have mentioned before in a number of IT tools, post event analytic tools, trade planning and optimization tools that led us look at all kinds of events by ROI literally at the store level or vent level and it’s in the simplest notion what you do is you identify the inefficient ones, you do fewer of those, you identify the ones that are much more efficient and you do more of those and it is basically a mix concept, it is a mix improvement and it is delivering improved overall effectiveness and efficiency.

The next question will be from Jason English of Goldman Sachs. Please go ahead.

Hey guys, thank you for squeezing me in.

Hi Jason.

Hi Jason.

Congrats on a pretty solid year all around, particularly in a tough environment. Looking forward, I think you shared some color, I am afraid I missed some of the details, so I was hoping you could remind me what you said in terms of expectations for growth by segment. I thought I heard you say, international food service you are going to apply your value to volume approach there, so we should expect some weakness, but did you say that grocery and Refrigerated & Frozen could perhaps return to growth this year?

Jason you did hear me correctly. While we don’t guide at a segment level, you can gather from my comments that we are expecting meaningful improvement in our US retail businesses overall and that does reflect the upgraded volume base and robust innovation slate. So at a company level though, our sales guidance of minus 2 to flat does imply that 300 to 500 basis point improvement which while a significant trend band is something that we are confident we can deliver and something that we will ride our US Retail Business as hard in order to deliver.

Thank you for that clarification. Then one other question on the buy back, first house-keeping, how you do plan to fund it? Anything you can say in terms of cadence of how you expect to stagger at the buy back and then what if anything, does this mean in terms of you ambitions for sizeable M&A if instead you are kind of deploying a lot of capital, a lot more than we expected into share repo this year.

I’ll tell you what, Jason let me take the M&A question and then Dave you can comment a little bit on our buyback and cadence and things like that. With respect to M&A, obviously we’ve been very vocal about our belief that acquisitions will contribute be they smaller modernizing deals like Frontera or Duke’s or larger more synergistic deals, and as you know we will approach any deals we look at with strategic and financial discipline. If something fits strategically it is actionable and offers a compelling return, we will have fire power and organizational capacity to act. So if a larger synergistic opportunity came out we have the ability to push pause on our buyback program and pursue that deal and our conclusion would be that that is a better way to drive value for our shareholders in that hypothetical scenario. Dave, any specifics on the buyback?

Yes, as it relates to the buyback, if you go back to Investor Day Jason, I was very clear about, you know this is our target for buyback assuming no synergistic acquisition, so based on our balanced capital allocation approach if we were to enter in to a large synergistic acquisition that assumption could change. So that’s just important to know. In terms of the funding of it, as you saw this year, our cash flow from operations was about $1.1 billion. We anticipate that next year will be in line with that so most of it would be funded from our cash flow operations with a little increase in our debt. So, that’s generally - we don’t comment on the cadence.

The next question will be from Robert Moskow of Credit Suisse. Please go ahead.

Hi. A couple of questions on the modeling, if I could please, The share repurchase of $1.1 billion, let’s say it all got done, what do you think you would do to your net diluted share count, like how much of it is to offset options and some stuff like that? And then if I look at the range of sales guidance, you know negative 2 to 0 and then compare that to the op margin range, is the assumption here that if you were down at negative 2 that your margin would be higher because you would be working towards a specific operating income kind of number, and if so what is that operating income number look like, but by my modeling it kind of implies like of flattish year for operating income for the company? Thanks.

Yes, so good question. Obviously, we have given a range here, so there is a lot of different outcomes that we could have, just to start with your share count question, assuming we would do to pull buyback, clearly we would have more share dilution and just what we need for management compensation, so you can make an assumption on that and were the weighted average shares would be. In terms of the mix between EPS growth and where we would be from operating profit, as you look we gave a range on our operating margin for next year. And the reason for that is because when you look at the new products being launched and the investment behind that in terms of A&P, we do intend to increase our A&P and we talked about this at Investor Day kind of given where our A&P is at 4.2%, compared to some of the peer companies there is room to grow there. So, we would anticipate some investment increase in investment there, but we want to reserve the right as the year goes on and we look at the new products and the execution what those opportunities would be. So that is clearly part of the dynamic, which would obviously affect operating profit increased during the year depending on what level we would go with our A&P. From an SG&A perspective, as I mention we expect some moderate increase given the acceleration of benefit this year, but we finished this year of 10.3% and we clearly don't anticipate getting back the 10.8% that we talked about at Investor Day. So that’s the dynamic obviously from a modeling perspective, you get to look at a lot of different scenarios, but generally that’s how we think about it.

That’s helpful. I’ll pass it on. Thanks.

And the next question will be from Chris Growe of Stifel Nicolaus. Please go ahead.

Hi good morning.

Hi, Chris.

Hi. I just had two questions, I could start first with those follow-up just to understand the, you have all the innovation coming in this year, or your incremental innovation coming in, do you still have some of that tale of SKU rationalization that’s occurring as well and, just to sort of understand, is innovation back-half loaded and SKUs - rationalization more front end loaded, just to understand kind of the cadence of how sales growth improves during the year?

Yes, I think, while we don't give quarterly guidance clearly we expect the topline that we're going to deliver to build sequentially as we proceed. With respect to kind of the weeding and feeding process as I will call it, we will continue to do SKU rationalization, recall that, the final 20% of our volume historically accounted for the vast majority of our SKUs and we went a long way towards beginning to rationalize some of that last year, but some of that will continue and is certainly continuing now, but we will - we expect to offset that and grow the business through the introduction of the new higher velocity, higher margin items, and those will really flow in as we move through Q1 and in Q2 and build that distribution through the end of the calendar year. So, I can't give you the exact month-to-month kind of net-net in terms of the weeding and feeding Chris, but that’s directionally how to think about it.

And then maybe quantify that degree of the ongoing sort of SKU rationalization, is that something we should expect going forward, is there larger than usual amount this year?

I think we will - as category managers we have always got to do it and you are always going to renovate or at least you should, your brands and your portfolio, so that will be an ongoing peace, but on a going state it is nowhere near the likes of which we have done in this last year, which is really take a significant step forward. It will move into a more normalization rate as we move through this year.

The next question will be from Rob Dickerson of Deutsche Bank. Please go ahead.

Okay thank you. Sean this is just a very general question for you, any incremental color just basically on the M&A environment in general, I think would be helpful for everyone. You know it really, I feel like over the past few years we’ve seen descent consolidation obviously within the space, you know over the - I mean, really, year-to-date this year, we're seeing the incremental volume pressure within the industry where a lot of the company is kind of expecting to drive incremental growth through innovation, later in the year. They were hearing all about the pressures and with the retail landscape, we’re seeing some potential increased consolidation on the retail side. So, I was just curious when you speak to your ability, your firepower willingness to do deals, let’s say do you foresee more assets actually coming to market by giving you more options to potentially acquire or at this point, does there seem to be somewhat fine line pipeline?

Well it changes every day when you open the newspaper Rob, and certainly if there were an action ability meter out there, the newspaper reporters would have that action, it would make sound like there are more things coming to the market this year than it has been available. My attitude is, I believe it when I see it, but we are always looking and we always cast to widen that and we are very positive about the role that acquisitions can help in our value creation agenda. At the same time, it is our responsibility and shareholders to keep a level head and make sure that what we look at not only fit strategically, but that we are financially disciplined, and we have been, we will continue to be and we will continue to be on the lookout for deals that make good strategic sense and make good financial sense and hopefully there will be some increased action ability moving forward, but we are always ready should that materialize.

Okay great, I’ll pass it on.

The next question will be from Alexia Howard of Bernstein. Please go ahead.

Good morning everyone and thanks for the question.

Hi, Alexia.

Hi. Can I ask about the main drivers of margin expansion this year, it seems like that you have done a lot of heavy lifting on SKU rationalization and so on, so I'm just curious about what are the big levers there and then the follow-up question and I’m not sure you have commented on this yet, but is there likely to be any significant dilutions from the divestments of the Wesson later in the year? Thank you and I will pass it on.

Yes Alexia, I will start with the second question first. We are not going to comment at all on any numbers related to Wesson until the deal would actually close. So when that happens we will give more information on that. Regarding your first question, if you look for the year from a gross margin perspective, we were up 180 basis points and that’s just as a reminder coming off at 2016 where we were up 260 basis points. So, we have gone from 26.5% gross margins to 30.2% in two years. When you look at 2017 of the 180 basis points improvement, about 50 basis points of that was related to the divestiture of Spicetec and Swank because that is very low margin mid-teens business. In addition to that we still are hitting our realized productivity targets that we talked about at Investor Day, so we are getting great productivity from our supply chain. Inflation was relatively benign in the first half of the year, but we have seen it click up particularly in the fourth quarter as I mentioned earlier, around 2.7%, but all in all we’ve still had nice improvement in gross margin for the year despite that headwind.

The next question will be from Jonathan Feeney of Consumer Edge Research. Please go ahead.

Good morning, thanks so much for the question. I wanted to - I think last week we hit an all-time low for the BB High Yield Index, you made a comment, I think it was Mark, made a comment about - commented on investment grade rating, so question or follow-up I had, sorry, I think it was Dave rather. Too many conference calls. In your record EBITDA interest coverage this quarter and set up for that next quarter, what drives and trading the stock at the minute trading at something like 16 times what you are guiding for 2020 just on that 10% GPS CAGR, what drives that commitment and to the investment grading, what doesn't make this a kind of unprecedented opportunity to take advantage of that with the affordability that kind of low interest rate gives you and maybe event to term out? And as a follow up if the right deal were to materialize, say if one that would give you a number one market share and a category that’s important to you, would you consider being flexible on that or what’s your sense of how high debt-to-EBITDA that this company you can handle in your opinion? Thank you.

Yeah, so will take the second question first, we don’t comment on or speculate about M&A, so obviously we evaluated everything as Sean said, we cast a wide net, and then we evaluate everything based on its strategic merit and then all the financial metrics associated with it. To your first question, clearly we are seeing very attractive markets. The cost of borrowing is very low. We believe and remain committed to investment grade, because it really gives us flexibility to borrow, it keeps our borrowing cost even lower and it gives us access to the commercial paper markets, which are very important for us, very low cost of financing and gives us a lot of flexibility. So, that’s what we’ve committed to and we can continue to make that comment in this environment where we have very low rates all around.

The next question will be from Akshay Jagdale of Jefferies. Please go ahead.

Thanks for squeezing me in. I just wanted to follow up on portfolio repositioning and the capital loss carry-forward. I think you mentioned the - using 37% or 38% of it so far, can you explain the math there, because I think you have sold two businesses for a total of, I don’t know $700 million, $800 million and so I am not understanding the math of how you get to that much usage of the capital loss carry-forward, maybe I’m not understanding it and then more broadly for Sean, I mean, how do you think of value creation when you’re divesting assets? Thanks.

Akshay, let me take the first one. So our capital loss carry-forward was about $4 billion, we are down to about $2.5 billion and there were several kinds of pieces of that. The Spicetec and Swank divestitures we benefitted. There were some parts of the Lamb Weston spin where we utilized it. And then with the Wesson divestiture, even though we haven’t closed from an accounting perspective as you saw on our release, you account for that now because it is probable that you would use it. Because as you may know, even though it is an asset on our balance sheet we fully reserve for that asset and then we use it, we get the tax benefit that goes through the P&L. So, clearly we have a track of using them as we said, we’ve utilized 38% to date. So, we feel good about that progress.

And Akshay with respect to your second question, when I think about ConAgra and maximizing value I think holistically about reshaping the portfolio. And reshaping the portfolio really consists of three things: One is, strengthening the businesses we already own, and undoing a lot of legacy stuff that we’ve talked about making them stronger margin for the future. Two is adding new assets to the portfolio that fit strategically with what we do that enhance our growth profile, potentially enhance our margin profile. And third would be surgically letting go of businesses that don’t fit what we are doing strategically or are a chronic drag on our top line or a chronic drag on our margin structure or assets that somebody else values more materially than we do. So all those three things in together really comprise the recipe for how we’re going to maximize value here at ConAgra.

And ladies and gentlemen, this will conclude our question-and-answer session. I would like to hand the conference back over to Brian Kearney for his closing remarks.

Thank you. As a reminder this conference is being recorded and will be archived online as detailed in our news release. As always, we are available for discussions. Thank you for your interest in ConAgra Brands.

Thank you. Ladies and gentlemen, the conference has now concluded. Thank you for attending today’s presentation. You may now disconnect your lines.