Since becoming CEO at the beginning of 2024, Brian Kocher has leveraged SunOpta's strong fundamentals and advanced competitive positioning to drive strong growth while enhancing focus on productivity and return on capital. As a result, SunOpta has unlocked capacity in its plant network, should realize significant margin expansion in the coming years, and is deleveraging its balance sheet to create greater capital allocation flexibility. Impressively, despite an evolving macro backdrop, SunOpta continues to demonstrate the strength of its model, including recently raising its 2025 guidance. Joining Brian today is Jeff Egan, VP Finance at SunOpta. We appreciate you both being here.
Thanks a lot for having us.
Absolutely.
Man, after that introduction, is there anything else we need to cover?
I answered all the questions right there.
Maybe I would start on where I started the intro. It's been almost 18 months since you joined SunOpta as CEO. What do you see as the company's biggest achievement over that time frame? What do you kind of look back and say, "This is really the key thing that we've achieved over that time"?
If I think about it, look, I've been really proud of our organization: receptive to change, driving efficiencies, focused on continuous improvement. There are a lot of good things that our organization has been able to develop and execute against. If there are two, one is we have line of sight now. We did a capital investment, capital deployment two, three years ago, and I'm not sure we had line of sight of exactly—we knew how it turned in the revenue. I'm not sure we had line of sight on how it turned in margin. We've got clear line of sight on margin. We've been able to articulate now a clear path to the investment community of how margin expands, when it expands, and the magnitude of the expansion. We're driving operational improvements every day.
I think I even mentioned to you, Andrew, we're producing essentially 6% more units, 6.5% more units overall in the 1st quarter of 2025 than we did in the 1st quarter of '24 with substantially the same equipment. That is all capacity creation by unlocking bottlenecks. I'm really proud of the work that the organization has done there. I think the other thing that is, because that's an internally focused thing. When you're focusing on operational excellence, you're looking inside in your business. The other thing I'm really proud of is we've got a pipeline now that's 25% of our annual revenue. It's probably twice as big as when I walked in the door. We have managed to drive operational excellence, which is a very internal thing, while also growing a pipeline. I'm proud of those two.
I know you only asked for one, but I had to slip in an extra one.
More the better.
You talked a little bit about visibility. It was more related to margins than it was top line, but visibility in general. I find that your stock is much more sensitive to the perceptions about consumer spending than your actual business is. Even to that point, then the categories are, generally speaking. What is it that supports that durability for both your business and the sales trends, also the key categories where you participate?
Yeah, I think it's hard for the investment community to find that metric that correlates very quickly. Same-store sales, not really. Certainly, track channel retail data for plant-based beverages, that's less than a fifth of the overall category we serve and address. That doesn't track well. What we've tried to do is continue to provide exposure to, A, our volume growth. Our revenue growth, certainly this year and last year, but for the last three years, substantially has been all volume-based. That's been really important to us. Also, I think if I break it down simply, we're participating in great categories. Plant-based beverage growing in the high single digits this year. Ready-to-drink protein shakes, fruit snacks, plus 20%, better for you, fruit snacks. Even broth and tea are growing in the mid-single digits. I mean, heck, we didn't invent broth yesterday, and that's still growing.
I'm really excited about the categories. And why? For two reasons. One, the purchase decisions and the usage intentions are not dependent upon economics. These are people, for the most part, who are engaging in the category because of medicinal needs, health choices, lifestyle choices, taste preferences. And oh, by the way, we're significantly over-indexed in penetration to the younger generations. Those are habit-forming. If I just look in my own household, there's just—my kids don't drink dairy milk. They're not going to drink dairy milk. Their kids are not going to drink dairy milk. I think there's some of those long, enduring purchase intention decisions and usage occasions that really support the category. The other thing I would tell you is we can access the shopper. That was purchase intention. If I look at shopper behavior, we can access the shopper everywhere.
Remember, we're a private label and co-manufacturing solutions provider. The brands that we support, they're in premium food service, they're in QSR, they're in retail, they're in club. We can kind of engage with the shopper no matter where they're making their buy decisions.
Given that there is no catch-all metric that helps us perfectly correlate to your top line, can you talk about what you're seeing at food service and retail? Is there anything? It did sound like through the 1st quarter, generally, not for your business, but across industries, we saw some slowdown. If you peel back the onion, is there anything kind of underneath that we don't see in your volume trends that's showing changing behaviors?
I think it's probably too early for me to make a conclusion that, hey, this is a trend that we see. Although I would tell you our club channel business grew double digits in the 1st quarter. Food service still grew in the mid-single digits. We're seeing growth, but club is growing a little bit more quickly than certainly our food service business. Maybe that's an early indication of consumers searching for value. I do think it's interesting. Again, when you're making decisions based upon medicinal needs, animal welfare, environmental, taste, healthy lifestyle, these aren't considered then luxury items for the people that are engaging in the categories.
Even if you think your drive-thru latte on a Tuesday morning is a small luxury, it's a luxury you can afford, and we're not asking you to take that decision over buying a new washer and dryer or a car or a vacation. You can do it. You can do it. In an interesting way, we've seen our outlook for the next balance of the year actually firm up as opposed to become more unknown. As a result, we were able to increase the low end of our guidance on revenue growth.
Yep. You also mentioned the pipeline, which has built very nicely by what you said. Can you kind of put it in context how it's evolved over the last several quarters and how that typically—talk about how that typically converts over to sales?
Yeah, I would love our pipeline to be on like an Excel schedule that says, "Go to line X and then over to row T," and there you have it. It is a lot of work in terms of engaging with the customer on their needs. I am really pretty simple. If I can solve a customer's problem, we win. At the end of the day, we win. Listen first, do not talk. Listen first. Understand the customer's challenges. Tailor our solution to meet that challenge. What we are finding is that we are really darn good at that. We are good at R&D and innovation. If you have a taste profile, a nutritional content issue, you want lower sugar, you want more protein, you want it to taste like cinnamon brown sugar, hey, we can do all that. That is a solution set. Sometimes it is more basic than that.
Sometimes we need to be able to support the promotional schedule. We need to support the supply chain. We need to hold on to a little inventory when they need more. We need to allow them to thin out their inventory. We are providing a supply chain solution. I think that helps build the pipeline because customers know the route to our success is their success. It is a good relationship. Our usual sales cycle is kind of, depending on what it could be, it might be 6-18 months. That pipeline is spread all amongst those. To give you a little flavor, I do think our pipeline is a little bit more tilted to expansion with existing customers than new customers, but there is both. It is definitely a little bit more tilted to plant-based beverages. Our healthy snacks business is growing like crazy.
I mean, we're now running 19 consecutive quarters with double-digit growth. I think five years ago, it was 10% of our overall business. Now it's close to 20%, and we've been growing. You can see that. Healthy fruit snacks, better for you, fruit snacks are next. Broth is actually a close second to fruit snacks. We've got a diverse pipeline in there too. Hopefully that gives you a little color.
Yeah, that was great. When I hear you talk about the strength of the demand and see the results that you've put up over the last several years, it makes me wonder if other folks want a piece of the action. Are you seeing more competition? Are you seeing others try to expand capacity to capture some of this growth, which, I mean, you're talking about longer-term tailwinds too. It would seem like that would make sense. Are you seeing that? Why or why not?
You know, we've actually seen—let me—sorry. I still think we're in a capital-constrained, capacity-constrained environment. We saw a couple of big projects. One big project get sort of scuttled a year, year and a half ago. We saw another competitor who struggled and actually went out of business. We see growth in the category. I would say now, versus 18 months ago, the capacity might be a little bit constrained, more constrained. I would also say we have the route to the cheapest capacity available. That's by creating it in our own network. That's why we're so focused on operational efficiency. For those of you in the audience, it might be as simple as scheduling. It could be a focus on equipment reliability.
It could be a focus on ensuring that you've got the right leadership on nights and weekends so that you're maintaining your production velocities throughout the 24-hour period. We've got the cheapest access to capacity. Now, eventually, we'll need some CapEx to continue growing at the clip that we're doing. Think of that more in terms of adding a production line as opposed to a greenfield plan or some order of magnitude investment that would set us back down the path of trying to recoup margin again.
When I think about your expectations, 9-11% revenue growth this year, 8-10% kind of following two years, how do I think about the building blocks of that? And how much visibility at this point in the year do you have to both this year and maybe next year as well?
Yeah, let me start off just to ground us on one thing. We made a commitment. Jeff and I, Greg Gaba, our CFO, we made a commitment when I came in the door. We were going to talk about what we see, not what we hope that happens. Now, we're going to work like hell on all the things we hope happen, but we're going to talk about what we can see. In the context of 9-11% growth in 2025 and approximately 10%, 8-10 long-term, we've got what I would say visibility to that. We're talking to our customers 12, 15, 18 months out anyway. I do not want to give you the—they're not firm purchase orders, but we need to understand what's your promotional calendar? What's your inventory position? How are you thinking about menu changes if you're in food service?
Assortment changes if you're in retail? We are talking about that a little bit longer out. I would say, again, we can put those numbers out with the comfort that we communicate what we see and not what we hope.
When I think about kind of long-range growth expectations, and you talked about expecting growth in the category, and I'm thinking about plant-based in particular, where are we in that adoption curve? We've gone from soy to almond to oat. How do you think about household penetration rates, where that could eventually get to? Can you kind of frame that up for us?
I think penetration rate is somewhere in like 60-62%, something like that. We still have room. If we look at it, though, it's absolutely over-indexed to the younger generation. As they age and as they then have children, this is another reason why I think there's long-term tailwinds. I also think the focus on health, wellness, the emergence of protein as the building block of nutrition and fitness, again, we're in ready-to-drink protein shakes, partly because we can provide a solution for a very good customer, also because we see long-term growth there. I think it's a combination of all of those things that help drive the plant-based beverage outlook for multiple years. One thing I know for sure, though, we love the diversity of our portfolio. We love the fact that it's almond, oat, soy, coconut. I don't want to say I don't care.
Of course, I care. To a certain extent, I can become indifferent. As the consumer migrates for different usage occasions, we can service all of those bases. That is one thing that I really feel we have got a strength. We have tried to talk about that a little bit more in some of our last couple of earnings calls. The diversity of our revenue stream is really helpful as we think about long-term growth. Diversity amongst bases, let's call them, product bases. Also, then diversity in products. Again, broth playing a significant role for us. Also, the diversity in channels. Premium food service all the way through to QSR, retail, not only traditional grocery, but club. We can access the buyer wherever they are making their buy decisions. I think those two pieces of diversity also give us confidence in our long-term growth outlook.
I don't want to be flippant, but it's also not bad when you've got a pipeline that's 25% of your annual revenue. That gives me a little confidence too.
Sure. You referenced the capacity unlocks that you've achieved so far. How exactly have you been going about driving that? Where do you think you are in the process? How much more room is there to go with those efforts?
Let me give you kind of two data points to address the second part of the question first. How much do we think we can do? We talked in our 4th quarter earnings call that over the course of '25 and through the balance of '26, by the end of '26, we thought we could create 20% more additional unit capacity out of our existing network. So a 20% increase in units produced. We also then came out this quarter and said, "We're actually a little bit ahead of our capacity creation trajectory." We feel very confident that already in 2025, we've created enough capacity to service the midpoint of our revenue guidance would be about 10% for '25. You can kind of see 20% between now and the end of '26, we think we've got 10 of it for '25. How we do it?
We could spend hours talking about that. I wish it was something that was really, really glamorous, but it's not. It's just hardcore manufacturing nuts and bolts. Is your raw product in on time? If it's in on time, is it the right dosage? If the batch is right, have you processed it at the right timing? Is the right timing synchronized to how you fill? Is your downline operations ready? We have been working on equipment reliability because if you think about it, on your manufacturing line, you have several pieces of equipment that go together. It would be way too easy if they all had the same preventive maintenance schedule. They do not. How do you harmonize preventive maintenance so you keep the uptime, but you have concentrated the PM windows? I think those are all things that we are doing basically every day.
When you multiply that over seven plants across North America that are operating 24/7, you kind of understand how it takes some time to continue to remove bottlenecks, increase flow rates, and then ultimately produce great solutions for your customers that enable growth.
Sure. You mentioned the track record of the fruit snacks growth, which is tremendous. It does not get probably enough attention from the investment community, I would argue. How big is that business today? How should we think about kind of the growth contributions on a go-forward basis to some of the growth rates that you have provided? Maybe where do you see that business going over time as a percentage of your mix?
We love that business. Again, 19 consecutive quarters with double-digit growth. If we look at the category, and Nielsen publishes a fruit snack category data, which is everything together, we're actually a better-for-you subsegment. If you look at a better-for-you subsegment, that's growing at 20% plus. Our pipeline is really big in fruit snacks. It's the second largest component of our overall pipeline. The operational efficiencies that we typically talk about in driving in our aseptic network, we're driving in our hot extrusion fruit snack supply chain as well. I'm really excited. We probably don't talk about it enough. If I remember, Jeff, four or five years ago was like 10% of our business. Now it's, "I'm going to round the 20.
He'll say it's 20.
He'll say, "No, it's not 20." Let's call it round to 20% of our business in a business that's grown 11% overall. You can see kind of the component of growth that fruit snacks play. Again, no artificial colors, no artificial flavors. The sugar comes from apple juice and apple puree. It's a natural, simple sugar. We love that category, and we continue to have the growth behind it.
The one real hiccup maybe that we could talk about has been the wastewater issue at the Midlothian facility. Can you just describe exactly what that is and what the solve is, the remediation efforts behind it?
I'd say we're facing a headwind in Midlothian. And for those of you who aren't as familiar, that's our newest operating plant. Went into production middle of '23-ish, middle of '23. We're making great progress on unit output. We're making really good progress on direct labor efficiencies. Across our network, we've got some opportunities to improve yield, raw product yield. But particularly in Midlothian, we started the project, and we had a regulatory wastewater limit of X. And after we started the wastewater or the project, our regulatory limit, our discharge limit was reduced by the local municipalities. Now, that's not the only reason. I mean, we probably made a mistake and built a sub-scale wastewater processing center. So I'm not blaming the municipality in total. But the fact of the matter is we have to deal with it.
That is probably, think of it as limiting the speed in which we can run our plant. We do not want processing to generate wastewater that is in excess of the capacity we have to process and discharge the wastewater. We slow down the plant a little bit to do it. We have a capital solution. Plans are designed. Engineers have already designed it. Purchase orders are in place, but it takes a long lead time. We see a solution coming in place in mid-2026. It is a capital solution that is already included in our maintenance and productivity CapEx guidance. It is already included in there, so non-incremental. When that gets implemented and we can now run Midlothian at the rate that we know we can, we probably see a 50 basis point annual increase in gross margin across the entire network.
That gives you an idea of the size and scope of at least this temporary headwind we're facing until we solve that issue.
Does it become a sales limiter at some point, or you'll have it resolved before that's the issue?
I think right now we're doing a nice job of balancing all the different, that's one of the reasons we have that diamond-shaped manufacturing network on our aseptic facilities. It really does give us some resiliency and redundancy. We're keeping up with the sales growth. I don't want to apologize for 9-11% sales growth either in this environment. We're keeping up with the sales growth, but it will unlock more capacity for sure and more margin.
One of the, I don't want to say one of the reasons, but one of the things that the Midlothian facility has enabled is the entry into the protein shake market. How has that gone relative to your expectation? Kind of what are the growth plans in that category over the medium to longer term?
We love that category. If you look at ready-to-drink protein shakes, if you look at nutritional beverages, even going further, Andrew, and looking at sort of the single serve, that line has 330 mL capacity. If you look at single serve and water moving to Tetra Pak or I saw a coconut drink here, those are all things that we could process now. We love the equipment, but we really love that ready-to-drink protein shake category. Consumption continues to grow at 25% plus the last time I saw the figures. We think it's got a long run. We love the customer relationship we have. I think for sure, as ultimately we think about capital expansion, again, we do not envision that for 2025 and think we probably have the network available to fuel '26 revenue too.
As we think about capital expansion, certainly we'd think about the RTD shake business as an area to allocate some future CapEx.
You may have just touched on this, but that was one element of kind of the TAM expansion pillar of your growth strategy. What are the other kind of natural adjacencies or other interesting kind of TAM expanders that you have your eye on long-term?
Yeah, I think it's really interesting. The aseptic processing equipment that we have is very versatile. Right now we're doing plant-based beverages, ready-to-drink protein shakes, broths, and tea. We can do all of that with our existing equipment. We could also do water. We could also do coffee. We could also, I mean, if we wanted, I guess we could do alcohol. I'm not sure that's on the horizon. I'm just suggesting the equipment is very versatile. Those are some of the adjacent spaces. I would not overlook, though, our pipeline right now, as I mentioned, is a little bit more tilted to plant-based beverage. Flavor profiles, nutritional content, protein infused, all of those are options for TAM expansion as we work to our customers, work with our customers. Again, our top 15 customers make up 90% of our revenue.
Roughly, yeah.
Roughly 90% of our revenue. With those 15, we're either their co-development or their R&D engine for their brand or their private label item. We feel really good about our visibility into what consumer trends are coming, how we may help our customers and our brands meet those needs.
If I think about the recent evolution and the go-forward path on your gross margins, the gross margins have been down year over year three of the last four quarters, 170 basis points here in the 1st quarter. Your '25 guidance calls for 60 basis points of gross margin expansion this year. What is driving that inflection? How do you expect kind of the cadence of that margin expansion to evolve over the course of the year?
Yeah, I'll take that one, Andrew. Thanks. The decline in gross margins recently, as you know, we've been coming out of a significant investment period, not only CapEx, but also operational efficiencies. In 2024, that was a main focus. It is still a focus that we're investing in. That kind of explains the rough decline that you mentioned. Going forward from Q1 to Q4 of 2025, 300 basis point increase expansion is what we've called for. Really, that goes into three buckets. The 20% volume increase that Brian mentioned on existing assets between 2025 and 2026, that's fixed cost leverage. Same assets, additional units. We expect that to contribute roughly 150 basis points between Q1 and Q4. The second bucket is manufacturing yield. We're producing the units. However, we're using a lot more raw materials than we would have expected.
We have multiple work streams on this, anywhere from batching to processing to packaging. We have line of sight to how to make those improvements, and we expect those efforts to yield about 100 basis points of improvement from Q1 to Q4. The final bucket is training, training of our employees. So productivity, essentially. We have, as Brian mentioned, seven plants, four shifts. They're out running 24/7. It is a process to get through everyone, get everyone on board using the same processes. These three efforts will lead to the 300 basis point increase. As far as sequencing, it's not going to be a day one boom. We expect sequential improvement throughout the year as these efforts yield the results.
I would say we'd add on Midlothian, which again, we talked about as a headwind, but what you'd start to see is the margin expansion as we resolve our wastewater headwind in the mid-2026 range.
I mean, the way you lay that out, it sounds like you've got a pretty clear roadmap on the margin expansion. How do you think about the biggest risks associated with achieving kind of a 300 basis point increase over the next several years?
Yeah, yeah. Going from 2025 to 2027, those three efforts in addition to 50 basis points roughly of resolving the Midlothian wastewater situation, we feel very good about it. Any risks I could point to would probably be more macro or regulatory or legal that sometimes those can throw curveballs our way. We've dealt with certain ones such as tariffs. However, that could pose a challenge that we'd have to resolve.
So.
Oh, go ahead.
If we talk about confidence level, we know we have unlocked capacity to fulfill our midpoint of our revenue guidance in 2025. I feel very confident about the fixed cost leverage following through. We also know the R&D plans that we have calculated in the lab. We are testing in our plants now, and then we will expand nationwide for the raw product yield enhancements. We know the design on Midlothian. I mean, we are already ordering equipment. We expect that the engineers have done their work. We are just waiting for people to fabricate. If I could weld, I would go out and do it. We feel very confident in those. Training is always a more difficult one, right? You are dealing with people, as Jeff said. First of all, you have to get through that many shifts in that many plants. Second of all, again, we have good employee retention rates.
We're really proud of that. At the same time, no matter what, a manufacturing employee turnover rate is a little bit higher than an office environment. Employee retention and turnover, sometimes that's the one that I would say we know what we want to accomplish, but that might have a little bit of variability in it. We're very confident in the other three. By the way, you told me there was going to be no fact-checking. I object to that question. We just have to keep you honest.
All right.
You mentioned tariffs. On the earnings call, it sounded like that's not going to be a material impact based on your expectations, at least in the near term. What is the exposure, and how are you managing that?
Yeah, yeah, I can address that one. Just to set the stage, six of our seven manufacturing plants are located in the U.S. 98% of our revenue is U.S.-based. We do source some of our raw materials and packaging globally. At the facility in Canada, we do import those fruit snacks into the U.S. It accounts for less than 8% of our revenue. That kind of sets a stage as to how we're positioned. To address the tariffs, we started conversations in January with our customers. We already have a process in place to pass through costs. Think of it, raw materials. I'll use oat as an example. If the price of oat goes up, we pass that to the customers. If it goes down, we also pass that to the customers.
In January, we communicated our intention. Tariffs will be treated the exact same way as raw material passed through. We have had those conversations. We started in January, and we feel really good in our ability to pass through substantially all the costs of tariffs.
That is built into the agreements, whether it is co-man or privately, all the different exposures and contract structures.
For the most part.
Yeah.
Yeah.
Yeah. Okay. Okay. Now, I don't think any of us envision tariffs as being the big reason that we'd be passing through those costs. I think the point is we have these conversations on a quarterly basis for the last several years.
Okay.
The company made kind of a pivot to focus more on ROIC recently. What was the driver behind that kind of shift in focus, and why did you guys feel that that was important to emphasize?
I think there were a couple of reasons. First of all, I really believe if we keep our mission simple, it's better understood by the employee base. It's better understood by the decision-makers. We are trying to keep our mission simple. Grow revenue, make money, spend money wisely. All right. If that's what you want to accomplish, then I want to make sure that our incentive metrics are tied to the same thing. Revenue growth is an incentive metric. EBITDA on an annual basis is an incentive metric. Now ROIC is an incentive metric for management. If you want to accomplish three things, you have to measure and reward people in those three things. I think that's one part of it.
The other one that I think is really important, we believe the best path to long-term value creation is revenue growth, particularly volume growth, that translates into increased cash flow. Doing it, we're going to need some capital. Remember, some marketers' asset-light solution is our service. We're going to need some capital to continue the growth, not now. Even when we need that capital, we tried to dimensionalize that for people by saying we're still going to be able to do that and keep a return on invested capital somewhere in the 16-18% range.
Okay, so you've been unlocking capacity. You've got more room in Midlothian once you get that remediated. How do you think about the next, kind of the timeline on the next capital decision, the next capacity decision that you'll need to make, and where in the portfolio is that?
We're really comfortable that we can fulfill our midpoint revenue guidance in 2026 with the existing assets we have. We probably need some capital to hit our 2027 revenue if you extrapolate out an 8-10% long-term revenue growth. I would also contextualize that. Think about adding lines to existing manufacturing facilities, not building a greenfield plant, not starting over from scratch somewhere, but think about it as adding lines. A, it's more efficient in terms of cost. B, if we're already on the path of margin expansion and operational excellence, in my mind, that de-risks your next capital investment, your next line, because we're already good at it. I think those are areas that will be helpful. Think about it in terms of supporting the full 2027 revenue growth. I would expect in the last half of 2026.
Now, if demand continues to grow faster than what we expect and a customer is, I can't beat them off anymore, we talked about fruit lines, fruit snacks being a great place. We talked about ready-to-drink protein shakes growing. We have also talked about our plant-based pipeline, our pipeline sort of shifting to plant-based beverages or tilting towards that. Clearly, those would be three areas that we would evaluate when the time comes.
Less capital intensity. You've delivered the balance sheet almost at the target leverage. The board just authorized a share repurchase authorization here recently. How is the flexibility and the capital allocation kind of decision-making evolving as all those things are playing out?
Yeah, I can take that one. So our capital allocation priorities, just to remind everyone, number one is to delever to 2.5 times EBITDA by the end of 2025 is when we expect to get there. Number two is investing CapEx to support our long-term algorithm. And number three is return capital shareholders via a share buyback likely. To answer your question, if the first item and the second item, if we're on track with those to support our long-term growth algorithm and delever to 2.5 times and there's excess free cash flow, that cash flow would be applied to share buybacks. If we are on track to hit it and we are invested to support our long-term growth algorithm, that excess cash would definitely go towards share buybacks.
I think there's a little subtlety there. If you go one, two, three, delever, growth CapEx, return capital to shareholders. Number 2, we really don't envision needing right now. That's why it allows an opportunity for number 3 to be real in 2025, if you think of it that way.
Does M&A ever enter the picture for you guys? I don't know, either from a capacity perspective or a geographic perspective. Is that something that is ever in the consideration set?
It's always in the consideration side. I think we will be rewarded in the long run if we can demonstrate continued revenue growth, margin expansion, and then sequence potentially M&A to accelerate growth or potentially access markets that we don't today. I love our co-manufacturing and solutions provider philosophy. I don't really want to be a branded player that all of a sudden competes against all of our existing customers. That type of channel conflict, I think, is really hard to manage. I love geographic expansion. I think if there were capabilities or capacity expansion that we thought was a differentiated or better return on invested capital because we still have to hit our ROIC goals, which is why I love that metric for management. That could be an opportunity. I want Jeff and Greg and I worried about that.
The rest of our entire organization, I want them worried about make more product and sell more product and charge more for it.
Did I leave anything out?
I don't think so.
No?
Yeah. Are we good on time, or is there a question from the audience we can answer?
No questions on the iPad, so I think we'll end it there.
Great.
Thank you very much.
Thanks again for having us.
Absolutely.
Really appreciate it.