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Operator: Hello, and welcome to Westrock Coffee Company’s First Quarter 2026 Earnings Conference Call. My name is Rory. I’ll be coordinating your call today. Following prepared remarks, we will open up the call to your questions. Instructions will be given at that time. I’ll now hand the call over to Jauan Arnold with Westrock Coffee.

Jauan Arnold: Thank you, and welcome to Westrock Coffee Company’s First Quarter 2026 Earnings Conference Call. Today’s call is being recorded. With us are Mr. Scott Ford, Co-Founder and Chief Executive Officer; and Mr. Chris Pledger, Chief Financial Officer. By now, everyone should have access to the company’s first quarter earnings release issued earlier today. This information is available on the Investor Relations section of Westrock Coffee Company’s website at investors.westrockcoffee.com. Certain comments made on this call include forward-looking statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management’s current expectations and beliefs concerning future events and are subject to several risks and uncertainties that could cause actual results to differ materially from those described in these forward-looking statements.

Please refer to today’s press release and other filings with the SEC for a more detailed discussion of the risk factors that could cause actual results to differ materially from those expressed or implied in any forward-looking statements made today. Also, discussions during the call will use some non-GAAP financial measures as we describe business performance. The SEC filings as well as the earnings press release provide reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures. And with that, it’s my pleasure to turn the call over to Scott Ford, our Co-Founder and Chief Executive Officer.

Scott Ford: Thank you, Jauan. Good afternoon, everyone. Thanks for joining us. I am pleased to report that our first quarter of ’26 delivered strong results across every dimension of our business, marking our fourth consecutive quarter of year-over-year consolidated adjusted EBITDA growth and what I believe is the most important inflection point in Westrock Coffee’s history. For the first time, we are reporting results as a fully operational integrated beverage platform with construction behind us, all lines running and the full enterprise now generating operating income. On the numbers, Q1 consolidated adjusted EBITDA was $26 million, more than tripling year-over-year. Net sales were $308.8 million, up 44%. We went from a $13 million operating loss in Q1 of last year to a $3.2 million operating profit this quarter, and our secured net leverage ratio improved to 3.45x, down 40 basis points from year-end.

Chris will take you through the details, but the trajectory speaks for itself. The real story this quarter is what’s happening commercially. The platform we spent 3 years building is now attracting exactly the kind of demand we envisioned. Brands coming to us not for a single SKU, but for a full spectrum beverage partnership across multiple categories. At Conway, all 5 production lines are fully operational, cans, glass, multi-serve bottles, and bulk extract. With capital expenditure projects now complete, Conway has swung to operating cash flow positive. As volumes continue to build through the balance of this year and next, we expect the facility to become an increasingly meaningful contributor to segment profitability. Commercially, we are continuing to make progress with current and new potential brand partners across the product portfolio from tea and lemonade-based refreshers to coffee RTD beverages to packaged coffee to single-serve cups, with energy drinks, high-protein drinks, and seltzers in various stages of product development and commercialization.

In single-serve specifically, you’ll recall the departure of a large customer in Q4 of ’25 due to industry consolidation. That disruption is now fully behind us. We are seeing strong inbound interest from multiple customers, and we expect some of this volume to begin arriving in late ’26 with full replacement targeted by the end of ’27. On Palantir, our partnership continues to deepen, and I am convinced this relationship remains underappreciated by the market. Their foundry operating system is empowering completely new ways of work. From improving efficiencies in our manufacturing, logistics, planning, procurement to the automation of workflows throughout the company, we continue to believe that the upside to this body of work is well beyond anything approaching historical normality from traditional system upgrade efforts.

We are reaffirming our ’26 consolidated adjusted EBITDA outlook of $90 million to $100 million. Q1’s 2026 beat plan and posted strong year-over-year growth. The pipeline is the healthiest by far that it’s ever been and momentum is building. To close, the prior 3 years were about building the platform. This year is about leveraging it. We’re generating operating income. We’re deleveraging our balance sheet. Conway is contributing, and we have a deep pipeline of customers who want to produce with us across an expanding array of categories. This is the business model working. I want to thank our entire team from the plant floors in Concord, Conway, Collins, and Clark, to our sourcing offices around the world to our systems and corporate teams.

These results are theirs. I also want to thank our shareholders who had the vision to invest in what we were building and the conviction to hold their shares through 3 years of heavy investment to get here. We appreciate your patience, and we intend to keep rewarding it. We are one of the very few platforms in North America that can formulate, fill, and ship across cans, glass, bottles and single-serve formats from a single integrated footprint and brand owners are increasingly coming to us precisely because of that. With that, I’ll turn it over to Chris Pledger, our CFO, for the financial details. Chris?

Thomas Pledger: Thank you, Scott, and good afternoon, everyone. As Scott noted, we just completed the first quarter in which our Conway extract and RTD facility is fully operational and contributing at scale, and the results speak for themselves. Consolidated net sales increased 44% to approximately $309 million. Our reported net loss of $8.5 million narrowed significantly from the $27.2 million net loss incurred in the first quarter of 2025, and we went from an operating loss of $13.1 million in the first quarter of last year to a $3.2 million operating profit this quarter. This improvement reflects operating leverage now visible in every line of the P&L as Conway start-up costs diminish and volume scales. And finally, consolidated adjusted EBITDA was $26 million, which reflects another record quarter for Westrock, increasing over 3x compared to consolidated adjusted EBITDA generated in the first quarter of 2025.

In Beverage Solutions, first quarter segment adjusted EBITDA was $23.3 million, up 143% versus 2025. This result includes a one-time gain of approximately $4.6 million, which represents the final payment we received under the single-serve cup contract with a customer who was acquired by a competitor earlier this year. But even excluding this item, Beverage Solutions adjusted EBITDA was approximately $18.6 million, which is up 95% versus the first quarter of 2025. Growth in Beverage Solutions was driven by the continued ramp of our RTD can, glass and multi-serve bottle production lines in Conway, a 31% increase in single-serve cup volumes across both existing and new brand partners, 4% growth in our packaged coffee business and improved fixed cost absorption across the manufacturing footprint.

Our SS&T segment delivered segment adjusted EBITDA of $6.5 million in the first quarter compared to $1.9 million in the first quarter of 2025. SS&T continues to be a strategic capability for the platform, enabling us to offer brand owners verified traceable supply at the scale modern beverage platforms require. Capital expenditures for the quarter were approximately $7 million compared to over $41 million of CapEx for the first quarter of 2025. As I mentioned on our last call, we expect a downward trajectory in the capital intensity of the business now that Conway is fully commercialized. That trajectory from $160 million in 2024 to $89 million in 2025 to an expected $30 million in 2026 represents a structural shift in the capital profile of the company.

Maintenance capital is now our baseline as our investment phase is behind us. At quarter end, we had approximately $63 million of unrestricted cash and revolver availability under our Beverage Solutions credit facility, and we remain in full compliance with our credit agreement. We ended the first quarter with Beverage Solutions net secured leverage of 3.45x, down from 3.85x at year-end, which is in line with our expectations and meaningfully ahead of our covenant requirements. And importantly, we remain on track to be free cash flow positive in the second half of this year. Our first quarter results demonstrate the earnings power of the platform as we continue to grow into the capacity we’ve built. We continue to convert our commercial pipeline at pace and the fact that capacity is now installed, and operating has materially shortened our sales cycle with new brand partners.

Our focus is squarely on commercializing the installed capacity we’ve built and converting our pipeline into long-term partnerships. With that, we’d be happy to open the line for questions.

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Operator: [Operator Instructions] Our first question comes from the line of Eric Des Lauriers of Craig-Hallum Group.

Eric Des Lauriers: Congrats on the amazing execution over the past several years and the progress, especially seen in Q1 here, a great job. So, my first question here, it seems like, I mean, pretty much everything is going in the right direction for you guys. All the comments are positive in terms of all the lines being produced. You have more volumes coming online throughout the year. So, my real question here is just kind of on the potential variability around timing of the ramp in those volumes. Is there much, if any, variability in that? Or is that all pretty much squared away and sort of spoken for at this point? Just kind of wondering the ability for things to ramp either faster or slower this year than currently anticipated.

Scott Ford: First of all, thank you for your very gracious comment. I think — Eric, this is Scott. I think that the forecast that we’ve given for ’26 and then the plans that we’re working on ’27 are for the most part at this juncture contracted in. So that doesn’t mean everything will land right when we think it will land. But our confidence that we’ll be able to make it at the margin that we expect is very high now that we’ve been running the plant and running several of these lines for 12 to 18 months. We’ve got our per unit economics right. We run those at scale. We know where those land. So, we’re actually pretty comfortable with the trajectory that we’ve got. And then we’ve got — we do have one interesting thing beyond just the contracts that are in and the conversations that we’re having.

We are seeing on the potential upside, which is — I’m not trying to sell you on that it will happen. But we are seeing a number of brands coming around and taking a look at multiple products, and we are seeing engagement to close and commitment for production in 4- to 6-month windows as opposed to 2- to 4-year windows since Conway turned on and people could actually come walk through it, have us make a sample of their product, have us tweak it, et cetera, et cetera. And then it’s something about the fact they can walk through it and see it has changed the pace at which brands are closing with us. So, I would say we’ve got some upside to that. And I think you see more of that in ’27, certainly at this point than ’26. Chris, what else would you…

Thomas Pledger: No, I think that’s exactly right. I think that in terms of what we have locked in for ’26, I think there’s some potential upside to that, but it’s largely contracted and pulling through the system as we expect. ’27, there’s the best sales pipeline that we’ve had. So, I expect to continue to be able to grow through the year, and we’ll see that in our ’27 numbers.

Eric Des Lauriers: Awesome. That’s very helpful. I appreciate that. And no real surprises there but certainly encouraging on the expedited pace of brands closing. It’s nice to hear. On to the Palantir commentary, I would say this is like this, at least from my perspective, is a bit more of like a qualitative thing for me. Certainly, nice to hear, and we’ll sort of like await more results there. It’s tough for me to sort of predict that. So, I’m wondering if you can help us understand, as we look out to ’28, ’29, et cetera, where might we see the impact of this Palantir relationship progressing? Would this be on — you mentioned procurement and operations. I mean I’m kind of just imagining improved margins overall. But is there anything else that we should sort of be on the lookout for over the next couple of years as this Palantir relationship potentially has increasing impact?

Scott Ford: Super question. Let me take a run at it this way. And I was not the first person to the party on Palantir and what they could mean for our business. That came out of another group of people here in the business that did the research on it, started working on it 3 years ago, and I have been a follower, not a leader on this. But I have — there’s nothing like a convert or spreading the word. And as a bit of a somewhat reluctant convert, if you will, the more that we dig into this, the more I realize that the — what I read and what we see talked about in the AI world and what Palantir’s operating system actually is, I can barely recognize the reality of what they’re doing on the ground with the talk that goes on around AI.

I don’t know any — so you’re talking to a guy who’s not on social media, doesn’t know anything about it, doesn’t care to know anything about it. I was full-grown when that came out. I skipped all of that. I thought AI and the chatbot and having conversations with an AI system was of the same ilk. When I see though, is the reality that Palantir creates a walled garden, if you will, where every piece of data in our network across all the systems and all of the handoffs and all of the spreadsheets and all of the memos and the hundreds of hours a week that we spend as individuals trying to explain and connect information from one system to another to another to then even be able to guess what our profitability is, let alone audit it. Palantir’s Foundry system contains all of that information and drains the need for all of those systems and all of that activity.

We’re talking tens of millions of dollars of benefit over the next 3 to 5 years annually in a business our size at only $1.3 billion run rate. I don’t think the world is even writing about the impact of — it’s a little bit like when Microsoft came out. You all are probably too young. I remember when it came out. I remember an operating system that brought about a cohesive desktop experience where you could get to a financial analysis and you could get to a word document and you could get to e-mail. That was unheard of. Well, it rebuilt the office in the enterprise — rebuilt office work across the world. I’m not so sure that the Foundry system isn’t going to rebuild in the same fashion, the commercial systems of corporations around the world over the next 10 to 15 years.

And we, I was a doubter, and I may be the biggest believer walking at this juncture.

Operator: Our next question comes from the line of Sarang Vora at Telsey Advisory Group.

Sarang Vora: Congratulations on a great quarter. My question is on the plant utilization, capacity utilization. I mean the demand is just very, very strong. The ’26 pipeline seems full. ’27, you’re already taking orders. I’m curious if you can share color on where the plant or capacity utilization is today and how it ramps up in like ’27? And is there room for ’28? I’m just curious to know like number of shifts. Any color you can share on how the plant or the capacity is being utilized?

Scott Ford: Yes. At a high level, Sarang, as we said last quarter, we are not going to break that kind of detail out. Our competitors don’t break it out. And I don’t think it behooves — it’s not going to change the story for a Westrock investor to know the percentage utilization of a specific line versus quarter-over-quarter. So, we broke that out during the construction phase so people can see where we are. I will say this: We have well in excess of an additional $100 million of EBITDA for sale in lines that we have capacity to sell against right now. So, whether that takes us 6 months, 12 months, or 18 months, then we could expand it from there with small incremental CapEx additions within the footprint that we’ve built and that we have rebuilt in the plants that we’ve got running today.

Sarang Vora: No, that’s great. That’s exactly what I was trying to ask because we do get asked about like what is the long-term potential coming out of Conway. And one way or the other, I feel like you answered the potential of that business. So that was good to hear. The second question we get a lot is on the coffee prices. And I understand the dynamics that you do end up passing the increases as well as the decreases to the customer. But can you walk us through how the lower coffee prices over ’26 and maybe ’27 kind of reflects on part of your businesses?

Thomas Pledger: Yes. Sarang, this is Chris. I think from — in ’25, I mean, ’25 was sort of, I guess, we experienced in the coffee business, historically high C price throughout ’25. That coffee still continues to flow through our P&L, although as prices have come down towards the back part of last year and into the first part of this year, we’re starting to get lower cost coffee that comes through. And that’s a passthrough for us, as we’ve talked about on prior calls. And what that ends up doing is that it will end up — your net sales will be higher because you’ve got a higher cost of coffee flowing through your P&L and your gross profit — dollar gross profit will stay the same on an apples-to-apples basis. And so, while your margins might compress, your absolute dollar growth happens on a dollar basis.

And so, when we — that’s when we talk about look at the year-over-year growth in gross profit, look at the year-over-year growth in adjusted EBITDA on a dollar basis to really see the earnings power of the business. If you look at this year, gross profit in the first quarter of this year was $46 million. That’s a 57% increase year-over-year. That’s the value of the platform that we’ve created, cutting out the noise of a C price movement year-over-year.

Sarang Vora: That’s great. And my final question is on the outlook. Can you share any puts and takes we should be mindful of? Very strong first quarter, you didn’t raise the annual. But I’m just curious to know anything that we should be mindful that you’re watching in terms of guidance, like higher gas prices. I know historically, they have impacted your business or the consumer, the lower end or the gas station consumer. So just curious to know like anything we should be mindful or watchful as we look out at the guidance for the year?

Thomas Pledger: You kind of answered your own question. I will say the first quarter was exceptionally strong, and it held up strong through all of our different — our customer segments. As you have continued high gas prices, that’s going to affect things like C-store channels and travel center customers. But the way we’re built now where we’ve grown our retail packaging, we’ve grown our at-home consumption or products targeted towards at-home consumption. We are much better positioned to withstand volatility that results from a C-store channel because of high gas prices than we were when we kind of went through this 2 to 3 years ago. And so that’s certainly something that we watch. Obviously, $6 gas is nobody’s friend when it comes to selling products, whether it’s coffee or anything else you might find in an away-from-home environment.

But we’ll continue to watch that, but we like where we are and how we’ve diversified risks around the business, and we expect to continue to be able to deliver as we have.

Operator: [Operator Instructions] I’m showing no further questions at this time. I would now like to turn the call back to Scott Ford for closing remarks.

Scott Ford: All right. Well, fellas, thanks for hopping on. We appreciate it. Super proud of the team’s effort. I’m really appreciative of the shareholder base that has stayed with us. About 70% of the shares are held by people that believed in the story of what we were doing, who were willing to put the money up to see construction go into this industry. We are excited about the fact that the construction phase is complete. I’m really appreciative of the shareholders who stayed with us. We’ve got about 30% of the float outstanding that’s short. I know that not everybody is with us on this, but that’s okay. Life works its way through. But we are looking forward to a good remaining portion of the year. And then we think ’27 is looking actually terrific because the volumes we’re booking now are starting to be placed in ’27.

And we kind of outkicked our coverage in terms of what we expected. We’re going to do some work through the back part of this year to make sure we get a good number on it. But things are going really well as we come out of construction and into filling the plants. And I just want to say thank you to everybody who has stayed with us through the thick and the thin of construction phase. And all have a great evening. Thanks so much.

Operator: Thank you for your participation in today’s conference. This does conclude the program. You may now disconnect.

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