The Marzetti's Business Segments

The company operates in the food industry, producing and selling products such as soybean oil, packaging materials, flour, sweeteners, dairy-related products, and eggs. Its business performance is influenced by consumer perceptions of product safety, quality, and dietary attributes. The company faces risks related to health and food safety, including potential product recalls, safety claims, and negative publicity, which may result in lost sales, increased costs, and damage to brand reputation. Operational risks include fluctuations in raw material, packaging, and freight costs driven by inflation, geopolitical events, or supply chain disruptions. The company sources most raw materials on the open market and uses fixed-price contracts to mitigate price volatility, though this approach does not guarantee success. Production may be disrupted by natural disasters, pandemics, or other uncontrollable events, affecting manufacturing and distribution capabilities. Economic factors such as inflation and consumer spending patterns can influence demand and pricing strategies, with possible pressure from retail partners to reverse price increases. Geopolitical instability and changes in global commodity flows may further impact supply chains and costs. The company depends on certain single manufacturing sites and third-party manufacturers, making it vulnerable to production disruptions that could affect product availability and customer relationships.

The registrant reports financial results through two segments: Retail and Foodservice. Direct costs are charged to the respective segment, while indirect costs are allocated consistently. The Retail segment manufactures and sells products under brand names such as New York Bakery TM, Sister Schubert’s ®, Marzetti ®, Marzetti Simply TM, Cardini’s ®, Girard’s ®, Chatham Village ®, and licensed brands including Chick-fil-A ®, Olive Garden ®, Buffalo Wild Wings ®, Texas Roadhouse ®, and Subway ®. Product offerings include frozen breads, refrigerated dressings and dips, shelf-stable dressings and croutons, and private label products. Retail sales are conducted primarily through sales personnel, food brokers, and distributors in the U.S., with products placed in grocery store shelf-stable sections, frozen food sections, and produce departments. The top five Retail customers accounted for 62%, 59%, and 59% of segment net sales in 2025, 2024, and 2023, respectively. Growth strategies focus on leveraging retail brands, innovation, geographic and channel expansion, exclusive licensing agreements, and strategic acquisitions. Retail sales exhibit seasonal fluctuations, particularly in the second fiscal quarter and around Easter, impacting certain frozen products and fruit dips. The registrant holds various intellectual property rights, including patents, copyrights, and formulas.