Advertising investments increased by 27% to $44 million in the second quarter. This indicates a strategic focus on brand building and market share gains.

International segment profit increased 70.7%, resulting from favorable costs in China and growth from partnerships in the Philippines, South Korea, and Indonesia, as well as growth in Brazil. This indicates successful expansion and strategic partnerships.

The company continues to modernize and transform initiatives. Adjusted earnings before income taxes, excluding the impact of expenses related to the Company's transform and modernize initiative and pork antitrust litigation settlements, decreased 4 percent.

Selling, general, and administrative (SG&A) expenses increased by 25.5% to $266.7 million. This increase was due to higher employee-related and external expenses, driven in part by the Company's transform and modernize initiative as well as the impact from pork antitrust litigation settlements.

In the second quarter of fiscal 2024, the Company agreed to settle with three classes of plaintiffs in the pork antitrust litigation. The settlement amounts were recorded in Selling, General, and Administrative in the Consolidated Statements of Operations and as an Accrued Expense on the Consolidated Condensed Statements of Financial Position.

Foodservice segment profit increased primarily due to higher sales and lower logistics expenses. This indicates successful management of operational costs in this segment.

The Company is subject to risks associated with the outbreak of disease in pork and beef livestock, and poultry flocks, including African swine fever (ASF), Bovine Spongiform Encephalopathy (BSE), pneumo-virus, Porcine Circovirus 2 (PCV2), Porcine Reproduction & Respiratory Syndrome (PRRS), Foot-and-Mouth Disease (FMD), Porcine Epidemic Diarrhea Virus (PEDv), and Highly Pathogenic Avian Influenza (HPAI).

Union contracts at two of the Company's manufacturing facilities, covering approximately 250 employees, expire during fiscal 2024. A significant increase in labor costs or a deterioration of labor relations at any of the Company's facilities or co-manufacturing facilities resulting in work slowdowns or stoppages could harm the Company's financial results.

The impact of HPAI has reduced and will continue to reduce production volume in the Company's turkey facilities throughout fiscal 2024. The Company is continuing to monitor the situation and will take appropriate actions to protect the health of the turkeys across the supply chain.

For the second quarter of fiscal 2024, volume growth from the bacon and emerging brands verticals was more than offset by declines in value-added meats. Net sales increased for many items, including Hormel® Black Label® bacon, the SPAM® family of products, Applegate® natural and organic meats, Hormel® Square Table™™ entrees, and Planters® snack nuts. These gains were negated by a significant year-over-year volume and pricing decline for whole bird turkeys.

Volume and net sales growth in the second quarter of fiscal 2024 were driven primarily by strength across the bacon, premium prepared proteins and turkey categories. Products such as Hormel® Bacon 1™™ cooked bacon, Hormel® Fire Braised™™ meats, Austin Blues® smoked meats, Café H® globally inspired proteins and Corn Nuts® corn kernels each delivered double-digit net sales growth.

Segment profit in the second quarter increased significantly, resulting from favorable costs in China, growth from our partnerships in the Philippines, South Korea, and Indonesia, as well as growth in Brazil.

All segments benefited from lower logistics expenses on a volume basis. Logistics expenses declined due to lower industry-wide freight rates and savings realized as part of the Company's transform and modernize initiative.

The Company expects its transform and modernize initiative to deliver cost savings throughout fiscal 2024, targeting packaging, logistics, and production costs.

Advertising investments in the second quarter were $44 million, an increase of 27 percent compared to last year, indicating a shift in resource allocation towards marketing and brand promotion.

Capital expenditures supporting growth opportunities in fiscal 2024 are expected to focus on projects related to value-added capacity, infrastructure, and new technology. Capital expenditures for fiscal 2024 are estimated to be $280 million.

The company continues to modernize and transform initiatives. Adjusted earnings before income taxes, excluding the impact of expenses related to the Company's transform and modernize initiative and pork antitrust litigation settlements, decreased 4 percent.

The largest spend during fiscal 2024 was for the transition from harvest to value-added capacity at the facility in Barron, Wisconsin and wastewater infrastructure to support operations in Austin, Minnesota.

On March 8, 2024, the Company issued senior notes in an aggregate principal amount of $500.0 million due March 2027. The proceeds were placed in a short-term bank deposit and will be used to pay the $950 million notes due June 2024 upon maturity.

Cash dividends paid to the Company's shareholders were $305 million during the first six months of fiscal 2024, compared to $293 million in the comparable period of fiscal 2023. The annual dividend rate for fiscal 2024 increased to $1.13 per share.

There were no share repurchases during the first six months of fiscal 2024. The Company continues to evaluate share repurchases as part of its capital allocation strategy.

The 10-Q filing does not contain any specific disclosures related to environmental, social, or governance (ESG) initiatives or performance metrics.

The Company's debt and credit agreements contain customary terms and conditions including representations, warranties, and covenants. The Company was in compliance with all covenants and expects to maintain compliance in the future.

In the second quarter of fiscal 2024, the Company agreed to settle with three classes of plaintiffs in the pork antitrust litigation. The settlement amounts were recorded in Selling, General, and Administrative in the Consolidated Statements of Operations and as an Accrued Expense on the Consolidated Condensed Statements of Financial Position.

Costs are expected to continue to moderate relative to the high levels of inflation the business has absorbed since the beginning of fiscal 2021. Raw material input costs for pork, beef, and feed are anticipated to remain volatile and above historical levels.

The Company's balanced business model, with diversification across raw material inputs, channels, and categories, provides stability in ever-changing economic environments.

The Company is subject to risks associated with the outbreak of disease in pork and beef livestock, and poultry flocks, including African swine fever (ASF), Bovine Spongiform Encephalopathy (BSE), pneumo-virus, Porcine Circovirus 2 (PCV2), Porcine Reproduction & Respiratory Syndrome (PRRS), Foot-and-Mouth Disease (FMD), Porcine Epidemic Diarrhea Virus (PEDv), and Highly Pathogenic Avian Influenza (HPAI).