Seneca Foods Corp (SENEA) Business

Seneca Foods Corporation (“Seneca” or the “Company”) was founded in 1949 and has evolved through internal growth and strategic acquisitions into a leading provider of packaged fruits and vegetables, with 27 main facilities located throughout the United States. The facilities are comprised of plants for packaging, can manufacturing, seed production, a farming operation and a logistical support network. Food packaging operations are primarily supported by plant locations in New York, Michigan, Oregon, Wisconsin, Washington, Idaho, Illinois, Minnesota, and Arizona. The Company also maintains warehouses which are generally located adjacent to its packaging plants. The Company is incorporated in New York with its headquarters located at 350 WillowBrook Office Park, Fairport, New York 14450 and its telephone number is (585) 495-4100.

The Company’s business strategies are designed to grow its market share and enhance sales and margins. These strategies include: 1) expand the Company’s leadership in the packaged fruit and vegetable industry; 2) provide low-cost, high-quality fruit and vegetable products to consumers through the elimination of costs from the Company’s supply chain and investment in state-of-the-art production and logistical technology; 3) invest in growth opportunities; and 4) pursue strategic acquisitions that leverage the Company’s core competencies.

The Company’s Internet address is www.senecafoods.com. The Company’s annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, are available on the Company’s website, as soon as reasonably practicable after they are electronically filed with or furnished to the SEC. All such filings on the Company’s website are available free of charge. Information on our website is not part of the annual report on Form 10-K.

In addition, the Company's website includes items related to corporate governance matters, including charters of various committees of the Board of Directors and the Company's Code of Business Conduct and Ethics. The Company intends to disclose on its website any amendment to or waiver of any provision of the Code of Business Conduct and Ethics that would otherwise be required to be disclosed under the rules of the SEC and NASDAQ.

The Company manages its business almost entirely on the basis of two reportable food packaging segments: Vegetable and Fruit/Snack. The Other category comprises non-food operations including revenue derived from the sale of cans, ends, seed, and outside revenue from the Company's aircraft operations, and certain corporate items. During fiscal 2026, the Company acquired the Green Giant U.S. frozen business which is part of the vegetable reportable segment. This acquisition enhances the Company’s existing frozen capabilities and expands its reach in the frozen category. Refer to the information set forth under the heading “Acquisition” in Note 16 of the Notes to Consolidated Financial Statements in Part II, Item 8, “Financial Statements and Supplementary Data”, for additional details.

The Company’s food operations constituted 98% of total net sales in fiscal year 2026. Canned vegetables represented 82%, frozen vegetables represented 9%, fruit products represented 6%, and snack products represented 1% of the total food packaging net sales. Non-food packaging sales represented 2% of the Company's fiscal year 2026 net sales. Refer to the information set forth under the heading “Segment Information” in Note 13 of the Notes to Consolidated Financial Statements in Part II, Item 8, “Financial Statements and Supplementary Data”, for additional discussion about the Company’s segments.

The Company’s principal product offerings include canned, frozen and jarred fruits and vegetables, as well as packaged snack chips. The Company manufactures and sells the following:

● private label products are sold nationwide by major grocery outlets, such as supermarkets, mass merchandisers, limited assortment stores, club stores and dollar stores, for resale under the retailers’ own or controlled labels; ● private label and branded products to the foodservice industry, including foodservice distributors and national restaurant operators, in addition to products sold to federal, state and local governments for school and other food programs; ● branded products under national and regional brands that the Company owns or licenses, including Aunt Nellie’s®, CherryMan®, Green Giant®, Green Valley®, Libby’s®, READ® and Seneca®; ● branded products under co-pack agreements to other major branded companies for their distribution; ● products to the Company’s industrial customer base for use as ingredients by other food manufacturers; and ● products to export customers in approximately 55 countries.

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The following table summarizes net sales by major product category for fiscal years 2026 and 2025 (in thousands):

Fiscal Year: 2026 2025 Canned vegetables $ 1,366,632 $ 1,314,315 Frozen vegetables 151,183 124,714 Fruit products 93,456 92,378 Snack products 15,020 14,995 Other 33,384 32,485 $ 1,659,675 $ 1,578,887

The Company’s high-quality products are primarily sourced from more than 1,100 American farms. The Company purchases other raw materials, including steel, ingredients and packaging materials from commodity processors, steel producers and packaging suppliers. Raw materials and other input costs, such as labor, fuel, utilities and transportation, are subject to fluctuations in price attributable to a number of factors. Certain of the raw materials, namely steel, are subject to import tariffs and other restrictions, and the United States government may periodically impose new or revise existing duties, quotas, tariffs or other restrictions to which the Company may be subject. Fluctuations in commodity prices can lead to retail price volatility and can influence consumer and trade buying patterns. The cost of raw materials, fuel, labor, distribution and other costs related to our operations can increase from time to time significantly and unexpectedly, the impact of which could increase our cost of products sold and reduce our profitability.

The Company experienced material cost increases to various production inputs during the last several years due to a number of factors, including but not limited to, supply chain disruptions, steel supply and pricing, raw material shortages, inflationary pressure, and labor shortages. Additionally, foreign conflicts have disrupted the global economic environment during these years. While the Company has no direct exposure to these foreign conflicts, some of which are ongoing, they have had a negative impact on the global economy which has increased certain of our input costs. While some of the factors mentioned above have started to ease and stabilize, the Company’s costs remain elevated as compared to historical levels.

The Company attempts to manage costs by locking in prices through short-term supply contracts, advance grower purchase agreements, and by implementing cost saving measures. The Company also attempts to offset rising input costs by raising sales prices to its customers. However, increases in the prices the Company charges its customers may lag behind rising input costs. Competitive pressures and pricing methodologies employed in the various sales channels in which the Company competes also may limit its ability to raise prices in response to rising costs. To the extent the Company is unable to avoid or offset any present or future cost increases, its operating results could be materially adversely affected.

As part of the acquisition discussed in Note 16 of the Notes to Consolidated Financial Statements in Part II, Item 8, “Financial Statements and Supplementary Data”, the Company acquired the Green Giant® trade name, the master license agreement for certain Green Giant® vegetable products, and assumed responsibility for the administration of the related sublicense agreements. The license does not include Green Giant Canada or the Le Sueur brand.

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The Company holds the Libby's® brand name pursuant to a trademark license. The license is limited to vegetables which are shelf-stable, frozen, and thermally packaged, and includes the Company's major vegetable varieties – sweet corn, peas and green beans – as well as certain other thermally packaged vegetable varieties and sauerkraut. The license is renewable at the Company's discretion every 10 years for an aggregate period expiring in March 2081.

The Company is required to pay an annual royalty to Libby's Brand Holding, Ltd., who may terminate the license for non-payment of royalty, use of the trademark in sales outside the licensed territory, failure to achieve a minimum level of sales under the licensed trademark during any calendar year or a material breach or default by the Company under the agreement (which is not cured within the specified cure period). A total of $0.1 million was paid as a royalty fee for the fiscal year ended March 31, 2026.

The Company also sells canned vegetables, frozen vegetables, jarred fruit, and other food products under several other brands for which the Company has obtained registered trademarks, including, Aunt Nellie’s®, CherryMan®, Green Valley®, READ®, Seneca®, and other regional brands.

The Company’s production cycle begins with planting in the spring followed by harvesting and packaging during the second and third fiscal quarters with sales spanning over the following twelve months. The last fiscal quarter ending March 31 is the optimal time for maintenance, repairs and equipment changes in the Company's seasonal packaging plants. The supply of commodities, current pricing, and expected new crop quantity and quality affect the timing and amount of the Company’s sales and earnings. When the seasonal harvesting periods of the Company's major vegetables are newly completed, inventories for these packaged vegetables are at their highest levels. For peas, the peak inventory time is mid-summer and for sweet corn and green beans, the Company's highest volume vegetables, the peak inventory is in mid-autumn. The seasonal nature of the Company’s production cycle results in inventory and accounts payable typically reaching their lowest point late in the fourth quarter prior to the new seasonal pack commencing. As the seasonal pack progresses, these components of working capital both increase until the pack is complete.

The Company’s fruit and vegetable sales exhibit seasonal increases in the third fiscal quarter due to increased retail demand during the holiday season. In addition, the Company sells canned and frozen vegetables to a co-pack customer on a bill and hold basis during the pack cycle, which typically occurs in the second and third quarters. Given the seasonal nature of the Company's sales, the accounts receivable balance typically reaches its highest point at the end of the second fiscal quarter.

These seasonal fluctuations are illustrated in the following table, which presents certain unaudited quarterly financial information for the periods indicated (in thousands):

First Quarter Second Quarter Third Quarter Fourth Quarter Fiscal Year 2026 Net sales $ 297,458 $ 460,022 $ 508,348 $ 393,847 Gross margin 41,811 61,867 83,460 44,076 Net earnings 14,885 29,739 44,768 25,282 Accounts receivable, net (at quarter end) 99,817 123,512 93,121 109,298 Inventories (at quarter end) 614,435 786,524 668,688 613,913 Accounts payable (at quarter end) 85,755 244,053 78,343 63,764 Revolver outstanding (at quarter end) 10,363 1,000 1,000 1,000 Fiscal Year 2025 Net sales $ 304,727 $ 425,465 $ 502,856 $ 345,839 Gross margin 42,691 42,871 49,110 15,529 Net earnings 12,661 13,303 14,659 601 Accounts receivable, net (at quarter end) 96,448 108,533 70,829 96,330 Inventories (at quarter end) 841,847 944,887 735,682 603,955 Accounts payable (at quarter end) 62,460 213,015 70,791 43,580 Revolver outstanding (at quarter end) 209,189 146,421 42,196 1,000

Competition in the packaged food industry is substantial with brand recognition and promotion, quality, service, and pricing being the major determinants in the Company’s relative market position. The Company is a major producer of canned vegetables, frozen vegetables, and jarred fruit; however, it competes with numerous companies of varying sizes, including divisions or subsidiaries of larger companies. Certain competitors may have greater resources and brand recognition. The Company believes its competitive strategies, which include providing superior product quality, effective cost control, an efficient supply chain, successful innovation programs, and strategic customer partnerships, allow it to compete effectively.

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The Company is subject to extensive regulations in the United States by federal, state and local government authorities. In the United States, the federal agencies governing the manufacture, marketing and distribution of our products include, among others, the Federal Trade Commission (“FTC”), the United States Food & Drug Administration (“FDA”), the United States Department of Agriculture (“USDA”), the United States Environmental Protection Agency (“EPA”) and the Occupational Safety and Health Administration (“OSHA”). Under various statutes, these agencies prescribe and establish, among other things, the requirements and standards for quality, safety and representation of the Company’s products to the consumer in labeling and advertising.

Environmental protection is an area that has been worked on diligently at each food packaging facility. In all locations, the Company has cooperated with federal, state, and local environmental protection authorities in developing and maintaining suitable antipollution facilities. In general, we believe our pollution control facilities are equal to or somewhat superior to those of our competitors and are within environmental protection standards. The Company does not expect any capital expenditures out of the ordinary course of business in order to comply with environmental regulations in the near future.

There has been a broad range of proposed and promulgated state, national and international regulations aimed at reducing the effects of climate change. Such regulations could result in the creation of additional costs in the form of taxes, consultant expenses, the restriction of output, investments of capital to maintain compliance with laws and regulations or required acquisition or trading of emission allowances. Climate change regulation continues to evolve, and while it is not possible to accurately estimate either a timetable for implementation or the Company’s future compliance costs relating to implementation, such regulation could have a material effect on our business, financial condition and results of operations.

Seneca publishes an annual Business Responsibility and Sustainability Report which highlights its vision for and approach to corporate sustainability and details key initiatives it is undertaking in the areas of environmental stewardship, social responsibility, and corporate governance. The report is available on our website and is not a part of this Annual Report on Form 10-K.

The Company takes its responsibility to be a good steward of the environment seriously and adopts policies and procedures under the guidance of the Board of Directors that advance our performance. We monitor existing and pending climate legislation and regulation to evaluate any potential impact on our future results of operations, capital expenditures or financial position. The Board of Directors provides oversight as part of their evaluation of business responsibility and sustainability initiatives, and we will continue to monitor emerging developments and assess our performance in this area. We may face additional economic and operational impacts from environmental and climate protection laws and regulations as well as impacts from our suppliers and customers as they adhere to such laws and regulations.

Employment

As of March 31, 2026, Seneca employed approximately 2,995 employees and employed an additional approximately 4,015 seasonal employees during the Company’s peak summer harvest season. 100% of our employees are distributed across the Company’s facilities located in the United States.

Culture

At Seneca, we work hard every day to feed the world safe and nutritious products, while adhering to our fundamental beliefs (which can be found on our website). These beliefs include acting with integrity in all matters, treating employees with respect, and maintaining the highest standards for protecting our workers. We also believe in promoting from within, which has resulted in many long-tenured employees in leadership positions throughout the Company.

Seneca believes that everyone should feel respected and welcome in our workplace. The Company is committed to providing equal opportunity in all aspects of employment, and to applying fair labor practices while respecting the national and local laws of the states and communities where we have operations. The Company does not engage in or tolerate discrimination, intimidation, harassment, or any other unlawful conduct. We believe that a diverse and inclusive workforce provides the Company with the benefits of different viewpoints and perspectives, as well as a talented and innovative employee base.

Employee Health and Safety

The health and safety of our employees is a top priority at Seneca. The Company complies with all national and local laws of the jurisdictions in which we operate regarding worker health and safety. In addition, we work to continuously improve our safety record with worker safety training and Seneca’s HERO (“Health Environment Risk Observation”) program, in which employees proactively identify and mitigate potential safety risks. At Seneca, we believe that safety is everyone’s responsibility, and the HERO program reflects that commitment, with close to 100% employee participation.

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The Company also conducts regular safety audits at all processing locations to ensure compliance with Seneca and OSHA safety standards. External risk management services are also consulted as part of this process. The Company’s management recognizes plants that achieve at least one million work hours or 1,000 days worked without a lost time injury to employees with the President’s “Bronze Eagle” award, which is prominently displayed at many of our processing facilities.

Employee Training and Development

Seneca believes in developing internal talent and providing employees with an opportunity for education and advancement. In support of this endeavor, we have developed three key programs. SAVES (“Seneca Adding Value Employee System”) focuses on employee empowerment, education, and application of lean manufacturing principles. The Company’s dedicated SAVES instructors and project leaders educate employees and empower them to make process improvements at all of our processing facilities. GROWS (“Get Rid of Waste Systemically”) supports our leadership development efforts through continuous improvement project leadership. LEADS ("Leadership Education and Development at Seneca") is a training program focused on leadership, managing employees in a positive and productive manner, and reinforces many of our fundamental beliefs, such as treating employees with respect.

Seneca Foods Corporation (“Seneca” or the “Company”) was founded in 1949 and has evolved through internal growth and strategic acquisitions into a leading provider of packaged fruits and vegetables, with 26 main facilities located throughout the United States. The facilities are comprised of plants for packaging, can manufacturing, seed production, a farming operation and a logistical support network. Food packaging operations are primarily supported by plant locations in New York, Michigan, Oregon, Wisconsin, Washington, Idaho, Illinois, and Minnesota. The Company also maintains warehouses which are generally located adjacent to its packaging plants. The Company is incorporated in New York with its headquarters located at 350 WillowBrook Office Park, Fairport, New York 14450 and its telephone number is (585) 495-4100.

The Company’s business strategies are designed to grow its market share and enhance sales and margins. These strategies include: 1) expand the Company’s leadership in the packaged fruit and vegetable industry; 2) provide low-cost, high-quality fruit and vegetable products to consumers through the elimination of costs from the Company’s supply chain and investment in state-of-the-art production and logistical technology; 3) focus on growth opportunities to capitalize on higher expected returns; and 4) pursue strategic acquisitions that leverage the Company’s core competencies.

The Company’s Internet address is www.senecafoods.com. The Company’s annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, are available on the Company’s website, as soon as reasonably practicable after they are electronically filed with or furnished to the SEC. All such filings on the Company’s website are available free of charge. Information on our website is not part of the annual report on Form 10-K.

In addition, the Company's website includes items related to corporate governance matters, including charters of various committees of the Board of Directors and the Company's Code of Business Conduct and Ethics. The Company intends to disclose on its website any amendment to or waiver of any provision of the Code of Business Conduct and Ethics that would otherwise be required to be disclosed under the rules of the SEC and NASDAQ.

The Company manages its business almost entirely on the basis of two reportable food packaging segments: Vegetable and Fruit/Snack. The Other category comprises non-food operations including revenue derived from the sale of cans, ends, seed, and outside revenue from the Company's aircraft operations, and certain corporate items. The Company’s food operations constituted 98% of total net sales in fiscal year 2025. Canned vegetables represented 83%, frozen vegetables represented 8%, fruit products represented 6%, and snack products represented 1% of the total food packaging net sales. Non-food packaging sales represented 2% of the Company's fiscal year 2025 net sales. Refer to the information set forth under the heading “Segment Information” in Note 12 of the Notes to Consolidated Financial Statements in Part II, Item 8, “Financial Statements and Supplementary Data”, for additional discussion about the Company’s segments.

The Company’s principal product offerings include canned, frozen and jarred produce, and snack chips. The Company manufactures and sells the following:

● private label products to retailers, such as supermarkets, mass merchandisers, and specialty retailers, for resale under the retailers’ own or controlled labels; ● private label and branded products to the foodservice industry, including foodservice distributors and national restaurant operators; ● branded products under national and regional brands that the Company owns or licenses, including Seneca®, Libby’s®, Green Giant®, Aunt Nellie’s®, CherryMan®, Green Valley® and READ®; ● branded products under co-pack agreements to other major branded companies for their distribution; and ● products to the Company’s industrial customer base for repackaging in portion control packages and for use as ingredients by other food manufacturers.

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The Company’s fruits and vegetables are sold nationwide by major grocery outlets, including supermarkets, mass merchandisers, limited assortment stores, club stores and dollar stores. The Company also sells its products to foodservice distributors, restaurant chains, industrial markets, other food processors, export customers in approximately 55 countries and federal, state and local governments for school and other food programs. Additionally, the Company packs canned and frozen vegetables under contract packing agreements. The following table summarizes net sales by major product category for fiscal years 2025 and 2024 (in thousands):

Fiscal Year: 2025 2024 Canned vegetables $ 1,314,315 $ 1,204,823 Frozen vegetables 124,714 120,795 Fruit products 92,378 87,435 Snack products 14,995 13,400 Other 32,485 32,150 $ 1,578,887 $ 1,458,603

The Company’s high-quality products are primarily sourced from more than 1,100 American farms. The Company purchases other raw materials, including steel, ingredients and packaging materials from commodity processors, steel producers and packaging suppliers. Raw materials and other input costs, such as labor, fuel, utilities and transportation, are subject to fluctuations in price attributable to a number of factors. Fluctuations in commodity prices can lead to retail price volatility and can influence consumer and trade buying patterns. The cost of raw materials, fuel, labor, distribution and other costs related to our operations can increase from time to time significantly and unexpectedly.

The Company experienced material cost increases to various production inputs during the last several years due to a number of factors, including but not limited to, supply chain disruptions, steel supply and pricing, raw material shortages, labor shortages, and the conflict between Russia and Ukraine. While the Company has no direct exposure to this foreign conflict, it had a negative impact on the global economy which increased certain of our input costs. While some of the factors mentioned above have started to ease and stabilize during fiscal year 2025, the Company’s costs remain elevated as compared to historical levels.

The Company attempts to manage costs by locking in prices through short-term supply contracts, advance grower purchase agreements, and by implementing cost saving measures. The Company also attempts to offset rising input costs by raising sales prices to its customers. However, increases in the prices the Company charges its customers may lag behind rising input costs. Competitive pressures and pricing methodologies employed in the various sales channels in which the Company competes also may limit its ability to raise prices in response to rising costs. To the extent the Company is unable to avoid or offset any present or future cost increases, its operating results could be materially adversely affected.

The following table sets forth United States and international net sales (in thousands, except percentages):

Fiscal Year: 2025 2024 Net sales: United States $ 1,492,266 $ 1,374,774 International 86,621 83,829 Total net sales $ 1,578,887 $ 1,458,603 As a percentage of net sales: United States 94.5 % 94.3 % International 5.5 % 5.7 % Total 100.0 % 100.0 %

The Company has a license agreement with B&G Foods, Inc., for use of the Green Giant® brand name to manufacture, market, distribute, and sell shelf-stable vegetable products within the United States and its territories, and certain Caribbean islands in perpetuity. The license is royalty free and does not include Green Giant frozen, Green Giant Canada or the Le Sueur brand.

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The Company holds the Libby's® brand name pursuant to a trademark license. The license is limited to vegetables which are shelf-stable, frozen, and thermally packaged, and includes the Company's major vegetable varieties – sweet corn, peas and green beans – as well as certain other thermally packaged vegetable varieties and sauerkraut. The license is renewable by the Company every 10 years for an aggregate period expiring in March 2081.

The Company is required to pay an annual royalty to Libby's Brand Holding, Ltd., who may terminate the license for non-payment of royalty, use of the trademark in sales outside the licensed territory, failure to achieve a minimum level of sales under the licensed trademark during any calendar year or a material breach or default by the Company under the agreement (which is not cured within the specified cure period). A total of $0.1 million was paid as a royalty fee for the fiscal year ended March 31, 2025.

The Company also sells canned vegetables, frozen vegetables, jarred fruit, and other food products under several other brands for which the Company has obtained registered trademarks, including, Aunt Nellie’s®, CherryMan®, Green Valley®, READ®, Seneca®, and other regional brands.

The Company’s production cycle begins with planting in the spring followed by harvesting and packaging during the second and third fiscal quarters with sales spanning over the following twelve months. Minimal food packaging occurs in the Company's last fiscal quarter ending March 31, which is the optimal time for maintenance, repairs and equipment changes in its packaging plants. The supply of commodities, current pricing, and expected new crop quantity and quality affect the timing and amount of the Company’s sales and earnings. When the seasonal harvesting periods of the Company's major vegetables are newly completed, inventories for these packaged vegetables are at their highest levels. For peas, the peak inventory time is mid-summer and for sweet corn and green beans, the Company's highest volume vegetables, the peak inventory is in mid-autumn. The seasonal nature of the Company’s production cycle results in inventory and accounts payable typically reaching their lowest point in mid-to-late first quarter prior to the new seasonal pack commencing. As the seasonal pack progresses, these components of working capital both increase until the pack is complete.

The Company’s fruit and vegetable sales exhibit seasonal increases in the third fiscal quarter due to increased retail demand during the holiday season. In addition, the Company sells canned and frozen vegetables to a co-pack customer on a bill and hold basis during the pack cycle, which typically occurs in the second and third quarters. Given the seasonal nature of the Company's sales, the accounts receivable balance typically reaches its highest point at the end of the second fiscal quarter.

These seasonal fluctuations are illustrated in the following table, which presents certain unaudited quarterly financial information for the periods indicated (in thousands):

First Quarter Second Quarter Third Quarter Fourth Quarter Fiscal Year 2025: Net sales $ 304,727 $ 425,465 $ 502,856 $ 345,839 Gross margin 42,691 42,871 49,110 15,529 Net earnings 12,661 13,303 14,659 601 Accounts receivable, net (at quarter end) 96,448 108,533 70,829 96,330 Inventories (at quarter end) 841,847 944,887 735,682 603,955 Accounts payable (at quarter end) 62,460 213,015 70,791 43,580 Revolver outstanding (at quarter end) 209,189 146,421 42,196 1,000 Fiscal Year 2024: Net sales $ 298,664 $ 407,475 $ 444,481 $ 307,983 Gross margin 55,289 58,118 54,033 20,778 Net earnings (loss) 23,111 24,779 17,675 (2,247 ) Accounts receivable, net (at quarter end) 84,964 128,380 89,928 79,767 Inventories (at quarter end) 735,124 1,013,447 968,889 872,692 Accounts payable (at quarter end) 117,700 321,579 125,182 40,326 Revolver outstanding (at quarter end) 52,064 134,757 258,108 237,225

Competition in the packaged food industry is substantial with brand recognition and promotion, quality, service, and pricing being the major determinants in the Company’s relative market position. The Company believes that it is a major producer of canned vegetables, frozen vegetables, and jarred fruit but some producers of these products have sales which exceed the Company's sales. The Company is aware of at least 13 competitors in the United States packaged fruit and vegetable industry, many of which are privately held companies.

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The Company is subject to extensive regulations in the United States by federal, state and local government authorities. In the United States, the federal agencies governing the manufacture, marketing and distribution of our products include, among others, the Federal Trade Commission (“FTC”), the United States Food & Drug Administration (“FDA”), the United States Department of Agriculture (“USDA”), the United States Environmental Protection Agency (“EPA”) and the Occupational Safety and Health Administration (“OSHA”). Under various statutes, these agencies prescribe and establish, among other things, the requirements and standards for quality, safety and representation of the Company’s products to the consumer in labeling and advertising.

Environmental protection is an area that has been worked on diligently at each food packaging facility. In all locations, the Company has cooperated with federal, state, and local environmental protection authorities in developing and maintaining suitable antipollution facilities. In general, we believe our pollution control facilities are equal to or somewhat superior to those of our competitors and are within environmental protection standards. The Company does not expect any capital expenditures out of the ordinary course of business in order to comply with environmental regulations in the near future.

There has been a broad range of proposed and promulgated state, national and international regulations aimed at reducing the effects of climate change. In the United States, there is a possibility that some form of regulation will be forthcoming at the federal level to address the effects of climate change. Such regulation could result in the creation of additional costs in the form of taxes, consultant expenses, the restriction of output, investments of capital to maintain compliance with laws and regulations or required acquisition or trading of emission allowances. Climate change regulation continues to evolve, and while it is not possible to accurately estimate either a timetable for implementation or the Company’s future compliance costs relating to implementation, such regulation could have a material effect on our business, financial condition and results of operations.

Seneca publishes an annual Business Responsibility and Sustainability Report which highlights its vision for and approach to corporate sustainability and details key initiatives it is undertaking in the areas of environmental stewardship, social responsibility, and corporate governance. The report is available on our website and is not a part of this Annual Report on Form 10-K.

The Company takes its responsibility to be a good steward of the environment seriously and adopts policies and procedures under the guidance of the Board of Directors that advance our performance. We monitor existing and pending climate legislation and regulation to evaluate any potential impact on our future results of operations, capital expenditures or financial position. The Board of Directors provides oversight as part of their evaluation of business responsibility and sustainability initiatives, and we will continue to monitor emerging developments and assess our performance in this area. We may face additional economic and operational impacts from environmental and climate protection laws and regulations as well as impacts from our suppliers and customers as they adhere to such laws and regulations.

Employment

As of March 31, 2025, Seneca employed approximately 2,885 employees and employed an additional approximately 4,010 seasonal employees during the Company’s peak summer harvest season. 100% of our employees are located in the United States, distributed across the Company’s facilities.

Culture

At Seneca, we work hard every day to feed the world safe and nutritious products, while adhering to our fundamental beliefs (which can be found on our website). These beliefs include acting with integrity in all matters, treating employees with respect, and maintaining the highest standards for protecting our workers. We also believe in promoting from within, which has resulted in many long-tenured employees in leadership positions throughout the Company.

Employee Health and Safety

The health and safety of our employees is a top priority at Seneca. The Company complies with all national and local laws of the jurisdictions in which we operate regarding worker health and safety. In addition, we work to continuously improve our safety record with worker safety training and Seneca’s HERO (“Health Environment Risk Observation”) program, in which employees proactively identify and mitigate potential safety risks. At Seneca, we believe that safety is everyone’s responsibility, and the HERO program reflects that commitment, with close to 100% employee participation.

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The Company also conducts regular safety audits at all processing locations to ensure compliance with Seneca and OSHA safety standards. External risk management services are also consulted as part of this process. The Company’s management recognizes plants that achieve at least one million work hours or 1,000 days worked without a lost time injury to employees with the President’s “Bronze Eagle” award, which is prominently displayed at many of our processing facilities.

Employee Training and Development

Seneca believes in developing internal talent and providing employees with an opportunity for education and advancement. In support of this endeavor, we have developed three key programs. SAVES (“Seneca Adding Value Employee System”) focuses on employee empowerment, education, and application of lean manufacturing principles. The Company’s dedicated SAVES instructors and project leaders educate employees and empower them to make process improvements at all of our processing facilities. GROWS (“Get Rid of Waste Systemically”) supports our leadership development efforts through continuous improvement project leadership. LEADS ("Leadership Education and Development at Seneca") is a training program focused on leadership, managing employees in a positive and productive manner, and reinforces many of our fundamental beliefs, such as treating employees with respect.

Culture

Seneca believes that everyone should feel respected and welcome in our workplace. The Company is committed to providing equal opportunity in all aspects of employment, and to applying fair labor practices while respecting the national and local laws of the states and communities where we have operations. The Company does not engage in or tolerate discrimination, intimidation, harassment, or any other unlawful conduct. We believe that a diverse and inclusive workforce provides the Company with the benefits of different viewpoints and perspectives, as well as a talented and innovative employee base.

Seneca Foods Corporation (“Seneca” or the “Company”) was founded in 1949 and has evolved through internal growth and strategic acquisitions into a leading provider of packaged fruits and vegetables, with 26 main facilities located throughout the United States. The facilities are comprised of plants for packaging, can manufacturing, seed production, a farming operation and a logistical support network. Food packaging operations are primarily supported by plant locations in New York, Michigan, Oregon, Wisconsin, Washington, Idaho, Illinois, and Minnesota. The Company also maintains warehouses which are generally located adjacent to its packaging plants. The Company is incorporated in New York with its headquarters located at 350 WillowBrook Office Park, Fairport, New York 14450 and its telephone number is (585) 495-4100.

The Company’s business strategies are designed to grow its market share and enhance sales and margins. These strategies include: 1) expand the Company’s leadership in the packaged fruit and vegetable industry; 2) provide low-cost, high-quality fruit and vegetable products to consumers through the elimination of costs from the Company’s supply chain and investment in state-of-the-art production and logistical technology; 3) focus on growth opportunities to capitalize on higher expected returns; and 4) pursue strategic acquisitions that leverage the Company’s core competencies.

The Company’s Internet address is www.senecafoods.com. The Company’s annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, are available on the Company’s web site, as soon as reasonably practicable after they are electronically filed with or furnished to the SEC. All such filings on the Company’s web site are available free of charge. Information on our website is not part of the annual report on Form 10-K.

In addition, the Company's website includes items related to corporate governance matters, including charters of various committees of the Board of Directors and the Company's Code of Business Conduct and Ethics. The Company intends to disclose on its website any amendment to or waiver of any provision of the Code of Business Conduct and Ethics that would otherwise be required to be disclosed under the rules of the SEC and NASDAQ.

The Company manages its business almost entirely on the basis of two reportable food packaging segments: Vegetable and Fruit/Snack. The Other category comprises non-food operations including revenue derived from the sale of cans, ends, seed, and outside revenue from the Company's trucking and aircraft operations, and certain corporate items. The Company’s food operations constituted 98% of total net sales in fiscal year 2024. Canned vegetables represented 83%, frozen vegetables represented 8%, fruit products represented 6%, and snack products represented 1% of the total food packaging net sales. Non-food packaging sales represented 2% of the Company's fiscal year 2024 net sales. Refer to the information set forth under the heading “Segment Information” in Note 13 of the Notes to Consolidated Financial Statements in Part II, Item 8, “Financial Statements and Supplementary Data”, for additional discussion about the Company’s segments.

The Company’s principal product offerings include canned, frozen and jarred produce, and snack chips. The Company manufactures and sells the following:

● private label products to retailers, such as supermarkets, mass merchandisers, and specialty retailers, for resale under the retailers’ own or controlled labels; ● private label and branded products to the foodservice industry, including foodservice distributors and national restaurant operators; ● branded products under national and regional brands that the Company owns or licenses, including Seneca®, Libby’s®, Green Giant®, Aunt Nellie’s®, CherryMan®, Green Valley® and READ®; ● branded products under co-pack agreements to other major branded companies for their distribution; and ● products to the Company’s industrial customer base for repackaging in portion control packages and for use as ingredients by other food manufacturers.

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The Company’s fruits and vegetables are sold nationwide by major grocery outlets, including supermarkets, mass merchandisers, limited assortment stores, club stores and dollar stores. The Company also sells its products to foodservice distributors, restaurant chains, industrial markets, other food processors, export customers in approximately 55 countries and federal, state and local governments for school and other food programs. Additionally, the Company packs canned and frozen vegetables under contract packing agreements. The following table summarizes net sales by major product category for fiscal years 2024 and 2023 (in thousands):

Fiscal Year: 2024 2023 Canned vegetables $ 1,204,823 $ 1,253,257 Frozen vegetables 120,795 121,211 Fruit products 87,435 91,495 Snack products 13,400 12,661 Other 32,150 30,728 $ 1,458,603 $ 1,509,352

The Company’s high-quality products are primarily sourced from more than 1,200 American farms. The Company purchases other raw materials, including steel, ingredients and packaging materials from commodity processors, steel producers and packaging suppliers. Raw materials and other input costs, such as labor, fuel, utilities and transportation, are subject to fluctuations in price attributable to a number of factors. Fluctuations in commodity prices can lead to retail price volatility and can influence consumer and trade buying patterns. The cost of raw materials, fuel, labor, distribution and other costs related to our operations can increase from time to time significantly and unexpectedly.

The Company continues to experience material cost inflation for many of its raw materials and other input costs attributable to a number of factors, including but not limited to, supply chain disruptions (including raw material shortages), labor shortages, the conflict between Russia and Ukraine, and the conflict in Israel and Gaza. While the Company has no direct exposure to these conflicts, it has continued to experience increased costs for transportation, energy, and raw materials due in part to the negative impact on the global economy. The Company attempts to manage cost inflation risks by locking in prices through short-term supply contracts, advance grower purchase agreements, and by implementing cost saving measures. The Company also attempts to offset rising input costs by raising sales prices to its customers. However, increases in the prices the Company charges its customers may lag behind rising input costs. Competitive pressures also may limit the Company’s ability to quickly raise prices in response to rising costs. To the extent the Company is unable to avoid or offset any present or future cost increases, its operating results could be materially adversely affected.

The following table sets forth domestic and international sales (in thousands, except percentages):

Fiscal Year 2024 2023 Net sales: Domestic $ 1,374,774 $ 1,408,710 International 83,829 100,642 Total net sales $ 1,458,603 $ 1,509,352 As a percentage of net sales: Domestic 94.3 % 93.3 % International 5.7 % 6.7 % Total 100.0 % 100.0 %

The Company has a license agreement with B&G Foods, Inc., for use of the Green Giant® brand name to manufacture, market, distribute, and sell shelf-stable vegetable products within the United States and its territories, and certain Caribbean islands in perpetuity. The license is royalty free and does not include Green Giant frozen, Green Giant Canada or the Le Sueur brand.

The Company holds the Libby's® brand name pursuant to a trademark license. The license is limited to vegetables which are shelf-stable, frozen, and thermally packaged, and includes the Company's major vegetable varieties – corn, peas and green beans – as well as certain other thermally packaged vegetable varieties and sauerkraut. The license is renewable by the Company every 10 years for an aggregate period expiring in March 2081.

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The Company is required to pay an annual royalty to Libby's Brand Holding, Ltd., who may terminate the license for non-payment of royalty, use of the trademark in sales outside the licensed territory, failure to achieve a minimum level of sales under the licensed trademark during any calendar year or a material breach or default by the Company under the agreement (which is not cured within the specified cure period). A total of $0.1 million was paid as a royalty fee for the fiscal year ended March 31, 2024.

The Company also sells canned vegetables, frozen vegetables, jarred fruit, and other food products under several other brands for which the Company has obtained registered trademarks, including, Aunt Nellie’s®, CherryMan®, Green Valley®, READ®, Seneca®, and other regional brands.

While individual vegetables have seasonal cycles of peak production and sales, the different cycles are somewhat offsetting. Minimal food packaging occurs in the Company's last fiscal quarter ending March 31, which is the optimal time for maintenance, repairs and equipment changes in its packaging plants. The supply of commodities, current pricing, and expected new crop quantity and quality affect the timing and amount of the Company’s sales and earnings. When the seasonal harvesting periods of the Company's major vegetables are newly completed, inventories for these packaged vegetables are at their highest levels. For peas, the peak inventory time is mid-summer and for corn and green beans, the Company's highest volume vegetables, the peak inventory is in mid-autumn. The seasonal nature of the Company’s production cycle results in inventory and accounts payable reaching their lowest point late in mid-to-late first quarter prior to the new seasonal pack commencing. As the seasonal pack progresses, these components of working capital both increase until the pack is complete.

The Company’s revenues typically are highest in the second and third fiscal quarters. This is due, in part, because the Company’s fruit and vegetable sales exhibit seasonal increases in the third fiscal quarter due to increased retail demand during the holiday season. In addition, the Company sells canned and frozen vegetables to a co-pack customer on a bill and hold basis at the end of each pack cycle, which typically occurs during these quarters.

These seasonal fluctuations are illustrated in the following table, which presents certain unaudited quarterly financial information for the periods indicated (in thousands):

First Quarter Second Quarter Third Quarter Fourth Quarter Fiscal Year 2024: Net sales $ 298,664 $ 407,475 $ 444,481 $ 307,983 Gross margin 55,289 58,118 54,033 20,778 Net earnings (loss) 23,111 24,779 17,675 (2,247 ) Revolver outstanding (at quarter end) 52,064 134,757 258,108 237,225 Fiscal Year 2023: Net sales $ 265,193 $ 439,842 $ 473,254 $ 331,063 Gross margin 22,843 41,779 53,789 (14,092 ) Net earnings (loss) 5,103 16,131 21,054 (33,057 ) Revolver outstanding (at quarter end) 78,965 229,213 313,808 180,598

Competition in the packaged food industry is substantial with brand recognition and promotion, quality, service, and pricing being the major determinants in the Company’s relative market position. The Company believes that it is a major producer of canned vegetables, frozen vegetables, and jarred fruit but some producers of these products have sales which exceed the Company's sales. The Company is aware of at least 13 competitors in the U.S. packaged fruit and vegetable industry, many of which are privately held companies.

The Company is subject to extensive regulations in the United States by federal, state and local government authorities. In the United States, the federal agencies governing the manufacture, marketing and distribution of our products include, among others, the Federal Trade Commission (“FTC”), the United States Food & Drug Administration (“FDA”), the United States Department of Agriculture (“USDA”), the United States Environmental Protection Agency (“EPA”) and the Occupational Safety and Health Administration (“OSHA”). Under various statutes, these agencies prescribe and establish, among other things, the requirements and standards for quality, safety and representation of the Company’s products to the consumer in labeling and advertising.

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Environmental protection is an area that has been worked on diligently at each food packaging facility. In all locations, the Company has cooperated with federal, state, and local environmental protection authorities in developing and maintaining suitable antipollution facilities. In general, we believe our pollution control facilities are equal to or somewhat superior to those of our competitors and are within environmental protection standards. The Company does not expect any capital expenditures out of the ordinary course of business in order to comply with environmental regulations in the near future.

There has been a broad range of proposed and promulgated state, national and international regulations aimed at reducing the effects of climate change. In the United States, there is a significant possibility that some form of regulation will be forthcoming at the federal level to address the effects of climate change. Such regulation could result in the creation of additional costs in the form of taxes, consultant expenses, the restriction of output, investments of capital to maintain compliance with laws and regulations or required acquisition or trading of emission allowances.

Seneca publishes an annual Corporate Responsibility Report which highlights its vision for and approach to corporate sustainability and details key initiatives it is undertaking in the areas of environmental stewardship, social responsibility, and corporate governance. The report is available on our website and is not a part of this Annual Report on Form 10-K.

The Company takes its responsibility to be a good steward of the environment seriously and adopts policies and procedures under the guidance of the Board of Directors that advance our performance. We monitor existing and pending climate legislation and regulation to evaluate any potential impact on our future results of operations, capital expenditures or financial position. The Board of Directors provides oversight as part of their evaluation of business responsibility and sustainability initiatives, and we will continue to monitor emerging developments and assess our performance in this area. We may face additional economic and operational impacts from ESG regulations as well as impacts from our suppliers and customers as they adhere to the laws and regulations.

Employment

As of March 31, 2024, Seneca employed approximately 2,900 employees and employed an additional approximately 3,900 seasonal employees during the Company’s peak summer harvest season. 100% of our employees are located in the United States, distributed across the Company’s facilities.

Culture

At Seneca, we work hard every day to feed the world safe and nutritious products, while adhering to our fundamental beliefs (which can be found on our website). These beliefs include acting with integrity in all matters, treating employees with respect, and maintaining the highest standards for protecting our workers. We also believe in promoting from within, which has resulted in many long-tenured employees in leadership positions throughout the Company.

Employee Health and Safety

The health and safety of our employees is a top priority at Seneca. The Company complies with all national and local laws of the jurisdictions in which we operate regarding worker health and safety. In addition, we work to continuously improve our safety record with worker safety training and Seneca’s HERO (“Health Environment Risk Observation”) program, in which employees proactively identify and mitigate potential safety risks. At Seneca, we believe that safety is everyone’s responsibility, and the HERO program reflects that commitment, with close to 100% employee participation.

The Company also conducts annual safety audits at all processing locations to ensure compliance with Seneca and OSHA safety standards. External risk management services are also consulted as part of this process. The Company’s management recognizes plants that achieve at least one million work hours or 1,000 days worked without a lost time injury to employees with the President’s “Bronze Eagle” award, which is prominently displayed at many of our processing facilities.

Employee Training and Development

Seneca believes in developing internal talent and providing employees with an opportunity for education and advancement. In support of this endeavor, we have developed three key programs. SAVES (“Seneca Adding Value Employee System”) focuses on employee empowerment, education, and application of lean manufacturing principles. The Company’s dedicated SAVES instructors and project leaders educate employees and empower them to make process improvements at all of our processing facilities. GROWS (“Get Rid of Waste Systemically”) supports our leadership development efforts through continuous improvement project leadership. LEADS ("Leadership Education and Development at Seneca") is a training program focused on leadership, managing employees in a positive and productive manner, and reinforces many of our fundamental beliefs, such as treating employees with respect.

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Culture

Seneca believes that everyone should feel respected and welcome in our workplace. The Company is committed to providing equal opportunity in all aspects of employment, and to applying fair labor practices while respecting the national and local laws of the states and communities where we have operations. The Company does not engage in or tolerate discrimination, intimidation, harassment, or any other unlawful conduct. We believe that a diverse and inclusive workforce provides the Company with the benefits of different viewpoints and perspectives, as well as a talented and innovative employee base.

While individual vegetables have seasonal cycles of peak production and sales, the different cycles are somewhat offsetting. Minimal food packaging occurs in the Company's last fiscal quarter ending March 31, which is the optimal time for maintenance, repairs and equipment changes in its packaging plants. The supply of commodities, current pricing, and expected new crop quantity and quality affect the timing and amount of the Company’s sales and earnings. When the seasonal harvesting periods of the Company's major vegetables are newly completed, inventories for these packaged vegetables are at their highest levels. For peas, the peak inventory time is mid-summer and for corn and green beans, the Company's highest volume vegetables, the peak inventory is in mid-autumn. The seasonal nature of the Company’s production cycle results in inventory and accounts payable reaching their lowest point late in the fourth quarter/early in the first quarter prior to the new seasonal pack commencing. As the seasonal pack progresses, these components of working capital both increase until the pack is complete.

The Company’s revenues typically are highest in the second and third fiscal quarters. This is due, in part, because the Company’s fruit and vegetable sales exhibit seasonal increases in the third fiscal quarter due to increased retail demand during the holiday season. In addition, the Company sells canned and frozen vegetables to a co-pack customer on a bill and hold basis at the end of each pack cycle, which typically occurs during these quarters.

These seasonal fluctuations are illustrated in the following table, which presents certain unaudited quarterly financial information for the periods indicated (in thousands):

First Quarter Second Quarter Third Quarter Fourth Quarter (Restated) Fiscal Year 2023: Net sales $ 265,193 $ 439,842 $ 473,254 $ 331,063 Gross margin 22,843 41,779 53,789 (14,092 ) Net earnings 5,103 16,131 21,054 (33,057 ) Fiscal Year 2022: Net sales $ 235,042 $ 372,256 $ 445,593 $ 332,389 Gross margin 33,623 42,728 44,985 20,260 Net earnings 14,136 11,654 18,664 1,746

Seneca Foods Corporation (“Seneca” or the “Company”) was founded in 1949 and has evolved through internal growth and strategic acquisitions into a leading provider of packaged fruits and vegetables, with 26 main facilities located throughout the United States. The facilities are comprised of plants for packaging, can manufacturing, seed production, a farming operation and a logistical support network. Food packaging operations are primarily supported by plant locations in New York, Michigan, Oregon, Wisconsin, Washington, Idaho, Illinois, and Minnesota. The Company also maintains warehouses which are generally located adjacent to its packaging plants. The Company is incorporated in New York with its headquarters located at 350 WillowBrook Office Park Fairport, New York and its telephone number is (585) 495-4100.

The Company’s business strategies are designed to grow its market share and enhance sales and margins. These strategies include: 1) expand the Company’s leadership in the packaged fruit and vegetable industry; 2) provide low-cost, high-quality vegetable products to consumers through the elimination of costs from the Company’s supply chain and investment in state-of-the-art production and logistical technology; 3) focus on growth opportunities to capitalize on higher expected returns; and 4) pursue strategic acquisitions that leverage the Company’s core competencies.

The Company’s Internet address is www.senecafoods.com. The Company’s annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, are available on the Company’s web site, as soon as reasonably practicable after they are electronically filed with or furnished to the SEC. All such filings on the Company’s web site are available free of charge. Information on our website is not part of the annual report on Form 10-K.

In addition, the Company's website includes items related to corporate governance matters, including charters of various committees of the Board of Directors and the Company's Code of Business Conduct and Ethics. The Company intends to disclose on its website any amendment to or waiver of any provision of the Code of Business Conduct and Ethics that would otherwise be required to be disclosed under the rules of the SEC and NASDAQ.

The Company has historically managed its business on the basis of three reportable food packaging segments: (1) fruits and vegetables, (2) prepared food products and (3) snack products. The other category comprises non-food packaging sales which relate to the sale of cans, ends, seed, and outside revenue from the Company's trucking and aircraft operations. During fiscal year 2021, the Company sold its prepared foods business, leaving just two reportable segments along with the other category. The Company’s food operation constituted 98% of total net sales in fiscal year 2023. Canned vegetables represented 83%, frozen vegetables represented 8%, fruit products represented 6%, and chip products represented 1% of the total food packaging net sales. Non-food packaging sales represented 2% of the Company's fiscal year 2023 net sales. Refer to the information set forth under the heading “Segment Information” in Note 14 of the Notes to Consolidated Financial Statements in Part II, Item 8, “Financial Statements and Supplementary Data”, for additional discussion about the Company’s segments.

The Company’s principal product offerings include canned, frozen and bottled produce, and snack chips. The Company manufactures and sells the following:

● private label products to retailers, such as supermarkets, mass merchandisers, and specialty retailers, for resale under the retailers’ own or controlled labels;

● private label and branded products to the foodservice industry, including foodservice distributors and national restaurant operators;

● branded products under national and regional brands that the Company owns or licenses, including Seneca®, Libby’s®, Aunt Nellie’s®, Cherryman®, Green Valley® and READ®;

● branded products under co-pack agreements to other major branded companies for their distribution; and

● products to the Company’s industrial customer base for repackaging in portion control packages and for use as ingredients by other food manufacturers.

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The Company’s fruits and vegetables are sold nationwide by major grocery outlets, including supermarkets, mass merchandisers, limited assortment stores, club stores and dollar stores. The Company also sells its products to foodservice distributors, restaurants chains, industrial markets, other food processors, export customers in approximately 60 countries and federal, state and local governments for school and other food programs. Additionally, the Company packs canned and frozen vegetables under contract packing agreements. The following table summarizes net sales by major product category for fiscal years 2023 and 2022 (in thousands):

Fiscal Year: 2023 2022 Canned vegetables $ 1,253,257 $ 1,135,983 Frozen vegetables 121,211 123,895 Fruit products 91,495 84,708 Snack products 12,661 12,332 Other 30,728 28,362 $ 1,509,352 $ 1,385,280

The Company’s high-quality products are primarily sourced from approximately 1,400 American farms. The Company purchases other raw materials, including steel, ingredients and packaging materials from commodity processors, steel producers and packaging suppliers. Raw materials and other input costs, such as labor, fuel, utilities and transportation, are subject to fluctuations in price attributable to a number of factors. Fluctuations in commodity prices can lead to retail price volatility and can influence consumer and trade buying patterns. The cost of raw materials, fuel, labor, distribution and other costs related to our operations can increase from time to time significantly and unexpectedly.

The Company continues to experience material cost inflation for many of its raw materials and other input costs attributable to a number of factors, including but not limited to, supply chain disruptions (including raw material shortages), labor shortages, and the war in Ukraine. While the Company has no direct exposure to Russia and Ukraine, it has experienced increased costs for transportation, energy, and raw materials due in part to the negative impact of the Russia-Ukraine conflict on the global economy. The Company attempts to manage cost inflation risks by locking in prices through short-term supply contracts, advance grower purchase agreements, and by implementing cost saving measures. The Company also attempts to offset rising input costs by raising sales prices to its customers. However, increases in the prices the Company charges its customers may lag behind rising input costs. Competitive pressures also may limit the Company’s ability to quickly raise prices in response to rising costs. To the extent the Company is unable to avoid or offset any present or future cost increases its operating results could be materially adversely affected.

The following table sets forth domestic and international sales (In thousands, except percentages):

Fiscal Year 2023 2022 Net sales: Domestic $ 1,408,710 $ 1,285,540 International 100,642 99,740 Total net sales $ 1,509,352 $ 1,385,280 As a percentage of net sales: Domestic 93.3 % 92.8 % International 6.7 % 7.2 % Total 100.0 % 100.0 %

The Company's most significant brand name, Libby's®, is held pursuant to a trademark license granted to the Company in March 1982 and renewable by the Company every 10 years for an aggregate period expiring in March 2081. The original licensor was Libby, McNeill & Libby, Inc., then an indirect subsidiary of Nestlé, S. A. ("Nestlé") and the license was granted in connection with the Company's purchase of certain of the licensor's canned vegetable operations in the United States. Corlib Brands Management, LTD acquired the license from Nestlé during 2006. The license is limited to vegetables which are shelf-stable, frozen, and thermally packaged, and includes the Company's major vegetable varieties – corn, peas and green beans – as well as certain other thermally packaged vegetable varieties and sauerkraut.

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The Company is required to pay an annual royalty to Corlib Brands, now known as Libby's Brand Holding, Ltd., who may terminate the license for non-payment of royalty, use of the trademark in sales outside the licensed territory, failure to achieve a minimum level of sales under the licensed trademark during any calendar year or a material breach or default by the Company under the agreement (which is not cured within the specified cure period). A total of $0.1 million was paid as a royalty fee for the fiscal year ended March 31, 2023.

The Company also sells canned vegetables, frozen vegetables, jarred fruit, and other food products under several other brands for which the Company has obtained registered trademarks, including, Aunt Nellie’s®, CherryMan®, Green Valley®, READ®, Seneca®, and other regional brands.

While individual vegetables have seasonal cycles of peak production and sales, the different cycles are somewhat offsetting. Minimal food packaging occurs in the Company's last fiscal quarter ending March 31, which is the optimal time for maintenance, repairs and equipment changes in its packaging plants. The supply of commodities, current pricing, and expected new crop quantity and quality affect the timing and amount of the Company’s sales and earnings. When the seasonal harvesting periods of the Company's major vegetables are newly completed, inventories for these packaged vegetables are at their highest levels. For peas, the peak inventory time is mid-summer and for corn and green beans, the Company's highest volume vegetables, the peak inventory is in mid-autumn. The seasonal nature of the Company’s production cycle results in inventory and accounts payable reaching their lowest point late in the fourth quarter/early in the first quarter prior to the new seasonal pack commencing. As the seasonal pack progresses, these components of working capital both increase until the pack is complete.

The Company’s revenues typically are highest in the second and third fiscal quarters. This is due, in part, because the Company’s fruit and vegetable sales exhibit seasonal increases in the third fiscal quarter due to increased retail demand during the holiday season. In addition, the Company sells canned and frozen vegetables to a co-pack customer on a bill and hold basis at the end of each pack cycle, which typically occurs during these quarters.

These seasonal fluctuations are illustrated in the following table, which presents certain unaudited quarterly financial information for the periods indicated (in thousands):

First Quarter Second Quarter Third Quarter Fourth Quarter Fiscal Year 2023: Net sales $ 265,193 $ 439,842 $ 473,254 $ 331,063 Gross margin 22,843 41,779 53,789 17,485 Net earnings 5,103 16,131 21,054 (9,150 ) Fiscal Year 2022: Net sales $ 235,042 $ 372,256 $ 445,593 $ 332,389 Gross margin 33,623 42,728 44,985 26,596 Net earnings 14,136 11,654 18,664 6,553

Competition in the packaged food industry is substantial with brand recognition and promotion, quality, service, and pricing being the major determinants in the Company’s relative market position. The Company believes that it is a major producer of canned vegetables, frozen vegetables, and jarred fruit but some producers of these products have sales which exceed the Company's sales. The Company is aware of at least 13 competitors in the U.S. packaged fruit and vegetable industry, many of which are privately held companies.

The Company is subject to extensive regulations in the United States by federal, state and local government authorities. In the United States, the federal agencies governing the manufacture, marketing and distribution of our products include, among others, the Federal Trade Commission (“FTC”), the United States Food & Drug Administration (“FDA”), the United States Department of Agriculture (“USDA”), the United States Environmental Protection Agency (“EPA”) and the Occupational Safety and Health Administration (“OSHA”). Under various statutes, these agencies prescribe and establish, among other things, the requirements and standards for quality, safety and representation of the Company’s products to the consumer in labeling and advertising.

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Environmental protection is an area that has been worked on diligently at each food packaging facility. In all locations, the Company has cooperated with federal, state, and local environmental protection authorities in developing and maintaining suitable antipollution facilities. In general, we believe our pollution control facilities are equal to or somewhat superior to those of our competitors and are within environmental protection standards. The Company does not expect any capital expenditures out of the ordinary course of business in order to comply with environmental regulations in the near future.

There has been a broad range of proposed and promulgated state, national and international regulations aimed at reducing the effects of climate change. In the United States, there is a significant possibility that some form of regulation will be forthcoming at the federal level to address the effects of climate change. Such regulation could result in the creation of additional costs in the form of taxes, consultant expenses, the restriction of output, investments of capital to maintain compliance with laws and regulations or required acquisition or trading of emission allowances.

Employment

As of March 31, 2023, Seneca Foods employed 2,809 full-time employees and averaged approximately an additional 3,600 seasonal employees during the Company’s peak summer harvest season. 100% of our employees are located in the United States, distributed across the Company’s facilities.

Culture

At Seneca Foods, we work hard every day to feed the world safe and nutritious products, while adhering to our fundamental beliefs (which can be found on our website). These beliefs include acting with integrity in all matters, treating employees with respect, and maintaining the highest standards for protecting our workers. We also believe in promoting from within, which has resulted in many long-tenured employees in leadership positions throughout the Company.

Employee Health and Safety

The health and safety of our employees is a top priority at Seneca Foods. The Company complies with all national and local laws of the jurisdictions in which we operate regarding worker health and safety. In addition, we work to continuously improve our safety record with worker safety training and Seneca’s HERO (Health Environment Risk Observation) program, in which employees proactively identify and mitigate potential safety risks. At Seneca Foods, we believe that safety is everyone’s responsibility, and the HERO program reflects that commitment, with close to 100% employee participation.

The Company also conducts annual safety audits at all processing locations to ensure compliance with Seneca and OSHA safety standards. External risk management services are also consulted as part of this process. The Company’s management recognizes plants that achieve at least one million work hours or 1,000 days worked without a lost time injury to employees with the President’s “Bronze Eagle” award, which is prominently displayed at many of our processing facilities.

Employee Training and Development

Seneca Foods believes in developing internal talent and providing employees with an opportunity for education and advancement. In support of this endeavor, we have developed two key programs. SAVES (Seneca Adding Value Employee System) focuses on employee empowerment, education, and application of lean manufacturing principles. The Company’s dedicated SAVES instructors and project leaders educate employees and empower them to make process improvements at all of our processing facilities. GROWS (Get Rid of Waste Systemically) supports our leadership development efforts through continuous improvement project leadership.

Diversity, Equity and Inclusion

Seneca Foods believes that everyone should feel respected and welcome in our workplace. The Company is committed to providing equal opportunity in all aspects of employment, and to applying fair labor practices while respecting the national and local laws of the countries and communities where we have operations. The Company does not engage in or tolerate discrimination, intimidation, harassment, or any other unlawful conduct. We believe that a diverse and inclusive workforce provides the Company with the benefits of different viewpoints and perspectives, as well as a talented and innovative employee base.

Seneca Foods Corporation (“Seneca” or the “Company”) was founded in 1949 and has evolved through internal growth and strategic acquisitions into a leading provider of packaged fruits and vegetables, with 26 facilities located throughout the United States. The facilities are comprised of plants for packaging, can manufacuting, seed production, a farming operation and a logistical support network. The Company also maintains warehouses which are generally located adjacent to its packaging plants. The Company is incorporated in New York with its headquarters located at 3736 South Main Street, Marion, New York and its telephone number is (315) 926-8100. Its high quality products are primarily sourced from approximately 1,400 American farms. The Company’s product offerings include canned, frozen and bottled produce, and snack chips. Its products are sold under private label as well as national and regional brands that the Company owns or licenses, including Seneca®, Libby’s®, Aunt Nellie’s®, Cherryman®, Green Valley® and READ®. The Company’s fruits and vegetables are sold nationwide by major grocery outlets, including supermarkets, mass merchandisers, limited assortment stores, club stores and dollar stores. The Company also sells its products to foodservice distributors, restaurants chains, industrial markets, other food processors, export customers in over 90 countries and federal, state and local governments for school and other food programs. Additionally, the Company packs canned and frozen vegetables under contract packing agreements.

The Company pursues acquisitions when they are strategic and financially additive and meet its overall business needs. In 73 years of operation, the Company has made over 50 strategic acquisitions, investments and alliances that have expanded its leadership in the packaged fruit and vegetable industry. The table below includes some of the acquisitions and divestitures that have been completed in recent years:

Date Significant Event March 2021 Acquisition of a processing facility in Berlin, Wisconsin for $7.1 million to aid the Company’s frozen business by expanding freezing capability and adding frozen celery production to the core fruit and vegetable business. December 2020 Divestiture of the prepared foods business, resulting in a gain of $34.8 million. The nature of the prepared foods business was not central to Seneca’s primary business and the sale allowed for the continued focus and investment in the Company’s core fruit and vegetable business. November 2020 Executed an agreement with a co-pack customer to process canned vegetables on a contractual basis, and as part of that arrangment, acquired a plant in Cambria, Wisconsin. As an additional part of the arragement, Seneca acquired two already closed facilities and the equipment therein which was relocated and utilized by existing Seneca facilities in order to improve efficiencies or expand production capacities. Any equipment that was unable to be utilized was disposed of in fiscal year 2021. The idle facilities were acquired with no plans of operation, one of which was sold during fiscal year 2022 and the remaining facility is expected be sold in fiscal year 2023. October 2019 The Company ceased production at its fruit processing plant in Sunnyside, Washington but continued to store, case and label products at this facility until late in fiscal year 2020. In February 2020, the Company invested approximately $10 million and contributed the Sunnyside facility to acquire a 49% stake in CraftAg, LLC, a newly formed company which processed hemp. During fiscal yer 2022, the Company's investment was deemed to be other-than-temporarily impaired and the carrying value of the investment was written down to $0.

The Company’s Internet address is www.senecafoods.com. The Company’s annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, are available on the Company’s web site, as soon as reasonably practicable after they are electronically filed with or furnished to the SEC. All such filings on the Company’s web site are available free of charge. Information on our website is not part of the annual report on Form 10-K.

In addition, the Company's website includes items related to corporate governance matters, including charters of various committees of the Board of Directors and the Company's Code of Business Conduct and Ethics. The Company intends to disclose on its website any amendment to or waiver of any provision of the Code of Business Conduct and Ethics that would otherwise be required to be disclosed under the rules of the SEC and NASDAQ.

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The Company has historically managed its business on the basis of three reportable food packaging segments: (1) fruits and vegetables, (2) prepared food products and (3) snack products. The other category comprises non-food packaging sales which relate to the sale of cans, ends, seed, and outside revenue from the Company's trucking and aircraft operations. During fiscal year 2021, the Company sold its prepared foods business, leaving just two reportable segments along with the other category. The Company’s food operation constituted 98% of total net sales in fiscal year 2022. Canned vegetables represented 84%, frozen vegetables represented 9%, fruit products represented 6%, and chip products represented 1% of the total food packaging net sales. Non-food packaging sales represented 2% of the Company's fiscal year 2022 net sales.

The Company’s principal products include canned vegetables, frozen vegetables, jarred fruit, and other food products. The products are sold nationwide by major grocery outlets, including supermarkets, mass merchandisers, limited assortment stores, club stores and dollar stores. Additionally, products are sold to food service distributors, restaurant chains, industrial markets, other food packagers, export customers in 90 countries, and federal, state and local governments for school and other feeding programs. Food packaging operations are primarily supported by plant locations in New York, Michigan, Oregon, Wisconsin, Washington, Idaho, Illinois, and Minnesota. Refer to the information set forth under the heading “Segment Information” in Note 14 of the Notes to Consolidated Financial Statements in Part II, Item 8, “Financial Statements and Supplementary Data”, for additional discussion about the Company’s segments.

The following table summarizes net sales by major product category for fiscal years 2022 and 2021 (in thousands):

Fiscal Year 2022 2021 Canned vegetables $ 1,135,983 $ 1,172,635 Frozen vegetables 123,895 102,197 Fruit products 84,708 88,431 Snack products 12,332 10,999 Prepared foods - 71,866 Other 28,362 21,516 $ 1,385,280 $ 1,467,644

We purchase raw materials, including raw produce, steel, ingredients and packaging materials from growers, commodity processors, steel producers and packaging suppliers. Raw materials and other input costs, such as labor, fuel, utilities and transportation, are subject to fluctuations in price attributable to a number of factors. Fluctuations in commodity prices can lead to retail price volatility and can influence consumer and trade buying patterns. The cost of raw materials, fuel, labor, distribution and other costs related to our operations can increase from time to time significantly and unexpectedly.

We experienced material net cost increases for raw materials and other input costs during fiscal year 2022. We attempt to manage cost inflation risks by locking in prices through short-term supply contracts, advance grower purchase agreements, and by implementing cost saving measures. We also attempt to offset rising input costs by raising sales prices to our customers. However, increases in the prices we charge our customers may lag behind rising input costs. Competitive pressures also may limit our ability to quickly raise prices in response to rising costs. To the extent we are unable to avoid or offset any present or future cost increases our operating results could be materially adversely affected.

The Company's most significant brand name, Libby's®, is held pursuant to a trademark license granted to the Company in March 1982 and renewable by the Company every 10 years for an aggregate period expiring in March 2081. The original licensor was Libby, McNeill & Libby, Inc., then an indirect subsidiary of Nestlé, S. A. ("Nestlé") and the license was granted in connection with the Company's purchase of certain of the licensor's canned vegetable operations in the United States. Corlib Brands Management, LTD acquired the license from Nestlé during 2006. The license is limited to vegetables which are shelf-stable, frozen, and thermally packaged, and includes the Company's major vegetable varieties – corn, peas and green beans – as well as certain other thermally packaged vegetable varieties and sauerkraut.

The Company is required to pay an annual royalty to Corlib Brands, now known as Libby's Brand Holding, Ltd., who may terminate the license for non-payment of royalty, use of the trademark in sales outside the licensed territory, failure to achieve a minimum level of sales under the licensed trademark during any calendar year or a material breach or default by the Company under the agreement (which is not cured within the specified cure period). With the purchase of Signature Fruit Company, LLC, which also uses the Libby’s® brand name, the Company re-negotiated the license agreement and created a new, combined agreement based on Libby’s® revenue dollars for fruits, vegetables, and dry beans. During fiscal year 2021, the Company and Libby’s Brand Holding, Ltd. renegotiated again to remove fruit from the license agreement. A total of $0.1 million was paid as a royalty fee for the fiscal year ended March 31, 2022.

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The Company also sells canned vegetables, frozen vegetables, jarred fruit, and other food products under several other brands for which the Company has obtained registered trademarks, including, Aunt Nellie’s®, CherryMan®, Green Valley®, READ®, Seneca®, and other regional brands.

While individual vegetables have seasonal cycles of peak production and sales, the different cycles are somewhat offsetting. Minimal food packaging occurs in the Company's last fiscal quarter ending March 31, which is the optimal time for maintenance, repairs and equipment changes in its packaging plants. The supply of commodities, current pricing, and expected new crop quantity and quality affect the timing and amount of the Company’s sales and earnings. When the seasonal harvesting periods of the Company's major vegetables are newly completed, inventories for these packaged vegetables are at their highest levels. For peas, the peak inventory time is mid-summer and for corn and green beans, the Company's highest volume vegetables, the peak inventory is in mid-autumn.

The Company’s revenues typically are highest in the second and third fiscal quarters. This is due, in part, because the Company’s fruit and vegetable sales exhibit seasonal increases in the third fiscal quarter due to increased retail demand during the holiday season. In addition, the Company sells canned and frozen vegetables to a co-pack customer on a bill and hold basis at the end of each pack cycle, which typically occurs during these quarters.

These seasonal fluctuations are illustrated in the following table, which presents certain unaudited quarterly financial information for the periods indicated (in thousands):

First Quarter Second Quarter Third Quarter Fourth Quarter Fiscal Year 2022: Net sales $ 235,042 $ 372,256 $ 445,593 $ 332,389 Gross margin 33,623 42,728 44,985 26,596 Net earnings 14,136 11,654 18,664 6,553 Revolver outstanding (at quarter end) 1,000 51,679 33,711 20,508 Fiscal Year 2021: Net sales $ 288,165 $ 390,294 $ 484,392 $ 304,793 Gross margin 48,562 48,943 77,704 56,976 Net earnings 20,706 18,105 72,460 14,829 Revolver outstanding (at quarter end) 34,406 62,611 - 1,000

In the food packaging business, an end of year sales order backlog is not considered meaningful. Traditionally, larger customers provide tentative bookings for their expected purchases for the upcoming season. These bookings are further developed as data on the expected size of the related national harvests becomes available. In general, these bookings serve as a yardstick rather than as a firm commitment, since actual harvest results can vary notably from early estimates. In actual practice, the Company has substantially all of its expected seasonal production identified to potential sales outlets before the seasonal production is completed.

Competition in the packaged food industry is substantial with brand recognition and promotion, quality, service, and pricing being the major determinants in the Company’s relative market position. The Company believes that it is a major producer of canned vegetables, frozen vegetables, and jarred fruit but some producers of these products have sales which exceed the Company's sales. The Company is aware of at least 13 competitors in the U.S. packaged fruit and vegetable industry, many of which are privately held companies.

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Environmental protection is an area that has been worked on diligently at each food packaging facility. In all locations, the Company has cooperated with federal, state, and local environmental protection authorities in developing and maintaining suitable antipollution facilities. In general, we believe our pollution control facilities are equal to or somewhat superior to those of our competitors and are within environmental protection standards. The Company does not expect any material capital expenditures to comply with environmental regulations in the near future.

There has been a broad range of proposed and promulgated state, national and international regulations aimed at reducing the effects of climate change. In the United States, there is a significant possibility that some form of regulation will be forthcoming at the federal level to address the effects of climate change. Such regulation could result in the creation of additional costs in the form of taxes, consultant expenses, the restriction of output, investments of capital to maintain compliance with laws and regulations, or required acquisition or trading of emission allowances.

In the ordinary course of its business, the Company is made a party to certain legal proceedings seeking monetary damages, including proceedings involving product liability claims, worker’s compensation and other employee claims, tort and other general liability claims, for which it carries insurance as well as patent infringement and related litigation. The Company is in a highly regulated industry and is also periodically involved in government actions for regulatory violations and other matters surrounding the manufacturing of its products, including, but not limited to, environmental, employee, and product safety issues. While it is not feasible to predict or determine the ultimate outcome of these matters, the Company does not believe that an adverse decision in any of these legal proceedings would have a material adverse impact on its financial position, results of operations, or cash flows.

As of the end of December 2021, the Company had approximately 3,000 employees of which 2,800 are full time, 100 seasonal employees work in food packaging, and 100 full time employees work in other activities. The number of employees increases by approximately 4,000 due to an increase in seasonal employees during our peak pack season.

The Company has seven collective bargaining agreements with three unions covering approximately 787 of its full-time employees. The terms of these agreements result in wages and benefits which are substantially the same for comparable positions for the Company’s non-union employees. There is one agreement that will expire in calendar 2023, three agreements that will expire in calendar 2024, one agreement that will expire in calendar 2025, one agreement that will expire in calendar 2026, and one agreement that will expire in calendar 2027.

The following table sets forth domestic and export sales (In thousands, except percentages):

Fiscal Year 2022 2021 Net sales: United States $ 1,285,540 $ 1,372,679 Export 99,740 94,965 Total net sales $ 1,385,280 $ 1,467,644 As a percentage of net sales: United States 92.8 % 93.5 % Export 7.2 % 6.5 % Total 100.0 % 100.0 %

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