Can Nomad Foods Balance Rising Protein Costs with Pricing Power?

Nomad Foods Limited (NOMD) is facing increased input costs, particularly in protein categories such as chicken and red meat, with a rise in protein inflation reported for Q1 2025. This inflation is linked to heightened demand and disruptions from the Asian flu in Europe. Despite a year-over-year gross margin expansion of 90 basis points to 27.8%, adjusted EBITDA declined 1.8%, leading to revised guidance for adjusted EBITDA growth, now estimated between 0% to 2%, down from 2-4%.

The company’s pricing actions are expected to be gradual, potentially lagging behind ongoing cost inflation. This scenario raises concerns about consumer elasticity amid cost recovery efforts, particularly in the UK market, where value-seeking behaviors are prevalent. Nomad Foods has historically managed pricing to offset costs, but prolonged inflation could test its market position.

In comparison, peers such as Conagra Brands (CAG) and Lamb Weston (LW) are also grappling with similar inflationary pressures. Conagra reported a 389-basis-point decline in adjusted gross margin in Q3 2025, while Lamb Weston achieved 9% global volume growth despite a 5% decline in price/mix due to strategic pricing adjustments.