ConAgra Foods Inc.'s (CAG) fiscal fourth-quarter earnings fell
48% on a host of charges and write-downs, with results missing
analysts' expectations as its previously strong consumer segment
weakened.
The maker of Chef Boyardee pasta, Hunt's ketchup and Peter Pan
peanut butter also forecast per-share earnings growth for the new
year of 8% to 10%, mostly concentrated in the second half of the
fiscal year. Analysts surveyed by Thomson Reuters expected 10%
growth to $1.91 a share.
Strong results from its consumer segment had been boosting
ConAgra's bottom line as the company improved margins and tacked on
market share. But those measures fell in the latest quarter, in
part on the prior-year period being a week longer.
For the quarter ended May 30, ConAgra reported a profit of $90.6
million, or 20 cents a share, down from $174.7 million, or 39
cents, a year earlier. Excluding hedging and other items, earnings
from continuing operations fell to 39 cents from 41 cents as
revenue dropped 5% to $3.06 billion.
Analysts had most recently forecast earnings of 40 cents on
$3.18 billion in revenue.
Gross margin fell to 24.1% from 25.2%.
Sales at the consumer-foods unit, ConAgra's biggest, fell 4.3%,
though the company said it estimated a 7% benefit a year ago from
the extra week. Profit slid 15% and volume dropped 4%. Meanwhile,
revenue at the commercial-foods segment declined 6.3% while profit
slumped 26%.
Shares closed at $24.69 Wednesday and were inactive premarket.
The stock has risen 23% in the past year.
-By Nathan Becker, Dow Jones Newswires; 212-416-2855; nathan.becker@dowjones.com;