US: High commodity costs weigh on Michael Foods
Michael Foods has been acquired by Post Holdings.
In a set of preliminary data for the quarter to 29 March, Michael Foods predicted EBITDA would reach US$48m, compared to US$67.2m for the same period last year.
Net sales are set to hit $474m, lower than the $484.3m Michael Foods booked last year.
President and CEO Jim Dwyer said: "Our Q1 2014 results were unfavourably impacted by record high dairy costs and high soybean meal commodity costs. Also, weather-related disruptions to our manufacturing facilities, customer distribution centres and transportation-related costs as a whole were a significant headwind for the quarter. We have announced and executed various pricing actions across our businesses to reflect the current cost environment."
Earlier today (17 April) Post announced it had struck a deal to buy Michael Foods in for US$2.45bn deal. There had been speculation in recent days that Tyson Foods was also interested in the business.
First-quarter results for Michael Foods will be announced in May. Post said it expects the takeover to go through by the end of June.
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