US: Lancaster Colony cautious despite profit growth

By: just-food.com | 29 January 2010

US dips-to-salad dressings maker Lancaster Colony yesterday (28 January) issued a cautious outlook for the next six months of its fiscal year despite a rise in first-half earnings.

The company, which makes non-food items like candles alongside grocery brands like Marzetti, booked net income of US$67.9m for the six months to the end of December - up sharply from $39.5m a year earlier. Net sales, meanwhile, inched up by 1.1% to $558m.

Operating income from Lancaster's speciality foods business jumped 42% in the second quarter to $56.1m, while the group's glassware and candles unit swung from a loss of $1m a year ago to income of $6.1m.

However, Lancaster's quarterly speciality food sales dipped 1% to $243.1m due to lower foodservice volumes.

Chairman and CEO John Gerlach, Jr. warned investors that Lancaster's second-half numbers would be less robust due to continued challenges in foodservice.

"Second half year-over-year comparative results will be less robust than the first-half comparisons as we face further pressure on foodservice sales, substantially less benefit from lower ingredient costs, and the seasonal dip in food and candle retail sales dynamics," Gerlach said.

Sectors: Baby food, Chilled foods, Commodities & ingredients, Frozen

Companies: Lancaster Colony