US: Lance cuts full-year guidance

By: just-food.com | 31 October 2008

US snack maker Lance has cut its full-year earnings outlook on the back of increasing ingredient and energy costs.

The North Carolina-based company posted third-quarter net income of $6.8m, a fall of more than 9% from a year earlier. The result was affected by ingredient cost increases, particularly for potatoes and peanuts.

Third-quarter net revenue, however, reached a "record" $225.6m during the three months to 27 September, up 14% on the year.

Nevertheless, based on its third-quarter results and an assessment of its current sales volume trends for the fourth quarter, Lance said it is narrowing its 2008 full-year net sales estimate to $840m-$850m.

"The earnings shortfall in the quarter was due to a temporary increase in our cost of potatoes and peanuts, higher than anticipated energy costs, and a temporary increase in promotional spending," said David Singer, president and CEO.

"Our potato and peanut costs are now back to normal, energy costs are declining and we have implemented sufficient pricing to offset our higher input costs."

Sectors: Bakery, Snacks

Companies: Lance