Pinnacle Foods Finance has posted a fall in underlying operating profit for the first quarter of 2011 a drop in sales and higher input costs.
The US food group reported a 7% fall in EBIT when excluding the impact that costs from the 2009 acquisition of Birds Eye had on first-quarter profits last year.
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Pinnacle Foods cited lower sales and higher commodity costs, which, it said, was partially offset by improved productivity and pricing. Sales were down 8% over the quarter to $606m.
Including last year’s Birds Eye acquisition costs, EBIT reached $85m against $62m in the same period a year ago. Net profit rose to US$20.2m against $3.9m.
Pinnacle Foods said it initiated pricing actions over the first quarter in “several categories” to offset higher input cost inflation. The company said it saw “some benefit” during the first quarter but expects the primary impact to be realised over the balance of the fiscal year.
“First-quarter performance was consistent with our internal expectations which took into account the impact of the shift in the timing of Easter on our sales,” said CEO Bob Gamgort. “We launched our new product introductions in the first quarter to enable greater sales realisation during the year. Excluding those new distribution investments, we expanded gross margin during the quarter by initiating pricing actions and increasing our productivity to offset higher input costs.”
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