B&G Foods has dropped its forecast for annual sales on the back of the continued poor performance of its Rickland Orchards brand.
The US group owner expects its net sales to fall between US$865m and $875m. It had forecast net sales of from $875m to $885m.
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The revised estimate for annual sales came alongside B&G’s results for the first nine months of its financial year.
For the period to 3 October, net profit increased to $58.1m from $29.5m. Operating income rose to $123.6m from $85.8m. B&G saw its sales increase but its profitability benefited from lower interest expenses and the fact the company was lapping a period that included an impairment charge on Rickland Orchards of US$34.2m.
Net sales grew to $624.1m from $610m. However, B&G said its Rickland Orchards snack bar brand weighed on its top line. Rickland Orchards’ sales fell $17.1m compared to the first three quarters of 2014, a continuation of the performance that caused the company to impair the brand’s trademark and customer relationship intangible assets in 2014.
For the third quarter, the firm reported a net profit of $19.8m compared to last year’s loss of $4.4m, which was affected by the Rickland Orchards impairment charge. Operating profit increased to $41.6m from $4.3m.
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By GlobalDataNet sales rose to $213.3m from $208.9m.
Last month, B&G announced it had struck a deal to buy Green Giant from General Mills.
Commenting on the results, Robert Cantwell, B&G’s president and CEO, said: “We expect to continue to see margin improvements in the fourth quarter and to yet again deliver full-year company records for net sales and adjusted EBITDA. We expect to close the Green Giant acquisition during the fourth quarter. Consistent with our acquisition strategy, the acquisition is expected to be immediately accretive to our earnings per share and free cash flow. And following the completion of the Green Giant acquisition and transition, we are optimistic about future acquisition opportunities in both the shelf-stable and frozen categories.”
