Pinnacle Foods has booked higher third-quarter earnings thanks to an improved operating performance and termination fees associated with its failed merger with Hillshire Brands.
Net earnings in the third quarter advanced to US$136m, compared to $40.7m in the year-ago period. The US company attributed much of the gain to the $163m break-up fee it received from Hillshire after the Jimmy Dean sausage maker abandoned its proposed tie-up with Pinnacle following a competing $8.55bn bid from Tyson Foods.
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Pinnacle also booked an increase in operating profit in the period, which rose to $246.6m, up from $84.9m in the year ago period. Excluding the termination fee and other items affecting comparability, pro-forma EBIT rose 19% to $101.9m.
Third-quarter net sales grew 9% to $624m. Pinnacle’s acquisition of the Wish-Bone brand from Unilever contributed 7.9 percentage points of the top-line growth. A 2.5% volume/mix gain was partially offset by a 1.2% drop in pricing, the group added.
Pinnacle tightened its EPS forecast range for the full year, from prior guidance of $1.70 – $1.75 to $1.71 – $1.74. The new forecast represented growth of 13% to 14% on last year’s earnings.
Shares in Pinnacle were up 1.2% at $33.76 at 11:03 ET.
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