US-based snack maker Lance has seen first-quarter profits plummet amid soaring flour and vegetable oil costs.
The company booked underlying operating profit of US$1.7m for the first three months of the year – compared to $9.9m a year earlier.
Revenue rose 8.5% to $198m thanks to rising crackers and potato chips sales but costs weighed on the business.
Lance had moved to increase its selling prices but not enough to offset rising costs.
President and CEO Dave Singer said: “We have executed additional pricing actions that will take effect during the second quarter. Our ingredient costs will be somewhat higher in the 2008 second quarter than in the first quarter, and based on our outlook for ingredient costs and our assessment of the competitive situation, we will continue to consider further pricing actions as the year progresses.”
Lance upped its sales forecast due to the March acquisition of Brent & Sam’s. The company held its earnings forecast firm. Earnings per diluted share are expected to reach $0.70-0.80.