ConAgra Foods today (9 December) reduced its full-year earnings target on the back of weaker-than-expected first-half results.

The US food giant said it would lower its fiscal 2011 diluted earnings per share forecast after cutting its target for the second quarter.

ConAgra also blamed an earnings dilution resulting from the early payment of payment-in-kind notes receivable by a debtor.

Over the full fiscal year, the manufacturer of Chef Boyardee and Marie Callender’s said it now expects earnings per share to grow “in the low single digits” from the US$1.74 a share earned in fiscal 2010. Previously the company expected fiscal 2011 diluted EPS to show 5-7% comparable growth.

Additionally, it said that the second quarter diluted EPS will be lower than planned at around $0.45, as reported and on a comparable basis.

ConAgra attributed the reduction to difficult category conditions, softer than planned response to promotions, and higher than planned inflation in the consumer foods segment.

It added that weaker than expected profits from the Lamb Weston speciality potato operations also negatively impacted results.

However, ConAgra expects a year-on-year increase in operating profit during the second half due to increases in net pricing, accelerating contribution from innovation and acquired businesses, stronger second-half cost savings and improved profitability in the Lamb Weston division, driven by a higher quality potato crop.

ConAgra will report its second-quarter and half-year results on 21 December.