Diamond Foods, the US snack maker behind upmarket crisp brand Kettle Chips, has lifted its full-year earnings target after first-quarter sales rose 40%.
The company said yesterday (8 December) that it now expects non-GAAP earnings per share to range from US$2.43 to $2.49, compared to its previous target, announced in October, of $2.38 to $2.48.
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Diamond’s 40% rise in first-quarter sales – which reached $252.6m – also meant the company upped its full-year sales forecast. It predicts sales will climb to $920m to $945m, up from its earlier guidance of $910m to $940m.
“We are pleased with the organic growth in our base retail business, which has been augmented by the addition of Kettle,” said chairman, president and CEO Michael Mendes. “Our strong performance gives us the confidence to further invest in our brands while increasing our sales and earnings guidance.”
Diamond’s first-quarter sales were boosted by a 58% rise in revenues from the retail channel to $227.8m. Kettle’s US dollar sales rose 11%, while in the UK, the brand’s sales climbed 10%.
Group operating income was up 7% to $27.5m despite advertising investment almost doubling. Net income dipped from $14.9m a year earlier to $14.2m due to higher interest costs. Fully diluted earnings per share for the first quarter stood at $0.64 – down from $0.88 a year earlier. On a non-GAAP basis, excluding costs linked to the Kettle acquisition in February, earnings per share reached $0.65.
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By GlobalDataClick here for the full statement from Diamond.
