Costs linked to a series of acquisitions hit the bottom line of US private-label group Ralcorp Holdings during its fourth quarter.

Ralcorp, which has bought four companies in its last fiscal year, booked net income of US$41.9m for the the three months to 30 September – down from $79.9m a year earlier.

The group, which alongside its own-label businesses owns the Post cereal brand, said yesterday (9 November) that it had incurred $14.5m in M&A costs during the quarter.

However, Ralcorp also booked an impairment loss of $19.4m on a “reallocation of advertising and promotion expenditures to higher-return brands and reductions in anticipated sales-growth rates”.

Fourth-quarter net sales were up 15% at $1.13bn thanks to Ralcorp’s recent acquisitions. The company said its “base-business” net sales increased 1% to $989.8m.

Over the full year, Ralcorp’s net earnings fell 28.1% to $208.8m. Net sales climbed 4% to $4.05bn, although that was boosted by last year’s acquisition of Harvest Manor Farmers and this year’s purchase of American Italian Pasta Co. Ralcorp’s base-business net sales over the year fell 2% to $3.8bn.

Looking ahead, Ralcorp said it expects to see ingredient costs rise by $200m during the new fiscal year, net of hedges.

The company said it would look to improve efficiency to cut costs, cut trade programmes and raise prices.

For the full statement from Ralcorp, click here.