Half-year profits at US food and beverage group Sara Lee have tumbled by 75% due to restructuring and impairment charges, as well as costs from its planned split.
Sara Lee, which has been buying and selling businesses in preparation for a split in two later this year, booked a 75.3% fall in net income to US$254m for the six months to 31 December.
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Adjusted net income fell less and was down 9% at $306m. From Sara Lee’s continuing operations, adjusted net income was up 24.5% at $266m.
Looking at the company’s adjusted figures, operating income increased 12% to $438m thanks to improved earnings from its coffee and tea business. Profits from its North American meat divisions fell.
Adjusted net sales were up 5.8% at $3.94bn as coffee and tea sales increased almost 13%. Net sales from its retail meats unit in North America dipped 0.8% but sales from the company’s North American foodservice and speciality meats division were up 2.8%.
For the second quarter, adjusted net income from continuing operations increased 18.4% to $158m. Adjusted operating income was up 18.4% at $256m thanks to improved earnings from Sara Lee’s North American retail meats unit and its global coffee and tea operations.
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By GlobalDataAdjusted net sales increased 5.8% to $2.04bn. Sales were up across all divisions, except Sara Lee’s North American retail meats division, which saw sales dip 0.1%.
However, CEO Marcel Smits said there had been a “marked improvement” in the volume and mix of its meat business.
Executive chairman Jan Bennink said the split of Sara Lee into a meats company and a coffee and tea supplier was on track to be completed in the first half of the year.
Last month, former Campbell Soup Co. executive Sean Connolly took charge of MeatCo, Sara Lee’s meats operations.
Former Heineken executive Michiel Herkemij, who joined Sara Lee in August to lead its international beverage operations, will become CEO of CoffeeCo, the stand-alone coffee and tea company.
