TreeHouse Foods, the specialty food company spun off from Dean Foods last year, has reported a rise in income from continuing operations for the second quarter, to US$0.21 per diluted share, from $0.05 per share last year.

The company said that excluding exceptional items in both 2005 and 2006, second-quarter earnings per share would have increased to $0.34 per share in 2006, from $0.31 per share in 2005.

Net sales for the second quarter rose by 25.5% to $232.1m, on the back of higher sales of soup and infant feeding products. Pickle revenues increased by 3.7% due to the acquisition of the Oxford Foods business in February 2006. Non-dairy powdered creamer sales decreased by 0.8% as private label gains were offset by branded creamer and ingredient sales declines. Other product sales grew by 5.1% due to higher co-pack revenues in the company’s refrigerated business.

Gross margin for the second quarter fell to 20.9% compared to 21.9% in the same period last year, with Treehouse attributing the decline to lower overall margins in the soup and infant feeding business.

“We continued to increase revenues, adjusted gross margin and operating income in our legacy private label and foodservice businesses,” said chairman and CEO Sam K Reed. “Operating performance improved as a combination of price increases and productivity gains outweighed energy and input cost inflation. The recently acquired soup and infant feeding segment showed strong top-line growth, even though the quarter included only nine weeks of their results.”

Reed added that the company was confident of meeting its goals for this year, and confirmed earlier guidance of earnings per share in the range of $0.86 to $0.91 for the full fiscal year.