ConAgra Foods has reported a rise in underlying first-quarter earnings despite lower sales.
A one-off gain from the merger of the US food group’s milling operations into a venture helped its bottom line on a reported basis.
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However, ConAgra’s shares rose after the Chef Boyardee pasta maker booked adjusted earnings per share that beat Wall Street expectations.
Excluding one-offs, earnings from continuing operations reached 39 cents per share for the quarter to 24 August, compared to analysts’ expectations of 35 cents thanks in part to lower interest costs.
ConAgra reported a net income of US$482.3m, up from $144.3m for the same period a year earlier. In May, the company combined its flour milling business with a venture run by Cargil and IHS, although it had to sell three mills to get the deal cleared.
Operating profit fell 4% to $353m as earnings from its private-label business slid. Revenue dipped 0.4% to $3.7bn. ConAgra’s B2B commercial foods unit was the only segment that saw sales increase.
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By GlobalDataThe company, which had a torrid 2013/14 with numerous profit warnings, reaffirmed its earnings per share forecast of mid-single digit rate of growth compared to last year’s US$2.17.
Shares in ConAgra were up 2.78% at $32.91 per share today (18 September) at 15:14 BST.
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