US pasta maker American Italian Pasta has said it returned to profitability in the first quarter of fiscal 2005 after posting a loss in the fourth quarter of fiscal 2004.
The company said net earnings for the first quarter to 31 December were US$2.1m, or 11 cents per share, compared to net income in the year-ago quarter of $8.1m, or 44 cents per share. The company said the result was generally in line with its expectations.
“We are encouraged by the progress we made in the first quarter and our return to profitability, given the challenging industry environment and the restructuring activities of last year,” said president and chief executive Tim Webster.
“While we made significant improvements on a number of important operational and strategic fronts, we still have a lot to accomplish over the remainder of the year,” he added.
Webster said a key strategic initiative of the company’s 2005 business plan is to increase profits and margins by improving its top line through the implementation of price increases. The strategy should increase average sales prices over the course of fiscal 2005 and has a particular emphasis on the lower margin private label and ingredients businesses.
“We are pleased with the progress we are making and have not experienced any unexpected customer losses or other hurdles in the process, that would lead us to believe our pricing strategy is not prudent or achievable. We expect the price increases to become effective throughout the second fiscal quarter and to impact our results in the third and fourth quarters,” he added.