US packaged food company ConAgra Foods has said a number of factors, including higher costs and production problems, are negatively impacting its earnings outlook for the third quarter to 27 February.

The company said it has experienced continued success this fiscal year across several key brands and product types due to the growth initiatives underway. At the same time, a combination of factors are negatively impacting third quarter performance.

These factors include continued weak results for ConAgra’s refrigerated branded meat operations, reflecting a spike in input costs in a difficult pricing environment. The company said production and order fulfilment issues within the retail and foodservice product segments were also causing a problem, mainly due to stronger-than-anticipated consumer demand for several items at a time when the company is making changes in its manufacturing network.

The company currently expects such operating items to negatively impact third-quarter earnings by more than US$50m after-tax, which is in the range of 10 cents per share.