Fiscal Report Shows Lamb Weston and Conagra Brands Separation to Be on Track
ConAgra Foods has reported results for the fiscal 2016 third quarter that ended February 28, 2016 to be considerably above expectations.
The consumer foods segment has witnessed a significant increase, and drove strong double-digit comparable operating profit growth with a deliberate focus on price/mix, good productivity, and favorable input costs.
Commercial foods posted comparable operating profit growth in excess of 20% and expanded margins, reflecting volume increases across the segment as well as lower costs.
Lamb Weston posted good volume performance, reflecting the lapping of the impact of the West Coast port labor dispute.
Sales for the commercial foods segment that includes, among others, specialty potato products, accounted for $1.1 billion, up 6% over year-ago amounts. Sales for Lamb Weston’s potato operations grew across North America as well as in international markets, with the international sales performance for Lamb Weston being notably strong, reflecting the lapping of the impact of the West Coast port labor dispute in the year-ago period, as well as improving demand across several international markets.
Sean Connolly, CEO of ConAgra Foods commented, “Our results for the quarter exceeded our expectations as our actions to drive improved profitability continued to take hold. Our focus on improving price/mix and driving efficiencies is enabling us to enhance our overall fundamentals in both of our segments resulting in solid comparable operating profit growth and expanding operating margins.”
He continued, “With the sale of our private label business completed, we are focused on successfully executing our plans to reduce costs and deliver improved price/mix, while continuing to segment our portfolio to enable more impactful marketing and support investments to drive future innovation and deliver improved margins and shareholder value. We are on track to establish two independent segments with excellent operating foundations as we separate into two pure-play companies in the fall.”
