The Chicago-based company reported Q2 EPS of $0.49, which was $0.04 better than the $0.45 that Wall Street had expected. Revenues fell 32.5% from last year, mostly due to its November spin-off Lamb Weston, to $2.09 billion. That total missed analysts’ view of $2.11 billion.
Gross margin, defined as net sales minus the cost of goods sold as a percent of net sales, expanded 270 basis points in the latest period. Adjusted gross margin gained 250 basis points.
Looking ahead, CAG reiterated its previously announced full-year EPS outlook of $1.65 to $1.70, which straddles Wall Street’s current $1.68 consensus estimate. ConAgra also said that 2017 revenues will fall 4% to 5%, which would be roughly in-line with analysts’ $7.82 billion projection.
The company commented via press release:
“We are successfully reshaping our portfolio, capabilities, and culture. Our increased focus and discipline on driving value over volume are enabling us to expand our margins as we build a higher-quality revenue base, improve efficiency, and deliver stronger, more consistent performance.”
CAG owns a number of household name food brands, including Reddi-wip, Healthy Choice, Chef Boyardee, Hebrew National, and many more. The company spun off its Lamb Weston frozen potato products business, which sells mainly to foodservice companies, into a separate public entity back in November.
ConAgra shares fell $0.20 (-0.53%) to $37.80 in premarket trading Thursday. Prior to today’s report, CAG had gained about 17% year-to-date, outpacing the 10.74% return of the benchmark S&P 500 index during the same period.
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