OMAHA, Neb. – ConAgra Foods Inc. (CAG), a top U.S. food producer with brands such as Butterball (search) and Chef Boyardee (search), said Thursday its fourth-quarter earnings declined 40 percent, primarily due to lower profit from its packaged-meats.
Net income fell to $101.9 million, or 20 cents per share, from $169.3 million, or 32 cents per share, in the same quarter a year ago. The latest quarter included charges of 6 cents per share related to severance costs and a change in estimated state income tax rates.
Sales fell 4 percent to $3.71 billion from $3.84 billion in last year's quarter, which included an additional week. Excluding the extra week, sales were up 4 percent in the latest period.
Analysts surveyed by Thomson Financial were looking for operating profit of 26 cents per share on sales of $3.83 billion in the latest quarter.
Sales for the Foodservice Products segment fell 7 percent to $819 million in the fourth quarter.
Fourth-quarter sales for the Food Ingredients segment rose 9 percent to $795 million, but ConAgra said a difficult cost environment and competitive conditions continued to hurt the performance of dehydrated onion, garlic, capsicums, and vegetable-based food ingredients.
ConAgra said its Food Ingredients segment will most likely post lower profits in fiscal 2006 than in fiscal 2005 due to the unusually strong 2005 performance of its trading and merchandising operations.
Looking ahead, the company said 2006 earnings per share should rise above 2005 results, excluding items, but earnings in the first quarter of 2006 are likely to fall below year-ago results of 28 cents per share. Any profit growth for fiscal 2006 is expected to be more likely in the second half of the year, ConAgra said.
Shares of ConAgra rose 22 cents, or 1 percent, to $23.32 on the New York Stock Exchange (search).
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