Packaged food company ConAgra Foods Inc. (CAG) said Wednesday that first-quarter earnings more than doubled, reflecting a large gain from selling its remaining shares in Pilgrim's Pride Corp. as well as solid performance in several areas of the business. Its shares rose more than 4 percent.

The maker of Butterball turkeys (search) and Chef Boyardee (search) foods said net income surged to $352.1 million, or 68 cents per share, in the three months ended Aug. 28, from $134.7 million, or 26 cents per share, a year ago. Sales ebbed to $3.36 billion from $3.38 billion last year.

During the quarter, ConAgra Foods sold its remaining 15.4 million shares of Pilgrim's Pride (PPC) for about $482 million, resulting in a pretax gain of about $329 million, or 40 cents per share. ConAgra Foods acquired these shares in the fall of 2003 in connection with the divestiture of its chicken-processing operations to Pilgrim's Pride.

Excluding the gain, as well as 4 cents per share of asset impairment and plant closure costs, and a penny per share of earnings from discontinued operations, ConAgra would have posted profit of 31 cents per share in the latest quarter, compared with year-ago operating earnings of 28 cents.

On average, analysts surveyed by Thomson Financial were looking for first-quarter earnings of 23 cents per share on sales of $3.47 billion.

Shares of ConAgra rose $1.01, or 4.6 percent, to $23.07 in early trading on the New York Stock Exchange, bouncing up from a recent 52-week low of $22.05.

Sales of products at retail fell 4 percent to $1.9 billion compared a year ago as 3 percent fewer products were sold. The company said price increases contributed to the declines. The retail segment comprises 58 percent of ConAgra's sales.

Sales improved for several brands, including Slim Jim, Van Camp's, Manwich and La Choy. But sales declined for several other brands, including ACT II, Banquet, Hunt's and Healthy Choice.

Operating profit from the retail products segment rose to $210.7 million from $209.8 million a year ago.

Profits also improved in ConAgra's food service and food ingredient segments, which together account for 42 percent of the company's sales.

Sales of food service products were similar to last year at $789.9 million, and profits for the segment of $79.5 million grew considerably from last year's $66.4 million.

Both sales and profits were up for food ingredients this quarter. The company reported sales of $631.4 million and profits of $76.3 million for the segment.

Bruce Rohde, chairman and CEO, said, "We are executing better in key areas of our business, and we are also encouraged by the fact that input cost inflation trends for some items are moderating following the significant cost increases we experienced in recent quarters. Fiscal 2006 should be a year of solid operating profit performance as we continue to improve our packaged meats operations and make our cost structure more efficient."

The company said it continues to expect fiscal 2006 earnings per share to be higher than fiscal 2005 results, excluding items. ConAgra said that earnings improvement is expected to be more apparent in the second half of the fiscal year as the company makes more progress in improving its packaged meats operations.

Analysts are currently predicting 2006 operating earnings of $1.40 per share, on average.

ConAgra is at a pivotal point. A new chief executive is scheduled to start next month and the company is pushing a reshaped portfolio of products that emphasizes brand names such as Chef Boyardee and Orville Redenbacher's.

Rohde, who has been chairman and chief executive since 1998, led ConAgra's transition from an agriculturally based conglomerate into a retailer of packaged food.

Gary Rodkin will succeed Rohde as CEO and become a member of the board on Oct. 1.

Board member Steven F. Goldstone has been elected nonexecutive chairman, effective Oct. 1. Goldstone is a retired chairman and chief executive officer of RJR Nabisco, and succeeds Rohde, the company's current chairman.