Oct. 7 (Reuters) – Conagra Brands Inc (CAG.N) raised its annual forecast for organic net sales and exceeded quarterly earnings expectations on Thursday, as jerky beef maker Slim Jim’s decision to increase sales the price of its frozen meals and snacks cushioned the blow. rising raw material costs.
Conagra, like its peers Campbell Soup Co (CPB.N), Kraft Heinz Co and Unilever PLC (ULVR.L), has increased product prices in recent months to offset rising raw material costs, especially edible oils, sugar and coffee amid a resurgent US economy.
The company raised its annual outlook for organic net sales, saying it now expects growth of around 1%, compared to its previous forecast of roughly stable growth.
He cited stronger-than-expected consumer demand as well as additional pricing actions planned, given high inflation levels, to elevate his sales outlook. The company raised its gross inflation expectations for the full year to around 11%, from around 9% forecast earlier.
While the home cooking trend is expected to last even as restrictions ease, Conagra and his peers would find it difficult to repeat last year’s unprecedented rise in sales, analysts said.
The Chicago-based company reported a 4.9% drop in sales of groceries and snacks in the first quarter, while sales in its frozen food division fell 2.5%, after climbing in skyrocketed last year due to a pandemic-induced increase in pantry stocks.
It posted net sales of $ 2.65 billion in the first quarter, up from $ 2.68 billion a year earlier, beating analysts’ average estimate of $ 2.54 billion, according to data from Refinitiv IBES .
Net income attributable to Conagra fell to $ 235.4 million, or 49 cents per share, in the quarter ended Aug. 29, from $ 329 million, or 67 cents per share, a year earlier.
On an adjusted basis, Conagra gained 50 cents per share, beating estimates of 49 cents per share.
Reporting by Deborah Sophia and Mehr Bedi in Bengaluru; Editing by Vinay Dwivedi
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