Conagra Beats On Q3 Earnings, Raises FY18 EPS View

Conagra Brands, Inc. (CAG – Free Report) has reported mixed results for third-quarter fiscal 2018 (February 2018).

Earnings

In the fiscal third quarter, Conagra’s quarterly adjusted earnings from continuing operations came in at 61 cents, surpassing the Zacks Consensus Estimate of 55 cents. The bottom line also came in 27.1% higher than the year-ago tally.  

Revenues

Conagra generated net revenues of $1,994.5 million in the reported quarter, missing the Zacks Consensus Estimate of $2,010 million. However, the top line marginally exceeded the year-ago tally by 0.7%.

Segmental Details

Grocery & Snacks: The segment’s quarterly sales came in at $838.3 million, down 1.3% year over year.

Refrigerated & Frozen: Quarterly revenues were up 3.2% year over year to $688.5 million.

International: Sales of the segment came in at $223.4 million, up 8.9% year over year.

Foodservice: The segment’s quarterly revenues summed $244.3 million, down 6% year over year.

Conagra Brands Inc. Price, Consensus and EPS Surprise

Conagra Brands Inc. Price, Consensus and EPS Surprise | Conagra Brands Inc. Quote

Other Financial Fundamentals

Conagra’s cost of goods sold was up 2.6% year over year to $1,395.7 million. Selling, general and administrative (SG&A) expenses dropped 5.6% year over year to $330.2 million. Interest expenses dipped 12.7% to $39.8 million due to lower debt levels. Adjusted gross profit contracted 160 basis points (bps) to 30% during the reported quarter.

Conagra exited the fiscal third quarter with cash and cash equivalents of $132.9 million, lower than $251.4 million recorded at the end of fiscal 2017. Senior long-term debt (excluding current portion) came in at $3,037 million, up from $2,573.3 million reported as of May 28, 2017.

In the nine-month period ended fiscal 2018, Conagra generated net cash of $842.3 million from operating activities, slightly down from $846.5 million reported in the year-earlier period. Capital spent on additions of property, plant and equipment totaled $175.9 million, up 11% year over year.