ConAgra Brands reports 3Q results; Frozen foods boost profit

ConAgra Brands’ (CAG) – the maker of Ro-Tel and Healthy choice – efforts to change according to the varying food preferences of the customers finally paid off. The food giant had worked hard in reviving its once unpopular frozen food space. Finally, those efforts are benefiting the company as its recent third quarter profit was boosted by the frozen food sales.

The recent acquisition of Sandwich Bros – maker of frozen flatbreads – has helped ConAgra’s frozen food business evolve. During the third quarter of the fiscal year 2018, the company’s Refrigerated & Frozen segment witnessed a 3.2% jump in its net sales. The total net sales inched up marginally by 0.7% to $1.99 billion. The total net sales growth was hampered by 6% drop in the Foodservice segment.

The company posted a two-fold increase in its earnings, which rose to $362.8 million or $0.90 per share from $179.7 million or $0.41 per share during the prior year period. This increase was mainly due to the $236.7 million benefit related to the recent U.S. tax reforms.

ConAgra lifted its 2018 outlook as it offset higher commodities and shipping costs by reducing expenses and discount offers. The company now expects adjusted EPS to be in the range of $2.03 to $2.05 compared to the prior outlook of $1.84 to $1.89 per share.

While the U.S. market was bleeding in red today because of the trade war, shares of ConAgra opened with a 2% jump from yesterday’s close. When the market closed today, ConAgra was slightly up by 0.31% at $35.45, as the market weakness dragged almost all the companies.