Landec Corporation (LNDC) slipped to a loss in the second quarter from a profit last year, due to acquisition-related expenses, higher operating expenses, the lower fair market value of its Windset investment, and an increase in interest expense. The results missed analysts’ expectations. The company lowered its earnings outlook for fiscal 2019 due to accounting for the projected loss from the acquisition of Yucatan.
Net loss was $584 million or $0.02 per share compared to a profit of $487 million or $0.02 per share in the previous year quarter.
Product sales rose by 2% to $124.9 million. This was primarily due to a 9% jump in revenues at Lifecore and a 1% rise in Landec Natural Foods revenues.
Looking ahead into fiscal 2019, the company lifted its revenue growth outlook to the range of 6% to 8% from the prior range of 5% to 7%, due to the projected revenues from Yucatan during the second half. Earnings guidance are lowered to the range of $0.25 to $0.29 per share from the prior range of $0.45 to $0.50 per share.
For fiscal 2019, Landec expects Lifecore to grow 14% to 16% range and Landec Natural Foods to grow of 5% to 7%. Cash flow from operations is anticipated to be in the $26 million to $30 million range and capital expenditures are likely to be $40 million to $45 million range.
For the third quarter, the company predicts revenues in the range of $156 million to $159 million and earnings in the range of $0.03 to $0.04 per share. The bottom line forecast reflects acquisition-related costs, additional interest expense, lower gross profit on acquired inventory from the Yucatan acquisition and integration-related expenses.
Landec currently has about $145 million of debt which translates into debt to equity ratio of about 0.57 and debt to tangible assets ratio of 0.43. The company expects leverage ratio to decline and borrowing capacity to increase by fiscal 2019 year-end as the majority of its cash flow from operations are generated in the third and fourth quarters.
Shares of Landec ended Thursday’s regular session down 3.39% at $11.41 on the Nasdaq. Following the earnings release, the stock plunged over 7% in the after-market session.
Listen to publicly listed companies’ earnings conference calls along with the edited closed caption text.
Most Popular
What to look for when CVS Health (CVS) reports Q3 earnings
Healthcare company CVS Health Corporation (NYSE: CVS) is all set to report earnings next week, with Wall Street expecting a mixed outcome. The company has been facing challenges in certain
eBay (EBAY): A few factors that helped drive growth in Q3 2024
Shares of eBay Inc. (NASDAQ: EBAY) stayed green on Friday. The stock has gained 32% year-to-date. The ecommerce leader delivered revenue and earnings growth for the third quarter of 2024,
CVX Earnings: Chevron reports lower revenue and profit for Q3 2024
Energy exploration company Chevron Corporation (NYSE: CVX) on Friday announced third-quarter 2024 financial results, reporting a decline in net profit and revenues. Net income attributable to Chevron Corporation dropped to