News Release
Conagra Brands Reports Continued Margin Expansion and EPS Growth in Second Quarter
Highlights
(all comparisons are against the year ago period, unless otherwise noted)
-
Diluted EPS from continuing operations grew 44.4% from
$0.18 to $0.26 ; adjusted diluted EPS from continuing operations grew 25.6% to$0.49 , despite the inclusion of Spicetec Flavors and Seasoning and JM Swank in the prior year.- "Adjusted" financial measures exclude the comparability items summarized at the end of this release and are non-GAAP. Please see the end of this release for reconciliations to the most directly comparable GAAP measures.
- Net sales decreased 11.5%, largely driven by the Company's continued progress in building a higher quality revenue base. The Company estimates that the impacts of divestitures and foreign exchange lowered sales by 5.5%.
- Gross margin (net sales less cost of goods sold as a percent of net sales) expanded 270 basis points, and adjusted gross margin expanded 250 basis points.
-
The Company completed the spin-off of
Lamb Weston in the quarter.Lamb Weston has been re-classified as discontinued operations for all periods presented.
CEO Perspective
He added, "We expect to improve sales growth trends in the second half
of the fiscal year as we begin to lap the pricing and trade actions we
undertook last year. Accordingly, we are reaffirming the fiscal 2017
guidance we provided at our investor day on
Total Company Results
Net sales decreased 11.5% as a result of volume declines associated with the Company's actions to build a higher quality revenue base, divestitures, and foreign exchange. The Company estimates that the impacts of divestitures and foreign exchange lowered sales by 5.5%.
As a percentage of net sales, gross profit increased 270 basis points from 28.3% to 31.0%. Adjusted gross profit as a percentage of net sales increased 250 basis points to 31.1%. The increases were driven primarily by improved price/mix, supply chain productivity, input cost favorability, and an inventory write-down in the prior year associated with exiting a non-core business in the Foodservice segment. These benefits more than offset the decline in volume and negative effects of foreign exchange.
Diluted EPS from continuing operations increased 44.4% from
Grocery & Snacks Segment
Net sales for the segment decreased 6% to
Operating profit for the segment increased 19%, and adjusted operating profit increased 18%, reflecting strong margin expansion in the quarter. Continued discipline on pricing and trade promotion, supply chain productivity, favorable input costs, and the benefits of our cost savings efforts more than offset decreased sales.
Refrigerated & Frozen Segment
Net sales for the segment decreased almost 11% to
Operating profit for the segment decreased 5%, and adjusted operating profit decreased 8%. Lower volume more than offset improved pricing actions, favorable input costs and supply chain productivity. The Company estimates that 5 points of the decline, on a reported and adjusted basis, relate to the avian flu-related benefits in the prior year.
International Segment
Net sales for the segment decreased 5% to
The segment reported an operating loss of
Foodservice Segment
Net sales for the segment decreased 1% to
Operating profit for the segment grew 56% as the business wrote down inventory in the prior year while exiting a non-core business. The Company estimates that the impact from the exited business added 52 percentage points to segment operating profit growth.
Corporate Expenses
Corporate expenses decreased 36% from
Other Items
Advertising & Promotion expense decreased 9% to
Equity method investment earnings decreased 2% to
Net interest expense decreased 32% to
Capital Allocation
In the second quarter, the Company paid a quarterly dividend of
As previously announced, the Board of Directors approved its first
dividend since the completion of the spin-off of the
The Company also repurchased approximately 2.2 million shares for
Outlook
The Company is reaffirming its fiscal year 2017 outlook. The Company
expects net sales to decrease between 4% and 5% (excluding the impacts
of divestitures), and to achieve adjusted gross margin of 30.4% to
30.6%, adjusted operating margin of 15.3% to 15.5%, and adjusted EPS of
between
The inability to predict the amount and timing of items impacting comparability makes a detailed reconciliation of these forward looking measures impracticable. Please see the end of this release for more information.
Major Items Affecting Second Quarter Fiscal 2017 EPS Comparability
Included in the
-
Approximately
$0.03 per diluted share of net expense, or$20 million pre-tax ($13 million after tax), related to restructuring plans ($2 million in cost of goods sold and$18 million in SG&A) -
Approximately
$0.09 per diluted share of net expense, or$61 million pre-tax ($39 million after tax), related to extinguishment of debt (all SG&A) -
Approximately
$0.09 per diluted share of net expense, or$44 million pre-tax ($41 million after tax), related to an impairment of goodwill in the Mexican business (all SG&A) -
Approximately
$0.02 per diluted share of net expense related to tax items associated with the Spicetec and JM Swank divestitures.
Included in the
-
Approximately
$0.19 per diluted share of net expense, or$133 million pre-tax ($82 million after tax), related to restructuring plans ($6 million in cost of goods sold,$127 million in SG&A) -
Approximately
$0.02 per diluted share of net expense related to tax items in connection with an international tax matter
Discussion of Results
A rebroadcast of the webcast and conference call will be available after
About
Note on Forward-looking Statements
This press release contains forward-looking statements within the
meaning of the federal securities laws. These forward-looking statements
are based on management's current expectations and are subject to
uncertainty and changes in circumstances. We undertake no responsibility
for updating these statements. Readers of this press release should
understand that these statements are not guarantees of performance or
results. Many factors could affect our actual financial results and
cause them to vary materially from the expectations contained in the
forward-looking statements, including those set forth in this press
release. These risks and uncertainties include, among other things: our
ability to achieve the intended benefits of the recent spin-off of our
Conagra Brands, Inc. Segment Operating Results (in millions) (unaudited) |
|||||||||||
SECOND QUARTER | |||||||||||
Thirteen weeks ended | Thirteen weeks ended | ||||||||||
November 27, 2016 | November 29, 2015 | Percent Change | |||||||||
SALES |
|||||||||||
Grocery & Snacks | $ | 853.9 | $ | 906.1 | (5.8 | )% | |||||
Refrigerated & Frozen | 740.0 | 826.8 | (10.5 | )% | |||||||
International | 211.4 | 221.3 | (4.5 | )% | |||||||
Foodservice | 283.1 | 285.0 | (0.7 | )% | |||||||
Commercial | — | 119.6 | (100.0 | )% | |||||||
Total | 2,088.4 | 2,358.8 | (11.5 | )% | |||||||
OPERATING PROFIT |
|||||||||||
Grocery & Snacks | $ | 220.3 | $ | 185.7 | 18.6 | % | |||||
Refrigerated & Frozen | 117.9 | 123.8 | (4.8 | )% | |||||||
International | (26.7 | ) | 20.1 | N/A | |||||||
Foodservice | 31.9 | 20.4 | 56.4 | % | |||||||
Commercial | (0.5 | ) | 13.0 | N/A | |||||||
Total operating profit for segments | 342.9 | 363.0 | (5.5 | )% | |||||||
Reconciliation of total operating profit to income from continuing operations before income taxes and equity method investment earnings | |||||||||||
Items excluded from segment operating profit: | |||||||||||
General corporate expense | (113.3 | ) | (178.2 | ) | (36.4 | )% | |||||
Interest expense, net | (54.1 | ) | (79.2 | ) | (31.7 | )% | |||||
Income from continuing operations before income taxes and equity method investment earnings | $ | 175.5 | $ | 105.6 | 66.2 | % |
Segment operating profit excludes general corporate expense, equity method investment earnings, and net interest expense. Management believes such amounts are not directly associated with segment performance results for the period. Management believes the presentation of total operating profit for segments facilitates period-to-period comparison of results of segment operations.
Conagra Brands, Inc. Segment Operating Results (in millions) (unaudited) |
|||||||||||
SECOND QUARTER | |||||||||||
Twenty-six weeks ended | Twenty-six weeks ended | ||||||||||
November 27, 2016 | November 29, 2015 | Percent Change | |||||||||
SALES |
|||||||||||
Grocery & Snacks | $ | 1,611.1 | $ | 1,706.6 | (5.6 | )% | |||||
Refrigerated & Frozen | 1,344.6 | 1,484.4 | (9.4 | )% | |||||||
International | 406.1 | 427.7 | (5.1 | )% | |||||||
Foodservice | 551.1 | 555.6 | (0.8 | )% | |||||||
Commercial | 71.1 | 237.5 | (70.1 | )% | |||||||
Total | 3,984.0 | 4,411.8 | (9.7 | )% | |||||||
OPERATING PROFIT |
|||||||||||
Grocery & Snacks | $ | 400.8 | $ | 325.2 | 23.2 | % | |||||
Refrigerated & Frozen | 210.1 | 204.9 | 2.5 | % | |||||||
International | (175.9 | ) | 36.6 | N/A | |||||||
Foodservice | 53.6 | 46.6 | 15.0 | % | |||||||
Commercial | 202.8 | 25.1 | 708.0 | % | |||||||
Total operating profit for segments | 691.4 | 638.4 | 8.3 | % | |||||||
Reconciliation of total operating profit to income from continuing operations before income taxes and equity method investment earnings | |||||||||||
Items excluded from segment operating profit: | |||||||||||
General corporate expense | (148.9 | ) | (255.1 | ) | (41.6 | )% | |||||
Interest expense, net | (112.3 | ) | (159.3 | ) | (29.5 | )% | |||||
Income from continuing operations before income taxes and equity method investment earnings | $ | 430.2 | $ | 224.0 | 92.1 | % |
Segment operating profit excludes general corporate expense, equity method investment earnings, and net interest expense. Management believes such amounts are not directly associated with segment performance results for the period. Management believes the presentation of total operating profit for segments facilitates period-to-period comparison of results of segment operations.
Conagra Brands, Inc. Consolidated Statements of Operations (in millions, except per share data) (unaudited) |
|||||||||||
SECOND QUARTER | |||||||||||
Thirteen weeks ended | Thirteen weeks ended | ||||||||||
November 27, 2016 | November 29, 2015 | Percent Change | |||||||||
Net sales | $ | 2,088.4 | $ | 2,358.8 | (11.5 | )% | |||||
Costs and expenses: | |||||||||||
Cost of goods sold | 1,440.9 | 1,690.8 | (14.8 | )% | |||||||
Selling, general and administrative expenses | 417.9 | 483.2 | (13.5 | )% | |||||||
Interest expense, net | 54.1 | 79.2 | (31.7 | )% | |||||||
Income from continuing operations before income taxes and equity method investment earnings | 175.5 | 105.6 | 66.2 | % | |||||||
Income tax expense | 78.4 | 43.1 | 81.9 | % | |||||||
Equity method investment earnings | 17.2 | 17.6 | (2.3 | )% | |||||||
Income from continuing operations | 114.3 | 80.1 | 42.7 | % | |||||||
Income from discontinued operations, net of tax | 11.6 | 79.2 | (85.4 | )% | |||||||
Net income | $ | 125.9 | $ | 159.3 | (21.0 | )% | |||||
Less: Net income attributable to noncontrolling interests | 3.8 | 4.4 | (13.6 | )% | |||||||
Net income attributable to Conagra Brands, Inc. | $ | 122.1 | $ | 154.9 | (21.2 | )% | |||||
Earnings per share - basic | |||||||||||
Income from continuing operations | $ | 0.26 | $ | 0.18 | 44.4 | % | |||||
Income from discontinued operations | 0.02 | 0.18 | (88.9 | )% | |||||||
Net income attributable to Conagra Brands, Inc. | $ | 0.28 | $ | 0.36 | (22.2 | )% | |||||
Weighted average shares outstanding | 437.7 | 433.8 | 0.9 | % | |||||||
Earnings per share - diluted | |||||||||||
Income from continuing operations | $ | 0.26 | $ | 0.18 | 44.4 | % | |||||
Income from discontinued operations | 0.02 | 0.17 | (88.2 | )% | |||||||
Net income attributable to Conagra Brands, Inc. | $ | 0.28 | $ | 0.35 | (20.0 | )% | |||||
Weighted average share and share equivalents outstanding | 441.3 | 437.9 | 0.8 | % |
Conagra Brands, Inc. Consolidated Statements of Operations (in millions, except per share data) (unaudited) |
|||||||||||
SECOND QUARTER | |||||||||||
Twenty-six weeks ended | Twenty-six weeks ended | ||||||||||
November 27, 2016 | November 29, 2015 | Percent Change | |||||||||
Net sales | $ | 3,984.0 | $ | 4,411.8 | (9.7 | )% | |||||
Costs and expenses: | |||||||||||
Cost of goods sold | 2,791.9 | 3,182.5 | (12.3 | )% | |||||||
Selling, general and administrative expenses | 649.6 | 846.0 | (23.2 | )% | |||||||
Interest expense, net | 112.3 | 159.3 | (29.5 | )% | |||||||
Income from continuing operations before income taxes and equity method investment earnings | 430.2 | 224.0 | 92.1 | % | |||||||
Income tax expense | 247.6 | 92.4 | 168.0 | % | |||||||
Equity method investment earnings | 30.3 | 42.1 | (28.0 | )% | |||||||
Income from continuing operations | 212.9 | 173.7 | 22.6 | % | |||||||
Income (loss) from discontinued operations, net of tax | 103.0 | (1,166.8 | ) | N/A | |||||||
Net income (loss) | $ | 315.9 | $ | (993.1 | ) | N/A | |||||
Less: Net income attributable to noncontrolling interests | 7.6 | 6.1 | 24.6 | % | |||||||
Net income (loss) attributable to Conagra Brands, Inc. | $ | 308.3 | $ | (999.2 | ) | N/A | |||||
Earnings (loss) per share - basic | |||||||||||
Income from continuing operations | $ | 0.48 | $ | 0.40 | 20.0 | % | |||||
Income (loss) from discontinued operations | 0.22 | (2.71 | ) | N/A | |||||||
Net income (loss) attributable to Conagra Brands, Inc. | $ | 0.70 | $ | (2.31 | ) | N/A | |||||
Weighted average shares outstanding | 438.4 | 432.1 | 1.5 | % | |||||||
Earnings (loss) per share - diluted | |||||||||||
Income from continuing operations | $ | 0.48 | $ | 0.40 | 20.0 | % | |||||
Income (loss) from discontinued operations | 0.22 | (2.69 | ) | N/A | |||||||
Net income (loss) attributable to Conagra Brands, Inc. | $ | 0.70 | $ | (2.29 | ) | N/A | |||||
Weighted average share and share equivalents outstanding | 442.1 | 436.7 | 1.2 | % |
Conagra Brands, Inc. Consolidated Balance Sheet (in millions) (unaudited) |
||||||||
November 27, 2016 | May 29, 2016 | |||||||
ASSETS | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 1,442.5 | $ | 798.1 | ||||
Receivables, less allowance for doubtful accounts | ||||||||
of $4.1 and $3.2 | 699.5 | 650.1 | ||||||
Inventories | 1,113.7 | 1,083.2 | ||||||
Prepaid expenses and other current assets | 89.3 | 148.6 | ||||||
Current assets of discontinued operations | — | 779.7 | ||||||
Current assets held for sale | — | 117.0 | ||||||
Total current assets | 3,345.0 | 3,576.7 | ||||||
Property, plant and equipment, net | 1,669.3 | 1,701.6 | ||||||
Goodwill | 4,248.7 | 4,396.2 | ||||||
Brands, trademarks and other intangibles, net | 1,260.9 | 1,237.2 | ||||||
Other assets | 899.4 | 905.5 | ||||||
Noncurrent assets of discontinued operations | — | 1,339.3 | ||||||
Noncurrent assets held for sale | 1.7 | 234.1 | ||||||
$ | 11,425.0 | $ | 13,390.6 | |||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
Current liabilities | ||||||||
Notes payable | $ | 6.7 | $ | 13.9 | ||||
Current installments of long-term debt | 231.0 | 559.4 | ||||||
Accounts payable | 784.1 | 706.7 | ||||||
Accrued payroll | 124.9 | 220.8 | ||||||
Other accrued liabilities | 598.7 | 567.7 | ||||||
Current liabilities of discontinued operations | — | 409.2 | ||||||
Current liabilities held for sale | — | 54.7 | ||||||
Total current liabilities | 1,745.4 | 2,532.4 | ||||||
Senior long-term debt, excluding current installments | 3,018.4 | 4,685.5 | ||||||
Subordinated debt | 195.9 | 195.9 | ||||||
Other noncurrent liabilities | 1,908.0 | 1,875.7 | ||||||
Noncurrent liabilities of discontinued operations | — | 304.8 | ||||||
Noncurrent liabilities held for sale | — | 1.5 | ||||||
Total stockholders' equity | 4,557.3 | 3,794.8 | ||||||
$ | 11,425.0 | $ | 13,390.6 |
Conagra Brands, Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows (in millions, unaudited) |
||||||||||
Twenty-six weeks ended | ||||||||||
November 27, 2016 | November 29, 2015 | |||||||||
Cash flows from operating activities: | ||||||||||
Net income (loss) | $ | 315.9 | $ | (993.1 | ) | |||||
Income (loss) from discontinued operations | 103.0 | (1,166.8 | ) | |||||||
Income from continuing operations | 212.9 | 173.7 | ||||||||
Adjustments to reconcile income from continuing operations to net cash flows from operating activities: | ||||||||||
Depreciation and amortization | 133.5 | 141.2 | ||||||||
Asset impairment charges | 211.9 | 1.7 | ||||||||
Gain on divestitures | (197.5 | ) | — | |||||||
Loss on extinguishment of debt | 60.6 | — | ||||||||
Lease cancellation expense | — | 48.5 | ||||||||
Earnings of affiliates in excess of distributions | (23.4 | ) | (41.6 | ) | ||||||
Share-based payments expense | 18.3 | 16.7 | ||||||||
Contributions to pension plans | (5.9 | ) | (6.0 | ) | ||||||
Pension benefit | (20.6 | ) | (7.9 | ) | ||||||
Other items | 23.9 | (13.7 | ) | |||||||
Change in operating assets and liabilities excluding effects of business acquisitions and dispositions: | ||||||||||
Accounts receivable | (49.2 | ) | (98.6 | ) | ||||||
Inventory | (32.2 | ) | (165.0 | ) | ||||||
Deferred income taxes and income taxes payable, net | 183.5 | (100.2 | ) | |||||||
Prepaid expenses and other current assets | 0.2 | (2.3 | ) | |||||||
Accounts payable | 71.7 | (10.2 | ) | |||||||
Accrued payroll | (95.5 | ) | (1.7 | ) | ||||||
Other accrued liabilities | (31.6 | ) | 82.0 | |||||||
Net cash flows from operating activities — continuing operations | 460.6 | 16.6 | ||||||||
Net cash flows from operating activities — discontinued operations | 81.6 | 335.5 | ||||||||
Net cash flows from operating activities | 542.2 | 352.1 | ||||||||
Cash flows from investing activities: | ||||||||||
Additions to property, plant and equipment | (118.3 | ) | (110.4 | ) | ||||||
Sale of property, plant and equipment | 11.3 | 16.2 | ||||||||
Proceeds from divestitures | 489.1 | — | ||||||||
Purchase of business and intangible assets | (108.2 | ) | (10.1 | ) | ||||||
Net cash flows from investing activities — continuing operations | 273.9 | (104.3 | ) | |||||||
Net cash flows from investing activities — discontinued operations | (123.7 | ) | (132.7 | ) | ||||||
Net cash flows from investing activities | 150.2 | (237.0 | ) | |||||||
Cash flows from financing activities: | ||||||||||
Net short-term borrowings | (7.2 | ) | 177.3 | |||||||
Repayment of long-term debt | (555.8 | ) | (254.5 | ) | ||||||
Payment of intangible asset financing arrangement | (14.9 | ) | — | |||||||
Repurchase of Conagra Brands, Inc. common shares | (170.1 | ) | — | |||||||
Cash dividends paid | (219.4 | ) | (215.0 | ) | ||||||
Exercise of stock options and issuance of other stock awards | 47.4 | 119.2 | ||||||||
Net cash flows from financing activities — continuing operations | (920.0 | ) | (173.0 | ) | ||||||
Net cash flows from financing activities — discontinued operations | 839.1 | 6.2 | ||||||||
Net cash flows from financing activities | (80.9 | ) | (166.8 | ) | ||||||
Effect of exchange rate changes on cash and cash equivalents | (3.5 | ) | (3.0 | ) | ||||||
Net change in cash and cash equivalents | 608.0 | (54.7 | ) | |||||||
Discontinued operations cash activity included above: | ||||||||||
Add: Cash balance included in assets held for sale and discontinued operations at beginning of period | 36.4 | 49.0 | ||||||||
Less: Cash balance included in assets held for sale and discontinued operations at end of period | — | 56.4 | ||||||||
Cash and cash equivalents at beginning of period | 798.1 | 134.1 | ||||||||
Cash and cash equivalents at end of period | $ | 1,442.5 | $ | 72.0 | ||||||
See notes to the condensed consolidated financial statements. |
Q2 FY17 & Q2 FY16 Diluted EPS from Continuing Operations |
||||||||||||
Q2 FY17 | Q2 FY16 | % Change | ||||||||||
Diluted EPS from continuing operations | $ | 0.26 | $ | 0.18 | 44.4 | % | ||||||
Net expense related to restructuring plans | 0.03 | 0.19 | ||||||||||
Net expense related to early extinguishment of debt | 0.09 | — | ||||||||||
Net expense related to goodwill and intangible impairment charges | 0.09 | — | ||||||||||
Net expense related to unusual tax items | 0.02 | 0.02 | ||||||||||
Diluted EPS from continuing operations, adjusted for items impacting comparability | $ | 0.49 | $ | 0.39 | 25.6 | % |
Grocery & Snacks Segment Operating Profit Reconciliation |
|||||||||||||||
(Dollars in millions) | Q2 FY17 | Q2 FY16 | % Change | ||||||||||||
Grocery and Snacks Segment Operating Profit | $ | 220.3 | $ | 185.7 | 18.6 | % | |||||||||
Net expense related to restructuring plans | 1.4 | 2.3 | |||||||||||||
Grocery and Snacks Segment Adjusted Operating Profit | $ | 221.7 | $ | 188.0 | 17.9 | % |
Refrigerated & Frozen Segment Operating Profit Reconciliation |
||||||||||||
(Dollars in millions) | Q2 FY17 | Q2 FY16 | % Change | |||||||||
Refrigerated and Frozen Segment Operating Profit | $ | 117.9 | $ | 123.8 | (4.8 | )% | ||||||
Net expense related to restructuring plans | 2.2 | 6.1 | ||||||||||
Refrigerated and Frozen Segment Adjusted Operating Profit | $ | 120.1 | $ | 129.9 | (7.5 | )% |
International Segment Operating Profit Reconciliation |
||||||||||||
(Dollars in millions) | Q2 FY17 | Q2 FY16 | % Change | |||||||||
International Segment Operating Profit (loss) | $ | (26.7 | ) | $ | 20.1 | N/A | ||||||
Net expense related to restructuring plans | 0.4 | 1.1 | ||||||||||
Net expense related to goodwill and intangible impairment charges | 43.9 | — | ||||||||||
International Segment Adjusted Operating Profit | $ | 17.6 | $ | 21.2 | (17.0 | )% |
Commercial Segment Operating Profit Reconciliation |
|||||||||||||||
(Dollars in millions) | Q2 FY17 | Q2 FY16 | % Change | ||||||||||||
Commercial Segment Operating Profit | $ | (0.5 | ) | $ | 13.0 | N/A | |||||||||
Net benefit related to gain on Spicetec sale | 0.2 | — | |||||||||||||
Net benefit related to gain on JM Swank sale | 0.3 | — | |||||||||||||
Commercial Segment Adjusted Operating Profit | $ | — | $ | 13.0 | (100.0 | )% |
Corporate Expense Reconciliation |
||||||||||||
(Dollars in millions) | Q2 FY17 | Q2 FY16 | % Change | |||||||||
Selling, general and administrative expenses | $ | 417.9 | $ | 483.2 | (13.5 | )% | ||||||
Less: selling, general and administrative expenses from reporting segments | 305.4 | 305.6 | ||||||||||
Plus: Corporate cost of goods sold | 0.8 | 0.6 | ||||||||||
Corporate expenses | $ | 113.3 | $ | 178.2 | ||||||||
Net expense related to restructuring plans | (15.8 | ) | (123.5 | ) | ||||||||
Net expense related to early extinguishment of debt | (60.6 | ) | — | |||||||||
Net expense related to hedging | (0.8 | ) | (0.6 | ) | ||||||||
Corporate adjusted expenses | $ | 36.1 | $ | 54.1 | (33.3 | )% |
Gross Margin Reconciliation |
|||||||||
Gross Margin: Gross Profit as a % of Net sales | |||||||||
Q2 FY17 | Q2 FY16 | ||||||||
Net sales | $ | 2,088.4 | $ | 2,358.8 | |||||
Cost of goods sold | 1,440.9 | 1,690.8 | |||||||
Gross Profit | $ | 647.5 | $ | 668.0 | |||||
Net expense related to restructuring plans included in cost of goods sold | 1.8 | 5.8 | |||||||
Net expense related to hedging | 0.8 | 0.6 | |||||||
Gross Profit adjusted for items impacting comparability | $ | 650.1 | $ | 674.4 | |||||
Adjusted Gross Margin | 31.1 | % | 28.6 | % | |||||
This press release includes certain non-GAAP financial measures, including adjusted diluted earnings per share from continuing operations, adjusted operating profit for certain segments, corporate adjusted expenses, adjusted gross margin and adjusted operating margin. Management considers GAAP financial measures as well as such non-GAAP financial information in its evaluation of the company's financial statements and believes these non-GAAP measures provide useful supplemental information to assess the company's operating performance and financial position. These measures should be viewed in addition to, and not in lieu of, the company's diluted earnings per share, operating performance and financial measures as calculated in accordance with GAAP.
Certain of these non-GAAP measures, such as adjusted gross margin, adjusted operating margin, and adjusted EPS, are forward-looking. Historically, the Company has excluded the impact of certain items impacting comparability, such as, but not limited to, restructuring expense, extinguishment of debt, hedging gains and losses, impairment charges and unusual tax items, from the non-GAAP financial measures it presents. Reconciliations of these forward-looking non-GAAP financial measures to the most directly comparable GAAP financial measures are not provided because the Company is unable to provide such reconciliations without unreasonable effort, due to the uncertainty and inherent difficulty of predicting the occurrence and the financial impact of such items impacting comparability and the periods in which such items may be recognized. For the same reasons, the Company is unable to address the probable significance of the unavailable information, which could be material to future results.
Hedge gains and losses are generally aggregated, and net amounts are reclassified from unallocated corporate expense to the operating segments when the underlying commodity or foreign currency being hedged is expensed in segment cost of goods sold. The Company identifies these amounts as items that impact comparability within the discussion of unallocated Corporate results.
View source version on businesswire.com: http://www.businesswire.com/news/home/20161222005130/en/
Source:
Conagra Brands, Inc.
MEDIA:
Mike Cummins, 312-549-5257
Michael.Cummins@conagra.com
or
INVESTORS:
Johan
Nystedt, 312-549-5002
ir@conagrafoods.com
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Conagra Brands to Release Fiscal 2024 Third Quarter Earnings on April 4, 2024
Conagra Brands, Inc. (NYSE: CAG) will release its fiscal 2024 third quarter ...