News Release
ConAgra Foods Fiscal 2016 Q3 EPS above Expectations; Strong Profit Growth and Margins for Both Segments; Completion of Private Label Sale Enables $2.15B Debt Reduction; on Track with Planned Separation into ConAgra Brands and Lamb Weston
Highlights (% cited indicates change vs. year-ago amounts, where applicable. SG&A refers to selling, general, and administrative expense, and COGS refers to cost of goods sold)
-
Diluted EPS from continuing operations as reported was
$0.41 , compared with$0.49 in the year-ago period. -
After adjusting for items impacting comparability, diluted comparable
EPS of
$0.68 this quarter was ahead of$0.59 in the year-ago period. As previously communicated, guidance for this quarter, as well as the basis for comparison in the year-ago period, included contribution from discontinued operations.-
Current quarter diluted EPS from discontinued operations
(amounting to
$0.05 as reported, and$0.11 adjusted for items impacting comparability) reflects about two months of results from the divested private label operations and includes approximately$36 million of pretax benefit, or$0.05 per diluted share of after-tax benefit, from the absence of private label-related depreciation and amortization expense. As previously discussed, this is due to the classification of the private label assets as held for sale during the quarter. The private label operations were divested during the quarter.
-
Current quarter diluted EPS from discontinued operations
(amounting to
-
Consumer Foods improved comparable operating margins by over 300 basis points and drove strong double-digit comparable operating profit growth with a deliberate focus on price/mix, good productivity, and favorable input costs. -
Commercial Foods posted comparable operating profit growth in excess of 20% and expanded margins, reflecting volume increases across the segment as well as lower costs. Lamb Weston posted good volume performance, reflecting the lapping of the impact of theWest Coast port labor dispute.
-
The company completed the divestiture of the private label business
during the quarter, receiving in excess of
$2.6 billion in proceeds. The company has utilized a significant portion of the proceeds to reduce debt by approximately$2.15 billion so far, and as part of a balanced capital allocation program plans to utilize more of the remaining proceeds for further debt reduction. The company is committed to an investment grade credit rating.
CEO Perspective:
He continued, “With the sale of our private label business completed, we are focused on successfully executing our plans to reduce costs and deliver improved price/mix, while continuing to segment our portfolio to enable more impactful marketing and support investments to drive future innovation and deliver improved margins and shareholder value. We are on track to establish two independent segments with excellent operating foundations as we separate into two pure-play companies in the fall.”
Overall Quarterly Results
For the fiscal 2016 third quarter ended
Consumer Foods Segment
Branded food items sold worldwide in retail channels.
The company has emphasized margins over volume this fiscal year as part of building a healthy foundation. In connection with this, the company has implemented changes to improve the efficiency of trade spending, increased list prices on Banquet products and other brands in connection with product improvements and selected commodity pass-through, and focused on improving mix. These factors played a significant role in the quarter’s 4% volume decline and significant margin expansion.
- Brands posting sales growth for the quarter include Marie Callender’s, Hunt’s, Slim Jim, Reddi-wip, Ro*Tel, PAM, and others.
- Other brand details are in the written Q&A document accompanying this release.
Segment operating profit was
Commercial Foods Segment
Specialty potato, seasonings, blends, flavors, and bakery products, as well as consumer branded and private label packaged food items, sold to restaurants, foodservice and commercial channels worldwide.
Sales for the
Segment operating profit of
Hedging Activities
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 net of these activities
resulted in
Other Items
-
Unallocated Corporate amounts were
$155 million of expense in the current quarter and$51 million of expense in the year-ago period. Current-quarter amounts include$3 million of hedge-related benefit, as well as$85 million of expense related to other items impacting comparability. Year-ago period amounts include$4 million of hedge-related benefit, and$3 million of other expense related to other items impacting comparability. Excluding these amounts, unallocated Corporate expense was$73 million for the current quarter and$52 million in the year-ago period; this increase principally reflects higher incentive compensation expenses. -
Equity method investment earnings were
$45 million for the current quarter and$33 million in the year-ago period, as reported. Excluding$18 million of benefit in the current quarter from the termination of a pension by a foreign equity method investment, current quarter equity method investment earnings of$27 million decreased from$33 million a year ago. The comparable decline is due to unfavorable grain market conditions impacting Ardent Mills performance. -
Net interest expense was
$77 million in the current quarter and$80 million in the year-ago period.
Capital Items
-
Dividends for the quarter totaled
$109 million versus$107 million in the year-ago period. - The company did not repurchase any shares during the quarter.
-
The company reduced debt by approximately
$2.15 billion during the quarter, as it utilized a significant portion of the proceeds from the divestiture of the private label operations. As part of balanced capital allocation, the company plans for further debt reduction, and reiterates its commitment to an investment grade credit rating. -
For the current quarter, capital expenditures for property, plant and
equipment from continuing operations were
$100 million , compared with$83 million in the year-ago period. Depreciation and amortization expense was approximately$93 million for the fiscal third quarter; this compares with a total of$92 million in the year-ago period.
Discontinued Operations:
Diluted EPS from discontinued operations (the private label operations)
in the fiscal third quarter of 2016 was
Loss per diluted share from discontinued operations in the third quarter
of fiscal 2015 was
Outlook
Given the recent divestiture of the private label business, which is classified within discontinued operations in current and prior periods, the company’s diluted EPS guidance for fiscal 2016 is now based on expectations for comparable results for continuing operations.
-
Fiscal 2016 year-to-date diluted EPS from continuing operations totals
$1.16 as reported, and$1.56 adjusted for items impacting comparability, detailed as part of the Regulation G reconciliation on page 11. -
The company expects full year fiscal 2016 diluted EPS from continuing
operations, adjusted for items impacting comparability, to be in the
range of
$2.05 - $2.07 .
Please see the Regulation G reconciliation on page 11 of this document, as well as the Q&A document accompanying this release, for details on EPS from continuing operations.
Major Items Impacting Third-quarter Fiscal 2016 EPS Comparability
Included in the
-
Approximately
$0.16 per diluted share of net expense, or$109 million pretax, related to restructuring charges.$61 million of this is classified within unallocated Corporate expense (all SG&A) and$48 million is classified within theConsumer Foods segment ($36 million COGS /$12 million SG&A). -
Approximately
$0.04 per diluted share of net expense, or$24 million pretax, related to the early extinguishment of debt (all Corporate SG&A). -
Approximately
$0.03 per diluted share, or$18 million pretax, of net benefit related to pension termination at affiliate Lamb-Weston Meijer , classified within the results of equity method investment earnings. -
Note: Comparable EPS contribution from the private label operations,
now classified as discontinued operations, was approximately
$0.11 per diluted share. Contribution from the private label operations was included in original guidance. The$0.11 per diluted share excludes$0.06 of net expense from items impacting comparability, detailed as part of the Regulation G reconciliation on page 10.
Included in the
-
Approximately
$0.03 per diluted share of net expense, or$15 million pretax, resulting from goodwill impairment charges related to the private label snacks business and now part ofConsumer Foods (all SG&A). -
Approximately
$0.02 per diluted share of net expense, or$11 million pretax, resulting from restructuring and integration costs.$8 million is classified within theConsumer Foods segment ($2 million in COGS,$6 million in SG&A), and$3 million of this is classified as unallocated Corporate expense (all SG&A). -
Approximately
$0.01 per diluted share of net benefit, or$4 million pretax, related to the mark-to-market impact of derivatives used to hedge input costs, temporarily classified in unallocated Corporate expense. 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.
Note: Prior year comparable EPS included approximately
Discussion of Results
A rebroadcast of the conference call will be available after
About
Note on Forward-looking Statements
This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. These
forward-looking statements are based on management’s current
expectations and are subject to uncertainty and changes in
circumstances. These risks and uncertainties include, among other
things: ConAgra Foods’ ability to successfully complete the spin-off of
its Lamb Weston business on a tax-free basis, within the expected time
frame or at all; ConAgra Foods’ ability to execute its operating and
restructuring plans and achieve its targeted operating efficiencies,
cost-saving initiatives, and trade optimization programs; ConAgra Foods’
ability to successfully execute its long-term value creation strategy;
ConAgra Foods’ ability to realize the synergies and benefits
contemplated by the Ardent Mills joint venture; risks and uncertainties
associated with intangible assets, including any future goodwill or
intangible assets impairment charges; the availability and prices of raw
materials, including any negative effects caused by inflation or weather
conditions; the effectiveness of ConAgra Foods’ product pricing efforts,
whether through pricing actions or changes in promotional strategies;
the ultimate outcome of litigation, including litigation related to the
lead paint and pigment matters and the accident at its former Garner
plant; future economic circumstances; industry conditions; the
effectiveness of ConAgra Foods’ hedging activities, including volatility
in commodities that could negatively impact ConAgra Foods’ derivative
positions and, in turn, ConAgra Foods’ earnings; the success of ConAgra
Foods’ innovation and marketing investments; the competitive environment
and related market conditions; the ultimate impact of any ConAgra Foods’
product recalls; access to capital; actions of governments and
regulatory factors affecting ConAgra Foods’ businesses, including the
Patient Protection and Affordable Care Act; the amount and timing of
repurchases of ConAgra Foods’ common stock and debt, if any; the costs,
disruption and diversion of management’s attention associated with
campaigns commenced by activist investors; and other risks described in
ConAgra Foods’ reports filed with the
Regulation G Disclosure
Below is a reconciliation of Q3 FY16 and Q3 FY15 diluted earnings per
share from continuing operations, and
Q3 FY16 & Q3 FY15 Diluted EPS from Continuing Operations | ||||||||||||
Q3 FY16 | Q3 FY15 | % change | ||||||||||
Diluted EPS from continuing operations | $ | 0.41 | $ | 0.49 | -16 | % | ||||||
Items impacting comparability: | ||||||||||||
Net expense related to restructuring charges | 0.16 | 0.02 | ||||||||||
Net expense related to debt tender offer | 0.04 | - | ||||||||||
Net benefit related to Lamb Weston pension plan settlement | (0.03 | ) | - | |||||||||
Net expense related to goodwill impairment charges | - | 0.03 | ||||||||||
Net benefit related to unallocated mark-to-market impact of derivatives | - | (0.01 | ) | |||||||||
Rounding | (0.01 | ) | - | |||||||||
Diluted EPS from continuing operations, adjusted for items impacting comparability | $ | 0.57 | $ | 0.53 | ||||||||
Net EPS contribution subsequently reclassified to discontinued operations (included in guidance/base)*: | $ | 0.11 | $ | 0.06 | ||||||||
Diluted EPS, adjusted for items impacting comparability | $ | 0.68 | $ | 0.59 | 15 | % | ||||||
Consumer Foods Segment Operating Profit Reconciliation | ||||||||||||
(Dollars in millions) | Q3 FY16 | Q3 FY15 | % change | |||||||||
Consumer Foods Segment Operating Profit | $ | 291 | $ | 266 | 9 | % | ||||||
Net expense related to restructuring charges | 48 | 8 | ||||||||||
Net expense related to goodwill impairment charges | - | 15 | ||||||||||
Consumer Foods Segment Adjusted Operating Profit | $ | 339 | $ | 289 | 17 | % | ||||||
Q3 FY16 | Q3 FY15 | |||||||||||
*Diluted EPS from discontinued operations | $ | 0.05 | $ | (2.70 | ) | |||||||
Items impacting comparability: | ||||||||||||
Net expense related to impairment charges | $ | 0.05 | $ | 2.75 | ||||||||
Net expense related to extinguishment of debt | 0.01 | - | ||||||||||
Net expense related to unusual tax matters | 0.01 | - | ||||||||||
Net expense related to restructuring charges | - | 0.01 | ||||||||||
Rounding | (0.01 | ) | - | |||||||||
Diluted EPS from discontinued operations, adjusted for items impacting comparability | $ | 0.11 | $ | 0.06 | ||||||||
Regulation G Disclosure (cont.)
Below is a reconciliation of the thirty-nine weeks ended
Thirty-nine | |||||
weeks ended | |||||
Feb. 28. 2016* | |||||
Diluted EPS from continuing operations | $ | 1.16 | |||
Items impacting comparability: | |||||
Net expense related to restructuring charges | 0.37 | ||||
Net expense related to debt tender offer | 0.04 | ||||
Net benefit related to Lamb Weston pension plan settlement | (0.03 | ) | |||
Net expense related to unusual tax matters | 0.02 | ||||
Diluted EPS from continuing operations, adjusted for items impacting comparability | $ | 1.56 | |||
Full Year | |||||
FY15* | |||||
Diluted EPS from continuing operations | $ | 1.73 | |||
Items impacting comparability: | |||||
Net expense related to restructuring and integration costs (including acquisition-related restructuring) | 0.08 | ||||
Net expense related to impairment of goodwill and other intangible assets | 0.05 | ||||
Net expense related to unallocated mark-to-market impact of derivatives | 0.05 | ||||
Net expense related to extinguishment of debt | 0.04 | ||||
Net benefit related to historical legal matters | (0.02 | ) | |||
Net expense related to year-end remeasurement of pensions | 0.01 | ||||
Net benefit related to unusual tax matters | (0.01 | ) | |||
Diluted EPS from continuing operations, adjusted for items impacting comparability | $ | 1.93 | |||
*Please see written Q&A document for quarterly details. | |||||
ConAgra Foods, Inc. | ||||||||||||
Segment Operating Results | ||||||||||||
(in millions) | ||||||||||||
(unaudited) | ||||||||||||
THIRD QUARTER | ||||||||||||
Thirteen weeks ended | Thirteen weeks ended | |||||||||||
February 28, 2016 | February 22, 2015 | Percent Change | ||||||||||
SALES |
||||||||||||
Consumer Foods | $ | 1,854.8 | $ | 1,899.7 | (2.4 | )% | ||||||
Commercial Foods | 1,069.3 | 1,007.6 | 6.1 | % | ||||||||
Total | 2,924.1 | 2,907.3 | 0.6 | % | ||||||||
OPERATING PROFIT |
||||||||||||
Consumer Foods | $ | 291.3 | $ | 266.0 | 9.5 | % | ||||||
Commercial Foods | 175.0 | 144.5 | 21.1 | % | ||||||||
Total operating profit for segments | 466.3 | 410.5 | 13.6 | % | ||||||||
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 | (155.5 | ) | (50.8 | ) | 206.1 | % | ||||||
Interest expense, net | (76.9 | ) | (79.8 | ) | (3.6 | )% | ||||||
Income from continuing operations before income taxes and equity method investment earnings | $ | 233.9 | $ | 279.9 | (16.4 | )% | ||||||
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 Foods, Inc. | ||||||||||||
Segment Operating Results | ||||||||||||
(in millions) | ||||||||||||
(unaudited) | ||||||||||||
THIRD QUARTER | ||||||||||||
Thirty-nine weeks | Thirty-nine weeks | |||||||||||
ended | ended | |||||||||||
February 28, 2016 | February 22, 2015 | Percent Change | ||||||||||
SALES |
||||||||||||
Consumer Foods | $ | 5,531.6 | $ | 5,642.0 | (2.0 | )% | ||||||
Commercial Foods | 3,283.8 | 3,169.5 | 3.6 | % | ||||||||
Total | 8,815.4 | 8,811.5 | — | % | ||||||||
OPERATING PROFIT |
||||||||||||
Consumer Foods | $ | 857.8 | $ | 758.9 | 13.0 | % | ||||||
Commercial Foods | 477.7 | 412.2 | 15.9 | % | ||||||||
Total operating profit for segments | 1,335.5 | 1,171.1 | 14.0 | % | ||||||||
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 | (425.3 | ) | (248.2 | ) | 71.4 | % | ||||||
Interest expense, net | (236.8 | ) | (241.8 | ) | (2.1 | )% | ||||||
Income from continuing operations before income taxes and equity method investment earnings | $ | 673.4 | $ | 681.1 | (1.1 | )% | ||||||
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 Foods, Inc. | ||||||||||||
Consolidated Statements of Operations | ||||||||||||
(in millions) | ||||||||||||
(unaudited) | ||||||||||||
THIRD QUARTER | ||||||||||||
Thirteen weeks | Thirteen weeks | |||||||||||
ended | ended | |||||||||||
February 28, 2016 | February 22, 2015 | Percent Change | ||||||||||
Net sales | $ | 2,924.1 | $ | 2,907.3 | 0.6 | % | ||||||
Costs and expenses: | ||||||||||||
Cost of goods sold | 2,123.7 | 2,187.3 | (2.9 | )% | ||||||||
Selling, general and administrative expenses | 489.6 | 360.3 | 35.9 | % | ||||||||
Interest expense, net | 76.9 | 79.8 | (3.6 | )% | ||||||||
Income from continuing operations before income taxes and equity method investment earnings | 233.9 | 279.9 | (16.4 | )% | ||||||||
Income tax expense | 91.0 | 100.6 | (9.5 | )% | ||||||||
Equity method investment earnings | 44.7 | 33.0 | 35.5 | % | ||||||||
Income from continuing operations | 187.6 | 212.3 | (11.6 | )% | ||||||||
Income (loss) from discontinued operations, net of tax | 18.7 | (1,165.0 | ) | N/A | ||||||||
Net income (loss) | $ | 206.3 | $ | (952.7 | ) | N/A | ||||||
Less: Net income attributable to noncontrolling interests | 1.7 | 1.4 | 21.4 | % | ||||||||
Net income (loss) attributable to ConAgra Foods, Inc. | $ | 204.6 | $ | (954.1 | ) | N/A | ||||||
Earnings (loss) per share - basic | ||||||||||||
Income from continuing operations | $ | 0.42 | $ | 0.49 | (14.3 | )% | ||||||
Income (loss) from discontinued operations | 0.04 | (2.72 | ) | N/A | ||||||||
Net income (loss) attributable to ConAgra Foods, Inc. | $ | 0.46 | $ | (2.23 | ) | N/A | ||||||
Weighted average shares outstanding | 435.7 | 427.1 | 2.0 | % | ||||||||
Earnings (loss) per share - diluted | ||||||||||||
Income from continuing operations | $ | 0.41 | $ | 0.49 | (16.3 | )% | ||||||
Income (loss) from discontinued operations | 0.05 | (2.70 | ) | N/A | ||||||||
Net income (loss) attributable to ConAgra Foods, Inc. | $ | 0.46 | $ | (2.21 | ) | N/A | ||||||
Weighted average share and share equivalents outstanding | 439.6 | 432.3 | 1.7 | % | ||||||||
ConAgra Foods, Inc. | ||||||||||||
Consolidated Statements of Operations | ||||||||||||
(in millions) | ||||||||||||
(unaudited) | ||||||||||||
THIRD QUARTER | ||||||||||||
Thirty-nine weeks | Thirty-nine weeks | |||||||||||
ended | ended | |||||||||||
February 28, 2016 | February 22, 2015 | Percent Change | ||||||||||
Net sales | $ | 8,815.4 | $ | 8,811.5 | — | % | ||||||
Costs and expenses: | ||||||||||||
Cost of goods sold | 6,485.5 | 6,742.5 | (3.8 | )% | ||||||||
Selling, general and administrative expenses | 1,419.7 | 1,146.1 | 23.9 | % | ||||||||
Interest expense, net | 236.8 | 241.8 | (2.1 | )% | ||||||||
Income from continuing operations before income taxes and equity method investment earnings | 673.4 | 681.1 | (1.1 | )% | ||||||||
Income tax expense | 259.3 | 247.9 | 4.6 | % | ||||||||
Equity method investment earnings | 107.0 | 92.6 | 15.6 | % | ||||||||
Income from continuing operations | 521.1 | 525.8 | (0.9 | )% | ||||||||
Loss from discontinued operations, net of tax | (1,307.9 | ) | (978.1 | ) | 33.7 | % | ||||||
Net loss | $ | (786.8 | ) | $ | (452.3 | ) | 74.0 | % | ||||
Less: Net income attributable to noncontrolling interests | 7.8 | 9.5 | (17.9 | )% | ||||||||
Net loss attributable to ConAgra Foods, Inc. | $ | (794.6 | ) | $ | (461.8 | ) | 72.1 | % | ||||
Earnings (loss) per share - basic | ||||||||||||
Income from continuing operations | $ | 1.17 | $ | 1.21 | (3.3 | )% | ||||||
Loss from discontinued operations | (3.01 | ) | (2.30 | ) | 30.9 | % | ||||||
Net loss attributable to ConAgra Foods, Inc. | $ | (1.84 | ) | $ | (1.09 | ) | 68.8 | % | ||||
Weighted average shares outstanding | 433.3 | 425.5 | 1.8 | % | ||||||||
Earnings (loss) per share - diluted | ||||||||||||
Income from continuing operations | $ | 1.16 | $ | 1.20 | (3.3 | )% | ||||||
Loss from discontinued operations | (2.99 | ) | (2.27 | ) | 31.7 | % | ||||||
Net loss attributable to ConAgra Foods, Inc. | $ | (1.83 | ) | $ | (1.07 | ) | 71.0 | % | ||||
Weighted average share and share equivalents outstanding | 437.6 | 430.8 | 1.6 | % | ||||||||
ConAgra Foods, Inc. | ||||||||
Consolidated Balance Sheet | ||||||||
(in millions) | ||||||||
(unaudited) | ||||||||
February 28, 2016 | May 31, 2015 | |||||||
ASSETS | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 502.6 | $ | 164.7 | ||||
Receivables, less allowance for doubtful accounts | ||||||||
of $4.7 and $4.1 | 849.6 | 773.6 | ||||||
Inventories | 1,835.5 | 1,711.9 | ||||||
Prepaid expenses and other current assets | 335.6 | 273.2 | ||||||
Current assets held for sale | 4.2 | 744.3 | ||||||
Total current assets | 3,527.5 | 3,667.7 | ||||||
Property, plant and equipment, net | 2,645.7 | 2,687.7 | ||||||
Goodwill | 4,682.2 | 4,699.5 | ||||||
Brands, trademarks and other intangibles, net | 1,371.8 | 1,313.4 | ||||||
Other assets | 960.0 | 927.0 | ||||||
Noncurrent assets held for sale | — | 4,246.9 | ||||||
$ | 13,187.2 | $ | 17,542.2 | |||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
Current liabilities | ||||||||
Notes payable | $ | 36.6 | $ | 7.9 | ||||
Current installments of long-term debt | 560.4 | 1,008.0 | ||||||
Accounts payable | 1,007.8 | 1,138.8 | ||||||
Accrued payroll | 213.1 | 211.2 | ||||||
Other accrued liabilities | 797.7 | 650.3 | ||||||
Current liabilities held for sale | — | 294.0 | ||||||
Total current liabilities | 2,615.6 | 3,310.2 | ||||||
Senior long-term debt, excluding current installments | 4,706.8 | 6,693.0 | ||||||
Subordinated debt | 195.9 | 195.9 | ||||||
Other noncurrent liabilities | 1,935.8 | 2,022.1 | ||||||
Noncurrent liabilities held for sale | 0.6 | 711.0 | ||||||
Total stockholders' equity | 3,732.5 | 4,610.0 | ||||||
$ | 13,187.2 | $ | 17,542.2 | |||||
ConAgra Foods, Inc. and Subsidiaries |
|||||||||
Condensed Consolidated Statements of Cash Flows | |||||||||
(in millions) (unaudited) |
|||||||||
Thirty-nine weeks ended | |||||||||
Feb. 28, 2016 | Feb. 22, 2015 | ||||||||
Cash flows from operating activities: | |||||||||
Net loss | $ | (786.8 | ) | $ | (452.3 | ) | |||
Loss from discontinued operations | (1,307.9 | ) | (978.1 | ) | |||||
Income from continuing operations | 521.1 | 525.8 | |||||||
Adjustments to reconcile income from continuing operations to net cash flows from operating activities: | |||||||||
Depreciation and amortization | 281.7 | 283.8 | |||||||
Asset impairment charges | 8.4 | 24.7 | |||||||
Lease cancellation expense | 55.6 | — | |||||||
Loss on extinguishment of debt | 23.9 | 24.6 | |||||||
Earnings of affiliates in excess of distributions | (31.9 | ) | (56.7 | ) | |||||
Share-based payments expense | 54.3 | 42.9 | |||||||
Contributions to pension plans | (9.3 | ) | (9.4 | ) | |||||
Pension expense (benefit) | 25.6 | (6.9 | ) | ||||||
Other items | 4.6 | 15.2 | |||||||
Change in operating assets and liabilities excluding effects of business acquisitions and dispositions: | |||||||||
Accounts receivable | (127.7 | ) | 18.9 | ||||||
Inventory | (121.4 | ) | (245.0 | ) | |||||
Deferred income taxes and income taxes payable, net | (184.2 | ) | 26.6 | ||||||
Prepaid expenses and other current assets | 1.8 | (53.5 | ) | ||||||
Accounts payable | (92.3 | ) | (25.2 | ) | |||||
Accrued payroll | 30.7 | 47.5 | |||||||
Other accrued liabilities | 60.5 | (35.5 | ) | ||||||
Net cash flows from operating activities — continuing operations | 501.4 | 577.8 | |||||||
Net cash flows from operating activities — discontinued operations | 193.7 | 162.7 | |||||||
Net cash flows from operating activities | 695.1 | 740.5 | |||||||
Cash flows from investing activities: | |||||||||
Additions to property, plant and equipment | (279.7 | ) | (240.6 | ) | |||||
Sale of property, plant and equipment | 24.6 | 15.4 | |||||||
Purchase of business, net of cash acquired | — | (74.7 | ) | ||||||
Purchase of intangible assets | (10.4 | ) | — | ||||||
Return of investment in equity method investee | — | 391.4 | |||||||
Other items | 0.3 | — | |||||||
Net cash flows from investing activities — continuing operations | (265.2 | ) | 91.5 | ||||||
Net cash flows from investing activities — discontinued operations | 2,521.6 | 40.7 | |||||||
Net cash flows from investing activities | 2,256.4 | 132.2 | |||||||
Cash flows from financing activities: | |||||||||
Net short-term borrowings | 28.7 | 284.1 | |||||||
Issuance of long-term debt | 30.0 | 550.0 | |||||||
Repayment of long-term debt | (2,521.4 | ) | (1,491.2 | ) | |||||
Repurchase of ConAgra Foods, Inc. common shares | — | (35.1 | ) | ||||||
Cash dividends paid | (323.5 | ) | (318.2 | ) | |||||
Exercise of stock options and issuance of other stock awards | 208.1 | 113.8 | |||||||
Other items | (6.2 | ) | (12.5 | ) | |||||
Net cash flows from financing activities — continuing operations | (2,584.3 | ) | (909.1 | ) | |||||
Net cash flows from financing activities — discontinued operations | (45.2 | ) | (1.7 | ) | |||||
Net cash flows from financing activities | (2,629.5 | ) | (910.8 | ) | |||||
Effect of exchange rate changes on cash and cash equivalents | (2.5 | ) | (7.7 | ) | |||||
Net change in cash and cash equivalents | 319.5 | (45.8 | ) | ||||||
Discontinued operations cash activity included above: | |||||||||
Add: Cash balance included in assets held for sale at beginning of period | 18.4 | 64.9 | |||||||
Less: Cash balance included in assets held for sale at end of period | — | 27.5 | |||||||
Cash and cash equivalents at beginning of period | 164.7 | 118.2 | |||||||
Cash and cash equivalents at end of period | $ | 502.6 | $ | 109.8 | |||||
View source version on businesswire.com: http://www.businesswire.com/news/home/20160407005241/en/
Source:
ConAgra Foods, Inc.
MEDIA:
Jon Harris,
630-857-1440
Jon.Harris@ConAgraFoods.com
or
ANALYSTS:
Chris
Klinefelter, 402-240-4154
Chris.Klinefelter@ConAgraFoods.com
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