Conagra Brands presented its Q4 results, showing a decrease of 2.3% in net sales and 2.4% in organic net sales when compared to the prior-year fiscal period. Meanwhile, adjusted gross profit for the quarter stood at USD803m.
In the recent three-month period, the company’s total sales dropped by 2.3%, reaching USD2.9bn. This change happened because of two main factors: a small increase (0.1%) due to foreign currency changes, and a bigger decrease (2.4%) in the company’s core sales.
The 2.4% drop in core sales was caused by two things. First, the company’s pricing and product mix had a small negative effect (0.6%), mostly because of some planned investments. Second, the company sold fewer products overall (1.8% less), mainly because people are buying less of their products lately.
The company made USD805m in profit from its sales this quarter. After some adjustments, this profit was USD803m, which is about the same as last year. They managed to keep their profit steady despite selling less and facing higher costs, thanks to being more efficient in their operations.
The company’s profit margin improved slightly. It went up to 27.7%, or 27.6% after adjustments.
Reported and organic net sales for the refrigerated & frozen segment decreased 3.8% to USD1.2bn in the quarter driven by a price/mix decrease of 4.7%, partially offset by a volume increase of 0.9%. Both price/mix and volume were driven by the impacts of our brand-building investments. In the quarter, the company gained unit share in categories such as frozen single serve meals, frozen sides, and frozen vegetables.
Operating loss for the segment was USD713m in the quarter as a result of the goodwill and brand impairment charges outlined above. Adjusted operating profit decreased 13.1% to USD190m as higher productivity was more than offset by the negative impacts of lower organic net sales, cost of goods sold inflation, and increased SG&A, a press release showed.
“Our investments in our brands continued to yield results, and again drove volume improvement in our Domestic Retail business. Progress was most notable in our key Frozen and Snacks domains, where we also saw market share gains,” according to Sean Connolly, president and chief executive officer of Conagra Brands. “Additionally, our supply chain productivity initiatives enabled us to expand adjusted gross margins, and we continued to strengthen the balance sheet and reduce our net leverage ratio. Looking ahead, we expect a gradual waning of the challenging industry trends seen throughout fiscal year 2024, as consumers adapt and establish new reference prices. We will continue to invest wisely to support our brands and facilitate that process.”
Find out more at: https://www.conagrabrands.com/