While frozen foods have struggled recently, there are signs they are making a comeback, with B&G’s Green Giant a prime beneficiary. A study from the University of Georgia, in partnership with the Frozen Food Foundation, showed frozen veggies are as healthy — if not more so — as fresh-stored ones. B&G said net sales of Green Giant frozen products in 2017 increased USD18.7 million, or 23.4%, benefiting from the strong performance of new innovation products.
B&G Foods reported fourth-quarter net sales of USD473.7 million, which was a 14.5% jump from the same period in 2016, according to a company release. Net income was up to USD129.9 million, compared to USD13.5 million in the fourth quarter a year ago, most of which was due to a one-time tax benefit from the corporate tax cut enacted in December. Net sales for fiscal 2017 were up about 20% to USD1.67 billion from USD1.39 billion in 2016.
B&G said it remains on the lookout for more companies and brands it can acquire. “I think acquisitions are extremely important,” Robert Cantwell, president and CEO of B&G Foods, said on a Tuesday earnings call. “It’s part of our model, and acquisitions that deliver products that today’s consumer wants. And I think that’s what we’ve done in our last number of acquisitions.”
Less-positive results were reported in the company’s Green Giant shelf-stable segment, where sales dropped by USD30.6 million, or 19.6%, because of weak consumption trends and distribution losses. Overall, base business net sales for fiscal 2017 were down 1.1% to about USD15 million, mainly due to decreased unit volume and net pricing, the company said.
Cantwell said on the earnings call that while B&G would continue to look at other acquisitions that come up in better-for-you and snacking categories popular with consumers, it was most interested in purchasing well-established brands like Pirate’s Booty, the line of baked snacks the company bought in 2013.
“When we bought Pirate’s Booty, we bought a brand that was around from I think the late ’70s, or whenever it kind of kicked in, or early ’80s. But it was a brand that had real legs on the upside, but it was a brand that was very stable for the long-term,” he said. “So certainly, those kind of brands are what we’re going to look at. But truly the real answer is we can buy another frozen brand, we can buy shelf-stable, we can buy snacks, but we want to be in categories where consumers are shopping more today, is really the goal.”
For fiscal 2018, B&G projected net sales of between USD1.72 and USD1.75 billion, which includes some accounting system changes that will reduce that total by about USD20 million. Those figures compare to 2017 full-year net sales guidance of between USD1.55 and USD1.68 billion, and which ended up coming in at USD1.67 billion, according to this latest earnings report.
