Conagra(CAG)2024-10-02 15:30Financial Data and Key Metrics Changes - The company reported adjusted EPS of 0.66 in the prior year, primarily due to a decline in adjusted operating profit and unfavorable foreign exchange rates [26][28] - Adjusted operating margin decreased by 244 basis points year-over-year to 14.2%, impacted by price/mix dynamics, increased cost of goods sold inflation of 3.3%, and higher SG&A expenses [24][25] Business Line Data and Key Metrics Changes - Grocery and Snacks segment delivered organic net sales of approximately 1.1 billion in net sales, down 5.7% from the prior year, with a significant impact from the Hebrew National manufacturing disruption [22][23] - The International segment achieved a 3% increase in organic net sales, driven by strong performance in Global Exports [23] Market Data and Key Metrics Changes - The company experienced a 47% decline in revenue for the Hebrew National brand in Q1 due to a manufacturing disruption, which equated to a 60 basis point reduction in total volume and a 90 basis point reduction in total organic net sales [8][21] - Approximately 71% of the company's portfolio held or gained volume share, with 93% of frozen and snack brands holding or gaining volume share during the quarter [11][12] Company Strategy and Development Direction - The company is focused on a value-over-volume strategy in Foodservice, which has helped sustain margins at pre-COVID levels despite channel softness [7] - The acquisition of FATTY Smoked Meat Sticks is part of the company's portfolio reshaping initiatives, aimed at expanding its position in the high-growth, high-margin meat sticks category [7][19] - The company plans to continue active portfolio reshaping through both acquisitions and divestitures to position itself for further growth and margin expansion [19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving fiscal 2025 goals despite challenges in the consumer environment, citing strong execution against key priorities [6][20] - The company expects sequential volume recovery each quarter and anticipates adjusted operating margin improvement to be greater in the second half of fiscal 2025 [28][29] Other Important Information - The company generated 133 million and dividends paid of 30 million for the remainder of the fiscal year [29]