ConAgra income jumps 61% in Q3

by Eric Schroeder
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OMAHA — ConAgra Foods, Inc. posted net income of $309,100,000 in the third quarter ended Feb. 24, equal to 63c per share on the common stock, up 61% from $192,600,000, or 38c per share, during the same period of the previous year.

Sales for the quarter were $3,528,400,000, up 21% from $2,918,400,000 during the same quarter of the previous year.

Results for the quarter were boosted by exceptionally strong performance in the Food and Ingredients and Trading and Merchandising segments, which experienced operating profit growth of 33% and 219%, respectively, during the quarter.

"Our Food and Ingredients segment had terrific results, and our Consumer Foods segment demonstrated top-line progress," said Gary Rodkin, chief executive officer. "Consumer Foods sales grew 8%, or 6% on a comparable basis, and pricing played a larger role in that segment’s sales performance."

The Consumer Foods segment posted an operating profit of $206,600,000 in the quarter, down 8% from $224,900,000 during the previous year. Sales in the quarter were $1,765,600,000, up 8% from $1,631,900,000 during the same quarter of the previous year.

The Food and Ingredients segment posted an operating profit of $143,800,000, which compared with $108,400,000 during the same quarter of the previous year. Sales for the segment were $1,034,200,000, up 24% from $837,400,000 during the previous year.

In the Trading and Merchandising segment, operating profit was $198,900,000, up sharply from $62,300,000 during the same quarter of the previous year. Sales were $563,600,000, up 92% from $293,300,000 during the same quarter of the previous year.

Also on Thursday, ConAgra announced it has agreed to sell its commodity trading and merchandising operations to the Ospraie Special Opportunities fund and other investors for approximately $2.1 billion. The transaction is expected to close in the next 60 days.

"The deal is the right strategic step for us, and the timing underscores our confidence in our core food business," Mr. Rodkin said. "While profits from the Trading and Merchandising operations have been extremely high over the past four quarters due to unprecedented volatility in commodities markets, our sole focus is on more repeatable earnings and cash flow growth from our core food operations."

The International Foods segment had an operating profit of $12,700,000, down 16% from $15,100,000 during the same quarter of the previous year. Sales for the segment were $165,000,000, up 6% from $155,800,000 during the same quarter of the previous year.

For the nine months ended Feb. 24, ConAgra posted net income of $729,300,000, or $1.49 per share, up 27% from $572,600,000, or $1.13 per share, during the same period of the previous year. Sales for the nine months were $9,995,000,000, up 15% from $8,695,700,000 during the same quarter of the previous year.

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