OMAHA — Net income at ConAgra Foods, Inc. fell 31% in the second quarter, reflecting the absence of contributions from the commodity trading unit the company sold earlier this year. Net income in the second quarter ended Nov. 23 totaled $168,100,000, equal to 38c per share on the common stock, down from $244,800,000, or 50c per share, in the same period a year ago. Earnings from continuing operations, which excludes last year’s contribution from the sold business, rose 27% year-over-year to $171,400,000.
Sales for the quarter were $3,264,300,000, up 11% from $2,951,200,000 during the same quarter of the previous year.
"I am pleased to reconfirm our earnings outlook for fiscal 2009 given the dynamics of the current marketplace," said Gary Rodkin, chief executive officer. "Commercial Foods continued its outstanding top- and bottom-line performance by managing volatile input costs through nimble pricing actions and operating excellence. We also substantially reduced operating costs through an over-delivery against costs savings targets in the Consumer Foods supply chain and successfully focused on S.G.&A. expenses. While comparable Consumer Foods profits were down, we are confident that changes in our merchandising, slowing inflation, and other planned operating changes will reverse this trend in the back half of the year."
The Consumer Foods segment posted an operating profit of $252,500,000 in the quarter, up 2% from $247,100,000 during the previous year. Taking into account $27 million in recall costs associated with Banquet Pot Pies, adjusted operating profit was down 8% from $274,000,000 in the second quarter of fiscal 2008.
Sales in the quarter were $2,042,800,000, up 4% from $1,956,200,000 during the same quarter of the previous year. ConAgra said the sales gain reflected price increases necessitated by higher input costs as well as a 4% decline in unit volume.
The Commercial Foods segment posted an operating profit of $155,500,000, up 18% from $131,800,000 during the same quarter of the previous year. The company attributed the gain to operating efficiencies within the flour milling business, including a favorable impact of a high-quality wheat crop. In addition, the acquisition of Lamb Weston was a significant contributor to growth.
Sales for the segment were $1,221,500,000, up 23% from $995,000,000 during the previous year. ConAgra said the sharp jump in sales during the quarter reflected increased prices driven by input cost increases for flour milling, and, to a lesser extent, the Lamb Weston specialty potato operations.
For the six months ended Nov. 23, ConAgra posted net income of $610,500,000, or $1.33 per share, up 45% from $420,200,000, or 86c per share, during the same period of the previous year. Income from continuing operations totaled $278,800,000, up 5% from $265,600,000. Sales for the six months were $6,329,900,000, up 14% from $5,572,300,000 during the same period of the previous year.