CHARLOTTE, N.C. — More than a fourth of the products in Snyder’s-Lance, Inc.’s portfolio are positioned as healthier options, and that number is expected to grow as the snack company continues to align itself with consumer trends.
|Carl Lee, president and c.e.o. of Snyder's-Lance.|
“Today, 27% of our portfolio is truly better-for-you items,” said Carl Lee, president and chief executive officer, during an Aug. 10 earnings call with financial analysts. “That’s up from 24% just this time last year, so a three-point increase in 12 months we consider very strong. That marches us closer and closer to our overall corporate goal of 33%, and we feel like we are on target to achieve that.”
Innovation and increased distribution contributed to growth in the second quarter ended July 4. For the period, Snyder’s-Lance had net income of $17,394,000, equal to 25c per share on the common stock, up 49% from year-ago net income of $11,698,000, or 17c per share. The results included expenses associated with legal fees related to industry-wide packaging claims. Excluding special items, the company said it had earnings per share growth of 20% year over year.
Net revenue for the quarter increased 8% to $431,428,000, which compared with prior-year revenue of $399,596,000.
To drive continued top-line growth and market share gains, Snyder’s-Lance is launching a spate of new products in the second half of the year. The company is extending its Lance Quick Starts line of breakfast sandwich crackers with such flavors as everything bagel, bacon cheddar and vanilla Greek yogurt. New from the Cape Cod brand is a line called Popcorn Duos, made with real fruit and featuring two flavors in each bag. Varieties include honey apple cinnamon and cherry cinnamon.
“…our brands are very extendable,” Mr. Lee said. “We have seen Cape Cod move into popcorn successfully. We have seen Lance move into early morning occasions with Quick Starts that once again has shown that our brands are extendable and can be used to reach additional consumer occasions and incremental consumers.”
Other new products include Snack Factory Pretzel Crisps gluten-free dark chocolate-coated miniature pretzels, Lance chipotle-flavored peanuts, and Late July jalapeño lime tortilla chips.
“We will continue to work on our product portfolio and innovation,” Mr. Lee said. “We have a robust pipeline ahead of us that we will continue to roll out for the back half of this year, 2016, and 2017 and beyond, and we will continue to focus on the very successful innovation that we are proud of over the past couple years.”
In addition to product innovation, Snyder’s-Lance is leveraging its distribution model of direct-store delivery and direct sales to support its stable of brands. The company is focused on expanding its footprint in e-commerce and convenience stores.
“I think one of the channels that is really working well and caught a lot of attention from a lot of people is e-commerce, and with our dedicated effort there, we’ve been able to continue to make some nice inroads into that channel,” Mr. Lee said. “So that’s an important example of a new channel, a growing channel, an expanding channel, one that really caters to our premium brands…
“But we still have some opportunities to continue to expand our distribution in the drug channel. We still have an opportunity to expand our distribution in C-stores, so when I talk about new outlets, it is more along the lines of those type of channels that we continue to grab more stores and reach new consumers that way.”
Net income for the first six months of the year was $27,976,000, or 40c per share, down nearly 2% from $28,493,000, or 41c per share, for the same period of the previous year. Revenue rose 8% to $290,825,000, which compared with $278,075,000.For 2015, management continues to expect net revenue to be in the range of $1.69 billion to $1.72 billion and earnings per diluted share estimated at $1.11 to $1.19.