CHICAGO – As the Hillshire Brands Co. continues to gain its footing in the marketplace following the breakup of the Sara Lee Corp., its earnings remain challenged by the effects of discontinued operations related to the separation. For the second quarter of fiscal 2013, ended Dec. 29, the company saw its net income decline 86% to $65 million, equal to 53c per share on the common stock, from $470 million, or $3.94 per share, during the same quarter of the previous year.
When only continuing operations are taken into account, the company earned $58 million, or 47c per share, during the second quarter of fiscal 2013, compared with $10 million, or 9c per share, during the second quarter of 2012.
Sales for the quarter were $1,060 million, a slight increase compared with the previous year of $1,053 million.
“Our business is continuing to perform well and I am very pleased with the progress we’re making,” said Sean Connolly, president and chief executive officer, The Hillshire Brands Co., commenting on the performance of the company’s continuing operations. “Our investment in MAP is strengthening our core brands, our innovation pipeline is becoming more robust, and we remain highly focused on managing costs. We also clearly benefited from favorable input costs, an area that we expect to become more challenging in calendar year 2013. Based on our strong first-half results, and taking into account our outlook for the rest of the year, we are raising full year e.p.s. guidance.”
The company raised its fiscal 2013 guidance to $1.60 to $1.70 per share with slightly positive sales growth for the year.
For the first two quarters of fiscal 2013, Hillshire’s net income declined 53% from $252 million, or $2.10 per share, in fiscal 2012 to $118 million, or 96c per share, in fiscal 2013.
On a continuing operations basis, net income rose to $107 million, or 87c per share, from $15 million, or 13c per share, the previous year.Sales for the first half of the year declined slightly to $2,034 million from $2,040 million during the previous year.