Shares of food-making giant Conagra (CAG - Get Report) fell on Thursday after the company reported fiscal fourth-quarter and full-year 2019 earnings that fell short of analysts' forecasts - less than two months after telling investors it was expecting a strong finish to its fiscal year.
Conagra shares were down nearly 12% at $25.57 in late morning trading on the New York Stock Exchange after the Chicago-based company posted fiscal fourth-quarter adjusted net income of $175 million, or 36 cents a share, vs. $196 million, or 50 cents a share, in the comparable year-earlier quarter.
Analysts polled by FactSet had been expecting earnings of 41 cents a share. Sales came in at $2.61 billion vs. $1.97 billion a year ago.
For the full fiscal year, Conagra said it earned $892 million, or $2.01 an adjusted share, up from $808.4 million, or $1.98 an adjusted share, a year earlier but below the $2.06 a share forecast by analysts polled by FactSet. Sales came in at $9.54 billion vs. $7.94 billion a year ago.
"While our results in the fourth quarter were below expectations, we did make good progress in key areas of the business," CEO Sean Connolly said in a statement, pointing to "transitory events" including increased competition as well as "isolated manufacturing-related challenges, and weak performance in our Ardent Mills joint venture."
The results painted a less-rosy picture than presented back in April.
In a presentation to investors filed with regulators at the time, Conagra CEO Sean Connolly pointed to the success of the company's Lamb Weston spinoff, its integration of Pinnacle Foods, and the recalibration of several of its iconic brands including Reddi-wip, Orville Redenbacher, Slim Jim and Chef Boy-Ar-Dee as positives driving the company's sales and earnings.
On Investor Day, we shared specifics on Conagra Brands' path forward, and detailed our iconic and emerging brands' roles in our growing portfolio. Maximizing shareholder value is a priority—learn more about our plan. https://t.co/w1BsAW2vHx pic.twitter.com/DDeT11kpCa— Conagra Brands (@ConagraBrands) May 3, 2019
Pinnacle Foods oversees three key brands: Birds Eye, Duncan Hines and Wish Bone.
For fiscal 2020, the company boosted its organic net sales growth guidance from approximately 1% to a range of 1% to 1.5%, and updated its fiscal 2020 adjusted per-share guidance to a range of between $2.08 and $2.18 "to reflect the divestiture of the Gelit business."
Excluding the adjustment for Gelit, the earnings guidance remains the same as presented to investors in April, the company said. Conagra sold the Italian frozen pasta maker at the end of May.