reported strong fourth-quarter numbers even though sales were flat in the food segment as a result of the Peter Pan peanut butter recall.
Earnings per share came in at 38 cents, and were negatively affected by 2 cents because of the recall. Analysts were looking for 31 cents. The total cost of the recall in fiscal 2007 was about $66 million, before taxes, or 8 cents a share.
Sales in the consumer foods segment were $1.6 billion, unchanged from a year ago. However, sales were actually up 3% excluding the divestiture of a refrigerated pizza business and the recall.
Peter Pan peanut butter was recalled in February when it was determined that some product was contaminated with salmonella. The product is expected to be back on the shelf in late July, and the company warned of increased marketing costs that will be associated with the relaunch.
Total sales for the Omaha, Neb., company were $3.3 billion for the quarter, an increase of 13.2% over last year's $2.9 billion. Sales for the full fiscal year were $12 billion, up 4.8% from $11.4 billion in 2006.
The trading and merchandising segment had a very strong quarter, with sales of $659 million compared with $359 million reported last year. Energy trading and fertilizer operations recorded their highest quarterly profits ever. Fertilizer demand was heightened because of corn crop increases.
"Volatility in commodity markets created opportunity for these operations," said CEO Gary Rodkin in a prepared statement. The company was quick to emphasize that the profitability was extraordinary. However, Rodkin noted that the result "provides real cash" and that the team "knocked the cover off the ball."
Operating profit for the food segment was $167 million, below last year's $197 million. The decline was attributed to higher advertising and promotion costs, as well as the recall.
Capital expenditures were higher for the quarter, coming in at $172 million compared with $89 million last year, as ConAgra made accelerated investments to implement quality initiatives and efficiency programs.
The stock was trading up 69 cents on Wednesday at $26.25.