ConAgra raises 2013 earnings forecast

by Eric Schroeder
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OMAHA — ConAgra Foods, Inc. has increased its fiscal 2013 adjusted earnings per share forecast to $2.15, up from its earlier guidance of $2.06 per share and compared with analysts’ expectations of $2.12 per share. The announcement was made earlier today prior to the company’s presentation at the Consumer Analyst Group of New York’s annual conference in Boca Raton, Fla.

“This is a great time to be a part of ConAgra Foods,” said Gary Rodkin, chief executive officer. “The profitability of our core business is showing strong progress, and we have recently completed the largest acquisition in our history with the purchase of Ralcorp. The transaction is financially and strategically compelling and creates a company with $18 billion in net sales and the leading position in North America in private brands. We have already begun the integration process and look forward to reporting on our progress over the next few months.”

Given the debt utilized to purchase Ralcorp, ConAgra said it will focus on aggressive debt reduction through the end of fiscal 2015. The company plans to maintain its $1 per share dividend (annualized) throughout that period and will evaluate dividend increases once its near-term debt reduction goals have been met.

ConAgra Foods completed its purchase of Ralcorp on Jan. 30 after initially agreeing to acquire the company on Nov. 26, 2012, for $90 in cash per share of Ralcorp common stock. The transaction was valued at about $6.8 billion, including the assumption of debt.

ConAgra said it expects Ralcorp to add about 5c per share to fiscal 2013 diluted e.p.s., adjusted for items impacting comparability, and approximately 25c per share to fiscal 2014 diluted e.p.s., adjusted for items impacting comparability.

The company will offer full fiscal 2014 e.p.s. expectations, and its views on the benefits of the transaction to long-term financial goals, when it conducts its fiscal 2013 fourth-quarter earnings release this summer.
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READER COMMENTS (1)

By Stacy C 2/19/2013 3:40:49 PM
You should have took a larger position on ConAgra when I called you back in September on this! :)