Post weathers difficult R.-T.-E. cereal market
by Keith Nunes
ST. LOUIS — The challenges of the ready-to-eat cereal market were reflected in the first-quarter earnings of Post Holdings, Inc. For the quarter ended Dec. 31, 2012, net income fell to $7.6 million, equal to 23c per share on the common stock. During the same period of the previous year the company recorded net income of $12.8 million, or 37c per share.
Sales for the quarter rose 8% to $236.9 million compared with $219.3 million during the previous year.
Citing Nielsen data as of Dec. 29, the company said R.-T.-E. cereal category sales were down 0.8% for the 13-weeks prior to Dec. 29 compared with the previous year. Category volumes were down 1.9%, according to Nielsen.
Post said its sales were driven by a 6% improvement in overall volumes and a 2% improvement in net selling prices. Products contributing to the improved volumes were Honey Bunches of Oats, Grape Nuts and the Pebbles product line as well as the recently introduced Good Morenings value brand.
Post management confirmed its previously provided guidance for fiscal 2013 Adjusted EBITDA to be between $210 million and $225 million, after considering the estimated year-over-year unfavorable commodity cost effect of between $10 million and $15 million.