PARSIPPANY, N.J. — B&G Foods, Inc., posted strong sales results during the third quarter of fiscal 2017 due to the performance of such brands as Green Giant, Pirate Brands, Polaner, Underwood, New York Style and Cream of Wheat as well as acquisitions. Despite the strong sales results, earnings during the quarter remained flat compared to the same period of the previous year.
|Robert Cantwell, president and c.e.o. of B&G Foods
“Our third-quarter results were driven by solid performance across much of our portfolio, with 50% of our brands generating net sales growth in the quarter and 10 of our brands generating net sales growth in excess of 5%,” said Robert C. Cantwell, president and chief executive officer, during an Oct. 31 conference call with financial analysts.
Net income for the period ended Sept. 30 was $32,730,000, equal to 49c per share on the common stock. The year prior the company recorded earnings of $32,410,000, or 50c per share.
Sales for the quarter rose sharply to $408,364,000, which compared with $318,247,000 the year prior.
Management said increased spending related to marketing and other initiatives was one reason for the flat earnings.
Adding to the sales growth was the acquisition of the spices and seasonings business acquired from ACH Food Companies during the fourth quarter of 2016. The business unit contributed $70.4 million to sales during the quarter, ahead of management’s initial forecast by about 20%, said Bruce C. Wacha, executive vice-president of corporate strategy and business development.
Green Giant was one of B&G Foods’ best performers during the quarter, Mr. Cantwell said. Net sales of Green Giant frozen products increased 19% during the quarter, the second consecutive quarter of double-digit growth.
“Overall net sales of Green Giant increased 6.4% for the quarter, which is in line with our internal planning,” Mr. Cantwell said. “We continue to expect great things from Green Giant in the fourth quarter of 2017 and in the years ahead.
“In the third quarter of 2017, we announced that we were extending the Green Giant frozen line to include Green Giant Veggie Spirals in three varieties: zucchini, carrot and butternut squash. We expect to begin shipping these products in January 2018, and we have seen very strong retailer acceptance so far. We are also very encouraged by the feedback we are receiving from consumer testing.”
B&G Foods’ Pirate Brands business also had a strong quarter due to back-to-school sales, new distribution and effective execution during the quarter. Brand sales during the quarter increased 21%.
“We also had nice wins across the portfolio to round out the quarter, with Polaner, Underwood, New York Style and Cream of Wheat all showing incremental net sales growth of almost $1 million or more during the quarter,” Mr. Cantwell said.One brand that was challenged during the quarter was Ortega. Mr. Cantwell said the business was challenged by competition from the Old El Paso brand, which is owned by General Mills, Inc., Minneapolis.