WESTERVILLE, OHIO — Corrective actions taken on the company’s frozen garlic bread business following a fire at a co-manufacturer’s facility in the second quarter coupled with a successful product test with Buffalo Wild Wings helped Lancaster Colony Corp. turn in solid earnings and sales for the recently ended third quarter.
Net income in the third quarter ended March 31 totaled $27,621,000, equal to $1.01 per share on the common stock, up 91% from $14,471,000, or 53c per share, in the same period a year ago. Last year’s results were adversely affected by a multi-employer pension plan withdrawal charge that reduced income by about $11.5 million.
Net sales increased narrowly to $296,174,000 from $293,834,000.
In the nine months ended March 31, net income was $102,927,000, or $3.75 per share, up 19% from $86,827,000, or $3.17 per share, in the same period a year ago. Net sales totaled $914,755,000, up from $911,968,000.
While third-quarter sales continued to feel the affects of the supply disruption on garlic toast and lower sales for branded croutons and refrigerated dips, Lancaster Colony benefitted from a successful club test of Buffalo Wild Wings sauces, said David A. Ciesinski, president and chief executive officer.
“It (Buffalo Wild Wings sauces) performed exceptionally well,” Mr. Ciesinski told analysts during an April 26 conference call. “It exceeded our threshold. It exceeded by several-fold the club channels thresholds, and BWW was quite excited about it as well. … We have a little bit more to go, and we’re actively in discussions with our partner, BWW, about where we go from here. It’s an exciting product. It performed very, very well, and it’s one we’re excited about for a couple of reasons.
“One, it’s a great tasting product. But the other thing is it opens up optionality for us in a whole range of new categories where we feel like we have unique products, unique capabilities, and the Buffalo Wild Wings brand is just a tremendous equity.”
Meanwhile, on the food service side Lancaster Colony is seeing strong demand for its Sister Schubert’s and Reames Noodles brands.
“The Sister Schubert’s rolls that we’re selling into different food service partners that are used in sliders, some of them are becoming core menu items,” Mr. Ciesinski said. “And some are also (limited-time offerings) and they’re just performing exceptionally well for us and for those partners. So part of the business we expect to continue to grow and become more meaningful in time. On the pasta side, you’re familiar with the fact that we do have Reames Noodles, a small pasta business, and we leveraged the same assets to do some work with some food service partners.”
