WESTERVILLE, OHIO — Record sales and higher profits highlighted a strong start to the fiscal 2024 year at Lancaster Colony Corp., company executives said.
In the first quarter ended Sept. 30, Lancaster net income totaled $43.95 million, equal to $1.60 per share on the common stock, up 17% from $37.59 million, or $1.37 per share, in the same period a year ago. Net sales were $461.57 million, up 8.4% from $425.54 million a year ago.
“The results for the quarter reflect continued top-line growth and improved gross margin performance,” Thomas K. Pigott, chief financial officer, noted in a Nov. 2 conference call with analysts. “First-quarter consolidated net sales increased by 8.5% to $461.6 million. Decomposing the revenue performance, revenue was favorably impacted by approximately 600 basis points from last year’s sales shift. Higher net pricing contributed approximately 140 basis points of growth. The remainder was driven by volume.”
Operating income for the Retail business in the first quarter was $53.12 million, up 24% from $42.9 million in the year-ago quarter. Net sales in the Retail unit increased 8.5% to $242.18 million from $223.22 million.
“In our Retail segment, net sales growth of 8.5% was led by continued strong performance of our successful program for license, sauces and dressings and another solid quarter for our New York Bakery frozen garlic bread products,” said David A. Ciesinski, chief executive officer.
Mr. Ciesinski said the New York Bakery and Sister Schubert brands increased their market share during the quarter, with New York Bakery’s share of the frozen garlic bread category growing 400 basis points to 44.3% and Sister Schubert’s share of the frozen dinner roll category increasing 80 basis points to 54.1%.
In addition to gains made by the Sister Schubert’s brand, Mr. Ciesinski said the company’s Chick-fil-A refrigerated salad dressings generated $10 million in retail sales during the first quarter.Operating income for the Foodservice segment totaled $26.33 million in the quarter, down 17% from $31.93 million in the first quarter of fiscal 2023. Quarterly net sales in the unit rose 8.4% to $219.39 million from $202.3 million. Sales growth in the Foodservice segment was driven by increased demand from many of Lancaster’s national chain accounts in addition to solid sales growth for the company’s branded foodservice products, Mr. Ciesinski said.