ConAgra Brands (CAG) reported Q1 EPS of $0.57, $0.05 better than the analyst estimate of $0.52. Revenue for the quarter came in at $2.9 billion versus the consensus estimate of $2.84 billion.
Outlook:
The Company is reaffirming guidance provided on its fourth quarter fiscal 2022 earnings call and as detailed below. For the second quarter of fiscal 2023, the Company has planned for continued supply chain inefficiency tied to the dynamic operating environment and some incremental volume weakness tied to the new inflation-driven pricing that went into effect early in the quarter. Gross inflation (input cost inflation before the impacts of hedging and other sourcing benefits) is expected to continue but moderate through the remainder of the fiscal year, resulting in low-teen levels, and commodity relief is expected to be weighted towards the back half of the fiscal year. Despite a strong early performance from its joint venture, Ardent Mills, the Company is not planning for elevated performance to continue throughout the remainder of the fiscal year due to the volatile nature of the business.
The company's fiscal 2023 guidance remains as follows:
- Organic net sales growth is expected to be 4% to 5% compared to fiscal 2022
- Adjusted operating margin is expected to be approximately 15%
- Adjusted diluted EPS growth is expected to be 1% to 5% compared to fiscal 2022
- Capital expenditures of approximately $500M
- Interest expense of approximately $410M
- Effective tax rate of approximately 24%
- Pension income of approximately $25M