For the quarter ended Nov. 28, the company had income of $200 million, equal to 46¢ per share on the common stock, down 16% from $239 million, or 54¢ per share, during the same quarter of the previous year. Sales for the quarter were $3.161 billion, up 2% from $3.1 billion during the same quarter of the previous year.
“Several challenges impacted our results,” said Gary Rodkin, chief executive officer. “Difficult market conditions, weaker-than-planned consumer response to promotions, and higher-than-planned inflation weighed on Consumer Foods’ profits despite progress in overall unit market shares and volume. Profitability of our Commercial Foods segment was below expectations primarily due to selling and processing last year’s high-cost, unusually low-quality potato crop. In aggregate, it was a challenging quarter.
“Several factors are expected to improve year-over-year operating results in the second half of the fiscal year despite the challenging environment. Very importantly, we are increasing net pricing on a number of our products given the ongoing acceleration of cost inflation. Some price increases have recently been implemented and more are under way. We are confident that the net effect of these pricing increases will be positive despite potential modest volume decline.”
The Consumer Foods segment had an operating profit of $283.9 million during the second quarter, down 14% from $330 million during the same quarter of the previous year. The segment had sales of $2.104 billion, up 1% from $2.078 billion.
Operating profit within the Commercial Foods segment totaled $126.3 million, down 16% from $151 million during the same quarter of 2009. The segment had sales of $1.056 billion, up 3% from $1.022 billion.
For the six months ended Nov. 28, the company as a whole had net income of $347 million, or 78¢ per share, down 14% from $405 million, or 91¢ per share, during the same period of the previous year. The company had sales of $5.978 billion during the six months, down slightly from $5.986 billion during the same period of the previous year.