Conagra(US:CAG)2024-12-19 12:32Financial Performance - Reported net sales decreased 0.4% to $3.2 billion, while organic net sales increased 0.3%[4] - Reported diluted earnings per share (EPS) was $0.59, a 1.7% decrease, and adjusted EPS was $0.70, a 1.4% decrease[4] - Net income attributable to Conagra Brands, Inc. for the thirteen weeks was $284.5 million, a slight decrease of 0.6% compared to $286.2 million[43] - Net income attributable to Conagra Brands, Inc. for the twenty-six weeks was $751.3 million, an increase of 24.0% compared to $606.1 million[44] - Basic earnings per share for the twenty-six weeks increased by 23.6% to $1.57 from $1.27[44] - Net income for the quarter ending November 24, 2024, was $751.4 million, an increase from $606.1 million in the same period last year, representing a growth of approximately 24%[46] - Adjusted diluted EPS for Q2 FY25 was $0.70, representing a year-over-year increase of 22.3%[53] - Net income attributable to Conagra Brands, Inc. for Q2 FY25 was $284.5 million, a decrease of 0.6% from $286.2 million in Q2 FY24[67] Sales and Revenue - Net sales for the Grocery & Snacks segment increased 2.0% to $1.3 billion, driven by a 1.2% increase in organic net sales[11] - Net sales for the International segment decreased 12.9% to $243 million, impacted by M&A and foreign exchange[16] - Net sales for the thirteen weeks ended November 24, 2024, were $3,195.1 million, a decrease of 0.4% compared to $3,208.1 million for the same period last year[43] - For the twenty-six weeks ended November 24, 2024, net sales were $5,990.0 million, a decrease of 2.0% from $6,112.1 million[44] - Q2 FY25 total net sales for Conagra Brands reached $3,195.1 million, a year-over-year decrease of 0.4%[47] - Organic net sales for Q2 FY25 were $3,193.7 million, reflecting a 0.3% year-over-year increase[47] - The Grocery & Snacks segment reported net sales of $1,321.0 million, with a year-over-year increase of 2.0%[47] - Year-to-date organic net sales for FY25 totaled $5,970.8 million, with a year-over-year decrease of 1.5%[47] Expenses and Costs - Cost of goods sold for the same period was $2,348.4 million, down 0.6% from $2,361.5 million[43] - Selling, general, and administrative expenses increased by 11.5% to $444.1 million from $398.1 million[43] - The company incurred restructuring plans costs of $83.8 million in Q2 FY25, compared to $27.9 million in Q2 FY24[51] - The company incurred restructuring plans expenses of $79.2 million in Q2 FY25, compared to $0.8 million in Q2 FY24[67] - Brand impairment charges in Q2 FY25 amounted to $18.9 million, with no charges reported in Q2 FY24[67] - Legal matters resulted in expenses of $3.4 million, compared to $14.0 million in the previous year[68] Cash Flow and Debt - Free cash flow decreased by $102 million to $539 million compared to the prior year period[25] - The company ended the quarter with net debt of $8.4 billion, representing a 6.5% reduction in net debt year-over-year[26] - Total debt as of FY25 YTD was $8,463.6 million, with net debt at $8,426.2 million[63] - The company reported net cash flows from operating activities of $754.2 million, down from $854.6 million, a decrease of approximately 11.7%[46] - Free cash flow for FY25 YTD decreased by 15.9% to $538.8 million compared to $640.6 million in FY24 YTD[63] Margins and Profitability - Adjusted operating margin was approximately 14.8% for fiscal 2025 guidance, reflecting a decrease from the previous year[27] - Adjusted operating profit for Q2 FY25 was $490.1 million, with a year-over-year decrease of 4.0%[49] - The operating profit margin for Q2 FY25 was 12.6%, down from 14.0% in Q2 FY24[49] - The operating profit margin for Conagra Brands was 13.4% in Q2 FY25, down from 14.8% in the previous year, indicating a decline of 191 basis points[51] - Conagra Brands reported a total adjusted operating profit of $888.0 million for Q2 FY25, reflecting a year-over-year decrease of 10.7%[51] - The company reported an operating profit of $888.0 million for FY25 YTD, which is 13.4% of net sales[61] Tax and Interest - The effective tax rate was 17.8%, reflecting a $14.4 million tax benefit from the release of reserves on unrecognized tax benefits[23] - Net interest expense decreased 4.5% to $108 million due to a reduction in total debt[9] - Interest expense decreased slightly to $214.0 million from $219.3 million[68] - The income tax expense for Q2 FY25 was $61.5 million, down from $102.9 million in Q2 FY24[67] Assets and Equity - Total current assets increased to $3,205.4 million from $3,149.5 million, reflecting a rise of about 1.8%[45] - Current liabilities surged to $4,559.7 million, up from $3,241.8 million, indicating a significant increase of approximately 41%[45] - Cash and cash equivalents decreased to $37.4 million from $77.7 million, a decline of about 52%[46] - Total stockholders' equity rose to $8,800.7 million from $8,511.3 million, an increase of approximately 3.4%[45]