Research Desk Line-up: Pinnacle Foods Post Earnings Coverage

LONDON, UK / ACCESSWIRE / August 4, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on Lamb Weston Holdings, Inc. (NYSE: LW) (“Lamb Weston”), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=LW, following the Company’s disclosure of its fourth quarter and full year 2017 results, on July 25, 2017. The frozen foods supplier beat revenue and earnings expectations. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member’s account at:

http://protraderdaily.com/register/

Get more of our free earnings reports coverage from other constituents of the Food – Major Diversified industry. Pro-TD has currently selected Pinnacle Foods Inc. (NYSE: PF) for due-diligence and potential coverage as the Company reported on July 27, 2017, its financial results for Q2 FY17 which ended on June 25, 2017 and also reaffirmed its full-year guidance at the low end of its range. Register for a free membership today, and be among the early birds that get access to our report on Pinnacle Foods when we publish it.

At Pro-TD, we make it our mission to bring you news that matter about the stock you follow. Today, our research desk covers a blog story on LW; also brushing on PF. With the links below you can directly download the report of your stock of interest free of charge at:

http://protraderdaily.com/optin/?symbol=LW

http://protraderdaily.com/optin/?symbol=PF

Earnings Reviewed

For the thirteen weeks ended May 28, 2017, Lamb Weston’s net sales were $832.5 million, up 7% compared to sales of $777.0 million in Q4 FY16. The Company’s sales numbers outperformed analysts’ estimates of $810.85 million.

For Q4 FY17, the Company’s volume increased 4% on a y-o-y basis, with growth across all business segments. Lamb Weston’s price/mix grew 3% compared to the year ago same period due to pricing actions and favorable product and customer mix.

During Q4 FY17, Lamb Weston’s income from operations rose 136% on a y-o-y basis to $122.5 million from $51.9 million in Q4 FY16 and included $2.8 million of costs related to the spinoff from Conagra Brands, Inc. (formerly ConAgra Foods, Inc.) and a $3.1 million non-cash gain on assets. The Company’s adjusted EBITDA, including unconsolidated joint ventures, was $176.4 million, up 12% on a y-o-y basis, mainly reflecting higher equity method investment earnings as well as growth in income from operations.

For Q4 FY17, net income attributable to Lamb Weston totaled $75.9 million, or $0.51 per diluted share, compared to net income of $42.6 million, or $0.29 per diluted share, in Q4 FY16 largely due to pension charges for actuarial losses and costs related to the spinoff from Conagra in the prior year’s comparable period, higher equity method investment earnings and growth in income from operations.

The Company’s adjusted diluted EPS totaled $0.51 for the reported quarter, down 11% compared to $0.57 in the prior year’s corresponding period, primarily due to higher interest costs, partially offset by higher equity method investment earnings and growth in income from operations. Lamb Weston’s earnings numbers exceeded Wall Street’s expectations of $0.48 per share.

Segment Highlights

During Q4 FY17, Lamb Weston’s net sales for the Global segment, which is comprised of the top 100 North American based restaurant chain customers as well as its international business, grew 6% to $421.4 million. The segment’s volume rose 4%, driven by growth in both domestic and international markets, while price/mix increased 2%. Global segment product contribution margin rose 10% to $83.9 million in the reported quarter, primarily driven by favorable volume and price/mix.

Lamb Weston’s net sales from Foodservice segment, which services North American foodservice distributors and restaurant chains outside the top 100 North American based restaurant chain customers, increased 9% to $277.0 million. The segment’s price/mix increased 8%, reflecting pricing actions and improvement in customer and product mix. On the other hand, volume increased 1%, largely driven by demand from independent restaurant operators, as well as small and mid-sized restaurant chains. During the reported quarter, Foodservice segment product contribution margin surged 24% to $89.3 million, primarily driven by favorable price/mix.

Lamb Weston’s net sales from the Retail segment, which comprises sales of Alexia branded, licensed branded, and private label products to grocery, mass merchant, and club customers in North America, was up 5% to $99.0 million. The segment’s volume increased 7%, primarily driven by the growth of private label products and price/mix decreased 2%, largely due to higher trade spending in support of the introduction of Grown in Idaho branded products as well as unfavorable mix. Retail segment product contribution margin dropped 17% to $14.7 million, mainly due to lower price/mix.

Cash Matters

During FY17, Lamb Weston generated nearly $450 million cash from operations, up from about $380 million in 2016. The Company reinvested nearly $290 million of that cash flow into capital expenditures to support future growth. Lamb Weston reduced its leverage to about 3.7x adjusted EBITDA, well within the Company’s target range of 3.5x to 4x. In the 8 months since the spinoff in November 2016, the Company has returned approximately $54 million to its shareholders.

Stock Performance

On Thursday, August 03, 2017, the stock closed the trading session at $43.22, falling 1.23% from its previous closing price of $43.76. A total volume of 461.90 thousand shares have exchanged hands. Lamb Weston’s stock price surged 4.75% in the last three months and 12.49% in the past six months. Furthermore, since the start of the year, shares of the Company have rallied 14.19%. The stock is trading at a PE ratio of 19.49 and has a dividend yield of 1.74%. At Thursday’s closing price, the stock’s net capitalization stands at $6.32 billion.

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