Sara Lee income dips in second quarter

by Meat&Poultry Staff
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DOWNERS GROVE, Ill. — Net income at Sara Lee Corp. was $468 million in the second quarter ended Dec. 31, equal to 79 cents per share on the common stock, down 44 percent from income of $831 million, or $1.30 per share, during the same quarter of the previous year. Adjusted net income, meanwhile, fell 11 percent to $177 million from $198 million.

Sales for the quarter were $2,081 million, up 6 percent from $1,958 million during the same quarter of the previous year.

“The meat business showed a marked improvement in volume and mix trends in the quarter in response to course corrections,” said Marcel Smits, chief executive officer. “We made brisk improvement on the meat categories in the retail and food service businesses, while the bakery categories lagged. Coffee and Tea continued its upward trend and, importantly, operations in the key Western European countries continue to perform well. We are confident that we now have the market fundamentals in line to deliver on our guidance for the full year.”

North American Retail operating income totaled $81 million in the second quarter, down 4 percent from $84 million a year ago. Sales eased 0.1 percent to $741 million. Adjusted operating income for the segment was $88 million, up 5 percent from $84 million, while sales were down 0.1 percent at $741 million.

Operating income in the North American Foodservice and Specialty Meats segment totaled $33 million, down 14 percent from $38 million, while sales rose 8 percent to $314 million from $290 million. Adjusted operating income in the North American Foodservice and Specialty Meats segment was $30 million, down 19 percent from $37 million a year ago, while sales rose 4 percent to $287 million.

For the six months ended Dec. 31, the company had income of $251 million, equal to 42 cents per share, down 75 percent from $1,023 million, or $1.58 per share, during the same period of the previous year. Sales for the period were $4,024 million, up 9 percent from $3,685 million during the same period of the previous year.

“We continue to see solid progress in our businesses as we head into the second half of our fiscal year,” said Jan Bennink, executive chairman. “We remain on track to complete the spin-off during the fourth quarter of the fiscal year. We have closed all announced business divestitures and have supplemented our core businesses with acquisitions that will strengthen our long-term growth profile. Each business now has the chief executive officer and chief financial officer in place, and they are assessing further changes to strengthen the organization.”

For fiscal 2012, the company anticipates adjusted earnings per share to be between 89 cents and 95 cents with overall sales of $7.9 billion to $8.15 billion.

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