For the fiscal year, diluted earnings per share (EPS) from continuing operations grew from $0.29 to $1.25, with the fourth quarter improving from $0.27 to $0.36. Adjusted diluted EPS from continuing operations grew 33.8 percent from $1.30 to $1.74 in fiscal 2017, with strong growth in the fourth quarter of 15.6 percent to $0.37, according to a release from the company.
"Fiscal 2017 marked our second year of tremendous progress in reshaping our company for success,” Sean Connolly, president and CEO said in a statement. “The aggressive actions we have taken to upgrade the quality of our revenue base, while focusing and modernizing our portfolio, have enabled us to improve our margins and jump-start innovation. Guided by our portfolio management principles outlined at our investor day, we are producing solid results. We are confident in our ability to continue to build on this momentum and drive long-term shareholder value."
For the fiscal year ended May 28, 2017, diluted earnings per share from continuing operations grew to $1.25 from $0.29, with the fourth quarter growing to $0.36 from $0.27. Conagra attributed the result to lower selling, general, and administrative (SG&A) expenses as a result of debt reduction. Results partially were offset by planned volume declines and the impact of the divestitures of the Spicetec Flavors and Seasonings and JM Swank businesses.
Net income attributable to Conagra Brands declined 12.2 percent to $179.7 million, or $0.41 per diluted share, compared with $204.6 million, or $0.46 per diluted share reported in the year-ago quarter.
Net sales for the quarter were $1,861.7 million, down 9 percent from $2,053.0 million reported in the fourth quarter of 2016. Net sales for the fiscal year were $7,826.9 million down 9 percent from $8,664.1 million for the fiscal year 2016.
On a segment basis, net sales in Grocery & Snack declined 3 percent to $749 million on a 2 percent decline in volumes due to “…a reduction in promotional intensity and the planned discontinuation of certain lower-performing products,” the company said. Operating profit for the segment decreased 52 percent, while adjusted operating profit decreased 5 percent driven primarily by increased advertising and promotion (A&P) investments. “Favorable SG&A and net pricing offset the negative impact of volume declines and unfavorable brand margin mix. The unfavorable brand margin mix was primarily driven by recent growth-oriented acquisitions, where margins are expected to rise over time,” the company said.
In the Refrigerated & Frozen business, net sales decreased 5 percent to $640 million. Volume also declined 5 percent. Operating profit for the segment increased 8 percent in the fourth quarter, and adjusted operating profit increased 2 percent.
Net sales in the company’s International segment decreased 1 percent to $205 million. A 3 percent increase in foreign exchange and a 1 percent decrease in volume more than offset a 3 percent increase in price/mix, the company said. The segment reported an operating loss of $11 million from an operating profit of $14 million in the year-ago period, reflecting pre-tax goodwill and intangible impairment charges of $28 million related to the Canadian and Mexican businesses, the company reported. Adjusted operating profit increased 33 percent behind higher price/mix and lower SG&A expenses.
The Foodservice segment reported net sales of $267 million, a 5 percent decline compared to a year-ago, the company said. Volume decreased 17 percent while price/mix increased 12 percent, driven by the impact of exiting a non-core business in the prior-year period.
Operating profit for the segment increased 2 percent compared to the year-ago quarter, reflecting general stability in the business, the company said.