ConAgra Brands Misses Q1 Estimates, Affirms Full-Year Outlook by Investing.com

ConAgra Brands ( CAG ) reported its fiscal 2025 first quarter on Wednesday that came in below analysts’ expectations as the food company faced challenges from inflation and temporary production disruptions.

Shares fell 3% after the earnings release.

The Chicago-based company reported adjusted earnings per share of $0.53, missing analysts’ consensus estimates of $0.59. Revenue was $2.79 billion, below estimates of $2.84 billion and down 3.8% from last year. Organic net sales were down 3.5%.

ConAgra cited temporary production disruptions during the key barbecue season, which it estimates impacted quarterly results by about $27 million. The company also faced headwinds from cost inflation and unfavorable operating leverage.

“Our team executed well to meet key business priorities in the first quarter in what continued to be a challenging environment,” said Sean Connolly, President and CEO of ConAgra Brands.

Despite the Q1 rate, ConAgra reaffirmed its guidance for full fiscal 2025. The company expects organic net sales between -1.5% to flat compared to fiscal 2024, adjusted operating margin of 15.6% to 15.8% and adjusted EPS of $2.60 to $2.65.

Gross margin fell 189 basis points to 26.5% in the quarter. The company’s Refrigerated & Frozen segment posted the biggest decline, with operating profit down 11.6% to $176 million.

ConAgra noted that it gained market share in several categories, including microwave popcorn, seeds, pudding and pickles. The company ended the quarter with a net leverage ratio of 3.60x, down from a year earlier.