Del Monte Foods Q1 net sales marginally decline to $804.6m
Del Monte Foods, a producer, distributor and marketer of food products in the US, has reported net sales of $804.6m for the first quarter of fiscal 2011, a decrease of 1.1% compared to $813.7m in the same quarter last year.
The company has posted an operating income of $119.4m, compared to $120.9m last year, a decrease of 1.2%. The company said that the $1.5m decline in operating income reflects the negative impact of the topline, partially offset by lower costs (primarily due to productivity savings) as well as favorable mix.
Del Monte Foods chairman and CEO Richard Wolford said that 1.1% topline decline reflects lower revenue from the company's Consumer business with continued healthy topline performance in the Pet business.
“We are not satisfied with our first quarter Consumer sales, but expect performance will strengthen in the second half as competitive and category performance return to historical levels and as we deliver growth through the key holiday seasons,” Wolford said.
For fiscal 2011, the company now expects net sales growth of 1% to 3% over fiscal 2010 net sales of $3.73bn compared to previous expectations of 2% to 4%.
The company continues to expect fiscal 2011 diluted EPS from continuing operations target of $1.38 to $1.42 consistent with the company’s long-term EPS annual growth target of 7% to 9%. Reduced cost inflation expectations net of productivity savings are anticipated to offset the reduction in net sales growth expectations.
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