Pinnacle Foods Q4 Adj Profit Meets View, But Sales Miss; Guides 2014 EPS In Line

(RTTNews) - Convenience foods company Pinnacle Foods, Inc. (PF) reported Thursday a profit for the fourth quarter that grew 28 percent from last year, reflecting lower interest expense, improved gross margins and sales growth.

Stripping down the charges, adjusted earnings per share matched analysts' expectations, while quarterly net sales missed their estimates. The company also provided earnings guidance for the full-year 2014, in line with Street view.

"Our solid finish to the fourth quarter capped off an outstanding first year as a public company. Our ability to outpace the performance of our composite categories, combined with strong productivity and product mix, enabled us to deliver financial results that exceeded our long-term growth targets," CEO Bob Gamgort said in a statement.

The maker of Birds Eye frozen foods, Duncan Hines baking mixes and frostings, and Vlasic shelf-stable pickles reported net earnings of $55.71 million or $0.48 per share for the fourth quarter, compared to $43.66 million or $0.51 per share in the prior-year quarter.

Excluding items, proforma net earnings for the quarter was $67.6 million or $0.58 per share, compared to $60.8 million or $0.52 per share in the year-ago quarter.

On average, 11 analysts polled by Thomson Reuters expected the company to report earnings of $0.58 per share for the quarter. Analysts' estimates typically exclude one-time items.

Net sales for the quarter edged up 0.6 percent to $709.32 million from $705.06 million in the same quarter last year, but missed six Wall Street analysts' consensus estimate of $718.39 million.

Excluding the 53rd week last year that produced $28 million in sales, net sales advanced 4.8 percent.

North America retail net sales increased 1.7 percent to $617 million from last year, as Duncan Hines Grocery net sales improved 8.0 percent to $315 million, partially offset by a 4.1 percent decline in Birds Eye Frozen net sales to $302 million from a year ago. Net sales for the specialty foods declined 6.1 percent to $92 million from last year.

Interest expense also nearly halved to $24.48 million from $43.88 million in the year-ago quarter.

Looking ahead to fiscal 2014, Pinnacle Foods expects adjusted earnings in a range of $1.75 to $1.80 per share. Street is currently looking for full-year 2014 earnings of $1.78 per share.

"In addition, our acquisition of the Wish-Bone business in the fourth quarter provides us with an important catalyst for growth in 2014 and beyond," Gamgort added.

PF closed Wednesday's regular trading session at $28.50, up $0.06 on a volume of 0.38 million shares.