Conagra Brands, Inc. (NYSE: CAG) gained ground Thursday on quarterly earnings.
The Chicago-based company reported net sales grew 0.7% and organic net sales declined 2.2% in the quarter. Consumption trends continued to improve but exceeded shipments to customers in the third quarter. This follows shipments in excess of consumption in the second quarter.
A news release out Thursday also reported that, aided by a lower effective tax rate, diluted earnings per share (EPS) from continuing operations grew 112.2% from $0.41 to $0.87 in the quarter, and adjusted diluted EPS from continuing operations grew 27.1% from $0.48 to $0.61.
For fiscal 2018, the Company now expects adjusted EPS to be in the range of $2.03 to $2.05, above the previously estimated range of $1.95 to $2.02.
Conagra CEO Sean Connolly commented, "I continue to be pleased with the progress we are making on improving our fundamentals, particularly on the top line. Our efforts are paying off, and our businesses are gaining momentum.
“Our frozen portfolio, where we put most of our innovation focus this year, continues to show strong growth and share gains. Consumption in our Grocery & Snacks segment also continues to strengthen, and non-promoted consumption exceeded expectations in the quarter."
Gross profit decreased 3.6% to $599 million in the quarter. The decline was primarily driven by increased input costs and transportation expenses, as well as investments to drive brand saliency, enhanced distribution, and consumer trial, partially offset by realized productivity savings, and increased net sales.
Shares in CAG climbed 64 cents, or 1.8%, toward noon ET on Thursday to $35.98
