Conagra Brands Reports Q2 Fiscal 2025 Results with $3.195 Billion in Net Sales

Conagra Brands, Inc. reported its financial results for the second quarter of fiscal 2025, revealing net sales of $3.195 billion, a slight decrease of 0.4% compared to $3.208 billion in the same period last year. For the first half of the fiscal year, net sales totaled $5.990 billion, down 2.0% from $6.112 billion in the prior year. The company's net income for the quarter was $284.5 million, or $0.59 per diluted share, compared to $286.2 million, or $0.60 per diluted share, in the second quarter of fiscal 2024. Year-to-date net income reached $751.4 million, up from $606.1 million in the first half of the previous fiscal year, resulting in earnings per share of $1.57, compared to $1.26.

The company experienced mixed performance across its segments. The Grocery & Snacks segment saw a 2.0% increase in net sales, driven by a favorable brand mix and inflation-driven pricing, while the Refrigerated & Frozen segment remained flat. However, the International and Foodservice segments reported declines of 12.9% and 0.9%, respectively, primarily due to unfavorable foreign exchange rates and decreased volumes. Notably, the company completed the sale of its 51.8% stake in Agro Tech Foods Limited, which contributed to a loss of $2.3 million in the first quarter.

Strategically, Conagra made significant acquisitions, including the purchase of Sweetwood Smoke & Co. for $179.4 million and a co-manufacturer for $51.2 million, which are expected to enhance its product offerings in the Grocery & Snacks segment. The company also recognized restructuring charges of $79.5 million in the second quarter, aimed at improving operational efficiencies. Additionally, Conagra reported an impairment charge of $18.9 million related to certain brand intangible assets.

Operationally, the company reported a decrease in selling, general, and administrative expenses to $444.1 million for the quarter, up from $398.1 million a year earlier, largely due to restructuring costs. The company’s total debt as of November 24, 2024, was approximately $7.27 billion, with a revolving credit facility of $2.0 billion available. Looking ahead, Conagra anticipates continued challenges from inflation and shifting consumer preferences but expects to leverage its strategic initiatives to improve performance in the coming quarters.