Sara Lee reports Q1 earnings, gives coffee-and-tea spinoff update
The Downers Grove, Ill. company, which is planning to split into two publicly traded companies, also cut its fiscal 2012 revenue guidance due to unfavorable foreign currency exchange rates.
Sara Lee lost $215 million, or 37 cents per share, for the period ended Oct. 1. That compares with net income of $194 million, or 29 cents per share, a year earlier.
Excluding an impairment charge and other items, earnings from continuing operations were 18 cents per share.
This beat the 17 cents per share that analysts surveyed by FactSet expected, on average.
Revenue climbed 13 percent to $1.94 billion from $1.73 billion, but missed Wall Street's forecast of $1.96 billion.
North American retail revenue slipped 2 percent as higher prices were not able to offset volume declines. The segment was also hindered a bit by startup and marketing expenses for new products under its Hillshire Farm brand, such as Grilled Essentials, Gourmet Creations and Deli Carvers.
In the North American foodservice and specialty meats unit, revenue rose on increased prices and volume gains.
Coffee and tea revenue climbed on higher prices as well as the success of its L'OR EspressO capsules, the strong performance of Senseo in Spain and France and the end of private label production in France.
Sara Lee said it now foresees fiscal 2012 revenue of $7.9 billion to $8.15 billion, down from a previous forecast for revenue between $8.5 billion and $8.75 billion. The company maintained its guidance for adjusted earnings in a range of 89 cents to 95 cents per share.
Analysts predict earnings of 91 cents per share on revenue of $8.47 billion for the year.
The company said it anticipates declaring and paying a special dividend of $3 per share in the first half of 2012, prior to the completion of its split into two publicly traded companies.
Sources: The Associated Press, Sara Lee Corp.,