Snack products and nuts company Diamond Foods Inc (DMND), Monday reported a swing to profit in the first quarter, led by a 5 percent increase in sales and the absence of one-time charges recorded last year, partly offset by lower gross margins. Quarterly sales, however, fell short of Wall Street estimates.
The company reaffirmed its earnings guidance for 2014.
Diamond shares gained about 3 percent in after-hours trade on the Nasdaq.
Diamond, based in San Francisco, California, posted first-quarter net earnings of $7.7 million or $0.24 per share, compared with a loss of $42 million or $1.92 per share last year.
Excluding items, adjusted earnings for the quarter were $0.28 per share, compared with $0.21 per share a year ago.
On average, seven analysts polled by Thomson Reuters estimated earnings of $0.25 per share for the quarter. Analysts' estimates typically exclude special items.
The company's revenues for the quarter rose to $246.6 million from $234.7 million in the prior year. Analysts estimated revenues of $253.5 million for the quarter.
Among segments, snacks sales rose 3.6 percent from last year and nut sales climbed 6.5 percent.
Growth was mainly as a result of higher Kettle US, Diamond of California and Emerald 100 calorie pack sales, partly offset by lower sales in the UK, which was hurt by the loss of a private label contract, the company said.
Gross margin for the quarter slid 60 basis points from a year ago to 24.1 percent.
For fiscal year 2014, the company continues to expect adjusted earnings of $0.90 to $1.10 per share, while analysts currently expect $1.03 per share.
DMND closed Monday at $29.01, down $0.22 or 0.75%, on a volume of 508k shares on the Nasdaq. In after hours, the stock gained $0.78 or 2.69%.
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