Friday, snack foods maker Lance, Inc. (LNCE) reported a rise in profit for the second quarter, reflecting an 11% increase in revenues due to increased volumes and higher selling prices stating that there was continued growth in both branded and non-branded portfolios. However, the company's per share earnings missed analysts' estimate by a penny. Lance also raised its earnings outlook for the fiscal year 2009.
Net income for the second quarter increased to $9.53 million or $0.30 per share from $2.71 million or $0.09 per share in the previous year.
On average, five analysts polled by Thomson Reuters expected the company to report earnings of $0.31 per share for the second quarter. Analysts' estimates typically exclude special items.
Net revenue for the quarter increased 11% to $236.35 million from $213.61 million last year. Of the 11% growth, about 4% was driven by higher selling prices and about 7% was due to increased volume, including the impact of the Archway acquisition. Analysts were expecting the company to report revenues of $233.08 million for the second quarter.
Branded product sales, which represented about 59% of total sales in the 2009 second quarter, increased about 5% from the second quarter of 2008, benefited from from higher selling prices, volume growth in Lance sandwich crackers and incremental revenue associated with the Archway acquisition.
Non-branded product sales in the 2009 second quarter increased about 20% from the prior-year comparable period, including a 16% growth in the company's private brands business driven by higher selling prices and volume growth from new product introductions.
Revenues from the company's contract manufacturing business increased $6.6 million or 32% in the quarter, reflecting higher volume and selling prices.
During the quarter advertising spending increased about $4.0 million, as compared to the same quarter in 2008. In addition, costs of about $0.01 per share were incurred in the second quarter of 2009 associated with the closure and relocation of the Little Rock, Arkansas facility.
For the six-month period, net income increased to $15.98 million or $0.50 per share from $3.35 million or $0.11 per share in the same period of the previous year. Net revenue for the period increased to $452.16 million from $411.58 million a year ago.
Looking forward, the company now sees fiscal 2009 earnings per share in a range of $1.15 to $1.25, up from the previous estimate range of $1.10 to $1.20. The company also reaffirmed both sales estimate that ranges between $910 million and $930 million as well as capital expenditure estimate that ranges between $41 million and $46 million for the full year.
Analysts expect the company to report earnings of $1.20 per share on revenues of $920.10 million for fiscal 2009.
The company also declared a dividend of $0.16 per share payable on August 20 to stockholders of record at the close of business on August 10, 2009.
LNCE is currently trading at $23.96, 3.74 on the Nasdaq.
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