Lamb Weston Holdings posted robust fourth-quarter fiscal 2021 results, as both top and bottom lines increased year over year, according to a report by Zacks Equity Research, published on Nadaq.com. Results were largely aided by demand recovery for frozen potato products, with curbs being lifted and restaurant traffic improving.
According to the Zachs report, management remains encouraged about the recovering restaurant traffic in the United States, particularly at full-service restaurants. It further expects overall U.S. demand for french fries to return to pre-pandemic levels around the end of calendar year 2021.
Demand in Europe and key export markets is likely to improve with the increased availability of vaccines in the regions. That said, lingering pandemic impacts and the sudden recovery of the broader U.S. economy have hurt the overall supply chain of the industry.
Zacks reports that supply-chain disruptions, significant input and transportation cost inflation, and a tough labor market are likely to put pressure on the company’s earnings in the near term. Nonetheless, these pressures are likely to ease with gradual enhancements in supply-chain operations and when the company is able to combat escalated costs.
Net sales came in at $1,007.5 million, which advanced 19% year on year and beat the consensus mark of $940 million. Volumes rose 13% year over year and price/mix went up 6%. On excluding the impact of an additional week in the year-ago period, net sales and volumes jumped 28% and 21%, respectively.
Source: Zacks via Nadaq.com. Read the full report here