Lamb Weston Holdings, Inc. announced its fiscal third quarter 2022 results and updated its fiscal 2022 outlook in early April.
Tom Werner, President and CEO said in a press release: “We continued to make financial and operating progress in the quarter through strong execution of pricing actions to manage significant input, manufacturing and supply chain cost inflation.”
“Our pricing actions, along with manufacturing productivity and cost mitigation efforts, drove sequential and year-over-year improvement in our gross margin despite the Omicron variant affecting demand across our restaurant and foodservice channels, and disrupting production and distribution operations more than we anticipated. In addition, constraints in global logistics networks continued to significantly limit our international sales volumes.”
Mr Werner said Lamb Weston is managing through a challenging macro environment well and remain on track to deliver its financial targets for fiscal 2022.
“The increase in our potato costs resulting from the exceptionally poor crop harvested in fall 2021 in the Pacific Northwest is in line with expectations, and we have secured enough raw potatoes to meet our near-term production forecast.
“We plan to continue to execute on our pricing, productivity and cost management actions to mitigate the effect of inflation, and drive run-rate and throughput improvements in our factories. Our capacity expansions in Idaho and China are on schedule, and we remain confident that continuing to invest in our business and executing on our strategies will have us well positioned to support the needs of customers and drive long-term growth.”
Net sales of the company increased $59.2 million to $955.0 million, up 7 percent versus the prior year quarter. Income from operations increased $33.2 million to $133.8 million, up 33 percent versus the prior year quarter, reflecting higher gross profit and lower selling, general and administrative expenses (“SG&A”).
Gross profit increased $24.3 million, as the benefits from higher price/mix more than offset the impact of higher manufacturing and distribution costs on a per pound basis, as well as lower sales volumes.
Net income was $106.6 million, up $40.5 million versus the prior year quarter.
Net sales for the Global segment, which is generally comprised of the top 100 North American based quick service (“QSR”) and full-service restaurant chain customers as well as all of Lamb Weston’s international sales, increased $9.4 million to $487.9 million, up 2 percent versus the prior year quarter.
Source: Lamb Weston Holdings Inc. Read the full press release here
Image: Courtesy Lamb Weston