News January 2024, North America, Processing, fries, chips

Lamb Weston reports strong fiscal Second Quarter 2024 results, raises full-year targets

Lamb Weston Holdings, Inc., a leading supplier of frozen potato products, announced its fiscal second quarter 2024 results, showcasing significant growth and updating its outlook for the fiscal year 2024.

Key Financial Highlights:

  • Net Sales Surge: Net sales saw a remarkable 36% increase to $1,732 million, boosted by $376 million from the LW EMEA Acquisition.
  • Profit Growth: Income from operations rose by 12% to $306 million, while net income skyrocketed by 109% to $215 million.
  • Earnings Per Share: Diluted EPS jumped by 108% to $1.48.
  • Adjusted Financial Metrics: Adjusted Income from Operations increased by 22% to $301 million, Adjusted Net Income by 17% to $212 million, and Adjusted Diluted EPS by 15% to $1.45. Adjusted EBITDA also grew by 15% to $377 million.
  • Shareholder Returns: Lamb Weston repurchased $50 million of common stock and paid $41 million in dividends. The company announced a 29% increase in its quarterly dividend to $0.36 per share.

Fiscal 2024 Outlook:

  • Sales Target: The company reaffirms its net sales target of $6.8 billion to $7.0 billion.
  • Increased Net Income and EPS Targets: GAAP net income target is raised to $830 million to $900 million, with a Diluted EPS target of $5.70 to $6.15.
  • Adjusted EBITDA: The target range remains at $1,540 million to $1,620 million, inclusive of a $71 million charge for excess raw potato write-offs.
  • Adjusted Net Income and EPS: Targets are raised to $830 million to $900 million and $5.70 to $6.15, respectively.

CEO’s Remarks:

Tom Werner, President and CEO, expressed satisfaction with the quarter’s results, attributing the success to effective execution across customer channels in North America and key international markets. He noted the benefits from inflation-driven pricing actions, improvements in customer and product mix, and supply chain productivity cost savings. Werner anticipates a stable consumer and operating environment for the remainder of fiscal 2024.

Operational Highlights:

  • Sales Growth: Net sales increased by $455.6 million to $1,732.1 million, a 36% rise from the previous year, including significant contributions from the LW EMEA Acquisition.
  • Gross Profit Increase: Gross profit rose by $94.0 million, despite a $64.6 million charge for excess raw potato write-offs.
  • International Segment: The International segment saw a 164% increase in net sales to $565.0 million, driven by the LW EMEA Acquisition.

Outlook and Strategy:

Lamb Weston remains committed to delivering strong sales and earnings growth for fiscal 2024. The company is well-positioned for sustainable, profitable growth over the long term, despite challenges such as excess raw potato write-offs.

For more information, visit Lamb Weston’s Investor Relations.

Source: Lamb Weston Holdings, Inc.

Editor & Publisher: Lukie Pieterse


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