ConAgra Foods (NYSE:CAG) bumped up its fiscal 2013 outlook to take into account last month’s $4.95 billion deal to acquire private-label food maker Ralcorp Holdings.
Continue Reading Below
The Omaha, Neb.-based packaged-food maker raised its estimate for full-year adjusted earnings to $2.15 a share, an increase of nine cents. ConAgra said a larger contribution from its consumer foods and commercial foods segments is also reflected in the higher estimate.
According to the company, Ralcorp will account for an additional 25 cents a share to fiscal 2014 adjusted earnings.
“The transaction is financially and strategically compelling and creates a company with $18 billion in net sales and the leading position in North America in private brands,” Gary Rodkin, CEO of ConAgra Foods, said in a statement. “We have already begun the integration process, and look forward to reporting on our progress over the next few months.”
ConAgra also said it will focus on debt reduction through the end of fiscal 2015 to help offset the debt used to purchase Ralcorp. The company also plans to keep its annual $1 dividend through that period and will consider an increase once it meets its debt reduction goals.
ConAgra last raised its 2013 outlook in December on a 17% jump in second-quarter earnings.
Continue Reading BelowAdvertisement
Shares of ConAgra were up 16 cents to $33.89 early Tuesday.