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ConAgra Foods Inc. (CAG - Analyst Report) reported strong financial results for the fiscal fourth quarter of 2013 with a significant year-over-year growth in both the top- and bottom-line. The company reported earnings per share from continuing operations, adjusted for items impacting comparability, of 60 cents versus 51 cents in the year-ago quarter, representing a healthy year-over-year improvement of 17.6%. Earnings also surpassed the Zacks Consensus Estimate by a penny.

For fiscal 2013, ConAgra reported adjusted earnings per share of $2.16, beating the Zacks Consensus Estimate by a penny and increased 17.4% from the year-ago period.

Revenues: Net sales jumped 33.7% to $4,593.5 million from $3,434.9 million in the year-earlier quarter, driven by increased volumes in the Consumer Foods segment and contribution from the Ralcorp acquisition. Reported revenue, however, missed the Zacks Consensus Estimate of $4,629.0 million.

On a segment basis, revenue from Commercial Foods increased 3.5% year over year to $1,330.2 million, led by the benefit of a favorable price-mix, increased productivity and a solid contribution from the Lamb Weston potato operations and flour milling operations. However, the increase in Lamb Weston business was slightly offset by softness in the Asian markets.

Revenue from the Consumer Foods segment rose 7.0% to $2,301.0 million. The rise reflects contribution from favorable acquisitions and organic volume growth, which was offset by a negative price/mix impact.

The newly established segments to represent the revenues from Ralcorp Holdings acquired in January also helped the top-line to grow. While Ralcorp Frozen Bakery Products generated revenues of $250.6 million, Ralcorp Food Group recorded revenues of $711.7 million in the reported quarter.

For fiscal 2013, total revenues were $15,491.4 billion, missing the Zacks Consensus Estimate of $15,769.0 million while increasing 15.9% compared to fiscal 2012.

Costs/Margins: In the reported quarter, ConAgra’s COGS (cost of goods sold) shot up 32.0% from the year-earlier quarter to $3,641.7 million, resulting in a gross margin of 20.7%. SG&A (selling, general and administrative) expense was $571.0 million, down 26.9% year over year.

Balance Sheet/Cash Flow: Cash and cash equivalents at the end of fiscal 2013 were $183.9 million, compared to $103.0 million at fiscal-end 2012. Senior long-term debt increased to $8,691.0 from $2,662.7 million in fiscal 2012.

For fiscal 2013, ConAgra incurred capital expenditures of $458.4 million, compared with $336.7 million spent in fiscal 2012.

Guidance: For fiscal 2014, ConAgra expects its earnings per share (adjusted for items impacting comparability) to be $2.40, indicating a year-over-year hike of 11.0%. The company expects significant contribution from the Consumer Foods segment as well as Ralcorp. Based on this, ConAgra expects an earnings rise of minimum 10.0% for fiscal 2015-2017. In the long-term, the company expects to see a sales growth of 3.0%-4.0%, with earnings per share growth of 7.0%-9.0%.

ConAgra currently carries a Zacks Rank #3 (Hold). Other stocks worth a look in the food industry include B&G Foods Inc. (BGS - Snapshot Report), Flowers Foods, Inc. (FLO - Snapshot Report) and Omega Protein Corp. , each carrying a Zacks Rank #1 (Strong Buy).

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