(Reuters) – Conagra Brands Inc missed Wall Street estimates for quarterly sales on Thursday, with demand for its frozen foods and ready-to-eat meals slowing as it raised product prices.
As decades-high inflation pinches spending at American households, top retailers have warned that more consumers are turning to cheaper private-label products, hurting demand at Conagra.
The company said its volumes fell 6.4% in the fourth quarter, as consumers showed signs of pushing back against price increases.
Lingering supply chain issues and soaring freight and ingredient costs have also eaten into Conagra’s profit margins, which have shrunk despite multiple rounds of price hikes over the past year.
Net sales rose 6.2% to $2.91 billion in the fourth quarter ended May 29, from $2.74 billion a year earlier. Analysts on average expected sales of $2.93 billion, according to Refinitiv IBES data.
Net income attributable to Conagra declined to $158.9 million, or 33 cents per share, from $309.5 million, or 64 cents per share, a year earlier.
(Reporting by Mehr Bedi and Deborah Sophia in Bengaluru; Editing by Vinay Dwivedi)
