- Bob Evans Farms posted sales of $313.4 million in its fourth quarter, a decline of 9.3% from $345.6 million in the same period a year earlier, the food company said in a statement. Earnings per share in the period were 61 cents, topping a 48-cent forecast.
- Excluding its restaurant operations, which were sold to Golden Gate Capital on April 28, the company's food products division had revenue of $99.9 million during a 13-week period — trailing the $105 million consensus from FactSet, according to MarketWatch — compared to $102.4 million in 14 weeks last year. Excluding the 14th week in the prior year period, net sales from continuing operations increased 4.9%.
- The producer and distributor of refrigerated potato, pasta and vegetable-based side dishes, pork sausage, and other food products said its revenue was affected by an increase in sales of lower-priced, higher-margin side-dish products as well as reduced sausage pricing.
The end of Bob Evans' fourth quarter on April 28 saw the company sell off its troubled restaurant division in favor of focusing on side dishes and sausages — a decision that was widely praised by shareholders and an activist investor. In May, the company closed its $115 million acquisition of Pineland Farms Potato, which the company said will help boost profits and growth.
"We closed the fiscal year with strong fourth quarter earnings, exceeding our full year guidance, and completed the strategic transactions that have reshaped Bob Evans into a higher growth and higher margin, pure-play packaged foods company," Mike Townsley, Bob Evans' president and chief executive officer, said in a statement. "We are now focusing our attention on capitalizing on the growth opportunities in our refrigerated side-dish business while completing the integration of Pineland Farms Potato Company."
The latest quarter showed the company's revenue was impacted by an increase in sales of lower-priced, higher-margin side-dish products along with reduced sausage pricing. From a net sales perspective, Bob Evans posted an 11.5% increase in side-dish pounds sold, a 9.2% jump in sausage pounds sold and a 11.5% rise in food service pounds sold. This was partially offset by a 17% percent decline in frozen product pounds.
With the food products division becoming a stand-alone company, some believe the maker of sausages, potatoes and other items could be a takeover target for a large food manufacturer looking for growth. Executives at Bob Evans will likely be under pressure to grow the company and show it can thrive as a standalone operation.
Bob Evans reiterated its fiscal year 2018 guidance with sales of $470 million. It also initiated an earnings per share forecast between $2.06 to $2.24.
Valued at $1.4 billion, Bob Evans would be a small bite for some of the bigger players in the prepared food space.