In first earnings, Conagra spinoff Lamb Weston shows profits and promise
- In its first earnings report as an independent company, Lamb Weston — which was recently spun off from Conagra Brands — saw better-than-expected growth, according to a company statement. Net sales were up 7% to $790.7 million year-over-year while net income attributable to the company was up 19% to $87.2 million.
- Gains were driven by increases in both domestic and global sales — which were up 6% over the same period last year, the report states.
- The frozen potato company also saw jumps in both its foodservice and retail segments. Foodservice posted an 11% increase in net sales to $250.6 million, while retail saw a 5% increase in net sales to $96.5 million.
Lamb Weston is off to a profitable and productive start as an independent company. Conagra, hoping to focus more on its consumer brands, completed the spinoff of the frozen potato supplier in November. While the larger company was working to finalize the break, some experts said that this could be one of the most lucrative spinoffs of 2016.
There is ample reason for Lamb Weston's success over the last quarter. Not only is demand increasing worldwide for frozen potatoes, but Conagra invested $230 million on plant expansions in Richland, WA and Boardman, OR.
Moving forward, Lamb Weston is primed to continue its gains. The company supplies McDonald's and Yum Brands, and analysts are already boosting their projections.
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