- Snyder’s-Lance reported a 41.3% net revenue increase to $588.8 million, including the contribution of Diamond Foods, per its third quarter earnings report Monday. Branded net revenue, excluding Diamond Foods, hit $306.3 million.
- The company’s quarterly adjusted EBITDA soared 73.2% to $81.8 million, with its quarterly operating margin increasing from 5.9% to 8.1% year over year.
- Snyder’s-Lance raised its fiscal 2016 earnings outlook to the range of $1.24 to $1.30 per share, up from previous estimates of $1.22 to $1.30 per share.
Excluding Diamond Foods, Snyder’s-Lance reported a 2.6% uptick in branded category growth, driven by a 6% volume boost. This is a promising development for the company, which had been struggling with its non-Diamond Foods brands in recent quarters. The addition of Diamond Foods has boosted quarterly results significantly since Snyder’s-Lance completed the acquisition in February, which somewhat masked the challenges that the company’s own brands faced.
Better-for-you brands now account for more than one-third of Snyder’s-Lance’s sales, including products aligned with consumer demand for organic, gluten-free, non-GMO certified and reduced-fat products. The company will continue to focus on improving the ingredients and taste of this section of its portfolio, in addition to driving growth for core brands, president and CEO Carl E. Lee, Jr. said in a statement.
Healthy snacks are a rapidly growing segment and a key source of top-line growth for Snyder’s-Lance, but the company doesn’t necessarily have to abandon its "less healthy" snack foods to stay on trend. The company can instead support its other brands by improving convenience in packaging and product formulation for on-the-go snacking.
The company can also embrace the indulgence factor of its brands, particularly with its salty snacks, while focusing on quality ingredients to appeal to a wider audience. Other major manufacturers, such as Kraft Heinz and Hostess, have succeeded with this approach.