Conagra Brands Inc. missed market estimates for quarterly profit on Thursday, as the Slim Jim jerky maker took a hit from surging prices of raw materials and higher shipping costs.
Margins of packaged food companies have come under pressure in recent months from a spike in prices of commodities such as wheat, sugar and edible oils, while an overburdened supply chain has driven up freight costs.
That has prompted the likes of Conagra -- which owns Birds Eye, Duncan Hines and many other nationally recognizable brands -- to hike prices, which along with sustained at-home cooking trends, helped the company's net sales rise 2.1% in the second quarter.
It also raised its annual core sales forecast to a rise of about 3% from its prior estimate of a 1% growth.
Net income attributable to Conagra declined to $275.5 million, or 57 cents per share, in the quarter ended Nov. 28, from $378.9 million, or 77 cents per share, a year earlier.
Excluding one-time items, Conagra earned 64 cents per share, below estimates of 68 cents per share.
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