Conagra Brands Inc. has revised its financial outlook for fiscal 2025 following supply chain disruptions and operational challenges early in the year.
The Chicago-based company cited interruptions in its supply of chicken for frozen meals, as well as issues with frozen vegetable availability. A key factor was “product quality inconsistencies” at a poultry facility responsible for preparing and cooking chicken for Conagra’s frozen meal brands. In response, the company temporarily halted production and resumed operations at a slower pace to ensure product consistency—an approach that remains in effect.
“These disruptions have resulted in lower volume, net sales, and profit for the second half of the fiscal year,” the company stated in a recent press release.
Key Changes to Conagra’s 2025 Outlook:
- Organic Net Sales: Now expected to decline by approximately 2%, compared to the previous forecast of a decline between 0% and 1.5%. The company’s long-term goal remains low single-digit growth.
- Adjusted Operating Margin: Reduced to 14.4%, down from an earlier expectation of 14.8%. Conagra’s long-term target remains in the mid- to high-teens.
- Earnings Per Share (EPS): Now projected at approximately $2.35 per share, down from a prior estimate of $2.45–$2.50 per share in December.
- Net Leverage Ratio: Increased to 3.55x EBITDA from 3.4x, with a long-term target of 3x.
Conagra’s protein-based brands include Slim Jim, Healthy Choice, Marie Callender’s, Duke’s, Banquet, and Frontera, alongside its plant-based brand, Gardein.
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