ConAgra Foods Inc. on Thursday reported revenue declines across its units as it works to spin off its frozen potato business and focus on higher-quality, higher-priced products.

The Omaha-based food maker, known for brands including Slim Jim snacks, Banquet frozen meals and Peter Pan peanut butter, has been reshaping its business to focus more on foods seen as more natural and healthy.

"While we are taking broad-based actions to build a higher quality revenue base, the related volume declines are concentrated in brands where we have historically underpriced and over-promoted," Chief Executive Sean Connolly said.

ConAgra said that the spinoff of the Lamb Weston frozen-potato line remains on track and that the two companies will host separate investor days in October. The food maker said that Chief Financial Officer John Gehring, who the company said was retiring, will be interim CFO for Lamb Weston.

In February, ConAgra completed the $2.7 billion sale of its private label business to TreeHouse Foods. ConAgra bought the business--which makes cereal, pasta, condiments for supermarkets to use as their house brands--about three years earlier for $5 billion.

The company is focusing on boosting the quality and prices of once-bargain brands such as Banquet and simplifying the ingredients of its products.

In its latest quarter, its grocery and snacks segment posted a 5.4% sales decline as prices and mix rose 1% but volumes fell 6%.

In its refrigerated and frozen segment, sales fell 8% as the company works stop using deep discounts to drive volume in its Banquet frozen meals. Volumes declined 11% as price and mix increased 3%.

The company said Lamb Weston had "outstanding performance" during the quarter, growing 4%, but the revenue fell 2% overall because of other divested businesses.

In all, ConAgra reported a profit of $186.2 million, or 42 cents a share, compared with a year-ago loss of $1.15 billion, or $2.65 a share. On an adjusted basis, earnings were 61 cents.

Sales fell 4.6% to $2.68 billion.

Analysts polled by Thomson Reuters had expected adjusted earnings per share of 48 cents on revenue of $2.73 billion.

Shares rose 2% in premarket trading.

Write to Austen Hufford at austen.hufford@wsj.com

 

(END) Dow Jones Newswires

September 29, 2016 09:15 ET (13:15 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
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