ConAgra Foods Inc. said Wednesday that its fourth-quarter earnings will be lower than it had forecast because of slow sales of its consumer foods products, such as Chef Boyardee, and weak profits for its private-brand businesses.
The packaged-foods company said that it now expects earnings of 55 cents a share for its fiscal fourth quarter, ended May 25, down from its previous projection of 60 cents a share.
Shares of the company fell as much as 6.8%, to $30.59, in early trading on Wall Street, their largest intraday decline in more than four months.
The company said it was hampered by a 7% decline in consumer foods volume and ongoing challenges with some of the company's retail brands, including the once-popular Chef Boyardee.
Chief Executive Gary Rodkin said the company expects to take a $681-million charge for the quarter.
"Given the challenges we faced in fiscal 2014 with regard to consumer foods volumes and private brands profitability, we are in the process of gradually strengthening several areas of our company," Rodkin said.
Based in Omaha, ConAgra is one of North America's largest packaged-foods companies and sells well-known consumer favorites, such as Healthy Choice, Snack Pack and Marie Callender's.
ConAgra also sells private-label products, such as Banquet brand, found in more than 90% of American households, but is facing stronger competition. Quarterly operating profit for its private brands is expected to fall by about $60 million, ConAgra said.
The company plans to release full quarterly results June 26.