TreeHouse Foods, Inc. Reports Third Quarter 2015 Results

Nov. 5, 2015

OAK BROOK, Ill., Nov. 5, 2015 /PRNewswire/ -- TreeHouse Foods, Inc. today reported third quarter earnings of $0.65 per fully diluted share compared to $0.47 per fully diluted share reported for the third quarter of last year.  The Company reported adjusted earnings per share in the third quarter of $0.86 compared to $0.89 in the third quarter of the prior year, excluding the items described below.

Net sales for the third quarter totaled $798.6 million compared to $795.7 million last year, an increase of 0.4%, due to sales from acquisitions as an additional month of Flagstone results were in the third quarter of 2015 and not in 2014.  Partially offsetting the increase in net sales was unfavorable volume/mix, foreign exchange and lower pricing.  Compared to the third quarter of last year, sales in the third quarter of 2015 for the North American Retail Grocery segment increased 0.9%, sales for the Food Away From Home segment decreased 4.1% and sales for the Industrial and Export segment increased 1.5%..

Food Away From Home net sales for the third quarter of 2015 decreased 4.1% to $94.6 million from $98.7 million during the same quarter of the previous year, primarily due to volume/mix decreases of 2.9% and the unfavorable impact of foreign exchange, partially offset by increased pricing.  The Company posted a volume increase in the quarter in the Mexican and pasta sauces category that was more than offset by reductions in volumes of most other categories, reflecting increased competition.  Direct operating income margin in the third quarter increased to 13.6% in 2015 from 12.5% in 2014 due to favorable input costs.

Industrial and Export net sales for the third quarter increased 1.5% to $106.3 million from $104.7 million during the same quarter last year, largely driven by a 7.2% increase in volume/mix, partially offset by unfavorable foreign exchange and reduced pricing.  The volume/mix increase was primarily driven by the pickles and infant feeding products, while beverages (primarily single serve hot beverages) and soup products showed volume/mix declines.  Direct operating income margin in the third quarter decreased to 15.2% in 2015, from 16.0% in 2014.  Included in the third quarter of 2014 were $0.4 million of acquisition and integration costs that did not recur in 2015.  After considering the decline in acquisition and integration costs year-over-year, direct operating income margin decreased 110 basis points from last year, primarily due to a shift in sales mix resulting from competitive pressures, primarily in single serve hot beverages. Full report.