Lance Earnings: Here’s Why Investors are Not Excited Now

Lance, Inc. (NASDAQ:LNCE) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 1%.

Lance, Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 3.57% to $0.29 in the quarter versus EPS of $0.20 in the year-earlier quarter.

Revenue: Rose 1.86% to $419.8 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Lance, Inc. reported adjusted EPS income of $0.29 per share. By that measure, the company beat the mean analyst estimate of $0.26. It missed the average revenue estimate of $424.33 million.

Quoting Management: “This was an important and successful year for Snyder’s-Lance,” commented David V. Singer, Chief Executive Officer. “During 2012, we grew our earnings more than 35%, excluding special items, and grew our sales by 2.2% when the impact of our IBO conversion is excluded. We completed our merger integration, while we also rolled out and began to implement our strategic plan. In line with this plan, we delivered strong growth in our core branded items of Snyder’s of Hanover®, Lance® and Cape Cod®, and we acquired Snack Factory® and the fast growing Pretzel Crisps® brand. In 2012, we also invested in capacity and innovation capabilities while we improved margins on our non-branded items by discontinuing sales to certain customers who did not accept price increases. In the coming year, we’ll continue to build on this solid foundation as we drive for results that grow our top line and expand our margins through innovation and continued strong execution in the marketplace. Our new R&D center will open in 2013, and it will support aggressive innovation goals for our future.”

Key Stats (on next page)…

Revenue increased 3.25% from $406.57 million in the previous quarter. EPS increased 3.57% from $0.28 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $0.28 to a profit $0.26. For the current year, the average estimate has moved down from a profit of $0.93 to a profit of $0.92 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)