Sara Lee Corp. Earnings: Profit Streak Snapped by a Loss

S&P 500 (NYSE:SPY) component Sara Lee Corp. (NYSE:SLE) reported its results for the first quarter. Sara Lee is a global consumer-goods company. The company manufactures a range of branded meats, bakery and beverage products.

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Sara Lee Corp Earnings Cheat Sheet for the First Quarter

Results: Reported a loss of $217 million (37 cents per diluted share) in the quarter. Sara Lee Corp. had a net income of $192 million or 29 cents per share in the year earlier quarter.

Revenue: Rose 12.5% to $1.94 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: SLE reported adjusted net income of 21 cents per share. By that measure, the company beat the mean estimate of 17 cents per share. It fell short of the average revenue estimate of $1.99 billion.

Quoting Management: “Weare moving forward aggressively,preparing our Meat and Coffee& Tea businesses for strong futures as independent pure-play companies,” said Sara Lee Executive Chairman, Jan Bennink.”Within the past month we have closed the sale of North American refrigerated dough to Ralcorp and announced the sales of Spanish bakery to Grupo Bimbo and the majority of the North American foodservice beverage operations to J.M. Smucker.We have also gained DOJ approval on the North American Fresh Bakery sale to Grupo Bimbo.These actions demonstrate our progress toward the creation of two focused entities that are poised for long-term growth.Meanwhile, we are increasing our investment in the future, with strong support behind core brands and new product development.The solid performance of our base business and our exciting pipeline of innovation give me great confidence that both companies are positioned for successful futures.”

Key Stats:

Revenue gains this quarter snap a three-quarter streak of decreases. Revenue declined 25.9% to $2.05 billion in the fourth quarter of the last fiscal year. The figure fell 13.9% in the third quarter of the last fiscal year from the year earlier and dropped 17.8% in the second quarter of the last fiscal year from the year-ago quarter.

The company’s loss in the latest quarter follows profits in the previous three quarters. The company reported a profit of $111 million in the fourth quarter of the last fiscal year, a profit of $153 million in the third quarter of the last fiscal year and $880 million in the second of the last fiscal year.

The company beat estimates last quarter after being in line with expectations in the fourth quarter of the last fiscal year with net income of 20 cents per share.

Looking Forward: Over the past ninety days, the average estimate for the second quarter has fallen from 31 cents per share to 25 cents, indicating that analysts are growing pessisimistic about the company’s performance next quarter. The average estimate for the fiscal year is 92 cents per share, down from $1.07 ninety days ago.

Competitors to Watch: Unilever plc (NYSE:UL), Bridgford Foods Corp. (NASDAQ:BRID), The Hain Celestial Group, Inc. (NASDAQ:HAIN), Lancaster Colony Corp. (NASDAQ:LANC), J&J Snack Foods Corp. (NASDAQ:JJSF), Kraft Foods Inc. (NYSE:KFT), Flowers Foods, Inc. (NYSE:FLO), Snyder S Lance Inc (NASDAQ:LNCE), Green Mountain Coffee Roasters Inc. (NASDAQ:GMCR), and TreeHouse Foods Inc. (NYSE:THS).

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(Source: Xignite Financials)