Meat Industry INSIGHTS Newsletter

980440 Sara Lee Sees 13-15 Pct FY99 EPS Growth

April 23, 1998

Chicago - Consumer products maker Sara Lee Corp. it expected basic earnings per share growth to be in the 13% to 15% range in fiscal 1999.

“We have not yet finalized our plans for fiscal 1999, but we continue to expect basic earnings per share growth in the 13% to 15% range,” Janet Bergman, vice president of investor relations, said in a conference call with analysts and reporters.

“For the fourth quarter overall, we expect basic earnings per share to increase in line with the 14% projection that (president and chief operating officer) Steve McMillan discussed in February of this year,” she said.

Earlier today, Sara Lee reported third quarter diluted earnings of $0.46 a share, in line with analysts' expectations, according to estimates compiled by First Call. Last year, Sara Lee earned $0.40 a share in the third quarter.

Sara Lee, which makes a variety of products ranging from Ball Park hot dogs to Hanes underwear, recorded quarterly sales of $4.74 billion, up from the year-ago level of $4.65 billion.

“Three of our lines of business -- packaged meats and bakery, coffee and grocery, and household and body care -- are on or above plan,” Bergman said. “They each showed improving operating trends in the third quarter versus the first half, and should continue to produce strong results in the fourth quarter as well.”

Sales in the packaged meat and bakery business rose to $1.865 billion, up 4.3% from $1.788 billion in the same quarter a year ago.

Coffee and grocery sales were $683 million in the quarter, little changed from the previous year's $684 million. Sales in household and body care rose 9.9% to $492 million, up from $448 million the year before.

Personal products sales fell in the quarter, due in part to slower demand for Champion brand fleece and activewear. Sales were down about two percent at $1.699 billion, compared with $1.732 billion in the third quarter a year ago.

“Personal products results are mixed, and although third quarter flat operating profits were an improvement over the first half, we do expect further weakness for the fourth quarter,” Bergman said.

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