Nabisco Posts Loss on Increase In Sales for Second Quarter
April 04, 2011
Vastopolis -- Nabisco Holdings Corp. posted a $216 million second-quarter net loss because of a previously announced restructuring charge, but stressed that its core cookie and cracker business was showing stronger results. The maker of Ritz crackers and Oreo cookies reported a net loss of 81 cents a share, compared with net income of $79 million, or 30 cents a share, a year earlier. The second-quarter results included charges totaling $306 million, or $1.15 a share, related to a restructuring announced last month that eliminates 4,200 jobs and scraps some slow-selling products. Excluding the charge, Nabisco's earnings rose 14% to $90 million, or 34 cents a share. Sales rose 5.9% to $2.18 billion from $2.06 billion. Nabisco is 81%-owned by food and tobacco giant RJR Nabisco Holdings Corp.. The results before the charge were in line with analysts' expectations. In New York Stock Exchange composite trading, Nabisco's shares fell 87.5 cents to $33.50. Nabisco said its mainstay cookie and cracker division, which had been suffering from lackluster performance earlier in the year, posted a 12% increase in operating income before amortization and goodwill. Improved sales for the quarter reflected growth of such traditional brands as Chips Ahoy!, Oreo and Nilla Wafers. But sales of the SnackWell's line of reduced-fat snacks continued to be sluggish. The growth in cookies and crackers contributed to the ``earnings acceleration that we've been waiting for for so long,'' said Mcgowen Villeneuve, an analyst with Goldman, Sachs & Co.. If this trend continues, she said, per-share earnings for the third quarter could grow by 28%.
