LONDON, UK / ACCESSWIRE / January 17, 2018 / Active-Investors.com has just released a free earnings report on Lamb Weston Holdings, Inc. (NYSE: LW). If you want access to this report all you need to do is sign up now by clicking the following link www.active-investors.com/registration-sg/?symbol=LW. Lamb Weston reported its second quarter fiscal 2018 operating and financial results on January 04, 2018. The frozen foods supplier surpassed earnings estimates and also provided guidance for the fiscal year 2018. Register today and get access to over 1,000 Free Research Reports by joining our site below:

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Earnings Highlights and Summary

Lamb Weston's net sales were $824.6 million for the quarter ended November 26, 2017, up 4% compared to net sales of $790.7 million for Q2 FY17. The Company's Price/Mix increased 5% on a y-o-y basis in the reported quarter, due to pricing actions and favorable product and customer mix, while Volume declined 1%. Lamb Weston's revenue numbers exceeded analysts' estimates of $9.31 million.

During Q2 FY18, Lamb Weston's income from operations rose 11% to $139.8 million compared to $125.5 million in Q2 FY17, and included $4.0 million of costs related to the spinoff from Conagra Brands, Inc. A portion of the increase reflected the impact of $9.0 million of expenses incurred in the prior year's same period related to the spinoff from Conagra. For Q2 FY18, Lamb Weston's adjusted earnings before interest, tax, depreciation, and amortization (EBITDA), including unconsolidated joint ventures, was $188.9 million, up 12% on a y-o-y basis, reflecting growth in income from operations and equity method investment earnings.

Lamb Weston's diluted earnings per share (EPS) declined to $0.52 in Q2 FY18 from $0.59 in Q2 FY17, while adjusted diluted EPS declined to $0.54 in the reported quarter from $0.63 in the prior year's same period. The declines were primarily driven by higher interest costs related to debt incurred in connection with the spinoff and higher tax expense, partially offset by growth in income from operations and equity method investment earnings. The Company's earnings exceeded Wall Street's estimates of $0.53 per share.

Lamb Weston Holdings' Segment Results

During Q2 FY18, Lamb Weston's net sales for the Global segment, which is comprised of the top 100 North American-based restaurant chain customers as well as the Company's international business, grew 1% to $416.9 million on a y-o-y basis. The segment's price/mix advanced 3% compared to the year period, largely reflecting price increases and improvement in customer and product mix. The segment's volume declined 2% on a y-o-y basis. The decline in volume was attributable to the elimination of less-profitable volume in North America and internationally as well as lower shipments to certain export markets.

For Q2 FY18, the Global segment's Product contribution margin declined 4% to $88.2 million on a y-o-y basis, with favorable price/mix offsetting commodity, manufacturing, transportation, and warehousing cost inflation.

During Q2 FY18, Lamb Weston's net sales for the Foodservice segment, which services North American foodservice distributors and restaurant chains outside the top 100 North American-based restaurant chain customers, grew 9% to $272.8 million on a y-o-y basis. The segment's price/mix increased 8% on a y-o-y basis, reflecting the carryover effect of pricing actions taken in fiscal year 2017, pricing actions implemented in the reported year, and improvement in customer and product mix. The segment's Volume edged up 1% on a y-o-y basis as a result of broad-based growth across the segment's customer base. The Foodservice segment's product contribution margin advanced 15% to $92.2 million, driven by favorable price/mix.

During Q2 FY18, Lamb Weston's net sales for the Retail segment, which includes sales of branded and private label products to grocery, mass merchant, and club customers in North America, advanced 6% to $102.0 million on a y-o-y basis. The segment's price/mix advanced 4% on a y-o-y basis, due to higher prices across the branded and private label portfolio, as well as improved mix. The segment's volume gained 2% on a y-o-y basis, primarily driven by distribution gains of Grown in Idaho as well as growth of Alexia and other branded products.

For Q2 FY18, the Retail segment's Product contribution margin declined 7% to $19.4 million, mainly due to higher trade spending as well as commodity, manufacturing, transportation, and warehousing cost inflation.

Outlook

For fiscal year 2018, Lamb Weston is forecasting net sales to grow mid-single digits, with price/mix and volume growth expected to improve in H2 FY18 as new pricing structures for an increasing number of customer contracts become effective and as the Company's new production capacity in Richland, Washington becomes available.

During FY18, Lamb Weston's adjusted EBITDA including unconsolidated joint ventures are projected to be in the range of $780 million to $790 million, including higher selling, general, and administrative (SG&A) expenses. Using the mid-point of the range, this represents an increase of approximately 13% versus fiscal 2017 pro-forma adjusted EBITDA including unconsolidated joint ventures of $692 million.

For FY18, Lamb Weston's cash used for capital expenditures is expected to be approximately $250 million, reflecting an increase of $25 million versus the previous estimate of $225 million.

Stock Performance Snapshot

January 16, 2018 - At Tuesday's closing bell, Lamb Weston Holdings' stock was marginally up 0.41%, ending the trading session at $58.52.

Volume traded for the day: 972.54 thousand shares, which was above the 3-month average volume of 946.57 thousand shares.

Stock performance in the last month ? up 4.87%; previous three-month period ? up 17.04%; past twelve-month period ? up 57.23%; and year-to-date ? up 3.67%

After yesterday's close, Lamb Weston Holdings' market cap was at $8.56 billion.

Price to Earnings (P/E) ratio was at 26.14.

The stock has a dividend yield of 1.32%.

The stock is part of the Consumer Goods sector, categorized under the Food - Major Diversified industry.

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