020936 ConAgra Beats Wall Street Estimates

Omaha, NE (AP) - ConAgra Foods Inc. reported a 20% profit increase for its first quarter, beating analysts' expectations. It also completed the sale of its fresh beef and pork operations.

The nation's second largest food company behind Kraft Foods earned $227.6 million, or 43 cents a share, for the period that ended Aug. 25, up from $188.4 million, or 36 cents per share, last year.

Sales fell to $7.06 billion from $7.61 billion a year ago. ConAgra said the decrease was because of lower selling prices and volumes for some products.

The consensus forecast of analysts surveyed by Thomson First Call was for first-quarter earnings of 40 cents per share.

Chief executive Bruce Rohde said the year is off to a solid start. ConAgra brands include La Choy, Peter Pan, Orville Redenbacher's, Armour, Banquet and Hunts.

"Our food business is performing well year over year and well relative to the industry," he said. "We think fiscal 2003 will be as solid as fiscal 2002 with steady improvement in our business fundamentals."

Sales of packaged foods decreased 2.7% to $2.85 billion while operating profit in the division increased 11.5% to $357.4 million, ConAgra said.

Sales in its food ingredients were about the same as last year at $422.2 million, with operating profit declining 23.6% to $34.9 million because of increased product costs and lower overall volumes.

An investment group completed its purchase of ConAgra's fresh beef and pork operations Thursday afternoon. The financial details of the purchase were not disclosed. The sale had been said to be worth about $1.4 billion.

ConAgra will continue to work with new owners Hicks, Muse, Tate and Furst Inc. of Dallas and Booth Creek Management Inc. of Vail, Colo., said Chris Kircher, company spokesman.

He said the new operation, Swift and Company, will be a supplier to Omaha-based ConAgra Foods.

Announced in May, the deal was to close in August, but it was delayed when ConAgra Beef had nearly 19 million pounds of ground beef recalled because of E. coli contamination at its plant in Greeley, Colo.

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