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Sep 30, 2021
Lancaster Colony Q1 2022 Earnings Report
Lancaster Colony reported record sales, driven by retail segment growth and inflationary pricing in the foodservice segment, but experienced a decline in operating income due to higher costs.
Key Takeaways
Lancaster Colony reported a 12.3% increase in consolidated net sales to a record $392.1 million for the first quarter. The retail segment saw a 15.6% sales increase, while the foodservice segment grew by 8.1%. However, consolidated operating income declined by $8.4 million to $40.5 million due to increased costs.
Consolidated net sales increased 12.3% to a first quarter record of $392.1 million.
Retail segment net sales grew 15.6% to $223.9 million, driven by licensing programs and frozen garlic bread.
Foodservice segment net sales advanced 8.1% to $168.2 million, driven by inflationary pricing and volume growth.
Consolidated operating income declined $8.4 million to $40.5 million due to higher costs.
Lancaster Colony
Lancaster Colony
Lancaster Colony Revenue by Segment
Revenue by Segment
Retail Revenue
CapyFin.comFoodservice Revenue
CapyFin.com Forward Guidance
Looking ahead to the fiscal second quarter, Lancaster Colony anticipates continued growth in the retail segment from its licensing program and sustained demand in the foodservice segment. The company expects the inflationary environment to persist, with higher commodity, packaging, freight, and labor costs. Pricing actions and cost savings programs are expected to partially offset these unfavorable impacts.
Positive Outlook
- Licensing program to remain an important source of growth for Retail segment sales.
- Foodservice segment should continue to benefit from higher demand for branded Foodservice products.
- Growth from select quick-service restaurant and pizza chain customers in our mix of national chain restaurant accounts.
- Inflationary pricing in both Retail and Foodservice segments will help to partially offset the input cost inflation.
- Ongoing cost savings programs and other net price realization efforts will also serve to reduce the unfavorable impacts of inflation.
Challenges Ahead
- Inflationary environment to continue in the coming quarter.
- Higher commodity costs, particularly for soybean oil.
- Increased costs for packaging.
- Increased costs for freight.
- Increased costs for labor.
Revenue & Expenses
Visualization of income flow from segment revenue to net income