CHICAGO — Conagra Brands Inc. reported net sales declined 1.4% in its first quarter to $2.6 billion, representing a slight beat of analyst expectations of $2.59 billion.
Organic net sales declined 1.1% in the quarter ended August 30. Volume declined 2.1% from a year earlier, but that was partially offset by an uptick in pricing and product mix.
Adjusted gross profit declined 3.9% to $619 million, as cost inflation and lower sales volumes outweighed productivity gains and about $4 million in tariff refunds.
CEO John Brase said the first-quarter performance represents a solid start to Conagra’s fiscal 2027. "While there is more work to be done, we remain on track to deliver for the year," he said.
Conagra reiterated expectations for volume declines in the mid-single digits for the full year, citing consumers’ ongoing price sensitivity.
Conagra's food service segment was a relative bright spot, with net sales rising 3.2% to $273 million on a 2.5% organic volume increase.
The grocery and snacks segment posted a 2.6% decline in net sales. In the refrigerated and frozen category, net sales declined 2.1%, while favorable foreign exchange rates helped lift the international segment to a 2.7% net sales gain.
Conagra recently turned to Brase to replace Sean Connolly as president and chief executive officer at what has been a challenging time for North America’s largest frozen food manufacturer.
Brase, who has experience at J.M. Smucker Co. and Procter & Gamble Co., joined Conagra on June 1 with aims of rekindling growth and unlocking the potential of brands being buffeted by higher costs and changing preferences among consumers looking for healthier, less processed food.
In response, the company is leaning into healthy aging, betting that innovation focused on protein, portion control, health and value will unleash sustainable profits.
