Lancaster Colony Corp.(NASDAQ: LANC) stock lost over 6.2% on August 17^th, 2017 (as of   1:59PM EDT; Source: Google finance) leading to a fall of over 17.5% in this year to date. For the fourth quarter of 2017, Sales in the foodservice channel lost 2.5% as the restaurant industry face pressure given the pressure in same-store sales and store traffic. Foodservice sales were hurt by residual deflationary pricing, Moreover, limited-time-offer programs with their national chain customers was flat during the quarter against pcp. Overall, the group’s Gross profit was also under pressure which fell $2.7 million to $72.5 million hurt by rising commodity costs, freight costs and the deflationary foodservice pricing. The group expects their Commodity costs to be modestly unfavorable during fiscal year of 2018, especially in the first half of the year. Meanwhile, Operating income fell to $42.6 million during the fourth quarter of 2017 as compared to $46.6 million in the pcp. Accordingly, for fiscal year of 2017, Operating income lost to $174.7 million against $184.6 million in pcp. Net income fell to $115.3 million during the year from $121.8 million pcp and earnings per diluted share lost to $4.20 from $4.44 in pcp.

On the other hand, Total net sales rose 1.9% yoy to $289.9 million during the fourth quarter of 2016. Retail net sales rose 6.1% with Olive Garden® dressings and Sister Schubert’s® frozen dinner rolls noted contributors to organic growth of 4.1%. The group’s acquisition, Angelic Bakehouse, a producer of sprouted grain bakery products drove the retail net sales performance. Rising trade spending and coupon expenses was offset by decrease in new product placement costs. For fiscal year of 2017, total net sales rose 0.9% to a record $1,202 million as compared to $1,191 million in the prior corresponding period. Retail net sales advanced 3.6% during the year but foodservice net sales lost 2.0% hurt by deflationary pricing and targeted business rationalization efforts in that channel.

For fiscal year of 2018, Angelic Bakehouse contribution coupled with contribution from their new product launches would drive their retail sales. For foodservice side, they planned initiatives to achieve profits from current customer base as well as new business relationships. The group forecasts a rising retail trade spending and consumer marketing expense for certain retail brands in the fiscal first quarter.