Lancaster Colony Corp. (NASDAQ:LANC) stock fell 0.058% (As on August 23, 11:20:20 AM UTC-4, Source: Google Finance) after the company posted lower than expected results for the fourth quarter of FY 24.  Retail segment net sales declined 0.8% in the quarter to $234.2 million, driven by the impact of the tactical decision to exit the perimeter-of-the-store bakery product lines this past March. Foodservice segment net sales were essentially flat at $218.6 million as deflationary pricing offset volume growth. The gross profit grew 4.8% to $97.6 million. Operating income increased to $41.7 million, which includes the impact of restructuring and impairment charges that totaled $2.7 million in the current year quarter versus $25 million in last year’s fourth quarter.

Moreover, in the retail segment, net sales declined 80 basis points to $234.2 million, excluding all sales associated with the perimeter bakery lines that the company exited. Retail segment sales increased 1.4%, while the segment’s volume measured in pounds shipped increased 1.2%. This was led by the newly introduced subway sandwich sauces and Texas Roadhouse steak sauces in addition to higher sales for Olive Garden dressings and Chick-fil-A refrigerated dressing. The New York Bakery frozen garlic bread products also performed well in the quarter, led by the growth of the own Texas toast and supported by the growth of the garlic bread sticks. The sales for the licensed items grew 8% with the newly introduced subway and Texas Roadhouse sauces leading the way, while Chick-fil-A, refrigerated dressings and Buffalo Wild Wings sauces also contributed to sales growth. The combined sales of Chick-fil-A refrigerated dressings and the Marzetti brand refrigerated dressings grew 11.3% to $39 million in the quarter, which increased the category leading share 330 basis points to 27.4%. Sales of the New York frozen bakery garlic bread product lines were up 2.8% to $94.7 million for a category leading share of 40.6%.
In the foodservice segment, strong volume growth of 4.2% driven by national chain restaurants was offset by the unfavorable impact of deflationary pricing.

LANC in the fourth quarter of FY 24 has reported the adjusted earnings per share of $1.26, missing the analysts’ estimates for the adjusted earnings per share of $1.38. The company had reported the adjusted revenue decline of 0.4 percent to $452.8 million in the fourth quarter of FY 24, missing the analysts’ estimates for revenue of $462.3 million.