Conagra Brands Inc 10-Q for FY2025 Q3

Conagra Brands Inc. (CAG)

10-Q 2025-04-03 For: 2025-02-23

Added on April 08, 2026

About this 10-Q

Conagra Brands Inc filed this 10-Q on April 3, 2025, covering the quarter ended February 23, 2025 (FY2025 Q3).

Headline figures

Quarter ended February 23, 2025, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $2.84B; down 6.3% from $3.03B a year earlier
Net income: $145.1M; down 53.0% from net income of $308.6M a year earlier
Diluted EPS: $0.30; down 53.1% from $0.64 a year earlier

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Delaware	47-0248710
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

222 W. Merchandise Mart Plaza, Suite 1300 Chicago, Illinois	60654
(Address of principal executive offices)	(Zip Code)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $5.00 par value	CAG	New York Stock Exchange


Large accelerated filer ☒	Accelerated filer ☐	Non-accelerated filer ☐	Smaller reporting company ☐	Emerging growth company ☐


PART I. FINANCIAL INFORMATION		1

Item 1	Financial Statements	1

	Unaudited Condensed Consolidated Statements of Earnings for the Thirteen and Thirty-Nine Weeks Ended February 23, 2025 and February 25, 2024	1

	Unaudited Condensed Consolidated Statements of Comprehensive Income for the Thirteen and Thirty-Nine Weeks Ended February 23, 2025 and February 25, 2024	2

	Unaudited Condensed Consolidated Balance Sheets as of February 23, 2025 and May 26, 2024	3

	Unaudited Condensed Consolidated Statements of Cash Flows for the Thirty-Nine Weeks Ended February 23, 2025 and February 25, 2024	4

	Notes to Unaudited Condensed Consolidated Financial Statements	5

Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21

Item 3	Quantitative and Qualitative Disclosures About Market Risk	29

Item 4	Controls and Procedures	29

PART II. OTHER INFORMATION		31

Item 1	Legal Proceedings	31

Item 1A	Risk Factors	31

Item 5	Other Information	31

Item 6	Exhibits	31

Signatures		32


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	February 23, 2025		February 25, 2024		February 23, 2025		February 25, 2024
Net sales	$	2,841.0	$	3,032.9	$	8,831.0	$	9,145.0
Cost of goods sold		2,130.7		2,174.1		6,534.7		6,616.5
Selling, general and administrative expenses		443.7		387.4		1,204.3		1,085.4
Other intangible asset impairment charges		—		—		18.9		—
Loss on divestitures		27.2		—		29.5		34.2
Pension and postretirement non-service income (expense)		3.1		(1.4)		9.3		(2.1)
Interest expense, net		100.9		106.5		314.9		325.8
Equity method investment earnings		47.4		41.2		125.0		131.0
Income before income taxes		189.0		404.7		863.0		1,212.0
Income tax expense (benefit)		43.9		95.9		(33.5)		297.1
Net income	$	145.1	$	308.8	$	896.5	$	914.9
Less: Net income attributable to noncontrolling interests		—		0.2		0.1		0.4
Net income attributable to Conagra Brands, Inc.	$	145.1	$	308.6	$	896.4	$	914.5
Earnings per share — basic
Net income attributable to Conagra Brands, Inc. common stockholders	$	0.30	$	0.64	$	1.87	$	1.91
Earnings per share — diluted
Net income attributable to Conagra Brands, Inc. common stockholders	$	0.30	$	0.64	$	1.87	$	1.91


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


	February 23, 2025		May 26, 2024
ASSETS
Current assets
Cash and cash equivalents	$	49.4	$	77.7
Receivables, less allowance for doubtful accounts of $3.1 and $3.0		769.9		871.8
Inventories		1,954.5		1,981.5
Prepaid expenses and other current assets		110.4		85.0
Current assets held for sale		81.4		133.5
Total current assets		2,965.6		3,149.5
Property, plant and equipment		6,433.2		6,314.3
Less accumulated depreciation		(3,694.2)		(3,493.3)
Property, plant and equipment, net		2,739.0		2,821.0
Goodwill		10,499.8		10,325.9
Brands, trademarks and other intangibles, net		2,487.1		2,484.8
Other assets		1,523.2		1,430.1
Noncurrent assets held for sale		529.8		651.0
	$	20,744.5	$	20,862.3
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Notes payable	$	877.7	$	928.4
Current installments of long-term debt		1,030.6		20.3
Accounts and other payables		1,421.4		1,493.7
Accrued payroll		144.5		193.3
Other accrued liabilities		826.8		588.6
Current liabilities held for sale		2.7		17.5
Total current liabilities		4,303.7		3,241.8
Senior long-term debt, excluding current installments		6,236.8		7,492.6
Other noncurrent liabilities		1,424.0		1,611.8
Noncurrent liabilities held for sale		0.9		4.8
Total liabilities		11,965.4		12,351.0
Common stockholders' equity
Common stock of $5 par value, authorized 1,200,000,000 shares; issued 584,219,229		2,921.2		2,921.2
Additional paid-in capital		2,342.3		2,363.2
Retained earnings		6,669.9		6,276.3
Accumulated other comprehensive loss		(42.9)		(35.5)
Less treasury stock, at cost, 106,856,759 and 106,050,133 common shares		(3,111.4)		(3,084.8)
Total Conagra Brands, Inc. common stockholders' equity		8,779.1		8,440.4
Noncontrolling interests		—		70.9
Total stockholders' equity		8,779.1		8,511.3
	$	20,744.5	$	20,862.3


	May 26, 2024
Current assets	$	32.0
Noncurrent assets (including goodwill of $46.4 million)		89.2
Current liabilities		14.8
Noncurrent liabilities		1.9


	Grocery &		Refrigerated
	Snacks		& Frozen		International		Corporate		Total
Accelerated depreciation	$	2.2	$	—	$	—	$	—	$	2.2
Other cost of goods sold		2.3		5.2		(0.1)		—		7.4
Total cost of goods sold		4.5		5.2		(0.1)		—		9.6
Severance and related costs		0.1		6.1		(0.3)		2.4		8.3
Asset impairment (net of gains on disposal)		2.7		65.1		(1.9)		—		65.9
Contract/lease termination		1.2		—		0.3		0.1		1.6
Other SG&A		2.3		2.1		0.7		0.2		5.3
Total SG&A		6.3		73.3		(1.2)		2.7		81.1
Total	$	10.8	$	78.5	$	(1.3)	$	2.7	$	90.7


			Costs
			Incurred and
	Balance at		Charged to		Costs Paid or		Changes in		Balance at
	May 26, 2024		Expense		Otherwise Settled		Estimates		February 23, 2025
Severance and related costs	$	9.8	$	9.1	$	(7.8)	$	(0.8)	$	10.3
Contract/lease termination		—		1.6		(1.6)		—		—
Other costs		0.6		8.3		(7.5)		—		1.4
Total	$	10.4	$	19.0	$	(16.9)	$	(0.8)	$	11.7



	Grocery & Snacks		Refrigerated & Frozen		International		Foodservice		Total
Balance as of May 26, 2024	$	4,486.8	$	4,916.6	$	202.4	$	720.1	$	10,325.9
Acquisitions		176.2		—		—		—		176.2
Currency translation		—		—		(2.3)		—		(2.3)
Balance as of February 23, 2025	$	4,663.0	$	4,916.6	$	200.1	$	720.1	$	10,499.8


	February 23, 2025				May 26, 2024
	Gross				Gross
	Carrying		Accumulated		Carrying		Accumulated
	Amount		Amortization		Amount		Amortization
Non-amortizing intangible assets
Brands and trademarks	$	1,853.7	$	—	$	1,816.8	$	—
Amortizing intangible assets
Customer relationships and intellectual property		1,214.9		581.5		1,210.6		542.6
	$	3,068.6	$	581.5	$	3,027.4	$	542.6


	Location in Condensed Consolidated Statements of Earnings of Gains (Losses)	Gains (Losses) Recognized on Derivatives in Condensed Consolidated Statements of Earnings for the Thirteen Weeks Ended
Derivatives Not Designated as Hedging Instruments	Recognized on Derivatives	February 23, 2025		February 25, 2024
Commodity contracts	Cost of goods sold	$	6.4	$	(6.6)
Foreign exchange contracts	Cost of goods sold		1.6		(1.7)
Total gains (losses) from derivative instruments not designated as hedging instruments		$	8.0	$	(8.3)


	February 23, 2025		May 26, 2024
Raw materials and packaging	$	297.2	$	297.8
Work in process		281.3		277.1
Finished goods		1,264.8		1,301.0
Supplies and other		111.2		105.6
Total	$	1,954.5	$	1,981.5


	Thirty-Nine Weeks Ended
	February 23, 2025						February 25, 2024
			Tax						Tax
	Pre-Tax		(Expense)		After- Tax		Pre-Tax		(Expense)		After- Tax
	Amount		Benefit		Amount		Amount		Benefit		Amount
Net income	$	863.0	$	33.5	$	896.5	$	1,212.0	$	(297.1)	$	914.9
Other comprehensive income:
Derivative adjustments:
Unrealized derivative adjustments		(0.8)		0.2		(0.6)		4.0		(1.0)		3.0
Reclassification for derivative adjustments included in net income		(5.3)		1.3		(4.0)		(6.2)		1.5		(4.7)
Currency translation adjustments:
Unrealized currency translation gains (losses)		(43.1)		—		(43.1)		9.1		—		9.1
Reclassification for currency translation losses in connection with the sale of Agro Tech Foods Limited (see Note 3)		79.8		—		79.8		—		—		—
Pension and postretirement benefit obligations:
Unrealized pension and postretirement benefit obligations		1.3		(0.2)		1.1		(7.2)		1.7		(5.5)
Reclassification for pension and postretirement benefit obligations included in net income		(3.5)		0.9		(2.6)		(2.5)		0.6		(1.9)
Comprehensive income		891.4		35.7		927.1		1,209.2		(294.3)		914.9
Comprehensive income (loss) attributable to noncontrolling interests (see Note 3)		38.1		—		38.1		—		(0.2)		(0.2)
Comprehensive income attributable to Conagra Brands, Inc.	$	853.3	$	35.7	$	889.0	$	1,209.2	$	(294.1)	$	915.1


	Thirty-Nine Weeks Ended
	February 23, 2025		February 25, 2024
Cash flows from operating activities:
Net income	$	896.5	$	914.9
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and amortization		294.9		291.7
Asset impairment charges		121.3		50.9
Equity method investment earnings less than (in excess of) distributions		(35.5)		69.5
Stock-settled share-based payments expense		36.1		18.7
Contributions to pension plans		(9.1)		(9.2)
Pension expense (benefit)		(2.3)		9.3
Other items		(5.5)		13.9
Change in operating assets and liabilities excluding effects of business acquisitions and dispositions:
Receivables		150.1		25.5
Inventories		71.0		73.3
Deferred income taxes and income taxes payable, net		(199.1)		43.1
Prepaid expenses and other current assets		(18.4)		(31.3)
Accounts and other payables		(48.2)		(36.5)
Accrued payroll		(47.4)		4.6
Other accrued liabilities		71.3		76.2
Litigation receivables, net of recoveries		(57.0)		—
Litigation accruals, net of payments		127.5		16.7
Net cash flows from operating activities		1,346.2		1,531.3
Cash flows from investing activities:
Additions to property, plant and equipment		(304.2)		(309.6)
Sale of property, plant and equipment		3.3		0.6
Purchase of marketable securities		—		(8.2)
Sale of marketable securities		—		8.2
Purchase of businesses, net of cash acquired		(230.6)		—
Proceeds from divestitures, net of cash divested		76.8		—
Proceeds from insurance recoveries		—		11.9
Other items		(2.5)		1.5
Net cash flows from investing activities		(457.2)		(295.6)
Cash flows from financing activities:
Issuance of short-term borrowings, maturities greater than 90 days		103.3		134.5
Repayment of short-term borrowings, maturities greater than 90 days		(103.3)		(146.6)
Net issuance (repayment) of other short-term borrowings, maturities less than or equal to 90 days		(52.6)		(461.7)
Issuance of long-term debt		—		500.0
Repayment of long-term debt		(274.8)		(766.8)


	Conagra Brands, Inc. Stockholders' Equity
								Accumulated
				Additional				Other
	Common	Common		Paid-in		Retained		Comprehensive		Treasury		Noncontrolling		Total
	Shares	Stock		Capital		Earnings		Loss		Stock		Interests		Equity
Balance at May 26, 2024	584.2	$	2,921.2	$	2,363.2	$	6,276.3	$	(35.5)	$	(3,084.8)	$	70.9	$	8,511.3
Stock option and incentive plans					(33.5)		(0.5)				34.8				0.8
Currency translation adjustments									22.5				38.0		60.5
Repurchase of common shares											(64.0)				(64.0)
Derivative adjustments									(3.3)						(3.3)
Activities of noncontrolling interests													(108.9)		(108.9)
Pension and postretirement healthcare benefits									0.2						0.2
Dividends declared on common stock; $0.35 per share							(167.8)								(167.8)
Net income attributable to Conagra Brands, Inc.							466.8								466.8
Balance at August 25, 2024	584.2	$	2,921.2	$	2,329.7	$	6,574.8	$	(16.1)	$	(3,114.0)	$	—	$	8,695.6
Stock option and incentive plans					7.8		(0.3)				1.3				8.8
Currency translation adjustments									(19.4)						(19.4)
Derivative adjustments									(1.0)						(1.0)
Pension and postretirement healthcare benefits									(0.8)						(0.8)
Dividends declared on common stock; $0.35 per share							(167.0)								(167.0)
Net income attributable to Conagra Brands, Inc.							284.5								284.5
Balance at November 24, 2024	584.2	$	2,921.2	$	2,337.5	$	6,692.0	$	(37.3)	$	(3,112.7)	$	—	$	8,800.7
Stock option and incentive plans					4.8		(0.1)				1.3				6.0
Currency translation adjustments									(4.4)						(4.4)
Derivative adjustments									(0.3)						(0.3)
Pension and postretirement healthcare benefits									(0.9)						(0.9)
Dividends declared on common stock; $0.35 per share							(167.1)								(167.1)
Net income attributable to Conagra Brands, Inc.							145.1								145.1
Balance at February 23, 2025	584.2	$	2,921.2	$	2,342.3	$	6,669.9	$	(42.9)	$	(3,111.4)	$	—	$	8,779.1


	Conagra Brands, Inc. Stockholders' Equity
								Accumulated
				Additional				Other
	Common	Common		Paid-in		Retained		Comprehensive		Treasury		Noncontrolling		Total
	Shares	Stock		Capital		Earnings		Loss		Stock		Interests		Equity
Balance at May 28, 2023	584.2	$	2,921.2	$	2,376.9	$	6,599.4	$	(44.4)	$	(3,116.3)	$	70.5	$	8,807.3
Stock option and incentive plans					(42.9)		1.1				25.6				(16.2)
Currency translation adjustments									10.7				(0.1)		10.6
Derivative adjustments									1.6						1.6
Activities of noncontrolling interests													0.2		0.2
Pension and postretirement healthcare benefits									(0.8)						(0.8)
Dividends declared on common stock; $0.35 per share							(167.3)								(167.3)
Net income attributable to Conagra Brands, Inc.							319.7								319.7
Balance at August 27, 2023	584.2	$	2,921.2	$	2,334.0	$	6,752.9	$	(32.9)	$	(3,090.7)	$	70.6	$	8,955.1
Stock option and incentive plans					5.6		(0.4)				1.1		0.3		6.6
Currency translation adjustments									(5.6)				(0.7)		(6.3)
Derivative adjustments									0.8						0.8
Pension and postretirement healthcare benefits									(1.0)						(1.0)
Dividends declared on common stock; $0.35 per share							(167.2)								(167.2)
Net income attributable to Conagra Brands, Inc.							286.2								286.2
Balance at November 26, 2023	584.2	$	2,921.2	$	2,339.6	$	6,871.5	$	(38.7)	$	(3,089.6)	$	70.2	$	9,074.2
Stock option and incentive plans					14.1		(1.0)				1.7				14.8
Currency translation adjustments									4.6				0.2		4.8
Derivative adjustments									(4.1)						(4.1)
Activities of noncontrolling interests													0.2		0.2
Pension and postretirement healthcare benefits									(5.6)						(5.6)
Dividends declared on common stock; $0.35 per share							(167.4)								(167.4)
Net income attributable to Conagra Brands, Inc.							308.6								308.6
Balance at February 25, 2024	584.2	$	2,921.2	$	2,353.7	$	7,011.7	$	(43.8)	$	(3,087.9)	$	70.6	$	9,225.5


	Pension Plans
	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	February 23, 2025		February 25, 2024		February 23, 2025		February 25, 2024
Service cost	$	1.4	$	1.5	$	4.1	$	4.4
Interest cost		34.4		36.1		101.8		109.5
Expected return on plan assets		(37.0)		(35.3)		(109.4)		(106.9)
Amortization of prior service cost		0.4		0.4		1.2		1.2
Settlement loss		—		1.1		—		1.1
Pension cost (benefit) — Company plans		(0.8)		3.8		(2.3)		9.3
Pension cost (benefit) — multi-employer plans		2.1		2.1		7.3		6.9
Total pension cost (benefit)	$	1.3	$	5.9	$	5.0	$	16.2


	Postretirement Plans
	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	February 23, 2025		February 25, 2024		February 23, 2025		February 25, 2024
Service cost	$	—	$	—	$	0.1	$	0.1
Interest cost		0.6		0.7		1.8		2.0
Amortization of prior service cost (benefit)		(0.4)		(0.4)		(1.3)		(1.2)
Recognized net actuarial gain		(1.1)		(1.2)		(3.4)		(3.6)
Total postretirement cost (benefit)	$	(0.9)	$	(0.9)	$	(2.8)	$	(2.7)


	February 23, 2025		May 26, 2024
Currency translation losses, net of reclassification adjustments	$	(90.5)	$	(89.2)
Derivative adjustments, net of reclassification adjustments		24.6		29.2
Pension and postretirement benefit obligations, net of reclassification adjustments		23.0		24.5
Accumulated other comprehensive loss	$	(42.9)	$	(35.5)


					Affected Line Item in the Condensed Consolidated Statement of
	Thirteen Weeks Ended				Earnings¹
	February 23, 2025		February 25, 2024
Net derivative adjustments:
Cash flow hedges	$	(0.7)	$	(0.9)	Interest expense, net
Cash flow hedges		(0.9)		(1.2)	Equity method investment earnings
		(1.6)		(2.1)	Total before tax
		0.4		0.5	Income tax expense
	$	(1.2)	$	(1.6)	Net of tax
Pension and postretirement liabilities:
Pension settlement	$	—	$	1.1	Pension and postretirement non-service income
Net prior service cost (benefit)		(0.1)		—	Pension and postretirement non-service income
Net actuarial gain		(1.1)		(1.2)	Pension and postretirement non-service income
		(1.2)		(0.1)	Total before tax
		0.3		—	Income tax expense
	$	(0.9)	$	(0.1)	Net of tax


	Level 1		Level 2		Level 3		Net Value
Assets:
Derivative assets	$	2.8	$	3.2	$	—	$	6.0
Deferred compensation assets		6.1		—		—		6.1
Available-for-sale debt securities		—		—		2.5		2.5
Total assets	$	8.9	$	3.2	$	2.5	$	14.6
Liabilities:
Derivative liabilities	$	—	$	—	$	—	$	—
Deferred compensation liabilities		71.2		—		—		71.2
Total liabilities	$	71.2	$	—	$	—	$	71.2


	Net Sales
($ in millions)	Thirteen Weeks Ended					Thirty-Nine Weeks Ended
Reporting Segment	February 23, 2025		February 25, 2024		% Inc (Dec)	February 23, 2025		February 25, 2024		% Inc (Dec)
Grocery & Snacks	$	1,245.4	$	1,286.0	(3.2)%	$	3,749.1	$	3,784.0	(0.9)%
Refrigerated & Frozen		1,115.6		1,202.4	(7.2)%		3,540.5		3,692.5	(4.1)%
International		223.9		271.7	(17.6)%		726.4		811.5	(10.5)%
Foodservice		256.1		272.8	(6.1)%		815.0		857.0	(4.9)%
Total	$	2,841.0	$	3,032.9	(6.3)%	$	8,831.0	$	9,145.0	(3.4)%


	Operating Profit
($ in millions)	Thirteen Weeks Ended					Thirty-Nine Weeks Ended
Reporting Segment	February 23, 2025		February 25, 2024		% Inc (Dec)	February 23, 2025		February 25, 2024		% Inc (Dec)
Grocery & Snacks	$	237.6	$	299.3	(20.6)%	$	779.9	$	837.2	(6.8)%
Refrigerated & Frozen		95.7		201.5	(52.5)%		374.3		620.9	(39.7)%
International		33.1		42.2	(21.5)%		107.6		71.8	49.8%
Foodservice		28.6		35.4	(19.2)%		99.5		117.5	(15.3)%


	Fair Value Impact
In Millions	February 23, 2025		February 25, 2024
Energy commodities	$	0.9	$	2.6
Agriculture commodities		6.3		6.0
Foreign exchange		8.0		9.2

EXHIBIT		DESCRIPTION

3.1		Restated Certificate of Incorporation of Conagra Brands, Inc., incorporated herein by reference to Exhibit 3.1 to the Company's Current Report on Form 8-K filed with the SEC on September 23, 2024

3.2		Amended and Restated Bylaws of Conagra Brands, Inc., incorporated by reference to Exhibit 3.1 of Conagra Brands' Current Report on Form 8-K filed with the SEC on May 21, 2024
31.1		Section 302 Certificate of Chief Executive Officer

31.2		Section 302 Certificate of Chief Financial Officer

32		Section 906 Certificates

101		The following materials from Conagra Brands' Quarterly Report on Form 10-Q for the quarter ended February 23, 2025, formatted in Inline XBRL (eXtensible Business Reporting Language): (i) the Condensed Consolidated Statements of Earnings, (ii) the Condensed Consolidated Statements of Comprehensive Income, (iii) the Condensed Consolidated Balance Sheets, (iv) the Condensed Consolidated Statements of Cash Flows, (v) Notes to Unaudited Condensed Consolidated Financial Statements, and (vi) document and entity information.

104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

	CONAGRA BRANDS, INC.

	By:	/s/ DAVID S. MARBERGER
		David S. Marberger
		Executive Vice President and Chief Financial Officer

	By:	/s/ WILLIAM E. JOHNSON
		William E. Johnson
		Senior Vice President and Corporate Controller


Date: April 3rd, 2025

/s/ SEAN M. CONNOLLY
Sean M. Connolly
Chief Executive Officer


April 3rd, 2025

/s/ SEAN M. CONNOLLY
Sean M. Connolly
Chief Executive Officer