NYSE$LW
Lamb Weston Holdings Inc · Q2 2024 earnings
Q2 2024 earnings · · Investor relations
Briefing
Lamb Weston's financial performance for Q2 2024 was solid, marked by increased net sales and earnings, but also included a charge for excess raw potatoes.
Lamb Weston's Q2 2024 results showed a 36% increase in net sales to $1,732 million, driven by the LW EMEA Acquisition. Net income increased by 109% to $215 million and diluted EPS increased by 108% to $1.48. However, results included a $71 million pre-tax charge for the write-off of excess raw potatoes.
- Net sales increased by 36% to $1,732 million, including $376 million from the LW EMEA Acquisition.
- Net income increased by 109% to $215 million, with diluted EPS rising to $1.48.
- Adjusted EBITDA increased 15% to $377 million.
- The company reaffirmed its net sales target of $6.8 billion to $7.0 billion for fiscal year 2024.
Headline financials
Revenue & EPS history
Lamb Weston · Revenue · Quarterly
$1.73B
Revenue by segment
Lamb Weston · $1.67B total across 2 segments · Q1 2024
- North America$1.14B—68.2%
- International$530M—31.8%
Forward guidance
Lamb Weston updated its financial targets for fiscal 2024, reaffirming net sales target of $6.8 billion to $7.0 billion and Adjusted EBITDA target range of $1,540 million to $1,620 million. The company increased its targets for GAAP net income to $830 million to $900 million and Adjusted Net Income target to $830 million to $900 million.
Tailwinds
- Reaffirming net sales target of $6.8 billion to $7.0 billion, including $1.1 billion to $1.2 billion of incremental sales attributable to the consolidation of the financial results of LW EMEA during the first three quarters of the fiscal year.
- The Company continues to target net sales, excluding incremental sales attributable to the LW EMEA Acquisition, to grow 6.5 percent to 8.5 percent, with price/mix expected to increase low-double-digits percentage points.
- Increased targets for GAAP net income to $830 million to $900 million and Diluted EPS of $5.70 to $6.15, including a net loss from foreign currency exchange and unrealized mark-to-market derivative gains and losses and items impacting comparability of $2.0 million ($1.4 million after-tax, or $0.01 per share) during the first half of fiscal 2024.
- Reaffirmed target range for Adjusted EBITDA(2) to $1,540 million to $1,620 million (+27 percent compared to fiscal 2023 using the mid-point), which includes a $70.9 million pre-tax charge(1) for the write-off of excess raw potatoes.
- Raised Adjusted Net Income(2) target to $830 million to $900 million and its Adjusted Diluted EPS(2) target to $5.70 to $6.15. The increases in these targets reflect the lower SG&A expense estimate as well as a lower interest expense estimate of $140 million to account for revised project-related capitalized interest.
Headwinds
- The Company continues to target sales volumes to decline mid-single-digits percentage points, largely reflecting the carryover impact of the Company’s decisions to strategically manage customer and product mix by exiting certain lower-priced and lower-margin business in the prior year.
- The Company expects gross profit growth will be partially offset by SG&A of $745 million to $755 million.
- Cash used for capital expenditures of $900 million to $950 million, up from the Company’s previous estimate of $800 million to $900 million, reflecting the timing of expenditures related to the construction of previously-announced capacity expansion efforts in China, Idaho, the Netherlands and Argentina.
- Non-GAAP results include a $70.9 million charge ($53.9 million after-tax, or $0.37 per share) related to a write-off of excess raw potatoes.
- The total charge to the reporting segments was as follows: $63.3 million to the North America segment and $7.6 million to the International segment.
Historical earnings impact
How earnings announcements have historically affected this stock's price.
Avg. return before/after earnings
Based on 19 quarterly earnings reports · overlaid with Q2 2024
-1.3%
Avg return
Earnings day
-1.2%
Avg return
5 days after
+0.1%
Avg return
30 days after
52%
23 / 44 earnings
Positive
+13.9%
Q2 2023
Best reaction
-32.6%
Q4 2024
Worst reaction
| Quarter | Report date | Reaction (Day 0) | +5 days | +30 days |
|---|---|---|---|---|
| Q3 2026 | -0.6% | -2.8% | — | |
| Q2 2026 | -25.0% | -28.4% | -27.0% | |
| Q1 2026 | +4.5% | +13.0% | +11.7% | |
| Q4 2025 | -2.1% | -2.4% | -1.5% | |
| Q3 2025 | +10.0% | -3.1% | -4.9% | |
| Q2 2025 | -20.6% | -18.6% | -23.2% | |
| Q1 2025 | +2.8% | +6.3% | +20.0% | |
| Q4 2024 | -32.6% | -28.5% | -20.3% | |
| Q3 2024 | -21.1% | -20.5% | -15.9% | |
| Q2 2024 | +1.0% | +2.4% | +1.1% | |
| Q1 2024 | +3.3% | +6.5% | +4.0% | |
| Q4 2023 | -9.7% | -9.4% | -15.1% | |
| Q3 2023 | +3.0% | +3.7% | +7.6% | |
| Q2 2023 | +13.9% | +12.1% | +12.2% | |
| Q1 2023 | +4.9% | +5.2% | +8.4% | |
| Q4 2022 | +6.7% | +7.3% | +7.4% | |
| Q3 2022 | +9.7% | +9.6% | +4.5% | |
| Q2 2022 | +11.3% | +9.8% | -0.6% | |
| Q1 2022 | -9.5% | -11.6% | -7.5% | |
| Q4 2021 | -12.2% | -12.2% | -15.2% | |
| Q3 2021 | -4.1% | -2.8% | -2.4% | |
| Q2 2021 | +0.3% | -2.0% | +3.7% | |
| Q1 2021 | +5.9% | +3.5% | -5.4% | |
| Q4 2020 | -15.2% | -14.8% | -11.4% | |
| Q3 2020 | -12.6% | -9.2% | +2.2% | |
| Q2 2020 | +7.9% | +8.5% | +8.6% | |
| Q1 2020 | +5.9% | +3.2% | +5.4% | |
| Q4 2019 | -6.0% | -4.3% | +2.9% | |
| Q3 2019 | -1.2% | -3.2% | -10.3% | |
| Q2 2019 | -3.3% | -4.5% | -0.8% | |
| Q1 2019 | +9.6% | +13.3% | +17.1% | |
| Q4 2018 | +2.5% | +2.8% | -1.9% | |
| Q3 2018 | +4.0% | +7.3% | +9.5% | |
| Q2 2018 | +2.9% | +3.5% | +1.3% | |
| Q1 2017 | +3.0% | +3.5% | +10.5% | |
| Q1 2018 | +3.0% | +3.5% | +10.5% | |
| Q4 2015 | -1.1% | -2.1% | +0.6% | |
| Q1 2016 | -1.1% | -2.1% | +0.6% | |
| Q4 2017 | -1.1% | -2.1% | +0.6% | |
| Q3 2016 | +3.0% | +2.7% | -0.4% | |
| Q3 2017 | +3.0% | +2.7% | -0.4% | |
| Q4 2016 | +0.0% | +0.9% | +5.9% | |
| Q2 2017 | +0.0% | +0.9% | +5.9% | |
| Q2 2016 | +0.0% | +0.9% | +5.9% |
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