NYSE$LW
Lamb Weston Holdings Inc · Q4 2022 earnings
Q4 2022 earnings · · Investor relations
Briefing
Lamb Weston's Q4 2022 results reflected a strong finish to the year, with record high sales and double-digit growth across core segments.
Lamb Weston reported a 14% increase in net sales to $1,153 million and a 38% increase in income from operations to $136 million compared to the fourth quarter of fiscal 2021. Net income decreased by 51% to $32 million, but adjusted net income increased by 45% to $95 million. Diluted EPS decreased by 50% to $0.22, while adjusted diluted EPS increased by 48% to $0.65.
- Net sales increased 14% to $1,153 million.
- Income from operations increased 38% to $136 million.
- Net income decreased 51% to $32 million; Adjusted Net Income increased 45% to $95 million.
- Diluted EPS decreased 50% to $0.22 from $0.44; Adjusted Diluted EPS increased 48% to $0.65.
Headline financials
Revenue & EPS history
Lamb Weston · Revenue · Quarterly
$1.15B
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
The Company expects net sales of $4.7 billion to $4.8 billion, net income of $360 million to $410 million, Diluted EPS of $2.45 to $2.85.
Tailwinds
- Net sales of $4.7 billion to $4.8 billion, with growth versus the prior year driven by the benefit of pricing actions to offset significant input and transportation cost inflation, as well as favorable mix and higher volume.
- Net income of $360 million to $410 million, Diluted EPS of $2.45 to $2.85, and Adjusted EBITDA including unconsolidated joint ventures in the range of $840 million to $910 million, with growth versus the prior year driven by higher sales and gross margin expansion.
- SG&A of $475 million to $500 million, reflecting increased investments to upgrade its information systems and enterprise resource planning (ERP) infrastructure, as well as higher compensation and benefits costs.
- Gross margins will improve and approach its normalized annual rate of 25 percent to 26 percent during the second half of fiscal 2023.
- The anticipated improvement is predicated on a potato crop harvested in fall 2022 that is in line with historical averages, the continued successful implementation of the Company’s pricing actions to offset input and transportation costs inflation, and a broad easing of labor and logistics pressures.
Headwinds
- Gross margins will be pressured as compared to normalized seasonal rates during the first half of fiscal 2023.
- Significant inflation for key production inputs, transportation and packaging, as well as higher raw potato costs on a per pound basis due to the impact of extreme summer heat that negatively affected the yield and quality of potato crops in the Pacific Northwest in fall 2021 will pressure gross margins.
- Gross margins will also be pressured by ongoing industrywide operational challenges, including labor and commodities shortages, resulting from volatility in the broader supply chain.
- Cash used for capital expenditures of $475 million to $525 million.
- Approximately $285 million is related to the previously-announced construction of french fry production lines and plant modernization investments in Idaho and China, as well as capital investments to upgrade information systems and ERP infrastructure.
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 Q4 2022
-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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