By Debbie Cai
Landec Corp.'s /zigman2/quotes/202795542/composite LNDC +2.12% fiscal second-quarter earnings more than doubled as the food-packaging manufacturer raked in more sales in its largest unit and reversed a liability charge related to a recent acquisition.
Results surpassed analysts' expectations, and the company also raised its full-year guidance. For fiscal 2013, Landec now anticipates net income to grow 60% to 70% and revenue to increase 33% to 38%. It previously projected net income growth of 25% to 35% and a revenue increase of about 30%.
Landec, which makes temperature-activated packaging like "breathable" wrap for produce and other products, has continued to benefit from strong growth in its Apio business. Apio, a specialty packaged-food division offering precut vegetables, in April acquired GreenLine Holding Co. and expanded its national distribution network.
For the latest quarter, Landec's bottom line benefited from a $3.9 million reversal of earn-out liability from the GreenLine acquisition.
For the quarter ended Nov. 25, Landec reported a profit of $8.9 million, or 34 cents a share, up from $3.3 million, or 13 cents a share, a year earlier. Revenue grew 41% to $114.7 million.
Analysts surveyed by Thomson Reuters expected a per-share profit of 16 cents on revenue of $103 million.
Gross margin widened to 16.2% from 15.9%.
The Apio food-products business--the key contributor to the company's top line--reported revenue climbed 50% to $106.7 million, driven by its value-added, fresh-cut vegetable segment where revenue rose 68%. Sales at its Lifecore unit fell 16%.
The company also said it restated its financial statements for the first quarter of fiscal 2013 to reflect a $2.9 million increase in the previously reported fair-market value of Windset Holdings 2010 Ltd., due to miscalculations. Subsequently, per-share earnings for the first quarter are up to 17 cents from the 10 cents previously reported.
Shares closed at $9.82 and were unchanged in recent after-hours trading. The stock is up 78% over the past 12 months.
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