Sara Lee, the US-based food and household goods group, has reported third quarter sales of $4.4 billion (€3.99), up 4 per cent on the same period a year earlier as a result of positive exchange rates.
But volume sales were down 2 per cent in the third quarter - and by 1 per cent for the first three-quarters of the year, despite value increases from all five business units.
"We remain committed to our strategic plans for growth in this challenging economic environment," said C. Steven McMillan, chairman, president and chief executive officer of Sara Lee Corporation.
"Sara Lee's businesses continue to benefit from incremental cost savings and increased productivity related to previous restructuring activities. In addition, our heightened investment in new product initiatives and our strategy to increase marketing support for our largest, most important brands are together driving higher growth rates for our key brands.
"In recent months, we have seen some of these benefits offset by slower retail sales and a weaker environment for foodservice products, but we continue to focus our resources to provide convenient, everyday items that look, feel or taste terrific."
In the meat division, Sara Lee Deli Meats and Jimmy Dean Fresh Taste. Fast! breakfast products continued to improve sales during the quarter, helped by a 13 per cent increase in media spend. However, overall third quarter sales were flat at $871 million, and in fact fell by 3 per cent excluding the impact of acquisitions, divestitures and favourable foreign currency rates.
Profits from the meat arm fell 7 per cent to $72 million in the third quarter, although excluding the positive effect of currency exchanges, profits were 12 per cent lower. Sara Lee Bakery's third quarter sales declined 1 per cent to $871 million as lower volumes in regional fresh bread brands and foodservice in the United States offset increased sales in Europe and Australia. Excluding acquisitions and the strengthening of foreign currencies versus the dollar, sales for the quarter fell 4 per cent. Profits for the quarter declined to $11 million from $29 million a year ago.
At the Sara Lee Beverage unit - which produces roast and ground coffee - sales rose 18 per cent in the third quarter (7 per cent excluding the impact of changes in foreign currency rates and acquisitions). Business trends continued to be mixed in the quarter, with sales gains in Europe and Brazil offset by weakness in the United States. Profits for the division were ahead 16 per cent in the three month period.