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Flowers Foods’ Q2 2018 EPS: Wall Street’s Projections

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Bottom line expectations

Analysts expect Flowers Foods (FLO) to report adjusted EPS of $0.28 compared to its adjusted EPS of $0.24 in the same quarter last year. Its adjusted net income is expected to be $58.3 million compared the $50.5 million it reported in the corresponding quarter last year.

The company is set to report its earnings results on August 8.

FLO’s adjusted EBITDA is expected to be $114.8 million in the second quarter compared to $113.7 million in the second quarter of 2017. Its adjusted EBITDA is likely to benefit from higher sales and operational efficiencies.

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Past EPS performance

Flowers Foods’ first-quarter adjusted EPS of $0.30 missed analysts’ expectation of $0.31. The company’s adjusted EPS were up 20% on a YoY basis. Its adjusted net income was $63.2 million compared to $52.6 million in the first quarter of fiscal 2017. Its adjusted EBITDA was $132.9 million, almost unchanged on a YoY basis. However, its adjusted EBITDA margin of 11% was down 20 basis points on a YoY basis.

On a reported basis, its EPS fell to $0.24 from $0.29 YoY. Lower operating income and the recording of $4.7 million in pension plan settlement losses negatively affected its bottom line.

Flowers Foods has warned that it’s likely to see a $40 million increase in commodity costs in 2018. To combat this situation, the company is looking to save $38 million–$48 million through its Project Centennial. Project Centennial is the company’s cost-saving initiative, under which the company is cutting costs by right-sizing its operations and streamlining its supply chain.

Peers’ expectations and performances

Analysts expect the Campbell Soup Company (CPB) to report adjusted EPS of $0.25, down 51.9% on a YoY basis, in its fiscal fourth quarter. Conagra (CAG) reported its fiscal fourth-quarter results on June 28. The company’s adjusted EPS came in at $0.50, which beat analysts’ estimate by 13.6%.

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