TreeHouse says third-quarter results 'below expectations'
TreeHouse Foods announced today that Robert B. Aiken has resigned as president of the Oak Brook, Ill.-based company, which specializes in producing private brands packaged foods and beverages. TreeHouse also announced that 2017 third-quarter net sales decreased 2.4 percent when compared to the same period last year.
“We are disappointed by Bob's decision and his resulting departure and wish him well in his future endeavors," TreeHouse Chairman and CEO Sam K. Reed said in a news release the company issued today. Reed will assume the role of president.
“I look forward to working with our strong and capable leadership team and our active board of directors to continue driving the business forward,” Reed said.
TreeHouse, also announced third-quarter earnings per fully diluted share of $0.50 compared to earnings of $0.65 reported for the third quarter of 2016. The company reported adjusted earnings per fully diluted share for the third quarter of $0.67 compared to adjusted earnings of $0.70 for the third quarter of 2016.
"We are disappointed that third-quarter results came in below our expectations,” Reed said. “Aggregate sales were relatively flat excluding the soup divestiture and operations struggled as we faced further unanticipated volume pressure, increased manufacturing complexity, and retail bid pricing compression in several segments.”
Reed said “private label is of great and growing importance for our customers, and our fundamental vision and strategy remain constant.”
Matthew Foulston, chief financial officer of TreeHouse, said continued weakness in operating earnings was only partially offset by greater expense control, reduced variable incentive compensation and favorable taxes.
“We must intensely focus the company on a back-to-basics strategy that improves our cost structure, enhances service levels and advances our commercialization capabilities,” Foulston added.
TreeHouse also announced its board of directors approved a $400 million share repurchase authorization representing about 10 percent of shares outstanding.
“We believe it is necessary to take incremental steps to improve our competitive position, including enhancing our revenue and margin management capabilities and a comprehensive review of selling, general and administrative costs," Reed said.
TreeHouse said it remains on track for Phase 1 of its TreeHouse 2020 restructuring program, which consists of the closure of two manufacturing facilities and the downsizing of another.