Annie's falls as co. revises fiscal 2014 outlook

Annie's drops as co. now expects fiscal 2014 adjusted earnings at lower end of its forecast

Associated Press

NEW YORK (AP) -- Annie's stock dropped Tuesday as the natural and organic food maker said that it now foresees its fiscal 2014 adjusted earnings coming in at the lower end of its forecast.

THE SPARK: Annie's Inc. now expects fiscal 2014 adjusted earnings at the lower end of its range of 97 cents to $1.01 per share. The company also revised its revenue guidance, saying it now anticipates revenue at the upper end of its estimate for 18 percent to 20 percent growth.

Annie's said that its updated outlooks take into account current business trends and year-to-date financial results.

Analysts surveyed by FactSet expect 2014 earnings of 98 cents per share and revenue of $204.4 million, which represents growth of 20 percent from last year's $170 million.

The company also announced that Chief Financial Officer and Treasurer Kelly Kennedy is resigning to spend more time with her family. The resignation is effective on Nov. 12. Kennedy is expected to stay at Annie's through fiscal 2014 to lead special projects and help with the transition process.

The company named Zahir Ibrahim as CFO, treasurer and executive vice president, effective Nov. 13. He most recently served as vice president corporate controller and chief accounting officer at Molson Coors Brewing Co.

THE ANALYSIS: Christopher Growe of Stifel Nicolaus said in a client note that the revised earnings forecast was surprising partly because of Annie's strong revenue growth and visibility into its cost structure. The analyst said that there's limited financial details related to the outlook since the company is in a quiet period before it reports its second-quarter financial results on Nov. 7.

Growe maintained a "Hold" rating.

SHARE ACTION: Down $3.53, or 6.8 percent, to $48.31 in afternoon trading. The stock is up 45 percent for the year to date.

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