OMAHA - Improved efficiency and marketing coupled with a rebounding economy helped ConAgra Foods boost its third-quarter net income by 48 percent despite a 2 percent decline in sales.<br>
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The food maker behind brands like Healthy Choice, Banquet, Butterball turkeys and Orville Redenbacher popcorn earned $171 million, or 31 cents a share, in the quarter ended Feb. 24 compared with $116 million, or 22 cents a share, in the same period last year.<br>
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Earnings per share beat Wall Street expectations by a penny, according to a survey of analysts by Thomson Financial/First Call.<br>
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Sales slipped to $6.24 billion from $6.38 billion a year ago. Operating profits grew 30 percent to $463 million, ConAgra said.<br>
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Sales in packaged foods rose 3 percent to $3 billion, but edged down 4 percent to $412 million in grain processing, seasonings and flavorings products and fell 9 percent to $2.3 billion in meatpacking operations.<br>
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Fertilizer, seed, pesticide and herbicide sales were up 7 percent to $524 million, but that segment posted a $38 million operating loss because of low product margins and bad debts in a weak market, the company said.<br>
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Sales declines in processing came in part from the closing of a flour mill and a fire at a meatpacking plant, ConAgra said.<br>
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For the first nine months of the fiscal year, ConAgra earned $590.8 million, or $1.11 a share, up from $517.2 million, or $1.10 a share, a year ago.<br>
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Revenue rose to $21.2 billion in the nine-month period from $20.7 billion a year ago.<br>
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"We believe we will post strong earnings for the balance of the fiscal year," ConAgra chairman and chief executive Bruce Rohde said. "Compared to a year ago, our resources are aligned for better execution, and we are facing a more favorable business environment."<br>
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Rohde said he expected ConAgra to modestly exceed consensus estimates for the year of $1.42 per share.<br>
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The nation's second largest food company behind Philip Morris Co.'s Kraft Foods, ConAgra underwent a major restructuring three years ago designed to improve efficiency and marketing while emphasizing its role as a retail foods company.<br>
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ConAgra's stock was up 33 cents to $24.28 in morning trading on the New York Stock Exchange. <br>
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