11:06 AM EDT, 07/11/2024 (MT Newswires) -- Conagra Brands' ( CAG ) fiscal fourth-quarter revenue declined more than expected while adjusted earnings didn't fall as much as projected as the packaged food maker said that challenging market dynamics will likely begin to abate in 2025.

Revenue declined to $2.91 billion for the three months ended May 26 from $2.97 billion a year ago and missed the average analyst estimate of $2.93 billion on Capital IQ. Shares of Conagra Brands ( CAG ) were down 3.8% in Thursday trade.

The parent of brands such as Slim Jim, Hunt's and Reddi Wip said adjusted earnings per share dipped by a penny year over year to $0.61, remaining above the consensus forecast of $0.57.

By segment, grocery and snack revenue slid 2.1% to $1.2 billion due to lower consumption trends. Sales in its refrigerated and frozen division fell 3.8% to $1.2 billion, driven by a lower price and mix that was partially offset by higher volumes. In its two smaller businesses, international sales climbed by 6.4% while foodservice declined 3.9%.

"Our investments in our brands continued to yield results, and again drove volume improvement in our domestic retail business," Chief Executive Sean Connolly said in a statement. "Additionally, our supply chain productivity initiatives enabled us to expand adjusted gross margins, and we continued to strengthen the balance sheet and reduce our net leverage ratio."

Looking ahead, Connolly forecasts a "gradual waning of the challenging industry trends" that impacted fiscal 2024, "as consumers adapt and establish new reference prices," he said.

Conagra Brands ( CAG ) expects organic net sales to be down 1.5% to flat year over year in fiscal 2025, an improvement from fiscal 2024 when organic sales dropped 2.1%. It is targeting adjusted EPS in the range of $2.60 to $2.65, signaling a further decline after the company's adjusted EPS decreased 3.6% to $2.67 for the year ended in May.

Wall Street was most recently modeling for revenue of $12.18 billion and normalized EPS of $2.69 for the ongoing year.

Price: 27.76, Change: -1.06, Percent Change: -3.66