08:49 AM EDT, 09/04/2024 (MT Newswires) -- Hormel Foods ( HRL ) on Wednesday narrowed its earnings outlook and lowered its sales guidance for fiscal 2024, as the food maker's third-quarter results declined year over year.

The company now expects adjusted earnings in a range of $1.57 and $1.63 per share for fiscal 2024, compared with its previous projections of $1.55 to $1.65. The consensus on Capital IQ is for normalized EPS of $1.59. Production disruptions at a facility in Virginia are estimated to impact the bottom line by $0.06 a share.

Hormel's shares declined 6.8% in premarket activity.

Sales are pegged at $11.8 billion to $12.1 billion for the ongoing fiscal year versus the prior forecast of $12.2 billion to $12.5 billion, due to lower-than-expected commodity markets, production disruptions at the Virginia facility and declines in the contract manufacturing business, according to Hormel. The Street is looking for revenue of $12.13 billion.

"Our team remains focused on finishing the year strong and executing on our strategic priorities," Chief Executive Jim Snee said in a statement. "In the fourth quarter, we expect continued momentum across many of our key retail brands, growth within our foodservice and international businesses."

For the quarter ended July 28, adjusted EPS decreased to $0.37 from $0.40 the year before, but topped the Street's view for $0.36. Sales fell 2.2% year over year to nearly $2.9 billion, trailing analysts' $2.96 billion estimate. Total volume dropped 6.9%.

Revenue for retail products fell 6.6% year over year to $1.77 billion, mainly due to reduced volume and prices for whole-bird turkeys and lower sales in the Planters snack nuts business, among other factors, the company said. Foodservice revenue gained 7.1% to $954 million buoyed by the turkey, bacon, premium prepared proteins and pepperoni categories. International sales slipped to $177.2 million from $180.6 million in the prior-year quarter.

The foodservice business "continued to deliver above-industry growth," while the company saw "significant recovery" in its International segment, according to Snee. "We continued to realize growing benefits from our transform and modernize initiative, creating impactful improvements across our supply chain," the CEO said.

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