Chef Boyardee, the canned Italian food that many adults remember from childhood, got a premium remake with higher-quality ingredients and a higher price tag to match.
The old-school brand was a highlight of parent company Conagra Brands Inc.’s
early Thursday fiscal first-quarter earnings report. The company reported an earnings miss and gave downbeat guidance, but said Chef Boyardee “throwback recipes” went down well.
These recipes are made with ingredients like Romano cheese, Angus beef and tomatoes from California, which Conagra Chief Executive Sean Connolly said is “reminiscent of those dishes Chef Hector Boyardee actually cooked up back in the day.”
Among the premium choices are Beefaroni, canned pasta in tomato and meat sauce, and beef ravioli. The premium options are priced 50% higher, according to information Conagra provided with its earnings release. A 15-ounce can costs $1.48 in South Carolina, for instance, according to numbers available on the Chef Boyardee website.
See:Your kid’s Happy Meal likely isn’t a healthy meal
Chef Boyardee generated more than $450 million in revenue for the quarter, Conagra said.
“This is a premium product at a premium price and it’s margin accretive to the base Chef Boyardee offering,” Connolly said, according to a FactSet transcript.
Connolly referred to Chef Boyardee as a “reliable contributor.”
“These are not brands that we expect to deliver outsized growth,” he said. “But they are also not brands that we ignore or allow to atrophy. We surgically invest in these brands to ensure they will continue to generate stable consistent cash flow to help drive growth.”
The throwback recipes were coupled with a song, “Start the Par-dee,” and music video featuring rapper Lil Yachty and Donny Osmond, another mix of new and throwback. The video, released August 17, has more than 205,000 views on YouTube. Conagra said it reached number three on Spotify Technology S.A.’s
most viral playlist.
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Conagra highlighted sales in the refrigerated and frozen segment, up 3.2% to $635 million for the quarter. Some of the new items in this category for fiscal 2019 include a spicy Buffalo-style chicken macaroni-and-cheese bowl from the Marie Callender’s brand and Healthy Choice Power Bowls, which come in flavors like roasted red pepper and egg white shakshuka, and turkey sausage and egg white scramble.
And Connolly said there’s opportunity to grow the company’s $2 billion snacks and sweets business. Among the snack products are Slim Jim jerky, Orville Redenbacher’s popcorn, and David’s sunflower seeds.
Conagra shares closed Thursday down 8.5% and are down 9.8% for the year so far while the S&P 500 index
has gained 9% for the period.
View more information: https://www.marketwatch.com/story/chef-boyardee-charges-50-more-for-premium-beefaroni-goes-viral-on-spotify-2018-09-27