Conagra Brands expects weak annual profit on rising costs

April 1 (Reuters) - Conagra Brands CAG.N forecast annual profit at the low end of its guidance range on Wednesday, citing elevated costs in a volatile macroeconomic environment.

Rising costs linked to the Iran war are intensifying macroeconomic pressures, driving up expenses for food companies already navigating higher input costs and changing dietary preferences.

Shares of the Hunt's ketchup maker were down 2% in premarket trading.

Conagra had previously planned price raises to offset higher costs of ingredients such as cocoa, olive oil, and palm oil, and tariffs on tin-plate steel.

Prices rose 1.9% for the three months ended February 22.

It now expects annual adjusted profit per share of $1.70, at the low end of its prior forecast of between $1.70 and $1.85.

The company continues to expect costs to remain high in fiscal 2026, with inflation of about 7%, including tariffs, before accounting for mitigation actions.

It expects annual net sales at the midpoint of its previous forecast of a 1% decline to a 1% rise.

Peer General Mills GIS.N reaffirmed its annual targets, while Campbell CPB.O cut its annual sales and profit forecasts recently.

"This is not an easy operating environment," CEO Sean Connolly said in a statement.

The company posted a quarterly revenue decline of 1.9% to $2.79 billion, but narrowly beat analysts' expectations of $2.76 billion, according to data compiled by LSEG

It reported quarterly adjusted earnings of 39 cents per share, compared with expectations of 40 cents.