Higher prices for pet food helped food giant Del Monte Foods to reach a higher -than-expected quarterly profit. The company also raised its full-year forecast which boosted the shares up 13%.
Despite the tough economy, consumers also are still spending on their pets, buying "indulgent" treats like Pup-Peroni dog snacks, chief executive Richard Wolford said during a conference call with analysts after the company reported results.
Pet food sales rose 15.1%, helped by new Meow Mix products and price increases, though the price increases did push shipment volume down slightly.
The basic pet food sector is one where Del Monte is more likely to be able to hold onto its price increases. Consumers are likely skittish about trading down to private label competitors because of concerns about product contamination, Morningstar analyst Ann Gilpin said.
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