8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

March 24, 2011
Date of report (Date of earliest event reported)

ConAgra Foods, Inc.

(Exact Name of Registrant as Specified in its Charter)

Delaware
(State or Other Jurisdiction of Incorporation)

1-7275	47-0248710
(Commission File Number)	(IRS Employer Identification No.)
One ConAgra Drive Omaha, NE (Address of Principal Executive Offices)	68102 (Zip Code)

(402) 240-4000
(Registrant’s Telephone Number, Including Area Code)

(Former Name or Former Address, if Changed Since Last Report)

     Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition

     On March 24, 2011, ConAgra Foods, Inc. (the “Company”) issued a press release and posted a question and answer document (“Q&A”) on its website containing information on the Company’s third quarter fiscal 2011 financial results. The press release and Q&A are furnished with this Form 8-K as exhibits 99.1 and 99.2, respectively.

     The press release and Q&A include the non-GAAP financial measures of adjusted operating profit for the Consumer Foods segment, adjusted operating profit for the Commercial Foods segment, adjusted unallocated corporate expense, adjusted diluted earnings per share, adjusted diluted earnings per share from continuing operations and net debt. Management considers GAAP financial measures as well as such non-GAAP financial information in its evaluation of the Company’s financial statements and believes these non-GAAP measures provide useful supplemental information to assess the Company’s operating performance and financial position. These measures are reconciled in the press release and Q&A to the most directly comparable measures as reported in accordance with GAAP, and should be viewed in addition to, and not in lieu of, the Company’s diluted earnings per share and operating performance and financial measures as calculated in accordance with GAAP.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

Exhibit 99.1 Press Release issued March 24, 2011

Exhibit 99.2 Questions and Answers

This report, including Exhibits 99.1 and 99.2 furnished hereunder, contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current views and assumptions of future events and financial performance and are subject to uncertainty and changes in circumstances. Readers of this report should understand that these statements are not guarantees of performance or results. Many factors could affect our actual financial results and cause them to vary materially from the expectations contained in the forward-looking statements, including those set forth in this report. These factors include, among other things: availability and prices of raw materials; the impact of the accident at the Garner, N.C., manufacturing facility, including the ultimate costs incurred and the amounts received under insurance policies; the effectiveness of our product pricing; future economic circumstances; industry conditions; our ability to execute our operating and network optimization plans; the success of our innovation, marketing, and cost-saving initiatives; the amount and timing of repurchases of our common stock, if any; the competitive environment and related market conditions; operating efficiencies; the ultimate impact of our product recalls; access to capital; actions of governments and regulatory factors affecting our businesses, including the Patient Protection and Affordable Care Act; and other risks described in our reports filed with the Securities and Exchange Commission. We caution readers not to place undue reliance on any forward-looking statements included in this report which speak only as of the date of this report.

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	CONAGRA FOODS, INC.
Date: March 24, 2011	By:	/s/ Colleen Batcheler
		Name:	Colleen Batcheler
		Title:	Executive Vice President, General Counsel and Corporate Secretary

Exhibit Index

Exhibit 99.1 Press release issued March 24, 2011

Exhibit 99.2 Questions and Answers

EX-99.1

Exhibit 99.1

News Release

For more information, contact:

Teresa Paulsen       MEDIA

Vice President, Corporate Communication

ConAgra Foods, Inc.

tel: 402-240-5210

Chris Klinefelter ANALYSTS

Vice President, Investor Relations

ConAgra Foods, Inc.

tel: 402-240-4154

www.conagrafoods.com

FOR IMMEDIATE RELEASE

CONAGRA FOODS REPORTS FISCAL 2011 THIRD-QUARTER EPS GROWTH;
CONFIRMS FISCAL-YEAR GUIDANCE

Highlights (vs. year-ago amounts):

• Diluted EPS from continuing operations of $0.50 as reported and adjusted for items impacting comparability; up 2% as reported and up 16% on a comparable basis.

• Consumer Foods and Commercial Foods comparable operating profits increased over year-ago amounts, improving on the results seen earlier this fiscal year.

• Lower incentive compensation expense and recent share repurchases contributed to the quarter’s EPS results.

• Fiscal 2011 diluted EPS adjusted for items impacting comparability expected to grow at a low-single-digit rate over comparable fiscal 2010 EPS (fiscal 2010 EPS: $1.67 as reported, $1.74 comparable base).

OMAHA, Neb., March 24, 2011 — ConAgra Foods, Inc., (NYSE: CAG) one of North America’s leading packaged food companies, today reported results for the fiscal 2011 third quarter ended Feb. 27, 2011. As reported, diluted EPS from continuing operations was $0.50, a 2% increase over the $0.49 earned in the year-ago period. Diluted EPS from continuing operations increased 16% after adjusting for $0.06 per diluted share of net benefit in the year-ago period from items impacting comparability. Items impacting comparability, including those relating to business segment performance, for the current fiscal year (no net EPS impact) and prior fiscal year are summarized toward the end of this release and reconciled for Regulation G purposes on pages 9 and 10.

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CONAGRA FOODS
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Gary Rodkin, ConAgra Foods’ chief executive officer, said, “We are pleased that fiscal third-quarter results demonstrate comparable EPS and segment operating profit growth, despite high input cost inflation and other challenging economic conditions. Sequential price/mix trends in our Consumer Foods segment are directionally improving as we expected. While inflationary pressures continue to build and difficult conditions persist, we expect our performance to continue to benefit from pricing actions under way, strong supply chain cost savings, and other profit-enhancing initiatives we have previously detailed. We are confident in our ability to post a low-single-digit rate of EPS growth over the comparable $1.74 earned last fiscal year.”

Consumer Foods Segment (66% of third-quarter sales)

Branded and non-branded food sold in retail and foodservice channels.

The Consumer Foods segment posted sales of $2,085 million and operating profit of $263 million for the third quarter. Sales increased 2% as reported, reflecting flat organic volume and price/mix compared with a year ago, and approximately 2% benefit from acquisitions (net of divestitures).

• Brands posting sales growth for the quarter included Banquet, DAVID, Healthy Choice, Hebrew National, Manwich, Marie Callender’s, Peter Pan, Slim Jim, Wesson, and others.

• More brand details can be found in the Q&A document accompanying this release.

• Based on accelerating input cost inflation, the company has been implementing net pricing increases, which will be more apparent in future sales results.

Operating profit of $263 million was below $306 million in the year-ago period, as reported. After adjusting for $39 million of restructuring and asset impairment costs in the current period, as well as $14 million of gain from divesting the Luck’s brand in the year-ago period, comparable current-quarter operating profit increased 3%. The profit performance reflects strong supply chain savings, lower advertising and promotion expense, and lower incentive compensation expense, which collectively offset significant inflation. The company is on track to deliver in excess of $275 million of cost savings in the Consumer Foods segment this fiscal year.

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CONAGRA FOODS
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Commercial Foods Segment (34% of third-quarter sales)

Specialty potato, milled grain products, and seasonings, blends, and flavors sold to foodservice and
commercial channels worldwide.

Sales for the Commercial Foods segment were $1,070 million, 7% above year-ago amounts. The sales increase reflects higher selling prices for the flour milling operations necessitated by higher wheat input costs, as well as volume growth for Lamb Weston specialty potato products.

Segment operating profit was $139 million, slightly below $143 million in the year-ago period as reported. After adjusting for $10 million of restructuring charges in the current quarter, comparable segment operating profit increased 5%. Lamb Weston benefited from improved potato crop quality, and has pricing and efficiency initiatives under way to address overall margin pressure. Flour milling profits increased from year-ago amounts due to favorable market conditions and effective margin management in a very volatile wheat market.

Hedging Activities — This language primarily relates to operations other than the company’s milling operations.

The company recorded $24 million of net hedging benefit within unallocated Corporate expense in the current quarter, and an immaterial amount in the year-ago period. The company identifies the $24 million gain as an item impacting comparability. The net hedging amounts are reclassified from unallocated Corporate expense to the operating segments when the underlying commodity or foreign currency being economically hedged is expensed in segment cost of goods sold.

Capital and Other Items

• Corporate expense was $26 million for the quarter and $88 million in the year-ago period. Current-quarter amounts include $24 million of net hedging benefit, and a $25 million gain related to the early repayment of payment-in-kind notes receivable by a debtor. Prior-year amounts include $15 million of benefit related to favorable adjustments in environmental liabilities. Excluding these amounts, Corporate expense was $75 million for the current quarter

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CONAGRA FOODS
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and $103 million in the year-ago period; the decrease largely reflects lower incentive compensation expense and other benefits from ongoing cost reduction efforts.

•

Net interest expense was $52 million in the current quarter, compared with $40 million in the year-ago period. The increase is due primarily to the fact that a debtor has repaid in full the payment-in-kind notes receivable related to the divestiture of the Trading & Merchandising operations, and thus the company is no longer receiving interest income on those notes. Prior-year amounts included $21 million of income from those notes. As previously communicated, the company’s share repurchase authorization was increased by the amount of the proceeds from the repayment of the notes. The EPS benefit of the share repurchases is expected to substantially offset the EPS impact of the foregone interest income by the start of fiscal 2012.

• The company repurchased $490 million, or 21.4 million shares, of its common stock during the quarter and plans to repurchase in the range of $135 million more before fiscal year-end, subject to market conditions. Repurchases may be completed through negotiated transactions or open market purchases.

• Equity method investment earnings were $7 million in the current quarter and $3 million in the year-ago period.

• The effective tax rate for continuing operations for the quarter was approximately 35%. The company continues to expect the continuing operations effective tax rate for the full fiscal year 2011 to be approximately 34%, adjusted for items impacting comparability.

• For the quarter, capital expenditures from continuing operations for property, plant, and equipment were $136 million, compared with $120 million in the year-ago period. Depreciation and amortization expense from continuing operations was approximately $91 million for the quarter; this compares with a total of $82 million in the year-ago period.

• Dividends for the quarter totaled $100 million versus $89 million for the year-ago period, reflecting an increase in the dividend rate earlier this fiscal year and fewer shares outstanding.

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CONAGRA FOODS
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• Subsequent to quarter end, the company reached a settlement in principle with its insurance carriers related to the Garner, NC event in 2009. Related to this, the company will record a gain of approximately $105 million in the fourth quarter, which will be classified as an item impacting comparability.

Outlook

The company continues to expect fiscal 2011 full-year diluted EPS, adjusted for items impacting comparability, to show a low-single-digit rate of growth over the comparable $1.74 earned in fiscal 2010. This improvement primarily reflects the benefits of pricing actions, strong supply chain savings, improved potato crop quality, lower incentive compensation costs, share repurchases, and contributions from innovation and recently acquired businesses.

Regarding quarterly details:

• Fiscal 2011 third-quarter EPS was higher than planned.

• The company’s expectations for fiscal 2011 second-half earnings in aggregate are unchanged.

• The company now expects fiscal fourth-quarter comparable EPS amounts to be lower than comparable fiscal third-quarter EPS amounts, primarily due to accelerating inflation and higher-than-planned third quarter flour milling profits. The company expects fiscal 2011 fourth quarter EPS to show strong comparable year-over-year growth.

The company notes that fiscal 2012 projections have not yet been finalized; consistent with past practice, the company plans to provide fiscal 2012 guidance in its fiscal fourth-quarter release.

Major Items Impacting Third-quarter Fiscal 2011 EPS Comparability

Included in the $0.50 diluted EPS from continuing operations for the third quarter of fiscal 2011 (EPS amounts rounded and after tax):

• Approximately $0.07 per diluted share of net expense, or $49 million pretax, reflecting restructuring charges as well as asset impairment charges relating to a small business.

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CONAGRA FOODS
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• Restructuring charges of $33 million, or $0.05 per diluted share, classified as $23 million within Consumer Foods ($6 million COGS, $17 million SG&A) and $10 million within the Commercial Foods segment (SG&A).

• Asset impairment charges of $16 million, or $0.02 per diluted share, classified within Consumer Foods SG&A.

• Approximately $0.04 per diluted share of net benefit, or $25 million pretax, resulting from the receipt of $554 million in cash as early repayment in full for notes receivable related to the 2008 divestiture of the Trading and Merchandising operations. This is classified within unallocated Corporate expense.

• Approximately $0.03 per diluted share of net benefit, or $24 million pretax, related to the mark-to-market impact of derivatives used to hedge input costs, temporarily classified in unallocated Corporate expense. This will later be reclassified to the operating segments when underlying hedged items are expensed in cost of goods sold.

Included in the $0.49 diluted EPS from continuing operations for the third quarter of fiscal 2010 (EPS amounts rounded and after tax):

• Approximately $0.02 per diluted share gain resulting from the sale of the Luck’s brand. This $14 million pretax gain is classified within the Selling, General, and Administrative expenses of the Consumer Foods segment.

• Approximately $0.02 per diluted share of net benefit, or a $15 million reduction in pretax expense, associated with favorable adjustments to environmental liabilities. This is classified within unallocated Corporate expense.

• Approximately $0.02 per diluted share of net income tax benefits resulting in a lower-than-planned effective income tax rate.

• NOTE: When reporting third-quarter diluted EPS from continuing operations in fiscal 2010, there was $0.01 of EPS related to the Gilroy Foods & Flavors dehydrated vegetable operations within continuing operations. This business was subsequently divested, and the $0.01 of EPS is now included in discontinued operations. As a result of this reclassification, fiscal 2010 third-quarter diluted EPS from continuing operations, excluding items impacting comparability, now rounds to $0.43 instead of the $0.44 presented in the prior year.

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CONAGRA FOODS
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Discussion of Results

ConAgra Foods will host a conference call at 9:30 a.m. EDT today to discuss the results. Following the company’s remarks, the call will include a question-and-answer session with the investment community. Domestic and international participants may access the conference call toll-free by dialing 1-877-718-5104 and 1-719-325-4747, respectively. No confirmation or pass code is needed. This conference call also can be accessed live on the Internet at http://investor.conagrafoods.com.

A rebroadcast of the conference call will be available after 1 p.m. EDT today. To access the digital replay, a pass code number will be required. Domestic participants should dial 1-888-203-1112, and international participants should dial 1-719-457-0820 and enter pass code 4725396. A rebroadcast also will be available on the company’s website.

In addition, the company has posted a question-and-answer supplement relating to this release at http://investor.conagrafoods.com. To view recent company news, please visit http://media.conagrafoods.com.

ConAgra Foods, Inc., (NYSE: CAG) is one of North America’s leading food companies, with brands in 97 percent of America’s households. Consumers find Banquet, Chef Boyardee, Egg Beaters, Healthy Choice, Hebrew National, Hunt’s, Marie Callender’s, Orville Redenbacher’s, PAM, Peter Pan, Reddi-wip, Slim Jim, Snack Pack and many other ConAgra Foods brands in grocery, convenience, mass merchandise and club stores. ConAgra Foods also has a strong business-to-business presence, supplying frozen potato and sweet potato products as well as other vegetable, spice and grain products to a variety of well-known restaurants, foodservice operators and commercial customers. For more information, please visit us at www.conagrafoods.com.

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CONAGRA FOODS
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Note on Forward-looking Statements

This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current views and assumptions of future events and financial performance and are subject to uncertainty and changes in circumstances. The company undertakes no responsibility for updating these statements. Readers of this release should understand that these statements are not guarantees of performance or results. Many factors could affect the company’s actual financial results and cause them to vary materially from the expectations contained in the forward-looking statements. These factors include, among other things: availability and prices of raw materials; the impact of the 2009 accident at the Garner, N.C., manufacturing facility, including the ultimate costs incurred and the amounts received under insurance policies; the effectiveness of its product pricing; future economic circumstances; industry conditions; the company’s ability to execute its operating and network optimization plans; the success of the company’s innovation, marketing, and cost-saving initiatives; the amount and timing of repurchases of the company’s common stock, if any; the competitive environment and related market conditions; operating efficiencies; the ultimate impact of the company’s product recalls; access to capital; actions of governments and regulatory factors affecting the company’s businesses, including the Patient Protection and Affordable Care Act; and other risks described in the company’s reports filed with the Securities and Exchange Commission. The company cautions readers not to place undue reliance on any forward-looking statements included in this release, which speak only as of the date of this release.

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CONAGRA FOODS
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Regulation G Disclosure

Below is a reconciliation of diluted earnings per share adjusted for items impacting comparability.

Q3 FY11 & Q3 FY10 Diluted EPS from Continuing Operations — Reconciliation for Regulation G Purposes

							Percent
	Q3 FY11			Q3 FY10			Change
Diluted EPS from continuing operations	$	0.50		$	0.49			2	%
Items impacting comparability:
Expense related to restructuring charges		0.05			—
Expense related to asset impairment charges		0.02			—
(Benefit) related to unallocated mark-to-market impact of derivatives		(0.03	)		—
(Benefit) of gain on early repayment of Trading & Merchandising divestiture-related PIK note		(0.04	)
(Benefit) expense related to environmental liability estimates		—			(0.02	)
(Benefit) related to gain on sale of Luck’s brand		—			(0.02	)
(Benefit) of lower-than-planned effective income tax rate		—			(0.02	)
Diluted EPS from continuing operations, excluding items impacting comparability	$	0.50		$	0.43			16	%
Diluted EPS from Gilroy Foods & Flavors operations, reclassified to discontinued operations in Q4 FY10, but part of the company’s FY10 EPS guidance		—			0.01
Diluted EPS adjusted for items impacting comparability	$	0.50		$	0.44			14	%

Consumer Foods Segment

Below is a reconciliation of segment operating profit exclusive of items impacting comparability.

Consumer Foods Segment Operating Profit Reconciliation

	(Dollars in millions)					Percent
	Q3 FY11		Q3 FY10			Change
Consumer Foods Segment Operating Profit	$	263	$	306			—14	%
Expense related to restructuring charges		23		—
Expense related to asset impairment charges		16		—
(Benefit) related to gain on sale of Luck’s brand		—		(14	)
Consumer Foods Segment Adjusted Operating Profit	$	302	$	292			3	%

Commercial Foods Segment

Below is a reconciliation of segment operating profit exclusive of items impacting comparability.

Commercial Foods Segment Operating Profit Reconciliation

	(Dollars in millions)					Percent
	Q3 FY11			Q3 FY10		Change
Commercial Foods Segment Operating Profit	$	139		$	143		—3	%
Expense related to restructuring charges		10			—
Commercial Foods Segment Adjusted Operating Profit	$	150	*	$	143		5	%

* Numbers do not add due to rounding

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CONAGRA FOODS
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FY10 EPS — Reconciliation for Regulation G Purposes

	Total
	FY10
Diluted EPS from continuing operations	$	1.67
Items impacting comparability:
Expense related to unallocated mark-to-market impact of derivatives (Q1)		0.01
(Benefit) related to unallocated mark-to-market impact of derivatives (Q2)		(0.01	)
(Benefit) related to gain on sale of Luck’s brand (Q3)		(0.02	)
(Benefit) related to environmental liability estimates (Q3)		(0.02	)
(Benefit) of lower-than-planned effective income tax rate (Q2, Q3, Q4)		(0.05	)
Diluted EPS from Gilroy Foods & Flavors operations, reclassified to discontinued
operations in Q4 FY10, but part of the company’s FY10 EPS guidance (Q4)		0.04
Expense related to Garner, N.C., and Edina, Minn., restructuring charges (Q3, Q4)		0.06
Expense related to impairment charge on an existing facility (Q4)		0.05
Expense related to tax credit transaction related to Delhi, La., sweet potato facility (Q4)		0.02
Rounding included in above items		(0.01	)
Diluted EPS adjusted for items impacting comparability	$	1.74

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CONAGRA FOODS
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ConAgra Foods, Inc.
Segment Operating Results
(in millions)
(unaudited)

	THIRD QUARTER
	13 Weeks Ended			13 Weeks Ended
	February 27, 2011			February 28, 2010			Percent Change
SALES
Consumer Foods	$	2,084.9		$	2,034.4			2.5	%
Commercial Foods		1,069.8			996.1			7.4	%
Total		3,154.7			3,030.5			4.1	%
OPERATING PROFIT
Consumer Foods	$	263.3		$	306.3			(14.0	)%
Commercial Foods		139.4			142.5			(2.2	)%
Total operating profit for segments		402.7			448.8			(10.3	)%
Reconciliation of total operating profit to income from continuing operations before income taxes and equity method investment earnings
Items excluded from segment operating profit:
General corporate expense		(25.6	)		(88.4	)		(71.0	)%
Interest expense, net		(51.6	)		(39.7	)		30.0	%
Income from continuing operations before income taxes and equity method investment earnings	$	325.5		$	320.7			1.5	%

Segment operating profit excludes general corporate expense, equity method investment earnings, and net interest expense. Management believes such amounts are not directly associated with segment performance results for the period. Management believes the presentation of total operating profit for segments facilitates period-to-period comparison of results of segment operations.

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ConAgra Foods, Inc.
Segment Operating Results
(in millions)
(unaudited)

	THIRD QUARTER
	39 Weeks Ended			39 Weeks Ended
	February 27, 2011			February 28, 2010			Percent Change
SALES
Consumer Foods	$	6,013.3		$	5,972.6			0.7	%
Commercial Foods		3,120.1			3,044.3			2.5	%
Total		9,133.4			9,016.9			1.3	%
OPERATING PROFIT
Consumer Foods	$	761.2		$	886.2			(14.1	)%
Commercial Foods		377.5			427.6			(11.7	)%
Total operating profit for segments		1,138.7			1,313.8			(13.3	)%
Reconciliation of total operating profit to income from continuing operations before income taxes and equity method investment earnings
Items excluded from segment operating profit:
General corporate expense		(188.1	)		(282.6	)		(33.4	)%
Interest expense, net		(122.6	)		(121.6	)		0.8	%
Income from continuing operations before income taxes and equity method investment earnings	$	828.0		$	909.6			(9.0	)%

Segment operating profit excludes general corporate expense, equity method investment earnings, and net interest expense. Management believes such amounts are not directly associated with segment performance results for the period. Management believes the presentation of total operating profit for segments facilitates period-to-period comparison of results of segment operations.

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ConAgra Foods, Inc.
Consolidated Statements of Earnings
(in millions, except per share amounts)
(unaudited)

	THIRD QUARTER
	13 Weeks Ended		13 Weeks Ended			Percent
	February 27, 2011		February 28, 2010			Change
Net sales	$	3,154.7	$	3,030.5			4.1	%
Costs and expenses:
Cost of goods sold		2,357.1		2,251.9			4.7	%
Selling, general and administrative expenses		420.5		418.2			0.5	%
Interest expense, net		51.6		39.7			30.0	%
Income from continuing operations before income taxes and equity method investment earnings		325.5		320.7			1.5	%
Income tax expense		117.0		102.6			14.0	%
Equity method investment earnings		6.6		2.9			127.6	%
Income from continuing operations		215.1		221.0			(2.7	)%
Income from discontinued operations, net of tax		—		7.7			(100.0	)%
Net income	$	215.1	$	228.7			(5.9	)%
Less: Net income (loss) attributable to noncontrolling interests		0.3		(0.9	)		N/A
Net income attributable to ConAgra Foods, Inc.	$	214.8	$	229.6			(6.4	)%
Earnings per share — basic
Income from continuing operations	$	0.50	$	0.50			—
Income from discontinued operations		—		0.02			(100.0	)%
Net income	$	0.50	$	0.52			(3.8	)%
Weighted average shares outstanding		428.4		444.0			(3.5	)%
Earnings per share — diluted
Income from continuing operations	$	0.50	$	0.49			2.0	%
Income from discontinued operations		—		0.02			(100.0	)%
Net income	$	0.50	$	0.51			(2.0	)%
Weighted average share and share equivalents outstanding		432.8		448.3			(3.5	)%

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ConAgra Foods, Inc.
Consolidated Statements of Earnings
(in millions, except per share amounts)
(unaudited)

	THIRD QUARTER
	39 Weeks Ended		39 Weeks Ended			Percent
	February 27, 2011		February 28, 2010			Change
Net sales	$	9,133.4	$	9,016.9			1.3	%
Costs and expenses:
Cost of goods sold		6,923.9		6,689.5			3.5	%
Selling, general and administrative expenses		1,258.9		1,296.2			(2.9	)%
Interest expense, net		122.6		121.6			0.8	%
Income from continuing operations before income taxes and equity method investment earnings		828.0		909.6			(9.0	)%
Income tax expense		285.4		305.5			(6.6	)%
Equity method investment earnings		17.4		17.7			(1.7	)%
Income from continuing operations		560.0		621.8			(9.9	)%
Income from discontinued operations, net of tax		3.2		11.3			(71.7	)%
Net income	$	563.2	$	633.1			(11.0	)%
Less: Net income (loss) attributable to noncontrolling interests		1.1		(2.1	)		N/A
Net income attributable to ConAgra Foods, Inc.	$	562.1	$	635.2			(11.5	)%
Earnings per share — basic
Income from continuing operations	$	1.28	$	1.40			(8.6	)%
Income from discontinued operations		0.01		0.03			(66.7	)%
Net income	$	1.29	$	1.43			(9.8	)%
Weighted average shares outstanding		435.5		443.5			(1.8	)%
Earnings per share — diluted
Income from continuing operations	$	1.27	$	1.39			(8.6	)%
Income from discontinued operations		—		0.03			(100.0	)%
Net income	$	1.27	$	1.42			(10.6	)%
Weighted average share and share equivalents outstanding		439.7		446.4			(1.5	)%

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CONAGRA FOODS
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ConAgra Foods, Inc.
Consolidated Balance Sheets
(in millions)
(unaudited)

	February 27, 2011		May 30, 2010
ASSETS
Current assets
Cash and cash equivalents	$	882.9	$	953.2
Receivables, less allowance for doubtful accounts of $8.0 and $8.5		876.7		849.6
Inventories		1,932.7		1,606.5
Prepaid expenses and other current assets		343.2		307.3
Current assets held for sale		—		243.5
Total current assets		4,035.5		3,960.1
Property, plant and equipment, net		2,637.6		2,625.0
Goodwill		3,611.1		3,552.1
Brands, trademarks and other intangibles, net		941.1		874.8
Other assets		247.5		695.6
Noncurrent assets held for sale		—		30.4
	$	11,472.8	$	11,738.0
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Notes payable	$	—	$	0.6
Current installments of long-term debt		359.4		260.2
Accounts payable		1,031.3		919.1
Accrued payroll		147.9		263.9
Other accrued liabilities		764.8		579.0
Current liabilities held for sale		—		13.4
Total current liabilities		2,303.4		2,036.2
Senior long-term debt, excluding current installments		2,679.2		3,030.5
Subordinated debt		195.9		195.9
Other noncurrent liabilities		1,670.1		1,541.3
Noncurrent liabilities held for sale		—		5.2
Total stockholders’ equity		4,624.2		4,928.9
	$	11,472.8	$	11,738.0

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CONAGRA FOODS
page 16

ConAgra Foods, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(in millions)
(unaudited)

	Thirty-nine weeks ended
	February 27,			February 28,
	2011			2010
Cash flows from operating activities:
Net income	$	563.2		$	633.1
Income from discontinued operations		3.2			11.3
Income from continuing operations		560.0			621.8
Adjustments to reconcile income from continuing operations to net cash flows from operating activities:
Depreciation and amortization		266.3			241.0
Impairment charges related to Garner accident		—			19.6
Insurance recoveries recognized related to Garner accident		(2.1	)		(45.0	)
Advances from insurance carriers related to Garner accident		16.9			37.7
Proceeds from settlement of interest rate swaps		31.5			—
Loss on sale of fixed assets		7.5			2.8
Asset impairment charges		35.4			8.4
Gain on sale of business		—			(14.3	)
Distributions from affiliates greater (less) than current earnings		(6.8	)		8.7
Contributions to Company pension plans		(115.7	)		(19.7	)
Share-based payments expense		34.5			41.5
Non-cash interest income on payment-in-kind notes		—			(60.9	)
Receipt of interest on payment-in-kind notes earned in prior years		102.8			—
Gain on collection of payment-in-kind note		(25.0	)		—
Other items, including noncurrent deferred income taxes		238.8			40.3
Change in operating assets and liabilities before effects of business acquisitions and dispositions:
Accounts receivable		(22.4	)		(91.7	)
Inventory		(311.4	)		32.3
Prepaid expenses and other current assets		(17.0	)		52.1
Accounts payable		151.0			81.5
Accrued payroll		(115.3	)		69.9
Other accrued liabilities		110.7			106.0
Net cash flows from operating activities — continuing operations		939.7			1,132.0
Net cash flows from operating activities — discontinued operations		0.2			(25.5	)
Net cash flows from operating activities		939.9			1,106.5
Cash flows from investing activities:
Additions to property, plant and equipment		(347.4	)		(359.6	)
Sale of property, plant and equipment		1.2			4.4
Proceeds from collection of payment-in-kind note		412.5			—
Advances from insurance carriers related to Garner accident		18.1			17.3
Purchase of businesses and intangible assets		(149.0	)		(3.0	)
Sale of business, intangibles and other assets		—			21.7
Net cash flows from investing activities — continuing operations		(64.6	)		(319.2	)
Net cash flows from investing activities — discontinued operations		245.7			2.7
Net cash flows from investing activities		181.1			(316.5	)
Cash flows from financing activities:
Repayment of long-term debt		(291.7	)		(12.4	)
Repurchase of ConAgra Foods, Inc. common shares		(662.4	)		—
Cash dividends paid		(276.7	)		(257.9	)
Exercise of stock options and issuance of other stock awards		30.0			18.7
Other items		2.0			2.2
Net cash flows from financing activities — continuing operations		(1,198.8	)		(249.4	)
Net cash flows from financing activities — discontinued operations		(0.1	)		(0.5	)
Net cash flows from financing activities		(1,198.9	)		(249.9	)
Effect of exchange rate changes on cash and cash equivalents		7.6			2.3
Net change in cash and cash equivalents		(70.3	)		542.4
Cash and cash equivalents at beginning of period		953.2			243.2
Cash and cash equivalents at end of period	$	882.9		$	785.6

# # #

EX-99.2

Exhibit 99.2

Q3 FY11 Question & Answer
March 24, 2011

1. What were some examples of brands in the Consumer Foods segment posting sales growth for the quarter?

- Banquet	- Manwich	- Rosarita
- Blue Bonnet	- Marie Callender’s	- Slim Jim
- DAVID	- Parkay	- Snack Pack
- Healthy Choice	- Peter Pan	- Swiss Miss
- Hebrew National	- Reddi-wip	- Wesson
- Lightlife	- Ro*Tel	- Wolf

	Sales for ACT II were in line with last year’s sales for the quarter.
2.	What were some examples of brands in the Consumer Foods segment posting sales declines for the quarter?

- Andy Capp’s	- La Choy
- Chef Boyardee	- Libby’s
- Crunch’n Munch	- Orville Redenbacher’s
- Egg Beaters	- PAM
- Hunt’s	- Van Camp’s
- Kid Cuisine

3.	What were unit volume changes for the quarter in the Consumer Foods and Commercial Foods Segments?
	Consumer Foods’ organic unit volume was flat.
	Commercial Foods’ volume was flat.
4.	How much was total depreciation and amortization from continuing operations for the quarter?
	Approximately $91 million (versus approximately $82 million in Q3 FY10)
5.	How much were capital expenditures from continuing operations for the quarter?
	Approximately $136 million (versus approximately $120 million in Q3 FY10)
6.	What was the net interest expense for the quarter?
	Approximately $52 million (versus approximately $40 million in Q3 FY10)

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7.	What was corporate expense for the quarter?
	Approximately $26 million for the quarter (versus approximately $88 million in Q3 FY10). Current-quarter amounts include $24 million of net hedging benefit, and a $25 million gain related to early repayment of payment-in-kind notes receivable by a debtor. Prior-year amounts include $15 million of benefit related to favorable adjustments in environmental liabilities. Excluding these amounts, Corporate expense was $75 million for the current quarter and $103 million in the year-ago period; the decrease largely reflects lower incentive compensation expense and other benefits from ongoing cost reduction efforts.
8.	How much did the company pay in dividends for the quarter?
	Approximately $100 million (versus approximately $89 million in Q3 FY10). On Sept. 21, 2010, the Board of Directors approved a dividend increase by raising the quarterly dividend to $0.23 per share from $0.20 per share, resulting in a higher payment versus the year-ago period.
9.	How many shares of stock did the company repurchase during the quarter?
	The company repurchased approximately 21.4 million shares during Q3 FY11.
10.	What was the weighted average number of diluted shares outstanding for the quarter (rounded)?
	Approximately 433 million shares for the quarter
11.	What were the gross margins and operating margins for the quarter ($ amounts in millions, rounded)?
	Gross margin = segment gross profit* divided by net sales
	Gross margin = $774/$3,155 = 25%
	Operating margin = segment operating profit** divided by net sales
	Operating margin = $403/$3,155 = 13%
*	Gross profit = net sales – costs of goods sold ($3,155 – $2,381 = $774)
**	See third-quarter segment operating results for a reconciliation of operating profit to income from continuing operations before income taxes and equity method investment earnings (loss). Income from continuing operations before income taxes and equity method investment earnings (loss), divided by net sales = $326/$3,155 = 10%.
12.	What is included in the company’s net debt at the end of the quarter (rounded, in millions)?

	Q3 FY11
Total debt*	$	3,235
Less: Cash on hand	$	883
Net debt total	$	2,352

* Total debt = notes payable, short-term debt, long-term debt, and subordinated debt

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13.	What is the net debt to total capital ratio at quarter-end?
	The net debt to total capital ratio for the quarter was 34%.
	This ratio is defined as net debt divided by the sum of net debt plus shareholder equity. See question No. 12 for the components of net debt.
14.	What was the effective tax rate for the quarter?
	The effective tax rate for continuing operations for the quarter was 35%.
15.	What is the projected tax rate for FY11?
	The company continues to expect the continuing operations effective tax rate for the full fiscal year 2011 to be approximately 34%, adjusted for items impacting comparability.
16.	What are the projected capital expenditures for FY11?
	Total capital expenditures for FY11 are expected to be approximately $475 million, which will be partly offset by insurance proceeds related to the accident at the Garner, N.C., manufacturing facility.
17.	What is the expected net interest expense for FY11?
	Net interest expense is expected to be approximately $180 million.

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Note on Forward-looking Statements:

This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current views and assumptions of future events and financial performance and are subject to uncertainty and changes in circumstances. The company undertakes no responsibility for updating these statements. Readers of this release should understand that these statements are not guarantees of performance or results. Many factors could affect the company’s actual financial results and cause them to vary materially from the expectations contained in the forward-looking statements. These factors include, among other things: availability and prices of raw materials; the impact of the accident at the Garner, N.C., manufacturing facility, including the ultimate costs incurred and the amounts received under insurance policies; the effectiveness of its product pricing; future economic circumstances; industry conditions; the company’s ability to execute its operating plans; the success of the company’s innovation, marketing, and cost-saving initiatives; the amount and timing of repurchases of the company’s common stock, if any; the competitive environment and related market conditions; operating efficiencies; the ultimate impact of the company’s product recalls; access to capital; actions of governments and regulatory factors affecting the company’s businesses, including the Patient Protection and Affordable Care Act; and other risks described in the company’s reports filed with the Securities and Exchange Commission. The company cautions readers not to place undue reliance on any forward-looking statements included in this release, which speak only as of the date of this release.

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