10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.   20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended August 28, 2005

OR

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

For the transition period from                       to

Commission File Number 1-7275

CONAGRA FOODS, INC.

(Exact name of registrant, as specified in charter)

Delaware	47-0248710
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)
One ConAgra Drive, Omaha, Nebraska	68102-5001
(Address of Principal Executive Offices)	(Zip Code)

(402) 595-4000

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report.)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes   ý                  No   o

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Yes   ý                  No   o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)

Yes   o                  No   ý

Number of shares outstanding of issuer’s common stock, as of September 23, 2005, was 518,914,830.

Part I – Financial Information

Item 1.  Condensed Consolidated Financial Statements

ConAgra Foods, Inc. and Subsidiaries

Condensed Consolidated Statements of Earnings

(in millions except per share amounts)

(unaudited)

	Thirteen weeks ended
	August 28, 2005			August 29, 2004
Net sales	$	3,362.9		$	3,383.2
Costs and expenses:
Cost of goods sold	2,635.4			2,700.4
Selling, general and administrative expenses	434.0			410.1
Interest expense, net	68.1			73.4
Gain on sale of Pilgrim’s Pride Corporation common stock	329.4			—
Income from continuing operations before income taxes and equity method investment earnings (loss)	554.8			199.3
Income tax expense	193.6			81.0
Equity method investment earnings (loss)	(13.9		)	14.1
Income from continuing operations	347.3			132.4
Income from discontinued operations, net of tax	4.8			2.3
Net income	$	352.1		$	134.7
Earnings per share – basic
Income from continuing operations	$	0.67		$	0.26
Income from discontinued operations	0.01			—
Net income	$	0.68		$	0.26
Earnings per share – diluted
Income from continuing operations	$	0.67		$	0.26
Income from discontinued operations	0.01			—
Net income	$	0.68		$	0.26

See notes to the condensed consolidated financial statements.

2

ConAgra Foods, Inc. and Subsidiaries

Condensed Consolidated Statements of Comprehensive Income

(in millions)

(unaudited)

	Thirteen weeks ended
	August 28, 2005			August 29, 2004
Net income	$	352.1		$	134.7
Other comprehensive income (loss):
Net derivative adjustment, net of tax	28.7			(24.4		)
Unrealized gain (loss) on available-for-sale securities, net of tax:
Unrealized holding gains (losses) arising during the period	(19.8		)	0.2
Less: reclassification adjustment for gains included in net income	(95.3		)	—
Currency translation adjustment	(0.1		)	9.4
Comprehensive income	$	265.6		$	119.9

See notes to the condensed consolidated financial statements.

3

ConAgra Foods, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(dollars in millions)

(unaudited)

	August 28, 2005			May 29, 2005			August 29, 2004
ASSETS
Current assets
Cash and cash equivalents	$	501.4		$	207.6		$	369.8
Receivables, less allowance for doubtful accounts of $31.7, $30.7 and $28.2	1,286.8			1,292.0			1,322.9
Inventories	2,756.3			2,614.5			2,584.9
Prepaid expenses and other current assets	736.9			631.3			547.9
Current assets of discontinued operations	8.5			29.4			257.6
Total current assets	5,289.9			4,774.8			5,083.1
Property, plant and equipment	5,764.1			5,735.6			5,674.6
Less accumulated depreciation	(2,929.6		)	(2,887.3		)	(2,805.9		)
Property, plant and equipment, net	2,834.5			2,848.3			2,868.7
Goodwill	3,794.0			3,797.7			3,791.2
Brands, trademarks and other intangibles, net	819.3			819.7			826.4
Other assets	444.4			798.4			1,564.9
Noncurrent assets of discontinued operations	0.4			3.9			54.9
	$	13,182.5		$	13,042.8		$	14,189.2
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Notes payable	$	10.8		$	8.5		$	22.4
Current installments of long-term debt	119.1			117.3			366.9
Accounts payable	926.9			818.4			863.4
Advances on sales	128.8			149.6			103.0
Accrued payroll	194.3			272.4			175.4
Other accrued liabilities	1,341.5			1,263.3			1,420.3
Current liabilities of discontinued operations	4.2			10.2			181.0
Total current liabilities	2,725.6			2,639.7			3,132.4
Senior long-term debt, excluding current installments	3,943.5			3,949.1			4,887.1
Subordinated debt	400.0			400.0			400.3
Other noncurrent liabilities	1,121.9			1,194.6			1,154.8
Total liabilities	8,191.0			8,183.4			9,574.6
Commitments and contingencies (Note 10)
Common stockholders’ equity
Common stock of $5 par value, authorized 1,200,000,000 shares; issued 566,063,997, 565,942,765 and 565,886,206	2,830.3			2,829.7			2,829.4
Additional paid-in capital	755.2			761.6			754.5
Retained earnings	2,649.0			2,438.1			2,351.6
Accumulated other comprehensive income (loss)	(42.5		)	44.0			5.1
Less treasury stock, at cost, 47,385,348, 47,841,291 and 51,599,271 common shares	(1,196.7		)	(1,209.3		)	(1,311.1		)
	4,995.3			4,864.1			4,629.5
Less unearned restricted stock and common shares held in Employee Equity Fund (0, 0, and 373,601)	(3.8		)	(4.7		)	(14.9		)
Total common stockholders’ equity	4,991.5			4,859.4			4,614.6
	$	13,182.5		$	13,042.8		$	14,189.2

See notes to the condensed consolidated financial statements.

4

ConAgra Foods, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(in millions)

(unaudited)

	Thirteen weeks ended
	August 28, 2005			August 29, 2004
Cash flows from operating activities:
Net income	$	352.1		$	134.7
Income from discontinued operations	4.8			2.3
Income from continuing operations	347.3			132.4
Adjustments to reconcile income from continuing operations to net cash flows from operating activities:
Depreciation and amortization	88.5			87.7
Gain on sale of Pilgrim’s Pride Corporation common stock, pretax (see Note 2)	(329.4		)	—
Loss on sale of fixed assets	0.1			—
Undistributed earnings of affiliates	(3.4		)	(11.1		)
Non-cash impairments	19.4			—
Other items (includes pension and other postretirement benefits)	(2.8		)	1.6
Change in operating assets and liabilities before effects of business dispositions:
Accounts receivable	2.8			(22.1		)
Inventory	(141.9		)	(68.4		)
Prepaid expenses and other current assets	(76.9		)	(59.6		)
Accounts payable and advances on sales	87.8			(110.8		)
Other accrued liabilities	3.2			202.1
Net cash flows from operating activities – continuing operations	(5.3		)	151.8
Net cash flows from operating activities – discontinued operations	10.1			4.1
Net cash flows from operating activities	4.8			155.9
Cash flows from investing activities:
Additions to property, plant and equipment	(70.6		)	(105.2		)
Sale of Pilgrim’s Pride Corporation common stock	482.4			—
Sale of plant and equipment	6.4			8.3
Notes receivable and other items	(1.7		)	1.7
Net cash flows from investing activities – continuing operations	416.5			(95.2		)
Net cash flows from investing activities – discontinued operations	13.1			29.8
Net cash flows from investing activities	429.6			(65.4		)
Cash flows from financing activities:
Net short-term borrowings	2.3			(8.2		)
Repayment of long-term debt	(8.9		)	(17.8		)
Repurchase of ConAgra Foods common shares	—			(181.4		)
Cash dividends paid	(141.0		)	(135.5		)
Proceeds from exercise of employee stock options	7.3			12.2
Other items	(0.3		)	(0.3		)
Net cash flows from financing activities – continuing operations	(140.6		)	(331.0		)
Net cash flows from financing activities – discontinued operations	—			1.7
Net cash flows from financing activities	(140.6		)	(329.3		)
Net change in cash and cash equivalents	293.8			(238.8		)
Cash and cash equivalents at beginning of period	207.6			608.6
Cash and cash equivalents at end of period	$	501.4		$	369.8

See notes to the condensed consolidated financial statements.

5

ConAgra Foods, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

For the Thirteen Weeks ended August 28, 2005

(columnar dollars in millions except per share amounts)

1.Summary of Significant Accounting Policies

The unaudited financial information reflects all adjustments, which are, in the opinion of management, necessary for a fair presentation of the results of operations, financial position and cash flows for the periods presented.  The adjustments are of a normal recurring nature, except as otherwise noted. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in the ConAgra Foods, Inc. (the “company”) fiscal 2005 annual report on Form 10-K.

The results of operations for any quarter or a partial fiscal year period are not necessarily indicative of the results to be expected for other periods or the full fiscal year.

Basis of Consolidation – The condensed consolidated financial statements include the accounts of ConAgra Foods, Inc. and all majority-owned subsidiaries.  In addition, the accounts of all variable interest entities of which the company is determined to be the primary beneficiary are included in the company’s condensed consolidated financial statements from the date such determination is made.  All significant intercompany investments, accounts and transactions have been eliminated.

Stock-Based Compensation – The company has stockholder approved stock option plans which provide for granting of options to employees for purchase of common stock at prices equal to the fair value at the time of grant.  The company accounts for its employee stock option plans in accordance with Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees.  Accordingly, no stock-based compensation expense is reflected in net income for stock options granted, as options granted under these plans have an exercise price equal to the market value of the underlying common stock on the date of grant.  The company issues stock under various stock-based compensation arrangements approved by stockholders, including restricted stock, phantom stock and stock issued in lieu of cash bonuses.  The value of restricted and phantom stock, equal to fair value at the time of grant, is amortized as compensation expense over the vesting period.  Stock issued in lieu of cash bonuses is recognized as compensation expense as earned.  In addition, the company grants restricted share equivalents.  The restricted share equivalents are credited with appreciation or depreciation in the company’s stock during the restriction period and will be settled in cash when the restriction period ends.  The company amortizes the expense associated with the restricted share equivalents over the period of restriction.

6

ConAgra Foods, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

For the Thirteen Weeks ended August 28, 2005

(columnar dollars in millions except per share amounts)

The following table illustrates the pro forma effect on net income and earnings per share assuming the company had followed the fair value recognition provisions of Statement of Financial Accounting Standards (“SFAS”) No. 123, Accounting for Stock-Based Compensation, for all outstanding and unvested stock options and other stock-based compensation.

	Thirteen weeks ended
	August 28, 2005			August 29, 2004
Net income, as reported	$	352.1		$	134.7
Add: Stock-based employee compensation included in reported net income, net of related tax effects	2.6			3.6
Deduct: Total stock-based compensation expense determined under fair value based method, net of related tax effects	(5.3		)	(7.8		)
Pro forma net income	$	349.4		$	130.5
Earnings per share:
Basic earnings per share – as reported	$	0.68		$	0.26
Basic earnings per share – pro forma	$	0.67		$	0.25
Diluted earnings per share – as reported	$	0.68		$	0.26
Diluted earnings per share – pro forma	$	0.67		$	0.25

Comprehensive Income – Comprehensive income includes net income, currency translation adjustments, certain derivative-related activity, changes in the value of available-for-sale investments and changes, if any, in the minimum pension liability.  The company generally deems its foreign investments to be permanent in nature and does not provide for taxes on currency translation adjustments arising from converting the investment in a foreign currency to U.S. dollars.  When the company determines that a foreign investment is no longer permanent in nature, estimated taxes are provided for the related deferred tax liability (asset), if any, resulting from currency translation adjustments.

The following details the income tax expense (benefit) on components of other comprehensive income (loss):

	Thirteen weeks ended
	August 28, 2005			August 29, 2004
Net derivative adjustment	$	16.5		$	(14.9	)
Unrealized gains (losses) on available-for-sale securities	(11.6		)	0.1
Less: reclassification adjustment for gains included in net income	(54.8		)	—
	$	(49.9	)	$	(14.8	)

7

ConAgra Foods, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

For the Thirteen Weeks ended August 28, 2005

(columnar dollars in millions except per share amounts)

Reclassifications – Certain reclassifications have been made to prior year amounts to conform to current year classifications.  The company has reclassified the fair value of certain derivative contracts for which it does not have the legal right of offset, which had previously been presented on a net basis, to a gross presentation within prepaid expenses and other current assets and other accrued liabilities.  This change in presentation resulted in an increase to both prepaid expenses and other current assets and other accrued liabilities of $164.1 million, $251.1 million, and $175.3 million as of August 28, 2005, May 29, 2005, and August 29, 2004, respectively.

Recently Issued Accounting Pronouncements – In December 2004, the FASB issued Statement No. 123 (revised 2004) (“SFAS No. 123R”), Share-Based Payment. SFAS No. 123R will require the company to measure the cost of all employee stock-based compensation awards based on the grant date fair value of those awards and to record that cost as compensation expense over the period during which the employee is required to perform service in exchange for the award (generally over the vesting period of the award).  Accordingly, the adoption of SFAS No. 123R will have an impact on the company’s results of operations, although it will have no impact on the company’s overall financial position.  SFAS No. 123R is effective beginning in the company’s first quarter of fiscal 2007. Management is currently evaluating the impact that the adoption of this statement will have on the company’s consolidated results of operations and cash flows.

In November 2004, the FASB issued SFAS No. 151, Inventory Costs, an amendment of ARB No. 43, Chapter 4.  SFAS No. 151 amends the guidance in ARB No. 43, Inventory Pricing, for abnormal amounts of idle facility expense, freight, handling costs, and wasted material (spoilage), requiring that those items be recognized as current-period expenses.  This statement also requires that allocation of fixed production overheads to the costs of conversion be based on the normal capacity of the production facilities.  The statement is effective for inventory costs incurred beginning in the company’s fiscal 2007.  Management is currently evaluating the impact that the adoption of this statement will have on the company’s consolidated financial position and results of operations.

In December 2004, the FASB issued SFAS No. 153, Exchanges of Nonmonetary Assets, an amendment of APB Opinion No. 29.  APB Opinion No. 29, Accounting for Nonmonetary Transactions, is based on the principle that exchanges of nonmonetary assets should be measured based on the fair value of the assets exchanged.  SFAS No. 153 amends APB Opinion No. 29, eliminating the exception to fair value accounting for nonmonetary exchanges of similar productive assets, and replaces it with a general exception to fair value accounting for nonmonetary exchanges that do not have commercial substance.  A nonmonetary exchange has commercial substance if the future cash flows of the entity are expected to change significantly as a result of the exchange.  The statement is effective for nonmonetary asset exchanges occurring in fiscal periods beginning after June 15, 2005.  Management does not expect this statement to have a material impact on the company’s consolidated financial position or results of operations.

In March 2005, the FASB issued FASB Interpretation No. 47, Accounting for Conditional Asset Retirement Obligations, an Interpretation of FASB Statement No. 143 (“FIN 47”).  FIN 47 clarifies that the term “conditional asset retirement obligation”, as used in SFAS No. 143, Accounting for Asset Retirement Obligations, refers to a legal obligation to perform an asset retirement activity in which the timing and (or) method of settlement are conditional on a future event that may or may not be within the control of the entity.  The obligation to perform the asset retirement activity is unconditional even though uncertainty exists about the timing and (or) method of settlement.  Thus, the timing and (or) method of settlement may be conditional on a future event.  Accordingly, an entity is required to recognize a liability for the fair value of a conditional asset retirement obligation if the fair value of the liability can be reasonably estimated.  The statement must be applied by the end of fiscal 2006.  Management does not expect this

8

ConAgra Foods, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

For the Thirteen Weeks ended August 28, 2005

(columnar dollars in millions except per share amounts)

statement to have a material impact on the company’s consolidated financial position or results of operations.

Use of Estimates – Preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions.  These estimates and assumptions affect reported amounts of assets, liabilities, revenues and expenses as reflected in the financial statements.  Actual results could differ from these estimates.

2.Discontinued Operations and Divestitures

Chicken Business Divestiture

In November 2003, the company completed the sale of its chicken business to Pilgrim’s Pride Corporation (the “chicken business divestiture”).  A portion of the proceeds from this divestiture was in the form of 25.4 million shares of Pilgrim’s Pride Corporation common stock initially valued at $246.1 million.  The fair value of the Pilgrim’s Pride common stock was based on an independent valuation as of the date of the transaction and was reflective of the common stock’s trading restrictions.

During the third quarter of fiscal 2005, the company sold ten million shares of the Pilgrim’s Pride Corporation common stock for $282.5 million, resulting in a pre-tax gain of $185.7 million and a net-of-tax reclassification from accumulated other comprehensive income of $115.2 million.

During the first quarter of fiscal 2006, the company sold the remaining 15.4 million shares of the Pilgrim’s Pride Corporation common stock for $482.4 million, resulting in a pre-tax gain of $329.4 million ($209.3 million after tax) and a net-of-tax reclassification from accumulated other comprehensive income of $95.3 million.  The following table provides details of the gain recognized in the first quarter of fiscal 2006:

Amounts included in accumulated other comprehensive income at May 29, 2005 for 6.96 million shares classified as available-for-sale	$	180.5
Reduction in value (including sales commission) associated with shares classified as available-for-sale from May 29, 2005 to August 3, 2005	(34.0		)
Gain realized on the additional 8.48 million shares not classified as available-for-sale	182.9
Total pre-tax gain	$	329.4

UAP North America and UAP International Divestitures

In the fourth quarter of fiscal 2005, the company completed the disposition of the remaining businesses of its Agricultural Products segment (“UAP International”).  The company reflects the results of the Agricultural Products segment as discontinued operations for all periods presented.

Portuguese Poultry Divestiture

The company completed the sale of the Portuguese poultry business for cash proceeds of $3.6 million in the first quarter of fiscal 2005.  The company removed the results of this business from the Food Ingredients reporting segment and reflects the results of this business as discontinued operations for all periods presented.

9

ConAgra Foods, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

For the Thirteen Weeks ended August 28, 2005

(columnar dollars in millions except per share amounts)

Specialty Meats Divestiture

In the fourth quarter of fiscal 2005, the company implemented a plan to exit the specialty meats foodservice business.  The company closed a manufacturing facility in Alabama, sold its operations in California and, in the first quarter of fiscal 2006, completed the sale of its operations in Illinois.  Upon the sale of the Illinois operations, the company has no remaining specialty meats foodservice operations.  Accordingly, the company removed the results of these businesses from the Foodservice Products reporting segment and reflects the results of these businesses as discontinued operations for all periods presented.

The company recorded charges in the third and fourth quarters of fiscal 2005, reducing the carrying values of the assets at the Alabama and Illinois facilities to their expected salvage values.  During the first quarter of fiscal 2006, the company sold these facilities and recognized pre-tax gains within results of discontinued operations totaling approximately $6 million.

Fresh Beef and Pork Divestitures

In September 2002, the company sold a controlling interest in its fresh beef and pork operations to a joint venture led by Hicks, Muse, Tate & Furst Incorporated (“Hicks Muse”).  The fresh beef operations sold to the joint venture included a beef processing business as well as a cattle feeding business.  The company reported its share of the earnings associated with its minority ownership of the joint venture as equity method investment earnings.  The company sold its remaining minority interest investment in the fresh beef and pork business (“Swift Foods”) to Hicks Muse in September 2004.  Due to the purchase price of the cattle feeding business being entirely financed by the company, the legal divestiture of the cattle feeding operation was not recognized as a divestiture for accounting purposes, and the assets, liabilities and results of operations of the cattle feeding business were reflected in the company’s financial statements prior to October 15, 2004.  Beginning September 24, 2004, following orderly liquidation of the cattle feeding business, the assets, liabilities and results of operations, including the gain on sale, of the cattle feeding business are classified as discontinued operations.

The company continues to hold subordinated notes in the original principal amount of $150 million plus accrued interest of $38.8 million from Swift Foods.  During the company’s fourth quarter of fiscal 2005, Swift Foods effected changes in its capital structure.  As a result of those changes, the company determined that the fair value of the subordinated notes was impaired.  The company believes this impairment of an available-for-sale security is temporary.  As such, the company has reduced the carrying value of the note by $40.0 million and recorded after-tax charges of $24.9 million in accumulated other comprehensive income.

10

ConAgra Foods, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

For the Thirteen Weeks ended August 28, 2005

(columnar dollars in millions except per share amounts)

Summary results of operations of the former Agricultural Products segment, the chicken business, the Portuguese poultry businesses, the cattle feeding business and the specialty meats foodservice business included within discontinued operations are as follows:

	Thirteen weeks ended
	August 28, 2005			August 29, 2004
Net sales	$	16.1		$	228.9
Long-lived asset impairment charge	$	—		$	1.2
Income (loss) from operations of discontinued operations before income taxes	(0.9		)	5.7
Net gain from disposal of businesses	6.0			—
Income before income taxes	5.1			4.5
Income tax expense	(0.3		)	(2.2		)
Income from discontinued operations, net of tax	$	4.8		$	2.3

The assets and liabilities of the former Agricultural Products segment and the specialty meats foodservice business as of August 28, 2005, May 29, 2005 and August 29, 2004 are as follows:

	August 28, 2005		May 29, 2005		August 29, 2004
Receivables, less allowances for doubtful accounts	$	0.9	$	0.9	$	148.2
Inventories	7.6		28.5		103.8
Prepaid expenses and other current assets	—		—		5.6
Current assets of discontinued operations	$	8.5	$	29.4	$	257.6
Property, plant and equipment, net	$	0.4	$	3.9	$	46.1
Goodwill and other intangibles	—		—		8.0
Other assets	—		—		0.8
Noncurrent assets of discontinued operations	$	0.4	$	3.9	$	54.9
Notes payable	$	—	$	—	$	24.9
Accounts payable	3.1		6.1		123.5
Other accrued liabilities and advances on sales	1.1		4.1		32.6
Current liabilities of discontinued operations	$	4.2	$	10.2	$	181.0

11

ConAgra Foods, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

For the Thirteen Weeks ended August 28, 2005

(columnar dollars in millions except per share amounts)

3.Goodwill and Other Identifiable Intangible Assets

Goodwill by reporting segment was as follows:

	August 28, 2005		May 29, 2005		August 29, 2004
Retail Products	$	3,474.5	$	3,477.7	$	3,477.2
Foodservice Products	282.7		283.2		277.2
Food Ingredients	36.8		36.8		36.8
Total	$	3,794.0	$	3,797.7	$	3,791.2

Other identifiable intangible assets were as follows:

	August 28, 2005				May 29, 2005				August 29, 2004
	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Non-amortizing intangible assets	$	790.5	$	—	$	790.5	$	—	$	798.1	$	—
Amortizing intangible assets	42.5		13.7		42.1		12.9		39.0		10.7
	$	833.0	$	13.7	$	832.6	$	12.9	$	837.1	$	10.7

Non-amortizing intangible assets are comprised of the following balances:

	August 28, 2005		May 29, 2005		August 29, 2004
Brands/Trademarks	$	769.6	$	769.6	$	776.5
Pension Intangible Asset	19.5		19.5		20.2
Miscellaneous	1.4		1.4		1.4
Total non-amortizing intangible assets	$	790.5	$	790.5	$	798.1

Amortizing intangible assets, carrying a weighted average life of approximately 16 years, are principally composed of licensing arrangements and customer lists.  Based on amortizing assets recognized in the company’s balance sheet as of August 28, 2005, amortization expense is estimated to be approximately $2.7 million for each of the next five years.

4.Derivative Financial Instruments

The fair value of derivative assets is recognized within prepaid expenses and other current assets, while the fair value of derivative liabilities is recognized within other accrued liabilities.  As of August 28, 2005, May 29, 2005 and August 29, 2004, the fair value of derivatives recognized within prepaid expenses and other current assets was $506.2 million, $300.2 million and $238.3 million, respectively, while the amount recognized within other accrued liabilities was $182.2 million, $266.9 million and $192.3 million, respectively.

12

ConAgra Foods, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

For the Thirteen Weeks ended August 28, 2005

(columnar dollars in millions except per share amounts)

For the quarters ending August 28, 2005 and August 29, 2004, the ineffectiveness associated with derivatives designated as cash flow and fair value hedges from continuing operations resulted in a gain of $5.6 million and a gain of $0.2 million, respectively.  Hedge ineffectiveness is recognized within net sales, cost of goods sold or interest expense, depending on the nature of the hedge.  The company does not exclude any component of the hedging instrument’s gain or loss when assessing effectiveness.

Generally, the company hedges a portion of its anticipated consumption of certain commodity inputs for periods ranging from 12 to 36 months.  The company may enter into longer-term hedges on particular commodities if deemed appropriate.  As of August 28, 2005, the company had hedged certain portions of its anticipated consumption of commodity inputs through March 2008.

As of August 28, 2005, May 29, 2005 and August 29, 2004, the net deferred gain or loss recognized in accumulated other comprehensive income was a $36.4 million gain, a $7.7 million gain and a $16.3 million loss, net of tax, respectively. The company anticipates a gain of $22.0 million, net of tax, will be transferred out of accumulated other comprehensive income and recognized within earnings over the next 12 months.  The company anticipates a gain of $14.4 million, net of tax, will be transferred out of accumulated other comprehensive income and recognized within earnings subsequent to the next 12 months.

In order to reduce exposures related to changes in interest rates, the company may use derivative instruments, including interest rate swaps.  During fiscal 2004, the company closed out all $2.5 billion of its interest rate swap agreements in order to lock-in existing favorable interest rates.  These interest rate swap agreements were previously put in place as a strategy to hedge interest costs associated with long-term debt.  For financial statement and tax purposes the proceeds received upon termination of the interest rate swap agreements is being recognized over the term of the debt instruments originally hedged.

Of the $2.5 billion interest rate swaps closed out in fiscal 2004, $2.0 billion of the interest rate swaps had been used to effectively convert certain of the company’s fixed rate debt into floating rate debt.  These interest rate swaps were accounted for as fair value hedges and resulted in no recognition of ineffectiveness in the statement of earnings as the interest rate swaps’ provisions matched the applicable provisions of the hedged debt.  The remaining $500 million portion of the company’s interest rate swaps was used to hedge certain of the company’s forecasted interest payments on floating rate debt for the period from 2005 through 2011.  These interest rate swaps were accounted for as cash flow hedges with gains and losses deferred in accumulated other comprehensive income.  During the second quarter of fiscal 2005, the company determined it was no longer probable that the related floating rate debt would be issued and therefore the company recognized approximately $13.6 million of additional interest expense associated with this interest rate swap.  The company’s net interest expense was reduced by $4.0 million due to the net impact of interest rate swap agreements in the first quarter of fiscal 2006 and by $14.3 million in the comparable period of fiscal 2005.

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ConAgra Foods, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

For the Thirteen Weeks ended August 28, 2005

(columnar dollars in millions except per share amounts)

5.Earnings Per Share

Basic earnings per share is calculated on the basis of weighted average outstanding common shares.  Diluted earnings per share is computed on the basis of basic weighted average outstanding common shares adjusted for the dilutive effect of stock options, restricted stock awards and other dilutive securities.

The following table reconciles the income and average share amounts used to compute both basic and diluted earnings per share:

	Thirteen weeks ended
	August 28, 2005		August 29, 2004
Net income:
Income from continuing operations	$	347.3	$	132.4
Income from discontinued operations, net of tax	4.8		2.3
Net income	$	352.1	$	134.7
Weighted Average Shares Outstanding:
Basic weighted average shares outstanding	518.1		517.0
Add: Dilutive effect of stock options, restricted stock awards and other dilutive securities	2.4		4.4
Diluted weighted average shares outstanding	520.5		521.4

For the first quarter of fiscal 2006 there were 13.8 million stock options outstanding that were excluded from the computation of shares contingently issuable upon exercise of the stock options because exercise prices exceeded the average market value of common stock during the period.  For the first quarter of fiscal 2005, 7.9 million stock options were excluded from the calculation.

6.Inventories

The major classes of inventories are as follows:

	August 28, 2005		May 29, 2005		August 29, 2004
Raw materials and packaging	$	1,110.6	$	1,013.0	$	974.8
Work in process	101.3		79.7		101.7
Finished goods	1,393.9		1,382.4		1,317.8
Supplies and other	150.5		139.4		190.6
	$	2,756.3	$	2,614.5	$	2,584.9

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ConAgra Foods, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

For the Thirteen Weeks ended August 28, 2005

(columnar dollars in millions except per share amounts)

7.Cost Reduction Efforts

In fiscal 2004, the company identified specific operating efficiency initiatives as part of an effort to improve the company’s cost structure, margins and competitive position.  As a result of these specific initiatives, the company recognized certain expenses during fiscal 2004 and 2005, including employee termination costs, accelerated depreciation on fixed assets, equipment/employee relocation costs, asset impairments and other related costs.  The company recognized $13.6 million of expenses in the first quarter of fiscal 2005 for these initiatives.  These costs were primarily incurred in the Retail Products segment.

As part of the company’s ongoing efforts to reduce general and administrative expenses, including salaried headcount, during the fourth quarter of fiscal 2005 the company announced it was in the process of eliminating several hundred salaried jobs across the organization and recognized $42.7 million of severance expense primarily within its Retail Products segment and Corporate.  The headcount reductions were largely completed during the first quarter of fiscal 2006.  As of August 28, 2005, $24.8 million was included in other accrued liabilities in the company’s consolidated balance sheet for the settlement of severance costs.  These liabilities are expected to be paid over the next several months.

8.Plant Closure Charges and Asset Impairments

As a result of a Retail Products plant closure in the first quarter of fiscal 2006, the company recognized pre-tax charges of $6.5 million, primarily for expenses related to severance and accelerated depreciation.

Also during the first quarter of fiscal 2006, the company determined that the carrying value of its investments in two unrelated joint ventures were other than temporarily impaired and therefore recognized pre-tax impairment charges totaling $19.4 million ($17.4 million after tax).  These charges are reflected in equity method investment earnings (loss) in the consolidated statement of earnings.  The extent of the impairments was determined based upon the company’s assessment of the recoverability of its investments based primarily upon the expected proceeds of planned dispositions of the investments.

9. Income Taxes

In the first quarter of fiscal 2006 and 2005, the company’s income tax expense was $193.6 million and $81.0 million, respectively.  The effective tax rate (calculated as the ratio of income tax expense to pre-tax income from continuing operations, inclusive of equity method investment earnings) was approximately 36% for the first quarter of fiscal 2006 and 38% for the first quarter of fiscal 2005.  The company’s effective tax rate was lower in the first quarter of fiscal 2006 than in the first quarter of fiscal 2005 due to the impact of foreign taxes and related tax credits, increased research and development tax credits, the benefit from the new domestic manufacturing deduction, and a lower effective state income tax rate.

10.Contingencies

In fiscal 1991, the company acquired Beatrice Company (“Beatrice”).  As a result of the acquisition and the significant pre-acquisition contingencies of the Beatrice businesses and its former subsidiaries, the consolidated post-acquisition financial statements of the company reflect significant liabilities associated with the estimated resolution of these contingencies.  These include various litigation and environmental proceedings related to businesses divested by Beatrice prior to its acquisition by the company.  The environmental proceedings include litigation and administrative proceedings involving Beatrice’s status as

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ConAgra Foods, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

For the Thirteen Weeks ended August 28, 2005

(columnar dollars in millions except per share amounts)

a potentially responsible party at 31 Superfund, proposed Superfund or state-equivalent sites; these sites involve locations previously owned or operated by predecessors of Beatrice that used or produced petroleum, pesticides, fertilizers, dyes, inks, solvents, PCBs, acids, lead, sulfur, tannery wastes, and/or other contaminants.  Beatrice has paid or is in the process of paying its liability share at 30 of these sites.  Reserves for these matters have been established based on the company’s best estimate of its undiscounted remediation liabilities, which estimates include evaluation of investigatory studies, extent of required cleanup, the known volumetric contribution of Beatrice and other potentially responsible parties and its experience in remediating sites.  The reserves for Beatrice environmental matters totaled $109.6 million as of August 28, 2005, a majority of which relates to the Superfund and state equivalent sites referenced above.  Expenditures for these matters are expected to occur over a period of 5 to 20 years.

In certain limited situations, the company will guarantee an obligation of an unconsolidated entity.  Currently, the company guarantees certain obligations primarily associated with leases entered into by certain of its equity method investees and the divested fresh beef and pork business.  Under these arrangements, the company is obligated to perform under these leases (i.e., make the lease payments) should the primary obligor be unable to perform.  Most of these guarantees resulted from the company’s fresh beef and pork divestiture.  The leases have terms not exceeding 10 years and the maximum amount of future payments the company has guaranteed is approximately $44.2 million as of August 28, 2005.  The company has also assigned a hog purchase contract to the beef and pork business which has indemnified the company for all liabilities under the contract.  The company has, however, guaranteed the performance of the fresh beef and pork business with respect to the hog purchase contract.  The hog purchase contract requires the fresh beef and pork business to purchase a minimum of approximately 1.2 million hogs annually through 2014.  The contract stipulates minimum price commitments, based in part on market prices and, in certain circumstances, also includes price adjustments based on certain inputs.

On June 22, 2001, the company filed an amended annual report on Form 10-K for the fiscal year ended May 28, 2000.  The filing included restated financial information for fiscal years 1997, 1998, 1999 and 2000.  The restatement, due to accounting and conduct matters at its United Agri Products, Inc., (“UAP”) subsidiary, was based upon an investigation undertaken by the company and the Audit Committee of its Board of Directors.  The restatement was principally related to revenue recognition for deferred delivery sales and vendor rebates, advance vendor rebates and bad debt reserves.  The Securities and Exchange Commission (“SEC”) issued a formal order of nonpublic investigation dated September 28, 2001.  The company is cooperating with the SEC investigation, which relates to the UAP matters described above, as well as other aspects of the company’s financial statements, including the level and application of certain of the company’s reserves.

The company is currently conducting discussions with the SEC Staff regarding a possible settlement of these matters.  Based on discussions to date, the company estimates the amount of such settlement and related payments to be approximately $46.5 million.  The company recorded charges of $25 million and $21.5 million in fiscal 2004 and the third quarter of fiscal 2005, respectively, in connection with the expected settlement of these matters.  There can be no assurance that the negotiations with the SEC Staff will ultimately be successful or that the SEC will accept the terms of any settlement that is negotiated with the SEC Staff.  Accordingly, the terms of any settlement, if reached, could result in charges greater than the amount currently estimated and recognized in the company’s financial statements.

The company is party to a number of lawsuits and claims arising out of the operation of its business.  After taking into account liabilities recorded for all of the foregoing matters, management believes the ultimate resolution of such matters should not have a material adverse effect on the company’s financial condition, results of operations or liquidity.

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ConAgra Foods, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

For the Thirteen Weeks ended August 28, 2005

(columnar dollars in millions except per share amounts)

11.Pension and Postretirement Benefits

The company and its subsidiaries have defined benefit retirement plans (“plans”) for eligible salaried and hourly employees.  Benefits are based on years of credited service and average compensation or stated amounts for each year of service.  The company uses February 28 as its measurement date for its plans.  The company also sponsors postretirement plans which provide certain medical and dental benefits (“other benefits”) to qualifying U.S. employees.

Components of pension benefit and other postretirement benefit costs are:

	Pension						Other Postretirement
	Thirteen weeks ended						Thirteen weeks ended
	August 28, 2005			August 29, 2004			August 28, 2005			August 29, 2004
Service cost	$	15.9		$	14.7		$	0.6		$	1.0
Interest cost	31.4			30.8			5.3			7.4
Expected return on plan assets	(32.4		)	(32.8		)	(0.1		)	(0.1		)
Amortization of prior service cost	0.7			0.6			(3.2		)	(0.2		)
Amortization of transition amount	—			(0.1		)	—			—
Recognized net actuarial loss	4.7			2.6			2.0			1.9
Benefit cost – company plans	20.3			15.8			4.6			10.0
Pension benefit cost – multi-employer plans	2.0			2.3			—			—
Total benefit cost	$	22.3		$	18.1		$	4.6		$	10.0

During the thirteen weeks ended August 28, 2005, the company contributed $24.0 million to the pension plans and contributed $14.0 million to the company’s other postretirement plans.  The company anticipates making further contributions of approximately $7 million to its pension plans for the remainder of fiscal 2006. The company anticipates making further contributions in a range of $31 million to $36 million to its other postretirement plans during the remainder of fiscal 2006.  These estimates are based on current tax laws, plan asset performance and liability assumptions, which are subject to change.

12.Business Segments

The company’s operations are organized into three reporting segments:  Retail Products, Foodservice Products and Food Ingredients.  The Retail Products reporting segment includes branded foods which are sold in various retail channels and include frozen, refrigerated and shelf-stable temperature classes.  The Foodservice Products reporting segment includes branded and customized food products, including meals, entrees, prepared potatoes, meats, seafood, sauces and a variety of custom-manufactured culinary products packaged for sale to restaurants and other foodservice establishments. The Food Ingredients reporting segment includes both branded and commodity food ingredients, including milled grain ingredients, seasonings, blends and flavorings, which are sold to food processors, as well as certain commodity trading, sourcing and merchandising operations.

Intersegment sales have been recorded at amounts approximating market.  Operating profit for each segment is based on net sales less all identifiable operating expenses.  General corporate expense, gain on

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ConAgra Foods, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

For the Thirteen Weeks ended August 28, 2005

(columnar dollars in millions except per share amounts)

sale of Pilgrim’s Pride Corporation common stock, net interest expense, equity method investment earnings (loss) and income taxes have been excluded from segment operations.

Operating profit for the first quarter of fiscal 2006 at the Retail Products segment includes a $6.5 million pre-tax charge related to a plant closure.

	Thirteen weeks ended
	August 28, 2005			August 29, 2004
Sales to unaffiliated customers
Retail Products	$	1,941.6		$	2,014.2
Foodservice Products	789.9			792.2
Food Ingredients	631.4			576.8
Total	$	3,362.9		$	3,383.2
Intersegment sales
Retail Products	$	5.2		$	5.5
Foodservice Products	14.0			17.4
Food Ingredients	47.3			51.1
	66.5			74.0
Intersegment elimination	(66.5		)	(74.0		)
Total	$	—		$	—
Net sales
Retail Products	$	1,946.8		$	2,019.7
Foodservice Products	803.9			809.6
Food Ingredients	678.7			627.9
Intersegment elimination	(66.5		)	(74.0		)
Total	$	3,362.9		$	3,383.2
Operating profit
Retail Products	$	210.7		$	209.8
Foodservice Products	79.5			66.4
Food Ingredients	76.3			60.1
Total operating profit	366.5			336.3
Gain on sale of Pilgrim’s Pride Corporation common stock	329.4			—
General corporate expenses	73.0			63.6
Interest expense, net	68.1			73.4
Income tax expense	193.6			81.0
Equity method investment earnings (loss)	(13.9		)	14.1
Income from continuing operations	$	347.3		$	132.4

The company’s largest customer, Wal-Mart Stores, Inc. and its affiliates, accounted for approximately 13% and 12% of consolidated net sales for the first quarter of fiscal 2006 and 2005, respectively, primarily in the Retail Products segment.

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Part I – Financial Information

Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations.

FORWARD-LOOKING STATEMENTS

This report, including Management’s Discussion & Analysis, 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 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, future economic circumstances, industry conditions, company performance and financial results, availability and prices of raw materials, product pricing, competitive environment and related market conditions, operating efficiencies, access to capital, actions of governments and regulatory factors affecting the company’s businesses 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 report which speak only as of the date of this report.

Following is management’s discussion and analysis of the company’s operating results as well as liquidity and capital resources which should be read together with the company’s financial statements and related notes contained in this report and with the financial statements and management’s discussion and analysis in the company’s annual report on Form 10-K for the fiscal year ended May 29, 2005.  Results for the thirteen week period ended August 28, 2005 are not necessarily indicative of results that may be attained in the future.

Fiscal 2006 First Quarter Executive Overview

ConAgra Foods is one of North America’s largest packaged food companies, serving consumer grocery retailers, as well as restaurants and other foodservice establishments.  Popular ConAgra Foods consumer brands include:  ACT II, Armour, Banquet, Blue Bonnet, Brown ‘N Serve, Butterball, Chef Boyardee, Cook’s, Crunch ‘n Munch, DAVID, Eckrich, Egg Beaters, Fleischmann’s, Gulden’s, Healthy Choice, Hebrew National, Hunt’s, Kid Cuisine, Knott’s Berry Farm, La Choy, Lamb Weston, Libby’s, Louis Kemp, Lunch Makers, MaMa Rosa’s, Manwich, Marie Callender’s, Orville Redenbacher’s, PAM, Parkay, Pemmican, Peter Pan, Reddi-wip, Rosarita, Ro*Tel, Slim Jim, Snack Pack, Swiss Miss, Van Camp’s, Wesson, Wolf and many others.

Over the past few years, the company has strategically repositioned its portfolio to focus on higher-margin, branded and value-added businesses because that business mix is expected to better serve consumers, customers and shareholders over the long term.  Executing that strategy has involved acquiring branded operations and divesting commodity-related businesses.  The company is also implementing initiatives to improve the operating performance of its core business segments through more effective and efficient sales, marketing and supply chain functions.

During the first quarter of fiscal 2006, the company:

•earned $0.68 per diluted share, which includes $0.40 per diluted share gain from the sale of Pilgrim’s Pride Corporation common stock and $0.01 per diluted share of earnings from discontinued operations, as compared to first quarter fiscal 2005 diluted earnings per share of $0.26,

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•achieved 7% improvement in gross profit despite 1% decline in net sales, largely due to a favorable environment for trading and merchandising operations within the Food Ingredients segment for which gross profit increased by 41% and improved performance from the Foodservice Products segment which more than offset a 1% decline in gross profit within the Retail Products segment,

•recognized charges of $0.04 per diluted share reflecting impairments of certain equity method investments and costs associated with a plant closure,

•sold the remaining investment in Pilgrim’s Pride Corporation common stock for $482 million, thereby completing the monetization of the company’s discontinued poultry operations,

•announced the appointment of Gary Rodkin as the company’s new chief executive officer and the election of Steven F. Goldstone as the non-executive chairman, effective October 1, 2005.

Multi-Year Marketing, Operating and Business Process Improvement Initiatives

ConAgra Foods is focused on sales and marketing, operating, and business process improvement initiatives that are key to profitable future growth and stronger returns on capital.

Sales and Marketing Initiatives: Growing volumes and improving product mix is essential to long-term success, and requires the company to develop its brands, enhance customer service, find new customers, and go to market with new products that are responsive to consumer preference.

The company is implementing fact-based analytical methods for assessing the potential of its brands and products in a disciplined process.  This is designed to bring a consistency to the marketing function across retail, foodservice, and ingredients operations.  These methods address the fundamentals of the products the company sells - taste profile, packaging, product quality, and nutritional statistics - and also help design appropriate consumer communication through advertising and promotion campaigns, store merchandising programs, and appropriate price points.

Operating Initiatives:  The company is striving to achieve cost savings by integrating and upgrading the supply chain.  The primary areas of emphasis are purchasing, logistics, manufacturing, and the reduction of SKUs (stock keeping units, or individual products).

Purchasing:  The company is in the process of consolidating the purchasing activity for major inputs to more effectively and efficiently purchase inputs used across its segments.

Logistics:  The company is transitioning from a network of several hundred warehouses across the country to a network defined by 14 mixing centers that will support retail and foodservice operations in strategic locations.  This new structure is intended to better utilize truckload shipments and optimize warehouse investment, while also reducing working capital as excess inventory quantities are eliminated.

Manufacturing:  The company has been developing plans to consolidate manufacturing facilities, under which inefficient plants will most likely be closed and sold over time.  The company expects to increase capacity utilization through plant rationalization and implementation of best practices relating to overall efficiency throughout all plants, resulting in cost savings and improved margins.

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Part I – Financial Information

SKU Rationalization:  The company has reduced low-volume, low-margin SKUs over the past few quarters, and plans to continue to do this aggressively over the next 2-3 years.  SKU reduction is expected to reduce complexity and save money throughout the entire supply chain, and also result in an increased focus on the SKUs that have higher profit potential.

General and Administrative Expense and Headcount Reduction:  The company is pursuing plans for reductions in its SG&A (selling, general and administrative) cost structure, and those plans include salaried headcount reduction.  The reduction of several hundred salaried personnel was completed in the first quarter of fiscal 2006; those headcount reductions, along with other SG&A expense reduction programs, are expected to reduce planned SG&A costs by more than $100 million annually once the programs are completed.

Business Process Improvement Initiatives:  The company is changing its business processes and implementing new information systems so that it has improved connections between the manufacturing, marketing, sales, logistics, customer service and accounting functions.  The new processes are intended to improve operating efficiency and relationships with customers and vendors.  This is being done through Project Nucleus, whichintegrates the new information technology platforms and allows the company to better manage important areas such as trade merchandising programs, order management, inventory management, customer payment and collections, and logistics.

Packaged Meats

Profit margin trends for the packaged meats operations within the Retail Products and Foodservice Products segments have improved from the trends experienced during the second half of fiscal 2005.  However, gross profits for these operations remain substantially below historic levels.  The company’s packaged meats operations posted weak results in fiscal 2005, resulting primarily from higher input costs and ineffective pricing actions that did not recover the increased costs.  Also, manufacturing challenges resulting from the installation of new equipment, consolidation of plant locations and transfer of production across plant locations resulted in the disruption of the company’s ability to fill customer orders for certain products, primarily in the third quarter of fiscal 2005.  The packaged meats operations are benefiting from new management and lower pork input costs, as well as better net pricing policies that are closely linked to SKU reduction efforts and product and customer mix improvement.

Sale of Pilgrim’s Pride Corporation Common Stock

During the first quarter of fiscal 2006, the company sold its remaining 15.4 million shares of Pilgrim’s Pride Corporation common stock for $482 million, resulting in a pre-tax gain of $329 million.  This investment had been acquired as a portion of the proceeds for the sale of the company’s discontinued poultry operations in November 2003.

Opportunities and Challenges

The company believes that its sales and marketing and operating initiatives will favorably influence future profits, profit margins and returns on capital.  Because of the scope of change underway, there is risk in successfully implementing these broad change initiatives.

As described above, the company has made several changes to its retail and foodservice packaged meats businesses.  The company has begun to benefit from these changes and expects to continue to improve the profitability of these operations over time.  However, competitive pressures, input costs and the execution of

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Part I – Financial Information

the operational changes, among other factors, will affect the future profitability of these operations and the timing of any profit recovery.

The company has, over the past several quarters, experienced increased costs for many of its significant raw materials, packaging and energy inputs.  When appropriate, the company uses long-term purchase contracts, futures and options to reduce the volatility of these costs.  The company has also recently implemented sales price increases for certain products and will continue to evaluate further price increases based on raw material cost trends, expected impact on sales volumes and other factors.

Changing consumer preferences may impact sales of certain of the company’s products.  The company offers a variety of food products which appeal to a range of consumer preferences and utilizes innovation and marketing programs to develop products that fit with changing consumer trends.  As part of these programs, the company introduces new products and product extensions.

Consolidation of many of the company’s customers continues to result in increased buying power, negotiating strength and complex service requirements for those customers.  This trend, which is expected to continue, may negatively impact gross margins, particularly in the Retail Products segment.  In order to effectively respond to this customer consolidation, during fiscal 2004 the company consolidated its sales force to more efficiently service its customers.  In fiscal 2003, the company’s retail customer service centers were consolidated into one specialized facility to service all retail channel customers.  The company continues to streamline its distribution network in order to reduce costs and increase its responsiveness to customer needs.

Segment Review

The company’s operations are organized into three reporting segments:  Retail Products, Foodservice Products and Food Ingredients.  The Retail Products reporting segment includes branded foods which are sold in various retail channels and include frozen, refrigerated and shelf-stable temperature classes.  The Foodservice Products reporting segment includes branded and customized food products, including meals, entrees, prepared potatoes, meats, seafood, sauces and a variety of custom-manufactured culinary products packaged for sale to restaurants and other foodservice establishments. The Food Ingredients reporting segment includes both branded and commodity food ingredients, including milled grain ingredients, seasonings, blends and flavorings, which are sold to food processors, as well as certain commodity trading, sourcing and merchandising operations.

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Part I – Financial Information

Net Sales

	Net Sales
	Thirteen weeks ended
($ in millions) Reporting Segment	August 28, 2005		August 29, 2004		% Increase / (Decrease)
Retail Products	$	1,942	$	2,014	(4)%
Foodservice Products	790		792		—
Food Ingredients	631		577		9%
	$	3,363	$	3,383	(1)%

Net sales for the first quarter of fiscal 2006 were $3.4 billion, a decrease of $20 million, or 1%, from the same period in the prior fiscal year.  This decrease was driven primarily by the 4% decline in net sales in the Retail Products segment, partially offset by favorable results primarily in the trading and merchandising activities of the Food Ingredients segment.

Retail Products net sales for the first quarter were $1.9 billion, a decrease of $73 million, or 4%, compared to the same period in the prior year.  Sales volumes declined by 3%, reflecting the effect of price increases, customer and product mix changes, continued challenges for the packaged meats products, and to a lesser extent, the targeted reduction of SKUs.  Several major brands posted sales growth, including Butterball, Chef Boyardee, DAVID, Kid Cuisine, La Choy, Manwich, Marie Callender’s, Orville Redenbacher’s, Peter Pan, Slim Jim, Snack Pack, Van Camp’s and Wesson.  Sales declines occurred for certain large brands including ACT II, Armour, Banquet, Blue Bonnet, Cook’s, Eckrich, Egg Beaters, Healthy Choice, Hebrew National, Hunt’s, PAM, Parkay, Reddi-wip and Swiss Miss.

Foodservice Products net sales were $790 million in the first quarter of fiscal 2006 and $792 million in the same period of the prior year, reflecting improved sales volumes in specialty potato products and culinary products offset by decreased seafood sales due to the impact of tariffs and related competitive impacts.

Food Ingredients net sales were $631 million in the first quarter of fiscal 2006, an increase of $55 million, or 9%, from the same period in the prior year.  Increased net sales reflect a favorable environment for trading and merchandising of commodities including petroleum products, natural gas, grain and fertilizer.  The company also achieved increased net sales of its specialty ingredients products due to improved performance from its flour mills, but this was partially offset by continued weakness from its dehydrated product lines.

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Part I – Financial Information

Gross Profit

(Net sales less cost of goods sold)

	Gross Profit
	Thirteen weeks ended
($ in millions) Reporting Segment	August 28, 2005		August 29, 2004		% Increase / (Decrease)
Retail Products	$	472	$	476	(1)%
Foodservice Products	135		121		12%
Food Ingredients	121		86		41%
	$	728	$	683	7%

The company’s gross profit for the first quarter of fiscal 2006 was $728 million, an increase of 7% from the same period in the prior year.  The improved gross profits were largely driven by the unusually strong results in the Food Ingredients segment, reflecting favorable market conditions in its commodity trading and merchandising operations.  Gross profits continue to be negatively impacted by increased input costs, primarily in the Retail Products and Foodservice Products segments.  Costs of implementing the company’s operational efficiency initiatives reduced gross profit for the first quarter of fiscal 2005 by $9 million.

Retail Products gross profit for the first quarter of fiscal 2006 was $472 million, a decrease of $4 million, or 1%, from the same period in the prior year.  The profit margin trends for packaged meats operations have improved from the trends experienced during the second half of fiscal 2005, but gross profit for branded processed meats was below prior year results for the first quarter of fiscal 2006.  Gross profits throughout the Retail Products segment were negatively impacted by inflation of raw materials and packaging and higher transportation costs, largely offset by increased pricing.  Costs of implementing the company’s operational efficiency initiatives reduced gross profit for the first quarter of fiscal 2005 by $7 million.

Foodservice Products gross profit was $135 million for the first quarter of fiscal 2006 and $121 million in the same period of the prior year, an increase of 12%.  Gross profit was negatively impacted in the first quarter of fiscal 2005 by $11 million of unfavorable production costs associated with a planned plant consolidation and $2 million of costs of implementing the company’s operational efficiency initiatives.

Food Ingredients gross profit for the first quarter of fiscal 2006 increased $35 million, or 41%, to $121 million.  Improvements in gross profit are due to favorable market conditions in the company’s commodity trading and merchandising operations, reflective of very favorable market conditions, primarily in crude oil and natural gas markets, and to a lesser extent to improved performance from the company’s flour milling operations.  The company does not expect to consistently achieve this level of gross profits in its trading and merchandising operations in future periods.

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Part I – Financial Information

	Gross Margin Percent
	Thirteen weeks ended
Reporting Segment	August 28, 2005		August 29, 2004
Retail Products	24	%	24	%
Foodservice Products	17	%	15	%
Food Ingredients	19	%	15	%
Total	22	%	20	%

The company’s gross margin (gross profit as a percentage of net sales) for the first quarter of fiscal 2006 was 22%, as compared to 20% for the same period in the prior year, primarily reflecting the impact of the high margins realized in the Food Ingredients segment resulting from strong performance in the trading and merchandising operations.

Selling, General and Administrative Expenses (includes general corporate expense)

Selling, general and administrative expenses totaled $434 million for the first quarter of fiscal 2006, an increase of $24 million, or 6%, as compared to the same period in the prior year. The increase is primarily attributable to increased incentive costs due to favorable performance in the Food Ingredients segment, increased income tax-related professional fees, and certain costs related to the closure of a Retail Products segment production facility.

Operating Profit (Earnings before general corporate expense, interest expense, net, gain on the sale of Pilgrim’s Pride Corporation common stock, income taxes and equity method investment earnings)

	Operating Profit
	Thirteen weeks ended
($ in millions) Reporting Segment	August 28, 2005		August 29, 2004		% Increase / (Decrease)
Retail Products	$	211	$	210	—%
Foodservice Products	80		66		20%
Food Ingredients	76		60		27%

Retail Products operating profit for the first quarter of fiscal 2006 was $211 million, essentially unchanged from the same period in the prior year, reflective of the slightly reduced gross profit for the reasons cited in the Gross Profit discussion, above.

For the first quarter of fiscal 2006, Foodservice Products operating profit was $80 million, compared with $66 million for the first quarter of the prior fiscal year.  Operating profit is reflective of increased gross profits, largely due to fiscal 2005 costs, including the $11 million of unfavorable production costs associated with a planned plant consolidation and $5 million of costs of implementing the company’s operational efficiency initiatives, which were not incurred in the first quarter of fiscal 2006.

Food Ingredients operating profit for the first quarter of fiscal 2006 was $76 million, an increase of $16 million, or 27%, over the same period in the prior year.  Improved results are due to a favorable environment in the company’s commodity trading and merchandising operations, the operating profit of

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which increased $19 million to $47 million for the first quarter of fiscal 2006 over the same period in the prior year.

Interest Expense, Net

Net interest expense for the first quarter of fiscal 2006 decreased $5 million, or 7%, as compared to the same period in fiscal 2005.  Decreased interest expense reflects the company’s reduction of $1.2 billion of long-term debt over the last twelve months, partially offset by a reduced benefit from the interest rate swap agreements terminated in the second quarter of fiscal 2004.  During fiscal 2004, the company closed out all of its interest rate swap agreements in order to lock-in existing favorable interest rates.  These interest rate swap agreements were previously put in place as a strategy to hedge interest costs associated with long-term debt.  For financial statement purposes the benefit associated with the termination of the interest rate swap agreements continues to be recognized over the term of the debt instruments originally hedged.  The company’s net interest expense was reduced by $4 million due to the interest rate swap agreements in the first quarter of fiscal 2006 and by $14 million in the comparable period of fiscal 2005.

Gain on Sale of Pilgrim’s Pride Corporation Common Stock

During the first quarter of fiscal 2006, the company sold its remaining 15.4 million shares of Pilgrim’s Pride Corporation common stock for $482 million, resulting in a pre-tax gain of $329 million.

Income Taxes

In the first quarter of fiscal 2006 and 2005, the company’s income tax expense was $193.6 million and $81.0 million, respectively.  The effective tax rate (calculated as the ratio of income tax expense to pre-tax income from continuing operations, inclusive of equity method investment earnings) was approximately 36% for the first quarter of fiscal 2006 and 38% for the first quarter of fiscal 2005.  The company’s effective tax rate was lower in the first quarter of fiscal 2006 than in the first quarter of fiscal 2005 due to the impact of foreign taxes and related tax credits, increased research and development tax credits, the benefit from the new domestic manufacturing deduction, and a lower effective state income tax rate.

Equity Method Investment Earnings (Loss)

Equity method investment losses for the first quarter of fiscal 2006 were $14 million.  During the first quarter of fiscal 2006, the company determined that the carrying value of its investments in two unrelated joint ventures were other than temporarily impaired and therefore recognized pre-tax impairment charges totaling $19 million ($17 million after tax).  The extent of the impairments was determined based upon the company’s assessment of the recoverability of its investments based primarily upon the expected proceeds of planned dispositions of the investments.  Equity method investment earnings were $14 million in the first quarter of fiscal 2005, which included $7 million of earnings from the company’s equity interest in Swift Foods, an investment which was divested in the second quarter of fiscal 2005.

Discontinued Operations

The first quarter of fiscal 2006 includes after tax income of $5 million from discontinued operations as compared to income of $2 million in the same period of the prior year.

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Earnings Per Share

The company’s fiscal 2006 first quarter diluted earnings per share were $0.68, which includes $0.40 per diluted share gain from the sale of Pilgrim’s Pride Corporation common stock and $0.01 per diluted share of earnings from discontinued operations, as compared to first quarter fiscal 2005 diluted earnings per share of $0.26.

Liquidity and Capital Resources

Sources of Liquidity and Capital

The company’s primary financing objective is to maintain a prudent capital structure that provides the flexibility to pursue its growth objectives.  The company currently uses short-term debt to finance increases in its trade working capital (accounts receivable plus inventory, less accounts payable, accrued expenses and advances on sales) needs and a combination of equity and long-term debt to finance both its base trade working capital needs and its noncurrent assets.

Commercial paper borrowings (usually less than 30 days maturity) are reflected in the company’s consolidated balance sheets within notes payable.  The company maintains a $1.05 billion revolving credit line as a backup to the company’s commercial paper program.  The company has never used the revolving credit facility.  The company is in compliance with the credit agreements’ financial covenants.  Management believes the company will maintain its current commercial paper credit rating for the foreseeable future, thus allowing the company’s continued issuance of commercial paper.  If the company were unable to access the short-term commercial paper market, the company could use its bank revolving credit facility to provide liquidity.

The company’s $1.05 billion revolving credit facility (expiring in May 2007) is with major domestic and international banks.  The interest rate for the revolving credit facilities are generally .30 to .35 percentage points higher than the interest rates for commercial paper.

The company’s overall level of interest-bearing debt as of the end of the first quarter of fiscal year 2006 totaled $4.5 billion, compared to $5.7 billion as of the end of the first quarter of fiscal 2005.  As of the end of the first quarter of fiscal 2006, the company’s senior long-term debt ratings were BBB+ (Fitch), Baa1 (Moody’s) and BBB+ (Standard & Poor’s), all investment grade ratings.

In the first quarter of fiscal 2006, the company sold its remaining 15.4 million shares of Pilgrim’s Pride Corporation common stock to that company for $482 million.  The company recognized a pre-tax gain of approximately $329 million.

The company continues to evaluate opportunities to sell its $150 million subordinated notes receivable plus accrued interest of $39 million from the fresh beef and pork divestiture (which are reflected at a combined current fair value of $149 million in the company’s balance sheet at August 28, 2005).

Cash Flows

During the first quarter of fiscal 2006, the company generated $294 million of cash, which was the net impact of $5 million generated by operating activities, $430 million generated by investing activities, and $141 million used in financing activities.

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Cash used in operating activities of continuing operations totaled $5 million in the first quarter of fiscal 2006, as compared to $152 million generated in the same period of the prior year.  The decreased cash flow was largely the result of an increase in inventory balances due to higher commodity input prices and increased production of certain products and an increase in derivative assets included in prepaid expenses and other current assets.  Cash generated from operating activities of discontinued operations was approximately $10 million in the first quarter of fiscal 2006, as compared to $4 million in the first quarter of fiscal 2005.  Cash flow from operating activities is one of the company’s primary sources of liquidity.

Cash provided by investing activities totaled $430 million in the first quarter of fiscal 2006, versus cash used in investing activities of $65 million in the same period of fiscal 2005.  Investing activities for the first quarter of fiscal 2006 consisted primarily of proceeds of $482 million from the sale of 15.4 million shares of Pilgrim’s Pride Corporation common stock, and proceeds from the sale of the company’s discontinued specialty meats foodservice business in Illinois of $14 million, offset by capital expenditures of $71 million.  Investing activities for the first quarter of fiscal 2005 consisted primarily of capital additions, partially offset by proceeds collected from the sale of the discontinued UAP North America operations.

Cash used in financing activities totaled $141 million in the first quarter of fiscal 2006, and $329 million in the first quarter of fiscal 2005.  During the first quarter of fiscal 2006 and 2005, the company paid dividends of $141 million and $135 million, respectively.  Additionally, in the first quarter of fiscal 2005, the company repurchased $181 million of its common stock as part of its share repurchase program.

The company estimates its capital expenditures in fiscal 2006 will be approximately $400 million.  Management believes that existing cash balances, cash flows from operations, existing credit facilities and access to capital markets will provide sufficient liquidity to meet its working capital needs, planned capital expenditures, amortizing debt payments and payment of quarterly dividends.

Off-Balance Sheet Arrangements

The company uses off-balance sheet arrangements (e.g., operating leases) where the economics and sound business principles warrant their use. The company periodically enters into guarantees and other similar arrangements as part of transactions in the ordinary course of business. These are described further in “Obligations and Commitments,” below.

As a result of adopting FIN 46R, the company has consolidated the assets and liabilities of several entities from which it leases property, plant and equipment.  The company also deconsolidated ConAgra Capital, L.C., an indirectly controlled subsidiary of the company, resulting in the removal of the preferred securities of subsidiary company of $175 million and addition of $221 million of long-term debt and $46 million in other assets in the company’s balance sheets as of August 29, 2004.  The company redeemed the preferred securities of ConAgra Capital, L.C. in December 2004.  Due to the adoption of FIN 46R, the company reflects in its balance sheet as of August 28, 2005:  property, plant and equipment of $211 million, long-term debt of $221 million (including current maturities of $8 million), other assets of $12 million, and other noncurrent liabilities of $6 million.  The company has no other material obligations arising out of variable interests with unconsolidated entities.

Obligations and Commitments

As part of its ongoing operations, the company enters into arrangements that obligate the company to make future payments under contracts such as lease agreements, debt agreements and unconditional purchase

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obligations (i.e., obligations to transfer funds in the future for fixed or minimum quantities of goods or services at fixed or minimum prices, such as “take-or-pay” contracts).  The unconditional purchase obligation arrangements are entered into by the company in its normal course of business in order to ensure adequate levels of sourced product are available to the company.  Of these items, capital lease and debt obligations, which total $4.5 billion, are currently recognized as liabilities in the company’s consolidated balance sheet.  Operating lease obligations and unconditional purchase obligations, which total $994 million, are not recognized as liabilities in the company’s consolidated balance sheet in accordance with generally accepted accounting principles.

A summary of the company’s contractual obligations as of August 28, 2005 is as follows (including obligations of discontinued operations):

	Payments Due by Period
(in millions) Contractual Obligations	Total		Less than 1 Year		2-3 Years		4-5 Years		After 5 Years
Long-term debt	$	4,511.1	$	119.1	$	542.2	$	56.1	$	3,793.7
Lease obligations	729.9		101.9		196.7		128.1		303.2
Purchase obligations	264.1		74.2		125.0		36.4		28.5
Total	$	5,505.1	$	295.2	$	863.9	$	220.6	$	4,125.4

The company is also contractually obligated to pay interest on its long-term debt obligations.  The weighted average interest rate of the long-term debt obligations outstanding as of August 28, 2005 was approximately 7.4%.  As part of its ongoing operations, the company also enters into arrangements that obligate the company to make future cash payments only upon the occurrence of a future event (e.g., guarantees of debt or lease payments of a third party should the third party be unable to perform).  The following commercial commitments are not recognized as liabilities in the company’s consolidated balance sheet.  A summary of the company’s commitments, including commitments associated with the divested fresh beef and pork operations, as of August 28, 2005, is as follows:

(in millions)	Amount of Commitment Expiration Per Period
Other Commercial Commitments	Total		Less than 1 Year		2-3 Years		4-5 Years		After 5 Years
Guarantees	$	56.2	$	8.0	$	21.2	$	9.3	$	17.7
Other commitments	7.9		7.6		0.3		—		—
Total	$	64.1	$	15.6	$	21.5	$	9.3	$	17.7

The company’s total commitments of $64 million include approximately $37 million in guarantees and other commitments the company has made on behalf of the divested fresh beef and pork business.

The company has assigned a hog purchase contract to the divested fresh beef and pork business which has indemnified the company for all liabilities under the contract.  The company has, however, guaranteed the performance of the divested fresh beef and pork business with respect to the hog purchase contract.  The hog purchase contract requires the divested fresh beef and pork business to purchase a minimum of approximately 1.2 million hogs annually through 2014.  The contract stipulates minimum price commitments, based in part on market prices and in certain circumstances also includes price adjustments based on certain inputs.

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Trading Activities

The company accounts for certain contracts (e.g., “physical” commodity purchase/sale contracts and derivative contracts) at fair value.  The company considers a portion of these contracts to be its “trading” activities; specifically, those contracts that do not qualify for hedge accounting under SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities, and its related amendment, SFAS No. 138, Accounting for Certain Derivative Instruments and Certain Hedging Activities (collectively “SFAS No. 133”).

The following table represents the fair value and scheduled maturity dates of such contracts outstanding as of August 28, 2005:

	Fair Value of Contracts as of August 28, 2005 net asset / (liability)
Source of Fair Value	Maturity less than 1 year		Maturity 1-3 years		Total Fair Value
Prices actively quoted	$	211.2	$	18.2	$	229.4
Prices provided by other external sources	3.9		—		3.9
Prices based on other valuation models	—		—		—
	—		—		—
Total fair value	$	215.1	$	18.2	$	233.3

In order to minimize the risk of loss associated with non-exchange-traded transactions with counterparties, the company utilizes established credit limits and performs ongoing counterparty credit evaluations.

The above table excludes commodity-based contracts entered into in the normal course of business, including “physical” contracts to buy or sell commodities at agreed-upon fixed prices, as well as derivative contracts (e.g., futures and options) used primarily to hedge an existing asset or liability (e.g., inventory) or an anticipated transaction (e.g., purchase of inventory).  The use of such contracts is not considered by the company to be “trading” activities as these contracts are considered either normal purchase and sale contracts or hedging contracts.  The “prices actively quoted” category reflects only contracts for which the fair value is based entirely upon prices actively quoted on major exchanges in the United States. The “prices provided by other external sources” category represents contracts which

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contain a pricing component other than prices actively quoted on a major exchange, such as forward commodity positions at locations for which over-the-counter broker quotes are available.

Critical Accounting Estimates

A discussion of the company’s critical accounting estimates is in the “Management’s Discussion & Analysis” section of the company’s fiscal 2005 annual report on Form 10-K.  There have been no significant changes with respect to these policies during the first quarter of fiscal 2006.

Recently Issued Accounting Pronouncements

In December 2004, the FASB issued Statement No. 123 (revised 2004) (“SFAS No. 123R”), Share-Based Payment. SFAS No. 123R will require the company to measure the cost of all employee stock-based compensation awards based on the grant date fair value of those awards and to record that cost as compensation expense over the period during which the employee is required to perform service in exchange for the award (generally over the vesting period of the award).  Accordingly, the adoption of SFAS No. 123R will have an impact on the company’s results of operations, although it will have no impact on the company’s overall financial position.  SFAS No. 123R is effective beginning in the company’s first quarter of fiscal 2007. Management is currently evaluating the impact that the adoption of this statement will have on the company’s consolidated results of operations and cash flows.

In November 2004, the FASB issued SFAS No. 151, Inventory Costs, an amendment of ARB No. 43, Chapter 4.  SFAS No. 151 amends the guidance in ARB No. 43, Inventory Pricing, for abnormal amounts of idle facility expense, freight, handling costs, and wasted material (spoilage), requiring that those items be recognized as current-period expenses.  This statement also requires that allocation of fixed production overheads to the costs of conversion be based on the normal capacity of the production facilities.  The statement is effective for inventory costs incurred beginning in the company’s fiscal 2007.  Management is currently evaluating the impact that the adoption of this statement will have on the company’s consolidated financial position and results of operations.

In December 2004, the FASB issued SFAS No. 153, Exchanges of Nonmonetary Assets, an amendment of APB Opinion No. 29.  APB Opinion No. 29, Accounting for Nonmonetary Transactions, is based on the principle that exchanges of nonmonetary assets should be measured based on the fair value of the assets exchanged.  SFAS No. 153 amends APB Opinion No. 29, eliminating the exception to fair value accounting for nonmonetary exchanges of similar productive assets, and replaces it with a general exception to fair value accounting for nonmonetary exchanges that do not have commercial substance.  A nonmonetary exchange has commercial substance if the future cash flows of the entity are expected to change significantly as a result of the exchange.  The statement is effective for nonmonetary asset exchanges occurring in fiscal periods beginning after June 15, 2005.  Management does not expect this statement to have a material impact on the company’s consolidated financial position or results of operations.

Related Party Transactions

A discussion of the company’s related party transactions is in the “Management’s Discussion & Analysis” section of the company’s fiscal 2005 annual report on Form 10-K.

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Item 3.  Quantitative and Qualitative Disclosure About Market Risk

The principal market risks affecting the company are exposures to price fluctuations of commodity and energy inputs, interest rates and foreign currencies.  These fluctuations impact the trading business, which includes the commodity trading and merchandising functions and the processing businesses, which represent the remaining businesses of the company.

Other than the changes noted below, there have been no material changes in the company’s market risk during the thirteen weeks ended August 28, 2005.  For additional information, refer to the subsection “Quantitative and Qualitative Disclosures About Market Risk” in the “Management’s Discussion & Analysis” in Item 7A of the fiscal 2005 annual report on Form 10-K.

Commodity Market Risk

The company purchases commodity inputs such as wheat, corn, oats, soybean meal, soybean oil, petroleum products, natural gas and packaging materials to be used in its operations.  These commodities are subject to price fluctuations that may create price risk.  The company enters into commodity hedges to manage this price risk using physical forward contracts or derivative instruments.  ConAgra Foods has policies governing the hedging instruments its businesses may use.  These policies include limiting the dollar risk exposure for each of its businesses.  The company also monitors the amount of associated counter-party credit risk for all non-exchange-traded transactions.  In addition, the company purchases and sells certain commodities such as wheat, corn, cattle, hogs, soybeans, soybean meal, soybean oil, oats, petroleum products and natural gas in its trading operations.  The company’s trading activities are limited in terms of maximum dollar exposure and monitored to ensure compliance.

One measure of market risk exposure can be determined using sensitivity analysis.  Sensitivity analysis is the measurement of potential loss of fair value of a derivative instrument resulting from a hypothetical change of 10% in market prices.  Actual changes in market prices may differ from hypothetical changes.  In reality, as markets move, the company actively manages its risk and adjusts hedging strategies as appropriate.  This sensitivity analysis excludes the underlying commodity positions that are being hedged which have a high inverse correlation to price changes of the derivative commodity instrument.

Fair value was determined using quoted market prices and was based on the company’s net derivative position by commodity.

For the first quarter of fiscal 2006, the maximum potential loss of fair value resulting from a hypothetical change of 10% in market prices was $30 million based on the company’s net grains/foods derivative positions (exclusive of the underlying commodity positions being hedged) at quarter end.  For the first quarter of fiscal 2006, the maximum potential loss of fair value resulting from a hypothetical change of 10% in market prices in the company’s net energy derivative positions was $59 million at quarter end.  The highest potential loss of fair value resulting from a hypothetical change of 10% in market prices was $39 million for the company’s net grains/foods derivative positions and $41 million for the company’s net energy derivative positions outstanding at the end of any quarter of fiscal 2005.

Foreign Currency Risk

In order to reduce exposures related to changes in foreign currency exchange rates, the company may enter into forward exchange or option contracts for transactions denominated in a currency other than the functional currency for certain of its processing and trading operations.  This activity primarily relates to

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hedging against foreign currency risk in purchasing inventory, capital equipment, sales of finished goods and future settlement of foreign denominated assets and liabilities.

One measure of market risk exposure can be determined using sensitivity analysis.  Sensitivity analysis is the measurement of potential loss of fair value resulting from a hypothetical change of 10% in exchange rates.  Actual changes in exchange rates may differ from hypothetical changes.  This sensitivity analysis excludes the underlying foreign denominated transactions that are being hedged which have a high inverse correlation to price changes of the derivative commodity instrument.

Fair value was determined using quoted exchange rates and was based on the company’s net foreign currency position.  For the first quarter of fiscal 2006, the maximum potential loss of fair value resulting from a hypothetical change of 10% in exchange rates was approximately $17.8 million for processing operations based on the company’s net foreign currency derivative positions at quarter end.  For the fiscal year ended May 29, 2005, the highest, lowest and average potential loss of fair value resulting from a hypothetical change of 10% in exchange rates was approximately $24.3 million, $16.8 million and $20.1 million for processing operations based on the company’s net foreign currency derivative positions at each quarter end during fiscal 2005.

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Item 4.  Controls and Procedures

Disclosure Controls and Procedures

The company’s management, with the participation of the company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the company’s disclosure controls and procedures pursuant to Rule 13a-15(b) of the Exchange Act as of August 28, 2005. Based on that evaluation, the company’s Chief Executive Officer and Chief Financial Officer have concluded that, because of the material weakness in internal control discussed below, the company’s disclosure controls and procedures were not effective as of August 28, 2005.

During fiscal 2005, the company systematically conducted reviews of financial controls as part of its Sarbanes-Oxley 404 certification process and in connection with pending tax audits, as well as part of operational improvement efforts by new financial management.  During the third and fourth quarters, those reviews resulted in the discovery of errors related to accounting for income taxes in previously reported amounts.  To correct the errors discovered as a part of that process, and as announced in its Form 8-K filed with the SEC on March 24, 2005, the company restated financial statements for the periods covered in its Form 10-K for the fiscal year ended May 30, 2004 and the Forms 10-Q for the first two quarters of fiscal 2005.  In connection with those restatements, the company concluded that a material weakness in internal control over accounting for income taxes existed as of February 27, 2005, and was not remediated as of May 29, 2005.  A material weakness in internal control is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the financial statements would not be prevented or detected on a timely basis by the company.

In connection with the company’s overall assessment of its internal control over financial reporting, the company has evaluated the effectiveness of its internal control over accounting for income taxes as of August 28, 2005, and has concluded that the material weakness in internal controls with respect to accounting for income taxes was not remediated as of August 28, 2005.  Management’s conclusion that the material weakness in accounting for income taxes existed as of August 28, 2005 was based on the following three factors:  (1) inadequate levels of staffing and technical expertise within the company’s tax department, (2) insufficient or ineffective tax-related review and approval practices, and (3) inadequate processes to establish and effectively reconcile income tax accounts.  These deficiencies, in the aggregate, were determined to be a material weakness.

Changes in Internal Control over Financial Reporting and Remediation Plans

Progress has been made in implementing management’s remediation plans including reorganization of the tax department, hiring of a new Vice President of Tax and other tax and tax accounting professionals, design of enhanced control processes over accounting for income taxes, implementation of certain enhanced control processes over accounting for income taxes, including general ledger account reconciliation processes, implementation of dual review procedures, and engagement of third party tax specialists to provide additional quality assurance.

In connection with the company’s overall assessment of its internal control over financial reporting, the company has evaluated the effectiveness of its internal control over accounting for income taxes as of August 28, 2005, and has concluded that, while progress has been made in implementing management’s remediation plans, the material weakness in internal controls with respect to accounting for income taxes was not remediated as of August 28, 2005.  The company’s management believes that further additions to its tax staff are necessary and further enhancements and refinements to its processes are necessary in order to remediate the material weakness.  The company will continue implementing management’s

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remediation plans and will monitor the improvements in the controls over accounting for income taxes to ensure remediation of the material weakness.

During the first quarter of fiscal 2006, the company implemented process and information systems enhancements related to the management of its trade promotion activities in the Retail Products segment.  The process and systems enhancements have resulted in common trade management processes and controls across substantially all of the company’s domestic retail operations and are supported by an integrated, web-based software solution for planning and managing trade spending and customer-specific trade promotions.  These process and information systems enhancements have resulted in modifications to the internal controls over the sales, customer service and trade planning/spending processes.  Aside from such change, and changes related to the material weakness described above, there have been no significant changes during the company’s fiscal quarter ended August 28, 2005 in the company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting.

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Part II – Other Information

Item 1.  Legal Proceedings

The company has reported certain information regarding legal proceedings in its Form 10-K for the fiscal year ended May 29, 2005.

The company previously reported preliminary court approval of the settlement of derivative actions filed by three shareholder plaintiffs, purportedly on behalf of the company, following the company’s June 2001 restatement of its financial statements.  The company’s agreement to settle the lawsuit for the cost of plaintiff’s attorney fees of $0.3 million, which will be covered by insurance, received final court approval on September 8, 2005.  The settlement includes certain undertakings and is without admission of liability or wrongdoing.

The company previously reported class actions filed on July 18, 2005, in United States District Court for Nebraska.  On August 8, 2005 another class action, Boyd v. ConAgra Foods, Inc. et. al., Case No. 805CV386,  was filed in the same court.  The lawsuits are against the company and its directors and its employee benefits committee on behalf of participants in the company’s employee retirement income savings plans. The lawsuits allege violations of the Employee Retirement Income Security Act (ERISA) in connection with the events resulting in the company’s April 2005 restatement of its financial statements and related matters. Each complaint seeks unspecified amount of damages, injunctive relief, attorneys’ fees and other equitable monetary relief.  The company believes the lawsuits are without merit and intends to vigorously defend the actions.

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Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds

The following table presents the total number of shares purchased during the first quarter of fiscal 2006, the average price paid per share, the number of shares that were purchased as part of a publicly announced repurchase program, and the approximate dollar value of the maximum number of shares that may yet be purchased under the share repurchase program:

Period	Total Number of Shares Purchased (1)	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Program (2)	Approximate Dollar Value of Shares that may yet be Purchased under the Program (2)
May 30 through June 26, 2005	3,145	$	26.40	—	$	399,900,000
June 27 through July 24, 2005	29,259	$	22.98	—	$	399,900,000
July 25 through August 28, 2005	22,061	$	22.39	—	$	399,900,000
Total Fiscal 2006 First Quarter Activity	54,465	$	22.94	—	$	399,900,000

⁽¹⁾  Amounts represent shares delivered to the company to pay the exercise price under stock options or to satisfy tax withholding obligations upon the exercise of stock options or vesting of restricted shares.

⁽²⁾  Pursuant to the share repurchase plan announced on December 4, 2003 of up to $1 billion.  The company has repurchased 22.1 million shares at a cost of $600 million through August 28, 2005.  This program has no expiration date.

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Item 4.  Submission of Matters to a Vote of Security Holders

The company’s annual meeting of stockholders was held on September 22, 2005.  The vote for each matter voted upon at the meeting is set forth below:

Election of Directors

	FOR	WITHHELD
Howard G. Buffett	435,423,586	8,427,592
John T. Chain, Jr.	434,800,641	9,050,537
Ronald W. Roskens	431,339,730	12,511,448
Kenneth E. Stinson	353,444,589	90,406,589

Amendment of Article VII(a) of the Certificate of Incorporation to declassify the Board of Directors:

FOR:	432,218,997
AGAINST:	7,657,575
ABSTAIN:	3,974,305

Amendment to the Certificate of Incorporation to repeal Article XIV:

FOR:	431,974,801
AGAINST:	7,336,425
ABSTAIN:	4,539,649

Amendment to the Certificate of Incorporation to repeal Article XV:

FOR:	432,353,779
AGAINST:	7,047,690
ABSTAIN:	4,449,407

Ratification of the appointment of KPMG as independent auditors for fiscal year 2006:

FOR:	350,586,398
AGAINST:	89,764,266
ABSTAIN:	3,498,811

Stockholder proposal regarding animal welfare:

FOR:	19,641,352
AGAINST:	280,131,799
ABSTAIN:	47,690,717
BROKER NON-VOTE:	96,387,310

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Stockholder proposal regarding genetically engineered products:

FOR:	17,007,394
AGAINST:	285,541,562
ABSTAIN:	44,914,612
BROKER NON-VOTE:	96,387,610

Stockholder proposal regarding suspension of stock grants for directors and senior executive officers:

FOR:	20,980,918
AGAINST:	320,888,557
ABSTAIN:	5,593,843
BROKER NON-VOTE:	96,387,860

39

ConAgra Foods, Inc. and Subsidiaries

Part II – Other Information

Item 6.  Exhibits

(A)	Exhibits
	3.1	ConAgra Foods Certificate of Incorporation, as amended
	3.2	ConAgra Foods Bylaws, as amended
	12	Statement regarding computation of ratio of earnings to fixed charges
	31.1	Section 302 Certificate of Chief Executive Officer
	31.2	Section 302 Certificate of Chief Financial Officer
	32.1	Section 906 Certificates

40

ConAgra Foods, Inc. and Subsidiaries

Part II – Other Information

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 thereunto duly authorized.

CONAGRA FOODS, INC.

By:

/s/ Frank S. Sklarsky

Frank S. Sklarsky

Executive Vice President, Chief
Financial Officer

By:

/s/ John F. Gehring

John F. Gehring

Senior Vice President and Corporate Controller

Dated this 7th day of October, 2005.

41

ConAgra Foods, Inc. and Subsidiaries

Exhibit Index

EXHIBIT	DESCRIPTION	PAGE
3.1	ConAgra Foods Certificate of Incorporation, as amended	43
3.2	ConAgra Foods Bylaws, as amended	55
12	Statement regarding computation of ratio of earnings to fixed charges	69
31.1	Section 302 Certificate of Chief Executive Officer	70
31.2	Section 302 Certificate of Chief Financial Officer	71
32.1	Section 906 Certificates	72

42

EX-3.1

Exhibit 3.1

(CONFORMED TO REFLECT ALL PRIOR AMENDMENTS)

CERTIFICATE OF INCORPORATION

OF

CONAGRA FOODS, INC.

ARTICLE I

NAME

The name of the Corporation shall be ConAgra Foods, Inc.

ARTICLE II

REGISTERED OFFICE AND

REGISTERED AGENT

The street address of the registered office of the Corporation is 32 Loockerman Square, Suite L-100, Dover, Delaware, 19901, County of Kent.  The name of its registered agent at such address is The Prentice-Hall Corporation System, Inc.

ARTICLE III

PURPOSES

The general nature of the business and the objects and purposes proposed to be transacted, promoted and carried on by the Corporation are to do any and all of the things herein mentioned as fully and to the same extent as natural persons might or could do and in any part of the world, including:

(a)To manufacture, purchase, acquire, prepare, produce, own, hold, store, process, prepare for market, preserve, package, deal in, trade in, sell, distribute, mortgage, pledge and dispose of flour, feed grain, agricultural products, articles manufactured from agricultural products, and any articles, materials, ingredients, goods, wares, merchandise, products, machinery, equipment and property related or incidental thereto or useful, necessary or convenient in connection therewith.

(b)To operate factories, warehouses, elevators, and other buildings for manufacturing, buying, selling, handling, and storing flour, feed grain, agricultural products and articles manufactured from agricultural products, to conduct a public warehouse business, and to engage in, carry on, or otherwise conduct, or employ others to conduct, general research or investigation for the development of new or improved products or by-products and the use of such products or by-products as food, and for improving the ease or efficiency of the products, operations and procedures of the Corporation or for other purposes.

43

Exhibit 3.1

(c)To promote, institute, enter into, conduct, perform, assist or participate in every kind of commercial, agricultural, mercantile, manufacturing, mining or industrial enterprise, business, work, contract, undertaking, venture and operation in any part of the world and, for any such purpose, to purchase, lease and otherwise acquire, take over, hold, sell, liquidate and otherwise dispose of the real estate, crops, livestock, plants, equipment, inventory, merchandise, materials, stock, good will, rights, franchises, concessions, patents, trademarks and trade names and other properties of the corporations, associations, partnerships, firms, trustees, syndicates, ventures, combinations, organizations and other entities located in or organized under the laws of any part of the world; to continue, alter, exchange and develop their business, assume their liabilities, guarantee or become surety for the performance of their obligations, reorganize their capital and participate in any way in their affairs, and to take over, as a going concern and to continue in its own name, any business so acquired, all in accordance with and to the extent permitted by law.

(d)To borrow or raise moneys for any of the purposes of the Corporation and, from time to time, without limit as to amount, to draw, make, accept, endorse, execute, issue, and grant promissory notes, drafts, bills of exchange, warrants, options, bonds, debentures, and other negotiable or non-negotiable instruments, evidences of indebtedness and agreements; to secure the payment thereof and of the interest thereon and the performance thereof by mortgage upon, or pledge, conveyance, or assignment in trust of, the whole or any part of the assets of the Corporation, whether at the time owned or thereafter acquired; and to sell, pledge, or otherwise dispose of such securities or other obligations of the Corporation for its corporate purposes.

(e)To guarantee, purchase, hold, sell, assign, transfer, mortgage, pledge or otherwise dispose of the shares of the capital stock of, or any bonds, securities or evidences of indebtedness created by any other corporation or corporations of the State of Delaware or any other state, country, nation or government and, while the owner of said stock, to exercise all the rights, powers, and privileges of ownership, including the right to vote thereon.

(f)To pay for any property, securities, rights or interests acquired by this Corporation in cash or other property, rights or interests held by this Corporation, or by issuing and delivering in exchange therefor its own property, stock, shares, bonds, debentures, notes, warrants for stock, certificates of indebtedness or other obligations or securities howsoever evidenced.

(g)To carry on all or any part of its business objects or purposes as principal, factor, agent, contractor or otherwise, either alone or as a member of, or associated with any corporation, association, partnership, firm, trustee, syndicate, individual, combination, organization, joint venture or entity in any part of the world.

(h)In carrying on its business and for the purpose of furthering its objects and purposes, to enter into and perform agreements and contracts of any nature with any government, state, territory, district, municipality, political or governmental division or subdivision, body politic, corporation, association, partnership, firm, trustee, syndicate, individual, combination, organization or entity whatsoever.

(i)To have one or more offices, to carry on all or any of its operations and business and, without restriction or limit as to amount, to purchase or otherwise acquire, hold, own,

44

Exhibit 3.1

mortgage, sell, convey or otherwise dispose of real and personal property of every class and description in any of the States, Districts, Territories or Colonies of the United States, and in any and all foreign countries, subject to the laws of any such State, District, Territory, Colony or Country.

It is the intention that the objects and purposes specified in the foregoing clauses of this Article shall not be in any wise limited or restricted by reference to or inference from the terms of any other clause of this or any other Articles in these Articles of Incorporation, but that the objects and purposes specified in each of the clauses of this Article shall be regarded as independent objects and purposes.  It is also the intention that said clauses be constructed both as purposes and powers; and generally, that the corporation shall be authorized to exercise and enjoy all other powers, rights, and privileges granted to or conferred upon a corporation of this character by the laws of the State of Delaware, and the enumeration of certain powers as herein specified is not intended as exclusive of or as waiver of any of the powers, rights or privileges granted or conferred by the laws of said State, now or hereinafter in force.

ARTICLE IV

AUTHORIZED SHARES

The total number of shares which this corporation shall have authority to issue is One BillionTwo Hundred Eighteen Million Fifty Thousand (1,218,050,000) shares, divided into One Billion Two Hundred Million (1,200,000,000) shares of Common Stock of a par value of Five Dollars ($5.00) per share; One Hundred Fifty Thousand (150,000) shares of Class B Preferred Stock of a par value of Fifty Dollars ($50.00) per share; Two Hundred Fifty Thousand (250,000) shares of Class C Preferred Stock of a par value of One Hundred Dollars ($100.00) per share; One Million One Hundred Thousand (1,100,000) shares of Class D Preferred Stock without par value; and Sixteen Million Five Hundred Fifty Thousand (16,550,000) shares of Class E Preferred Stock without par value.

The Class B Preferred Stock of this corporation may be divided into and issued in series, and each series shall be so designated as to distinguish the shares thereof from the shares of all other series and classes.  All shares of this Class shall be identical except as to the following relative rights and preferences as to which there may be variations between different series within Class B as determined by the Board of Directors:  (a) the rate of dividend; (b) whether the shares may be redeemed and, if so, the redemption price and the terms and conditions of redemption; (c) the amount payable upon shares in event of voluntary or involuntary liquidation; (d) sinking fund provisions, if any, for the redemption or purchase of shares; and (e) the terms and conditions, if any, on which shares may be converted.

The Class C Preferred Stock of this corporation may be divided into and issued in series, and each series shall be so designated as to distinguish the shares thereof from the shares of all other series and classes.  The shares of this Class shall not have any priority over Class B Preferred Stock as to payment of dividends or as to distribution of assets upon liquidation, distribution or winding up of the corporation.  All shares of this Class shall be identical except as to the following relative rights and preferences as to which there may be variations between different series within Class C as determined by the Board of Directors:  (a) whether such shares shall be granted voting rights and, if so, to what extent and upon

45

Exhibit 3.1

what terms and conditions; (b) the rates and times at which, and the terms and conditions on which, dividends on such shares shall be paid and any dividend rights of cumulation; (c) whether such shares shall be granted conversion rights and, if so, upon what terms and conditions; (d) whether the corporation shall have the right to redeem such shares and, if so, upon what terms and conditions; (e) the liquidation rights (if any) of such shares, including whether such shares shall enjoy any liquidation preference over the common stock; and (f) such other designations, preferences, relative rights and limitations (if any) attaching to such shares.

The Class D Preferred Stock of this corporation may be divided into and issued in series, and each series shall be so designated as to distinguish the shares thereof from the shares of all other series and classes.  The shares of this Class shall not have any priority over Class B Preferred Stock or Class C Preferred Stock as to the payment of dividends or as to the distribution of assets upon liquidation, distribution or winding up of the corporation.  All shares of this Class shall be identical except as to the following relative right and preferences as to which there may be variations between different series within Class D as determined by the Board of Directors:  (a) whether such shares shall be granted voting rights and, if so, to what extent and upon what terms and conditions; (b) the rates and times at which, and the terms and conditions on which, dividends on such shares shall be paid and any dividend rights of cumulation; (c) whether such shares shall be granted conversion rights and, if so, upon what terms and conditions; (d) whether the corporation shall have the right to redeem such shares and, if so, upon what terms and conditions; (e) the liquidation rights (if any) of such shares, including whether such shares shall enjoy any liquidation preference over the common stock; and (f) such other designations, preferences, relative rights and limitations (if any) attaching to such shares.

The Class E Preferred Stock of this corporation may be divided into and issued in series, and each series shall be so designated as to distinguish the shares thereof from the shares of all other series and classes.  The shares of this Class shall not have any priority over Class B Preferred Stock, Class C Preferred Stock or Class D Preferred Stock as to the payment of dividends or as to the distribution of assets upon liquidation, distribution or winding up of the corporation.  All shares of this Class shall be identical except as to the following relative rights and preferences as to which there may be variations between different series within Class E as determined by the Board of Directors:  (a) whether such shares shall be granted voting rights and, if so, to what extent and upon what terms and conditions; (b) the rates and times at which, and the terms and conditions on which, dividends on such shares shall be paid and any dividend rights of cumulation; (c) whether such shares shall be granted conversion rights and, if so, upon what terms and conditions; (d) whether the corporation shall have the right to redeem such shares and, if so, upon what terms and conditions; (e) the liquidation rights (if any) of such shares, including whether such shares shall enjoy any liquidation preference over the common stock; and (f) such other designations, preferences, relative rights and limitations (if any) attaching to such shares.

No transfer of stock of this corporation shall be operative until entered upon the books of the corporation.

46

Exhibit 3.1

ARTICLE V

INDEMNIFICATION

The Corporation shall, to the extent required, and may, to the extent permitted, by Section 102 and Section 145 of Delaware General Corporation Law as amended from time to time, indemnify and reimburse all persons whom it may indemnify and reimburse pursuant thereto.  With respect to acts or omissions occurring on or after September 18, 1986, no director shall be liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, provided, however, that this provision shall not eliminate or limit the liability of a director (i) for any breach of the director’s duty of loyalty to the Corporation or its stockholders; (ii) for acts of omissions not in good faith or which involve intentional misconduct or a knowing violation of law; (iii) under Section 174 of the Delaware General Corporation Law; or (iv) for any transaction from which the director derived an improper personal benefit.

Notwithstanding the foregoing, the indemnification provided for in this ARTICLE V shall not be deemed exclusive of any other rights to which those entitled to receive indemnification or reimbursement hereunder may be entitled under any by-law of this Corporation, agreement, vote or consent of stockholders or disinterested directors or otherwise.

ARTICLE VI

DURATION

The Corporation shall have perpetual existence.

ARTICLE VII

POWERS

The following provisions are inserted for the management of the business and for the conduct of the affairs of the corporation, and it is expressly provided that they are intended to be in furtherance and not in limitation or exclusion of the powers conferred by the statutes of the State of Delaware.

(a)The affairs of this Corporation shall be conducted by a Board of Directors. The number of directors of the Corporation, not less than nine (9) nor more than sixteen (16), shall be fixed from time to time by the By-Laws. Until the annual election of directors by the stockholders of the Corporation in 2008, the directors of the Corporation shall be divided into three classes: Class I, Class II and Class III, each such class, as nearly as possible, to have the same number of directors. The term of office of the class of directors elected in 2003 shall expire at the annual election of directors by the stockholders of the Corporation in 2006, the term of office of the class of directors elected in 2004 shall expire at the annual election of directors by the stockholders of the Corporation in 2007, and the term of office of the class of directors elected in 2005 shall expire at the annual election of directors by the stockholders of the Corporation in 2008, or in each case thereafter when their respective successors are elected by the stockholders and qualify. At each annual election of directors by the stockholders of the Corporation held after 2005, the directors chosen to succeed those whose terms are then expired shall be elected by the stockholders of the Corporation for a term ending at the annual election of directors by the stockholders of the Corporation following the annual election of directors by the

47

Exhibit 3.1

stockholders of the Corporation at which the director was elected, or thereafter when their respective successors in each case are elected by the stockholders and qualify. Commencing with the annual election of directors by the stockholders of the Corporation in 2008, the classification of the Board of Directors shall terminate and all directors shall be of one class.

(b)The books of the Corporation may be kept within or without the State of Delaware at such place or places as may be designated from time to time by the Board of Directors.

(c)The Board of Directors may make, alter or repeal the By-Laws of the Corporation except as otherwise provided therein.

(d)The Board of Directors may authorize and cause to be executed mortgages and liens upon the real and personal property of the Corporation, may hold meetings outside the State of Delaware, may declare and pay stock dividends, and may set apart out of any funds of the Corporation available for dividends a reserve or reserves for any proper purpose or to abolish any such reserves in the manner in which it was created.

(e)In addition to the powers and authorities hereinbefore or by statute expressly conferred upon it, the Board of Directors is hereby empowered to exercise all such powers and to do all such acts and things as may be exercised or done by the Corporation; subject, nevertheless, to the provisions of the statues of Delaware, of this certificate of incorporation and of any By-Laws from time to time made by the stockholders; provided, however, that no By-Laws so made shall invalidate any prior act of the Board of Directors which would have been valid if such By-Laws had not been made.

ARTICLE VIII

MEETINGS OF STOCKHOLDERS

The time for holding meetings of Stockholders for the election of a Board of Directors and for holding any special meetings of the Stockholders shall be as provided for by the By-Laws adopted by the Board of Directors.

ARTICLE IX

AMENDMENT

The Corporation reserves the right to amend, alter, change or repeal any provision contained in these Articles of Incorporation in the manner now or hereafter prescribed by state, and all rights conferred upon Stockholders herein are granted subject to this reservation.

ARTICLE X

INTERESTED DIRECTORS

No contract or transaction between a corporation and one or more of its directors or officers, or between a corporation and any other corporation, partnership, association, or other organization in which one or more of its directors or officers are directors or officers,

48

Exhibit 3.1

or have a financial interest, shall be void or voidable solely for this reason, or solely because the director or officer is present at or participates in the meeting of the board or committee thereof which authorizes the contract or transaction, or solely because his or their votes are counted for such purpose, if:

(a)The material facts as to his relationship or interest and as to the contract or transaction are disclosed or are known to the Board of Directors or the committee, and the board or committee in good faith authorizes the contract or transaction by the affirmative vote of a majority of the disinterested directors, even though the disinterested directors be less than a quorum; or (b) The contract or transaction is fair as to the corporation as of the time it is authorized, approved or ratified, by the Board of Directors, a committee thereof, or the Shareholders.  Common or interested directors may be counted in determining the presence of a quorum at a meeting of the Board of Directors or of a committee which authorizes the contract or transaction.

ARTICLE XI

PRIVATE PROPERTY

The private property of the Stockholders shall not be subject to the payment of corporation debts to any extent whatsoever.

ARTICLE XII

INCORPORATOR

The name and address of the incorporator is Claude I. Carter 1705 North 102nd Avenue Omaha, Nebraska 68114.

49

Exhibit 3.1

ARTICLE XIII

INITIAL BOARD OF DIRECTORS

The name and mailing address of the persons who are to serve as directors until the first annual meeting of stockholders, or until their successors are elected and qualify, are as follows:  Ralph T. Birdsey, Clayton Brokerage, 400 Colony Square, Suite 1130, 1201 Peachtree Street, Atlanta, Georgia 30361; L.D. McGehee, 1302 Hodges Avenue, Ruston, Louisiana 71270; Claude I. Carter, 1705 North 102nd Street, Omaha, Nebraska 68114; Robert B. Daugherty, 400 North Elmwood Road, Omaha, Nebraska 68132; James B. Cooper, Route 3, Marshalltown, Iowa 50158; Lewis H. Durland, P.O. Box 550, Terrace Hill, Ithaca, New York 14850; Roy H. Park, Park Broadcasting, Inc., Box 550, Terrace Hill, Ithaca, New York 14850; Charles M. Harper, 6105 Lamplighter Drive, Omaha, Nebraska 68152.

50

Exhibit 3.1

ARTICLE XIV

EFFECTS OF BUSINESS COMBINATIONS

The Board of Directors of the Corporation, when evaluating any offer of another party to (a) make a tender or exchange offer for any equity security of the Corporation, (b) merge or consolidate the Corporation with another corporation, or (c) purchase or otherwise acquire all or substantially all of the properties and assets of the Corporation, shall, in connection with the exercise of its judgment in determining what is in the best interests of the Corporation and its stockholders, give due consideration to all relevant factors, including without limitation the social and economic effects on the employees, customers, suppliers and other constituents of the Corporation and its subsidiaries and on the communities in which the Corporation and its subsidiaries operate or are located.

ARTICLE XV

ANNUAL AND SPECIAL MEETING OF STOCKHOLDERS

Any action required or permitted to be taken by the holders of the capital stock of the Company must be effected at a duly called annual or special meeting of such holders and may not be effected by any consent in writing of such holders.

ARTICLE XVI

PROHIBITION OF “GREENMAIL”

A.Any purchase or other acquisition, directly or indirectly, in one or more transactions, by the Company or any Subsidiary (as hereinafter defined) of the Company of any shares of Voting Stock (as hereinafter defined) or any Voting Stock Right (as hereinafter defined) known by the Company to be beneficially owned by any Interested Stockholder (as hereinafter defined) who has purchased or otherwise acquired any such Voting Stock or Voting Stock Right within two years prior to the date of such purchase or other acquisition from the Company or Subsidiary shall, except as hereinafter expressly provided, require the affirmative vote of at least a majority of all votes entitled to be cast by the holders of the Voting Stock (excluding Voting Stock held by an Interested Stockholder) voting together as a single class.  Such affirmative vote shall be required notwithstanding the fact that no vote may be required, or that a lesser percentage may be specified, by law or any agreement with any national securities exchange, or otherwise, but no such affirmative vote shall be required with respect to any purchase or other acquisition by the Company or any of its Subsidiaries of Voting Stock or Voting Stock Rights purchased at or below Fair Market Value (as hereinafter defined) or made as part of a tender or exchange offer made on the same terms to all holders of such securities and complying with the applicable requirements of the Securities Exchange Act of 1934 (the “Exchange Act”) and the rules and regulations thereunder or in a Public Transaction (as hereinafter defined).

B.For the purposes of this Article XVI:

1.An “Affiliate” of, or a person “Affiliated” with, a specified person, is a person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the person specified.

51

Exhibit 3.1

2.The term “Associate” used to indicate a relationship with any person, means (1) any corporation or organization (other than the Company or a Subsidiary of the Company) of which such person is an officer or partner or is, directly or indirectly, the beneficial owner of 5% or more of any class of equity securities, (2) any trust or other estate in which such person has a substantial beneficial interest or as to which such person serves as trustee or in a similar fiduciary capacity, and (3) any relative or spouse of such person, or any relative of such spouse, who has the same home as such person.

3.A person shall be a “beneficial owner” of any Voting Stock or Voting Stock Right:

(a)which such person or any of its Affiliates or Associates beneficially owns, directly or indirectly; or

(b)which such person or any of its Affiliates or Associates has (i) the right to acquire (whether such right is exercisable immediately or only after the passage of time), pursuant to any agreement, arrangement or understanding or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise, or (ii) any right to vote pursuant to any agreement, arrangement or understanding; or

(c)which is beneficially owned, directly or indirectly, by any other person with which such person or any of its Affiliates or Associates has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting or disposing of any security of any class of the Company or any of its Subsidiaries.

(d)For the purposes of determining whether a person is an Interested Stockholder, the relevant class of securities outstanding shall be deemed to include all such securities of which such person is deemed to be the “beneficial owner” through application of this subparagraph 3, but shall not include any other securities of such class which may be issuable pursuant to any agreement, arrangement or understanding, or upon exercise of conversion right, warrants or options, or otherwise, but are not yet issued.

4.“Fair Market Value” means for any share of Voting Stock or any Voting Stock Right, the average of the closing sale prices during the 30-day period immediately preceding the repurchase of such Voting Stock or Voting Stock Right, as the case may be, on the Composite Tape for New York Stock Exchange-Listed Stocks, or, if such Voting Stock or Voting Stock Right, as the case may be, is not quoted on the Composite Tape, on the New York Stock Exchange, or, if such Voting Stock or Voting Stock Rights, as the case may be, is not listed on such Exchange, on the principal United States securities exchange registered under the Exchange Act on which such Voting Stock or Voting Stock Right, as the case may be, is listed, or if such Voting Stock or Voting Stock Right, as the case may be, is not listed on any such exchange, the average of the closing bid quotations with respect to a share of such Voting Stock or Voting Stock Right, as the case may be, during the 90-day period immediately preceding the date in question on the National Association of Securities Dealers, Inc.  Automated Quotations System or any system then in use, or if no such quotations are available, the Fair Market Value on the date in question of a share of such Voting Stock or Voting Stock Right, as the case may be, as determined by the Board of Directors in good faith.

52

Exhibit 3.1

5.“Interested Stockholder” shall mean any person (other than (i) the Company, (ii) any of its Subsidiaries, (iii) any benefit plan or trust of or for the benefit of the Company or any of its Subsidiaries, (iv) any trustee, agent or other representative of any of the foregoing, or (v) any person who beneficially owned more than 3% of any class of Voting Stock on July 11, 1985), who or which:

(a)is the beneficial owner, directly or indirectly, of more than 3% of any class of Voting Stock (or Voting Stock Rights with respect to more than 3% of any such class); or

(b)is an Affiliate of the Company and at any time within the two-year period immediately prior to the date in question was the beneficial owner, directly or indirectly, of more than 3% of any class of Voting Stock (or Voting Stock Rights with respect to more than 3% of any such class); or

(c)is an assignee of or has otherwise succeeded to any shares of any class of Voting Stock (or Voting Stock Rights with respect to more than 3% of any such class) which were at any time within the two-year period immediately prior to the date in question beneficially owned by an Interested Stockholder, unless such assignment or succession shall have occurred pursuant to any Public Transaction or a series of transactions including a Public Transaction.

6.A “person” shall mean any individual, firm, corporation or other entity (including a “group” within the meaning of Section 13(d) of the Exchange Act).

7.A “Public Transaction” shall mean any (i) purchase of shares offered pursuant to an effective registration statement under the Securities Act of 1933, or (ii) open market purchases of shares if, in either such case, the price and other terms of sale are not negotiated by the purchaser and seller of the beneficial interest in the shares.

8.The term “Subsidiary” shall mean any corporation at least a majority of the outstanding securities of which having ordinary voting power to elect a majority of the board of directors of such corporation (whether or not any other class of securities has or might have voting power by reason of the happening of a contingency) is at the time owned or controlled directly or indirectly by the Company or one of more Subsidiaries or by the Company and one or more Subsidiaries.

9.The term “Voting Stock” shall mean stock of all classes and series of the Company entitled to vote generally in the election of directors.

10.The term “Voting Stock Right” shall mean any security convertible into, and any warrant, option or other right of any kind to acquire beneficial ownership of, any Voting Stock, other than securities issued pursuant to any of the Company’s employee benefit plans.

C.A majority of the Board of Directors shall have the power and duty to determine for the purposes of this Article XVI, on the basis of information known to it after reasonable inquiry, all facts necessary to determine compliance with this Article XVI, including without limitation,

53

Exhibit 3.1

1.whether:

(a)a person is an Interested Stockholder;

(b)any Voting Stock and Voting Stock Right is beneficially owned by any person;

(c)a person is an Affiliate or Associate of another;

(d)a transaction is a Public Transaction; and

2.the Fair Market Value of any Voting Stock or Voting Stock Right.

D.Notwithstanding anything contained in this Certificate to the contrary, the affirmative vote of at least a majority of all votes entitled to be cast by the holders of capital stock entitled to vote generally in the election of directors, voting together as a single class, shall be required to amend or repeal this Article XVI or to adopt any provision inconsistent herewith.

54

EX-3.2

EXHIBIT 3.2

BY-LAWS

OF

CONAGRA FOODS, INC.

ARTICLE I

OFFICES

Section 1. Principal Executive Office. The principal executive office of ConAgra Foods, Inc. (ConAgra) shall be located in the City of Omaha, County of Douglas, State of Nebraska. ConAgra may have such other offices as the Board of Directors may designate or as the business of ConAgra may require from time to time.

Section 2. Principal Place of Business. The principal place of business may be, but need not be, identical with the location of the principal executive office. The resident agent of ConAgra shall be as designated from time to time by resolution of the Board of Directors.

ARTICLE II

STOCKHOLDERS

Section 1. Annual Meetings. The annual meeting of the stockholders shall be held on a date and at an hour determined by the Board of Directors for the purpose of electing officers and for the transaction of such other business as may properly come before the meeting.

Section 2. Special Meetings. Special meetings of the stockholders, for any purpose or purposes, may be called at any time by the Chairman of the Board or the Chief Executive Officer of ConAgra or by a majority of the full Board of Directors of ConAgra.

Section 3. Place of Meeting. The Board of Directors may designate Omaha, Douglas County, Nebraska, or such other place, either within or without the State of Nebraska, as the place of meeting for any annual meeting or any special meeting called by the Board of Directors.

Section 4. Notice of Meeting. Notice of a meeting of stockholders stating the place, day, and hour of the meeting and, in case of a special meeting, the purpose or purposes for which the meeting is called, shall be given not less than ten nor more than sixty days before the day of the meeting by or at the direction of the Chairman of the Board, Chairman of the Executive Committee, or the Chief Executive Officer, or the Secretary, to each stockholder of record entitled to vote at such meeting. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail, addressed to the stockholder at the address listed on the stock transfer books of ConAgra with postage prepaid. ConAgra need not send notices to stockholders for whom ConAgra has no current address, and action taken without notice to such persons has the same force and effect as if notice had been given to them. ConAgra shall be deemed to have no current shareholder address when two consecutive annual meeting notices have been returned undeliverable, or when at least two payments of dividends or interest sent by first class mail during a twelve-month period have been returned undeliverable. Only such business shall be conducted at a special meeting of stockholders as shall have been brought before the meeting pursuant to the notice of meeting. Any previously scheduled meeting of the stockholders may be postponed, and (unless the Certificate of Incorporation otherwise provides) any special meeting of the stockholders may be

55

EXHIBIT 3.2

cancelled, by resolution of the Board of Directors upon public notice given prior to the date previously scheduled for such meeting of stockholders.

Section 5. Record Date. For the purpose of determining stockholders entitled to notice of or to vote at any annual or special meeting of stockholders or any adjournment thereof, the record date shall be determined by the Board of Directors and shall be not less than ten days nor more than sixty days before the meeting. If no record date is fixed by the Board of Directors, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day next preceding the day on which notice is given, or if notice is waived, at the close of business on the day next preceding the day on which the meeting is held. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting.

Section 6. Voting Lists. The officer or agent having charge of the stock transfer ledger for shares of ConAgra shall prepare and make, at least ten days before every meeting of stockholders, a complete list of stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be opened to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten days prior to the meeting. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present. The original or duplicate stock ledger shall be the only evidence detailing stockholders who are entitled to examine such list or to vote in person or by proxy at such election.

Section 7. Quorum. A majority of the outstanding shares of ConAgra entitled to vote, represented in person or by proxy, shall constitute a quorum at a meeting of stockholders. If less than a majority of the outstanding shares are represented at a meeting, the Chairman or a majority of the shares so represented may adjourn the meeting from time to time without further notice. At such adjourned meeting at which a quorum shall be present or represented, any business may be transacted which might have been transacted at the meeting as originally notified. The stockholders present at a duly organized meeting may continue to transact business until adjournment, notwithstanding the withdrawal of enough stockholders to leave less than a quorum.

Section 8. Proxies; Voting. At all meetings of stockholders, a stockholder may vote by proxy. Such proxy shall be filed with the Secretary of ConAgra at or prior to the time of such meeting. Unless otherwise provided in the proxy, it shall be valid from the date of its execution until three years after its date of execution. At all meetings of stockholders for the election of directors a plurality of the votes cast shall be sufficient to elect the directors. All other elections and questions shall, unless otherwise provided by the Certificate of Incorporation, these By-Laws, the rules or regulations of any stock exchange applicable to ConAgra, as otherwise provided by law or pursuant to any regulation applicable to ConAgra or its securities, be decided by the affirmative vote of the holders of a majority of the shares of stock of ConAgra which are present in person or by proxy and entitled to vote thereon.

Section 9. Voting of Shares by Certain Holders. Shares standing in the name of another corporation may be voted by such officer, agent, or proxy as the By-Laws of such corporation may prescribe, or, in the absence of such provision, as the Board of Directors of such corporation may determine.

Shares held by an administrator, executor, guardian, conservator, or other fiduciary may be voted by such person, either in person or by proxy, without a transfer of such shares into the name of such person. Shares standing in the name of a trustee may be voted by such trustee, either in person or by proxy, but no trustee shall be entitled to vote such shares held without a transfer of such shares into his name, as trustee.

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Shares standing in the name of a receiver may be voted by such receiver, and shares held by or under the control of a receiver may be voted by such receiver without the transfer thereof into his name if authority to do so is contained in an appropriate order of the court.

Persons whose stock is pledged shall be entitled to vote, unless the pledgor has effected the transfer on the books of ConAgra and has expressly empowered the pledgee to vote thereon, in which case only the pledgee or his proxy, may represent such stock and vote thereon.

Shares of its own stock belonging to ConAgra shall not be voted, directly or indirectly, at any meeting, and shall not be counted in determining the total number of outstanding shares at any given time. Nothing herein shall be construed as limiting the right of ConAgra to vote stock, including but not limited to its own stock, held by it in a fiduciary capacity.

Section 10. Notice of Stockholder Business. At an annual meeting of the stockholders, only such business shall be conducted as shall have been brought before the meeting (a) by or at the direction of the Board of Directors or (b) by any stockholder of ConAgra who was a stockholder of record at the time of giving of notice provided for in Section 4, who is entitled to vote at the meeting and who complies with the notice procedures set forth in this Section 10. For business to be properly brought before an annual meeting by a stockholder, a stockholder must have given timely notice thereof in writing to the Secretary of ConAgra and such business must otherwise be a proper matter for stockholder action. To be timely, a stockholder’s notice must be delivered to or mailed and received at the principal executive offices of ConAgra, not less than 90 nor more than 120 days prior to the first anniversary of the preceding year’s annual meeting; provided, however, that in the event the date of the annual meeting is advanced by more than 30 days, or delayed by more than 60 days, from such anniversary date, notice by the stockholder to be timely must be so delivered or mailed and received not earlier than the 120th day prior to such annual meeting and not later than the close of business on the later of the 90th day prior to such annual meeting or the tenth day following the date on which public announcement of the date of such meeting is first made. In no event shall the public announcement of an adjournment or postponement of an annual meeting commence a new time period (or extend any time period) for the giving of a stockholder’s notice as described above. A stockholder’s notice to the Secretary shall set forth as to each matter the stockholder proposes to bring before the annual meeting (a) a description of the business desired to be brought before the annual meeting, the text of the proposal or business (including the text of any resolutions proposed for consideration and in the event that such business includes a proposal to amend the By-Laws of ConAgra, the language of the proposed amendment), and the reasons for conducting such business at the annual meeting, (b) the name and address, as they appear on ConAgra’s books, of the stockholder proposing such business, and the name and address of the beneficial owner, if any, on whose behalf the proposal is made, (c) the class and number of shares of ConAgra which are owned of record and beneficially by the stockholder and beneficial owner, if any, (d) any material interest of the stockholder and beneficial owner, if any, in such business, (e) a representation that the stockholder is a holder of record of stock of ConAgra entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to propose such business and (f) a representation whether the stockholder or the beneficial owner, if any, intends or is part of a group which intends to (i) deliver a proxy statement and/or form of proxy to holders of at least the percentage of ConAgra’s outstanding capital stock required to approve or adopt the proposal and/or (ii) otherwise solicit proxies from stockholders in support of such proposal. Notwithstanding anything in the By-Laws to the contrary, no business shall be conducted at an annual meeting except in accordance with the procedures set forth in this Section 10. The Chairman of an annual meeting shall, if the facts warrant, determine and declare to the meeting that business was not properly brought before the meeting in accordance with the provisions of this Section 10, and if such person should so determine, such person shall so declare to the meeting and any such business not properly brought before the meeting shall not be transacted.

Section 11. Notice of Stockholder Nominees at an Annual Meeting. Only persons who are nominated in accordance with the procedures set forth in these By-Laws shall be eligible for election as directors. Nominations of persons for election to the Board of Directors of ConAgra may be made at an annual meeting of stockholders (a) by or at the direction of the Board of Directors or (b) by any stockholder of ConAgra who was a stockholder of record at the time of giving of notice provided for in

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Section 4, who is entitled to vote at the annual meeting and entitled to vote for the election of directors at the meeting who complies with the notice procedures set forth in this Section 11. Such nominations, other than those made by or at the direction of the Board of Directors, shall be made pursuant to timely notice in writing to the Secretary of ConAgra. To be timely, a stockholder’s notice shall be delivered to or mailed and received at the principal executive offices of ConAgra not less than 90 nor more than 120 days prior to the first anniversary of the preceding year’s annual meeting; provided, however, that in the event the date of the annual meeting is advanced by more than 30 days, or delayed by more than 60 days, from such anniversary date, notice by the stockholder to be timely must be so delivered or mailed and received not earlier than the 120th day prior to such annual meeting and not later than the close of business on the later of the 90th day prior to such annual meeting or the tenth day following the date on which public announcement of the date of such meeting is first made. In no event shall the public announcement of an adjournment or postponement of an annual meeting commence a new time period (or extend any time period) for the giving of a stockholder’s notice as described above. Such stockholder’s notice shall set forth (a) as to each person whom the stockholder proposes to nominate for election or re-election as a director, all information relating to such person that is required to be disclose in solicitations of proxies for election of directors, or is otherwise required, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (including such person’s written consent to be named as a nominee and to serving as the director if elected); and (b) as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the nomination is made, (i) the name and address, as they appear on ConAgra’s books, of such stockholder and the name and address of the beneficial owner, if any, (ii) the class and number of shares of ConAgra which are owned of record and beneficially by such stockholder and beneficial owner, if any, (iii) a representation that the stockholder is a holder of record of stock of ConAgra entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to propose such nomination, and (iv) a representation whether the stockholder or the beneficial owner, if any, intends or is part of a group which intends to (a) deliver a proxy statement and/or form of proxy to holders of at least the percentage of ConAgra’s outstanding capital stock required to elect the nominee and/or (b) otherwise solicit proxies from stockholders in support of such nomination. At the request of the Board of Directors any person nominated by the Board of Directors for election as a director shall furnish to the Secretary of ConAgra that information required to be set forth in a stockholder’s notice of nomination which pertains to the nominee. No person shall be eligible for election as a director of ConAgra unless nominated in accordance with the procedures set forth in the By-Laws. The Chairman of the meeting shall, if the facts warrant, determine and declare to the meeting that a nomination was not made in accordance with the procedures prescribed by the By-Laws, and if such person should so determine, such person shall so declare to the meeting and the defective nomination shall be disregarded.

Section 12. Notice of Stockholder Nominees at a Special Meeting. Only such business shall be conducted at a special meeting of stockholders as shall have been brought before the meeting pursuant to ConAgra’s notice of meeting. Nominations of persons for election to the Board of Directors may be made at a special meeting of stockholders at which directors are to be elected pursuant to ConAgra’s notice of meeting (a) by or at the direction of the Board of Directors or (b) provided that the Board of Directors has determined that directors shall be elected at such meeting, by any stockholder of ConAgra who is a stockholder of record at the time of giving of notice provided for in Section 4, who shall be entitled to vote at the special meeting and who complies with the notice procedures set forth in Section 11. In the event ConAgra calls a special meeting of stockholders for the purpose of electing one or more directors to the Board of Directors, any such stockholder may nominate a person or persons (as the case may be), for election to such position(s) as specified in ConAgra’s notice of meeting, if the stockholder’s notice required by Section 11 shall be delivered to the Secretary at the principal executive offices of ConAgra not earlier than the close of business on the 120th day prior to such special meeting and not later than the close of business on the later of the 90th day prior to such special meeting or the 10th day following the day on which public announcement is first made of the date of the special meeting and of the nominees proposed by the Board of Directors to be elected at such meeting. In no event shall the public announcement of an adjournment or postponement of a special meeting commence a new time period (or extend any time period) for the giving of a stockholder’s notice as described above.

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Section 13. Inspectors of Elections. The Board of Directors by resolution shall appoint one or more inspectors, which inspector or inspectors may include individuals who serve ConAgra in other capacities, including, without limitation, as officers, employees, agents or representatives, to act at the meetings of stockholders and make a written report thereof. One or more persons may be designated as alternate inspectors to replace any inspector who fails to act. If no inspector or alternate has been appointed to act or is able to act at a meeting of stockholders, the Chairman of the meeting shall appoint one or more inspectors to act at the meeting. Each inspector, before discharging his or her duties, shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of his or her ability. The inspectors shall have the duties prescribed by law.

Section 14. Conduct of Meetings. The date and time of the opening and the closing of the polls for each matter upon which the stockholders will vote at a meeting shall be announced at the meeting by the person presiding over the meeting. The Board of Directors may adopt by resolution such rules and regulations for the conduct of the meeting of stockholders as it shall deem appropriate. Except to the extent inconsistent with such rules and regulations as adopted by the Board of Directors, the chairman of any meeting of stockholders shall have the right and authority to convene and to adjourn the meeting, to prescribe such rules, regulations and procedures and to do all such acts, as in the judgment of such chairman, are appropriate for the proper conduct of the meeting. Unless and to the extent determined by the Board of Directors or the chairman of the meeting, meetings of stockholders shall not be required to be held in accordance with the rules of parliamentary procedure.

ARTICLE III

BOARD OF DIRECTORS

Section 1. General Powers. The business and affairs of ConAgra shall be managed by or under the direction of its Board of Directors. In addition to the powers and authorities by these By-Laws expressly conferred upon them, the Board of Directors may exercise all such powers of ConAgra and do all such lawful acts and things as are not by statute or by the Certificate of Incorporation or by these By-Laws required to be exercised or done by the stockholders.

Section 2. Number, Tenure and Qualifications. The number of directors of ConAgra, not less than nine nor more than sixteen, shall be fixed by resolution of the Board of Directors and may be altered from time to time by a resolution of the Board of Directors. Directors need not be residents of the State of Delaware or stockholders of ConAgra. Until the annual election of directors by the stockholders in 2008, the directors shall be divided into three classes: Class I, Class II and Class III, each such class, as nearly as possible, to have the same number of directors. The term of office of the class of directors elected in 2003 shall expire at the annual election of directors by the stockholders in 2006, the term of office of the class of directors elected in 2004 shall expire at the annual election of directors by the stockholders in 2007, and the term of office of the class of directors elected in 2005 shall expire at the annual election of directors by the stockholders in 2008, or in each case thereafter when their respective successors are elected by the stockholders and qualify.  At each annual election of directors by the stockholders of ConAgra held after 2005, the directors chosen to succeed those whose terms are then expired shall be elected by the stockholders of ConAgra for a term ending at the annual election of directors by the stockholders following the annual election of directors by the stockholders at which the director was elected, or thereafter when their respective successors in each case are elected by the stockholders and qualify. Commencing with the annual election of directors by the stockholder in 2008, the classification of the Board of Directors shall terminate and all directors shall be of one class.  It shall be a qualification for initial election of a person to the board that such person shall have executed an insider trading agreement with the company, such agreement to become effective upon such person’s election to the board. It shall be a qualification for reelection of any director to the board that such director, while a director, shall have at all times after April 10, 2002 been a signatory to and have been in full compliance with an insider trading agreement with the company. As used in the two preceding sentences, “insider trading agreement’ shall mean an agreement, in such form as shall be approved from time to time by the

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board, relating to the purchase or other acquisition, and the sale or other disposition, of securities of the company by directors of the company.

Section 3. Regular Meetings. A regular meeting of the Board of Directors shall be held on the same date as the annual meeting of stockholders. Three or more other regular meetings of the Board of Directors shall be held during the year with such meetings on dates approved by a majority of the Board of Directors. The Chairman of the Board or the Chief Executive Officer or the Secretary shall designate the time and place of such meeting by notice to each director at least ten days before the meeting. In the event meeting dates are not approved by a majority of the Board of Directors, regular meetings shall be held on the third Thursday of January, May, July and September. Meetings of the Board of Directors may be held either within or without the State of Delaware. The Board of Directors may provide, by resolution, the time and place, either within or without the State of Delaware, for the holding of the regular meetings or additional regular meetings without other notice than such resolution.

Section 4. Special Meetings. Special meetings of the Board of Directors may be called by or at the request of the Chairman of the Board, Chairman of the Executive Committee, Chief Executive Officer, or a majority of the Board of Directors. The person or persons authorized to call special meetings of the Board of Directors may fix any place, either within or without the State of Delaware, as the place for holding any special meeting of the Board of Directors called by them.

Section 5. Notice. Notice shall be given three days in advance of any special meeting of the Board of Directors, or in emergency situations designated by the Chairman of the Board, Chairman of the Executive Committee, or the Chief Executive Officer, 12 hours’ notice of a special meeting of the Board of Directors may be given, by telegram, telephone, personal delivery, telecopier or other means of electronic transmission. Notices of other meetings of the Board of Directors may be given by mail or may (and, if three or fewer days notice is given, shall) be given by telegram, telephone, personal delivery, telecopier or other means of electronic transmission. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail so addressed, with postage prepaid. If notice is given by telegram, such notice shall be deemed to be delivered when transmitted. Any director may waive notice of any meeting. The attendance of a director at a meeting shall constitute a waiver of notice of such meeting, except where a director attends a meeting for the express purpose of objecting to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the Board of Directors need be specified in the notice or waiver of notice of such meeting.

Section 6. Quorum. A majority of the number of directors fixed in accordance with Section 2 of this Article III shall constitute a quorum for the transaction of business at any meeting of the Board of Directors, but if less than such majority is present at a meeting, a majority of the directors present may adjourn the meeting from time to time without further notice.

Section 7. Manner of Acting. Except as otherwise required by applicable law, the act of the majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors. Any action required or permitted to be taken at any meeting of the Board of Directors may be taken without a meeting if a written consent thereto is signed by all members of the board and such written consent is filed with the minutes of the proceedings of the Board. A consent in lieu of meeting may be made either by one consent signed by all the directors or by individual consents signed by each director. The directors may also meet by means of conference telephone or similar communications equipment as provided by Delaware law.

Section 8. Vacancies. Vacancies and newly created directorships resulting from any increase in the authorized number of directors shall be filled by a majority of the directors then in office, although less than a quorum. Directors so chosen shall hold office for a term expiring at the annual meeting of stockholders at which the term of office of the class to which they have been elected expires and until such director’s successor shall have been duly elected and qualified. No decrease in the number of authorized directors constituting the full Board of Directors shall shorten the term of any incumbent director.

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Section 9. Compensation. By resolution of the Board of Directors, the directors may be paid expenses, if any, for attendance at each meeting of the Board of Directors. In addition, by resolution of the Board of Directors, each director may be paid an annual retainer fee and committee fees for services as director and may also receive a fee for attendance at regular or special meetings of the Board of Directors. No such payment shall preclude any director from serving ConAgra in any other capacity and receiving compensation therefor.

Section 10. Directors’ Executive Committee. An Executive Committee of three or more directors may be designated by resolution passed by a majority of the Board. The Board shall designate one director as chairman of the committee, and may designate one or more directors as alternate members of the committee who may replace any absent or disqualified member at any meeting of the committee. During the intervals between meetings of the Board, the committee shall advise and aid the officers of ConAgra in all matters concerning its interests and the management of its business, and generally perform such duties as may be directed by the Board from time to time. The committee shall possess and may exercise all the powers of the Board while the Board is not in session, but specifically shall not have the authority of the Board of Directors in reference to:

1. Amending the Certificate of Incorporation.

2. Adopting a plan of merger or consolidation.

3. Recommending to the stockholders the sale, lease, exchange, mortgage, pledge or other disposition of all or substantially all the property and assets of ConAgra otherwise than in the usual and regular course of its business.

4. Recommending to the stockholders a voluntary dissolution of ConAgra or a revocation thereof.

5. Amending the By-Laws of ConAgra.

6. Any power which has been delegated to other committees in accordance with these By-Laws.

7. Electing any director or electing or removing any member of the Executive Committee or any principal officer, or

8. Declaring any dividend or authorizing any distribution on any shares of capital stock of ConAgra.

Section 11. Human Resources Committee. A Human Resources Committee shall be designated by a resolution passed by a majority of the Board of Directors. The Board shall appoint one of the Committee members to serve as Chairman.

Section 12. Audit Committee. An Audit Committee shall be designated by a resolution passed by a majority of the Board of Directors. The Board shall appoint one of the Committee members to serve as Chairman.

Section 13. Other Committees. One or more other Board of Directors’ committee members and chairman thereof may be designated by resolution passed by a majority of the Board.

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ARTICLE IV

OFFICERS

Section 1. Number and Status. The Board of Directors will elect a chairman of the Board, may elect a vice-chairman of the Board, and may elect such honorary (non-voting) directors as deemed advisable. The elected officers of ConAgra shall consist of the Chief Executive Officer (CEO) who shall also carry the legal title of president; one or more members of the Office of the President (the number thereof to be designated by the CEO); one or more elected corporate Vice Presidents (the number thereof to be determined by the CEO); a Secretary; and may include a President and Chief Operating Officer. The CEO shall be nominated and elected by the Board of Directors. Other elected officers shall be nominated by the CEO and elected by a majority of the Board of Directors. Other corporate officers, including a Treasurer, and assistant corporate officers as may be deemed necessary by the CEO, may be appointed by the CEO and shall be confirmed by the Board of Directors. The CEO may also designate as many Independent Operating Companies’ (IOC) officers as the CEO deems necessary to manage operating units of ConAgra. Authority of IOC officers shall relate only to businesses for which they have been assigned responsibility. No authority granted to IOC officers shall conflict with authorities granted by these By-Laws or by resolutions of the Board of Directors.

Section 2. Election and Term of Office. The officers of ConAgra to be elected or confirmed by a majority of the Board of Directors shall be elected and confirmed annually at the meeting of the Board of Directors on the same date as the annual meeting of stockholders. If the election and appointment of officers shall not be held at such meeting, then they shall be held as soon thereafter as conveniently possible. Each officer shall hold office until the officer’s death, or resignation, or removal in the manner hereinafter provided.

Section 3. Removal. Officers elected by the Board of Directors may be removed at any time by a majority vote of the Board of Directors, or by the CEO with such action to be affirmed by a majority vote of the Board of Directors. Appointed corporate and IOC officers may be removed from office by the CEO or any officer designated by the CEO to have such authority. The acceptance of office by an officer shall constitute acceptance of this provision.

Section 4. Vacancies. A vacancy in any elected office because of death, resignation, removal, disqualification or otherwise, shall be filled by a majority vote of the Board of Directors for the unexpired portion of the term. The CEO may fill vacancies of appointed corporate and IOC officers.

Section 5. Chairman of the Board of Directors. The chairman of the Board of Directors shall preside at all meetings of stockholders and the Board of Directors, and shall have such other duties as may be assigned by resolution of the Board of Directors.

Section 6. Vice Chairman of the Board of Directors. The vice chairman of the Board of Directors may preside at meetings of the Board of Directors in the absence of the chairman of the Board of Directors and the CEO, and shall have such other duties as may be assigned by resolution of the Board of Directors.

Section 7. Chief Executive Officer (CEO). Subject to the authority of the Board of Directors, the Chief Executive Officer shall be the highest ranking management officer of ConAgra, lead its business affairs and perform all duties incident to the office of chief executive. The CEO shall preside at all meetings of the stockholders and of the Board of Directors in the absence of the chairman of the Board of Directors. The CEO may sign with the Secretary or any other elected officer, certificates for shares of ConAgra; and may sign (or authorize a designee to sign) deeds, mortgages, bonds, contracts, or other instruments within authority granted by the Board of Directors (except in cases where the signing and execution thereof shall be expressly delegated by the Board of Directors or by these By-Laws to some other officer or agent of ConAgra). The CEO shall assign job duties, responsibilities, and authorities to other officers of ConAgra, or designate others to do so. In the event of the CEO’s inability to serve, CEO duties shall be temporarily fulfilled, pending action by the Board of Directors, first by the Chairman of the Board, or next in line by the Chairman of the Executive Committee, or next by the Chairman of the Audit Committee, or next by the Chairman of the Compensation Committee.

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Section 8. President and Chief Operating Officer. There may be one President and Chief Operating Officer of ConAgra. This individual will report directly to the CEO and shall have such duties, responsibilities and authority as, from time to time, are assigned by the CEO or the Board of Directors.

Section 9. Office of the President. ConAgra shall have an Office of the President, the members of which shall be nominated by the CEO and elected by the Board of Directors. Each member shall serve as the head of one or more of ConAgra’s major business units. Each member shall carry the title of “President and Chief Operating Officer” of such business units. Each member will report to ConAgra’s CEO, or the President and Chief Operating Officer of ConAgra, as may be specified by the CEO, and shall have such duties, responsibilities and authority as, from time to time, are assigned by the CEO, President and Chief Operating Officer of ConAgra, or the Board of Directors.

Section 10. Corporate Vice Presidents. Any elected Vice President may sign, with the Secretary or Assistant Secretary, certificates for shares of ConAgra. Each ConAgra vice president shall perform such duties and have such responsibility and authority as from time to time may be assigned by the CEO, an officer so authorized by the CEO, or the Board of Directors.

Section 11. The Secretary. The Secretary shall: (a) keep the minutes of the stockholders’ meetings and of the Board of Directors’ meetings; (b) see that all notices are fully given in accordance with the provisions of these By-Laws or required by law; (c) be custodian of ConAgra minutes and of the seal of ConAgra; (d) sign certificates for shares of ConAgra, the issuance of which shall have been authorized by resolution of the Board of Directors; (e) supervise activities of transfer agents and registrars; and (f) in general perform duties incident to the office of the Secretary as from time to time may be assigned by the CEO or the Board of Directors.

Section 12. The Treasurer. The Treasurer shall perform duties incident to the office of the Treasurer in accordance with these By-Laws, and shall perform such other duties as, from time to time, may be assigned by the CEO, Board of Directors, or officer to whom the Treasurer reports.

Section 13. Assistant Secretaries and Assistant Treasurers. The Assistant Secretaries and Assistant Treasurers shall perform such duties as shall be assigned to them by the Secretary or Treasurer, respectively, by the CEO or by the Board of Directors.

Section 14. Salaries. The salaries of the elected and confirmed officers shall be fixed from time to time by the Board of Directors or by those so authorized by the Board of Directors. No officer shall be prevented from receiving a salary by reason of the fact that such person is also a director of ConAgra.

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ARTICLE V

CONTRACTS, LOANS, CHECKS, AND DEPOSITS

Section 1. Contracts. The Board of Directors may authorize any officer or officers, or agent or agents, to enter into any contract or execute and deliver any instrument in the name of and on behalf of ConAgra, and such authority may be general or confined to specific instances.

Section 2. Loans. No loans shall be contracted on behalf of ConAgra and no evidences of indebtedness shall be issued in its name unless authorized by a resolution of the Board of Directors. Such authority may be general or confined to specific instances.

Section 3. Checks, Drafts, etc. All checks, drafts, other orders for the payment of money, notes, or other evidences of indebtedness issued in the name of ConAgra shall be executed on behalf of ConAgra only by those who are authorized by the Board of Directors or by those whom the Board may designate to give such authorization. Such authorization may be general or confined to specific instances.

Section 4. Deposits. All funds of ConAgra not otherwise employed shall be deposited to the credit of ConAgra in banks, trust companies, or other depositaries, approved in accordance with resolutions of the Board of Directors.

ARTICLE VI

CERTIFICATES FOR SHARES AND THEIR TRANSFER

Section 1. Certificates for Shares. Certificates representing shares of ConAgra shall be in such form as shall be determined by the Board of Directors. Such certificates shall be signed by the Chairman, Chief Executive Officer, Chief Operating Officer, or a Corporate Vice President and by the Secretary or an Assistant Secretary, except that the signatures of any such Chairman, Chief Executive Officer, Chief Operating Officer, Corporate Vice President, Secretary or Assistant Secretary may be facsimiles, engraved or printed. All certificates for shares shall be consecutively numbered or otherwise identified. The name and address of the person to whom the shares represented thereby are issued, with the number of shares and date of issue, shall be entered on the stock transfer books of ConAgra. All certificates surrendered to ConAgra, or its agent, for transfer shall be canceled and a new certificate shall be issued only after the former certificate for a like number of shares shall have been surrendered and canceled, except that in case of a lost, destroyed, or mutilated certificate a new one may be issued therefor upon such terms and indemnity to ConAgra as the Board of Directors may prescribe.

Section 2. Transfer of Shares. Transfer of shares of ConAgra shall be made only on the stock transfer books of ConAgra by the holder of record thereof or by his legal representative, who shall furnish proper evidence of authority to transfer, or by his attorney authorized by power of attorney duly executed and filed with the transfer agent of ConAgra, and on surrender for cancellation of the certificate for such shares. The person in whose name shares stand on the books of ConAgra shall be deemed by ConAgra to be the owner thereof for all purposes.

Section 3. Fractional Shares. No fractional shares of stock of ConAgra shall be transferred, issued, or reissued.

Section 4. Charge for Certificates. ConAgra may invoke a charge approximately equal to the cost of issuing a stock certificate for each certificate of stock to be issued or reissued in excess of the minimum number of certificates required, if the number of certificates requested by a stockholder is deemed by the Secretary to be unreasonable.

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ARTICLE VII

INDEMNIFICATION

Section 1. Actions by Others. ConAgra shall indemnify any person who was or is a party to or is threatened to be made a party to any threatened, pending or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative (other than an action by or in the right of ConAgra) by reason of the fact that such person is or was a director, officer, employee or agent of ConAgra, or is or was serving at the request of ConAgra as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, or other enterprise, against expenses (including attorneys’ fees), judgments, fines, and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of ConAgra, and, with respect to any criminal action or proceedings, had no reasonable cause to believe the conduct was criminal. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which such person reasonably believed to be in or not opposed to the best interest of ConAgra, and, with respect to any criminal action or proceeding, had reasonable cause to believe that the conduct was criminal.

Section 2. Actions by or in the Right of ConAgra. ConAgra shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of ConAgra to procure a judgment in its favor by reason of the fact that such person is or was a director, officer, employee or agent of ConAgra, or is or was serving at the request of ConAgra, as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with the defense or settlement of such action or suit if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of ConAgra and except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to ConAgra unless and only to the extent that the Delaware Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Delaware Court of Chancery or such other court shall deem proper.

Section 3. Successful Defense. To the extent that a director, officer, employee or agent of ConAgra has been successful on the merits or otherwise, including, without limitation, the dismissal of an action without prejudice, in defense of any action, suit or proceeding referred to in Sections 1 and 2 of this Article, or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith.

Section 4. Specific Authorization. Any indemnification under Section 1 and 2 of this Article (unless ordered by a court) shall be made by ConAgra only as authorized in the specific case upon a determination that indemnification of the director, officer, employee or agent is proper in the circumstances because such person has met the applicable standard of conduct set forth in said Sections 1 and 2. Such determination shall be made (1) by the Board of Directors by a majority vote of a quorum consisting of directors who were not parties to such action, suit or proceeding, or (2) if such quorum is not obtainable, or, even if obtainable a quorum of disinterested directors so directs, by independent legal counsel in a written opinion, or (3) by the stockholders.

Section 5. Advance of Expenses. Expenses incurred by an elected officer or director in defending a civil or criminal action, suit or proceeding shall be paid by ConAgra in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such director or

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EXHIBIT 3.2

elected officer to repay such amount if it shall ultimately be determined that such person is not entitled to be indemnified by ConAgra as authorized in this Article. Such expenses incurred by other officers, employees and agents may be so paid upon such terms and conditions, if any, as the Board of Directors deems appropriate.

Section 6. Right of Indemnity Not Exclusive. The indemnification and advancement of expenses provided by or granted pursuant to the Certificate of Incorporation or these By-Laws shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under any By-Law, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office.

Section 7. Insurance. ConAgra may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of ConAgra, or is or was serving at the request of ConAgra as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of such person’s status as such, whether or not ConAgra would have the power to indemnify such person against such liability under the provisions of this Article, Section 145 of the General Corporation Law of the State of Delaware, or otherwise.

Section 8. Employee Benefit Plans. For purposes of this Article, references to “other enterprises” shall include employee benefit plans; references to “fines” shall include any excise taxes assessed on a person with respect to an employee benefit plan; and references to “serving at the request of ConAgra” shall include any service as a director, officer, employee or agent of ConAgra which imposes duties on, or involves services by, such director, officer, employee, or agent with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner such person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of ConAgra” as referred to in this Article.

Section 9. Invalidity of any Provisions of this Article. The invalidity or unenforceability of any provisions of this Article shall not affect the validity or enforceability of the remaining provisions of this Article.

Section 10. Continuation of Indemnification. The indemnification and advancement of expenses, to the extent provided by or granted pursuant to this Article, these By-Laws, or the Certificate of Incorporation shall continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors, and administrators of such person. All rights to indemnification provided by or granted pursuant to this Article, these By-Laws, or the Certificate of Incorporation shall be deemed to be a contract between ConAgra and each director, officer, employee, or agent of ConAgra who serves or served in such capacity at any time while this Article VII is in effect. Any repeal or modification of this Article VII shall not in any way diminish any rights to indemnification of such directors, officer, employee or agent, or the obligations of ConAgra arising hereunder.

Section 11. Certain Claims. Notwithstanding Section 1 and Section 2 of this Article VII, ConAgra shall be required to indemnify a person described in the first sentence of Section 1 or Section 2 of this Article VII in connection with an action, suit or proceeding (or part thereof) commenced by such a person only if the commencement of such proceeding (or part thereof) by such person was authorized by the Board of Directors.

ARTICLE VIII

FISCAL YEAR

The fiscal year of ConAgra shall end on the last Sunday in May.

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EXHIBIT 3.2

ARTICLE IX

DIVIDENDS

The Board of Directors may from time to time declare, and ConAgra may pay, dividends on its outstanding shares in the manner and upon the terms and conditions provided by law and its Certificate of Incorporation.

ARTICLE X

SEAL

The Board of Directors shall provide a corporate seal which shall be circular in form and shall have inscribed thereon the name of ConAgra Foods, Inc. on the outer edge, and the words, “Corporate Seal,” in the center.

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EXHIBIT 3.2

ARTICLE XI

WAIVER OF NOTICE

Whenever any notice is required to be given to any stockholder or director of ConAgra under the provisions of these By-Laws or under the provisions of the Certificate of Incorporation or under the provisions of the laws of Delaware, a waiver thereof in writing, signed by the person or persons entitled to such notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice.

ARTICLE XII

AMENDMENTS

These By-Laws may be altered, amended, or repealed and new By-Laws may be adopted by the Board of Directors at any regular or special meeting of the Board of Directors.

9/22/05

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EX-12

EXHIBIT 12

ConAgra Foods, Inc. and Subsidiaries

Computation of Ratio of Earnings to Fixed Charges

(in millions)

	Thirteen weeks ended August 28, 2005
Earnings:
Income from continuing operations before income taxes and equity method investment earnings	$	554.9
Add/(deduct):
Fixed charges	94.3
Distributed income of equity method investees	2.1
Capitalized interest	(1.2		)
Earnings available for fixed charges (a)	$	650.1
Fixed charges:
Interest expense	$	74.0
Capitalized interest	1.2
Interest in cost of goods sold	4.4
One third of rental expense (1)	14.7
Total fixed charges (b)	$	94.3
Ratio of earnings to fixed charges (a/b)	6.9

⁽¹⁾  Considered to be representative of interest factor in rental expense.

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EX-31.1

EXHIBIT 31.1

CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER

I, Gary M. Rodkin, certify that:

1.I have reviewed this quarterly report on Form 10-Q for the quarter ended August 28, 2005 of ConAgra Foods, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the presentation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: October 7, 2005

/s/ GARY M. RODKIN

Gary M. Rodkin

Chief Executive Officer

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EX-31.2

EXHIBIT 31.2

CERTIFICATION OF THE CHIEF FINANCIAL OFFICER

I, Frank S. Sklarsky, certify that:

1.I have reviewed this quarterly report on Form 10-Q for the quarter ended August 28, 2005 of ConAgra Foods, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the presentation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: October 7, 2005

/s/ FRANK S. SKLARSKY

Frank S. Sklarsky

Executive Vice President, Chief Financial Officer

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EX-32.1

EXHIBIT 32.1

CERTIFICATION

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

I, Gary M. Rodkin, Chief Executive Officer of ConAgra Foods, Inc., certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to my knowledge that ConAgra Foods, Inc.’s Quarterly Report on Form 10-Q for the quarter ended August 28, 2005 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and that the information contained in such Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of ConAgra Foods, Inc.

October 7, 2005

/s/ GARY M. RODKIN

Gary M. Rodkin

Chief Executive Officer

I, Frank S. Sklarsky, Executive Vice President, Chief Financial Officer of ConAgra Foods, Inc., certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to my knowledge that ConAgra Foods, Inc.’s Quarterly Report on Form 10-Q for the quarter ended August 28, 2005 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and that the information contained in such Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of ConAgra Foods, Inc.

October 7, 2005

/s/ FRANK S. SKLARSKY

Frank S. Sklarsky

Executive Vice President, Chief Financial Officer

A signed original of this written statement required by Section 906 has been provided to ConAgra Foods, Inc. and will be retained by ConAgra Foods, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

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