Lamb Weston reported higher fourth-quarter and full-year sales for fiscal 2026, as volume growth and improved performance in North America offset weaker results from its international operations.

The frozen potato products manufacturer generated net sales of USD6.61bn in the 53 weeks ended May 31, an increase of 2% from USD6.45bn in fiscal 2025. Sales volume rose 7%, while price and product mix declined 6%. Foreign exchange contributed one percentage point to reported growth.

Full-year net income fell 19% to USD290m, while adjusted EBITDA declined 9% to USD1.15bn. Adjusted diluted earnings per share decreased from USD3.58 to USD3.01.

Despite the year-on-year decline in profitability, both net sales and adjusted EBITDA exceeded the upper end of Lamb Weston’s revised fiscal 2026 guidance.

“This past year marked an important inflection point for our Company,” said Mike Smith, Lamb Weston president and CEO. “We overdelivered on our financial guidance with solid performance in sales and profitability, led by volume growth in North America.”

North American net sales increased 3% to USD4.40bn during the year, supported by a 9% rise in volume. This was partially offset by a 6% reduction in price and mix.

Adjusted EBITDA for the North American segment increased 3% to USD1.14bn. Lamb Weston attributed the improvement to higher sales volumes, lower manufacturing costs per pound and savings generated under its cost-reduction program.

Fourth-quarter North American sales rose 9% to USD1.21bn, with volume increasing 11%. The company said growth reflected customer contract wins, market share gains, customer retention and the additional week included in the reporting period.

Quarterly adjusted EBITDA for the segment increased 17% to USD305m.

“Looking forward, I am highly encouraged by the success we have seen in year one of Focus to Win, particularly the customer momentum that we built through new wins and strengthening of existing relationships,” Smith said.

Performance outside North America remained under pressure. Full-year international sales increased 1% to USD2.22bn, but declined 4% excluding foreign exchange. International adjusted EBITDA fell 55% to USD115m.

Lamb Weston attributed the decline to competitive pressure in Europe, the Middle East and Africa, weaker price and mix, and higher manufacturing costs. The result also included a USD33.1m pre-tax charge related to potato write-offs.

In the fourth quarter, international sales decreased 2% to USD564m and were down 6% excluding currency effects. Adjusted EBITDA for the segment fell 81% to USD12m.

The company said sales growth in Asia-Pacific and Latin America was more than offset by difficult market conditions in EMEA and disruption associated with conflict in the Middle East.

Lamb Weston has also announced its intention to close its production facility in Broekhuizenvorst, the Netherlands, as part of efforts to align its manufacturing footprint with market demand.

At group level, fourth-quarter net sales increased 6% to USD1.77bn. Volume rose 7%, while price and mix declined 3%. Sales volume increased for the sixth consecutive quarter.

Quarterly net income fell 9% to USD110m, and adjusted EBITDA declined 2% to USD288m. Adjusted diluted earnings per share decreased from USD0.92 to USD0.87.

Lamb Weston said it exceeded its USD100m cost-savings milestone during fiscal 2026. Its Focus to Win program is intended to generate at least USD250m in annualized run-rate savings by the end of fiscal 2028.

For fiscal 2027, the company expects net sales to be flat or increase by up to 1% compared with fiscal 2026 on an adjusted 52-week basis. Adjusted EBITDA is forecast at between USD1.1bn and USD1.2bn, with adjusted diluted earnings per share of USD2.95 to USD3.25.

Planned cash expenditure on capital projects is expected to range from USD380m to USD410m.