Fewer Sales, Higher Profits Tasty Treatment for Sara Lee

The Wall Street Journal (WSJ) says the Sara Lee Corporation is enjoying higher than expected profits from the first quarter of 2009 even though sales dropped.  Bet your local farmers wish they could get away with that trick.

Seems Sara Lee's sales dropped by 7.4% even as earnings soared to a whopping 45%.  The WSJ article says "lower input costs" are responsible for the jump in earnings, which is just a nice way of saying they're using cheaper ingredients than they've used in the past.

Recessionary food trends show more consumers are eating at home instead of dining out so they're buying more groceries.  And, theoretically, more Sara Lee products, which include everything with Sara Lee's name on it but it includes Jimmy Dean sausages, Ball Park hot dogs, and Hillshire Farm deli products as well.  One would think larger grocery bills would mean more sales for food-processing companies such as Sara Lee but their sales revenue fell nevertheless.

Fewer sales.  Higher profits.  A tasty treatment indeed.