Sara Lee Corp. to report 2Q results Thursday

Earnings Preview: Sara Lee Corp.

PORTLAND, Ore. — Sara Lee Corp., maker of Jimmy Dean sausages, Hillshire Farm deli meats and its namesake baked goods, reports its second-quarter results before the stock market opens Thursday.

WHAT TO WATCH FOR: How continued trimming of Sara Lee’s business lines affects the company, which is based Downers Grove, Ill.

Sara Lee has shed several lines to focus on its core food and beverage business and improve its profitability.

In December, Procter & Gamble Co. bought its Ambi Pur air freshener business for $470 million. And in September, Sara Lee announced it was selling its personal care products business to Unilever NV for $1.88 billion.

Sara Lee also plans launch several new products soon and has secured new partnerships such as a distribution deal for its commercial products with the food supply company Sysco Corp.

Analysts anticipate a modest increase in sales and profit as the changes take place.

“We continue to think Sara Lee is in the early stages of a multiyear earnings recovery,” Tim Ramey, an analyst with D.A. Davidson & Co., said in a note to investors.

WHY IT MATTERS: Although Sara Lee is among the food sector’s weaker players, it remains a key consumer goods company. Changes in what consumers buy and eat can be a key indicator of how the economy is faring.

WHAT’S EXPECTED: Analysts polled by Thomson Reuters, who typically exclude one-time items from their forecasts, expect Sara Lee to earn 23 cents per share on revenue of $3.1 billion.

LAST YEAR’S QUARTER: Sara Lee reported a loss of $17 million, or 2 cents per share, on revenue of $3.34 billion. Excluding a one-time charge the company said it earned 21 cents per share.