ConAgra says pot pie recall to cost $30 million

LOS ANGELES (Reuters) - ConAgra Foods Inc. (CAG.N) on Wednesday said a recent recall of pot pies due to salmonella contamination would cost about $30 million.

The company also said it has resumed production of the Banquet and store brand pot pies, which were recalled on October 11.

The $30 million of costs, or 4 cents per share, would mainly be recorded in the fiscal second quarter. It will report those results on December 20.

For fiscal 2008, ConAgra said earnings in its trading and merchandising group would be stronger than expected and would offset the recall costs. It plans to provide full-year earnings targets next month.

ConAgra, which is based in Omaha, Nebraska, said the salmonella strain appeared to have been isolated to Banquet turkey pot pies produced on July 13 and July 31 of this year. No traces of salmonella were found in the pot pie production area of ConAgra's Marshall, Missouri plant, the company said.

ConAgra said it has developed enhanced procedures for its manufacturing plants, including more stringent testing.

(Reporting by Nichola Groom, editing by Gary Hill)