* Q1 EPS 29 cents ex-items vs. Wall St view 31 cents
* Sees greater commodity inflation for 2012
* Shares down 1.8 percent (Rewrites first paragraph, adds company and analyst comments, updates share price)
By Brad Dorfman
Sept 20 (Reuters) - ConAgra Foods Inc (CAG.N) Chief Executive Gary Rodkin made clear on Tuesday that the company was still on the hunt for acquisitions a day after it walked away from its months-long pursuit of Ralcorp Holdings Inc RAH.N.
“We have a pipeline of alternatives that we’ve been assessing,” Rodkin said during a conference call with analysts to discuss the company’s first-quarter earnings, which missed Wall Street’s expectations.
On Monday Ralcorp, which makes private-label foods that stores brand as their own, as well as Post cereals, again spurned ConAgra’s $94 a share offer and stood by its plan to split up those businesses into two companies.
Private label has been a growing sector as consumers, pressured by high unemployment and rising costs for everything from gasoline to food, look for ways to save money.
With a portfolio that includes second-tier brands like Hunt’s ketchup and Peter Pan peanut butter that can have a harder time raising prices to offset rising ingredient costs, analysts said that expanding its private-label business would be a smart move for ConAgra.
Some supermarket chains are giving less shelf space to second-tier brands to make room for their own private-label items.
“Overall, we do not think that yesterday’s news changes ConAgra’s strategic priority to build out its private-label business,” Morningstar analyst Erin Lash said.
She noted that Treehouse Foods Inc (THS.N) — which makes private-label soups, macaroni and cheese, hot cereal and other products — is a potential target.
Rodkin declined on Tuesday to comment on specific targets. He said that private label, international and products that are “adjacent” to the company’s core brands are all areas for potential acquisitions.
Like most food companies, ConAgra has been trying to raise prices to offset rising costs, and it expects price increases to help earnings in the second half of the year.
But the price increases are not enough to offset rising costs for meat, packaging and fats and oils, the company said.
“We understand the current difficult conditions facing everyday consumers,” Rodkin said. “And those conditions impose practical limits on what we can and should do through pricing.”
ConAgra, which also makes Chef Boyardee pasta and Pam cooking spray, earned $85.3 million, or 20 cents per share, in the first quarter ended on Aug. 28, compared with $146.4 million or 33 cents per share a year earlier.
Excluding one-time items, ConAgra earned 29 cents per share. Analysts on average forecast 31 cents, according to Thomson Reuters I/B/E/S.
Shares of ConAgra were down 1.8 percent at $22.96 on Tuesday morning on the New York Stock Exchange.
Sales rose 9.5 percent to $3.07 billion, helped by price increases. Analysts had forecast $2.94 billion.
ConAgra said in June that profit growth for the current fiscal year would be below its long-term goal of 6 to 8 percent, due mostly to higher costs for everything from meat to packaging.
It warned at the time that first-quarter profit would be lower than a year earlier as price increases have not kept pace with accelerating inflation.
On Tuesday, the company said it expected commodity costs to rise 9 to 10 percent in its consumer foods segment this year, up from its previous forecast of a 7 to 8 percent increase.
The company still expects full-year earnings per share to increase at a low to mid single-digit percentage rate from the $1.75 reported for fiscal 2011, excluding one-time items, with the growth coming in the second half of the year. (Reporting by Brad Dorfman in Chicago. Additional reporting by Martinne Geller in New York; Editing by Maureen Bavdek, Lisa Von Ahn and Matthew Lewis)