EAGLE, IDAHO — Executives at Lamb Weston Holdings, Inc. continue to see “healthy” demand for french fries, said Thomas P. Werner, president and chief executive officer. The company benefited from pricing actions in the recent quarter, as well as an improvement in total restaurant traffic when compared to the year-ago period.

Quick-service restaurants, particularly burger and chicken chains, accounted for nearly all the growth, Mr. Werner said during an April 6 earnings call with securities analysts.

“In contrast, traffic at casual-dining and full-service restaurants fell versus the prior year,” he said. “This has a more pronounced effect on our Foodservice segment and contributed in part to a decline in that segment's volume. The fry attachment rate, which is the rate at which consumers order fries when visiting a restaurant or other foodservice outlets, remains solid.”

Management expects continued volatility in restaurant traffic and demand patterns in the months ahead as consumers adjust to a challenging economic environment. Demand for fries at food-at-home channels “remains solid,” Mr. Werner said.

Net income for the third quarter ended Feb. 26 was $175.1 million, equal to $1.22 per share on the common stock, up from $106.6 million, or 73¢ per share, in the prior-year period. The increase in income included a net gain of $4.3 million for acquisition-related items, partially offset by lower equity method investment earnings, which included a $47.3 million unrealized loss related to mark-to-market adjustments and a $19.3 million unrealized gain in the year-ago quarter. Excluding items affecting comparability, adjusted net income was $207.4 million, up from $92.3 million.

Net sales for the quarter totaled $1.3 billion, up 31% from $955 million the year before. The increase reflected the benefit of pricing actions across each of the company’s core business segments to counter higher input and manufacturing costs. Overall volume was flat, with growth in shipments to large chain restaurant and retail customers in North America offsetting the impact of exiting lower-priced, lower-margin business and, to a lesser extent, softer demand at casual dining and full-service restaurants.

The company’s Global segment, which represents the largest North American-based quick-service and full-service restaurant chain customers, as well as international business, had net sales of $648.5 million in the quarter, up 33% over the year before. Pricing actions drove the growth, as volume was flat compared to the prior year.

Net sales for the Foodservice segment, which comprises North American foodservice distributors and smaller North American restaurant chains, increased 22% to $360 million, benefiting from pricing actions.

In the Retail segment, which includes branded and private label products to grocery, mass merchant and club customers in North America, net sales increased 50% to $216 million. Volume rose 6%, reflecting strong growth in branded products and modest growth in private label products.

Lamb Weston recently completed the purchase of the remaining interest in its European joint venture with Meijer Frozen Foods BV for more than $680 million. The addition of the Lamb Weston Europe, Middle East and Africa business adds six factors and approximately 2 billion lbs of production capacity to the company’s global manufacturing footprint.

Management has updated the company’s full-year outlook to include the financial consolidation of Lamb Weston EMEA beginning in the fourth quarter. Net sales are expected to be between $5.25 billion to $5.35 billion, up from a previous forecasted range of $4.8 billion to $4.9 billion.

“About $300 million to $325 million of the increase reflects the consolidation of Lamb Weston EMEA,” said Bernadette M. Madarieta, chief financial officer. “The additional $100 million to $150 million increase reflects our strong results in our fiscal third quarter, and our expected continued momentum in the fourth quarter.”

 Net income for the fiscal year now is expected to be between $639 million to $664 million, up from the earlier target of $580 million to $620 million.