Hormel Foods Corp, the maker of Spam lunch meat, reported lower-than-expected quarterly sales and said its Jennie-O Turkey Store business would be "significantly challenged" due to an outbreak of avian flu in the United States.

The company said last month that a fall in turkey supplies would push its full-year adjusted earnings towards the lower end of its forecast range of $2.50-$2.60 per share.

Hormel reaffirmed the forecast on Wednesday.

The Jennie-O business, which accounts for about 18 percent of Hormel's revenue, got about 78 percent of its turkeys from its farms in Minnesota and Wisconsin last year. The company got the rest of its turkeys from independent suppliers.

About 5.5 million turkeys and egg-laying chickens have either died from the flu virus or are set to be culled in Minnesota, the largest producer of U.S. turkeys, state officials said this month.

The virus has been confirmed in 16 states and Canada, and has devastated Midwestern poultry and egg producers in recent weeks, leading to the culling of 33 million birds.

The Jennie-O business ended the quarter facing substantial supply chain challenges brought on by the outbreak, Chief Executive Jeffrey Ettinger said in a statement.

Hormel said this month that it would temporarily lay off 233 workers at a Minnesota plant as the outbreak had reduced the number of turkeys available for processing.

The company's net income rose to $180.4 million, or 67 cents per share, in the second quarter ended April 26, from $140.7 million, or 52 cents per share, a year earlier, boosted by lower costs in its refrigerated foods business, its biggest.

Net sales rose 1.5 percent to $2.28 billion.

Analysts on an average had expected earnings of 62 cents per share and revenue of $2.40 billion, according to Thomson Reuters I/B/E/S.

Up to Tuesday's close of $55.79, Hormel's shares had fallen 4 percent since April 8, when the company announced that avian flu had been detected in one of its turkey flocks.