ConAgra Foods (CAG 0.38%) had a tough year in fiscal 2014, but fortunately, fiscal 2015 is off to a better start. The company made significant progress in stemming the sales declines in some of its major brands in the most recent quarter. Total sales fell 1% last quarter year over year, which doesn't sound great by any means, but it's a measurable improvement from the more serious declines last year. And, thanks to stricter cost controls, ConAgra's adjusted earnings per share actually grew 5% last quarter.

While the picture looks somewhat mixed for ConAgra, there's hope for future progress. ConAgra is pursuing some strategic initiatives that could pay off, and the company remains solidly profitable, and offers investors a solid 3% dividend yield. Here are a few reasons to stay bullish on ConAgra.

New products
A few of ConAgra's flagship brands, including Healthy Choice and Chef Boyardee, are suffering. Management points to weakness due to a changing consumer landscape. Consumers in the United States are increasingly opting for fresher foods, rather than frozen and canned goods. In ConAgra's consumer foods segment, volumes were flat, and net sales declined 1% last quarter, year over year.

In response, ConAgra is going to roll out some new products to reignite growth. One initiative is to focus on its Cafe Steamers line within the Healthy Choice brand. In last quarter's conference call, management stated that these Cafe Steamers are resonating better with consumers, and are showing strong growth.

When it comes to Chef Boyardee, ConAgra plans to return to its "easy-open" can that was popular with consumers, but management decided to discontinue. This proved to be a bad decision, and now ConAgra is going to once again pursue this product feature. These are hopeful signs that ConAgra can improve the performance of its key brands.

New leadership
Earlier this year, ConAgra Chief Executive Officer Gary Rodkin announced he would retire at the end of the current fiscal year. This could be a positive event for the company, as its sluggish results for the past several quarters indicate it's time to go in a different direction. ConAgra is still a very profitable company, but its performance has slipped, and the current management's strategic initiatives failed to cure what ails the company.

Perhaps what was arguably the most noteworthy event of Rodkin's tenure, the large acquisition of Ralcorp Holdings, has not worked out well. Last year, the company purchased Ralcorp for nearly $5 billion dollars to boost its presence in private label brands. To management's credit, this was a wise decision to branch out into a new business, given the struggles of ConAgra's core consumer brands.

Indeed, the acquisition brought in a significant new revenue stream for the company. But the integration of Ralcorp has been a much costlier effort than management imagined. Operating profit in ConAgra's private brands segment dropped 28% in the first quarter. ConAgra has had to endure significant integration costs, and was also not able to realize the synergies, such as eliminating duplicating costs, that management was counting on. With a new leadership team in tow, perhaps ConAgra can right the ship in its private brands business.

Balance sheet restructuring
ConAgra's high-profile acquisition left the company saddled with a lot of debt, which it's aggressively paying down to improve its financial position. This is a wise move, and will help free up future cash flow for dividend increases down the road.

ConAgra paid down $500 million of long-term debt in the first quarter. As of the start of the current quarter, ConAgra still held $7.7 billion in long-term debt. This was a significant reduction from the same period last year, but it's clear that the company still has a long ways to go. ConAgra has $5.7 billion in shareholder equity, meaning its long-term debt to equity ratio exceeds 100%. This will impair ConAgra's ability to raise dividends. But, by the end of fiscal 2015, management expects to repay approximately $1 billion of debt.

The bottom line is that ConAgra's turnaround continues. There's a long way to go, but new product innovations and new management leadership could provide the shake-ups the company needs to complete its turnaround. Improving the balance sheet will also put ConAgra on firmer financial footing.