Attached files
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8-K - FORM 8-K - SNYDER'S-LANCE, INC. | g26233e8vk.htm |
EX-99.3 - EX-99.3 - SNYDER'S-LANCE, INC. | g26233exv99w3.htm |
EX-99.2 - EX-99.2 - SNYDER'S-LANCE, INC. | g26233exv99w2.htm |
EX-99.4 - EX-99.4 - SNYDER'S-LANCE, INC. | g26233exv99w4.htm |
Exhibit 99.1
CONTACTS:
Mark Carter, VP Strategic Initiatives and Investor Relations (704) 557-8386
Joe Calabrese, Financial Relations Board (212) 827-3772
Mark Carter, VP Strategic Initiatives and Investor Relations (704) 557-8386
Joe Calabrese, Financial Relations Board (212) 827-3772
IMMEDIATE RELEASE
February 18, 2011
February 18, 2011
Snyders-Lance, Inc. Reports Results for Full Year 2010
| Completed Merger of Equals with Snyder s of Hanover, Inc. On December 6, 2010 | ||
| Achieves full year Net Revenue of $980 million, a 7% increase over 2009, 5.5% excluding extra week | ||
| Reports 2010 full year earnings per diluted share of $1.09 excluding special items and the impact of the extra week | ||
| Reports 2010 full year earnings per diluted share of $0.07 including special items |
Charlotte, NC, February 18, 2011 Snyders -Lance, Inc. (Nasdaq-GS: LNCE) today reported
results of its fiscal year 2010. Financial results include the
consolidation of Snyders of Hanover, Inc. from the date of the
merger, December 6, 2010. Results for the quarter and full year 2010 reflect consolidated
financials from that date and include a significant amount of special items related to the merger.
The consolidation of Snyders of Hanover, Inc. contributed approximately $49 million in net
revenue for the period, but did not impact EPS as incremental shares issued as a result of the
merger offset the increase in net income.
Net revenues for the consolidated company for the year ended January 1, 2011, were $979.8 million,
an increase of 7% over prior year net revenues of $918.2 million. The Company realized full year
net income of $37.3 million excluding special items and the extra week, or $1.09 per diluted share,
as compared to full year 2009 net income of $35.7 million, excluding special items, or $1.10 per
diluted share. Net income including special items was $2.5 million for the full year 2010 compared
to $35.0 million for 2009. Special items for 2010 included after tax expenses of $1.9
million associated with unsuccessful acquisition costs in the first quarter, $2.0 million
related to a workforce reduction in the second quarter,
$28.2 million associated with the merger with Snyders of
Hanover, Inc., $1.5 million related to an
insurance settlement, and $1.3 million related to the negative impact of the extra week in 2010.
Special items for 2009 after tax expenses of $0.7 million
related primarily to the Stella Doro acquisition.
Consolidated fourth quarter 2010 net revenues were $285.1 million, an increase of 23% (18%
excluding the extra week) compared to prior year fourth quarter net revenues of $231.1 million.
Excluding the impact of the net sales of Snyders, net revenue
was down 3% vs. last year. Fourth quarter 2010 net income was $9.4
million excluding special items as compared to $10.7 million, excluding special items, for the
prior year. Net loss including special items was $19.4 million for the fourth quarter 2010 compared
to fourth quarter 2009 net income including special items of $10.1 million.
Comments from Management
We
are extremely excited about the merger which has created Snyders-Lance, Inc., the most important development in the
history of both companies, commented David V. Singer, Chief
Executive Officer. We have largely completed our integration
plan, including the
transition of company owned routes to independent operators announced earlier this
week, and execution is underway. We have excellent, dedicated people
across all facets of our company and the experience and sense of urgency for our merger integration
is remarkable. We expect to have announced all major organization and integration decisions by the
end of February, at which point we can focus all our attention on executing the integration, and
serving our customers. Although we are excited about the merger, we are
disappointed in our financial results in the fourth quarter. Net Sales were well below our
expectations, which drove lower than anticipated earnings. Now that our organizational
announcements are behind us we are seeing better execution and sales performance. We plan to
complete the vast majority of our integration by mid-2012. This will be a demanding year, but I am
confident in our team to execute the integration and our day to day business so that Snyders-Lance will deliver the benefits that result from the synergies of
the combined businesses.
Insights for 2011 and 2012
We anticipate delivering a portion of our anticipated cost and revenue synergies in the back half
of 2011 but most of our integration plan will not be completed until mid-2012. When synergies are
fully realized, the benefits from integration and sales growth are expected to deliver 2.5% to 3.0%
improvements in operating profit margins compared to 2010 proforma levels of approximately 6.0%.
Through 2012, top line growth is anticipated to be in excess of 5% annualized, before the impact of
conversion to an independent operator model and expected sku rationalization, on a consolidated
proforma 2010 base of $1.58 billion. The growth will be driven by continued investment in our
brands through innovation and advertising as well as expansion of distribution through our new
national DSD network.
Overall 2011 performance is difficult to predict with accuracy as there will be many disruptive
changes which will drive various costs and benefits as we transition to a combined business model.
In addition, with escalating commodity prices, we are faced with significant cost increases that
will require pricing actions beyond those already in place. As a result, the Company will not be
providing specific revenue or EPS guidance for 2011.
Conference Call
Snyders-Lance, Inc. has scheduled a conference call and presentation with investors at 9:00 am
eastern time on Friday, February 18, 2011 to discuss financial results. To participate in the
conference call, the dial-in number is (866) 814-7293 for U.S. callers or (702) 696-4943 for
international callers. A continuous telephone replay of the call will be available between 1:00 pm
on February 18th and midnight on February 25th. The replay telephone number is (800) 642-1687 for
U.S. callers or (706) 645-9291 for international callers. The replay access code is 39931973.
Investors may also access a web-based replay of the conference call
at Snyders-Lances web site, www.lanceinc.com.
The conference call and accompanying slide presentation will be webcast live through the Investor
Relations section of Snyders-Lance, Inc.s website
www.lanceinc.com. In addition, the slide presentation will be available to
download and print approximately 30 minutes before the webcast at
Snyders-Lances Investor Relations home page.
About Snyders-Lance, Inc.
Snyders-Lance, Inc., headquartered in Charlotte, North Carolina, manufactures,
markets and distributes snack foods throughout the United States and internationally.
The companys products include pretzels, sandwich crackers, potato chips, cookies,
tortilla chips, restaurant style crackers, nuts and other snacks. Snyder's-Lance has
manufacturing facilities in North Carolina, Pennsylvania, Iowa, Indiana, Georgia,
Arizona, Massachusetts, Texas, Florida, Ohio, and Ontario, Canada. Products are sold
under the Snyders of Hanover, Lance, Krunchers!, Cape Cod, Jays, Grande, Toms, Archway,
O-Ke-Doke, and Stella Doro brand names along with a number of private label and third party
brands. Products are distributed widely through grocery and mass merchandisers, convenience stores,
club stores, food service outlets and other channels.
This news release contains statements which may be forward looking within the
meaning of applicable securities laws. The statements may include projections
regarding future earnings and results which are based upon the companys current expectations and
assumptions, which are subject to a number of risks and uncertainties. Factors that could cause
actual results to differ include risks and business disruption from merger integration and the conversion of
our distribution to independent operators, general economic conditions, increases in cost or availability of
ingredients, packaging, energy and employees, price competition and industry consolidation, risks from large
customers, ability to execute strategic initiatives, product recalls or safety concerns, disruptions of our supply
chain or information technology systems, changes in consumer preferences, food industry and regulatory factors,
and interest rate and foreign exchange rate risks, as well as those that have been discussed in our most recent
Form 10-K and subsequent Forms 10-Q and other reports filed with the Securities and Exchange Commission
including the form S-4.
SNYDERS -LANCE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except share and per-share amounts)
(unaudited)
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except share and per-share amounts)
(unaudited)
Quarter Ended | Fiscal Year Ended | |||||||||||||||
January 1, | December 26, | January 1, | December 26, | |||||||||||||
2011 | 2009* | 2011 | 2009* | |||||||||||||
Net revenue |
$ | 285,118 | $ | 231,097 | $ | 979,835 | $ | 918,163 | ||||||||
Cost of sales |
182,229 | 138,139 | 601,015 | 549,119 | ||||||||||||
Gross margin |
102,889 | 92,958 | 378,820 | 369,044 | ||||||||||||
Selling, general and administrative |
123,111 | 76,592 | 359,629 | 310,588 | ||||||||||||
Other expense, net |
3,103 | 521 | 7,108 | 1,774 | ||||||||||||
(Loss)/earnings before interest and income
taxes |
(23,325 | ) | 15,845 | 12,083 | 56,682 | |||||||||||
Interest expense, net |
1,358 | 834 | 3,921 | 3,351 | ||||||||||||
(Loss)/income before income taxes |
(24,683 | ) | 15,011 | 8,162 | 53,331 | |||||||||||
Income tax (benefit)/expense |
(5,309 | ) | 4,890 | 5,631 | 18,303 | |||||||||||
Net (loss)/income |
(19,374 | ) | $ | 10,121 | $ | 2,531 | $ | 35,028 | ||||||||
Net income attributable to non-controlling
interests |
19 | | 19 | | ||||||||||||
Net (loss)/income attributable to
Snyders-Lance, Inc. |
$ | (19,393 | ) | $ | 10,121 | $ | 2,512 | $ | 35,028 | |||||||
Basic (loss)/earnings per share |
$ | (0.48 | ) | $ | 0.32 | $ | 0.07 | $ | 1.11 | |||||||
Weighted average shares outstanding
basic |
40,164,000 | 31,683,000 | 34,128,000 | 31,565,000 | ||||||||||||
Diluted (loss)/earnings per share |
$ | (0.48 | ) | $ | 0.31 | $ | 0.07 | $ | 1.08 | |||||||
Weighted average shares outstanding
diluted |
40,164,000 | 32,655,000 | 34,348,000 | 32,384,000 | ||||||||||||
Cash dividends declared per share,
including
special dividend of $3.75 per share in
2010 |
$ | 3.91 | $ | 0.16 | $ | 4.39 | $ | 0.64 |
* | 2009 cost of sales and income tax amounts have been revised to reflect the change in accounting for certain inventories previously on the LIFO method to the FIFO method. |
SNYDERS-LANCE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
January 1, | December 26, | |||||||
2011 | 2009 * | |||||||
ASSETS |
||||||||
Assets: |
||||||||
Cash and cash equivalents |
$ | 27,877 | $ | 5,418 | ||||
Accounts receivable, net of allowances |
128,556 | 87,172 | ||||||
Inventories |
96,936 | 63,873 | ||||||
Other current assets |
70,398 | 26,242 | ||||||
Total current assets |
323,767 | 182,705 | ||||||
Fixed assets, net of accumulated depreciation |
336,673 | 225,981 | ||||||
Goodwill and other intangibles, net |
783,860 | 126,063 | ||||||
Other noncurrent assets |
18,056 | 5,365 | ||||||
Total assets |
$ | 1,462,356 | $ | 540,114 | ||||
LIABILITIES AND STOCKHOLDERS EQUITY |
||||||||
Liabilities and Equity: |
||||||||
Accounts payable |
$ | 39,938 | $ | 29,777 | ||||
Other payables and accrued liabilities |
95,564 | 66,589 | ||||||
Current portion of long-term debt |
57,767 | | ||||||
Total current liabilities |
193,269 | 96,366 | ||||||
Long-term debt |
227,462 | 113,000 | ||||||
Other noncurrent liabilities |
205,010 | 52,238 | ||||||
Stockholders equity |
836,615 | 278,510 | ||||||
Total liabilities and stockholders equity |
$ | 1,462,356 | $ | 540,114 | ||||
* | 2009 inventories, other current assets and stockholders equity amounts have been revised to reflect the change in accounting for certain inventories previously on the LIFO method to the FIFO method. |
SNYDERS-LANCE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
(in thousands)
(unaudited)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
(in thousands)
(unaudited)
Fiscal Year Ended | ||||||||
January 1, | December 26, | |||||||
2011 | 2009 | |||||||
Operating activities |
||||||||
Net income |
$ | 2,531 | $ | 35,028 | ||||
Adjustments to reconcile net income to cash provided by
operating activities: |
||||||||
Depreciation and amortization |
40,100 | 35,211 | ||||||
Stock-based compensation expense |
19,524 | 7,472 | ||||||
Provision for doubtful accounts |
2,649 | 936 | ||||||
Loss on sale of fixed assets |
682 | 702 | ||||||
Impairment of long-lived assets |
584 | | ||||||
Deferred Income Taxes |
18,228 | 2,828 | ||||||
Changes in operating assets and liabilities |
(39,854 | ) | (12,900 | ) | ||||
Net cash provided by operating activities |
44,444 | 69,277 | ||||||
Investing activities |
||||||||
Purchases of fixed assets |
(33,347 | ) | (40,737 | ) | ||||
Proceeds from sale of fixed and intangible assets, and
assets held for sale |
2,731 | 765 | ||||||
Business combinations, net of cash acquired |
96,336 | (23,911 | ) | |||||
Net cash used in investing activities |
65,720 | (63,883 | ) | |||||
Financing activities |
||||||||
Dividends paid |
(142,458 | ) | (20,410 | ) | ||||
Issuances of common stock |
13,102 | 4,240 | ||||||
Repurchases of common stock and net-settlement of
restricted stock units |
(6,519 | ) | (127 | ) | ||||
Proceeds from new credit facilities |
69,000 | | ||||||
Net (repayments)/proceeds on existing credit facilities |
(21,238 | ) | 15,000 | |||||
Net cash used in financing activities |
(88,113 | ) | (1,297 | ) | ||||
Effect of exchange rate changes on cash |
408 | 514 | ||||||
Increase in cash and cash equivalents |
22,459 | 4,611 | ||||||
Cash and cash equivalents at beginning of period |
5,418 | 807 | ||||||
Cash and cash equivalents at end of period |
$ | 27,877 | $ | 5,418 | ||||
Non-cash investing and financing activities: |
||||||||
Common stock and options issued for business acquisitions |
$ | 676,211 | $ | | ||||
Supplemental information: |
||||||||
Cash paid for income taxes, net of refunds of $23 and
$159, respectively |
$ | 12,208 | $ | 13,763 | ||||
Cash paid for interest |
$ | 6,391 | $ | 3,515 |
* | 2009 net income, deferred income taxes and changes in operating assets and liabilities have been revised to reflect the change in accounting for certain inventories previously on the LIFO method to the FIFO method. |
SNYDERS-LANCE, INC.
RECONCILIATION OF NON-GAAP MEASURES
(in thousands, except per-share amounts)
(unaudited)
RECONCILIATION OF NON-GAAP MEASURES
(in thousands, except per-share amounts)
(unaudited)
Quarter Ended January 1, 2011
Per Diluted | ||||||||
Net of Tax | Share | |||||||
Net loss
attributable to Snyders-Lance, Inc. |
$ | (19,393 | ) | $ | (0.48 | ) | ||
Costs related to merger |
25,995 | 0.65 | ||||||
Costs related to insurance settlement |
1,466 | 0.03 | ||||||
Impact of 53rd week |
1,337 | 0.03 | ||||||
Net income, excluding special items * |
$ | 9,405 | $ | 0.23 |
* | Quarter includes $10,079 adjustment for income taxes |
Fiscal Year Ended January 1, 2011
Per Diluted | ||||||||
Net of Tax | Share | |||||||
Net income attributable to Snyders-Lance, Inc. |
$ | 2,512 | $ | 0.07 | ||||
Costs related to merger |
28,162 | 0.83 | ||||||
Costs related to insurance settlement |
1,466 | 0.04 | ||||||
Impact of 53rd week |
1,337 | 0.04 | ||||||
Employee termination costs from
workforce reduction |
1,958 | 0.06 | ||||||
Unsuccessful bid for targeted acquisition |
1,930 | 0.05 | ||||||
Net income, excluding special items ** |
$ | 37,365 | $ | 1.09 |
** | Fiscal year includes $13,076 adjustment for income taxes |
SNYDERS-LANCE, INC.
RECONCILIATION OF NON-GAAP MEASURES
(in thousands, except per-share amounts)
(unaudited)
RECONCILIATION OF NON-GAAP MEASURES
(in thousands, except per-share amounts)
(unaudited)
Quarter Ended December 26, 2009
Per Diluted | ||||||||
Net of Tax | Share | |||||||
Net income attributable to Snyders-Lance, Inc.* |
$ | 10,121 | $ | 0.31 | ||||
Stella Doro integration related charges |
599 | 0.02 | ||||||
Net income, excluding special items |
$ | 10,720 | $ | 0.33 |
Fiscal Year Ended December 26, 2009
Per Diluted | ||||||||
Net of Tax | Share | |||||||
Net income
attributable to Snyders-Lance, Inc. * |
$ | 35,028 | $ | 1.08 | ||||
Stella Doro integration related charges |
747 | 0.02 | ||||||
Net income, excluding special items |
$ | 35,775 | $ | 1.10 |
* | 2009 net income has been revised to reflect the change in accounting for inventory for certain inventories previously on the LIFO method to the FIFO method. |