Del Monte Foods Company Announces Arbitration Ruling.SAN FRANCISCO San Francisco (săn frănsĭs`kō), city (1990 pop. 723,959), coextensive with San Francisco co., W Calif., on the tip of a peninsula between the Pacific Ocean and San Francisco Bay, which are connected by the strait known as the Golden -- Del Monte Foods Del Monte Foods (NYSE: DLM) is an American food production and distribution company based in San Francisco, California. It offers canned goods in Del Monte, S&W and Contadina brands, pet foods under Kibbles n' Bits, 9Lives, Pounce, Milk-Bone and several premium brands, Company (NYSE NYSE See: New York Stock Exchange : DLM See ILM. DLM - Distributed Lock Manager on distributed VMS systems. ) announced today a ruling in an arbitration proceeding with its former logistics services provider, Pacer Global Logistics ("Pacer"). The arbitrator issued a ruling pursuant to which Del Monte will be required to reimburse Pacer for line haul and fuel charge costs incurred on Del Monte's behalf from May 1, 2005 - April 30, 2006 that were above benchmarked rates established in the contract between Del Monte and Pacer, plus interest. The arbitration award An arbitration award (or arbitral award) is a determination on the merits by an arbitration tribunal in an arbitration, and is analogous to a judgment in a court of law. is expected to negatively impact fiscal 2007 earnings per share from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the ("EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. ") and cash flow by approximately $0.02 per share and $6 million, respectively. The EPS and cash flow impact, relative to this arbitration decision, reflects the amounts by which the award exceeded the accrual the Company previously recorded to cover liability in the matter, and was not included in the $0.50 to $0.53 EPS and $150 to $170 million cash flow guidance ranges for fiscal 2007 that the Company provided on its March 1, 2007 third quarter earnings call. Del Monte Foods Del Monte Foods is one of the country's largest and most well known producers, distributors and marketers of premium quality, branded food and pet products for the U.S. retail market, generating approximately $3 billion in net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight in fiscal 2006. With a powerful portfolio of brands including Del Monte([R]), StarKist([R]), S&W([R]), Contadina([R]), College Inn([R]), Meow Mix([R]), Kibbles 'n Bits Kibbles 'n Bits is a brand name of dog food manufactured and marketed by Del Monte Foods. It was originally created in 1981 as the first dual textured dog food, having soft chewy pieces as well as hard crunchy ones. In 1995, the brand was acquired by Del Monte. ([R]), 9Lives([R]),Milk-Bone([R]), Pup-Peroni([R]), Meaty Bone([R]), Snausages([R]) and Pounce([R]), Del Monte products are found in nine out of ten American households. The Company also produces, distributes and markets private label food and pet products. For more information on Del Monte Foods Company (NYSE:DLM) visit the Company's website at www.delmonte.com. Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. This press release contains forward-looking statements conveying management's expectations as to the future based on plans, estimates and projections at the time the Company makes the statements. Forward-looking statements involve inherent risks and uncertainties and the Company cautions you that a number of important factors could cause actual results to differ materially from those contained in any such forward-looking statement. The forward-looking statements contained in this press release include statements related to future financial operating results, including the expected impact of the Pacer arbitration decision on the Company's fiscal 2007 earnings per share and cash flow, including any future decision by the arbitrator regarding Pacer's still-outstanding request for attorneys' fees and costs. Factors that could cause actual results to differ materially from those described in this press release include, among others: general economic and business conditions; final costs related to the integration of the Meow Mix and Milk-Bone businesses; cost and availability of inputs, commodities, ingredients and other raw materials, including without limitation, energy, fuel, packaging, grains (including corn), meat by-products and tuna; logistics and other transportation-related costs; our debt levels and ability to service and reduce our debt; efforts and ability to increase prices and reduce costs; costs and results of efforts to improve the performance and market share of our businesses; reduced sales, disruptions, costs or other charges to earnings that may be generated by our strategic plan and transformation plan efforts; effectiveness of marketing, pricing and trade promotion programs; changes in U.S., foreign or local tax laws and effective rates; changing consumer and pet preferences; timely launch and market acceptance of new products; competition, including pricing and promotional spending levels by competitors; acquisitions, if any, including identification of appropriate targets and successful integration of any acquired businesses; product liability claims; weather conditions; crop yields; interest rate fluctuations; the loss of significant customers or a substantial reduction in orders from these customers or the bankruptcy of any such customer; changes in business strategy or development plans; availability, terms and deployment of capital; increased pension funding obligations; dependence on co-packers, some of whom may be competitors or sole-source suppliers; changes in, or the failure or inability to comply with, U.S., foreign and local governmental regulations, including environmental regulations and import/export duties; litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. ; industry trends, including changes in buying, inventory and other business practices by customers; public safety and health issues; and other factors. These factors and other risks and uncertainties are described in more detail, from time to time, in the Company's filings with the Securities and Exchange Commission, including its annual report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. and most recent quarterly report on Form 10-Q Form 10-Q See 10-Q. . Investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company does not undertake to update any of these statements in light of new information or future events. |
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