Del Monte Foods Company Reports Fiscal 2005 Third Quarter Results; Delivers Strong Revenue Growth of 6.2%.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. ) today reported diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of of $0.23 for the third quarter ended January January: see month. 30, 2005, compared to $0.25 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. 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 for the prior year period. Integration costs of $3.2 million ($0.01 per share) and $7.2 million ($0.02 per share) are included in the results for the third quarter of fiscal 2005 and fiscal 2004, respectively. 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 increased 6.2% from the prior year period to $861.3 million. The sales increase was driven by higher volume from new product introductions and increased marketing support, as well as by increased pricing. Sales increased across each of Del Monte's operating segments (Del Monte Monte (Italian, Portuguese and Spanish meaning mount) may refer to various things: Monte is the name of several places: In Brazil
Income from continuing operations decreased to $48.6 million for the quarter from $52.2 million a year ago due to increased inflationary in·fla·tion·ar·y adj. Of, associated with, or tending to cause inflation: inflationary prices; inflationary policies. Adj. 1. costs in steel and energy, logistics logistics In military science, all the activities of armed-force units in support of combat units, including transport, supply, communications, and medical aid. The term, first used by Henri Jomini, Alfred Thayer Mahan, and others, was adopted by the U.S. and other transportation-related costs, as well as due to higher fish costs. Marketing spending also increased, as Del Monte continued to invest in its brands and new products. These higher costs were partially offset by increased pricing, cost reduction actions, lower overhead expenses, higher volume and lower interest expense. "We continued to benefit from pricing actions taken over the last several quarters," said Richard Ri·chard , Joseph Henri Maurice Known as "Rocket." 1921-2000. Canadian hockey player. A right wing for the Montreal Canadiens (1942-1960), he led his team to eight Stanley Cup championships and was the first player to score 50 goals in a G. Wolford Wolford, located in Austria, is a marketer and manufacturer of hosiery and lingerie. In the late 1990s, it ran a famous campaign featuring the work of Helmut Newton. External links
"During the quarter, we continued to experience higher costs driven primarily by inflationary pressures. Earlier in the year, we fielded pricing actions and cost reduction programs and, during the quarter, continued to implement initiatives to address these pressures. While we anticipate this difficult cost environment is likely to persist over the next 12 to 18 months, over the longer term we believe actions we are taking will fortify for·ti·fy v. for·ti·fied, for·ti·fy·ing, for·ti·fies v.tr. To make strong, as: a. To strengthen and secure (a position) with fortifications. b. To reinforce by adding material. our brands, expand our product line through innovation and reduce our operating costs operating costs npl → gastos mpl operacionales . This will result in Del Monte emerging from this difficult environment stronger and better positioned." Nine Months Ended January 30, 2005 The Company reported diluted earnings per share of $0.47 for the nine months ended January 30, 2005, compared to $0.50 per diluted share from continuing operations for the prior year period. Integration costs of $16.0 million ($0.05 per share) and $21.0 million ($0.07 per share) are included in the results for the first nine months of fiscal 2005 and fiscal 2004, respectively. Net sales increased 5.4% from the first nine months of fiscal 2004 to $2,333.9 million, driven by higher volume from new product introductions and increased marketing support, as well as increased pricing. Income from continuing operations was $99.0 million for the first nine months of fiscal 2005 versus $106.4 million a year ago. This decrease in income was driven by the increased inflationary costs and the strategic decision to invest in marketing. The Company was able to partially offset this decrease by increased pricing and higher volume, lower corporate expenses and lower interest expense. Other Events The Company recently completed a refinancing Refinancing An extension and/or increase in amount of existing debt. which included the successful tender for approximately $297 million of its $300 million principal amount 9 1/4% senior subordinated Subordinated A claim ranked lower in priority than other claims. Common stock claims are always subordinated to debt. notes, the issuance of $250 million of new 6 3/4% senior subordinated notes and the establishment of a new credit facility, including $600 million of term loans and a new increased $350 million working capital revolver revolver: see small arms. revolver Pistol with a revolving cylinder that provides multishot action. Some early versions, known as pepperboxes, had several barrels, but as early as the 17th century pistols were being made with a revolving chamber to . The result of the refinancing will be reduced interest rates on our notes, reduced interest spreads on our floating rate debt, improved financial flexibility and extended maturities. Refinancing fees and expenses totaled approximately $40 million, primarily due to approximately $33 million of consideration paid in connection with the note tender. In the fourth quarter, 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. impact of the fees and write-offs associated with the refinancing is preliminarily estimated to be $0.11 per diluted share. Mr. Wolford noted, "The refinancing was a successfully executed transaction that increases our overall financial flexibility. We believe it is an important investment in our future." In addition, on March 2, 2005, a jury reached a verdict on the Mars Mars, in Roman religion and mythology Mars, in Roman religion and mythology, god of war. In early Roman times he was a god of agriculture, but in later religion (when he was identified with the Greek Ares) he was primarily associated with war. Kal-Kan 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. . Kal-Kan Inc., which was a subsidiary of Mars, Inc., sued the H.J. Heinz Company on December December: see month. 19, 2001 alleging infringement The encroachment, breach, or violation of a right, law, regulation, or contract. The term is most frequently used in reference to the invasion of rights secured by Copyright, patent, or trademark. of one of its patents. Del Monte assumed defense of this litigation in December 2002 when Del Monte acquired rights to the Heinz U.S. pet food business. The trial on this matter began on February February: see month. 22. The jury awarded Mars damages of $3.6 million and Del Monte is considering an appeal. This award resulted in a $0.01 per share negative impact for the third quarter. Outlook For fiscal 2005, the Company expects sales growth of approximately 2% to 3% over fiscal 2004 net sales of $3,129.9 million. Excluding the impact of the 53rd week in fiscal 2004, the Company expects sales growth of approximately 4% to 5%. Diluted earnings per share from continuing operations is expected to be $0.65 to $0.70. This includes integration expense of approximately $0.06 per share and $0.11 of refinancing fees and write-offs. The Company reported $0.76 of diluted earnings per share from continuing operations in fiscal 2004, which included integration expense of $0.13 per share and the impact of the 53rd week of approximately $0.03 per share. The Company expects cash provided by operating activities, less cash used in investing activities, of approximately $185 to $200 million in fiscal 2005. For the fiscal 2005 fourth quarter, the Company expects sales to decline approximately 4% to 6% versus net sales of $915.9 million in the fourth quarter of fiscal 2004 primarily driven by the absence of the 53rd week in the fourth quarter of fiscal 2005. Excluding the impact of the 53rd week, the Company expects sales growth of 1% to 3%. Diluted earnings per share is expected to be approximately $0.18 to $0.23. This includes integration expense of approximately $0.01 per share and $0.11 per share in refinancing fees and write-offs. The Company reported $0.26 from continuing operations for the fourth quarter of fiscal 2004, which included integration expense of $0.06 per share and the impact of the 53rd week of approximately $0.03 per share. Del Monte Foods Del Monte Foods is one of the country's largest and most well-known well-known adj. 1. Widely known; familiar or famous: a well-known performer. 2. Fully known: well-known facts. producers, distributors and marketers of premium quality, branded and private label food and pet products for the U.S. retail market, generating over $3 billion in net sales in fiscal 2004. With a powerful portfolio of brands including Del Monte(R), Contadina(R), StarKist(R), S&W(R), Nature's Goodness(TM), College Inn(R), 9Lives(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), Pup-Peroni(R), Snausages Snausages are a dog treat of small pieces that resemble miniature "pigs in blankets" (in the American sense of sausages wrapped in dough). They come in several different flavors, including "bacon and cheese" and "beef and cheese". (R), and NawSomes! (R), Del Monte products are found in nine out of ten American American, river, 30 mi (48 km) long, rising in N central Calif. in the Sierra Nevada and flowing SW into the Sacramento River at Sacramento. The discovery of gold at Sutter's Mill (see Sutter, John Augustus) along the river in 1848 led to the California gold rush of households. For more information on Del Monte Foods Company, visit the Company's Web site at www.delmonte.com. Del Monte Foods will host a live audio web cast, accompanied ac·com·pa·ny v. ac·com·pa·nied, ac·com·pa·ny·ing, ac·com·pa·nies v.tr. 1. To be or go with as a companion. 2. by a slide presentation, to discuss its fiscal 2005 Third Quarter results at 8:00 a.m. PDT PDT abbr. Pacific Daylight Time PDT Pacific Daylight Time PDT n abbr (US) (= Pacific Daylight Time) → hora de verano del Pacífico PDT (11:00 a.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT ) today. The web cast slide presentation, and historical, quarterly results can be accessed at www.delmonte.com/company/investors. The web cast and slide presentation will be available online following the presentation. This press release contains 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. 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 and business plans. Factors that could cause actual results to differ materially from those described in this press release include, among others: general economic and business conditions; cost and availability of commodities, ingredients and other raw materials, including without limitation, steel, grains, meat by-products Meat by-products are ground and cleaned slaughtered meat carcass parts such as necks, feet, undeveloped eggs, bones, heads, and intestines (and a small amount of feathers in the case of chicken meat). , tuna tuna or tunny, game and food fishes, the largest members of the family Scombridae (mackerel family) and closely related to the albacore and bonito. They have streamlined bodies with two fins, and five or more finlets on the back. and energy, logistics and other transportation-related costs; ability to increase prices and reduce costs; high leverage and ability to service and reduce our debt; costs and results of efforts to improve the performance and market share of the businesses we acquired from Heinz; effectiveness of marketing and trade promotion programs; changing consumer and pet preferences; timely launch and market acceptance of new products; implementation of our trade promotion spending improvement project and of our distribution network improvement project; competition, including pricing and promotional spending levels by competitors; transportation costs; insurance coverage; product liability claims; weather conditions; crop yields; changes in U.S., foreign or local tax laws and rates; foreign currency exchange and interest rate fluctuations; the loss of significant customers or a substantial reduction in orders from these customers or the bankruptcy bankruptcy, in law, settlement of the liabilities of a person or organization wholly or partially unable to meet financial obligations. The purposes are to distribute, through a court-appointed receiver, the bankrupt's assets equitably among creditors and, in most of any such customers; acquisitions, including identification of appropriate targets and successful integration of any acquired business; changes in business strategy or development plans; availability, terms and deployment of capital; 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; 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. for the fiscal year ended May 2, 2004. Investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" . The Company does not undertake to update any of these statements in light of new information or future events.
Del Monte Foods Company - Selected Financial Results
Net Sales by Segment
(In millions)
Three Months Ended Nine Months Ended
----------------------- -----------------------
January 30, January 25, January 30, January 25,
2005 2004 2005 2004
----------- ----------- ----------- -----------
Net Sales:
Consumer Products $638.3 $608.8 $1,714.4 $1,657.2
Pet Products 223.0 202.3 619.5 556.8
----------- ----------- ----------- -----------
Total Company $861.3 $811.1 $2,333.9 $2,214.0
=========== =========== =========== ===========
Operating Income by Segment
(In millions)
Three Months Ended Nine Months Ended
----------------------- -----------------------
January 30, January 25, January 30, January 25,
2005 2004 2005 2004
----------- ----------- ----------- -----------
Operating Income:
Consumer Products $74.2 $78.7 $183.3 $177.2
Pet Products 37.8 44.4 86.1 105.2
Corporate (a) (7.6) (8.0) (30.8) (24.3)
----------- ----------- ----------- -----------
Total Company $104.4 $115.1 $238.6 $258.1
=========== =========== =========== ===========
(a) Corporate represents expenses not directly attributable to
reportable segments.
Selected Balance Sheet Data
(In millions)
January 30, May 2,
2005 2004
----------- -----------
Cash and cash equivalents $8.6 $36.3
Trade accounts receivable, net of allowance 228.0 222.3
Inventories 1,000.6 823.5
Total assets 3,579.5 3,459.7
Accounts payable and accrued expenses 401.3 427.2
Short-term borrowings 14.9 0.8
Long-term debt, including current portion 1,370.2 1,375.8
Stockholders' equity 1,243.5 1,128.9
Selected Cash Flow Data
(In millions)
Nine Months Ended
------------------------
January 30, January 25,
2005 2004
----------- -----------
Net cash provided by (used in) operating
activities $(5.4) $2.6
Net cash used in investing activities (41.2) (58.2)
----------- -----------
Total (46.6) (55.6)
Net cash provided by financing activities 17.4 29.4
Depreciation and amortization 68.2 64.7
Other Financial Data
(In millions)
January 30, January 25,
2005 2004
----------- -----------
Short-term borrowings $14.9 $34.9
Current portion of long-term debt 6.3 24.1
Long-term debt (excluding current portion) 1,363.9 1,623.1
----------- -----------
Total Debt $1,385.1 $1,682.1
=========== ===========
DEL MONTE FOODS COMPANY
Condensed Consolidated Statements of Income
(In millions, except share and per share data)
Three Months Ended Nine Months Ended
------------------------- -------------------------
January 30, January 25, January 30, January 25,
2005 2004 2005 2004
------------ ------------ ------------ ------------
Net sales $861.3 $811.1 $2,333.9 $2,214.0
Cost of products
sold 629.1 583.9 1,732.5 1,621.1
------------ ------------ ------------ ------------
Gross profit 232.2 227.2 601.4 592.9
Selling, general
and administrative
expense 127.8 112.1 362.8 334.8
------------ ------------ ------------ ------------
Operating income 104.4 115.1 238.6 258.1
Interest expense 25.9 31.4 76.4 92.3
Other income
(expense) (0.1) 0.5 (2.6) 2.1
------------ ------------ ------------ ------------
Income from
continuing
operations
before income
taxes 78.4 84.2 159.6 167.9
Provision for
income taxes 29.8 32.0 60.6 61.5
------------ ------------ ------------ ------------
Income from
continuing
operations 48.6 52.2 99.0 106.4
Income (loss)
from
discontinued
operations
before income
taxes - 3.4 (0.7) 4.9
Provision
(benefit) for
income taxes 0.1 2.1 (0.3) 3.3
------------ ------------ ------------ ------------
Income (loss)
from
discontinued
operations (0.1) 1.3 (0.4) 1.6
------------ ------------ ------------ ------------
Net income $48.5 $53.5 $98.6 $108.0
============ ============ ============ ============
Earnings per common
share
Basic:
Basic Average
Shares 210,956,990 209,584,143 210,329,324 209,469,808
EPS - Continuing
Operations $0.23 $0.25 $0.47 $0.51
EPS -
Discontinued
Operations - 0.01 - 0.01
------------ ------------ ------------ ------------
EPS - Total $0.23 $0.26 $0.47 $0.52
============ ============ ============ ============
Diluted:
Diluted Average
Shares 212,708,244 211,468,686 212,155,196 210,866,764
EPS - Continuing
Operations $0.23 $0.25 $0.47 $0.50
EPS -
Discontinued
Operations - - - 0.01
------------ ------------ ------------ ------------
EPS - Total $0.23 $0.25 $0.47 $0.51
============ ============ ============ ============
|
|
||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion