Del Monte Foods Company Reports Fiscal 2007 Fourth Quarter and Full Year Results.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. ): Announcement Highlights * Reported fourth quarter 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 growth of 17.6% and 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. 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. 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 of $0.18 (includes $0.04 for transformation and integration) compared to $0.21 in Q4F Q4F Quake 4 Fortress (gaming) 06. * Reported full year 2007 net sales growth of 13.9% and diluted EPS from continuing operations of $0.55 (includes $0.19 for transformation, integration and purchase accounting) compared to $0.67 in F06. * Announces F08 guidance. Expects net sales growth of 5% to 7% over F07 sales of $3.4 billion and diluted EPS from continuing operations of $0.70-$0.74 (including $0.08 for transformation) compared to F07 of $0.55 (which included $0.19 for transformation, integration and purchase accounting). Del Monte Foods Fourth Quarter Results Del Monte Foods today reported net sales for the fourth quarter fiscal 2007 of $940.1 million compared to $799.2 million last year, an increase of 17.6%. Income from continuing operations was $36.8 million, or $0.18 EPS, compared to $41.7 million, or $0.21 EPS in the previous year. Results for fourth quarter fiscal 2007 included $0.03 of transformation-related expenses and $0.01 of integration expense. "This quarter and full year's solid financial performance were driven by the ongoing successful execution against our strategic objectives," 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
Monte is the name of several places: In Brazil
adj. Of, associated with, or tending to cause inflation: inflationary prices; inflationary policies. Adj. 1. cost pressures during the year and going forward. We are extremely pleased with the performance of the pet acquisitions, which continue to exceed expectations. Overall, we continued our solid track record of generating strong cash flow well ahead of our fiscal 2007 guidance. We still however must deal with challenges, including inflationary cost pressures and our StarKist Seafood business. Despite these ongoing headwinds, we believe we have the foundation in place to deliver strong F08 performance." The 17.6% increase in net sales was driven by the acquisitions of Meow Mix and Milk-Bone. Growth from new products and pricing also contributed to the increase in net sales. These gains were partially offset by volume declines. Fourth quarter EPS from continuing operations of $0.18 was down $0.03, which included the impact of the $0.04 of transformation-related expenses and integration expense mentioned above. Pricing actions and recent pet acquisitions (net of related interest expense) favorably fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. impacted EPS. Partially offsetting these gains were higher costs, lower volume and higher trade spending. Reportable Segments - Fourth Quarter Results Consumer Products For the fourth quarter, Consumer Products net sales were $594.9 million, an increase of 3.7% from net sales of $573.4 million in the prior year period. Del Monte Brands net sales increased by 6.8%, due primarily to an increase in fruit sales, resulting mainly from positive pricing actions and increased sales and distribution in new products including Del Monte Fruit Naturals, Del Monte No Sugar Added Fruit, and Del Monte Fruit Chillers as well as opportunistic opportunistic /op·por·tu·nis·tic/ (op?er-tldbomacn-is´tik) 1. denoting a microorganism which does not ordinarily cause disease but becomes pathogenic under certain circumstances. 2. volume in low-margin, non-grocery channels. StarKist Seafood business performance continued to decline, as net sales decreased by 4.2% primarily due to lower volume resulting from pricing and other factors. Consumer Products operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. decreased 33.0% from $59.1 million in the fourth quarter fiscal 2006 to $39.6 million in the fourth quarter fiscal 2007. In Del Monte Brands, pricing actions largely covered expected inflationary and other operational costs (including logistics and raw product). However, additional costs including higher trade spending and the impact of the Pacer arbitration arbitration Process of resolving a dispute or a grievance outside a court system by presenting it for decision to an impartial third party. Both sides in the dispute usually must agree in advance to the choice of arbitrator and certify that they will abide by the decision in fourth quarter fiscal 2007 contributed to the decline in Consumer Products operating income. In StarKist Seafood, higher inflationary and other operational costs (including fish) and lower volume across the business negatively impacted Consumer Products operating income. Pet Products For the fourth quarter, Pet Products net sales were $345.2 million, an increase of 52.9% over net sales of $225.8 million in the prior year period. The increase was driven by the Meow Mix and Milk-Bone acquisitions. Growth from new pet products, including 9Lives Daily Essentials, 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. Brushing Bites and Pup-Peroni Ribs, as well as pricing also positively contributed to the increase in net sales. These gains were partially offset by lower volume driven primarily by reduced volume from the pet recall largely involving low-margin products, as well as from a shift in promotional timing on pet snacks from Q4 to Q3 fiscal 2007, and competitive marketing dynamics in dry dog. Pet Products operating income increased 61.8% from $41.1 million in fourth quarter fiscal 2006 to $66.5 million in fourth quarter fiscal 2007. The increase reflected the positive impact of the Meow Mix and Milk-Bone acquisitions net of integration expense. Pricing was also a positive contributor. Partially offsetting these positive factors were the negative impact of lower volume driven by the factors mentioned above, as well as higher raw product costs related to the recent ethanol-related cost escalation es·ca·late v. es·ca·lat·ed, es·ca·lat·ing, es·ca·lates v.tr. To increase, enlarge, or intensify: escalated the hostilities in the Persian Gulf. v.intr. . Del Monte Foods Full Year Ended April 29, 2007 Results The Company reported net sales for fiscal 2007 of $3,414.9 million compared to $2,998.6 million last year, an increase of 13.9%. Income from continuing operations was $113.0 million, or $0.55 EPS, compared to $137.0 million, or $0.67 EPS in the previous year. Results for fiscal 2007 included $0.11 of transformation-related expenses, $0.04 of integration expense, and $0.04 of purchase accounting impact. The 13.9% increase in net sales was driven by the Meow Mix and Milk-Bone acquisitions. Growth from new products and pricing also contributed to the increase in net sales. These gains were partially offset by lower volume driven primarily by competitive marketing dynamics and elasticity in pet food, pricing elasticity in the Consumer Products business, overall business performance in StarKist Seafood and lower volume in vegetables (primarily resulting from the loss of volume from the sale of a perpetual PERPETUAL. That which is to last without limitation as to time; as, a perpetual statute, which is one without limit as to time, although not expressed to be so. license for S&W beans See JavaBeans. ). EPS from continuing operations of $0.55 was down $0.12, which included the impact of $0.19 of transformation-related expense, purchase accounting, and integration expense mentioned above. Pricing actions and the pet acquisitions (net of related interest expense) and lower taxes favorably impacted EPS. Partially offsetting these gains were higher costs, lower volume, higher interest expense, and higher trade spending. [TABLE OMITTED] Outlook First Quarter Fiscal 2008 For the fiscal 2008 first quarter, the Company expects to deliver sales growth of approximately 5% to 7% over net sales of $674.1 million in the first quarter of fiscal 2007. Diluted EPS from continuing operations is expected to be approximately $(0.02) to $0.02, including $0.01 of transformation-related expenses, as compared to $0.04 in the first quarter of fiscal 2007, which included $0.05 of transformation-related expense, purchase accounting impact, and integration expense.
Factors Impacting Guidance
Q1E
Fiscal 2008 ($0.02) - $0.02
Includes:
Q1F08 Transformation-related expenses ($0.01)
Q1F08 Integration expense -
Q1F08 Purchase accounting impact -
Q1A
Fiscal 2007 $0.04
Includes:
Q1F07 Transformation-related expenses ($0.03)
Q1F07 Integration expense ($0.01)
Q1F07 Purchase accounting impact ($0.01)
Fiscal 2008 For fiscal 2008, the Company expects sales growth of 5% to 7% over fiscal 2007 net sales of $3,414.9 million. Fiscal 2008 net sales growth is expected to be driven primarily by growth across the Company's portfolio, in particular the Meow Mix and Milk-Bone acquisitions. During the fourth quarter, the Company announced additional pricing actions effective April 30, 2007 in Pet Products in response to higher raw ingredient costs related to the demand for ethanol ethanol (ĕth`ənōl') or ethyl alcohol, CH3CH2OH, a colorless liquid with characteristic odor and taste; commonly called grain alcohol or simply alcohol. . The Company expects fiscal 2008 diluted EPS from continuing operations to be $0.70 to $0.74, including $0.08 of transformation-related expenses. The Company reported $0.55 diluted EPS from continuing operations in fiscal 2007, which included $0.19 of transformation-related expense, purchase accounting impact and integration expense.
Factors Impacting Guidance
Full Year
F08E F07A
$0.70-$0.74 $0.55
Includes:
Transformation-related expenses ($0.08) ($0.11)
Integration expense - ($0.04)
Purchase accounting impact - ($0.04)
In fiscal 2008, the Company expects cash provided by operating activities, less cash used in investing activities to be approximately $180 to $200 million. This compares to $(1,114.7) million in fiscal 2007, which included $1,310.6 million of cash used in the acquisitions of Meow Mix and Milk-Bone. Our adjusted cash flow1 in fiscal 2007 was $195.9 million, which compares favorably to our fiscal 2007 guidance of $150 to $170 million, both of which excluded the purchase of Meow Mix and Milk-Bone. [TABLE OMITTED] 1 Cash provided by operating activities, less cash used in investing activities plus cash used in the acquisitions of Meow Mix and Milk-Bone. [TABLE OMITTED] Webcast Information Del Monte Foods will host a live audio webcast, accompanied by a slide presentation, to discuss its fiscal 2007 fourth quarter and full year results and outlook at 7:00 a.m. PT (10:00 a.m. ET) today. To access the live webcast and slides, go to www.delmonte.com, click on the Investor Tab and under Events click Q4 and Full Year 2007 Del Monte Foods Earnings Conference Call. Printable print·a·ble adj. 1. Capable of being printed or of producing a print: printable negatives. 2. Fit for publication: printable language. slides are expected to be available in advance of the call. Historical, quarterly results can be accessed at http://investors.delmonte.com. The audio portion of the webcast may also be accessed during the call (listen-only mode) as follows: 1- 888-788-9432 (1-210-795-9068 outside the U.S. and Canada), verbal code: Del Monte Foods. The webcast and slide presentation will be available online following the presentation. 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 $3.4 billion in net sales in fiscal 2007. 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([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. Non-GAAP Financial Measures Del Monte Foods Company reports its financial results in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. (GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ). In this press release and the accompanying webcast, Del Monte is also providing certain non-GAAP financial measures. The non-GAAP cash flow measures that the Company is using to compare its fiscal 2008 guidance to its fiscal 2007 results exclude cash used in the acquisitions of Meow Mix and Milk-Bone. Del Monte uses this non-GAAP financial measure internally to benchmark its performance against the guidance it provided for fiscal 2007, which had not included the cash used in the acquisitions of Meow Mix and Milk-Bone, and believes this information is also helpful to investors. When looking internally at year-over-year changes in cash flow, the Company generally excludes the cash used in or provided by large acquisitions or divestitures, such as the fiscal 2007 acquisitions of Meow Mix and Milk-Bone and the fiscal 2006 divestiture The breakup of AT&T. By federal court order, AT&T divested itself on January 1, 1984 of its 23 operating companies, which became known as the Regional Bell Operating Companies (RBOCs). of its soup and infant feeding businesses, and it provided fiscal 2007 guidance on the same basis. The Company cautions investors that the non-GAAP financial measures presented are intended to supplement the Company's GAAP results and are not a substitute for such results. Additionally, the non-GAAP financial measures used by Del Monte may differ from non-GAAP measures used by other companies. 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 costs of the transformation plan, as well as to the Company's long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. potential and competitiveness. 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 inputs, commodities, ingredients and other raw materials, including without limitation, energy (including natural gas), fuel, packaging, grains (including corn), 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). and 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. ; the accuracy of our assumptions regarding costs and other matters; our ability to increase prices and manage the price gap between our products and competing private label products, our ability to reduce costs; logistics and other transportation-related costs; our recent pet food and pet snacks recall or other product recalls; our debt levels and ability to service and reduce our debt; reduced sales, disruptions, costs or other charges to earnings or expenses that may be generated by our strategic plan and transformation plan efforts; timely launch and market acceptance of new products; competition, including pricing and promotional spending levels by competitors; efforts to improve the performance and market share of our businesses; changes in U.S., foreign or local tax laws and effective rates; effectiveness of marketing and trade promotion programs; changing consumer and pet preferences; 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 customer; availability, terms and deployment of capital; interest rate fluctuations; reliance on third-parties, including co-packers, our broker and third-party distribution centers or managers; product liability claims and other 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. ; acquisitions, if any, including identification of appropriate targets and successful integration of any acquired businesses; weather conditions; crop yields; any acceleration of our departure from Terminal Island, CA; changes in, or the failure or inability to comply with, U.S., foreign and local governmental regulations, including environmental regulations and import/export regulations or duties; wage rates; 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 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. Our declaration of future dividends, if any, is subject to final determination by our Board of Directors each quarter after its review of our then-current strategy, applicable debt covenants, and financial performance and position, among other things. [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] |
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