Del Monte Foods Company Reports Fiscal 2007 Second Quarter 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 * Pet acquisitions, pricing actions and growth from new products drove Q2 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 12.6%. * Reported 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 $0.12 in Q2F07 (includes $0.06 for transformation, integration, and purchase accounting) compared to $0.18 in Q2F06; reflects impact from pet acquisitions, pricing actions, and inflationary in·fla·tion·ar·y adj. Of, associated with, or tending to cause inflation: inflationary prices; inflationary policies. Adj. 1. and other operational cost increases. * Now expects F07 sales growth of 12% to 15% over F06 (compared to original guidance of 14% to 16%). Continues to expect diluted EPS from continuing operations of $0.48 to $0.53 (includes $0.22 to $0.25 for transformation, integration, and purchase accounting). Del Monte Foods Second Quarter Results Del Monte Foods today reported net sales for the second quarter of fiscal 2007 of $893.5 million compared to $793.2 million last year, an increase of 12.6%. Income from continuing operations was $23.7 million, or $0.12 EPS, compared to $37.3 million, or $0.18 EPS in the previous year. Results for second quarter fiscal 2007 included $0.03 of transformation-related expenses, $0.02 of integration expense, and $0.01 of purchase accounting impact. "This quarter's results were driven by strong performance in our acquired pet businesses, continued brand-driven pricing actions, new product introductions, and aggressive cost-reduction programs in the face of ongoing exogenous Exogenous Describes facts outside the control of the firm. Converse of endogenous. cost pressures," 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
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. growth in our Pet Products business, enabled by the successful integration of our new Milk-Bone Milk-Bone is a brand of dog treat. It was created in 1908 by the F. H. Bennett Biscuit Company, which operated a bakery on the Lower East Side of New York City. Originally named Maltoid, the biscuit was a bone-shaped treat made from minerals, meat products, and milk. and Meow Mix businesses, as well as new product growth. Our Consumer Products business was adversely impacted this quarter by increased costs and pricing-related reduced volume in lower margin products. We are pleased with our first half EPS performance and expect our second half performance to improve as we realize the full benefits of our pricing actions and execute against our initiatives. Importantly, the strategic steps we are taking, including the execution of our transformation plan and the successful integration of our acquisitions, are progressing as expected and, we believe, will drive improved ongoing performance." The 12.6% increase in net sales was driven primarily by the acquisitions of Meow Mix and Milk-Bone. Increased growth from new products and net pricing also contributed to the increase in net sales. These gains were partially offset by a volume decline, as discussed below. The decrease in EPS from continuing operations was driven primarily by the $0.06 of transformation-related expenses, integration expense and purchase accounting impact mentioned above. Pet acquisitions (net of related interest expense) and the initial impact of recent pricing actions were positive contributors during the quarter. These factors were partially offset by increased costs, including raw product costs and steel and other packaging costs. Lower volume, higher marketing expense, and higher interest expense also impacted EPS negatively. Reportable Segments - Second Quarter Results Consumer Products For the second quarter, Consumer Products net sales were $566.5 million, a decrease of 3.1% from net sales of $584.4 million in the prior year period. Del Monte Monte (Italian, Portuguese and Spanish meaning mount) may refer to various things: Monte is the name of several places: In Brazil
Consumer Products operating income decreased 17.4% from $63.7 million in second quarter fiscal 2006 to $52.6 million in second quarter fiscal 2007. The decrease primarily reflected higher costs, including fish, peach peach, fruit tree (Prunus persica) of the family Rosaceae (rose family) having decorative pink blossoms and a juicy, sweet drupe fruit. The peach appears to have originated in China, where it was mentioned in literature several centuries before Christ. and tomato raw product costs and steel and other packaging costs, combined with the lower volume explained above. These factors were partially offset by positive net pricing actions, including pricing in tomatoes, fruit and seafood which are anticipated to be more fully realized in the second half of fiscal 2007. Pet Products For the second quarter, Pet Products net sales were $327.0 million, an increase of 56.6% over net sales of $208.8 million in the prior year period. The increase was primarily driven by the Meow Mix and Milk-Bone acquisitions. Growth from new pet products and net pricing also positively contributed to the increase in net sales. These gains were partially offset by lower volume due to competitive marketing dynamics and elasticity. Pet Products operating income increased 65.2% from $32.5 million in second quarter fiscal 2006 to $53.7 million in second quarter fiscal 2007. The increase primarily reflected the positive impact of the Meow Mix and Milk-Bone acquisitions net of integration expense and purchase accounting impact. Marketing expense was higher in second quarter fiscal 2007 compared to prior year driven by marketing associated with new pet product introductions. Del Monte Foods Six Months Ended October October: see month. 29, 2006 Results The Company reported net sales for the first half of fiscal 2007 of $1,567.6 million compared to $1,409.8 million last year, an increase of 11.2%. Income from continuing operations was $31.1 million, or $0.15 EPS, compared to $50.1 million, or $0.24 EPS in the previous year. Results for the first half of fiscal 2007 included $0.06 of transformation-related expenses, $0.03 of integration expense, and $0.02 of purchase accounting impact. The 11.2% increase in net sales was driven primarily by the acquisitions of Meow Mix and Milk-Bone. Increased growth from new products and net pricing also contributed to the increase in net sales. These gains were partially offset by a volume decline, driven by many of the same factors which impacted the second quarter fiscal 2007 results. The decrease in EPS from continuing operations was driven primarily by the $0.11 of transformation-related expenses, integration expense, and purchase accounting impact mentioned above. Pet acquisitions (net of related interest expense), pricing actions and the $0.03 gain on 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 (closed first quarter fiscal 2007) were positive contributors during the first half of the fiscal year. These factors were partially offset by increased costs, including raw product costs, steel and other packaging costs, and energy-related transportation costs. Higher interest expense and lower volume also impacted EPS negatively. Outlook Third Quarter Fiscal 2007 For the fiscal 2007 third quarter, the Company expects to deliver sales growth of approximately 14% to 16% over net sales of $789.6 million in the third quarter of fiscal 2006. Diluted EPS from continuing operations is expected to be approximately $0.14 to $0.16, including $0.04 of transformation-related expenses, $0.02 of integration expense, and $0.01 of purchase accounting impact, as compared to $0.22 in the third quarter of fiscal 2006. [TABLE OMITTED] Fiscal 2007 For fiscal 2007, the Company now expects sales growth of 12% to 15% (compared to previous guidance of 14% to 16%) over fiscal 2006 net sales of $2,998.6 million, reflecting second quarter volume performance. Fiscal 2007 net sales growth is expected to be driven primarily by the Meow Mix and Milk-Bone acquisitions. The Company continues to anticipate diluted EPS from continuing operations to be $0.48 to $0.53 in fiscal 2007, which includes approximately $0.11 to $0.14 of transformation-related expenses, $0.06 of integration expense, and $0.05 of purchase accounting impact. The Company reported $0.67 diluted EPS from continuing operations in fiscal 2006. The Company reiterated that it expects cash provided by operating activities, less cash used in investing activities, to be approximately $150 to $170 million. [TABLE OMITTED] Webcast Information Del Monte Foods will host a live audio webcast, accompanied by a slide presentation, to discuss its fiscal 2007 second quarter results and outlook at 7:00 a.m. PT (10:00 a.m. ET) today. The webcast slide presentation and historical, quarterly results can be accessed at www.delmonte.com/Company/investors. 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 billion in net sales 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 costs of the transformation plan, the integration of the Meow Mix and Milk-Bone acquisitions and purchase accounting, as well as to the Company's strategic plan. Factors that could cause actual results to differ materially from those described in this press release include, among others: general economic and business conditions; 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, 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. ; 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 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; 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 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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