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GERBER F'94 2ND QUARTER EPS $0.48 VS. $0.44 IN F'93

 FREMONT, Mich., Oct. 19 /PRNewswire/ -- Earnings per share of the Gerber Products Company (NYSE: GEB) for the three months ended Sept. 30, 1993 (the second quarter of fiscal 1994) rose to $0.48, a record for the second quarter, compared to $0.44 in last year's second quarter.
 Fiscal 1994 second quarter revenue was $311 million compared to $345 million last year. Net earnings for the second quarter were $34 million versus $33 million a year earlier, an increase of 2.8 percent. Earnings per share, assisted by stock repurchases over the past year, were $0.48, up 9.1 percent from $0.44 in the prior year.
 "A number of factors contributed to the better than expected performance in the second quarter," said Al Piergallini. "The Gerber Graduates line of toddler foods continues to grow with volume up 43 percent over last year's second quarter. The baby care business improved its profitability. Our life insurance company again exceeded expectations. And, we benefited from a more favorable than expected tax rate."
 For the first six months of fiscal 1994, revenue was $594 million compared to $660 million last year. Six-month net earnings, before the cumulative effect of accounting changes, were $60 million, or $0.86 per share, versus $65 million, or $0.88 per share, a year ago.
 Last year's second quarter and six-month results include both sales and earnings contributions from the Buster Brown Apparel business, which Gerber sold in February 1993.
 Baby food sales for the second quarter were $207 million, compared to $209 million last year. U.S. baby food volume declined 2 percent in the second quarter compared with the prior year period as a result of a continuing decline in the U.S. birthrate and per capita consumption of baby food. Gerber's U.S. retail market share for baby food averaged 71 percent for the second quarter of fiscal 1994. "As we have said in the past, we are focusing on the growth of our international business through a number of investments and expanding consumption of baby food in the U.S. with our Gerber Graduates line. Both programs showed excellent progress in the second quarter," said Piergallini.
 Baby care sales were $27 million in the second quarter versus $28 million in last year's second quarter. "We continued to make progress in gaining baby care distribution in retail channels which provide better profit margins and long-term growth. We recently signed a new license agreement in order to utilize certain Looney Tunes Lovables characters on our products which should add impetus to our baby care business as well as our Gerber Childrenswear business," Piergallini said.
 Operating income for the baby food and baby care segment was $48 million, virtually flat with the second quarter of fiscal 1993.
 The apparel segment's sales for the second quarter declined to $51 million from the $86 million last year. Operating income increased to $5.9 million from $5.8 million a year earlier. The sales decline is attributable to the fact that Gerber sold its Buster Brown Apparel business in February 1993.
 The other segment, primarily the Gerber Life Insurance Company had both sales and operating income increases, up 15 percent and 28 percent, respectively.
 "We remain confident that the growth investment programs that we are pursuing in fiscal 1994, while limiting the current year earnings per share increase to the high single digit range, will pay off in profit dividends in fiscal 1995 and beyond," Piergallini said.
 GERBER PRODUCTS COMPANY
 RESULTS OF OPERATIONS(A)
 QUARTER ENDED SEPT. 30
 PCT
 1993 1992 CHANGE
 Net Sales and Revenue $310,688 $344,729 (9.9)
 Interest, Royalties & Other
 Income 5,976 5,006 19.4
 Cost of Products Sold &
 Services Provided 167,845 198,004 (15.2)
 Mktg., Distribution, Admin.
 and General Expenses 94,059 98,396 (4.4)
 Interest Expense 3,040 3,269 (7.0)
 Earnings Before Taxes 51,720 50,066 3.3
 Income Taxes 18,160 17,407 4.3
 Net Earnings $ 33,560 $ 32,659 2.8
 -------- --------
 Net Earnings Per Share $0.48 $0.44 9.1
 Average Shares Outstanding 69,330 74,108
 RESULTS BY SEGMENT(A)
 QUARTER ENDED SEPT. 30
 Sales and Revenue Operating Profit
 1993 1992 1993 1992
 Food and Baby Care
 Food $207,401 $208,543
 Baby Care 26,635 28,160
 Total 234,036 236,703 $47,923 $48,198
 Apparel Group 51,483 86,228 5,937 5,774
 Other 25,169 21,798 3,024 2,355
 Total $310,688 $344,729 56,884 56,327
 -------- --------
 Interest Expense (3,040) (3,269)
 Investment Income 2,110 1,700
 General Corp. Exp. (4,234) (4,692)
 Earnings Before Taxes 51,720 50,066
 Income Taxes 18,160 17,407
 Net Earnings $33,560 $32,659
 ------- -------
 (A) -- Unaudited. Amounts in thousands, except per share data.
 RESULTS OF OPERATIONS(A)
 SIX MONTHS ENDED SEPT. 30
 PCT
 1993 1992 CHANGE
 Net Sales and Revenue $593,635 $660,200 (10.1)
 Interest, Royalties & Other
 Income 13,854 10,545 31.4
 Cost of Products Sold &
 Services Provided 319,388 372,158 (14.2)
 Mktg., Distribution, Admin.
 and General Expenses 188,992 191,230 (1.2)
 Interest Expense 6,076 6,614 (8.1)
 Earnings Before Taxes 93,033 100,743 (7.7)
 Income Taxes 32,982 35,564 (7.3)
 Earnings Before Cumulative
 Effect of Accounting Changes 60,051 65,179 (7.9)
 Cumulative Effect of
 Accounting Changes (90,390)
 Net Earnings (Loss) $ 60,051 $(25,211)
 -------- --------
 Earnings (Loss) Per Share:
 Before Cumulative Effect of
 Accounting Changes $0.86 $0.88
 Cumulative Effect of
 Accounting Changes (1.22)
 Net Earnings (Loss) Per Share $0.86 $(0.34)
 ----- ------
 Average Shares Outstanding 69,902 74,193
 (A) -- Unaudited. Amounts in thousands, except per share data.
 RESULTS BY SEGMENT(A)
 SIX MONTHS ENDED SEPT. 30
 Sales and Revenue Operating Profit
 1993 1992 1993 1992
 Food and Baby Care
 Food $408,207 $417,932
 Baby Care 51,157 51,022
 Total 459,364 468,954 $ 89,922 $100,181
 Apparel Group 84,191 149,133 6,363 7,292
 Other 50,080 42,113 7,284 4,546
 Total $593,635 $660,200 103,569 112,019
 -------- --------
 Interest Expense (6,076) (6,614)
 Investment Income 4,132 3,891
 General Corp. Exp. (8,592) (8,553)
 Earnings Before Taxes 93,033 100,743
 Income Taxes 32,982 35,564
 Earnings Before Cumulative Effect
 of Accounting Changes 60,051 65,179
 Cumulative Effect of Accounting Changes (90,390)
 Net Earnings (Loss) $ 60,051 $(25,211)
 -------- --------
 (A) -- Unaudited. Amounts in thousands, except per share data.
 CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION(A)
 AS OF SEPT. 30
 1993 1992
 Assets
 Cash and Short-Term Investments $ 35,789 $ 88,511
 Accounts Receivable 108,391 134,792
 Inventories 185,525 220,428
 Other Current Assets 72,241 56,839
 Total Current Assets 401,946 500,570
 Other Assets 301,709 249,414
 Net Land, Buildings and Equipment 242,475 238,975
 Total $946,130 $988,959
 -------- --------
 Liabilities and Shareholders' Equity
 Current Liabilities $252,385 $245,470
 Long-Term Debt 116,332 122,458
 Postretirement Benefits Obligation 154,544 143,593
 Other Liabilities 101,326 83,068
 Shareholders' Equity 321,543 394,370
 Total $946,130 $988,959
 -------- --------
 (A) -- Unaudited. Amounts in thousands.
 -0- 10/19/93
 /CONTACT: Tim Croasdaile, vice president - Investor Relations & Corporate Affairs of Gerber Products, 616-928-2718/
 (GEB)


CO: Gerber Products Company ST: Michigan IN: FOD SU: ERN

SB -- DE012 -- 3855 10/19/93 10:27 EDT
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