2014

Snyder's-Lance, Inc. Reports Results for Full Year 2011 - Reports full year Net Revenue of $1.64 Billion, a 67% increase over prior year

- Reports 2011 full year earnings per diluted share of $0.70 excluding special items

- Reports 2011 full year earnings per diluted share of $0.56 including special items

- Merger integration on track to be completed as planned mid-year 2012

CHARLOTTE, N.C., Feb. 10, 2012 /PRNewswire/ -- Snyder's-Lance, Inc. (Nasdaq-GS: LNCE) today reported results for its fiscal year 2011.  Snyder's-Lance, Inc. was formed on December 6, 2010 as a result of the merger ("Merger") of Lance, Inc. ("Lance") and Snyder's of Hanover, Inc. ("Snyder's").  Prior year results are attributable to Lance prior to the Merger and the operations of the combined company after the Merger.  2010 full year results also included a 53rd week.  Where comparisons are made to 2010 results, excluding special items, these include the additional week in 2010.

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Net revenues for the year ended December 31, 2011, were $1.64 billion, an increase of 67% over prior year net revenues of $980 million.  The Company realized full year net income of $47.8 million excluding special items or $0.70 per diluted share, as compared to full year 2010 net income of $36.0 million excluding special items, or $1.05 per diluted share. Net income including special items was $38.3 million, or $0.56 per diluted share, for the full year 2011 compared to $2.5 million, or $0.07 per diluted share, for 2010.  Special items for 2011 were $9.5 million, after tax expense.  These items included $12.8 million of severance and professional fee expenses associated with the Merger and other integration efforts, $6.5 million related to the impairment of transportation equipment, and $1.7 million of impairment charges related to the closing of a manufacturing facility in Corsicana, TX.  Special items for 2011 also included gains on the sale of route businesses of $5.0 million and a gain of $6.5 million related to a change in vacation plan. Special items for 2010 included after tax expenses of $1.9 million associated with unsuccessful acquisition costs, $2.0 million related to a workforce reduction, $28.2 million associated with the Merger with Snyder's of Hanover, Inc. and $1.4 million related to other items.

Fourth quarter 2011 net revenues were $412 million, an increase of 45% compared to prior year fourth quarter net revenues of $285 million.  Fourth quarter 2011 net income was $14.1 million, excluding special items, which was 75% above the $8.1 million of net income, excluding special items for the prior year. Net income including special items was $22.4 million for the fourth quarter 2011 compared to a fourth quarter 2010 net loss including special items of $19.4 million.

Comments from Management

"The year 2011 was transformational for Snyder's-Lance, and I'm very pleased with our progress," commented David V. Singer, Chief Executive Officer.  "Our team has done an exceptional job of executing on the complex challenges of Merger integration while continuing to deliver solid top line performance.  Our branded products net sales grew by 4.7% on a Proforma basis excluding the reduction in net sales that is associated with converting from company-owned to an independent operator route system.  Our largest and most profitable brands and product lines (Snyder's of Hanover pretzels, Lance sandwich crackers and Cape Cod kettle chips) delivered near double digit growth in net sales in 2011, on a Proforma basis.  For the full year 2011, we also reduced our net debt by $20 million on solid net cash flows, and expect to see expect to see net cash flows improve in 2012 as we complete the sale of company owned routes to independent business operators in our direct store delivery network.  Although our margins were pressured in 2011, primarily in private brand products, I'm very proud of what has been accomplished by our associates, and look forward to completing the work of integration by mid-year 2012 and then focusing even more sharply on growing our profit margins."

Mr. Singer continued, "We recently completed the development of our strategic plan, which clarifies our priorities and focus, and sets aggressive goals for the next several years.  We will focus most of our resources on growing our core brands and product lines (Snyder's of Hanover pretzels, Lance sandwich crackers, and Cape Cod Potato Chips).  These core brands represent the categories where we have the best market position, profit margins and growth prospects.  These will be the primary focus of our resources and deliver the majority of our internal growth in the next few years.  At the same time, we will focus on improving the margins on our allied brands and private brands products.  As we move through 2012, we believe this focus and the completion of our integration work will deliver wider profit margins and position the company for long-term profitable growth.  We anticipate driving growth in our existing product portfolio through excellent marketing programs and expanded distribution. We also anticipate growth from the internal development of new and existing product lines as well as through strategic acquisitions. "

Dividend Declared

The Company also announced the declaration of a quarterly cash dividend of $0.16 per share on the Company's common stock.  The dividend is payable on March 7, 2012 to stockholders of record at the close of business on February 29, 2012.

Estimates Provided for 2012

Lower pricing associated with the conversion to an independent business operator (IBO) model in the Company's direct store delivery (DSD) network is expected to reduce net revenues between 4% and 5% for 2012 as company owned routes transition during the first half of the year. However, the Company believes that its overall net revenue for the full year 2012 will only decline 1% to 3% overall, and that its earnings per diluted share will increase between 30% and 45%.  

We estimate capital expenditures to be in an $80 million to $85 million range for 2012 as we invest in our plant capacities.  

Conference Call

Snyder's-Lance, Inc. has scheduled a conference call and presentation with investors at 9:00 am eastern time on Friday, February 10, 2012 to discuss financial results.  To participate in the conference call, the dial-in number is (866) 814-7293 for U.S. callers or (702) 696-4943 for international callers.  A continuous telephone replay of the call will be available between 1:00 pm on February 10th and midnight on February 17th.  The replay telephone number is (800) 642-1687 for U.S. callers or (706) 645-9291 for international callers.  The replay access code is 46451484.  Investors may also access a web-based replay of the conference call at Snyder's-Lance's web site, www.snyderslance.com.

The conference call and accompanying slide presentation will be webcast live through the Investor Relations section of Snyder's-Lance, Inc.'s website www.snyderslance.com. In addition, the slide presentation will be available to download and print approximately 30 minutes before the webcast at Snyder's-Lance's Investor Relations home page.

About Snyder's-Lance, Inc.

Snyder's-Lance, Inc. (Nasdaq-GS: LNCE), headquartered in Charlotte, North Carolina, manufactures, markets and distributes snack foods throughout the United States and internationally. The Company's products include pretzels, sandwich crackers, potato chips, cookies, tortilla chips, restaurant style crackers, nuts and other snacks. Snyder's-Lance, Inc. has manufacturing facilities in North Carolina, Pennsylvania, Iowa, Indiana, Georgia, Arizona, Massachusetts, Florida, Ohio, and Ontario, Canada. Products are sold under brand names including Snyder's of Hanover, Lance, Cape Cod, Tom's, Jays, Krunchers!, Grande, Archway, O-Ke-Doke, and Stella D'oro along with a number of private label and third party brands. Products are distributed widely through grocery and mass merchandisers, convenience stores, club stores, food service outlets and other channels.  

LNCE-E

Cautionary Information about Forward Looking Statements

This news release contains statements which may be forward looking within the meaning of applicable securities laws. The statements include projections regarding future revenues, earnings and other results which are based upon the Company's current expectations and assumptions, which are subject to a number of risks and uncertainties. Factors that could cause actual results to differ include: general economic conditions; increases in cost or availability of ingredients, packaging, energy and employees; price competition and industry consolidation; loss of major customers or changes in product offerings with significant customers; business disruption from merger integration and conversion of our distribution network to independent operators, including failure to realize anticipated synergies in a timely manner or the loss of key personnel; failure to maintain proper and effective internal controls; ability to execute strategic initiatives; product recalls and concerns surrounding the quality or safety of products and ingredients; disruptions to our supply chain or information technology systems; changes in consumer preferences; inability to maintain existing markets or expand to other geographic markets; potential threats to trademarks and other proprietary intellectual rights; food industry and regulatory factors; interest rate and foreign exchange rate risks; and the interests of significant stockholders may conflict with those of other stockholders, which have been discussed in greater detail in our most recent Form 10-K and other reports filed with the Securities and Exchange Commission.

SNYDER'S-LANCE, INC. AND SUBSIDIARIES

Consolidated Statements of Income

(in thousands, except share and per-share data)

(unaudited)



Quarter Ended


Fiscal Year Ended


December 31, 2011


January 1, 2011


December 31, 2011


January 1, 2011









Net revenue

$  412,127


$  285,118


$  1,635,036


$  979,835

Cost of sales

268,012


182,229


1,065,107


601,015

Gross margin

144,115


102,889


569,929


378,820









Selling, general and administrative

110,412


123,111


495,267


359,629

Other (income)/expense, net

(1,686)


3,103


4,257


7,108

Income/(Loss) before interest and income taxes

35,389


(23,325)


70,405


12,083









Interest expense, net

2,496


1,358


10,560


3,921

Income/(Loss) before income taxes

32,893


(24,683)


59,845


8,162









Income tax expense/(benefit)

10,274


(5,309)


21,104


5,631

Net income/(loss)

22,619


(19,374)


$  38,741


$  2,531









Net income attributable to non-controlling interests

192


19


483


19

Net income/(loss) attributable to Snyder's-Lance, Inc.

$  22,427


$  (19,393)


$  38,258


$  2,512









Basic earnings/(loss) per share

$  0.33


$   (0.48)


$  0.57


$  0.07

Weighted average shares outstanding – basic

67,798,000


40,164,000


67,400,000


34,128,000









Diluted earnings/(loss) per share

$   0.33


$   (0.48)


$  0.56


$  0.07

Weighted average shares outstanding – diluted

68,882,000


40,164,000


68,478,000


34,348,000









Cash dividends declared per share, including special dividend of $3.75 per share in 2010

$  0.16


$  3.91


$  0.64


$  4.39




SNYDER'S-LANCE, INC. AND SUBSIDIARIES

Consolidated Balance Sheets

As of December 31, 2011 and January 1, 2011

(unaudited)


(in thousands, except share data)


2011

2010

ASSETS




Current assets:




 Cash and cash equivalents


$   20,841

$   27,877

 Accounts receivable, net of allowances of $1,884 and $2,899, respectively


143,238

128,556

 Inventories


106,261

96,936

 Income tax receivable


18,119

29,304

 Deferred income taxes


21,042

14,346

 Assets held for sale


57,822

385

 Prepaid expenses and other current assets


20,705

26,363

   Total current assets


388,028

323,767





Fixed assets


313,043

336,673

Goodwill, net


367,853

376,281

Other intangible assets, net


376,062

407,579

Other noncurrent assets


21,804

18,056

     Total assets


$   1,466,790

$   1,462,356





LIABILITIES AND STOCKHOLDERS' EQUITY




Current liabilities:




 Accounts payable


$   52,930

$   39,938

 Accrued compensation


29,248

31,564

 Accrued profit-sharing retirement plan


9,249

9,884

 Accrual for casualty insurance claims


6,957

6,477

 Accrued selling costs


21,465

15,521

 Other payables and accrued liabilities


31,041

32,118

 Current portion of long-term debt


4,256

57,767

   Total current liabilities


155,146

193,269





Long-term debt


253,939

227,462

Deferred income taxes


196,244

180,812

Accrual for casualty insurance claims


7,724

9,195

Other noncurrent liabilities


15,146

15,003

     Total liabilities


628,199

625,741





Commitments and contingencies


-

-





Stockholders' equity:




 Common stock, $0.83 1/3 par value. Authorized 75,000,000 shares;
   67,820,798 and 66,336,807 shares outstanding, respectively


56,515

55,278

 Preferred stock, $1.00 par value. Authorized 5,000,000 shares;
   no shares outstanding


-

-

 Additional paid-in capital


730,338

722,007

 Retained earnings


35,538

40,199

 Accumulated other comprehensive income


13,720

15,104

   Total Snyder's-Lance, Inc. stockholders' equity


836,111

832,588

   Noncontrolling interests


2,480

4,027

   Total stockholders' equity


838,591

836,615

     Total liabilities and stockholders' equity


$   1,466,790

$   1,462,356




SNYDER'S-LANCE, INC. AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the Fiscal Years Ended December 31, 2011 and January 1, 2011

(unaudited)


(in thousands)


2011

2010





Operating activities:




Net income


$  38,741

$   2,531

Adjustments to reconcile net income to cash from operating activities:




 Depreciation and amortization


55,337

40,100

 Stock-based compensation expense


2,535

19,524

 Loss on sale of fixed assets, net


1,851

682

 Gain on sale of route businesses


(9,440)

-

 Impairment of long-lived assets


12,704

584

 Change in vacation policy


(9,916)

-

 Deferred income taxes


6,026

18,228

 Provision for doubtful accounts


402

2,649

 Changes in operating assets and liabilities, excluding business acquisitions and
   foreign currency translation adjustments:




   Accounts receivable


(15,773)

4,376

   Inventory


(8,680)

7,496

   Other current assets


17,022

(30,885)

   Accounts payable


11,665

(6,032)

   Other accrued liabilities


12,585

(19,562)

   Other noncurrent assets


(2,882)

2,519

   Other  noncurrent liabilities


(649)

2,234

Net cash provided by operating activities


111,528

44,444





Investing activities:




 Purchases of fixed assets


(57,726)

(33,347)

 Purchases of route businesses


(31,418)

-

 Proceeds from sale of fixed and intangible assets


4,351

2,731

 Proceeds from sale of route businesses


42,294

-

 Proceeds from sale of investments


960

-

 Proceeds from federal grant for solar farm


4,212

-

 Business acquisitions, net of cash acquired


(15,394)

96,336

Net cash (used in)/provided by investing activities


(52,721)

65,720





Financing activities:




 Dividends paid to stockholders


(42,918)

(142,458)

 Dividends paid to noncontrolling interests


(281)

-

 Acquisition of additional interest in Melisi Snacks, Inc.


(3,500)

-

 Issuances of common stock


8,191

13,102

 Repurchases of common stock


-

(6,519)

 Repayments of long-term debt


(62,309)

-

 Net proceeds from existing credit facilities


35,098

47,762

Net cash used in financing activities


(65,719)

(88,113)





Effect of exchange rate changes on cash


(124)

408

(Decrease)/increase in cash and cash equivalents


(7,036)

22,459

Cash and cash equivalents at beginning of fiscal year


27,877

5,418

Cash and cash equivalents at end of fiscal year


$   20,841

$   27,877





Non-cash investing activities:




Common stock and options issued for business combinations


$   -

$   676,211





Supplemental information:




Cash paid for income taxes, net of refunds of $7,250, $23 and $149, respectively


$   2,364

$   12,208

Cash paid for interest


$   11,341

$   6,391




SNYDER'S-LANCE, INC. AND SUBSIDIARIES

Reconciliation of Non-GAAP Measures

(in thousands, except per share data)

(unaudited)




Net of

Tax


Per Diluted

Share

Quarter Ended December 31, 2011




Net income attributable to Snyder's-Lance, Inc.

$  22,427


$  0.33





  Costs related to closing and selling the Corsicana, TX manufacturing facility

1,690


0.02

  Change in vacation policy

(6,445)


(0.09)

  Gain on sale of route businesses

(4,618)


(0.07)

  Other merger-related costs – severance and professional fees

1,065


0.01





Net income attributable to Snyder's-Lance, Inc., excluding special items

$  14,119


$  0.20





Quarter Ended January 1, 2011




Net loss attributable to Snyder's-Lance, Inc.

$  (19,393)


$  (0.48)





   Costs related to Merger

25,995


0.65

   Costs related to insurance settlement

1,466


0.03





Net income attributable to Snyder's-Lance, Inc., excluding special items

$  8,068


$  0.20





Year Ended December 31, 2011




Net income attributable to Snyder's-Lance, Inc.

$  38,258


$  0.56





  Impairment of route trucks

6,481


0.09

  Costs related to closing and selling the Corsicana, TX manufacturing facility

1,690


0.02

  Change in vacation policy

(6,445)


(0.09)

  Gain on sale of route businesses

(4,975)


(0.07)

  Other merger-related costs – severance and professional fees

12,764


0.19





Net income attributable to Snyder's-Lance, Inc., excluding special items

$  47,773


$  0.70





Year Ended January 1, 2011




Net income attributable to Snyder's-Lance, Inc.

$  2,512


$  0.07





   Costs related to Merger

28,162


0.82

   Costs related to insurance settlement

1,466


0.04

   Employee termination costs from workforce reduction

1,958


0.06

   Unsuccessful bid for targeted acquisition

1,930


0.06





Net income attributable to Snyder's-Lance, Inc., excluding special items

$  36,028


$  1.05




SOURCE Snyder's-Lance, Inc.



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