Snyder's-Lance, Inc. Reports Results for Full Year 2012

-- Grows earnings per diluted share more than 51% vs. prior year, 35% excluding special items

-- Reports 2012 full year earnings per diluted share of $0.95 excluding special items

-- Reports 2012 full year earnings per diluted share of $0.85 including special items

-- Completes merger integration work and Snack Factory acquisition during 2012

-- Positive outlook in 2013 for Net Revenue and Earnings per Share

Feb 12, 2013, 06:00 ET from Snyder's-Lance, Inc.

CHARLOTTE, N.C., Feb. 12, 2013 /PRNewswire/ -- Snyder's-Lance, Inc. (Nasdaq: LNCE) today reported results for its fiscal year 2012.  Net revenues for the year ended December 29, 2012, were $1.62 billion, a decrease of 1.0% from prior year net revenues of $1.64 billion. Net revenue, when adjusted for the impact of the independent business owner ("IBO") route system conversion, increased 2.2% year over year. The Company realized full year net income of $66.1 million, excluding special items, or $0.95 per diluted share, as compared to full year 2011 net income of $47.8 million, excluding special items, or $0.70 per diluted share.  Net income, including special items, was $59.1 million, or $0.85 per diluted share, for the full year 2012 compared to $38.3 million, or $0.56 per diluted share, for 2011.

(Logo: http://photos.prnewswire.com/prnh/20110411/CL80943LOGO)

Special items for 2012 were $7.0 million, after tax expense, and included approximately $2.6 million in severance costs and professional fees related to merger and integration activities, approximately $6.6 million in asset impairment charges, approximately $4.9 million in charges related to consolidation activities, and approximately $1.2 million in expenses associated with the acquisition of Snack Factory. Special items for 2012 also included gains on the sale of route businesses of approximately $8.3 million, net of the incremental taxes incurred on these gains. Special items, after tax expense, for 2011 included approximately $12.8 million of severance and professional fee expenses associated with merger and other integration efforts, approximately $6.5 million related to the impairment of transportation equipment, and approximately $1.7 million of impairment charges related to the closing of a manufacturing facility in Corsicana, TX. Special items for 2011 also included after-tax gains on the sale of route businesses of approximately $5.0 million and approximately $6.5 million related to a change in vacation plan.  

Fourth quarter 2012 net revenues were $420 million including sales of Pretzel Crisps®, an increase of 1.9% compared to prior year fourth quarter net revenues of $412 million. Fourth quarter 2012 net income was $20.4 million, excluding special items, which was 44.4% above the $14.1 million of net income, excluding special items for the prior year. Net income including special items was $7.8 million for the fourth quarter 2012 compared to a fourth quarter 2011 net income including special items of $22.4 million

Comments from Management "This was an important and successful year for Snyder's-Lance," commented David V. Singer, Chief Executive Officer.  "During 2012, we grew our earnings more than 35%, excluding special items, and grew our sales by 2.2% when the impact of our IBO conversion is excluded.  We completed our merger integration, while we also rolled out and began to implement our strategic plan.  In line with this plan, we delivered strong growth in our core branded items of Snyder's of Hanover®, Lance® and Cape Cod®, and we acquired Snack Factory® and the fast growing Pretzel Crisps® brand.  In 2012, we also invested in capacity and innovation capabilities while we improved margins on our non-branded items by discontinuing sales to certain customers who did not accept price increases. In the coming year, we'll continue to build on this solid foundation as we drive for results that grow our top line and expand our margins through innovation and continued strong execution in the marketplace.  Our new R&D center will open in 2013, and it will support aggressive innovation goals for our future." 

Mr. Singer continued, "As we recently announced, I have elected to retire from my role as CEO following our annual shareholders meeting on May 3, 2013. Carl E. Lee, Jr. our President and COO, will take on the title of CEO at that time.  Our plans for 2013 and beyond look very bright, and with Carl's exceptional leadership, I am confident in our ability to grow the Company and drive shareholder value as we expand our reach to new consumers and markets."

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 6, 2013 to stockholders of record at the close of business on February 27, 2013.

Estimates provided for 2013 The Company estimates that its net revenue for the full year 2013 will be up 10% to 12% when compared to 2012.  Estimates for earnings per diluted share show an increase between 22% and 32% compared to 2012 earnings per diluted share, excluding special items.  Capital expenditures for 2013 are projected to be between $78 and $83 million as investments are made in plant improvements, quality, capacity and innovation.

Conference Call Management will conduct a conference call and live webcast at 9:00 am eastern time on Tuesday, February 12, 2013 to review the Company's full year results. The conference call and accompanying slide presentation will be webcast live through the Investor Relations section of the Company's website, www.snyderslance.com.   In addition, the slide presentation will be available to download and print approximately 30 minutes before the webcast at www.snyderslance.com. 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 12 and midnight on February 19. The replay telephone number is (855) 859-2056 for U.S. callers or (404) 537-3406 for international callers.  The replay access code is 93605983.  Investors may also access a web-based replay of the conference call at www.snyderslance.com.

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

Cautionary Note Regarding Forward-Looking Statements This press release includes statements about future economic performance, finances, expectations, plans and prospects of Snyder's-Lance, that constitute forward-looking statements for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.    Some forward-looking statements may be identified by use of terms such as "believe," "anticipate," "intend," "expect," "project," "plan," "may," "should," "could," "will," "estimate," "predict," "potential," "continue," and similar words.  Such forward-looking statements are subject to certain risks, uncertainties and other important factors that could cause actual results to differ materially from those expressed in or suggested by such statements. For further information regarding cautionary statements and factors affecting future results, please refer to the risk factors in the Company's most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q filed subsequent to the Annual Report.  Readers are cautioned not to unduly rely on forward looking statements, which speak only as of the date made. The Company undertakes no obligation to update or revise publicly any forward-looking statement whether as a result of new information, future developments or otherwise.

 

 

SNYDER'S-LANCE, INC. AND SUBSIDIARIES Consolidated Statements of Income (Unaudited) (in thousands, except per share data)

Quarter Ended

Fiscal Year Ended

December 29, 2012

December 31, 2011

December 29, 2012

December 31, 2011

Net revenue

$            419,826

$              412,127

$      1,618,634

$         1,635,036

Cost of sales

277,209

268,012

1,079,777

1,065,107

Gross margin

142,617

144,115

538,857

569,929

Selling, general and administrative

115,733

110,412

440,597

495,267

Impairment charges

11,655

2,585

11,862

12,704

Gain on sale of route businesses, net

(739)

(5,652)

(22,335)

(9,440)

Other (income)/expense, net

(283)

1,381

(407)

993

Income before interest and income taxes

16,251

35,389

109,140

70,405

Interest expense, net

3,229

2,496

9,487

10,560

Income before income taxes

13,022

32,893

99,653

59,845

Income tax expense

5,212

10,274

40,143

21,104

Net income

7,810

22,619

59,510

38,741

Net income attributable to noncontrolling interests

28

192

425

483

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

$                7,782

$                22,427

$            59,085

$              38,258

Basic earnings per share

$                   0.11

$                   0.33

$                 0.86

$                 0.57

Weighted average shares outstanding – basic

68,725

67,798

68,382

67,400

Diluted earnings per share

$                  0.11

$                  0.33

$                 0.85

$                 0.56

Weighted average shares outstanding – diluted

69,586

68,882

69,215

68,478

Cash dividends declared per share

$                   0.16

$                   0.16

$                 0.64

$                 0.64

 

 

SNYDER'S-LANCE, INC. AND SUBSIDIARIES Consolidated Balance Sheets (Unaudited) As of December 29, 2012 and December 31, 2011 (in thousands, except share data)

2012

2011

ASSETS

Current assets:

Cash and cash equivalents

$

9,276

$

20,841

Accounts receivable, net of allowances of $2,159 and $1,884, respectively

141,862

143,238

Inventories

118,256

106,261

Income tax receivable

18,119

Deferred income taxes

11,625

21,042

Assets held for sale

11,038

57,822

Prepaid expenses and other current assets

28,676

20,705

Total current assets

320,733

388,028

Noncurrent assets:

Fixed assets, net

331,385

313,043

Goodwill

540,389

367,853

Other intangible assets, net

531,735

376,062

Other noncurrent assets

22,490

21,804

Total assets

$

1,746,732

$

1,466,790

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Current portion of long-term debt

$

20,462

$

4,256

Accounts payable

52,753

52,930

Accrued compensation

31,037

29,248

Accrued profit-sharing and retirement plans

354

9,249

Accrual for casualty insurance claims

4,779

6,957

Accrued selling and promotional costs

16,240

21,465

Income tax payable

1,263

Other payables and accrued liabilities

27,735

31,041

Total current liabilities

154,623

155,146

Noncurrent liabilities:

Long-term debt

514,587

253,939

Deferred income taxes

176,037

196,244

Accrual for casualty insurance claims

9,759

7,724

Other noncurrent liabilities

19,551

15,146

Total liabilities

874,557

628,199

Commitments and contingencies

Stockholders' equity:

Common stock, $0.83 1/3 par value. Authorized 75,000,000 shares;

68,863,974 and 67,820,798 shares outstanding, respectively

57,384

56,515

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

Additional paid-in capital              

746,155

730,338

Retained earnings

50,847

35,539

Accumulated other comprehensive income

15,118

13,719

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

869,504

836,111

Noncontrolling interests

2,671

2,480

Total stockholders' equity

872,175

838,591

Total liabilities and stockholders' equity

$

1,746,732

$

1,466,790

 

 

SNYDER'S-LANCE, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Cash Flows (Unaudited) For the Fiscal Years Ended December 29, 2012 and December 31, 2011 (in thousands)

2012

2011

Operating activities:

Net income

$

59,510

$

38,741

Adjustments to reconcile net income to cash from operating activities:

Depreciation and amortization

53,764

55,337

Stock-based compensation expense

4,693

2,535

Loss on sale of fixed assets, net

597

1,851

Gain on sale of route businesses

(22,335)

(9,440)

Impairment charges

11,862

12,704

Change in vacation plan

(9,916)

Deferred income taxes

(15,279)

6,026

Provision for doubtful accounts

1,479

402

Changes in operating assets and liabilities, excluding business acquisitions

(1,523)

13,288

Net cash provided by operating activities

92,768

111,528

Investing activities:

Purchases of fixed assets

(80,304)

(57,726)

Purchases of route businesses

(28,523)

(31,418)

Proceeds from sale of fixed assets

9,324

4,351

Proceeds from sale of route businesses

93,896

42,294

Proceeds from sale of investments

1,444

960

Proceeds from federal grant for solar farm

4,212

Business acquisitions, net of cash acquired

(344,181)

(15,394)

Net cash used in investing activities

(348,344)

(52,721)

Financing activities:

Dividends paid to stockholders

(43,777)

(42,918)

Dividends paid to noncontrolling interests

(234)

(281)

Acquisition of remaining interest in Melisi Snacks, Inc.

(3,500

Debt issuance costs

(2,028)

Issuances of common stock

9,710

8,142

Excess tax benefits from stock-based compensation

2,618

49

Repurchases of common stock

(335)

Repayments of long-term debt

(2,476)

(62,309)

Proceeds from long-term debt

325,211

Net (repayments)/proceeds from existing credit facilities

(44,841)

35,098

Net cash provided by/(used in) financing activities

243,848

(65,719)

Effect of exchange rate changes on cash

163

(124)

Decrease in cash and cash equivalents

(11,565)

(7,036)

Cash and cash equivalents at beginning of fiscal year

20,841

27,877

Cash and cash equivalents at end of fiscal year

$

9,276

$

20,841

Supplemental information:

Cash paid for income taxes, net of refunds of $12,591, $7,375 and $23, respectively

$

33,554

$

2,364

Cash paid for interest

$

10,533

$

11,341

 

SNYDER'S-LANCE, INC. AND SUBSIDIARIES Reconciliation of Non-GAAP Measures (Unaudited) (in thousands, except per share data)

Net of

Tax

Per Diluted Share

Quarter Ended December 29, 2012

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

$                7,782

$               0.11

   Merger-related items

1,149

0.02

   Snack Factory acquisition costs

876

0.01

   Manufacturing consolidation activities

3,238

0.04

   Trademark impairment

4,966

0.07

   Disposal costs and fixed asset impairments

1,896

0.03

   Gain on sale of route businesses

(411)

0.00

   Incremental income tax associated with non-deductible goodwill

    on the sale of route businesses

897

0.01

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

$              20,393

$               0.29

Quarter Ended December 31, 2011

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

$              22,427

$               0.33

   Costs related to closing 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

Year Ended December 29, 2012

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

$              59,085

$               0.85

   Merger-related items

2,589

0.04

   Snack Factory acquisition costs

1,163

0.02

   Manufacturing consolidation activities

4,921

0.07

   Trademark impairment

4,966

0.07

   Disposal costs and fixed asset impairments

1,621

0.03

   Gain on sale of route businesses

(13,869)

(0.21)

   Incremental income tax associated with non-deductible goodwill

    on the sale of route businesses

5,604

0.08

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

$              66,080

$               0.95

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 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

 

 

 

SOURCE Snyder's-Lance, Inc.



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http://www.snyderslance.com