For the three quarters ended April 30, 2012, net sales were $757.4 million, up 3.5 percent over the prior year restated period. The increase was primarily due to an 11.0 percent increase in culinary/retail in-shell sales and a 10.0 percent increase in snack sales, offset by a 36.2 percent decrease in total non-retail sales. The decline in non-retail sales was primarily due to a significant drop in walnut crop deliveries to Diamond in the fall of 2011.

Gross profit as a percentage of net sales was 18.1 percent in the first three quarters of fiscal 2012, down from 22.9 percent in the prior year restated period. The

greatest impact on gross margin was a substantial decline in walnut crop deliveries to Diamond and an increase in average walnut cost per pound of over 50 percent. Rising prices of other commodities and higher operating costs primarily due to excess plant capacity also contributed to the downward pressure on gross margin.

Selling, general and administrative expense (SG&A) was $97.0 million in the first three quarters of fiscal 2012, a 35.6 percent increase compared to $71.6 million in the prior year restated period. The increase in SG&A expense was primarily related to the audit committee investigation, restatement and related expenses. When adjusted for certain costs associated with the audit committee investigation, restatement, and related matters, SG&A was $76.0 million compared to $71.6 million in the prior year restated period. The increase was due primarily to an increase in selling related expenses.

Advertising expense was $31.6 million in the first three quarters of fiscal 2012 compared to $34.4 million in the prior year restated period, a decline of 8.2 percent. The decrease in advertising expenses was primarily due to the cancellation of programs during the third quarter of fiscal 2012 in an effort to reduce costs.

Acquisition and integration expenses were $40.6 million in the first three quarters of fiscal 2102 primarily related to the terminated Pringles acquisition, compared to $7.5 million in the prior year restated period primarily related to Kettle integration.

Interest expense was $19.9 million in the three quarters of fiscal 2012 compared to $18.1 million in the prior year restated period, an increase of 9.9% due primarily to the forbearance fee of 0.25% paid to our lenders.

Income tax expense was $1.7 million in the first three quarters of fiscal 2012, compared to $12.3 million in the prior year restated period. The tax benefits of the company’s pre-tax loss of $51.7 million for the first three quarters of fiscal 2012 were offset by a $27.6 million charge to establish a valuation allowance against deferred tax assets. The valuation allowance charge was a result of recent net operating losses. Diamond also recognized a $5.6 million benefit in taxes in the first quarter of fiscal 2012 due to a favorable ruling with the U.K. tax authorities. Reversal of the valuation allowance in future periods is dependent on future taxable income and would result in income tax benefit in those periods.

The net loss for the first three quarters of fiscal 2012 was $53.4 million compared to net income of $23.7 million in the prior year restated period. The decrease was due primarily to the decline in gross profit, the significant increase in expenses related to the audit committee investigation, restatement, and Pringles integration planning, and the tax charge related to the valuation allowance against net deferred tax assets.

Non-GAAP income before income taxes for the first three quarters of fiscal 2012, which excludes acquisition and integration, audit committee investigation, restatement, legal and other related expenses, was $11.0 million compared to $43.6 million in the prior year restated period. The decrease was due primarily to the decline in gross profit. Please refer to page 12 for a reconciliation of non-GAAP information.

GAAP EPS on a fully diluted basis for the first three quarters of fiscal 2012 was ($2.46) compared to $1.05 in the prior year restated period.

Non-GAAP EPS on a fully diluted basis for the first three quarters of fiscal 2012 was $0.53 compared to a restated non-GAAP EPS of $1.54 in the prior year restated period. Please refer to page 12 for a reconciliation of non-GAAP information.

Capital expenditures were $40.6 million in the first three quarters of fiscal 2012, compared to $15.2 million in the prior year restated period. The increase was primarily due to the Kettle plant expansions in Beloit, Wisconsin and Norwich, England and for automation of Emerald’s ‘Breakfast on the Go’ product line.

Adjusted EBITDA for the first three quarters of fiscal 2012 declined to $58.9 million from $89.6 million in the prior year primarily due to lower gross profit. Please refer to page 13 for a reconciliation of non-GAAP information.

As of July 31, 2012, cash and availability on Diamond’s bank revolving line of credit was in excess of $70 million.

Brand YoY

Change

Category YoY

Change

Market Share

Change

Emerald snack nuts

Emerald Breakfast on the go!

Pop Secret

Kettle U.S.

Diamond of California

Net sales: $975 to $980 million

Snack sales: $600 to $605 million

Culinary sales: $290 to $295 million

Gross margin: 18.0% to 18.5%

Adjusted EBITDA: $78 to $81 million

The Audit Committee and the company have determined that certain grower payments of $20.8 million and $61.5 million previously accounted for in fiscal 2011 and 2012, were not accounted for in the correct periods. Corrections were made to account for these payments in the appropriate periods of fiscal 2010 and 2011. The restatement also included corrections related to accounts payable and accrued expenses which were accounted for in incorrect periods; these adjustments decreased net income $3.5 million in 2011 and $0.1 million in 2010.

The restatement resulted in a reduction in fiscal 2011 income before income taxes of $39.5 million ($69.1 million previously reported compared to $29.7 million restated), and $17.0 million in fiscal 2010 ($40.2 million previously reported compared to $23.2 million restated). Please refer to page 14 for summarized GAAP Statement of Operations.

Diluted EPS for restated fiscal 2011 was $1.17 compared to $2.22 per share as previously reported and $0.82 for restated fiscal 2010 as compared to $1.36 per share as previously reported.

Non-GAAP diluted EPS for restated fiscal 2011 was $1.76 compared to $2.61 per share as previously reported and $1.29 for restated fiscal 2010 as compared to $1.91 per share as previously reported. Please refer to page 16 for non-GAAP information.

Gross margin for restated fiscal 2011 was 22.4 percent compared to 26.0 percent as previously reported and 21.2 percent for restated fiscal 2010 as compared to 23.7 percent as previously reported. The decrease primarily was due to the correction of the walnut costs, which increased cost of goods sold in fiscal 2010 and 2011.

Adjusted EBITDA for restated fiscal 2011 was $111.5 million compared to $146.2 million as previously reported and $68.2 million for restated fiscal 2010 compared to $84.9 million as previously reported.

In connection with the Audit Committee investigation, management identified material weaknesses in internal control over financial reporting in three areas: control environment, walnut grower accounting, and accounts payable and accrued expenses. Numerous remediation steps have been implemented or are in progress to correct these weaknesses, including: enhanced oversight and controls, leadership changes, revised walnut cost estimation policy, enhanced documentation, oversight and monitoring of accounting policies related to walnut payments, and improved financial and operational reporting throughout the organization. For a list of remediation steps, please refer to the 10-K/A or supplemental presentation, both of which are available on the Diamond Foods website.

(in thousands)

Snack

Culinary/Retail in-shell

Total Retail

International Non-Retail

NA Ingredient/Food Service/Other

Total Non-Retail

Total Net Sales

(in thousands)

Snack

Culinary/Retail in-shell

Total Retail

International Non-Retail

NA Ingredient/Food Service/Other

Total Non-Retail

Total Net Sales

(in thousands, except per share amounts)

Net sales

Cost of sales

Gross profit

Gross margin

Operating expenses:

Selling general and administrative

Advertising

Acquisition and integration related expenses

Total operating expenses

Income (loss) from operations

Interest expense, net

Income (loss) before income taxes

Income tax expense (benefit)

Net income (loss)

Earnings (loss) per share:

Basic

Diluted

Shares used to compute earnings per share:

Basic

Diluted

(in thousands, except per share amounts)

Net sales

Cost of sales

Gross profit

Operating expenses:

Selling general and administrative

Advertising

Acquisition and integration related expenses

Total operating expenses

Income (loss) from operations

Interest expense, net

Income (loss) before income taxes

Income tax expense (benefit) **

Net income (loss)

Earnings (loss) per share:

Basic

Diluted

Shares used to compute earnings per share:

Basic

Diluted

(in thousands, except per share amounts)

Net sales

Cost of sales

Gross profit

Operating expenses:

Selling general and administrative

Advertising

Acquisition and integration related expenses

Total operating expenses

Income (loss) from operations

Interest expense, net

Income (loss) before income taxes

Income taxes (benefit)

Net income (loss)

Earnings (loss) per share:

Basic

Diluted

Shares used to compute earnings per share:

Basic

Diluted

(in thousands)

Cash and cash equivalents

Trade receivables, net

Inventories

Total current assets

Property, plant and equipment, net

Other intangible assets, net

Goodwill

Current liabilities, excluding debt

Total debt

Stockholders’ equity

(in thousands)

Cash and cash equivalents

Trade receivables, net

Inventories

Total current assets

Property, plant and equipment, net

Other intangible assets, net

Goodwill

Current liabilities, excluding debt

Total debt

Stockholders’ equity

(in thousands, except for per share amounts)

GAAP (loss) before income taxes

Adjustment to exclude acquisition and integration related expenses

Adjustment to exclude certain SG&A costs

Adjustment to exclude forbearance fee

Non-GAAP income (loss) before income taxes

GAAP income taxes (benefit)

Adjustment for tax effect of Non-GAAP adjustments

Non-GAAP income taxes (benefit)

Non-GAAP net income (loss)

Non-GAAP EPS-diluted

Shares used in computing Non-GAAP EPS-diluted *

(in thousands, except for per share amounts)

GAAP income before income taxes

Adjustment to exclude acquisition and integration related expenses

Non-GAAP income before income taxes

GAAP income taxes

Adjustment for tax effect of Non-GAAP adjustments

Non-GAAP income taxes

Non-GAAP net income

Non-GAAP EPS-diluted

Shares used in computing Non-GAAP EPS-diluted *

(in thousands)

Net income (loss)

Income taxes (benefit)

Income (loss) before income taxes

Interest expense, net

Income (loss) from operations (EBIT)

Acquisition and integration related expenses

Certain SG&A costs

Stock-based compensation expense

Depreciation and amortization

Adjusted EBITDA

(in thousands)

Net income

Income taxes

Income before income taxes

Interest expense, net

Income from operations (EBIT)

Acquisition and integration related expenses

Stock-based compensation expense

Depreciation and amortization

Adjusted EBITDA

July 31,

(Restated)

July 31,

(Previously reported)

(in thousands)

Snack

Culinary/Retail in-shell

Total Retail

International Non-Retail

NA Ingredient/Food Service/Other

Total Non-Retail

Total

July 31,

(Restated)

July 31,

(Previously reported)

(in thousands, except per share amounts)