Attached files
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| 8-K - FORM 8-K - LANCASTER COLONY CORP | d524718d8k.htm |
Exhibit 99.1
| FOR IMMEDIATE RELEASE | SYMBOL: LANC | |||
| Thursday, April 25, 2013 | TRADED: Nasdaq |
LANCASTER COLONY REPORTS THIRD QUARTER SALES AND EARNINGS
COLUMBUS, Ohio, Apr. 25 — Lancaster Colony Corporation (Nasdaq: LANC) today reported results for the company’s third fiscal quarter ended March 31, 2013. Highlights of the quarter:
| • | Net sales increased three percent to $280 million versus $271 million in the third quarter last year, reflecting growth in Specialty Foods sales. |
| • | Net income totaled $21,833,000 compared with $18,222,000 for the corresponding quarter a year ago, primarily reflecting improved Specialty Foods operating results. Third quarter net income per diluted share totaled $.80 compared to $.67 a year ago. |
| • | Specialty Foods sales increased four percent to a third quarter record of $247.1 million on higher retail volume. The segment’s operating income totaled $33.6 million compared to $29.6 million in the third quarter last year. Contributing to the improved operating results were higher sales, a more favorable sales mix, modestly lower material costs and reduced consumer marketing costs. Pricing was not a material factor in the sales increase. |
| • | Glassware and Candles sales declined four percent to $32.4 million on lower candle volume. However, the segment’s operating income increased to $1.6 million from $1.0 million in the third quarter last year. An improved sales mix helped offset the lower sales. |
| • | The company’s balance sheet remained strong with no debt outstanding at March 31, 2013, and $100.6 million in cash and equivalents. |
| • | The quarterly cash dividend was continued at the higher level of $.38 per share set last quarter, as Lancaster Colony has increased its regular cash dividend each year for 50 consecutive years. |
For the nine months ended March 31, 2013, net sales were $897 million compared to $857 million a year ago. Net income was $83,772,000, or $3.06 per diluted share. Net income for the nine months last year totaled $69,853,000, or $2.56 per diluted share. Current year-to-date net income included pretax income of $0.3 million (one cent per share after taxes) from a second-quarter distribution received under the Continued Dumping and Subsidy Offset Act (CDSOA). In the prior year, net income included a pretax CDSOA distribution of $2.7 million (six cents per share after taxes).
John B. Gerlach, Jr., chairman and CEO, said, “We were again pleased to achieve improved operating income in both our business segments. It was also encouraging to see continued growth in Specialty Foods sales during a period of unsettled consumer demand. Lower material and promotional costs further contributed to the quarterly improvement.”
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Looking ahead, Mr. Gerlach added, “While new products continue to support Specialty Foods sales, fourth quarter comparisons are expected to face the challenges of the strong pace of product rollouts last year, a period of recovery in crouton sales as new production capacity comes online with resumed marketing support, and modest deflation among certain foodservice products. We also plan somewhat higher consumer-directed marketing investment while overall material input costs should be relatively neutral to the prior-year quarter. For our Glassware and Candles segment, the fourth quarter is typically a seasonally slow period. A debt-free balance sheet continues to provide us operating flexibility and a strong base to support our future growth.”
Conference Call on the Web
The company’s third quarter conference call is scheduled for this morning, April 25, at 10:00 a.m. ET. You may access the call through a live webcast by using the link provided on the company’s Internet home page at www.lancastercolony.com. Replays of the webcast will be made available on the company website.
About the Company
Lancaster Colony Corporation is a diversified manufacturer and marketer of consumer products focusing primarily on specialty foods for the retail and foodservice markets.
Forward-Looking Statements
We desire to take advantage of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 (the “PSLRA”). This news release contains various “forward-looking statements” within the meaning of the PSLRA and other applicable securities laws. Such statements can be identified by the use of the forward-looking words “anticipate,” “estimate,” “project,” “believe,” “intend,” “plan,” “expect,” “hope” or similar words. These statements discuss future expectations; contain projections regarding future developments, operations or financial conditions; or state other forward-looking information. Such statements are based upon assumptions and assessments made by us in light of our experience and perception of historical trends, current conditions, expected future developments; and other factors we believe to be appropriate. These forward-looking statements involve various important risks, uncertainties and other factors, many of which are beyond our control, which could cause our actual results to differ materially from those expressed in the forward-looking statements. Some of the key factors that could cause actual results to differ materially from those expressed in the forward-looking statements include:
| • | the potential for loss of larger programs or key customer relationships; |
| • | the effect of consolidation of customers within key market channels; |
| • | the success and cost of new product development efforts; |
| • | the lack of market acceptance of new products; |
| • | the reaction of customers or consumers to the effect of price increases we may implement; |
| • | changes in demand for our products, which may result from loss of brand reputation or customer goodwill; |
| • | the possible occurrence of product recalls or other defective or mislabeled product costs; |
| • | price and product competition; |
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PAGE 3 / LANCASTER COLONY REPORTS THIRD QUARTER SALES AND EARNINGS
| • | fluctuations in the cost and availability of raw materials; |
| • | adverse changes in energy costs and other factors that may affect costs of producing, distributing or transporting our products; |
| • | maintenance of competitive position with respect to other manufacturers, including global sources of production; |
| • | dependence on key personnel; |
| • | stability of labor relations; |
| • | dependence on contract copackers and limited or exclusive sources for certain goods; |
| • | changes in estimates in critical accounting judgments; |
| • | the outcome of any litigation or arbitration; and |
| • | risks related to other factors described under “Risk Factors” in other reports and statements filed by us with the Securities and Exchange Commission, including without limitation our Annual Report on Form 10-K and Quarterly Reports on Form 10-Q (available at www.sec.gov). |
Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update such forward-looking statements, except as required by law. Management believes these forward-looking statements to be reasonable; however, you should not place undue reliance on statements that are based on current expectations.
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| FOR FURTHER INFORMATION: |
John B. Gerlach, Jr., Chairman and CEO, or | |
| John L. Boylan, Vice President, Treasurer and CFO | ||
| Lancaster Colony Corporation | ||
| Phone: 614/224-7141 | ||
| —or— | ||
| Investor Relations Consultants, Inc. | ||
| Phone: 727/781-5577 or E-mail: lanc@mindspring.com |
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PAGE 4 / LANCASTER COLONY REPORTS THIRD QUARTER SALES AND EARNINGS
LANCASTER COLONY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(In thousands except per-share amounts)
| Three Months Ended March 31, |
Nine Months Ended March 31, |
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| 2013 | 2012 | 2013 | 2012 | |||||||||||||
| Net sales |
$ | 279,511 | $ | 271,098 | $ | 896,642 | $ | 857,400 | ||||||||
| Cost of sales |
220,687 | 217,296 | 690,445 | 678,309 | ||||||||||||
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| Gross margin |
58,824 | 53,802 | 206,197 | 179,091 | ||||||||||||
| Selling, general & administrative expenses |
26,517 | 25,848 | 80,693 | 74,915 | ||||||||||||
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| Operating income |
32,307 | 27,954 | 125,504 | 104,176 | ||||||||||||
| Interest income and other – net |
(63 | ) | 39 | 205 | 2,774 | |||||||||||
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| Income before income taxes |
32,244 | 27,993 | 125,709 | 106,950 | ||||||||||||
| Taxes based on income |
10,411 | 9,771 | 41,937 | 37,097 | ||||||||||||
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| Net income |
$ | 21,833 | $ | 18,222 | $ | 83,772 | $ | 69,853 | ||||||||
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| Net income per common share:(a) |
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| Net income – basic and diluted |
$ | .80 | $ | .67 | $ | 3.06 | $ | 2.56 | ||||||||
| Cash dividends per common share |
$ | .38 | $ | .36 | $ | 6.12 | $ | 1.05 | ||||||||
| Weighted average common shares outstanding: |
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| Basic |
27,259 | 27,216 | 27,244 | 27,237 | ||||||||||||
| Diluted |
27,287 | 27,251 | 27,275 | 27,268 | ||||||||||||
| (a) | Based on the weighted average number of shares outstanding during each period. |
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PAGE 5 / LANCASTER COLONY REPORTS THIRD QUARTER SALES AND EARNINGS
LANCASTER COLONY CORPORATION
BUSINESS SEGMENT INFORMATION (Unaudited)
(In thousands)
| Three Months Ended March 31, |
Nine Months Ended March 31, |
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| 2013 | 2012 | 2013 | 2012 | |||||||||||||
| NET SALES |
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| Specialty Foods |
$ | 247,098 | $ | 237,432 | $ | 768,613 | $ | 740,604 | ||||||||
| Glassware and Candles |
32,413 | 33,666 | 128,029 | 116,796 | ||||||||||||
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| $ | 279,511 | $ | 271,098 | $ | 896,642 | $ | 857,400 | |||||||||
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| OPERATING INCOME |
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| Specialty Foods |
$ | 33,648 | $ | 29,561 | $ | 126,790 | $ | 109,510 | ||||||||
| Glassware and Candles |
1,587 | 973 | 7,809 | 2,272 | ||||||||||||
| Corporate expenses |
(2,928 | ) | (2,580 | ) | (9,095 | ) | (7,606 | ) | ||||||||
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| $ | 32,307 | $ | 27,954 | $ | 125,504 | $ | 104,176 | |||||||||
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LANCASTER COLONY CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(In thousands)
| March 31, 2013 |
June 30, 2012 |
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| ASSETS |
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| Current assets: |
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| Cash and equivalents |
$ | 100,611 | $ | 191,636 | ||||
| Receivables – net of allowance for doubtful accounts |
91,705 | 73,326 | ||||||
| Total inventories |
91,508 | 109,704 | ||||||
| Deferred income taxes and other current assets |
23,812 | 17,073 | ||||||
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| Total current assets |
307,636 | 391,739 | ||||||
| Net property, plant and equipment |
191,966 | 184,130 | ||||||
| Other assets |
104,023 | 106,766 | ||||||
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| Total assets |
$ | 603,625 | $ | 682,635 | ||||
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| LIABILITIES AND SHAREHOLDERS’ EQUITY |
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| Current liabilities: |
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| Accounts payable |
$ | 40,171 | $ | 40,708 | ||||
| Accrued liabilities |
35,828 | 31,963 | ||||||
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| Total current liabilities |
75,999 | 72,671 | ||||||
| Other noncurrent liabilities and deferred income taxes |
44,924 | 45,697 | ||||||
| Shareholders’ equity |
482,702 | 564,267 | ||||||
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| Total liabilities and shareholders’ equity |
$ | 603,625 | $ | 682,635 | ||||
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