Breaking News

EU Adds 8 People, 3 Entities to Sanctions Over Ukraine Crisis
Tweet TWEET

Ralcorp Holdings Announces Results for Fourth Quarter and Fiscal 2012

    Ralcorp Holdings Announces Results for Fourth Quarter and Fiscal 2012

-- Net sales up 14% for the year and up 8% in the quarter

-- Adjusted diluted EPS $2.97 for the year, up 11%, and $.71, or flat, in the
quarter

-- Adjusted diluted EPS excluding acquisition-related amortization up 16% for
the year

-- Fiscal 2012 acquisitions contributed approximately $.30 to adjusted diluted
EPS for the year

-- Bloomfield issues, now mitigated, had a $5.8 million negative impact in the
quarter

PR Newswire

ST. LOUIS, Nov. 27, 2012

ST. LOUIS, Nov. 27, 2012 /PRNewswire/ -- Ralcorp Holdings, Inc. (NYSE: RAH)
today reported results for the quarter ended September 30, 2012. Ralcorp's
results include the effects of acquisitions completed during fiscal 2012,
including the North American private-brand refrigerated dough business of Sara
Lee Corp. ("Refrigerated Dough"), Pastificio Annoni S.p.A. ("Annoni"), Petri
Baking Products, Inc. ("Petri"), and Gelit S.r.l. ("Gelit"). The operations
of the Post cereals business are presented as discontinued operations (and
excluded from continuing operations) for all periods. Unless otherwise
indicated, all comparisons of results in the following discussions are for the
fourth quarter ended September 30, 2012 relative to the fourth quarter ended
September 30, 2011.

Executive Summary

                  Three Months Ended              Year Ended
                  September 30,                   September 30,
                  2012         2011     % Change  2012       2011       %
                                                                        Change
(dollars in
millions, except
per share data)
Net Sales         $           $      8%        $         $         14%
                  1,067.3     990.4              4,322.2   3,787.2
Diluted EPS from  $        $               $      $    
Continuing        (.84)         .51    -265%     1.03       2.26       -54%
Operations
Adjusted Diluted
EPS from          $       $     0%        $      $      11%
Continuing        .71           .71              2.97       2.67
Operations
Adjusted Diluted
EPS Excl.         $       $     7%        $      $      16%
Acq.-related      .92           .86              3.79       3.27
Amort.



  oNet Sales grew as a result of acquisitions completed during fiscal 2012,
    primarily Refrigerated Dough and Petri, as well as higher net pricing in
    response to rising commodity costs, partially offset by lower volumes.
  oDiluted Earnings per Share ("EPS") in this year's and last year's fourth
    quarter were negatively impacted by special items as provided for in the
    attached reconciliations of non-GAAP measures, primarily non-cash loss on
    investment in Post, non-cash impairment of intangible assets,
    restructuring and plant closure costs. The effects of all of the special
    items are excluded from adjusted diluted EPS from continuing operations
    ("Adjusted Diluted EPS"). Adjusted diluted EPS excluding
    acquisition-related amortization ("Adjusted Diluted EPS Excl. Acq.-related
    Amort.") excludes the effect of normal amortization of intangible assets
    that are only recorded through business acquisitions (mostly customer
    relationships and trademarks) with a combined impact of $.21 per share and
    $.15 per share in the three months ended September 30, 2012 and 2011,
    respectively.
  oAcquisitions contributed approximately $.05 to Adjusted Diluted EPS for
    the fourth quarter.

Net Sales

                         Three Months Ended         Year Ended
                         September 30,              September 30,
                         2012      2011   % Change  2012      2011      %
                                                                        Change
(dollars in millions)
Base-business Net Sales  $      $    -2%       $        $        5%
                         968.9     990.4            3,964.9  3,787.2
Net sales from recent
acquisitions
excluded from
base-business net sales:
Refrigerated Dough       69.6      -      7%        312.5     -         8%
Petri                    16.1      -      2%        24.6      -         1%
Fiscal 2012 Pasta        12.7      -      1%        20.2      -         0%
acquisitions
Net Sales                $        $    8%        $        $        14%
                         1,067.3  990.4            4,322.2  3,787.2

Net sales increased 8%, due to acquisitions completed in fiscal 2012,
primarily Refrigerated Dough and Petri. Base-business net sales declined 2%
as volumes declined 6% driven by the voluntary resignation from a
co-manufacturing contract in the Cereal Products segment and weakness in our
Snacks, Sauces & Spreads segment. The volume decline was partially offset by
a 4% increase in pricing (and mix) in response to significantly higher raw
material (ingredients and packaging) and freight costs.

Margins

                                            Three Months Ended  Year Ended
                                            September 30,       September 30,
                                            2012       2011     2012    2011
(% of net sales)
Gross Profit                                19.4%      19.4%    20.1%   20.9%
Selling, general and administrative         -10.3%     -10.2%   -10.2%  -10.3%
expenses
Amortization of intangible assets           -2.0%      -1.6%    -2.0%   -1.7%
Impairment of intangible assets             -2.9%      -        -.7%    -
Other operating expenses, net               -2.1%      -.3%     -.9%    -.3%
Operating Profit                            2.1%       7.3%     6.3%    8.6%
Adjusted Gross Profit                       19.2%      20.9%    20.2%   21.5%
Adjustments for economic hedges             .5%        -1.5%    -       -.6%
Abnormal inventory losses                   -.3%       -        -.1%    -
Gross Profit                                19.4%      19.4%    20.1%   20.9%
Adjusted Selling, General & Administrative  -10.0%     -10.2%   -10.0%  -10.3%
Expenses
Merger and integration costs                -          -        -.1%    -
Financial statement restatement costs       -.1%       -        -       -
Restructuring costs                         -.2%       -        -.1%    -
Selling, General & Administrative Expenses  -10.3%     10.2%    -10.2%  10.3%
Adjusted Operating Profit                   7.7%       9.1%     8.3%    9.6%
Adjustments for economic hedges             .5%        -1.5%    -       -.6%
Abnormal inventory losses                   -.3%       -        -.1%    -
Accelerated depreciation and amortization   -.1%       -.1%     -.1%    -.1%
Merger and integration costs                -.1%       -.1%     -.2%    -.1%
Financial statement restatement costs       -.1%       -        -       -
Impairment of intangible assets             -2.9%      -        -.7%    -
Provision for legal settlement              -.2%       -        -.1%    -.1%
Restructuring costs                         -1.3%      -        -.3%    -
Amounts related to plant closures           -1.1%      -.1%     -.5%    -.1%
Operating Profit                            2.1%       7.3%     6.3%    8.6%

Gross profit margin for the fourth quarter of 2012 benefitted from $5.5
million of net adjustments from economic hedge contracts (discussed below),
and was negatively impacted by $2.8 million in abnormal inventory losses and
$.4 million in accelerated depreciation. In the fourth quarter of 2011, gross
profit margin was negatively impacted by $14.9 million of net adjustments for
economic hedge contracts. Excluding the effect of these items, adjusted gross
profit margin decreased from 20.9% last year to 19.2% this year. Adjusted
gross profit margins declined 140 basis points as base-business raw material
and freight costs (net of hedging activities) grew more quickly than
base-business pricing and mix. On a dollar basis, base-business pricing and
mix was unable to offset approximately $51 million in higher raw material and
freight costs, with the most significant impact in snack nuts (included in the
Snacks, Sauces & Spreads segment) and durum wheat (included in the Pasta
segment). Additionally, adjusted gross margins declined by 50 basis points as
a result of costs related to the inefficiencies experienced at the Bloomfield
operations (included in the Cereal Products segment). These declines were
partially offset by the positive impact of our recent acquisitions,
Refrigerated Dough and Petri, which include higher-margin products.

For the fourth quarter of 2012, selling, general and administrative ("SG&A")
expenses were up 10 basis points as a percentage of net sales compared to the
fourth quarter of 2011. The SG&A percentage was negatively impacted by
financial statement restatement costs, merger and integration costs and
restructuring costs in the 2012 quarter. Excluding the effect of these items,
adjusted SG&A expense as a percentage of net sales declined to 10.0% as
compared to 10.2% in the fourth quarter of 2011. The decrease in adjusted
SG&A as a percentage of sales was driven by lower corporate costs (incentive
compensation) and favorable foreign exchange, partially offset by unallocated
Post transition services expenses (the billing for which is recorded in Other
operating expenses, net).

Total amortization expense for the fourth quarter of fiscal 2012 was $21.1
million compared to $16.5 million a year ago. The increase is primarily due
to the acquisitions completed during fiscal 2012. Amortization for the fourth
quarter of fiscal 2012 and 2011 was impacted by accelerated amortization
expense of $.8 million and $1.2 million, respectively, due to a shortened
estimate of the remaining life of a customer relationship intangible asset.

In addition to the items discussed above, the fourth quarter operating profit
margin was affected by amounts related to the impairment of intangible assets,
restructuring costs, plant closures and provision for legal settlement which
are discussed below.

Adjustments for Economic Hedges

Certain derivative contracts do not qualify for cash flow hedge accounting but
are used as economic hedges of Ralcorp's exposure to changes in commodity
costs. Realized and unrealized gains and losses on such contracts are
recognized at a corporate level but not allocated to affect segment operating
profit until the hedged exposure affects earnings. In fiscal 2012, net
mark-to-market adjustments on such derivatives and reclassifications to
segment operating profit resulted in a net gain adjustment for economic hedges
of $5.5 million in the fourth quarter. In the prior year, the corresponding
net loss adjustment for economic hedges was $14.9 million. These net
adjustments were recognized in cost of goods sold on the statement of earnings
but excluded from segment operating profit and the Company's non-GAAP measures
of Adjusted EBITDA, Adjusted Diluted EPS and Adjusted Diluted EPS Excl.
Acq.-related Amort.

Impairment of Intangible Assets

In the fourth quarter of fiscal 2012, Ralcorp recorded a non-cash charge of
$31.6 million related to intangible assets of our Bloomfield operations,
included in the Cereal Products segment. These charges were recorded as a
$28.5 million non-cash impairment of goodwill and a $2.1 million non-cash
impairment of other intangible assets (customer relationships).   

Restructuring Costs

On July 31, 2012, Ralcorp initiated a strategic restructuring to improve
organizational effectiveness and reduce costs. These initiatives are
anticipated to result in one-time pre-tax costs of approximately $26 million
consisting primarily of employee separation and related expenses. During the
three months ended September 30, 2012, Ralcorp recorded $13.8 million of
expenses related to restructuring activities.

Amounts Related to Plant Closures

During the three months ended September 30, 2012 and 2011, Ralcorp recorded
approximately $12.1 million and $1.3 million, respectively, of expenses
related to plant closures (included in "Other operating expenses, net"). In
2012, those costs include primarily losses on and impairments of fixed assets
and employee termination costs related to the closing of the Poteau, Oklahoma
facility (included in the Snacks, Sauces & Spreads segment), Los Alamitos,
California facility (included in the Cereal Products segment) and Delta,
British Columbia facility (included in the Frozen Bakery Products segment).

Other Special Items

In addition to the previous items, the fourth quarter operating profit margin
was affected by merger and integration costs, costs related to the restatement
of our financial statements, a provision for legal settlement primarily
related to the exit of certain customers in our Bloomfield operations, and an
abnormal inventory loss due to product spoilage.

Loss on Investment in Post

We retained a 19.7% ownership interest in Post Holdings, Inc. ("Post") in
conjunction with the separation of the Post brand cereals business. During
the fourth quarter of fiscal 2012, we entered into a short-term borrowing and
a debt exchange agreement which facilitated the tax-free disposition of 100%
of our investment in Post stock, resulting in net cash received of $198.3
million and a non-cash net loss of $48.9 million. The non-cash net loss was
recorded in the statement of operations as "Loss on investment in Post."

Interest Expense and Income Taxes

Interest expense decreased $.8 million for the fourth quarter. The decrease
is due to a $267 million decrease in weighted-average outstanding borrowings
compared to the prior year, partially offset by an increase in the
weighted-average interest rate. The weighted-average interest rate on all of
the Company's outstanding borrowings was 6.0% and 5.6% in the quarters ended
September 30, 2012 and 2011, respectively.

Fourth quarter income taxes decreased $22.6million from expense of $11.9
million last year to a tax benefit of $10.7 million in fiscal 2011 driven by
changes in (loss) earnings before income taxes. This year's effective tax
rate was significantly impacted by a $48.9 million loss on investment in Post,
which is a permanent difference item that does not impact income tax expense.
In addition, fourth quarter income taxes for both years include adjustments to
current and deferred income tax assets and liabilities to revise the estimates
previously recorded to the amounts reflected on recently filed tax returns,
including the effects of lower than anticipated effective state rates. The
fourth quarter of fiscal 2012 also includesthe effects of adjustments to
deferred income tax assets and liabilities due to changes in enacted future
state tax rates. The total impact of these adjustments reduced income tax
expense by $5.8 million in the fourth quarter of fiscal 2012. Management
currently expects the fiscal 2013 overall effective tax rate to be
approximately 34.75%.

Segment Results

                  Three Months Ended              Year Ended
                  September 30,                   September 30,
                  2012         2011     % Change  2012       2011       %
                                                                        Change
(pounds in
millions)
Sales Volume
Cereal Products   118.8        136.9    -13%      497.2      529.0      -6%
Snacks, Sauces &  318.4        334.6    -5%       1,283.2    1,329.5    -3%
Spreads
Frozen Bakery     221.6        168.9    31%       915.6      678.2      35%
Products
Pasta             223.0        214.4    4%        849.2      848.1      0%
Total Sales       881.8        854.8    3%        3,545.2    3,384.8    5%
Volume
(dollars in
millions)
Net Sales
Cereal Products   $         $      -11%      $       $       0%
                  194.1        217.8              835.6      838.5
Snacks, Sauces &  442.4        420.1    5%        1,750.7    1,602.7    9%
Spreads
Frozen Bakery     267.7        194.9    37%       1,104.7    768.6      44%
Products
Pasta             163.1        157.6    3%        631.2      577.4      9%
Total Net Sales   $           $      8%        $         $         14%
                  1,067.3     990.4              4,322.2   3,787.2
Segment Operating
Profit
Cereal Products   $        $     -45%      $      $      -14%
                  10.0         18.1               73.9       86.3
Snacks, Sauces &  33.6         38.8     -13%      140.4      135.5      4%
Spreads
Frozen Bakery     28.1         20.6     36%       111.5      88.0       27%
Products
Pasta             22.5         34.2     -34%      100.4      126.1      -20%
Total Segment     $        $      -16%      $       $       -2%
Operating Profit  94.2         111.7              426.2      435.9
Segment Operating
Profit Margin
Cereal Products   5%           8%                 9%         10%
Snacks, Sauces &  8%           9%                 8%         8%
Spreads
Frozen Bakery     10%          11%                10%        11%
Products
Pasta             14%          22%                16%        22%
Total Segment
Operating Profit  9%           11%                10%        12%
Margin
Depreciation and
Amortization
Cereal Products   $       $     -12%      $      $      -7%
                  4.6           5.2              19.8       21.2
Snacks, Sauces &  12.3         10.5     17%       45.0       41.0       10%
Spreads
Frozen Bakery     17.3         9.6      80%       67.7       39.4       72%
Products
Pasta             13.9         12.8     9%        52.9       52.2       1%
Corporate         2.9          4.0      -28%      13.4       14.0       -4%
Total             $        $               $       $   
Depreciation and  51.0         42.1     21%       198.8      167.8      18%
Amortization

Cereal Products

Net sales declined 11% in the three months ended September 30, 2012 as a 13%
decline in volume driven by the previously announced customer exit was
partially offset by a 2% increase in pricing and mix. Excluding the impact of
the customer exit, net sales were flat as a 6% increase in price and mix was
offset by a 6% decline in volumes. The decreases in volumes for ready-to-eat
and hot cereal were driven by lower promotional support from retailer programs
as compared to last year and weak private-brand category performance.

Fourth quarter segment operating profit decreased 45%, or $8.1 million. Of
the $8.1 million decline, $5.8 was attributable to the inefficiencies and $1.5
to volume loss at our Bloomfield facility. Notable, however, was the positive
performance at Bloomfield in both September of this fiscal year and October of
fiscal 2013. The remainder of the decline was the result of lower volumes in
ready-to-eat and hot cereals, partially offset by lower selling, general and
administrative costs.

Snacks, Sauces & Spreads

Net sales grew 5% in the three months ended September 30, 2012 as improved net
pricing and product mix along with the impact of the Petri acquisition more
than offset a 5% decline in volume. Excluding the impact of the Petri
acquisition, net sales grew 1% as a result of 10% higher pricing and mix which
was mostly offset by a 9% decline in volumes. Volume declines in nut-related
categories accounted for one-third of the segment's volume declines with the
balance of declines mostly in the sauce and spread categories. 

Fourth quarter segment profit declined 13% on the impact of lower volumes and
higher input costs (peanuts, sweeteners, and oils), partially offset by higher
pricing, favorable mix and the acquisition of Petri. Excluding the Petri
acquisition, segment profit declined 17%. 

Frozen Bakery Products

Net sales were up 37% in the three months ended September 30, 2012, primarily
attributable to incremental sales from the acquisition of Refrigerated Dough
which also drove a 31% increase in volume. Excluding results from this
acquisition, base-business net sales were up 2% for the third quarter.
Base-business net sales were driven by increased selling prices in response to
commodity cost increases and a favorable sales mix, partially offset by a 3%
decline in volume. Volume gains from a positive performance in foodservice
were more than offset by the effects of volume declines in retail griddle
products and breads sold to in-store bakery and retail channels.

Fourth quarter segment operating profit grew 36% compared to last year.
Excluding the acquisition of Refrigerated Dough, segment operating profit
increased 8%, driven by improved selling prices and mix, positive
manufacturing rates, and favorable foreign exchange rate, partially offset by
higher raw material costs (primarily flour and oil) and lower volumes.

Pasta

Net sales were up 3% for the three months ended September 30, 2012, partially
attributable to incremental sales from the acquisitions of Annoni and Gelit.
Volume for the quarter was up 4%. Excluding results from these acquisitions,
base-business net sales were down 5% in the fourth quarter. The decrease in
net sales is primarily due to lower net selling prices in response to falling
raw materials costs, and a 1% volume decline. Significant volume declines in
the ingredients business and a modest decline in branded pasta were
essentially offset by volume increases in foodservice products. 

Segment operating profit for the fourth quarter decreased 34% due to net
selling price decreases and unfavorable commodity contracts. Lower selling,
general and administrative costs, improved manufacturing performance, and
acquisitions partially offset the decrease.

Conference call

As separately announced today, ConAgra Foods and Ralcorp have entered into a
definitive merger agreement under which ConAgra Foods will acquire all of the
outstanding shares of Ralcorp for $90.00 per share in cash. In light of this
announcement, Ralcorp has canceled its Fiscal 2012 earnings conference call,
scheduled for today, November 27, 2012.

Non-GAAP Measures and Additional Information

The non-GAAP financial measures presented herein (including "base-business net
sales" and measures labeled as "adjusted") do not comply with accounting
principles generally accepted in the United States, or GAAP, because they are
adjusted to exclude (include) certain cash and non-cash income and expenses
that would otherwise be included in (excluded from) the most directly
comparable GAAP measure in the statement of earnings. These non-GAAP
financial measures, which are not necessarily comparable to similarly titled
captions of other companies due to potential inconsistencies in the methods of
calculation, should not be considered an alternative to, or more meaningful
than, related measures determined in accordance with GAAP. These non-GAAP
measures supplement other metrics used by management to internally evaluate
its businesses and facilitate the comparison of operations over time.

For additional information regarding the Company's results, including
reconciliations of non-GAAP measures to related GAAP measures, refer to the
schedules below.

Cautionary Statement on Forward-Looking Statements

Forward-looking statements, within the meaning of Section 21E of the
Securities Exchange Act of 1934, are made throughout this release. These
forward-looking statements are sometimes identified by the use of terms and
phrases such as "believe," "should," "would," "expect," "project," "estimate,"
"anticipate," "intend," "plan," "will," "can," "may," or similar expressions
elsewhere in this release. All forward-looking statements are subject to a
number of important factors, risks, uncertainties and assumptions that could
cause actual results to differ materially from those described in any
forward-looking statements. These factors and risks include, but are not
limited to, general economic conditions, changes in actual or forecasted
results of operations, competitive pressures, future sales volume, significant
increases in the costs of certain raw materials, inability to affect future
price increases or cost reduction programs, changes in tax laws, integration
of recent acquisitions and related accretion, future capital expenditures,
changes in weighted average shares for diluted EPS, increases in
transportation costs, and other financial, operational and legal risks and
uncertainties detailed from time to time in the Company's cautionary
statements contained in its filings with the Securities and Exchange
Commission. The Company disclaims and does not undertake any obligation to
update or revise any forward-looking statement in this press release.

About Ralcorp Holdings, Inc.

Ralcorp produces a variety of private‐brand foods sold under the individual
labels of various grocery, mass merchandise and drugstore retailers, and
frozen bakery products sold to in-store bakeries, restaurants and other
foodservice customers. Ralcorp's diversified product mix includes:
ready‐to‐eat and hot cereals; nutritional and cereal bars; snack mixes,
corn‐based chips and extruded corn snack products; crackers and cookies; snack
nuts; chocolate candy; salad dressings; mayonnaise; peanut butter; jams and
jellies; syrups; sauces; frozen griddle products including pancakes, waffles,
and French toast; frozen biscuits and other frozen pre‐baked products such as
breads and muffins; frozen and refrigerated doughs; dry pasta; and frozen
pasta meals. For more information about Ralcorp, visit the Company's website
at www.ralcorp.com.

RALCORP HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited)
(Dollars in millions except per share data)
                         Three Months Ended         Year Ended
                         September 30,              September 30,
                         2012          2011         2012          2011
Net Sales                $  1,067.3  $   990.4  $  4,322.2  $  3,787.2
Cost of goods sold       (860.0)       (798.1)      (3,455.5)     (2,996.0)
Gross Profit             207.3         192.3        866.7         791.2
Selling, general and     (109.8)       (100.9)      (440.6)       (388.1)
administrative expenses
Amortization of          (21.1)        (16.5)       (82.3)        (65.6)
intangible assets
Impairment of intangible (30.6)        -            (30.6)        -
assets
Other operating          (23.2)        (2.8)        (40.1)        (11.3)
expenses, net
Operating Profit         22.6          72.1         273.1         326.2
Loss on investment in    (48.9)        -            (48.9)        -
Post
Interest expense, net    (30.7)        (31.5)       (127.5)       (134.0)
(Loss) Earnings from
Continuing Operations    (57.0)        40.6         96.7          192.2
before Income Taxes
Income taxes             10.7          (11.9)       (39.1)        (65.9)
(Loss) Earnings from     (46.3)        28.7         57.6          126.3
Continuing Operations
Earnings (loss) from
discontinued operations,
net
of income taxes          2.1           (452.8)      15.8          (367.5)
Net (Loss) Earnings      $          $  (424.1)  $         $  
                         (44.2)                     73.4          (241.2)
Basic Earnings per
Share
(Loss) earnings from     $         $        $         $    
continuing operations    (.84)         .52          1.04          2.30
Earnings (loss) from     .04           (8.22)       .29           (6.69)
discontinued operations
Net (loss) earnings      $         $          $         $   
                         (.80)         (7.70)       1.33          (4.39)
Diluted Earnings per
Share
(Loss) earnings from     $         $        $         $    
continuing operations    (.84)         .51          1.03          2.26
Earning (loss) from      .04           (8.05)       .28           (6.58)
discontinued operations
Net (loss) earnings      $         $          $         $   
                         (.80)         (7.54)       1.31          (4.32)
Weighted Average Shares
Outstanding
Basic                    55,118        54,926       55,150        54,812
Diluted                  56,026        56,060       56,146        55,726



RALCORP HOLDINGS, INC.
UNAUDITED RECONCILIATIONS OF NON-GAAP MEASURES
(Dollars in millions except per share data)
                                    Three Months Ended    Year Ended
                                    September 30,         September 30,
                                    2012       2011       2012       2011
Adjusted Diluted EPS Excl.          $      $      $      $    
Acquisition-related Amortization     .92      .86        3.79       3.27
Acquisition-related amortization    (.21)      (.15)      (.82)      (.60)
(excl. accelerated amortization)
Adjusted Diluted EPS                $      $      $      $    
                                     .71      .71        2.97       2.67
Adjustments for economic hedges     .06        (.17)      .01        (.25)
Abnormal inventory losses           (.03)      -          (.03)      -
Merger and integration costs        (.01)      -          (.12)      (.02)
Financial statement restatement     (.02)      -          (.02)      -
costs
Accelerated depreciation and        (.01)      (.01)      (.07)      (.06)
amortization
Impairment of intangible assets     (.35)      -          (.35)      -
Provision for legal settlement      (.02)      -          (.07)      (.03)
Restructuring costs                 (.15)      -          (.15)      -
Amounts related to plant closures   (.14)      (.02)      (.27)      (.05)
Loss on investment in Post          (.87)      -          (.87)      -
Effect of excluding potentially
dilutive securities which
were antidilutive for GAAP purposes (.01)      -          -          -
due to net loss
Diluted EPS from Continuing         $      $      $      $    
Operations                          (.84)      .51        1.03       2.26
Adjusted EBITDA                     $       $        $       $   
                                    130.9      131.3      559.6      524.5
Interest expense, net               (30.7)     (31.5)     (127.5)    (134.0)
Income taxes                        10.7       (11.9)     (39.1)     (65.9)
Depreciation and amortization       (51.0)     (42.1)     (198.8)    (167.8)
Adjustments for economic hedges     5.5        (14.9)     .6         (21.8)
Abnormal inventory losses           (2.8)      -          (2.8)      -
Merger and integration costs        (.6)       (1.0)      (10.4)     (2.5)
Financial statement restatement     (1.5)      -          (1.5)      -
costs
Impairment of intangible assets     (30.6)     -          (30.6)     -
Provision for legal settlement      (1.8)      -          (6.2)      (2.5)
Restructuring costs                 (13.4)     -          (13.4)     -
Amounts related to plant closures   (12.1)     (1.2)      (23.4)     (3.7)
(excl. depreciation)
Loss on investment in Post          (48.9)     -          (48.9)     -
(Loss) Earnings from Continuing     $       $       $      $   
Operations                          (46.3)     28.7       57.6       126.3
Total Segment Operating Profit      $      $        $       $   
                                    94.2       111.7      426.2      435.9
Interest expense, net               (30.7)     (31.5)     (127.5)    (134.0)
Adjustments for economic hedges     5.5        (14.9)     .6         (21.8)
Abnormal inventory losses           (2.8)      -          (2.8)      -
Accelerated depreciation and        (1.2)      (1.2)      (6.2)      (5.0)
amortization
Merger and integration costs        (.6)       (1.0)      (10.4)     (2.5)
Financial statement restatement     (1.5)      -          (1.5)      -
costs
Impairment of intangible assets     (30.6)     -          (30.6)     -
Provision for legal settlement      (1.8)      -          (6.2)      (2.5)
Restructuring costs (excl.          (13.8)     -          (13.8)     -
stock-based compensation)
Amounts related to plant closures   (12.1)     (1.3)      (23.6)     (4.1)
Loss on investment in Post          (48.9)     -          (48.9)     -
Stock-based compensation expense    (2.7)      (4.1)      (15.7)     (14.8)
Systems upgrade and conversion      (1.8)      (2.3)      (6.6)      (7.7)
costs
Other unallocated corporate         (8.2)      (14.8)     (36.3)     (51.3)
expenses
(Loss) Earnings from Continuing     $       $       $      $   
Operations before Income Taxes      (57.0)     40.6       96.7       192.2

Contact: Matt Pudlowski (314/877-7091)

SOURCE Ralcorp Holdings, Inc.

Website: http://www.ralcorp.com