B&G Foods Reports Strong First Quarter Net Sales and Earnings Growth — Increases Fiscal 2013 Guidance — Business Wire PARSIPPANY, N.J. -- April 18, 2013 B&G Foods, Inc. (NYSE: BGS) today announced financial results for the first quarter of 2013. Highlights (vs. year-ago quarter where applicable): *Net sales increased 8.8% to $171.2 million *Net income increased 17.0% to $19.6 million *Diluted earnings per share increased 5.7% to $0.37 *EBITDA^* increased 7.2% to $45.7 million *EBITDA guidance increased to a range of approximately $180.0 million to $184.0 million for the full year David L. Wenner, President and Chief Executive Officer of B&G Foods, stated, “Our business performed very well in the first quarter, growing by 8.8% via a healthy mix of base business volume gains and acquisition growth. The New York Style and Old London acquisition completed in October 2012 performed to expectations in both sales and earnings. Growth in the base business came from our top two tiers of brands, which together contributed a 3.0% net sales gain for the quarter.” Financial Results for the First Quarter of 2013 Net sales for the first quarter of 2013 increased $13.9 million, or 8.8%, to $171.2 million from $157.3 million for the first quarter of 2012. Net sales of the New York Style and Old London brands, which B&GFoods acquired at the end of October 2012, contributed $11.3 million to the overall increase. Net sales from our base business increased $2.6 million, or 1.6%, of which $2.5 million was attributable to a unit volume increase and $0.1 million was attributable to net price increases. Gross profit for the first quarter of 2013 increased 3.5% to $58.8 million from $56.8 million in the first quarter of 2012. Gross profit expressed as a percentage of net sales decreased 1.7 percentage points to 34.4% for the first quarter of 2013 from 36.1% in the first quarter of 2012. The decrease in gross profit expressed as a percentage of net sales was primarily attributable to the full quarter effect of the NewYorkStyle and Old London brands accounting for 0.8 percentage points of the decrease. Increased trade spending accounted for 0.3 percentage points of the decline, with the remainder related to a sales mix shift to lower margin products. Operating income increased 5.4% to $40.2 million for the first quarter of 2013, from $38.2 million in the first quarter of 2012. Net interest expense for the first quarter of 2013 decreased $2.2 million or 18.5% to $9.8 million from $12.0 million for the first quarter of 2012. The decrease in net interest expense for the first quarter was primarily attributable to our redemption of $101.5 million principal amount of our outstanding senior notes in December 2012 and scheduled principal payments on our tranche A and tranche B term loans. The Company’s reported net income under U.S. generally accepted accounting principles (GAAP) was $19.6 million, or $0.37 per diluted share, for the first quarter of 2013, as compared to reported net income of $16.8 million, or $0.35 per diluted share, for the first quarter of 2012. For the first quarter of 2013, EBITDA increased 7.2% to $45.7 million from $42.6 million for the first quarter of 2012. Guidance B&G Foods increased its EBITDA guidance for fiscal 2013 to a range of approximately $180.0 million to $184.0 million. Conference Call B&G Foods will hold a conference call at 4:30 p.m. ET today, April 18, 2013. The call will be webcast live from B&G Foods’ website at www.bgfoods.com under “Investor Relations—Company Overview.” The call can also be accessed live over the phone by dialing (888) 299-7207 for U.S. callers or (719) 325-4855 for international callers. A replay of the call will be available one hour after the call and can be accessed by dialing (877) 870-5176 or (858)384-5517 for international callers; the password is 3742986. The replay will be available from April 18,2013, through May 2, 2013. Investors may also access a web-based replay of the call at the Investor Relations section of B&G Foods’ website, www.bgfoods.com. * Please see “About Non-GAAP Financial Measures” below for the definition of the term EBITDA and a reconciliation of EBITDA to the most comparable GAAP financial measures. About Non-GAAP Financial Measures “EBITDA” (net income before net interest expense, income taxes, depreciation and amortization and loss on extinguishment of debt) is a “non-GAAP financial measure.” A non-GAAP financial measure is a numerical measure of financial performance that excludes or includes amounts so as to be different than the most directly comparable measure calculated and presented in accordance with GAAP in B&G Foods’ consolidated balance sheets and related consolidated statements of operations, comprehensive income, changes in stockholders’ equity and cash flows. Non-GAAP financial measures should not be considered in isolation or as a substitute for the most directly comparable GAAP measures. The Company’s non-GAAP financial measures may be different from non-GAAP financial measures used by other companies. Additional information regarding EBITDA, and a reconciliation of EBITDA to net income and to net cash provided by operating activities is included below for the first quarters of 2013 and 2012, along with the components of EBITDA. About B&G Foods, Inc. B&G Foods and its subsidiaries manufacture, sell and distribute a diversified portfolio of high-quality, shelf-stable foods across the United States, Canada and Puerto Rico. Based in Parsippany, New Jersey, B&G Foods’ products are marketed under many recognized brands, including Ac’cent, B&G,B&M, Baker’s Joy, Brer Rabbit, Cream of Rice, Cream of Wheat, Devonsheer, Don Pepino, Emeril’s, Grandma’s Molasses, JJ Flats, Joan of Arc, Las Palmas, MapleGroveFarmsofVermont, MollyMcButter, Mrs. Dash, New York Style, Old London, Ortega, Polaner, Red Devil, Regina, Sa-són, Sclafani, Sugar Twin, Trappey’s, Underwood, Vermont Maid and Wright’s. B&G Foods also sells and distributes two branded household products, Static Guard and Kleen Guard. Forward-Looking Statements Statements in this press release that are not statements of historical or current fact constitute “forward-looking statements.” The forward-looking statements contained in this press release include, without limitation, statements related to B&G Foods’ EBITDA expectations for fiscal 2013. Such forward-looking statements involve known and unknown risks, uncertainties and other unknown factors that could cause the actual results of B&G Foods to be materially different from the historical results or from any future results expressed or implied by such forward-looking statements. In addition to statements that explicitly describe such risks and uncertainties readers are urged to consider statements labeled with the terms “believes,” “belief,” “expects,” “projects,” “intends,” “anticipates” or “plans” to be uncertain and forward-looking. The forward-looking statements contained herein are also subject generally to other risks and uncertainties that are described from time to time in B&G Foods’ filings with the Securities and Exchange Commission, including under Item 1A, “Risk Factors” in the Company’s most recent Annual Report on Form 10-K and in its subsequent reports on Form 10-Q and 8-K. Investors are cautioned not to place undue reliance on any such forward looking statements, which speak only as of the date they are made. B&GFoods undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. B&G Foods, Inc. and Subsidiaries Consolidated Balance Sheets (In thousands, except share and per share data) (Unaudited) Assets March 30, 2013 December 29, 2012 Current assets: Cash and cash equivalents $ 16,146 $ 19,219 Trade accounts receivable, net 46,816 43,357 Inventories 87,747 89,757 Prepaid expenses and other current 4,221 5,326 assets Income tax receivable 3,347 4,262 Deferred income taxes 2,079 2,175 Total current assets 160,356 164,096 Property, plant and equipment, net of accumulated depreciation of $103,936 103,098 104,746 and $100,625 Goodwill 267,940 267,940 Other intangibles, net 635,129 637,196 Other assets 17,152 17,990 Total assets $ 1,183,675 $ 1,191,968 Liabilities and Stockholders’ Equity Current liabilities: Trade accounts payable $ 23,208 $ 25,050 Accrued expenses 16,929 23,610 Current portion of long-term debt 37,937 40,375 Dividends payable 15,329 15,243 Total current liabilities 93,403 104,278 Long-term debt 593,175 597,314 Other liabilities 7,380 8,038 Deferred income taxes 125,897 121,163 Total liabilities 819,855 830,793 Commitments and contingencies Stockholders’ equity: Preferred stock, $0.01 par value per share. Authorized 1,000,000 shares; — — no shares issued or outstanding Common stock, $0.01 par value per share. Authorized 125,000,000 shares; 52,858,772 and 52,560,765 shares 529 526 issued and outstanding as of March 30, 2013 and December 29, 2012 Additional paid-in capital 209,775 226,900 Accumulated other comprehensive loss (10,962 ) (11,095 ) Retained earnings 164,478 144,844 Total stockholders’ equity 363,820 361,175 Total liabilities and stockholders’ $ 1,183,675 $ 1,191,968 equity B&G Foods, Inc. and Subsidiaries Consolidated Statements of Operations (In thousands, except per share data) (Unaudited) Thirteen Weeks Ended March 30, 2013 March 31, 2012 Net sales $ 171,194 $ 157,339 Cost of goods sold 112,382 100,514 Gross profit 58,812 56,825 Operating expenses: Selling, general and administrative 16,508 16,640 expenses Amortization expense 2,067 2,022 Operating income 40,237 38,163 Other expenses: Interest expense, net 9,773 11,989 Income before income tax expense 30,464 26,174 Income tax expense 10,830 9,396 Net income $ 19,634 $ 16,778 Weighted average shares outstanding: Basic 52,715 48,039 Diluted 52,942 48,337 Basic and diluted earnings per share $ 0.37 $ 0.35 Cash dividends declared per share $ 0.29 $ 0.27 B&G Foods, Inc. and Subsidiaries Reconciliation of EBITDA to Net Income and to Net Cash Provided by Operating Activities (In thousands) (Unaudited) Thirteen Weeks Ended March 30, 2013 March 31, 2012 Net income $ 19,634 $ 16,778 Income tax expense 10,830 9,396 Interest expense, net 9,773 11,989 Depreciation and amortization 5,420 4,441 Loss on extinguishment of debt — — EBITDA^(1) 45,657 42,604 Income tax expense (10,830 ) (9,396 ) Interest expense, net (9,773 ) (11,989 ) Deferred income taxes 4,742 4,153 Amortization of deferred financing costs 1,175 1,257 and bond discount Share-based compensation expense 670 740 Excess tax benefits from share-based (4,349 ) (8,118 ) compensation Changes in assets and liabilities (4,185 ) 1,734 Net cash provided by operating $ 23,107 $ 20,985 activities EBITDA is a non-GAAP financial measure used by management to measure operating performance. A non-GAAP financial measure is defined as a numerical measure of our financial performance that excludes or includes amounts so as to be different than the most directly comparable measure calculated and presented in accordance with GAAP in our consolidated balance sheets and related consolidated statements of operations, comprehensive income, changes in stockholders’ equity and cash flows. We define EBITDA as net income before net interest expense, income taxes, depreciation and amortization and loss on extinguishment of debt. Management believes that it is useful to eliminate net interest expense, income taxes, depreciation and amortization and loss on extinguishment of debt because it allows management to focus on what it deems to be a more reliable indicator of ongoing operating performance and our ability (1) to generate cash flow from operations. We use EBITDA in our business operations, to among other things, evaluate our operating performance, develop budgets and measure our performance against those budgets, determine employee bonuses and evaluate our cash flows in terms of cash needs. We also present EBITDA because we believe it is a useful indicator of our historical debt capacity and ability to service debt and because covenants in our credit agreement and our senior notes indenture contain ratios based on this measure. As a result, internal management reports used during monthly operating reviews feature the EBITDA metric. However, management uses this metric in conjunction with traditional GAAP operating performance and liquidity measures as part of its overall assessment of company performance and liquidity and therefore does not place undue reliance on this measure as its only measure of operating performance and liquidity. EBITDA is not a recognized term under GAAP and does not purport to be an alternative to operating income or net income as an indicator of operating performance or any other GAAP measure. EBITDA is not a complete net cash flow measure because EBITDA is a measure of liquidity that does not include reductions for cash payments for an entity’s obligation to service its debt, fund its working capital, capital expenditures and acquisitions and pay its income taxes and dividends. Rather, EBITDA is a potential indicator of an entity’s ability to fund these cash requirements. EBITDA is not a complete measure of an entity’s profitability because it does not include costs and expenses for depreciation and amortization, interest and related expenses, loss on extinguishment of debt and income taxes. Because not all companies use identical calculations, this presentation of EBITDA may not be comparable to other similarly titled measures of other companies. However, EBITDA can still be useful in evaluating our performance against our peer companies because management believes this measure provides users with valuable insight into key components of GAAP amounts. Contact: ICR, Inc. Investor Relations: Don Duffy, 866-211-8151 or Media Relations: Matt Lindberg, 203-682-8214
B&G Foods Reports Strong First Quarter Net Sales and Earnings Growth
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