B&G Foods Reports Strong First Quarter Net Sales and Earnings Growth

  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
 
Press spacebar to pause and continue. Press esc to stop.