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Overhill Farms Reports Revenues of $47.6 Million and Net Income of Three Cents per Share for Second Quarter

Overhill Farms Reports Revenues of $47.6 Million and Net Income of Three Cents 
per Share for Second Quarter 
LOS ANGELES, CA -- (Marketwired) -- 05/15/13 --  Overhill Farms, Inc.
(NYSE MKT: OFI) today reported net income of $515,773, or $0.03 per
basic and diluted common share, on net revenues of $47.6 million, for
the second quarter of fiscal 2013, which ended March 31, 2013. This
compares to net income of $974,401, or $0.06 per basic and diluted
common share, on net revenues of $50.2 million, for the second
quarter of fiscal 2012, which ended April 1, 2012. 
In a separate announcement, the Company stated today that it has
entered into a definitive merger agreement for Bellisio Foods, Inc.
to acquire Overhill Farms in a merger transaction valued at
approximately $80.9 million. 
For the second quarter of fiscal year 2013, net revenues decreased
$2.6 million (5.2%) to $47.6 million from $50.2 million for the
second quarter of fiscal year 2012 due primarily to lower sales
volume in the foodservice category. 
By customer category, retail net revenues category increased $633,000
(1.9%) to $32.9 million for the second quarter of fiscal year 2013
from $32.3 million for the second quarter of fiscal year 2012 due
primarily to increased sales of our portion of Boston Market products
of $3.4 million, partially offset by reduced sales to Jenny Craig,
Inc., Safeway Inc. and other retail accounts of $1.2 million, and
$347,000 and $1.2 million, respectively. (The Company has a
co-manufacturing, sales and distribution agreement with Bellisio
Foods, Inc., for the Boston Market line.) 
Foodservice net revenues, including airline revenues, decreased $3.2
million (17.9%) to $14.7 million for the second quarter of fiscal
year 2013 from $17.9 million for the second quarter of fiscal year
2012 due primarily to decreased sales to Panda Restaurant Group, Inc.
of $2.5 million. 
Gross profit for the second quarter of fiscal year 2013 was $4.8
million, compared to $4.7 million for the second quarter of fiscal
year 2012.  
Gross margin increased to 10.2% for the second quarter of fiscal year
2013, from 9.4% for the second quarter of fiscal year 2012, largely
due to more favorable commodity prices and favorable manufacturing
variances partially offset by increased freight and storage expenses. 
Selling, general and administrative expenses increased by $896,000 to
$4.0 million (8.4% of net revenues) for the second quarter of fiscal
year 2013, from $3.1 million (6.2% of net revenues) for the second
quarter of fiscal year 2012, due primarily to higher brokerage and
royalty expenses related to Boston Market products. 
Operating income for the second quarter of fiscal year 2013 was
$863,000 (1.8% of net revenues), down $759,000 compared to operating
income of $1.6 million (3.2% of net revenues) for the second quarter
of fiscal year 2012, due primarily to higher SG&A expenses as noted
above. 
For the first six months of fiscal year 2013, net revenues decreased
$241,000 (0.2%) to $97.5 million from $97.7 million for the first six
months of fiscal year 2012, due to a decrease in retail net revenues
partially offset by an increase in foodservice net revenues.  
Operating income for the first six months of fiscal year 2013 was
$1.4 million (1.4% of net revenues), compared to $3.5 million (3.6%
of net revenues) for the first six months of fiscal year 2012, due
primarily to lower gross profit dollars and increased SG&A expenses.  
Net income for the first six months of fiscal year 2013 was $847,000
or $0.05 per basic and diluted share compared to $2.1 million or
$0.13 per basic and diluted share for the first six months of fiscal
year 2012 due to lower operating income partially offset by a
decrease in income tax expense of $755,000. 
About Overhill Farms 
Overhill Farms, Inc. (www.OverhillFarms.com) is a value-added
manufacturer of custom high quality prepared frozen foods for branded
retail, private label foodservice and airline customers. Its product
line includes entrees, plated meals, bulk-packed meal components,
pastas, soups, sauces, poultry, meat and fish specialties, as well as
organic and vegetarian offerings. The Company's capabilities give its
customers a one-stop solution for new product development, precise
replication of existing recipes, product manufacturing and packaging.
Its customers include prominent nationally recognized names such as
Panda Restaurant Group, Inc., Jenny Craig, Inc., Safeway Inc., Target
Corporation, Pinnacle Foods Group LLC, and American Airlines, Inc.
The Company also sells frozen foods under the Boston Market brand,
under exclusive license with Boston Market Corporation. 
This news release contains disclosures that are forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. These forward-looking statements are based on
current expectations or beliefs and include, but are not limited to,
statements about the Company's operations and financial performance
and condition and statements regarding expectations of continued or
increased sales volumes and revenues, margins, profitability,
production efficiencies and expansions, anticipated freight and
storage costs, cash flows and growth, anticipated amounts and timing
of growth in the Company's customer base and business in the
foodservice and retail market sectors, revenue growth from new
customers, expectations concerning the Company's Boston Market line,
contemplated or potential acquisitions or similar transactions and
general economic pressures. For this purpose, statements of
historical fact may be deemed to be forward-looking statements.
Forward-looking statements include statements which are predictive in
nature, which depend upon or refer to future events or conditions, or
which include words such as "continue," "efforts," "expects,"
"anticipates," "intends," "plans," "believes," "estimates,"
"projects," "forecasts," "strategy," "will," "potential," "may,"
"goal," "target," "prospects," "optimistic," "confident," "likely,"
"probable," "hope," "should," "growth," "opportunities" or similar
expressions. In addition, any statements concerning future financial
performance (including future revenues, earnings or growth rates),
on-going business strategies or prospects, and possible future
company actions, which may be provided by management, are also
forward-looking statements. The Company cautions that these
statements by their nature involve risks and uncertainties, and
actual results may differ materially depending on a variety of
important factors, including, among others: the Company's and other
parties' ability to satisfy conditions precedent to proposed
transactions, including, without limitation, obtaining any applicable
regulatory and stockholder approvals; the impact of competitive
products and pricing; fulfillment by suppliers of existing raw
material contracts; market conditions that may affect the costs
and/or availability of raw materials and the Company's ability to
obtain favorable long-term purchase commitments for raw materials,
and of fuels, energy, logistics and labor as well as the market for
the Company's products, including customers' ability to pay and
consumer demand; changes in business environment, including actions
of competitors and changes in customer preferences, as well as
disruptions to customers' businesses; certifications obtained by
competitors; seasonality in the retail category; loss of key
customers due to competitive environment or production being moved
in-house by customers; natural disasters that can impact, among other
things, costs of fuel and raw materials; the occurrence of acts of
terrorism, such as the events of September 11, 2001, or acts of war;
changes in governmental laws and regulations; change in control due
to takeover or other significant changes in ownership; financial
viability and resulting effect on revenues and collectability of
accounts receivable of customers during deep recessionary periods;
ability to obtain additional financing as and when needed, and rising
costs of credit that may be associated with new borrowings; voluntary
or government-mandated food recalls; and other factors as may be
discussed in the Company's Annual Report on Form 10-K for the year
ended September 30, 2012, Quarterly Report on Form 10-Q for the
quarter ended March 31, 2013, and other reports filed with the
Securities and Exchange Commission. 


 
                                                                            
                                                                            
                            OVERHILL FARMS, INC.                            
                                                                            
                      CONDENSED SUMMARY OF OPERATIONS                       
                                (Unaudited)                                 
                                                                            
                                                    For the Quarter Ended   
                                                 -------------------------- 
                                                   March 31,     April 1,   
                                                     2013          2012     
                                                 ------------  ------------ 
                                                                            
Net revenues                                     $ 47,590,295  $ 50,201,781 
Cost of sales                                      42,749,502    45,498,635 
                                                 ------------  ------------ 
Gross profit                                        4,840,793     4,703,146 
Selling, general and administrative expenses        3,977,367     3,081,145 
                                                 ------------  ------------ 
Operating income                                      863,426     1,622,001 
Total interest expense                                (61,913)      (77,784)
                                                 ------------  ------------ 
Income before income taxes                            801,513     1,544,217 
Income taxes                                          285,740       569,816 
                                                 ------------  ------------ 
Net income                                       $    515,773  $    974,401 
                                                 ============  ============ 
                                                                            
Net income per common share - basic              $       0.03  $       0.06 
                                                 ============  ============ 
Net income per common share - diluted            $       0.03  $       0.06 
                                                 ============  ============ 
                                                                            
Shares used in computing net income per common                              
 share, basic                                      16,046,544    15,823,271 
Weighted average common shares outstanding         16,123,164    16,023,073 
                                                                            
                                                                            
                                                                            
                            OVERHILL FARMS, INC.                            
                                                                            
                      CONDENSED SUMMARY OF OPERATIONS                       
                                (Unaudited)                                 
                                                                            
                                                  For the Six Months Ended  
                                                 -------------------------- 
                                                   March 31,     April 1,   
                                                     2013          2012     
                                                 ------------  ------------ 
                                                                            
Net revenues                                     $ 97,470,289  $ 97,711,491 
Cost of sales                                      89,081,775    88,323,265 
                                                 ------------  ------------ 
Gross profit                                        8,388,514     9,388,226 
Selling, general and administrative expenses        6,949,098     5,895,896 
                                                 ------------  ------------ 
Operating income                                    1,439,416     3,492,330 
Total interest expense                               (123,954)     (174,154)
                                                 ------------  ------------ 
Income before income taxes                          1,315,462     3,318,176 
Income taxes                                          468,962     1,223,783 
                                                 ------------  ------------ 
Net income                                       $    846,500  $  2,094,393 
                                                 ============  ============ 
                                                                            
Net income per common share - basic              $       0.05  $       0.13 
                                                 ============  ============ 
Net income per common share - diluted            $       0.05  $       0.13 
                                                 ============  ============ 
                                                                            
Shares used in computing net income per common                              
 share, basic                                      16,046,544    15,823,271 
Weighted average common shares outstanding         16,123,957    16,016,226 

  
Contacts: 
James Rudis
Chairman, President and CEO
Overhill Farms, Inc.
323-582-9977 
Alexander Auerbach
Auerbach & Co. Public Relations
1-800-871-2583
auerbach@aapr.com 
 
 
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