Lancaster Colony Reports First Quarter Fiscal 2014 Results

          Lancaster Colony Reports First Quarter Fiscal 2014 Results

PR Newswire

COLUMBUS, Ohio, Oct. 31, 2013

COLUMBUS, Ohio, Oct. 31, 2013 /PRNewswire/ --Lancaster Colony Corporation
(Nasdaq: LANC) today reported results for its fiscal 2014 first quarter that
ended September 30, 2013:

  oNet sales reached $286 million, off two percent from prior-year first
    quarter sales of $291 million.
  oSpecialty Foods net sales of $248 million were off slightly from the
    year-ago level, reflecting improved foodservice volumes offset by flat
    retail volumes and increased trade promotion costs.
  oGlassware and Candles net sales decreased ten percent from the year-ago
    quarter to $38 million, reflecting a decline in volume.
  oNet income of $24,801,000, or $.91 per diluted share, decreased from the
    prior-year's $26,662,000, or $.98 per diluted share. The lower sales,
    combined with higher trade promotion costs and a less favorable sales mix
    in the Specialty Foods segment, led to this decline.
  oCash dividends were continued at the higher rate set in May 2013. The
    company's debt-free balance sheet reflected $133 million in cash and
    equivalents at September 30, 2013.

Chairman and CEO John B. Gerlach, Jr. said, "While pleased with our overall
market positioning, we saw our first quarter's sales and results affected by a
retail environment that remains challenged. We believe our additional
investments in promotional support behind selected retail food categories such
as refrigerated dressings, croutons and garlic toast helped solidify our
product placement."

Specialty Foods sales benefited from improved volumes of both foodservice and
branded retail product lines, while sales of private label retail product
lines decreased. Additionally, higher trade promotion costs adversely
affected both the segment's net sales and operating results. Specialty Foods
operating income of $39.5 million declined 7.5 percent. As further affected
by the higher foodservice sales mix, segment operating income margins fell to
15.9 percent, compared to 17.2 percent in the prior year. The impact of
fluctuations in product pricing and material costs was not significant.

First quarter candle sales reflected challenging retail conditions, lower
sales of contract-manufactured products and the impact of customer planogram
changes in the prior year. Segment operating income of $1.2 million improved
by approximately $0.6 million as a more favorable product mix offset the
impact of lower net sales.

Mr. Gerlach said, "Looking forward, we expect our seasonally stronger second
quarter will reflect higher food volumes and modestly lower input costs.
Sales of seasonal and contract-manufactured candles will likely reflect
softening, although these product sales tend to be lower-margined in nature.
We believe our continued balance sheet strength allows us considerable
flexibility in supporting our future growth initiatives."

Conference Call on the Web

The company's first quarter conference call is scheduled for this morning,
October 31, 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:

  othe potential for loss of larger programs or key customer relationships;
  othe effect of consolidation of customers within key market channels;
  othe success and cost of new product development efforts;
  othe lack of market acceptance of new products;
  othe reaction of customers or consumers to the effect of price increases we
    may implement;
  ochanges in demand for our products, which may result from loss of brand
    reputation or customer goodwill;
  othe possible occurrence of product recalls or other defective or
    mislabeled product costs;
  oprice and product competition;
  ofluctuations in the cost and availability of raw materials;
  oadverse changes in energy costs and other factors that may affect costs of
    producing, distributing or transporting our products;
  omaintenance of competitive position with respect to other manufacturers,
    including global sources of production;
  odependence on key personnel;
  ostability of labor relations;
  othe uncertainty regarding the effect or outcome of any decision to explore
    further strategic alternativesfor our nonfood operation;
  odependence on contract copackers and limited or exclusive sources for
    certain goods;
  ochanges in estimates in critical accounting judgments;
  othe outcome of any litigation or arbitration; and
  orisks 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.



LANCASTER COLONY CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

(In thousands except per-share amounts)
                                            Three Months Ended
                                            September 30,
                                            2013        2012
Net sales                                   $ 285,856   $ 290,976
Cost of sales                               224,218     225,259
Gross margin                                61,638      65,717
Selling, general & administrative expenses  24,038      25,145
Operating income                            37,600      40,572
Interest income and other – net             (48)        14
Income before income taxes                  37,552      40,586
Taxes based on income                       12,751      13,924
Net income                                  $ 24,801    $ 26,662
Net income per common share:(a)
Net income – basic and diluted              $ 0.91      $ 0.98
Cash dividends per common share             $ 0.40      $ 0.36
Weighted average common shares outstanding:
 Basic                                    27,268      27,229
 Diluted                                  27,312      27,264

(a) Based on the weighted average number of shares outstanding during each
    period.



LANCASTER COLONY CORPORATION

BUSINESS SEGMENT INFORMATION (Unaudited)

(In thousands)
                         Three Months Ended
                         September 30,
                         2013        2012
NET SALES
 Specialty Foods       $ 248,137   $ 248,881
 Glassware and Candles 37,719      42,095
                         $ 285,856   $ 290,976
OPERATING INCOME
 Specialty Foods       $ 39,543    $ 42,758
 Glassware and Candles 1,169       608
 Corporate expenses    (3,112)     (2,794)
                         $ 37,600    $ 40,572



LANCASTER COLONY CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

(In thousands)
                                                    September 30,  June 30,
                                                    2013           2013
ASSETS
Current assets:
 Cash and equivalents                             $   133,075     $ 123,386
 Receivables – net of allowance for doubtful      82,890          70,398
accounts
 Total inventories                                113,047         109,151
 Deferred income taxes and other current assets   18,360          23,123
 Total current assets                          347,372         326,058
Net property, plant and equipment                   186,997         189,695
Other assets                                        104,111         104,211
  Total assets                               $   638,480     $ 619,964
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
 Accounts payable                                 $   41,772      $ 41,890
 Accrued liabilities                              41,789          35,287
 Total current liabilities                     83,561          77,177
Other noncurrent liabilities and deferred income    42,053          41,565
taxes
Shareholders' equity                                512,866         501,222
 Total liabilities and shareholders' equity $   638,480     $ 619,964





SOURCE Lancaster Colony Corporation

Website: http://www.lancastercolony.com
Contact: John L. Boylan, Vice President, Treasurer and CFO, or Dale N.
Ganobsik, Director of Investor Relations, Lancaster Colony Corporation, Phone:
614/224?7141, Email: ir@lancastercolony.com
 
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