Lancaster Colony Reports Third Quarter Sales And Earnings PR Newswire COLUMBUS, Ohio, May 1, 2014 COLUMBUS, Ohio, May 1, 2014 /PRNewswire/ --Lancaster Colony Corporation (Nasdaq: LANC) today reported results for the company's third fiscal quarter ended March31, 2014. All prior-period financial results of the Glassware and Candles segment have been reclassified to discontinued operations due to the sale of effectively all the net operating assets of this segment on January 30, 2014. Highlights of the quarter: oNet sales decreased two percent to $242million versus $247million in the third quarter last year due to lower sales of frozen retail products, in part due to the influence of this year's later Easter. Also impacting net sales was somewhat lower pricing to the foodservice channel and the effect of adverse winter weather on consumer demand. oIncome from continuing operations was $18,900,000 compared with $20,733,000 for the corresponding quarter a year ago, primarily reflecting lower sales, a less favorable sales mix and a higher effective tax rate. Earnings per share from continuing operations were 69 cents compared to 76 cents a year ago. oIncluding the loss from discontinued operations of $29.3 million or $1.07 per share, which incorporated a pre-tax loss of approximately $44 million on the sale of the company's candle manufacturing and marketing operations, the reported net loss for the quarter totaled $10.4 million, or $.38 per share. In the third quarter a year ago, net income totaled $21.8 million, or $.80 per share, inclusive of income from discontinued operations of $1.1 million, or $.04 per share. oThe company's balance sheet remained strong with no debt outstanding at March31, 2014, and $201 million in cash and equivalents. oThe quarterly cash dividend was continued at the higher level of $.44 per share set last quarter, as Lancaster Colony has increased its regular cash dividend each year for 51 consecutive years. For the nine months ended March31, 2014, net sales were $782million compared to $769million a year ago. Income from continuing operations totaled $80,085,000 or $2.93 per share. Net income was $53.7 million or $1.96 per diluted share. Net of tax, the loss from discontinued operations, including the loss on sale, totaled $26.4 million, or $.97 per share. Income from continuing operations in the year ago nine-month period was $78,459,000, or $2.87 per share. Income from discontinued operations totaled $5.3 million, or $.19 per diluted share. Net income for the nine months last year totaled $83.8 million or $3.06 per share. John B. Gerlach, Jr., chairman and CEO, said, "For the quarter, the benefit from lower net material costs was more than offset by the impact of lower net sales and a less-favorable sales mix as the segment's operating income declined seven percent. Additionally, as influenced by the adverse weather conditions, we also experienced incremental costs associated with freight and operational downtime." Looking ahead, Mr. Gerlach added, "We anticipate comparative results of the fourth quarter to be bolstered by the shift in Easter's timing, the continued favorability in material costs and modest benefit from new products being brought to market in both our retail and foodservice sales channels. However, we anticipate somewhat higher overall marketing costs and expect our investment in introductory costs associated with several of the new products to be significant. We also remain generally cautious regarding consumer sentiment. Regardless, our debt-free balance sheet allows us to retain a considerable amount of operating flexibility supportive of long-term future growth." Conference Call on the Web The company's third quarter conference call is scheduled for this morning, May 1, at 10:00a.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 manufacturer and marketer of specialty food products 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; odependence on key personnel; ostability of labor relations; 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) (b) (In thousands except per-share amounts) Three Months Ended Nine Months Ended March 31, March 31, 2014 2013 2014 2013 Net sales $ 241,849 $ 247,098 $ 782,267 $ 768,613 Cost of sales 189,941 193,265 591,565 581,613 Gross margin 51,908 53,833 190,702 187,000 Selling, general & 23,073 23,113 69,251 69,305 administrative expenses Operating income 28,835 30,720 121,451 117,695 Interest income and (204) (15) (328) (6) other – net Income from continuing operations before 28,631 30,705 121,123 117,689 income taxes Taxes based on income 9,731 9,972 41,038 39,230 Income from continuing 18,900 20,733 80,085 78,459 operations Discontinued operations, net of tax: Income from 325 1,100 3,175 5,313 discontinued operations Loss on sale of (29,601) — (29,601) — discontinued operations Total discontinued (29,276) 1,100 (26,426) 5,313 operations Net (loss) income $ (10,376) $ 21,833 $ 53,659 $ 83,772 Net income (loss) per common share:(a) Continuing operations - $ 0.69 $ 0.76 $ 2.93 $ 2.87 basic and diluted Discontinued operations $ (1.07) $ 0.04 $ (0.97) $ 0.20 - basic Discontinued operations $ (1.07) $ 0.04 $ (0.97) $ 0.19 - diluted Net (loss) income - $ (0.38) $ 0.80 $ 1.97 $ 3.06 basic Net (loss) income - $ (0.38) $ 0.80 $ 1.96 $ 3.06 diluted Cash dividends per $ 0.44 $ 0.38 $ 1.28 $ 6.12 common share Weighted average common shares outstanding: Basic 27,261 27,259 27,258 27,244 Diluted 27,297 27,287 27,303 27,275 (a) Based on the weighted average number of shares outstanding during each period. (b) Certain glassware and candles operations have been reflected as discontinued operations in all periods presented. LANCASTER COLONY CORPORATION BUSINESS SEGMENT INFORMATION (Unaudited) (b) (In thousands) Three Months Ended Nine Months Ended March 31, March 31, 2014 2013 2014 2013 NET SALES - Specialty Foods $ 241,849 $ 247,098 $ 782,267 $ 768,613 OPERATING INCOME Specialty Foods $ 31,408 $ 33,648 $ 130,364 $ 126,790 Corporate expenses (2,573) (2,928) (8,913) (9,095) $ 28,835 $ 30,720 $ 121,451 $ 117,695 LANCASTER COLONY CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (b) (In thousands) March 31, June 30, 2014 2013 ASSETS Current assets: Cash and equivalents $ 201,328 $ 123,385 Receivables – net of allowance for doubtful accounts 61,756 56,337 Total inventories 67,737 67,809 Deferred income taxes and other current assets 33,312 22,550 Current assets of discontinued operations — 55,977 Total current assets 364,133 326,058 Net property, plant and equipment 163,986 168,074 Other assets 102,146 103,231 Noncurrent assets of discontinued operations — 22,601 Total assets $ 630,265 $ 619,964 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $ 40,261 $ 36,459 Accrued liabilities 30,452 32,602 Current liabilities of discontinued operations — 8,116 Total current liabilities 70,713 77,177 Other noncurrent liabilities and deferred income taxes 41,043 41,565 Shareholders' equity 518,509 501,222 Total liabilities and shareholders' equity $ 630,265 $ 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, 614/224?7141, firstname.lastname@example.org
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Lancaster Colony Reports Third Quarter Sales And Earnings
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