SNYDERS-LANCE CHARLOTTE, N.C., Aug. 10, 2015 /PRNewswire/ -- Snyder's-Lance, Inc. (Nasdaq-GS: LNCE) today reported second quarter net revenue growth of 8% over last year, with earnings of $0.27 per diluted share excluding special items and $0.24 per diluted share including special items.
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"Our team delivered solid results for the second quarter, continuing our positive momentum for 2015. Our balanced portfolio of 'better for you' and premium products are winning with consumers looking for snacks that taste great and provide fuel for their busy day," said Carl E. Lee, Jr., President and CEO. "During the second quarter, core brand sales were led by Cape Cod(®) Kettle Chips which grew at double digits. Snyder's of Hanover(®) pretzels gained significant market share during the quarter thanks to innovative new products and our new advertising campaign, 'Discover the Pretzelbilities'(TM). Snack Factory(®) Pretzel Crisps(®) and Late July(®) both delivered strong top line performance and market share gains driven by the Clearview Division team. Lance(®) sandwich crackers gained market share over the latest 26 weeks, led by our balanced distribution strategy of leveraging DSD and Direct Sales to improve retail execution and reach new customers. During the second quarter, we secured new distribution for Lance(® )driving incremental growth for this renovated brand. Expense control across the company has been a focus all year contributing to operating margin expansion for the quarter. In addition, we accomplished two significant system implementations that came online flawlessly in the second quarter, showing once again our excellence in this area. Overall, we had a good quarter and I am very proud of our team for their commitment to winning."
Mr. Lee continued, "Snyder's-Lance is perfectly positioned for success as consumers and retailers continue to reshape the snacking industry. As a nimble mid-size company, we are able to respond quickly to emerging trends with our balanced portfolio and balanced distribution strategies. While the commitment to innovation and the growth of our brands is stronger than ever, we are just as determined to continue our focus on cost reductions. We have balanced our execution over the past few years to invest in manufacturing capacity, brands, systems, R&D, sales teams and productivity while increasing our margins. With most of the renovation and investment in infrastructure behind us, we are spending even more time on expanding margins and driving shareholder value. We are enthusiastic about the future as we build on our momentum."
Second Quarter Financial Summary
-- Net revenue for the second quarter of 2015 was $431.4 million, an
increase of 8.0% compared to second quarter of 2014 net revenue of
$399.6 million.
-- Net income excluding special items for the second quarter of 2015 was
$19.1 million, or $0.27 per diluted share, as compared to net income
excluding special items of $15.8 million for the second quarter of 2014,
or $0.22 per diluted share.
-- Including special items, net income for the second quarter of 2015 was
$17.3 million, or $0.24 per diluted share, as compared to net income
including special items of $8.2 million for the second quarter of 2014,
or $0.11 per diluted share.
-- Special items for the second quarter of 2015 included after-tax expenses
of $1.8 million primarily associated with legal fees and an accrual for
the likely settlement of certain litigation involving industry wide
packaging claims. Special items for the second quarter of 2014 included
after-tax expenses of $7.6 million primarily associated with
restructuring and impairment charges as well as certain transaction
related expenses.
First Six Months Financial Summary
-- Net revenue for the first six months of 2015 was $833.8 million, an
increase of 7.9% compared to the first six months of 2014 net revenue of
$772.6 million.
-- Net income excluding special items for the first six months of 2015 was
$31.1 million, or $0.44 per diluted share, as compared to net income
excluding special items of $27.7 million for the first six months of
2014, or $0.39 per diluted share.
-- Including special items, net income for the first six months of 2015 was
$28.0 million, or $0.39 per diluted share, as compared to net income
including special items of $18.6 million for the first six months of
2014, or $0.26 per diluted share.
-- Special items for the first six months of 2015 included after-tax
expenses of $3.1 million primarily associated with legal fees and an
accrual for the likely settlement of certain litigation involving
industry wide packaging claims. Special items for the first six months
of 2014 included after-tax expenses of $9.1 million primarily associated
with restructuring and impairment charges as well as certain transaction
related expenses.
Dividend Declared
The Company also announced the declaration of a quarterly cash dividend of $0.16 per share on the Company's common stock. The dividend is payable on August 31, 2015 to stockholders of record at the close of business on August 25, 2015.
Estimates for 2015
Management has not changed estimates for 2015, with net revenue for the full year expected to be in the range of $1.69 to $1.72 billion. The earnings per diluted share estimates range remains at $1.11 to $1.19, with capital expenditures for 2015 projected to be between $60 and $62 million.
Conference Call
Management will conduct a conference call and live webcast at 4:30pm eastern time on Monday, August 10, to review the Company's second quarter 2015 results. The conference call and accompanying slide presentation will be webcast live through the Investor Relations section of the Company's website, www.snyderslance.com. In addition, the slide presentation will be available at www.snyderslance.com to download and print approximately 30 minutes before the webcast. To participate in the conference call, the dial-in number is (844) 830-1960 for U.S. callers or (315) 625-6883 for international callers. The conference ID is 84849288. A continuous telephone replay of the call will be available between 7:30pm on August 10 and midnight on August 17. The replay telephone number is (855) 859-2056 for U.S. callers or (404) 537-3406 for international callers. The replay access code is 84849288. Investors may also access a web-based replay of the conference call at www.snyderslance.com.
About Snyder's-Lance, Inc.
Snyder's-Lance, Inc., headquartered in Charlotte, NC, manufactures and markets snack foods throughout the United States and internationally. Snyder's-Lance's products include pretzels, sandwich crackers, pretzel crackers, potato chips, cookies, tortilla chips, restaurant style crackers, nuts and other snacks. Snyder's-Lance has manufacturing facilities in North Carolina, Pennsylvania, Indiana, Georgia, Arizona, Massachusetts, Florida, Ohio and Wisconsin. Products are sold under the Snyder's of Hanover®, Lance®, Cape Cod®, Snack Factory® Pretzel Crisps®, Late July®, Krunchers!®, Tom's®, Archway®, Jays®, Stella D'oro®, Eatsmart(TM), O-Ke-Doke®, and other brand names along with a number of third party brands. Products are distributed nationally through grocery and mass merchandisers, convenience stores, club stores, food service outlets and other channels. LNCE-E
Cautionary Information about Forward Looking Statements
This press release contains statements which may be forward looking within the meaning of applicable securities laws. The statements include projections regarding future revenues, earnings and other results which are based upon the Company's current expectations and assumptions, which are subject to a number of risks and uncertainties. Factors that could cause actual results to differ include general economic conditions or an economic turndown; volatility in the price or availability of inputs, including raw materials, packaging, energy and labor; price competition and industry consolidation; changes in our top retail customer relationships; inability to maintain profitability in the face of a consolidating retail environment; failure to successfully integrate acquisitions or execute divestitures; loss of key personnel; failure to execute and accomplish our strategy; concerns with the safety and quality of certain food products or ingredients; adulterated, misbranded or mislabeled products or product recalls; disruption of our supply chain; inadequacies in, or security breaches of, our information technology systems; improper use of social media; changes in consumer preferences and tastes or inability to innovate or market our products effectively; reliance on distribution through a significant number of independent business owners; protection of our trademarks and other intellectual property rights; impairment in the carrying value of goodwill or other intangible assets; new regulations or legislation; interest rate volatility, and the interests of a few individuals who control a significant portion of our outstanding shares of common stock may conflict with those of other stockholders, which have been discussed in greater detail in our most recent Form 10-K and other reports filed with the Securities and Exchange Commission.
SNYDER'S-LANCE, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Income (Unaudited)
For the Quarters and Six Months Ended July 4, 2015 and June 28, 2014
Quarter Ended Six Months Ended
------------- ----------------
(in thousands, except per share data) July 4, June 28, July 4, June 28,
2015 2014 2015 2014
--- ---- ---- ---- ----
Net revenue $431,428 $399,596 $833,769 $772,612
Cost of sales 279,945 254,707 542,924 494,537
------- ------- ------- -------
Gross margin 151,483 144,889 290,845 278,075
Selling, general and administrative 121,844 121,312 243,768 237,376
Impairment charges - 6,503 - 7,503
Gain on sale of route businesses, net (74) (297) (867) (1,460)
Other (income)/expense, net (110) 501 (846) 581
---- --- ---- ---
Income before interest and income taxes 29,823 16,870 48,790 34,075
Interest expense, net 2,671 4,111 5,138 7,501
----- ----- ----- -----
Income before income taxes 27,152 12,759 43,652 26,574
Income tax expense 9,758 4,584 15,676 7,910
----- ----- ------ -----
Income from continuing operations 17,394 8,175 27,976 18,664
Income from discontinued operations, net of income tax - 3,523 - 9,845
Net income 17,394 11,698 27,976 28,509
Net income attributable to noncontrolling interests 65 21 11 16
Net income attributable to Snyder's-Lance, Inc. $17,329 $11,677 $27,965 $28,493
======= ======= ======= =======
Amounts attributable to Snyder's-Lance, Inc.:
Continuing operations $17,329 $8,154 $27,965 $18,648
Discontinued operations - 3,523 - 9,845
Net income $17,329 $11,677 $27,965 $28,493
======= ======= ======= =======
Basic earnings per share:
Continuing operations $0.25 $0.12 $0.40 $0.27
Discontinued operations - 0.05 - 0.14
--- ---- --- ----
Total basic earnings per share $0.25 $0.17 $0.40 $0.41
===== ===== ===== =====
Diluted earnings per share:
Continuing operations $0.24 $0.11 $0.39 $0.26
Discontinued operations - 0.05 - 0.14
--- ---- --- ----
Total diluted earnings per share $0.24 $0.16 $0.39 $0.40
===== ===== ===== =====
Cash dividends declared per share $0.16 $0.16 $0.32 $0.32
SNYDER'S-LANCE, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets (Unaudited)
As of July 4, 2015 and January 3, 2015
(in thousands, except
share data) July 4, January 3,
2015 2015
--- ---- ----
ASSETS
------
Current assets:
Cash and cash
equivalents $42,619 $35,373
Restricted cash 966 966
Accounts receivable,
net of allowances of
$1,143 and $1,778,
respectively 145,806 126,093
Inventories 126,886 116,236
Prepaid income taxes 4,738 4,175
Deferred income taxes 13,188 13,189
Assets held for sale 12,697 11,007
Prepaid expenses and
other current assets 21,590 22,112
------ ------
Total current assets 368,490 329,151
Noncurrent assets:
Fixed assets, net 415,997 423,612
Goodwill 540,410 541,539
Other intangible
assets, net 537,224 545,212
Other noncurrent
assets 23,838 23,874
Total assets $1,885,959 $1,863,388
========== ==========
LIABILITIES AND
STOCKHOLDERS' EQUITY
--------------------
Current liabilities:
Current portion of
long-term debt $8,541 $8,561
Accounts payable 73,247 57,407
Accrued compensation 24,038 32,774
Accrued casualty
insurance claims 4,199 4,320
Accrued selling and
promotional costs 16,823 13,141
Other payables and
accrued liabilities 27,407 24,723
------ ------
Total current
liabilities 154,255 140,926
Noncurrent
liabilities:
Long-term debt 434,126 438,376
Deferred income taxes 170,414 168,593
Accrued casualty
insurance claims 13,481 13,755
Other noncurrent
liabilities 16,033 15,030
------ ------
Total liabilities 788,309 776,680
Commitments and
contingencies
Stockholders' equity:
Common stock, $0.83
1/3 par value.
110,000,000 shares
authorized;
70,672,034 and
70,406,086 shares
outstanding,
respectively 58,891 58,669
Preferred stock, $1.00
par value. Authorized
5,000,000 shares; no
shares outstanding - -
Additional paid-in
capital 782,677 776,930
Retained earnings 238,217 232,812
Accumulated other
comprehensive loss (1,450) (1,007)
------ ------
Total Snyder's-Lance,
Inc. stockholders'
equity 1,078,335 1,067,404
Noncontrolling
interests 19,315 19,304
------ ------
Total stockholders'
equity 1,097,650 1,086,708
Total liabilities and
stockholders' equity $1,885,959 $1,863,388
========== ==========
SNYDER'S-LANCE, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows (Unaudited)
For the Six Months Ended July 4, 2015 and June 28, 2014
Six Months Ended
----------------
(in thousands) July 4, June 28,
2015 2014
--- ---- ----
Operating activities:
Net income $27,976 $28,509
Adjustments to reconcile net
income to cash from operating
activities:
Depreciation and amortization 35,070 29,742
Stock-based compensation expense 2,755 3,128
Loss on sale of fixed assets, net 79 398
Gain on sale of route businesses,
net (867) (1,460)
Gain on sale of investments, net (183) -
Impairment charges - 7,503
Deferred income taxes 1,818 544
Provision for doubtful accounts 751 811
Change in inventory reserves 591 (869)
Changes in operating assets and
liabilities, excluding business
acquisition (18,735) (15,125)
Net cash provided by operating
activities 49,255 53,181
------ ------
Investing activities:
Purchases of fixed assets (22,947) (33,891)
Purchases of route businesses (10,094) (15,018)
Proceeds from sale of fixed
assets and insurance recoveries 795 471
Proceeds from sale of route
businesses 12,896 16,258
Proceeds from sale of investments 436 -
Business acquisition, net of cash
acquired - (202,260)
--- --------
Net cash used in investing
activities (18,914) (234,440)
------- --------
Financing activities:
Dividends paid to stockholders (22,560) (22,426)
Debt issuance costs - (1,854)
Issuances of common stock 4,016 4,819
Repurchases of common stock (801) (1,160)
Repayments of long-term debt (3,750) (8,750)
Net proceeds from existing credit
facilities - 215,000
Net cash (used in)/provided by
financing activities (23,095) 185,629
------- -------
Increase in cash and cash
equivalents 7,246 4,370
Cash and cash equivalents at
beginning of period 35,373 14,080
Cash and cash equivalents at end
of period $42,619 $18,450
======= =======
Supplemental information:
Cash paid for income taxes, net
of refunds of $651 and $164,
respectively $13,523 $13,925
Cash paid for interest $5,487 $7,159
SNYDER'S-LANCE, INC. AND SUBSIDIARIES
Reconciliation of Non-GAAP Measures (Unaudited)
For the Quarters and Six Months Ended July 4, 2015 and June 28, 2014
(in thousands,
except per
share data) Net of Per Diluted
Tax Share
--- --- -----
Quarter Ended
July 4, 2015
-------------
Income from
continuing
operations $17,329 $0.243
Severance
charges (263) (0.004)
Legal fees and
accrual for
potential
settlement -
"All Natural"
litigation 1,969 0.028
Professional
fees 71 0.001
---
Income from
continuing
operations,
excluding
special items $19,106 $0.268
======= ======
Quarter Ended
June 28, 2014
--------------
Income from
continuing
operations $8,154 $0.115
Impairment
charges 4,188 0.059
Restructuring
charges 1,968 0.028
Professional
fees 1,477 0.021
-----
Income from
continuing
operations,
excluding
special items $15,787 $0.223
======= ======
(in thousands,
except per
share data) Net of Per Diluted
Tax Share
--- --- -----
Six Months
Ended July 4,
2015
--------------
Income from
continuing
operations $27,965 $0.392
Severance
charges 248 0.004
Legal fees and
accrual for
potential
settlement -
"All Natural"
litigation 2,551 0.036
Professional
fees 299 0.004
---
Income from
continuing
operations,
excluding
special items $31,063 $0.436
======= ======
Six Months
Ended June 28,
2014
---------------
Income from
continuing
operations $18,648 $0.263
Impairment
charges 4,819 0.068
Restructuring
charges 1,968 0.028
Professional
fees 1,691 0.024
Self-funded
medical
insurance
claim 564 0.008
---
Income from
continuing
operations,
excluding
special items $27,690 $0.391
======= ======
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SOURCE Snyder's-Lance, Inc.
