ý | CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 20-8720036 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
399 Jefferson Road Parsippany, New Jersey | 07054 | |
(Address of Principal Executive Offices) | (Zip Code) |
Item 2.02 | Results of Operations and Financial Condition. |
Item 9.01 | Financial Statements and Exhibits. |
Exhibit Number | Description | |
99.1 | Release dated March 6, 2012 announcing financial results for the fiscal year ended December 30, 2012. |
By: | /s/ CRAIG STEENECK | |
Name: | Craig Steeneck | |
Title: | Executive Vice President and Chief Financial Officer | |
Date: | March 6, 2013 |
Exhibit Number | Description | |
99.1 | Release dated March 6, 2012 announcing financial results for the fiscal year ended December 30, 2012. |
(thousands of dollars) | Three Months Ended | Fiscal year | |||||||||||||
December 30, 2012 | December 25, 2011 | December 30, 2012 | December 25, 2011 | ||||||||||||
14 weeks | 13 weeks | 53 weeks | 52 weeks | ||||||||||||
Net earnings (loss) | $ | 43,662 | $ | (87,524 | ) | $ | 52,519 | $ | (46,914 | ) | |||||
Interest expense, net | 43,878 | 52,693 | 198,374 | 208,078 | |||||||||||
Income tax expense (benefit) | 29,000 | 9,096 | 32,701 | 22,103 | |||||||||||
Depreciation and amortization expense | 29,581 | 23,411 | 98,123 | 88,476 | |||||||||||
EBITDA | $ | 146,121 | $ | (2,324 | ) | $ | 381,717 | $ | 271,743 | ||||||
Non-cash items (a) | 1,431 | 145,954 | 63 | 152,245 | |||||||||||
Acquisition, merger and other restructuring charges (as defined) (b) | 5,403 | 3,134 | 23,276 | 20,264 | |||||||||||
Other adjustment items (c) | 21 | 2,294 | 21,040 | 5,440 | |||||||||||
Adjusted EBITDA (unaudited) | 152,976 | 149,058 | 426,096 | 449,692 |
(a) | Non-cash items are comprised of the following: |
(thousands of dollars) | Three Months Ended | Fiscal year | |||||||||||||
December 30, 2012 | December 25, 2011 | December 30, 2012 | December 25, 2011 | ||||||||||||
14 weeks | 13 weeks | 53 weeks | 52 weeks | ||||||||||||
Non-cash equity-related compensation charges | $ | 125 | $ | 251 | $ | 850 | $ | 1,151 | |||||||
Unrealized mark-to-market losses resulting from hedging activities | 786 | (2,497 | ) | (1,307 | ) | 1,608 | |||||||||
Goodwill impairment charge (1) | — | 122,900 | — | 122,900 | |||||||||||
Other impairment charge (2) | 520 | 25,300 | 520 | 26,586 | |||||||||||
Total non-cash items | $ | 1,431 | $ | 145,954 | $ | 63 | $ | 152,245 |
(1) | For fiscal 2011, represents goodwill impairments on the Breakfast ($51,700), Private Label ($49,700) and Food Service ($21,500) reporting Units. |
(2) | For fiscal 2012, represents tradename impairments on Bernstein's ($0.5 million). For fiscal 2011, represents tradename impairments on Aunt Jemima ($23,700), Lenders ($1,200) and Bernstein's ($400). For fiscal 2011, this also includes a plant asset impairment on the previously announced closure of the Tacoma, WA facility ($1,286). |
(b) | Acquisition, merger and other restructuring charges are comprised of the following: |
(thousands of dollars) | Three Months Ended | Fiscal year | |||||||||||||
December 30, 2012 | December 25, 2011 | December 30, 2012 | December 25, 2011 | ||||||||||||
14 weeks | 13 weeks | 53 weeks | 52 weeks | ||||||||||||
Expenses in connection with an acquisition or other non-recurring merger costs | $ | 729 | $ | (268 | ) | $ | 2,349 | $ | 8,771 | ||||||
Restructuring charges, integration costs and other business optimization expenses (1) | 4,622 | 2,366 | 19,911 | 9,485 | |||||||||||
Employee severance | 52 | 1,036 | 1,016 | 2,008 | |||||||||||
Total non-recurring items | $ | 5,403 | $ | 3,134 | $ | 23,276 | $ | 20,264 |
(1) | For fiscal 2012, primarily represents restructuring charges, consulting and business optimization expenses related to the closings of the Tacoma, Washington, Fulton, New York, Green Bay, Wisconsin and Millsboro, Delaware facilities. For fiscal 2011, primarily represents restructuring charges, consulting and business optimization expenses related to the closings of the Tacoma, Washington and Fulton, New York facilities. |
(c) | Other adjustment items are comprised of the following: |
(thousands of dollars) | Three Months Ended | Fiscal year | |||||||||||||
December 30, 2012 | December 25, 2011 | December 30, 2012 | December 25, 2011 | ||||||||||||
14 weeks | 13 weeks | 53 weeks | 52 weeks | ||||||||||||
Management, monitoring, consulting and advisory fees paid to Blackstone | $ | 1,173 | $ | 1,150 | $ | 4,707 | $ | 4,572 | |||||||
Other (1) | (1,152 | ) | 1,144 | 16,333 | 868 | ||||||||||
Total other adjustments | $ | 21 | $ | 2,294 | $ | 21,040 | $ | 5,440 |
(thousands of dollars) | Three Months Ended | Fiscal year ended | |||||||||||||
December 30, 2012 | December 25, 2011 | December 30, 2012 | December 25, 2011 | ||||||||||||
14 weeks | 13 weeks | 53 weeks | 52 weeks | ||||||||||||
EBIT | $ | 116,540 | $ | (25,736 | ) | $ | 283,594 | $ | 183,266 | ||||||
Non-cash items (a) | 1,431 | 145,954 | 63 | 152,245 | |||||||||||
Acquisitions, merger or other restructuring charges (b) | 5,403 | 3,134 | 23,276 | 20,264 | |||||||||||
Accelerated depreciation (1) | 9,637 | 3,330 | 21,867 | 14,077 | |||||||||||
Other adjustment items (c) | 21 | 2,294 | 21,040 | 5,440 | |||||||||||
EBIT, excluding charges | $ | 133,032 | $ | 128,976 | $ | 349,840 | $ | 375,292 | |||||||
1. | Related to footprint consolidation projects. |
(a) | Non-cash items are comprised of the following: |
(thousands of dollars) | Three Months Ended | Fiscal year ended | |||||||||||||
December 30, 2012 | December 25, 2011 | December 30, 2012 | December 25, 2011 | ||||||||||||
14 weeks | 13 weeks | 53 weeks | 52 weeks | ||||||||||||
Non-cash compensation charges | $ | 125 | $ | 251 | $ | 850 | $ | 1,151 | |||||||
Unrealized losses (gains) resulting from hedging activities | 786 | (2,497 | ) | (1,307 | ) | 1,608 | |||||||||
Goodwill impairment charges (1) | — | 122,900 | — | 122,900 | |||||||||||
Other impairment charges (2) | 520 | 25,300 | 520 | 26,586 | |||||||||||
Total non-cash items | $ | 1,431 | $ | 145,954 | $ | 63 | $ | 152,245 | |||||||
(1) | For fiscal 2011, represents goodwill impairments on the Breakfast ($51,700), Private Label ($49,700) and Food Service ($21,500) reporting Units. |
(2) | For fiscal 2012, represents tradename impairments on Bernstein's ($520). For fiscal 2011, represents tradename impairments on Aunt Jemima ($23,700), Lenders ($1,200) and Bernstein's ($400). For fiscal 2011, this also includes a plant asset impairment on the previously announced closure of the Tacoma, WA facility ($1,286). |
(b) | Acquisition, merger and other restructuring charges are comprised of the following: |
(thousands of dollars) | Three Months Ended | Fiscal year ended | |||||||||||||
December 30, 2012 | December 25, 2011 | December 30, 2012 | December 25, 2011 | ||||||||||||
14 weeks | 13 weeks | 53 weeks | 52 weeks | ||||||||||||
Expenses in connection with an acquisition or other non-recurring merger costs | $ | 729 | $ | (268 | ) | $ | 2,349 | $ | 8,771 | ||||||
Restructuring charges, integration costs and other business optimization expenses (1) | 4,622 | 2,366 | 19,911 | 9,485 | |||||||||||
Employee severance and recruiting | 52 | 1,036 | 1,016 | 2,008 | |||||||||||
Total acquisition, merger and other restructuring charges | $ | 5,403 | $ | 3,134 | $ | 23,276 | $ | 20,264 | |||||||
(1) | For fiscal 2012, primarily represents restructuring charges, consulting and business optimization expenses related to the closings of the Tacoma, Washington, Fulton, New York, Green Bay, Wisconsin and Millsboro, Delaware facilities. For fiscal 2011, primarily represents restructuring charges, consulting and business optimization expenses related to the closings of the Tacoma, Washington and Fulton, New York facilities. |
(c) | Other adjustment items are comprised of the following: |
(thousands of dollars) | Three Months Ended | Fiscal year ended | |||||||||||||
December 30, 2012 | December 25, 2011 | December 30, 2012 | December 25, 2011 | ||||||||||||
14 weeks | 13 weeks | 53 weeks | 52 weeks | ||||||||||||
Management, monitoring, consulting, and advisory fees | $ | 1,173 | $ | 1,150 | $ | 4,707 | $ | 4,572 | |||||||
Other (1) | (1,152 | ) | 1,144 | 16,333 | 868 | ||||||||||
Total other adjustments | $ | 21 | $ | 2,294 | $ | 21,040 | $ | 5,440 | |||||||
(1) | For fiscal 2012, primarily represents $14.3 million of the premiums paid on the redemption of $150.0 million of 9.25% Senior Notes due 2015, the redemption of $199.0 million of 10.625% Senior Subordinated Notes due 2017 and the repurchase and retirement of $10.0 million of 9.25% Senior Notes due 2015. Also, for fiscal 2012 and fiscal 2011, represents costs for the recall of Aunt Jemima product net of insurance recoveries of $2.1 million in 2012 and $1.1 million in 2011. For fiscal 2011, also includes a gain on the sale of the Watsonville, CA property of $0.4 million. |
Three months ended | Fiscal year | |||||||||||||||
December 30, 2012 | December 25, 2011 | December 30, 2012 | December 25, 2011 | |||||||||||||
14 weeks | 13 weeks | 53 weeks | 52 weeks | |||||||||||||
Net sales | $ | 705,060 | $ | 686,482 | $ | 2,478,485 | $ | 2,469,562 | ||||||||
Cost of products sold | 517,685 | 500,938 | 1,893,936 | 1,854,696 | ||||||||||||
Gross profit | 187,375 | 185,544 | 584,549 | 614,866 | ||||||||||||
Operating expenses | ||||||||||||||||
Marketing and selling expenses | 39,196 | 39,877 | 169,736 | 171,641 | ||||||||||||
Administrative expenses | 23,325 | 17,820 | 89,414 | 80,460 | ||||||||||||
Research and development expenses | 3,820 | 1,678 | 12,031 | 8,021 | ||||||||||||
Goodwill impairment charge | — | 122,900 | — | 122,900 | ||||||||||||
Other expense (income), net | 4,494 | 29,005 | 29,774 | 48,578 | ||||||||||||
Total operating expenses | 70,835 | 211,280 | 300,955 | 431,600 | ||||||||||||
Earnings before interest and taxes | 116,540 | (25,736 | ) | 283,594 | 183,266 | |||||||||||
Interest expense | 43,883 | 52,695 | 198,484 | 208,319 | ||||||||||||
Interest income | 5 | 3 | 110 | 242 | ||||||||||||
Earnings (loss) before income taxes | 72,662 | (78,428 | ) | 85,220 | (24,811 | ) | ||||||||||
Provision for income taxes | 29,000 | 9,096 | 32,701 | 22,103 | ||||||||||||
Net earnings (loss) | $ | 43,662 | $ | (87,524 | ) | $ | 52,519 | $ | (46,914 | ) |
December 30, 2012 | December 25, 2011 | ||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 92,281 | $ | 151,031 | |||
Accounts receivable, net of allowances of $5,149 and $5,440, respectively | 143,884 | 159,981 | |||||
Inventories | 358,051 | 335,812 | |||||
Other current assets | 11,862 | 7,549 | |||||
Deferred tax assets | 99,199 | 71,109 | |||||
Total current assets | 705,277 | 725,482 | |||||
Plant assets, net of accumulated depreciation of $244,694 and $205,281, respectively | 493,666 | 501,283 | |||||
Tradenames | 1,603,992 | 1,604,512 | |||||
Other assets, net | 155,558 | 178,849 | |||||
Goodwill | 1,441,495 | 1,441,495 | |||||
Total assets | $ | 4,399,988 | $ | 4,451,621 | |||
Current liabilities: | |||||||
Short-term borrowings | $ | 2,139 | $ | 1,708 | |||
Current portion of long-term obligations | 30,419 | 15,661 | |||||
Accounts payable | 137,326 | 152,869 | |||||
Accrued trade marketing expense | 44,571 | 35,125 | |||||
Accrued liabilities | 119,269 | 128,785 | |||||
Total current liabilities | 333,724 | 334,148 | |||||
Long-term debt (includes $63,097 and $121,992 owed to related parties, respectively) | 2,576,386 | 2,738,650 | |||||
Pension and other postretirement benefits | 100,918 | 93,406 | |||||
Other long-term liabilities | 28,705 | 22,099 | |||||
Deferred tax liabilities | 471,529 | 417,966 | |||||
Total liabilities | 3,511,262 | 3,606,269 | |||||
Commitments and contingencies | |||||||
Member’s equity: | |||||||
Limited liability company interests | — | — | |||||
Additional paid-in-capital | 697,324 | 697,352 | |||||
Retained earnings | 252,955 | 200,436 | |||||
Accumulated other comprehensive loss | (61,553 | ) | (52,436 | ) | |||
Total member’s equity | 888,726 | 845,352 | |||||
Total liabilities and member’s equity | $ | 4,399,988 | $ | 4,451,621 | |||
Fiscal year | |||||||
December 30, 2012 | December 25, 2011 | ||||||
53 weeks | 52 weeks | ||||||
Cash flows from operating activities | |||||||
Net earnings (loss) | $ | 52,519 | $ | (46,914 | ) | ||
Non-cash charges (credits) to net earnings (loss) | |||||||
Depreciation and amortization | 98,123 | 88,476 | |||||
Goodwill and intangible asset impairment charge | 520 | 148,200 | |||||
Plant asset impairment charge | — | 1,286 | |||||
Amortization of discount on term loan | 994 | 1,205 | |||||
Amortization of debt acquisition costs | 8,585 | 11,062 | |||||
Call premium on note redemptions | 14,255 | — | |||||
Refinancing costs and write off of debt issuance costs | 17,482 | — | |||||
Amortization of deferred mark-to-market adjustment on terminated swaps | 444 | 2,119 | |||||
Change in value of financial instruments | (1,185 | ) | 1,617 | ||||
Equity-based compensation charge | 850 | 1,151 | |||||
Pension expense, net of contributions | (10,391 | ) | (13,543 | ) | |||
Other long-term liabilities | 2,799 | 113 | |||||
Other long-term assets | — | 169 | |||||
Deferred income taxes | 30,929 | 20,524 | |||||
Changes in working capital | |||||||
Accounts receivable | 16,259 | (10,952 | ) | ||||
Inventories | (22,027 | ) | (5,785 | ) | |||
Accrued trade marketing expense | 9,383 | (12,111 | ) | ||||
Accounts payable | (16,333 | ) | 38,201 | ||||
Accrued liabilities | (1,432 | ) | (23,490 | ) | |||
Other current assets | 1,079 | 2,884 | |||||
Net cash provided by operating activities | 202,853 | 204,212 | |||||
Cash flows from investing activities | |||||||
Capital expenditures | (78,279 | ) | (117,306 | ) | |||
Proceeds from sale of plant assets | 570 | 7,900 | |||||
Net cash used in investing activities | (77,709 | ) | (109,406 | ) | |||
Cash flows from financing activities | |||||||
Proceeds from bond offerings | — | — | |||||
Proceeds from bank term loans | 842,625 | — | |||||
Repayments of long-term obligations | (632,025 | ) | (57,547 | ) | |||
Repurchase of notes | (373,255 | ) | — | ||||
Proceeds from short-term borrowings | 4,294 | 3,070 | |||||
Repayments of short-term borrowings | (3,863 | ) | (2,954 | ) | |||
Borrowings under revolving credit facility | 40,000 | — | |||||
Repayments of revolving credit facility | (40,000 | ) | — | ||||
Repayment of capital lease obligations | (3,511 | ) | (2,543 | ) | |||
Equity contributions | — | 558 | |||||
Repurchases of equity | (878 | ) | (1,624 | ) | |||
Collection of notes receivable from officers | — | — | |||||
Debt acquisition costs | (17,498 | ) | (721 | ) | |||
Change in bank overdrafts | — | — | |||||
Other financing | — | 2,730 | |||||
Net cash used in financing activities | (184,111 | ) | (59,031 | ) | |||
Effect of exchange rate changes on cash | 217 | (30 | ) | ||||
Net change in cash and cash equivalents | (58,750 | ) | 35,745 | ||||
Cash and cash equivalents - beginning of period | 151,031 | 115,286 | |||||
Cash and cash equivalents - end of period | $ | 92,281 | $ | 151,031 | |||
Supplemental disclosures of cash flow information: | |||||||
Interest paid | $ | 179,427 | $ | 196,339 | |||
Interest received | 110 | 241 | |||||
Income taxes paid (refunded) | 1,981 | (1,954 | ) | ||||
Non-cash investing and financing activities: | |||||||
New capital leases | 1,548 | 11,240 |
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