-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, K0OTu8Zr2voe+xQJjV7wJ3Zw3GdGhPsF8i6w/jWQQr/IMEzKm73njuldVzpOSfub JotgWmY1G1ty6wWb0MU1PQ== 0000950132-98-000713.txt : 19980914 0000950132-98-000713.hdr.sgml : 19980914 ACCESSION NUMBER: 0000950132-98-000713 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 10 CONFORMED PERIOD OF REPORT: 19980729 FILED AS OF DATE: 19980911 SROS: NYSE SROS: PCX FILER: COMPANY DATA: COMPANY CONFORMED NAME: HEINZ H J CO CENTRAL INDEX KEY: 0000046640 STANDARD INDUSTRIAL CLASSIFICATION: CANNED, FROZEN & PRESERVED FRUIT, VEG & FOOD SPECIALTIES [2030] IRS NUMBER: 250542520 STATE OF INCORPORATION: PA FISCAL YEAR END: 0430 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-03385 FILM NUMBER: 98708142 BUSINESS ADDRESS: STREET 1: 600 GRANT ST CITY: PITTSBURGH STATE: PA ZIP: 15219 BUSINESS PHONE: 4124565700 MAIL ADDRESS: STREET 2: P O BOX 57 CITY: PITTSBURGH STATE: PA ZIP: 15230 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 FORM 10-Q [X]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JULY 29, 1998 OR [_]TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO FOR THE THREE MONTHS ENDED JULY 29, 1998 COMMISSION FILE NUMBER 1-3385 H. J. HEINZ COMPANY (Exact name of registrant as specified in its charter) PENNSYLVANIA 25-0542520 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 600 GRANT STREET, PITTSBURGH, 15219 PENNSYLVANIA (Zip Code) (Address of Principal Executive Offices) REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: 412-456-5700 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such requirements for the past 90 days. Yes X No The number of shares of the Registrant's Common Stock, par value $.25 per share, outstanding as of August 31, 1998 was 367,313,777 shares. PART I--FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS. H. J. HEINZ COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME
Three Months Three Months Ended Ended July 29, 1998 July 30, 1997 ------------- ------------- FY 1999 FY 1998 (Unaudited) (In Thousands, Except per Share Amounts) Sales............................................... $2,228,230 $2,233,270 Cost of products sold............................... 1,359,777 1,408,203 ---------- ---------- Gross profit........................................ 868,453 825,067 Selling, general and administrative expenses........ 460,354 357,850 ---------- ---------- Operating income.................................... 408,099 467,217 Interest income..................................... 7,585 7,906 Interest expense.................................... 64,043 63,311 Other expense, net.................................. 17,619 6,498 ---------- ---------- Income before income taxes.......................... 334,022 405,314 Provision for income taxes.......................... 120,235 162,013 ---------- ---------- Net income.......................................... $ 213,787 $ 243,301 ========== ========== Net income per share--diluted....................... $ 0.58 $ 0.65 ========== ========== Average common shares outstanding--diluted.......... 369,398 374,644 ========== ========== Net income per share--basic......................... $ 0.59 $ 0.66 ========== ========== Average common shares outstanding--basic............ 362,400 367,420 ========== ========== Cash dividends per share............................ $ 0.315 $ 0.29 ========== ==========
See Notes to Condensed Consolidated Financial Statements. ------------ 2 H. J. HEINZ COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS
July 29, 1998 April 29, 1998 ------------- -------------- FY 1999 FY 1998 (Unaudited) (Thousands of Dollars) Assets Current Assets: Cash and cash equivalents......................... $ 137,378 $ 96,300 Short-term investments, at cost which approximates market............................................ 6,556 3,098 Receivables, net.................................. 1,012,534 1,071,837 Inventories....................................... 1,338,621 1,328,843 Prepaid expenses and other current assets......... 223,017 186,441 ---------- ---------- Total current assets............................ 2,718,106 2,686,519 ---------- ---------- Property, plant and equipment..................... 4,066,445 4,068,123 Less accumulated depreciation..................... 1,704,085 1,673,461 ---------- ---------- Total property, plant and equipment, net........ 2,362,360 2,394,662 ---------- ---------- Goodwill, net..................................... 1,778,458 1,764,574 Trademarks, net................................... 538,816 416,918 Other intangibles, net............................ 192,580 194,560 Other non-current assets.......................... 552,475 566,188 ---------- ---------- Total other non-current assets.................. 3,062,329 2,942,240 ---------- ---------- Total assets.................................... $8,142,795 $8,023,421 ========== ==========
*Summarized from audited fiscal year 1998 balance sheet. See Notes to Condensed Consolidated Financial Statements. ------------ 3 H. J. HEINZ COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS
July 29, 1998 April 29, 1998 ------------- -------------- FY 1999 FY 1998 (Unaudited) (Thousands of Dollars) Liabilities and Shareholders' Equity Current Liabilities: Short-term debt................................... $ 283,955 $ 301,028 Portion of long-term debt due within one year..... 19,965 38,598 Accounts payable.................................. 810,729 978,365 Salaries and wages................................ 70,713 66,473 Accrued marketing................................. 194,170 163,405 Accrued restructuring costs....................... 75,485 94,400 Other accrued liabilities......................... 250,981 360,608 Income taxes...................................... 232,965 161,396 ---------- ---------- Total current liabilities....................... 1,938,963 2,164,273 ---------- ---------- Long-term debt.................................... 3,187,421 2,768,277 Deferred income taxes............................. 292,585 291,161 Non-pension postretirement benefits............... 207,019 209,642 Other liabilities................................. 360,097 373,552 ---------- ---------- Total long-term debt and other liabilities...... 4,047,122 3,642,632 ---------- ---------- Shareholders' Equity: Capital stock..................................... 107,958 107,973 Additional capital................................ 260,422 252,773 Retained earnings................................. 4,490,038 4,390,248 ---------- ---------- 4,858,418 4,750,994 Less: Treasury stock at cost (69,080,360 shares at July 29, 1998 and 67,678,632 shares at April 29, 1998)............. 2,211,747 2,103,979 Unearned compensation relating to the ESOP....... 14,078 14,822 Accumulated other comprehensive income........... 475,883 415,677 ---------- ---------- Total shareholders' equity...................... 2,156,710 2,216,516 ---------- ---------- Total liabilities and shareholders' equity...... $8,142,795 $8,023,421 ========== ==========
*Summarized from audited fiscal year 1998 balance sheet. See Notes to Condensed Consolidated Financial Statements. ------------ 4 H. J. HEINZ COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Three Months Three Months Ended Ended July 29, 1998 July 30, 1997 ------------- ------------- FY 1999 FY 1998 (Unaudited) (Thousands of Dollars) Cash Provided by Operating Activities.............. $ 75,280 $ 188,376 -------- --------- Cash Flows from Investing Activities: Capital expenditures............................. (65,438) (88,133) Acquisitions, net of cash acquired............... (160,297) (93,825) Proceeds from sale of Ore-Ida frozen foodservice foods business.................................. -- 490,739 Purchases of short-term investments.............. (175,073) (230,955) Sales and maturities of short-term investments... 175,096 222,386 Other items, net................................. 3,251 (1,766) -------- --------- Cash (used for) provided by investing activities.................................... (222,461) 298,446 -------- --------- Cash Flows from Financing Activities: Payments on long-term debt....................... (40,975) (3,194) Proceeds from (payments on) commercial paper and short-term borrowings, net...................... 184,190 (302,802) Proceeds from long-term debt..................... 254,808 -- Dividends........................................ (113,997) (106,921) Purchases of treasury stock...................... (134,011) (168,245) Exercise of stock options........................ 27,178 81,940 Other items, net................................. 16,568 13,803 -------- --------- Cash provided by (used for) financing activities.................................... 193,761 (485,419) -------- --------- Effect of exchange rate changes on cash and cash equivalents....................................... (5,502) 9,702 -------- --------- Net increase in cash and cash equivalents.......... 41,078 11,105 Cash and cash equivalents at beginning of year..... 96,300 156,986 -------- --------- Cash and cash equivalents at end of period......... $137,378 $ 168,091 ======== =========
See Notes to Condensed Consolidated Financial Statements. ------------ 5 H. J. HEINZ COMPANY AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) (1) The Management's Discussion and Analysis of Financial Condition and Results of Operations which follows these notes contains additional information on the results of operations and the financial position of the company. Those comments should be read in conjunction with these notes. The company's annual report on Form 10-K for the fiscal year ended April 29, 1998 includes additional information about the company, its operations, and its financial position, and should be read in conjunction with this quarterly report on Form 10-Q. (2) The results for the interim periods are not necessarily indicative of the results to be expected for the full fiscal year due to the seasonal nature of the company's business. Certain prior year amounts have been reclassified in order to conform with the fiscal 1999 presentation. (3) In the opinion of management, all adjustments, which are of a normal and recurring nature, necessary for a fair statement of the results of operations of these interim periods have been included. (4) The composition of inventories at the balance sheet dates was as follows:
July 29, 1998 April 29, 1998 ------------- -------------- (Thousands of Dollars) Finished goods and work-in-process............. $ 980,843 $ 988,322 Packaging material and ingredients............. 357,778 340,521 ---------- ---------- $1,338,621 $1,328,843 ========== ==========
(5) The provision for income taxes consists of provisions for federal, state, U.S. possessions and foreign income taxes. The company operates in an international environment with significant operations in various locations outside the United States. Accordingly, the consolidated income tax rate is a composite rate reflecting the earnings in the various locations and the applicable tax rates. (6) On June 1, 1998, the company acquired the Vidalia O's frozen onion rings brand from Vidalia Frozen Foods, Inc. to complement the company's Ore-Ida frozen vegetable lines. On June 26, 1998, the company acquired the Eta brand of dressings (mayonnaise, salad dressings) and peanut butter from Griffins Foods Limited of Auckland, New Zealand. On July 6, 1998, the company acquired the College Inn brand of canned broth from Nabisco Inc. College Inn broths, which include chicken, beef and garden vegetable varieties, have strong brand equity throughout the Eastern and Midwestern United States. All of the above acquisitions have been accounted for as purchases and, accordingly, the respective purchase prices have been allocated on a preliminary basis to the respective assets and liabilities based on their estimated fair values as of the dates of the acquisitions. Operating results of these acquisitions have been included in the Consolidated Statement of Income from the dates of the acquisitions. Pro forma results of the company, assuming all of the above transactions had been made at the beginning of each period presented, would not be materially different from the results reported. 6 (7) The company's $2.30 billion credit agreement, which expires in September 2001, supports its domestic commercial paper program. At July 29, 1998, the company had $1.53 billion of domestic commercial paper outstanding, all of which has been classified as long-term debt due to the long-term nature of the credit agreement. As of April 29, 1998, the company had $1.34 billion of domestic commercial paper outstanding and classified as long-term debt. On July 15, 1998, the company, under its current shelf registration statement, issued $250 million of 6.375% debentures due 2028. The proceeds were used to repay domestic commercial paper. (8) On September 8, 1998, the company's board of directors raised the quarterly dividend on the company's common stock to $0.34 1/4 per share from $0.31 1/2 per share, for an indicated annual rate of $1.37 per share. The dividend will be paid on October 10, 1998 to shareholders of record at the close of business on September 21, 1998. (9) In the third quarter of fiscal 1998, the company adopted Statement of Financial Accounting Standard ("SFAS") No. 128, "Earnings per Share" which requires the disclosure of both diluted and basic earnings per share. The following table sets forth the computation of basic and diluted earnings per share in accordance with the provisions of SFAS No. 128. Previously reported earnings per share amounts have been restated, as necessary, to conform to SFAS No. 128 requirements.
Three Months Three Months Ended Ended July 29, 1998 July 30, 1997 ------------- ------------- FY 1999 FY 1998 (In Thousands, Except per Share Amounts) Net income per share--basic: Net income.................................... $213,787 $243,301 Preferred dividends........................... 8 10 -------- -------- Net income applicable to common stock......... $213,779 $243,291 ======== ======== Average common shares outstanding--basic...... 362,400 367,420 ======== ======== Net income per share--basic................... $ 0.59 $ 0.66 ======== ======== Net income per share--diluted: Net income.................................... $213,787 $243,301 ======== ======== Average common shares outstanding............. 362,400 367,420 Effect of dilutive securities: Convertible preferred stock................. 253 319 Stock options............................... 6,745 6,905 -------- -------- Average common shares outstanding--diluted.... 369,398 374,644 ======== ======== Net income per share--diluted................. $ 0.58 $ 0.65 ======== ========
(10) As of April 30, 1998, the company adopted SFAS No. 130, "Reporting Comprehensive Income". The adoption of this statement had no impact on the company's net income or shareholders' equity. SFAS No. 130 establishes standards for reporting comprehensive income in financial statements. Comprehensive income includes all changes in equity during a period except those resulting from investments by or distributions to shareholders. For the company, comprehensive income for all periods presented consisted of net income, foreign currency translation adjustments and the adjustment to the minimum pension liability. Amounts in prior year financial statements have been reclassified to conform to SFAS No. 130 requirements. 7 The components of comprehensive income, net of related tax, for the periods presented are as follows:
Three Months Three Months Ended Ended July 29, 1998 July 30, 1997 ------------- ------------- FY 1999 FY 1998 Net income........................................ $213,787 $243,301 Other comprehensive income (loss): Foreign currency translation adjustment......... (61,309) (60,184) Minimum pension liability adjustment............ 1,103 21 -------- -------- Comprehensive Income.............................. $153,581 $183,138 ======== ========
8 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. THREE MONTHS ENDED JULY 29, 1998 AND JULY 30, 1997 RESULTS OF OPERATIONS For the three months ended July 29, 1998, sales decreased $5.0 million, or 0.2%, to $2,228.2 million from $2,233.3 million recorded in the same period a year ago. The sales decrease resulted from the unfavorable effect of foreign exchange translation rates of 4.3% and divestitures of 3.8%; partially offset by volume gains of 3.7%, acquisitions of 2.8% and favorable pricing of 1.4%. Domestic operations provided 52.8% of the consolidated net sales in the first quarter of 1999 compared to 54.1% in the first quarter of 1998. Volume increases were recorded in weight loss classroom activities, Heinz ketchup, weight loss frozen entrees, pet food, white meat tuna, single serve condiments, frozen entrees and sauces/pastes; partially offset by a volume decrease in light meat tuna. Price increases were recorded in sauces/pastes, light meat tuna and infant food; partially offset by a decrease in bakery products. Foreign currencies declined against the U.S. dollar, decreasing sales by $95.3 million, or 4.3%. This decrease came primarily from sales in the Asia/Pacific region and Africa. During the first quarter of Fiscal 1999 the company acquired the College Inn brand of canned broths, the Eta brand of dressings and peanut butter in New Zealand and the Vidalia O's frozen onion rings brand. Fiscal 1998 acquisitions impacting the quarter-to-quarter sales dollar comparison include John West Foods Limited in Europe and other acquisitions, primarily in South Africa and Europe. The sales impact of these acquisitions was more than offset by divestitures, primarily the sale of the Ore-Ida frozen foodservice business in the first quarter of last year. Gross profit increased $43.4 million to $868.5 million from $825.1 million, and the gross profit margin increased to $39.0% from 36.9%. Excluding non- recurring costs in both periods related to the implementation of Project Millennia, gross profit increased $52.7 million to $878.7 million from $826.0 million, and the gross profit margin increased to 39.4% from 37.0%. Cost savings resulting from Project Millennia, price increases and a favorable product mix increased the current quarter's gross profit and gross profit margin. The Weight Watchers classrooms business has responded well to the streamlining efforts resulting from Project Millennia and the strong consumer response to the Weight Watchers 1-2-3 Success(TM) Plan introduction in the U.S. Operating income decreased $59.1 million to $408.1 million from $467.2 million. The current period includes non-recurring costs related to the implementation of Project Millennia of $14.9 million pretax ($0.02 per share). Last year's first quarter included the gain on the sale of the Ore-Ida frozen foodservice business of $96.6 million pretax ($0.14 per share), and was recorded as an offset to selling, general and administrative expenses; partially offset by non-recurring costs related to the implementation of Project Millennia of $11.5 million ($0.02 per share). Excluding these non- recurring items related to Project Millennia in both periods, operating income increased $40.8 million, or 10.7%, to $423.0 million from $382.2 million and the operating margin increased to 19.0% from 17.1%. The increase in operating income, excluding the effects of these non-recurring items, is primarily due to the increase in gross profit, offset partially by an increase in selling, general and administrative expenses. Operating income in the current quarter was negatively impacted by foreign exchange translation rates, primarily in the Asia/Pacific region and Africa, which reduced operating income by $14.0 million or 3.7%. Net interest expense increased slightly to $56.5 million from $55.4 million. Other expenses increased $11.1 million to $17.6 million from $6.5 million in the prior period, primarily due to currency losses in the Asia/Pacific region. The effective tax rate for the first quarter of Fiscal 1999 was 36.0% compared to 40.0% last year. Last year's rate of 40.0% reflects a significantly higher tax rate associated with the sale of the Ore-Ida 9 frozen foodservice business. Excluding the foodservice sale, last year's first quarter rate was 38.4%. The lower effective rate in the current period is primarily due to the reduction in the tax rates in Italy and the United Kingdom in Fiscal 1998. Net income for the current quarter was $213.8 million compared to $243.3 million for the same quarter last year, and diluted earnings per share was $0.58 compared to $0.65. Excluding the impact of the non-recurring items in both periods related to Project Millennia, net income would have increased 13.2% to $223.3 million from $197.3 million, and diluted earnings per share would have increased 13.2% to $0.60 from $0.53. LIQUIDITY AND FINANCIAL POSITION Cash provided by operating activities totaled $75.3 million for the three month period ended July 29, 1998 compared to $188.4 million in last year's first quarter. Cash used for investing activities totaled $222.5 million compared to providing $298.4 million last year. Acquisitions in the current period required $160.3 million due to the purchase of the College Inn brand of canned broths, the Eta brand of dressings and peanut butter in New Zealand and the Vidalia O's frozen onion rings brand. Acquisitions in the prior year's first quarter required $93.8 million, due mainly to the purchase of John West Foods Limited in Europe and other smaller acquisitions in the Asia/Pacific region and South Africa. Capital expenditures required $65.4 million in the current quarter versus $88.1 million in last year's first quarter. Cash provided by divestitures in the prior year's first quarter totaled $490.7 million due to the sale of the Ore-Ida frozen foodservice business. In the current quarter, financing activities provided $193.8 million compared to utilizing $485.4 million in the same quarter last year. Proceeds from long-term debt provided $254.8 million and net proceeds from commercial paper and short-term borrowings provided $184.2 million compared to requiring $302.8 million in the same period last year. Share repurchases totaled $134.0 million (2.5 million shares) versus $168.2 million (3.7 million shares) in the prior year's first quarter. Dividend payments totaled $114.0 million compared to $106.9 million a year ago. Cash provided from stock options exercised totaled $27.2 million compared to $81.9 million last year. The company's $2.30 billion credit agreement, which expires in September 2001, supports its domestic commercial paper program. At July 29, 1998, the company had $1.53 billion of domestic paper outstanding, all of which has been classified as long-term debt due to the long-term nature of the credit agreement. As of April 29, 1998, the company had $1.34 billion of domestic commercial paper outstanding and classified as long-term debt. On July 15, 1998, the company, under its current shelf registration statement, issued $250 million of 6.375% debentures due 2028. The proceeds were used to repay domestic commercial paper. On September 8, 1998, the company's board of directors raised the quarterly dividend on the company's common stock to $0.34 1/4 per share from $0.31 1/2 per share, for an indicated annual rate of $1.37 per share. The dividend will be paid on October 10, 1998 to shareholders of record at the close of business on September 21, 1998. The company's financial position remains strong, enabling it to meet cash requirements for operations, capital expansion programs and dividends to shareholders. OTHER MATTERS On September 8, 1998, the company announced plans to sell its bakery products unit, based in Mississauga, Ontario, to The Pillsbury Company's Bakeries & Foodservice unit for approximately $178 million. Heinz Bakery Products is a $200 million business that makes frozen unbaked bagels and unbaked bread dough and supplies the in-store/retail, wholesale and foodservice channels in North America. This divestiture is part of the company's strategy to focus its efforts on its eight core categories and to improve the effectiveness of its portfolio by capitalizing on its strengths, investing in 10 growth opportunities and divesting businesses that do not meet its demanding objectives. The transaction is subject to regulatory approvals. The sale is not expected to have an adverse impact on the company's results of operations. For information concerning the Year 2000 issue, refer to page 33 of the company's Annual Report to Shareholders for the fiscal year ended April 29, 1998. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. There have been no material changes in the company's market risk during the first quarter ended July 29, 1998. For additional information, refer to pages 31 through 33 of the company's Annual Report to Shareholders for the fiscal year ended April 29, 1998. 11 PART II--OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS Nothing to report under this item. ITEM 2. CHANGES IN SECURITIES Nothing to report under this item. ITEM 3. DEFAULTS UPON SENIOR SECURITIES Nothing to report under this item. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS Nothing to report under this item. ITEM 5. OTHER INFORMATION See Note 6 to the Condensed Consolidated Financial Statements in Part I-- Item 1 of this Quarterly Report on Form 10-Q and "Other Matters" in Part I-- Item 2 of this Quarterly Report on Form 10-Q. This report contains certain forward-looking statements which are based on management's current views and assumptions regarding future events and financial performance. Reference should be made to the section "Forward- Looking Statements" in Item 1 of the registrant's Annual Report on Form 10-K for the fiscal year ended April 29, 1998 for a description of the important factors that could cause actual results to differ materially from those discussed herein. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits required to be furnished by Item 601 of Regulation S-K are listed below and are filed as part hereof. The Registrant has omitted certain exhibits in accordance with Item 601(b)(4)(iii)(A) of Regulation S- K. The Registrant agrees to furnish such documents to the Commission upon request. Documents not designated as being incorporated herein by reference are filed herewith. The paragraph numbers correspond to the exhibit numbers designated in Item 601 of Regulation S-K. 12.Computation of Ratio of Earnings to Fixed Charges. 27.Financial Data Schedule. (b) Reports on Form 8-K During the quarter ended July 29, 1998, the company filed a Current Report on Form 8-K dated July 10, 1998 and a Current Report on Form 8-K dated July 16, 1998 relating to its $250 million 6.375% debentures due 2028. 12 EX-12 2 COMPUTATION OF EARNINGS TO FIXED CHARGES EXHIBIT 12 H. J. HEINZ COMPANY AND SUBSIDIARIES COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES
Fiscal Years Ended ---------------------------------------------------- Three Months April Ended April 29, 30, May 1, May 3, April 27, July 29, 1998 1998 1997 1996 1995 1994 ------------- ---------- -------- ---------- ---------- ---------- Fixed Charges: Interest Expense*...... $ 64,512 $ 260,401 $277,818 $ 279,368 $ 212,123 $ 150,598 Capitalized Interest... 888 1,542 2,688 1,007 414 770 Interest Component of Rental Expense........ 7,119 30,828 27,382 26,728 24,200 26,638 -------- ---------- -------- ---------- ---------- ---------- Total Fixed Charges.... $ 72,519 $ 292,771 $307,888 $ 307,103 $ 236,737 $ 178,006 -------- ---------- -------- ---------- ---------- ---------- Earnings: Income Before Income Taxes................. $334,022 $1,254,981 $479,064 $1,023,661 $ 938,007 $ 922,386 Add: Interest Expense*. 64,512 260,401 277,818 279,368 212,123 150,598 Add: Interest Component of Rental Expense..... 7,119 30,828 27,382 26,728 24,200 26,638 Add: Amortization of Capitalized Interest.. 865 3,525 3,454 3,399 3,465 3,327 -------- ---------- -------- ---------- ---------- ---------- Earnings as Adjusted... $406,518 $1,549,735 $787,718 $1,333,156 $1,177,795 $1,102,949 -------- ---------- -------- ---------- ---------- ---------- Ratio of Earnings to Fixed Charges......... 5.61 5.29 2.56 4.34 4.98 6.20 ======== ========== ======== ========== ========== ==========
* Interest expense includes amortization of debt expense and any discount or premium relating to indebtedness. EX-27.1 3 FINANCIAL DATA SCHEDULE FOR PERIOD ENDED 7/29/98
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-Q FOR THE PERIOD ENDED JULY 29, 1998 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 U.S. DOLLARS 3-MOS APR-28-1999 APR-30-1998 JUL-29-1998 1 137,378 6,556 1,012,534 0 1,338,621 2,718,106 4,066,445 1,704,085 8,142,795 1,938,963 3,187,421 0 184 107,774 2,048,752 8,142,795 2,228,230 2,228,230 1,359,777 1,359,777 0 0 64,043 334,022 120,235 213,787 0 0 0 213,787 0.59 0.58 Represents basic earnings per share in accordance with SFAS No. 128.
EX-27.2 4 FINANCIAL DATA SCHEDULE FOR PERIOD ENDED 10/29/97
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-Q FOR THE PERIOD ENDED OCTOBER 29, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 U.S. DOLLARS 6-MOS APR-29-1998 MAY-01-1997 OCT-29-1997 1 178,980 42,246 1,070,948 0 1,555,231 3,086,473 4,183,217 1,819,255 8,383,663 2,640,266 2,457,043 0 217 107,774 2,327,848 8,383,663 4,497,352 4,497,352 2,817,617 2,817,617 0 0 126,108 698,640 266,473 432,167 0 0 0 432,167 1.18 1.16 Represents basic earnings per share in accordance with SFAS No. 128.
EX-27.3 5 FINANCIAL DATA SCHEDULE FOR PERIOD ENDED 7/30/97
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-Q FOR THE PERIOD ENDED JULY 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 U.S. DOLLARS 3-MOS APR-29-1998 MAY-01-1997 JUL-30-1997 1 168,091 29,972 1,010,079 0 1,405,848 2,868,221 4,122,000 1,782,425 8,144,930 2,807,528 2,094,148 0 232 107,774 2,328,816 8,144,930 2,233,270 2,233,270 1,408,203 1,408,203 0 0 63,311 405,314 162,013 243,301 0 0 0 243,301 0.66 0.65 Represents basic earnings per share in accordance with SFAS No. 128.
EX-27.4 6 FINANCIAL DATA SCHEDULE FOR PERIOD ENDED 4/30/97
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-K FOR THE FISCAL YEAR ENDED APRIL 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 U.S. DOLLARS YEAR APR-30-1997 MAY-02-1996 APR-30-1997 1 156,986 31,451 1,118,874 18,934 1,432,511 3,013,106 4,380,598 1,901,378 8,437,787 2,880,415 2,283,993 0 241 107,774 2,332,406 8,437,787 9,357,007 9,357,007 6,385,091 6,385,091 0 0 274,746 479,064 177,193 301,871 0 0 0 301,871 0.82 0.81 Represents basic earnings per share in accordance with SFAS No. 128.
EX-27.5 7 FINANCIAL DATA SCHEDULE FOR PERIOD ENDED 1/29/97
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-Q FOR THE PERIOD ENDED JANUARY 29, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 U.S. DOLLAR 9-MOS APR-30-1997 MAY-02-1996 JAN-29-1997 1 124,883 23,379 1,215,057 0 1,675,529 3,363,672 4,433,415 1,727,281 9,091,548 2,535,546 2,758,463 0 245 107,774 2,736,215 9,091,548 6,910,356 6,910,356 4,418,924 4,418,924 0 0 204,481 843,428 311,991 531,437 0 0 0 531,437 1.44 1.42 Represents basic earnings per share in accordance with SFAS No. 128.
EX-27.6 8 FINANCIAL DATA SCHEDULE FOR PERIOD ENDED 10/30/96
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-Q FOR THE PERIOD ENDED OCTOBER 30, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 U.S. DOLLARS 6-MOS APR-30-1997 MAY-02-1996 OCT-30-1996 1 124,030 242 1,266,348 0 1,692,847 3,449,082 4,402,028 1,709,614 9,179,657 2,380,663 2,999,734 0 246 107,774 2,744,264 9,179,657 4,602,818 4,602,818 2,959,675 2,959,675 0 0 133,985 566,745 209,695 357,050 0 0 0 357,050 0.97 0.95 Represents basic earnings per share in accordance with SFAS No. 128.
EX-27.7 9 FINANCIAL DATA SCHEDULE FOR PERIOD ENDED 7/31/96
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-Q FOR THE PERIOD ENDED JULY 31, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 U.S. DOLLARS 3-MOS APR-30-1997 MAY-02-1996 JUL-31-1996 1 145,309 16,693 1,159,989 0 1,481,122 3,156,590 4,311,864 1,662,353 8,761,528 1,910,061 3,165,082 0 263 107,774 2,650,033 8,761,528 2,208,760 2,208,760 1,413,121 1,413,121 0 0 65,844 284,968 105,438 179,530 0 0 0 179,530 0.49 0.48 Represents basic earnings per share in accordance with SFAS No. 128.
EX-27.8 10 FINANCIAL DATA SCHEDULE FOR PERIOD ENDED 5/1/96
5 THIS SUMMARY CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-K FOR THE FISCAL YEAR ENDED MAY 1, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 U.S. DOLLARS YEAR MAY-01-1996 MAY-04-1995 MAY-01-1996 1 90,064 18,316 1,207,874 17,298 1,493,963 3,046,692 4,220,044 1,603,216 8,623,691 2,715,122 2,281,659 0 271 107,774 2,598,712 8,623,691 9,112,265 9,112,265 5,775,357 5,775,357 0 0 277,411 1,023,661 364,342 659,319 0 0 0 659,319 1.79 1.75 Represents basic earnings per share in accordance with SFAS No. 128.
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