8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 8-K

Current Report

Pursuant To Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 26, 2017

Lancaster Colony Corporation

(Exact name of registrant as specified in its charter)

Ohio	000-04065	13-1955943
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)
380 Polaris Parkway, Suite 400 Westerville, Ohio		43082
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: 614-224-7141

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Item 2.02    Results of Operations and Financial Condition

On October 26, 2017, Lancaster Colony Corporation issued a press release announcing its results for the three months ended September 30, 2017. The press release is attached as Exhibit 99.1.

Item 7.01    Regulation FD Disclosure

The following information is furnished pursuant to Item 7.01 “Regulation FD Disclosure.”

Effective July 1, 2017, David A. Ciesinski, our President and Chief Operating Officer, succeeded John B. Gerlach, Jr. as Lancaster Colony’s Chief Executive Officer. As President and Chief Executive Officer, Mr. Ciesinski became our principal executive officer and chief operating decision maker (“CODM”). This change resulted in modifications to the CODM’s approach to managing the business, assessing performance and allocating resources. Consequently, our segment reporting structure has been amended to align with these changes, and our financial results will now be presented as two reportable segments: Retail and Foodservice. Costs that are directly attributable to either Retail or Foodservice are charged directly to the appropriate segment. Costs that are deemed to be indirect, excluding corporate expenses and other unusual significant transactions, are allocated to the two reportable segments using a reasonable methodology that is consistently applied. All historical information has been retroactively conformed to the current presentation and the realigned quarterly business segment information for fiscals 2017 and 2016 is presented in Exhibit 99.2. These segment changes had no effect on previously reported consolidated net sales, operating income, net income or earnings per share.

The information in Items 2.02 and 7.01 of this Current Report on Form 8-K (including the exhibits attached hereto) is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of such section, or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01    Financial Statements and Exhibits

(d)    Exhibits:

99.1 Press Release dated October 26, 2017

99.2 Business Segment Information for the quarters of fiscals 2017 and 2016

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

LANCASTER COLONY CORPORATION    

(Registrant)

Date: October 26, 2017 By: /s/ DOUGLAS A. FELL    

Douglas A. Fell

Treasurer, Vice President,

Assistant Secretary and

Chief Financial Officer

(Principal Financial and Accounting Officer)

INDEX TO EXHIBITS

Exhibit Number	Description	Located at
99.1	Press Release dated October 26, 2017	Furnished herewith
99.2	Business Segment Information for the quarters of fiscals 2017 and 2016	Furnished herewith

EX-99.1

	Exhibit 99.1
FOR IMMEDIATE RELEASE	SYMBOL: LANC
October 26, 2017	TRADED: Nasdaq

LANCASTER COLONY REPORTS FIRST QUARTER SALES AND EARNINGS

WESTERVILLE, Ohio, October 26 - Lancaster Colony Corporation (Nasdaq: LANC) today reported results for the company’s fiscal first quarter ended September 30, 2017. Effective July 1, 2017, David A. Ciesinski succeeded John B. Gerlach, Jr. as Lancaster Colony’s Chief Executive Officer. This change resulted in modifications to the company’s approach to managing its business, assessing performance and allocating resources. Consequently, the company’s segment reporting structure has been amended to align with these changes, and our financial results will now be presented as two reportable segments: Retail and Foodservice. Additional details regarding this change are provided in the company’s Form 8-K that was filed this morning.

Highlights of the company’s results for the fiscal first quarter ended September 30, 2017 are as follows:

• Consolidated net sales increased 2.6% to a first quarter record $298.9 million versus $291.4 million last year.

• Retail net sales grew 6.2% to $162.1 million as organic sales advanced 4.0% and the sales from Angelic Bakehouse, acquired in November 2016, added 2.2%. Organic sales growth was led by volume gains from Sister Schubert's^® frozen dinner rolls, Marzetti^® caramel dips, Olive Garden^® dressings and New York BRAND^®Bakery frozen garlic bread products. Net sales of Marzetti produce dressings also showed a slight improvement in the quarter. Trade spending and coupon expenses as a percentage of net sales were flat compared to the prior-year quarter.

• Foodservice net sales decreased 1.4%, reflecting continued overall softness in the restaurant industry. Sales volumes to our national chain restaurant accounts were below the prior-year amount, partially offset by a modest level of inflationary pricing. Sales attributed to limited-time-offer programs with our national chain customers were nearly equal to last year.

• Consolidated gross profit declined $5.1 million to $75.5 million driven by the impact of increased commodity costs, most notably soybean oil, dairy ingredients, eggs and garlic, in addition to higher freight costs. Savings realized from our lean six sigma program and the inflationary foodservice pricing served to partially offset the higher freight and commodity costs in the quarter. Selling, general and administrative expenses increased $1.3 million due to incremental amortization expense and other recurring noncash charges attributed to the Angelic Bakehouse business along with recent investments in business initiatives and personnel dating back to our fiscal third quarter of last year to support continued growth.

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• Consolidated operating income declined to $44.3 million from $50.8 million in the prior year on the lower gross profit and increased SG&A expenses. Both the Retail and Foodservice segments were unfavorably influenced by the higher freight and commodity costs referenced above. Retail operating margin decreased from 22.8% to 20.3%, including the full impact of the Angelic Bakehouse noncash charges totaling $0.8 million. Foodservice operating margin dropped from 14.4% to 10.7%. The prior-year margin reflected a significant benefit from lower ingredient costs that were only partially offset by deflationary pricing. The reduction in corporate expenses within SG&A was primarily due to non-recurring costs incurred in the prior-year quarter related to closed business operations.

• Net income was $29.4 million, or $1.07 per diluted share, compared to $33.4 million, or $1.22 per diluted share, last year.

• The regular quarterly cash dividend was continued at the higher level of $.55 per share set in November 2016. The company’s balance sheet remained debt free on September 30, 2017 with $157.2 million in cash and equivalents.

CEO David A. Ciesinski commented, “We were pleased with the sales growth in our Retail segment that led to a record level of consolidated net sales in the fiscal first quarter. We will continue to rely upon our strengths in innovation and product development to drive top line growth. A recent example of this is our new Marzetti^® Simply 60^TM line of refrigerated dressings for the retail market with 60 calories per serving made with simple ingredients such as real buttermilk and extra virgin olive oil.

Looking ahead to our fiscal second quarter, historically our biggest sales quarter of the year, we expect higher freight costs to persist due to higher freight premiums resulting from constrained capacity in the aftermath of the recent hurricanes in the southern U.S. We also anticipate commodity costs to remain a headwind with eggs, soybean oil, dairy ingredients and garlic showing notable cost increases over the prior year. Savings gained from our lean six sigma projects, some inflationary pricing in the foodservice channel and net price realization initiatives now underway in retail will help to offset increased costs.”

Conference Call on the Web

The company’s first quarter conference call is scheduled for this morning, October 26, at 10:00 a.m. ET. You may access a live webcast of the call through a link on the company’s Internet home page at www.lancastercolony.com. A replay of the webcast will also 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 channels.

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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:

• fluctuations in the cost and availability of ingredients and packaging;

• adverse changes in freight, energy or other costs of producing, distributing or transporting our products;

• price and product competition;

• the reaction of customers or consumers to price increases we may implement;

• the impact of customer store brands on our branded retail volumes;

• capacity constraints that may affect our ability to meet demand or may increase our costs;

• dependence on contract manufacturers;

• the success and cost of new product development efforts;

• dependence on key personnel and changes in key personnel;

• the effect of consolidation of customers within key market channels;

• the lack of market acceptance of new products;

• the ability to successfully grow recently acquired businesses;

• the extent to which future business acquisitions are completed and acceptably integrated;

• the possible occurrence of product recalls or other defective or mislabeled product costs;

• the potential for loss of larger programs or key customer relationships;

• changes in demand for our products, which may result from loss of brand reputation or customer goodwill;

• maintenance of competitive position with respect to other manufacturers;

• efficiencies in plant operations;

• the impact of any regulatory matters affecting our food business, including any required labeling changes and their impact on consumer demand;

• stability of labor relations;

• the outcome of any litigation or arbitration;

• the impact, if any, of certain contingent liabilities associated with our withdrawal from a multiemployer pension plan;

• the impact of fluctuations in our pension plan asset values on funding levels, contributions required and benefit costs;

• changes in estimates in critical accounting judgments; and

• risks 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.

# # # #

FOR FURTHER INFORMATION:	Douglas A. Fell, 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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LANCASTER COLONY CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

(In thousands except per-share amounts)

	Three Months Ended   September 30,
	2017		2016
Net sales	$	298,916	$	291,361
Cost of sales	223,439		210,727
Gross profit	75,477		80,634
Selling, general & administrative expenses	31,151		29,880
Operating income	44,326		50,754
Other, net	358		87
Income before income taxes	44,684		50,841
Taxes based on income	15,298		17,441
Net income	$	29,386	$	33,400
Net income per common share: (a)
Basic and diluted	$	1.07	$	1.22
Cash dividends per common share	$	0.55	$	0.50
Weighted average common shares outstanding:
Basic	27,396		27,363
Diluted	27,451		27,430

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

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LANCASTER COLONY CORPORATION

BUSINESS SEGMENT INFORMATION (Unaudited)

(In thousands)

	Three Months Ended   September 30,
	2017			2016
NET SALES
Retail	$	162,144		$	152,662
Foodservice	136,772			138,699
Total Net Sales	$	298,916		$	291,361
OPERATING INCOME
Retail	$	32,867		$	34,806
Foodservice	14,688			20,019
Corporate expenses	(3,229		)	(4,071		)
Total Operating Income	$	44,326		$	50,754

LANCASTER COLONY CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

(In thousands)

	September 30,   2017		June 30,   2017
ASSETS
Current assets:
Cash and equivalents	$	157,178	$	143,104
Receivables	82,944		69,922
Inventories	85,266		76,376
Other current assets	5,704		11,744
Total current assets	331,092		301,146
Net property, plant and equipment	183,797		180,671
Other assets	234,274		234,588
Total assets	$	749,163	$	716,405

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	47,796	$	41,353
Accrued liabilities	47,820		35,270
Total current liabilities	95,616		76,623
Other noncurrent liabilities and deferred income taxes	63,001		63,805
Shareholders’ equity	590,546		575,977
Total liabilities and shareholders’ equity	$	749,163	$	716,405

# # # #

EX-99.2

Exhibit 99.2

Lancaster Colony Corporation
Business Segment Information (Unaudited)
Realigned to Reflect the New Reportable Segments
Fiscal 2017 & 2016
(In thousands)
													Year Ended
	First			Second			Third			Fourth			June 30,
	Quarter			Quarter			Quarter			Quarter			2017
Net Sales
Retail Segment	$	152,662		$	182,794		$	151,782		$	154,179		$	641,417
Foodservice Segment	138,699			143,979			142,052			135,695			560,425
Consolidated Totals	$	291,361		$	326,773		$	293,834		$	289,874		$	1,201,842
Operating Income
Retail Segment	$	34,806		$	42,905		$	29,129		$	31,630		$	138,470
Foodservice Segment	20,019			19,147			13,590			13,460			66,216
Multiemployer Pension Settlement and Related Costs	—			—			(17,639		)	4			(17,635		)
Corporate Expenses	(4,071		)	(2,694		)	(3,067		)	(2,471		)	(12,303		)
Consolidated Totals	$	50,754		$	59,358		$	22,013		$	42,623		$	174,748
													Year Ended
	First			Second			Third			Fourth			June 30,
	Quarter			Quarter			Quarter			Quarter			2016
Net Sales
Retail Segment	$	148,482		$	178,180		$	147,467		$	145,255		$	619,384
Foodservice Segment	145,603			146,589			140,298			139,235			571,725
Consolidated Totals	$	294,085		$	324,769		$	287,765		$	284,490		$	1,191,109
Operating Income
Retail Segment	$	35,322		$	41,198		$	27,145		$	31,235		$	134,900
Foodservice Segment	9,639			14,231			19,331			18,491			61,692
Corporate Expenses	(3,073		)	(3,314		)	(2,532		)	(3,103		)	(12,022		)
Consolidated Totals	$	41,888		$	52,115		$	43,944		$	46,623		$	184,570