EX-99.1 2 d586329dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

LOGO

 

FOR IMMEDIATE RELEASE   SYMBOL: LANC
Thursday, August 22, 2013   TRADED: Nasdaq

LANCASTER COLONY REPORTS FISCAL YEAR AND FOURTH QUARTER RESULTS

COLUMBUS, Ohio, Aug. 22 –Lancaster Colony Corporation (Nasdaq: LANC) today reported these highlights for the company’s fiscal year ended June 30, 2013:

 

   

Net sales increased three percent to $1,166 million versus $1,131 million last year.

 

   

Net income increased 14 percent to $109.2 million or $3.99 per diluted share, compared to the prior-year’s net income of $95.8 million, or $3.51 per diluted share. Pretax income associated with second quarter distributions under the Continued Dumping and Subsidy Offset Act amounted to $0.3 million (approximately one cent per share after taxes) in fiscal 2013 and $2.7 million (approximately six cents per share after taxes) in fiscal 2012.

 

   

The quarterly cash dividend was increased for the 50th consecutive year. A $5 per share special dividend was also paid this past December.

 

   

The balance sheet remained strong with no debt outstanding and over $123 million in cash and equivalents.

Fourth Quarter Results

Highlights of the fourth quarter ended June 30, 2013 included the following:

 

   

Net sales decreased two percent to $269 million versus $274 million in the year ago quarter.

 

   

Specialty Foods net sales totaled $245.2 million, off one percent from the prior-year’s record fourth quarter total, reflecting slightly lower volumes and higher levels of coupon redemption costs. The prior-year’s fourth quarter retail volumes benefited from an unusually strong level of new product introduction not repeated in this year’s fourth quarter. Segment operating income declined seven percent to $38.9 million from $42.0 million a year ago primarily due to increased investments in consumer-driven marketing and promotional costs. In 2012, these costs were more skewed to earlier in the fiscal year. The prior-year’s fourth quarter income also included approximately $1 million in vendor recoveries associated with a fiscal 2010 product recall. The impact of material cost and pricing between quarters was not significant.

 

   

In its seasonally weakest quarter, Glassware and Candles sales of $24.1 million declined six percent from year-ago levels. The segment’s operating income of $0.2 million compared to an operating loss of $0.2 million in 2012. The quarter’s results reflected an improved sales mix, but also a loss on sale of approximately $0.4 million from exiting certain product lines, including glass drinkware, sold into commercial channels.

 

   

Fourth quarter net income totaled $25.5 million, or $.93 per diluted share, versus the year-ago net income of $26.0 million, or $.95 per diluted share. Quarterly income taxes for 2013 included the after-tax benefit of approximately $0.7 million from the release of reserves associated with uncertain tax positions.

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PAGE 2 / LANCASTER COLONY REPORTS FISCAL YEAR AND 4TH QUARTER RESULTS

 

Fiscal 2013 Commentary

Chairman and CEO John B. Gerlach, Jr. said, “While our fourth quarter results reflected challenging comparisons to a strong year-ago quarter, we were pleased with the year’s solid growth in sales and net income. Both of our operating segments achieved full-year improvements in net sales and operating income with recent product introductions helping to push Specialty Foods net sales over the $1 billion mark for the first time. Specialty Foods results also reflected modest improvement in both pricing and material costs.”

Fiscal 2014 Commentary

Mr. Gerlach added, “We are optimistic about fiscal 2014 as driven by anticipated growth in Specialty Foods. This improvement is expected through added volumes from several newer retail and foodservice programs, as well as through further market expansion of certain key product lines. We also foresee the potential for modestly favorable material cost comparisons as we move later into the fiscal year. Glassware and Candles sales and operating income are expected to be challenged by weaker customer demand and lower production levels. We believe our strong and flexible balance sheet supports our future growth potential, including appropriate food-related business investments and acquisitions.”

Conference Call on the Web

The company’s fiscal year and fourth quarter conference call is scheduled for this morning, August 22, at 10:00 a.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 diversified manufacturer and marketer of consumer products focusing primarily on specialty foods for the retail and foodservice markets.

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PAGE 3 / LANCASTER COLONY REPORTS FISCAL YEAR AND 4TH QUARTER RESULTS

 

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:

 

   

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

 

   

the effect of consolidation of customers within key market channels;

 

   

the success and cost of new product development efforts;

 

   

the lack of market acceptance of new products;

 

   

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

 

   

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

 

   

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

 

   

price and product competition;

 

   

fluctuations in the cost and availability of raw materials;

 

   

adverse changes in energy costs and other factors that may affect costs of producing, distributing or transporting our products;

 

   

maintenance of competitive position with respect to other manufacturers, including global sources of production;

 

   

dependence on key personnel;

 

   

stability of labor relations;

 

   

dependence on contract copackers and limited or exclusive sources for certain goods;

 

   

changes in estimates in critical accounting judgments;

 

   

the outcome of any litigation or arbitration; 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 such statements that are based on current expectations.

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FOR FURTHER INFORMATION:    John B. Gerlach, Jr., Chairman and CEO, or
   John L. Boylan, Vice President, Treasurer and CFO
   Lancaster Colony Corporation
   Phone: 614/224-7141
   —or—
   Investor Relations Consultants, Inc.
   Phone: 727/781-5577 or E-mail: lanc@mindspring.com

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PAGE 4 / LANCASTER COLONY REPORTS FISCAL YEAR AND 4TH QUARTER RESULTS

 

LANCASTER COLONY CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

(In thousands except per-share amounts)

 

     Three Months Ended
June 30,
   

Fiscal Year Ended

June 30,

 
     2013     2012     2013      2012  

Net sales

   $ 269,267      $ 273,959      $ 1,165,909       $ 1,131,359   

Cost of sales

     208,355        212,939        898,800         891,248   
  

 

 

   

 

 

   

 

 

    

 

 

 

Gross margin

     60,912        61,020        267,109         240,111   

Selling, general & administrative expenses

     24,510        21,909        105,203         96,824   
  

 

 

   

 

 

   

 

 

    

 

 

 

Operating income

     36,402        39,111        161,906         143,287   

Interest income and other – net

     (128     (30     77         2,744   
  

 

 

   

 

 

   

 

 

    

 

 

 

Income before income taxes

     36,274        39,081        161,983         146,031   

Taxes based on income

     10,797        13,126        52,734         50,223   
  

 

 

   

 

 

   

 

 

    

 

 

 

Net income

   $ 25,477      $ 25,955      $ 109,249       $ 95,808   
  

 

 

   

 

 

   

 

 

    

 

 

 

Net income per common share:(a)

         

Basic

   $ .93      $ .95      $ 4.00       $ 3.51   

Diluted

   $ .93      $ .95      $ 3.99       $ 3.51   
         

Cash dividends per common share

   $ .40      $ .36      $ 6.52       $ 1.41   
         

Weighted average common shares outstanding:

         

Basic

     27,277        27,222        27,252         27,233   

Diluted

     27,316        27,254        27,285         27,265   

 

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

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PAGE 5 / LANCASTER COLONY REPORTS FISCAL YEAR AND 4TH QUARTER RESULTS

 

LANCASTER COLONY CORPORATION

BUSINESS SEGMENT INFORMATION (Unaudited)

(In thousands)

 

     Three Months Ended
June 30,
   

Fiscal Year Ended

June 30,

 
     2013     2012     2013     2012  

NET SALES

        

Specialty Foods

   $ 245,190      $ 248,333      $ 1,013,803      $ 988,937   

Glassware and Candles

     24,077        25,626        152,106        142,422   
  

 

 

   

 

 

   

 

 

   

 

 

 
   $ 269,267      $ 273,959      $ 1,165,909      $ 1,131,359   
  

 

 

   

 

 

   

 

 

   

 

 

 

OPERATING INCOME (LOSS)

        

Specialty Foods

   $ 38,920      $ 41,969      $ 165,710      $ 151,479   

Glassware and Candles

     174        (167     7,983        2,105   

Corporate expenses

     (2,692     (2,691     (11,787     (10,297
  

 

 

   

 

 

   

 

 

   

 

 

 
   $ 36,402      $ 39,111      $ 161,906      $ 143,287   
  

 

 

   

 

 

   

 

 

   

 

 

 

LANCASTER COLONY CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

(In thousands)

 

     June 30,
2013
     June 30,
2012
 

ASSETS

     

Current assets:

     

Cash and equivalents

   $ 123,386       $ 191,636   

Receivables – net of allowance for doubtful accounts

     70,398         73,326   

Total inventories

     109,151         109,704   

Deferred income taxes and other current assets

     23,123         17,073   
  

 

 

    

 

 

 

Total current assets

     326,058         391,739   

Net property, plant and equipment

     189,695         184,130   

Other assets

     104,211         106,766   
  

 

 

    

 

 

 

Total assets

   $ 619,964       $ 682,635   
  

 

 

    

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

     

Current liabilities:

     

Accounts payable

   $ 41,890       $ 40,708   

Accrued liabilities

     35,287         31,963   
  

 

 

    

 

 

 

Total current liabilities

     77,177         72,671   

Other noncurrent liabilities and deferred income taxes

     41,565         45,697   

Shareholders’ equity

     501,222         564,267   
  

 

 

    

 

 

 

Total liabilities and shareholders’ equity

   $ 619,964       $ 682,635   
  

 

 

    

 

 

 

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