USA: American Italian Pasta 'disappointed' with Q4 performance
Struggling US pasta maker American Italian Pasta has reported a fourth-quarter net loss as its operations continued to suffer amid weak consumer demand for pasta.
The company reported a net loss of US$12.2m, or 67 cents per share, for the quarter to 1 October, compared to net income of $12.8m, or 69 cents per share, in the year-ago period.
The result from the latest quarter included $1.9m in restructuring expenses, $8.6m of costs related to inventory reduction strategy and $3.9m of expenses related to new product introduction and marketing.
Net income for the full fiscal 2004 year was $3.0m, or 16 cents per share, compared to $42.6m, or $2.31 per share, for fiscal 2003.
Fourth-quarter total revenues were $99.2m, down 15.1% from $116.9m in the fourth quarter of fiscal 2003. Full-year revenues were $417.4m, down 4.9% from $438.8m in fiscal 2003.
"The fourth quarter was very challenging for our company and we are disappointed with the operating performance. There were a number of factors contributing to the results, including deteriorating pasta market conditions and our restructuring," said president and CEO Tim Webster.
"We continue to see no significant rebound in consumer demand for pasta or the prevailing industry conditions that have impacted our ability to realise targeted profits and margins. The operational and profit impacts of the restructuring were much greater than expected; however, we believe our operations will improve over the next two quarters. We accomplished our primary restructuring goals of capacity, inventory and cost structure reductions. Our inventories are approximately $24m lower than at the beginning of the quarter, we generated $18.5m in cash and reduced debt by approximately $20m during the quarter," Webster added.
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