US: Pinnacle net profit rises on lower charges

Pinnacle Foods Finance LLC Reports Fourth Quarter Fiscal 2012 Results
PARSIPPANY, N.J., March 6, 2013 /PRNewswire/ -- Pinnacle Foods Finance LLC today announced its financial results for the fourth quarter and fiscal year ended December 30, 2012.  Net sales for the quarter increased 3% versus year-ago to $705 million, and net earnings in the quarter were $44 million, after giving effect to approximately $10 million of after-tax charges, primarily related to restructuring.  For 2012, net sales of $2.48 billion were essentially even with year-ago, and net earnings were $53 million, after giving effect to approximately $51 million of after-tax charges, principally related to restructuring and refinancing.
Commenting on the results, Pinnacle Foods Chief Executive Officer Bob Gamgort stated, "We posted solid performance in the fourth quarter by delivering a 3% increase in adjusted EBITDA.  In a food industry environment that is showing some signs of improving, we generated share growth on more than half of our portfolio, driving 4% net sales growth on our North America retail business.  Further, we expanded gross margin, excluding restructuring, as inflation moderated and our productivity initiatives accelerated."
Fourth Quarter 2012
Net sales of $705 million in the fourth quarter of 2012 increased 3%, compared to net sales of $686 millionin the year-ago period.  This performance reflected the benefit of a 53rd week in 2012 which added approximately 4% for the quarter, as well as favorable mix, partially offset by the impact of the Company's exit from lower-margin businesses in its Specialty Division.
Net sales in the Company's North America retail businesses increased 4% in the quarter, largely reflecting the 53rd week in 2012. By brand, the Company registered sales growth for Birds Eye® Voila!^TM,Van de Kamp's® and Mrs. Paul's® frozen seafood, Vlasic® pickles and Log Cabin® syrups, while net sales of  Birds Eye® vegetables, Duncan Hines® baking products and Aunt Jemima® frozen breakfasts declined. 
Adjusted EBITDA, as defined in the Company's borrowing agreements, advanced 3% to $153 million in the fourth quarter of 2012, compared to Adjusted EBITDA of $149 million in the year-ago quarter.  Adjusted EBITDA is defined below under "Non-GAAP Financial Measures" and is reconciled to Net Earnings (Loss) in the tables that accompany this release.
Earnings before interest and taxes (EBIT) were $117 million in the fourth quarter of 2012, after giving effect to $16 million of pre-tax charges primarily related to restructuring, compared to a loss at the EBIT line in the fourth quarter of 2011 of $(26) million, which included $155 million of pre-tax charges primarily related to goodwill and tradename impairments.  Excluding these charges in both periods, EBIT for the quarter improved 3% versus year-ago to $133 million. This improved performance resulted from strong productivity results and moderating inflation.  Also, the 53rd week increased the comparison by approximately 4%. Partially offsetting these improvements was lower performance-based compensation expense in 2011.  Excluding the two items from both years, adjusted EBIT increased 5%. 
The Company reported net earnings of $44 million in the fourth quarter of 2012, after giving effect to approximately $10 million of after-tax charges primarily related to restructuring, compared to a net loss of$(88) million in the fourth quarter of 2011, which included $133 million of after-tax charges primarily related to goodwill and tradename impairments.  Excluding these charges in both periods, net earnings advanced 17% to $54 million in the fourth quarter of 2012, compared to approximately $46 million in the year-ago quarter.  This improvement reflected the increase in EBIT, as well as lower interest expense, stemming from the Company's refinancing activities and lower overall debt levels.
Fiscal Year 2012
Net sales of $2.48 billion in 2012 were essentially even with net sales of $2.47 billion in 2011.   Net sales in the Company's North America retail businesses increased 1% to $2.08 billion in 2012, compared to net sales of $2.07 billion in the year-ago period.  The 53rd week in 2012 benefited both the consolidated and the North America retail net sales comparisons by approximately 1%.
Adjusted EBITDA was $426 million in the fiscal year 2012, compared to Adjusted EBITDA of $450 millionin 2011.
EBIT in 2012 was $284 million, after giving effect to $66 million in pre-tax charges principally related to restructuring and refinancing, compared to EBIT in the year-ago period of $183 million, which included$192 million in pre-tax charges primarily related to impairments, restructuring and a legal settlement. 
Net earnings in 2012 were $53 million, after giving effect to $51 million in after-tax charges, primarily related to restructuring and refinancing compared to a net loss in 2011 of $(47) million, which included$156 million of after-tax charges, primarily related to impairments, restructuring and a legal settlement.
Net cash provided by operating activities in 2012 was $203 million, compared to net cash provided by operating activities of $204 million in the year-ago period.  Total capital expenditures, including footprint consolidation, were $78 million in 2012 compared to $117 million in 2011.  Ongoing capital expenditures, excluding footprint consolidation, were $70 million in 2012 and $88 million in 2011.

Original source: Pinnacle Foods Finance LLC