Snack foods producer Lance has posted net income for the year to 31 December 2005 of US$18.5m, or $0.61 per share, against net income for the year to 25 December 2004 of $24.9m, or $0.84 per share.
However, the company said that income in the fourth quarter had been reduced by costs relating to the acquisition of Tom’s Foods in October 2005. Lance said that excluding the acquisition-related costs in the fourth quarter and one-time charges related to severance in the second quarter, earnings would have been $0.74 per diluted share for the full year.
Net sales for the year reached US$679.3m, representing an increase of 13% on 2004. With the impact of the Tom’s acquisition stripped out and allowing for the extra week in 2005, the sales increase was around 8%, the company said.
Net income for the fourth quarter reached $1.5m, or $0.05 per diluted share. Excluding the one-time charges related to the Tom’s Acquisition, earnings would have been $0.13 per diluted share for the quarter. This still represents a significant drop from the fourth quarter of 2004 which saw net income of $6.2m, or $0.21 per diluted share. But net sales for the fourth quarter rose by 30% to $193.8m.
“While I’m disappointed with our earnings results in the fourth quarter, I’m very pleased with the strength of our revenue performance throughout 2005 and the solid growth momentum that we carry into the current year,” said Lance’s president and CEO David V. Singer. “As we move into 2006, we are focused on maintaining sales momentum in sandwich crackers and salty snacks, implementing revenue management strategies targeted at enhancing profit margins, integrating the Tom’s acquisition and executing on our supply chain restructuring plan.”
Lance is forecasting net sales for the full 2006 year of around $750m to $775m, with earnings per diluted share of between $0.65 and $0.70, including one-time charges.
