Tasty Baking Company (NYSE:TBC – news), today announced financial results for the second quarter and twenty-six weeks ended June 24, 2000.
For the second quarter, gross sales were $62.9 million, compared to $56.8 million last year, an increase of 10.8%. Gross sales, less discounts and allowances, resulted in net sales of $41.7 million, compared to $38.5 million reported last year, an increase of 8.3%. Net income for the thirteen weeks increased 60% to $2.2 million, compared to $1.4 million reported last year. Earnings per diluted share increased 60% to $0.28 compared to $0.18 per diluted share reported during the prior year’s second quarter.
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For the twenty-six weeks ended June 24, 2000, gross sales were $124.0 million, compared to $113.9 million last year, an increase of 9%. Gross sales, less discounts and allowances, resulted in net sales of $82.1 million, compared to $76.4 million reported last year, an increase of 7.5%. Net income was $4.2 million, or $0.54 per diluted share, compared to $1.7 million, or $0.22 per diluted share reported during the prior period. Results for the twenty-six weeks ended June 26, 1999 include the effect of a restructure charge related to the discontinuation of route territories and the effect of a change in accounting principle for startup costs, which combined, represent $0.10 per diluted share. Therefore, on an operating basis, net income per diluted share for twenty-six weeks ended June 26, 1999 was $0.32. The net income per diluted share of $0.54 for the twenty-six weeks ended June 24, 2000, represents a 69% increase over the operating results for the comparable period in 1999.
Carl S. Watts, Chairman and Chief Executive Officer, commented, “We are very pleased with the results for the second quarter 2000. We have experienced three consecutive quarters of strong earnings growth, which has fueled our turnaround. Sales in every phase of the business performed well. Route sales operations showed a sales dollar increase of 7% while national sales delivered a 26% increase. We were particularly pleased that unit sales increased by 10% during the quarter.”
Mr. Watts noted, “We are seeing positive results in the areas of productivity and efficiency, as we proceed with the second phase of our plant modernization. Despite the increased cost in energy, our operating expenses came in nicely under this year’s budget and also compared favorably to last year.”
Mr. Watts continued, “We are pleased with the progress we are making at our Oxford facility. During the quarter we introduced two new products to our multi-serve Classic Baked Goods line. These products are performing up to expectations. The progress currently being made at Oxford is contributing to our operating results and we expect continued improvement as we move through the remainder of 2000. Our relationship with Wal-Mart continues to grow and the increased distribution to several Wal-Mart centers during the quarter has had a positive impact on our results. We expect this relationship to grow nicely as we look ahead to the future.”
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By GlobalDataMr. Watts concluded, “Looking ahead for the remainder of year 2000, we expect competition to remain very active, however, we anticipate introducing new initiatives during the third and fourth quarters that we expect will enable us to deliver positive results for the remainder of the year.”
Tasty Baking Company is one of the largest independent baking companies in the United States, and is the leading snack cake provider of the Mid-Atlantic region. The Company operates three bakeries in the Mid-Atlantic region, and distributes its products in 47 states under the Tastykake brand name.
Except for historical information contained herein, the matters discussed are forward-looking statements (as such term is defined in the Securities Act of 1933, as amended) and because such statements include risks and uncertainties, actual results may differ materially from those forward-looking statements.
TASTY BAKING COMPANY AND SUBSIDIARIES
CONSOLIDATED HIGHLIGHTS OF OPERATING RESULTS
(Unaudited)
13 Weeks Ended 26 Weeks Ended
————————- ———————-
6/24/00 6/26/99 6/24/00 6/26/99
——- ——- ——- ——-
Gross sales $ 62,899,396 $ 56,769,425 $124,047,156 $113,915,599
Less discounts
and allowances (21,181,024) (18,265,519) (41,985,438) (37,559,044)
———— ———— ———— ————
Net sales 41,718,372 38,503,906 82,061,718 76,356,555
———— ———— ———— ————
Cost of sales 26,379,584 24,069,240 52,376,596 47,701,305
Depreciation 1,819,469 1,905,532 3,681,836 3,691,314
Operating expenses 9,984,356 10,470,880 19,307,783 21,401,425
Restructure charge (a) – – – 950,000
Interest expense and
other (income), net 72,102 (66,656) 100,793 (188,148)
———– ———– ———– ———–
38,255,511 36,378,996 75,467,008 73,555,896
———– ———– ———– ———–
Income before
provision for
income taxes 3,462,861 2,124,910 6,594,710 2,800,659
Provision for
income taxes (1,238,468) (733,109) (2,347,801) (882,579)
———– ———– ———– ———–
Income before
cumulative effect
of a change
in accounting
principle 2,224,393 1,391,801 4,246,909 1,918,080
Cumulative effect
of a change in
accounting principle
for start-up costs – – (204,709)
———– ———– ———– ———–
Net income $ 2,224,393 $ 1,391,801 $ 4,246,909 $ 1,713,371
=========== =========== =========== ===========
Average number of
shares outstanding:
Basic 7,831,331 7,825,206 7,827,270 7,825,396
Diluted 7,847,203 7,867,647 7,835,206 7,894,582
Per share of
common stock:
Income before
cumulative effect
of a change in
accounting principle:
Basic $0.28 $0.18 $0.54 $0.25
Diluted $0.28 $0.18 $0.54 $0.24
Cumulative effect
of a change in
accounting principle
for start-up costs:
Basic & Diluted – – – (0.03)
——– ——– ——– ——–
Net income:
Basic $0.28 $0.18 $0.54 $0.22
======== ======== ======== ========
Diluted $0.28 $0.18 $0.54 $0.22
======== ======== ======== ========
Cash dividend $0.12 $0.12 $0.24 $0.24
======== ======== ======== ========
(a) During the first quarter of 1999, the company incurred a $950,000
restructuring charge related to its decision to discontinue route
territories in those areas that were not achieving appropriate
levels of profitability. The after tax effect of this charge was
$570,000 or $.07 per diluted share.
