RSS   Newsletter   Contact   Advertise with us

Del Monte Foods results going up

Staff writer ▼ | September 13, 2013
Del Monte Foods reported net sales for the first quarter fiscal 2014 of $823.9 million compared to $821.1 million for the three months ended July 29, 2012, an increase of 0.3%.
Del Monte Foods
Del Monte FoodsDel Monte Foods reported net sales for the first quarter fiscal 2014 of $823.9 million compared to $821.1 million for the three months ended July 29, 2012, an increase of 0.3%.


The increase was driven by list pricing actions net of trade spend, primarily in Pet, largely offset by volume declines for existing products (including pricing elasticity). In addition, sales associated with the acquisition of Natural Balance Pet Foods in mid-July contributed to the increase in net sales.

Operating income increased 87.3% from $45.8 million in the prior year period to $85.8 million. The increase was driven by factors similar to net sales as noted above, in addition to lower SG&A and decreased costs associated with the closure of the Kingsburg, California facility.

Adjusted EBITDA increased 22.8% to $139.5 million compared to $113.6 million in the prior year period. The drivers of Adjusted EBITDA are similar to those of operating income, except for the cash impact of hedge positions, which was less favorable compared to the prior year.

In calculating Adjusted EBITDA, the adjustment for the cash impact from economic hedge positions are calculated pursuant to the Company's 7.625% Notes Indenture and credit agreements.

Pet Products net sales were $481.0 million, an increase of 5.0% from net sales of $458.3 million in the prior year period. The increase in Pet Products was primarily driven by net pricing as well as the acquisition of Natural Balance. The increase was partially offset by a decline in volume which includes pricing elasticity.

Consumer Products net sales were $342.9 million, a decrease of 5.5% from net sales of $362.8 million in the prior year period. The decrease in Consumer Products net sales was primarily due to a decline in unit volume sales driven by industry-wide fruit supply constraints.

In addition, there were continued business challenges in South America, including high inflation and currency devaluation in Venezuela. Net pricing, primarily due to reduced trade spending in response to fruit supply constraints, had a positive offsetting impact on net sales.


 

MORE INSIDE POST