Snyder's-Lance, Inc.
May 5, 2011

Snyder's-Lance, Inc. Reports Results for First Quarter 2011

CHARLOTTE, N.C., May 5, 2011 /PRNewswire/ --

  • Net revenue of $388 million, a 75% increase over 2010
  • Reports 2011 first quarter earnings per diluted share of $0.17 excluding special items
  • Reports 2011 first quarter earnings per diluted share of $0.16 including special items
  • Declares quarterly dividend of $0.16 per share on common stock
  • Comparisons made in this release to prior year relate to the prior year reported results for Lance, Inc. only

Snyder's-Lance, Inc. (Nasdaq-GS: LNCE) today reported results for its first quarter of 2011.  Financial results include the first full quarter of operations following the merger with Snyder's of Hanover, Inc.("Merger"), which was completed on December 6, 2010.

(Logo: http://photos.prnewswire.com/prnh/20110411/CL80943LOGO )

Net revenues for the first quarter ended April 2, 2011, were $388 million, an increase of 75% over prior year net revenues of $222 million that were reported by Lance, Inc. ("Lance")prior to the Merger. This growth was primarily a result of the incremental revenue resulting from the Merger and was supported by solid growth across our core products. In the first quarter of 2011, we realized net income excluding special items of $11.8 million, or $0.17 per diluted share, as compared to first quarter 2010 net income excluding special items of $1.2 million, or $0.04 per diluted share that was reported by Lance prior to the Merger. Net income including special items was $10.8 million for the first quarter of 2011 compared to a net loss of $0.7 million for the first quarter of 2010.  Special items for the first quarter of 2011 included after-tax expenses of $1.0 million related to the Merger.  The special items for the first quarter of 2010 included after-tax expenses of $1.9 million associated with merger and acquisition activity.

Comments from Management

"We continue to be very excited about the Merger which has created Snyder's-Lance," commented David V. Singer, Chief Executive Officer.  "Our first quarter results were strong, and I am extremely proud of everyone at Snyder's-Lance for delivering these great results while making real progress toward integration. Our branded products showed solid growth for the first quarter, and we anticipate good performance for the balance of 2011.  We have started to execute our integration plan, including the transition of company owned routes to independent operators as outlined in our recent press release.  Most major organizational decisions have been announced, and we are now focused on serving our customers, continuing to plan and execute our integration plans, and working to realize the synergies and cost savings anticipated from the Merger.  As previously discussed, we expect to complete the vast majority of our integration by mid-2012, and are committed to delivering solid financial results while completing this work. We have a number of demanding months ahead, but I am confident in our team to drive day-to-day results while completing this important effort."

Dividend Declared

The Company also announced the declaration of a quarterly cash dividend of $0.16 per share on the Company's common stock.  The dividend is payable on May 24, 2011 to stockholders of record at the close of business on May 16, 2011.

Guidance Provided for 2011

As previously discussed, we anticipate delivering a portion of our anticipated cost and revenue synergies in the latter half of 2011, but most of our integration plan will not be completed until mid-2012.  When synergies are fully realized, the benefits from integration and sales growth are expected to deliver 2.5% to 3.0% improvements in operating profit margins off our 2010 base.

Overall, we expect that 2011 performance will continue to be difficult to predict as a number of variables may impact earnings and revenue in the short term while we continue the integration. However, we are estimating full year 2011 earnings per share (EPS)to be in a range of $0.85 to $1.00 on a fully diluted basis.  Additionally, we estimate that net revenue will be between $1.59 and $1.65 billion for the full year 2011, and estimate capital expenditures to be in a $60 million to $70 million range for the year.  

Conference Call

Snyder's-Lance, Inc. has scheduled a conference call and presentation with investors at 9:00 am eastern time on Thursday, May 5, 2011 to discuss financial results.  To participate in the conference call, the dial-in number is (866) 814-7293 for U.S. callers or (702) 696-4943 for international callers.  A continuous telephone replay of the call will be available between 1:00 pm on May 5th and midnight on May 12th.  The replay telephone number is (800) 642-1687 for U.S. callers or (706) 645-9291 for international callers.  The replay access code is 60735608.  Investors may also access a web-based replay of the conference call at Snyder's-Lance's web site, www.lanceinc.com.

The conference call and accompanying slide presentation will be webcast live through the Investor Relations section of Snyder's-Lance, Inc.'s website www.lanceinc.com. In addition, the slide presentation will be available to download and print approximately 30 minutes before the webcast at Snyder's-Lance's Investor Relations home page.

About Snyder's-Lance, Inc.

Snyder's-Lance, Inc., headquartered in Charlotte, North Carolina, manufactures, markets and distributes snack foods throughout the United States and internationally. The company's products include pretzels, sandwich crackers, potato chips, cookies, tortilla chips, restaurant style crackers, nuts and other snacks. Snyder's-Lance, Inc. has manufacturing facilities in North Carolina, Pennsylvania, Iowa, Indiana, Georgia, Arizona, Massachusetts, Texas, Florida, Ohio, and Ontario, Canada. Products are sold under brand names including Snyder's of Hanover, Lance, Cape Cod, Tom's, Jays, Krunchers!, Grande, Archway, O-Ke-Doke, and Stella D'oro along with a number of private label and third party brands. Products are distributed widely through grocery and mass merchandisers, convenience stores, club stores, food service outlets and other channels.

This news release contains statements which may be forward looking within the meaning of applicable securities laws. The statements may include projections regarding future earnings and results which are based upon the company's current expectations and assumptions, which are subject to a number of risks and uncertainties. Factors that could cause actual results to differ include: general economic conditions; increases in cost or availability of ingredients, packaging, energy and employees; price competition and industry consolidation; loss of major customers or changes in product offerings with significant customers; business disruption from merger integration and conversion of our distribution network to independent operators, including failure to realize anticipated synergies in a timely manner or the loss of key personnel; failure to maintain proper and effective internal controls; ability to execute strategic initiatives; product recalls and concerns surrounding the quality or safety of products and ingredients; disruptions to our supply chain or information technology systems; changes in consumer preferences; inability to maintain existing markets or expand to other geographic markets; potential threats to trademarks and other proprietary intellectual rights; food industry and regulatory factors; interest rate and foreign exchange rate risks; and the interests of significant stockholders may conflict with those of other stockholders, which have been discussed in greater detail in our most recent Form 10-K and other reports filed with the Securities and Exchange Commission.

SNYDER'S-LANCE, INC. AND SUBSIDIARIES


Condensed Consolidated Statements of Income/(Loss) (Unaudited)

For the Quarters Ended April 2, 2011 and March 27, 2010

(in thousands, except per share data)



Quarter Ended


April 2,
2011


March 27,
2010*





Net revenue

$   388,471


$   221,617

Cost of sales

247,299


137,742

Gross margin

141,172


83,875





Selling, general and administrative

120,905


80,420

Other expense, net

39


3,610

Income/(loss) before interest and income taxes

20,228


(155)





Interest expense, net

2,660


860

Income/(loss) before income taxes

17,568


(1,015)





Income tax expense/(benefit)

6,525


(330)

Net income/(loss)

11,043


(685)

Net income attributable to noncontrolling interests

194


-

Net income/(loss) attributable to Snyder's-Lance, Inc.

$   10,849


$   (685)





Basic earnings/(loss) per share

$   0.16


$   (0.02)

Weighted average shares outstanding — basic

66,732


31,758





Diluted earnings/(loss) per share

$   0.16


$   (0.02)

Weighted average shares outstanding — diluted

68,060


31,758





Cash dividends declared per share

$  0.16


$  0.16


* Quarter Ended March 27, 2010 amounts have been revised to reflect the change in accounting for inventory.




SNYDER'S-LANCE, INC. AND SUBSIDIARIES


Condensed Consolidated Balance Sheets  

As of April 2, 2011(Unaudited) and January 1, 2011

(in thousands, except share data)



April 2,
2011


January 1,
2011

ASSETS








Current assets:




 Cash and cash equivalents

$   6,362


$   27,877

 Accounts receivable, net of allowances of $3,289 and $2,899, respectively

142,248


128,556

 Inventories

102,947


96,936

 Income tax receivable

32,743


29,304

 Deferred income taxes

9,905


14,346

 Prepaid expenses and other current assets

24,248


26,748

Total current assets

318,453


323,767





Noncurrent assets:




 Fixed assets, net of accumulated depreciation of $311,015 and $299,877, respectively

340,947


336,673

 Goodwill, net

377,895


376,281

 Other intangible assets, net

406,693


407,579

 Other noncurrent assets

18,796


18,056

    Total assets

$   1,462,784


$   1,462,356





LIABILITIES AND STOCKHOLDERS' EQUITY








Current liabilities:




 Accounts payable

$   49,535


$   39,938

 Accrued compensation

28,611


31,564

 Other payables and accrued liabilities

58,851


64,000

 Current portion of long-term debt

58,666


57,767

Total current liabilities

195,663


193,269





Noncurrent liabilities:




 Long-term debt

217,320


227,462

 Deferred income taxes

186,047

180,812

 Other noncurrent liabilities

21,836


24,198

Total liabilities

620,866


625,741





Commitments and contingencies

-


-





Stockholders' equity:




 Common stock, 67,189,213 and 66,336,807 shares outstanding, respectively

55,989


55,278

 Preferred stock, no shares outstanding

-


-

 Additional paid-in capital

723,568


722,007

 Retained earnings

40,463


40,199

 Accumulated other comprehensive income

17,859


15,104

Total Snyder's-Lance, Inc. stockholders' equity

837,879


832,588

 Noncontrolling interests

4,039


4,027

Total stockholders' equity

841,918


836,615

    Total liabilities and stockholders' equity

$  1,462,784


$  1,462,356




SNYDER'S-LANCE, INC. AND SUBSIDIARIES


Condensed Consolidated Statements of Cash Flows (Unaudited)

For the Quarters Ended April 2, 2011 and March 27, 2010

(in thousands)



Quarter Ended


April 2,
2011


March 27,
2010*





Operating activities




Net income/(loss)

$     11,043


$     (685)

 Adjustments to reconcile net income/(loss) to cash from operating activities:




   Depreciation and amortization

14,061


9,596

   Stock-based compensation expense

338


1,821

   (Gain)/loss on sale of fixed and intangible assets

(48)


54

   Impairment of fixed assets

-


584

   Changes in operating assets and liabilities

(12,982)


(12,904)

 Net cash provided by/(used in) operating activities

12,412


(1,534)





Investing activities




 Purchases of fixed assets

(17,471)


(7,605)

 Purchases of routes

(622)


-

 Proceeds from sale of fixed assets

521


61

 Proceeds from sale of routes

676


-

 Proceeds from sale of investments

960


-

Net cash used in investing activities

(15,936)


(7,544)





Financing activities




Dividends paid to stockholders

(10,584)


(5,134)

Dividends paid to noncontrolling interests

(182)


-

 Issuances of common stock

1,935


748

 Repurchases of common stock

-


(1,261)

 Net (repayments)/proceeds on existing credit facilities

(9,243)


15,000

Net cash (used in)/provided by financing activities

(18,074)


9,353





Effect of exchange rate changes on cash

83


133





(Decrease)/increase in cash and cash equivalents

(21,515)


408

Cash and cash equivalents at beginning of period

27,877


5,418

Cash and cash equivalents at end of period

$   6,362


$   5,826





Supplemental information:




Cash paid for income taxes, net of refunds of $2 and $12, respectively

$  449


$  842

Cash paid for interest

$   1,478


$   831


*Quarter Ended March 27, 2010 amounts have been revised to reflect the change in accounting for inventory.



SNYDER'S-LANCE, INC. AND SUBSIDIARIES


Reconciliation of Non-GAAP Measures

(in thousands, except per share data)

(unaudited)





Net of

Tax


Per Diluted

Share

Quarter Ended April 2, 2011




Net income attributable to Snyder's-Lance, Inc.

$  10,849


$  0.16





  Merger-related costs

981


0.01





Net income attributable to Snyder's-Lance, Inc., excluding special items

$  11,830


$  0.17





Quarter Ended March 27, 2010




Net loss reported by Lance, Inc.

$  (685)


$  (0.02)





Merger and acquisition activity

1,930


0.06





Net income reported by Lance, Inc., excluding special items

$  1,245


$  0.04








SOURCE Snyder's-Lance, Inc.

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