ConAgra Foods, Inc., (NYSE: CAG) one of North America’s leading
food companies, today reported results for the fiscal 2010 fourth
quarter ended May 30, 2010. Diluted EPS from continuing operations
was $0.27 compared with $0.38 a year ago. After adjusting for net
$0.12 in the current quarter and net $0.03 in the year-ago period
from items impacting comparability, current-quarter diluted EPS was
$0.39, down from $0.41 for the same period a year ago. The decline
was expected, principally due to the extra week in the year-ago
period and challenges for the Lamb Weston operations. Items
impacting comparability in the current year and prior year are
summarized toward the end of this release.
Gary Rodkin, ConAgra Foods’ chief executive officer, commented,
“We are pleased with our fiscal year, posting comparable diluted
EPS of $1.74 and generating very strong operating cash flow of $1.4
billion. We grew year-over-year unit and dollar market share in our
Consumer Foods segment, reflecting successful sales, innovation,
and marketing initiatives. This top-line progress, coupled with
cost savings initiatives, allowed us to generate strong earnings,
invest for the future, and more than offset challenges affecting
our Commercial Foods segment. We are confident that fiscal 2011
will continue to demonstrate our company’s earnings power and
ability to generate strong cash flows.”
Consumer Foods Segment (66% of
Fiscal 2010 sales)Branded and non-branded food sold in retail
and foodservice channels.
The Consumer Foods segment posted sales of $2,029 million and
operating profit of $226 million for the quarter. Sales declined 4%
as reported but increased 3% on a comparable 13-week basis. Unit
volumes increased 3% on a comparable 13-week basis. Foreign
exchange favorably impacted sales growth by 1%.
- On a comparable 13-week basis,
large brands that posted sales growth in the current quarter
include Banquet, Chef Boyardee, DAVID, Healthy Choice, Hunt’s, PAM,
Peter Pan, Rosarita, Slim Jim, Snack Pack, and others.
- Sales growth reflects the
ongoing benefit of innovation, particularly in the frozen foods
operations, as well as high-impact marketing investments over the
last several quarters and strengthening customer
relationships.
- More brand details can be found
in the Q&A document accompanying this release.
Operating profit of $226 million was 15% below year-ago amounts
as reported. Current-quarter amounts include $69 million of net
expense from items impacting comparability; excluding those
amounts, current-quarter operating profit was $295 million, up 10%
from year-ago amounts. The comparable year-over-year profit
improvement primarily reflects strong cost savings efficiencies
that more than offset modest input cost inflation. See page 11 for
a Regulation G reconciliation of Consumer Foods segment sales and
operating profit amounts, which detail the items impacting
comparability for those measurements.
Given progress with initiatives involving operating
efficiencies, innovation, marketing, and customer service, the
company is confident in the strength of the foundation of this
segment as it plans for profitable future growth.
Commercial Foods Segment (34% of
Fiscal 2010 sales)Specialty potato, seasonings, blends,
flavors, and milled grain productssold to foodservice and
commercial channels worldwide.
Fiscal fourth quarter sales for the Commercial Foods segment
were $1,033 million, 6% below last year’s $1,103 million,
reflecting the impact of an extra week last year as well as lower
flour milling sales in the current quarter due to the pass-through
impact of lower underlying wheat costs. Segment operating profit
was $111 million, 26% below last year’s $151 million. The profit
decline reflects the extra week last year and unfavorable product
costs at Lamb Weston resulting from a poor-quality potato crop.
Lamb Weston’s weaker profit performance also reflects the impact of
a cost allocation process change as previously communicated, which
benefited earlier fiscal quarters this year but which negatively
impacted the current quarter. Although below last year’s
outstanding results, flour milling profits remained very strong
from a tight focus on product mix, operating efficiencies, and
capitalizing on market opportunities.
As discussed in the company’s press release dated June 7, 2010,
the company has entered into an agreement to divest its Gilroy
Foods & Flavors dehydrated vegetable operations. The results of
those operations have been reclassified from the Commercial Foods
segment to discontinued operations for all periods presented.
Hedging Activities – Beginning in fiscal 2009, the
company began to reflect realized and unrealized gains and losses
from derivatives (except for those related to the milling
operations) used to hedge anticipated commodity consumption in
earnings immediately within general corporate expenses. The gains
and losses are reclassified from Corporate expense to segment
operating results in the period in which the underlying item being
economically hedged is recognized in cost of goods sold.
The company recorded an immaterial net hedging benefit in
unallocated Corporate expense in the current quarter, and $38
million of net hedging benefit in unallocated Corporate expense in
the year-ago period. The company identifies the $38 million in
prior-year amounts as an item impacting comparability. Hedge
amounts are reclassified from unallocated Corporate expense to the
operating segments when the underlying commodity being hedged is
recognized in segment cost of goods sold.
Other Items
- Corporate expense was $124
million for the quarter and $116 million in the year-ago period.
Current-quarter amounts include approximately $14 million of
transaction-related costs associated with securing federal tax
benefits related to the Delhi, La. sweet potato project. These
benefits will be recognized by the company in future years. Current
quarter amounts also include approximately $4 million of expense
related to restructuring activities. Prior-year amounts include net
$12 million of unallocated expense related to commodity hedging and
debt retirement charges. Excluding these amounts, current-quarter
Corporate expense was $106 million, compared with $104 million for
the same period a year ago.
- Equity method investment
earnings were $4 million, down from $10 million in the year-ago
period. The decline reflects continued difficult market conditions
for an international potato joint venture.
- Net interest expense was $39
million in the current quarter, lower than $51 million in the
year-ago period largely due to the extra week a year-ago. Interest
income from the notes receivable held in connection with the
divestiture of the Trading & Merchandising operations benefited
the current quarter and the year-ago period by approximately $22
million and $21 million, respectively.
- The effective tax rate for
continuing operations for the quarter was approximately 32%, which
was lower than planned due to favorable changes in estimates and
settlements, offset in part by unfavorable tax consequences
resulting from recently enacted healthcare legislation. The net
benefit from this lower rate is cited as an item impacting
comparability.
Discontinued Operations
Diluted EPS from discontinued operations was a loss of $0.07 for
the quarter. Included in discontinued operations for the quarter
are results for the dehydrated vegetable operations, reclassified
from the Commercial Foods segment due to their pending sale.
- There was approximately $0.01 of
diluted EPS contribution from operating activities for the
dehydrated vegetable operations; this contribution was part of the
company’s annual EPS guidance.
- The company recognized a
pre-tax, non-cash impairment charge of approximately $60 million,
or $0.09 loss per share, representing a write-down of the carrying
value of the assets to fair value based on the anticipated proceeds
from the sale.
Capital Items
During the quarter, the company’s transaction activities
included:
- Acquiring Elan Nutrition, a
formulator and producer of private label snack and nutrition bars,
for approximately $105 million in cash; this transaction was
completed during the fourth quarter of fiscal 2010.
- Announcing an agreement to
acquire American Pie, LLC, the manufacturer of Marie Callender’s
branded frozen pies and fruit cobblers and Claim Jumper branded
frozen items; the purchase price is expected to be $130 million in
cash; this transaction is expected to close in the first quarter of
fiscal 2011, subject to customary closing conditions.
- Announcing an agreement to sell
the dehydrated vegetable operations of Gilroy Foods & Flavors,
formerly in the Commercial Foods segment, to Olam International for
approximately $250 million in cash; this transaction is expected to
close in the first quarter of fiscal 2011, subject to customary
closing conditions.
- During the quarter, ConAgra
Foods received $115 million as payment in full of all principal and
interest due on the first tranche of notes from Gavilon, LLC, in
advance of the scheduled June 19, 2010 maturity date. The notes
were received in connection with the divestiture of the company’s
Trading & Merchandising operations in fiscal 2009.
- During the quarter, the company
repurchased approximately 4 million shares of common stock. The
company has $400 million remaining under the $500 million share
repurchase authorization communicated earlier this year.
- Dividends for the quarter
totaled $89 million versus $85 million in the year-ago period,
reflecting a dividend increase earlier in fiscal 2010.
- For the quarter, capital
expenditures for property, plant, and equipment were $123 million,
compared with $117 million in the year-ago period. Depreciation and
amortization expense from continuing operations was approximately
$86 million for the quarter; this compares with a total of $79
million in the year-ago period.
- During the quarter, the company
made a voluntary $100 million contribution to its pension
plans.
Fiscal 2011
Consistent with its long-term EPS goals, the company expects
fiscal 2011 diluted EPS, adjusted for items impacting
comparability, to reflect 8-10% growth from its fiscal 2010 diluted
comparable EPS of $1.74. The company expects the EPS growth to be
concentrated in the second half of the fiscal year. This timing
largely reflects:
- the raw-material-related cost
issues at Lamb Weston, which are expected to improve with the new
potato crop, and
- the difficult comparison created
by unusually strong net cost savings in the Consumer Foods segment
in the first half of fiscal 2010.
The company also expects cash flow from operations to be
approximately $1.2 billion in fiscal 2011.
See page 11 for a Regulation G reconciliation of full year
diluted EPS from continuing operations.
Comparable EPS Amounts
Diluted EPS from continuing operations for the fourth quarter of
fiscal 2010 was $0.27. The comparable EPS amount of $0.39 is
determined by adjusting the $0.27 by the following items (EPS
amounts rounded and after tax):
- Approximately $0.05 per diluted
share of restructuring expense resulting primarily from the
company’s decision to move manufacturing activities in Garner, N.C.
to Troy, Ohio, as well as the company’s decision to move
administrative functions in Edina, Minn. to Naperville, Ill. These
pretax costs of $39 million are classified as $3 million of cost of
goods sold and $32 million of selling, general, and administrative
expense (SG&A) within the Consumer Foods segment, and $4
million of SG&A costs classified within unallocated Corporate
expense.
- Approximately $0.05 per diluted
share of impairment charges in the Consumer Foods segment resulting
from an updated assessment of manufacturing strategies and the
related impact on an existing facility. The $33 million of pretax
impairment charge is classified as SG&A expense.
- Approximately $0.02 per diluted
share of expense, or $14 million of pretax transaction-related
costs associated with securing federal tax benefits related to the
Delhi, La. sweet potato project.
- Approximately $0.01 per diluted
share of net income tax benefits resulting in a lower-than-planned
effective income tax rate.
- $0.01 of diluted EPS was
reclassified from the Commercial Foods segment to discontinued
operations during the quarter due to the pending divestiture of the
dehydrated vegetable operations; these earnings were part of the
company’s EPS plans for the year, and the company has included this
$0.01 as part of comparable diluted EPS when evaluating progress
toward its stated diluted EPS goals.
Diluted EPS from continuing operations for the fourth quarter of
fiscal 2009 was $0.38*. The comparable EPS amount of $0.41 is
determined by adjusting the $0.38 by the following items (EPS
amounts rounded and after tax):
- Approximately $0.07 per diluted
share of expense related to early retirement of debt; this is
classified as $50 million of (pre-tax) unallocated Corporate
expense.
- Approximately $0.05 per diluted
share of net benefit to unallocated Corporate expense resulting
from:
- Reclassifying $29 million of net
losses on derivatives from unallocated Corporate expense to the
operating segments, and
- Generating an additional $9
million of net gains on derivatives used to hedge commodity input
costs. This gain was reclassified to the operating segments at a
later date when underlying items were recognized in segment
results.
- $0.01 of diluted EPS previously
in continuing operations was reclassified to discontinued
operations based on divestiture plans for the dehydrated vegetable
operations announced June 7, 2010. This topic is discussed above
and in the 8-K filed with the SEC on June 7, 2010.
*The company estimates a benefit of approximately $0.03 per
diluted share due to the extra week in the fourth quarter of fiscal
2009, which enabled additional marketing and innovation
investments.
See Page 11 for a Regulation G reconciliation of diluted EPS
from continuing operations.
Discussion of Results
ConAgra Foods will host a conference call at 9:30 a.m. EDT today
to discuss the results. Following the company’s remarks, the call
will include a question-and-answer session with the investment
community. Domestic and international participants may access the
conference call toll-free by dialing 1-888-668-1640 and
1-913-312-0971, respectively. No confirmation or pass code is
needed. This conference call also can be accessed live on the
Internet at http://investor.conagrafoods.com.
A rebroadcast of the conference call will be available after 1
p.m. EDT today. To access the digital replay, a pass code number
will be required. Domestic participants should dial 1-888-203-1112,
and international participants should dial 1-719-457-0820 and enter
pass code 4764133. A rebroadcast also will be available on the
company’s Web site.
In addition, the company has posted a question-and-answer
supplement relating to this release at
http://investor.conagrafoods.com. To view recent company news,
please visit http://media.conagrafoods.com.
ConAgra Foods, Inc., (NYSE: CAG) is one of North America’s
leading food companies, with brands in 96 percent of America’s
households. Consumers find Banquet, Chef Boyardee, Egg Beaters,
Healthy Choice, Hebrew National, Hunt’s, Marie Callender’s, Orville
Redenbacher’s, PAM, Peter Pan, Reddi-wip and many ConAgra Foods
brands in grocery, convenience, mass merchandise and club stores.
ConAgra Foods also has a strong business-to-business presence,
supplying frozen potato and sweet potato products as well as other
vegetable, spice and grain products to a variety of well-known
restaurants, foodservice operators and commercial customers. For
more information, please visit us at www.conagrafoods.com.
Note on Forward-looking Statements
This release contains forward-looking statements. These
statements are based on management's current views and assumptions
of future events and financial performance and are subject to
uncertainty and changes in circumstances. The company undertakes no
responsibility for updating these statements. Readers of this
release should understand that these statements are not guarantees
of performance or results. Many factors could affect the company's
actual financial results and cause them to vary materially from the
expectations contained in the forward-looking statements. These
factors include, among other things: availability and prices of raw
materials; the impact of the accident at the Garner, N.C.,
manufacturing facility, including the ultimate costs incurred and
the amounts received under insurance policies; product pricing;
future economic circumstances; industry conditions; the company's
ability to execute its operating plans; the success of the
company's innovation, marketing, and cost-saving initiatives; the
competitive environment and related market conditions; operating
efficiencies; the ultimate impact of the company's recalls; access
to capital; actions of governments and regulatory factors affecting
the company's businesses, including the Patient Protection and
Affordable Care Act; the amount and timing of repurchases of the
company's common stock, if any; the ability to successfully
complete the sale of the Gilroy Foods & Flavors dehydrated and
vegetable products business and the acquisition of American Pie,
LLC; an increase or decrease in the expected impairment charge
required in connection with the sale of the Gilroy Foods &
Flavors dehydrated and vegetable products business; and other risks
described in the company's reports filed with the Securities and
Exchange Commission. The company cautions readers not to place
undue reliance on any forward-looking statements included in this
release, which speak only as of the date made.
Regulation G Disclosure Below is
a reconciliation of diluted earnings per share adjusted for items
impacting comparability.
Q4 FY10 & Q4 FY09 Diluted
EPS - Reconciliation for Regulation G Purposes Q4 FY10
Q4 FY09 Diluted EPS from continuing operations
$ 0.27 $ 0.38 Items impacting
comparability: Diluted EPS from Gilroy Foods & Flavors
operations, reclassified to discontinued operations in Q4 FY10, but
part of the company's FY10 EPS guidance 0.01 0.01 Expense related
to impairment charge on an existing facility 0.05 - Expense related
to Garner, N.C., and Edina, Minn. restructuring charges 0.05 -
Expense related to tax credit transaction related to Delhi, La.
sweet potato facility 0.02 - Expense related to early retirement of
debt - 0.07 (Benefit) related to unallocated mark-to-market impact
of derivatives - (0.05 ) (Benefit) of lower-than-planned effective
income tax rate (0.01 ) -
Diluted EPS
adjusted for items impacting comparability $ 0.39
$ 0.41 FY10 EPS -
Reconciliation for Regulation G Purposes Total FY10
Diluted EPS from continuing operations $ 1.67
Items impacting comparability: Expense related to
unallocated mark-to-market impact of derivatives (Q1) 0.01
(Benefit) related to unallocated mark-to-market impact of
derivatives (Q2) (0.01 ) (Benefit) related to gain on sale of
Luck's brand (Q3) (0.02 ) (Benefit) related to environmental
liability estimates (Q3) (0.02 ) (Benefit) of lower-than-planned
effective income tax rate (Q2, Q3, Q4) (0.05 ) Diluted EPS from
Gilroy Foods & Flavors operations, reclassified to discontinued
operations in Q4 FY10, but part of the company's FY10 EPS guidance
(Q4) 0.04 Expense related to Garner, N.C., and Edina, Minn.
restructuring charges (Q3, Q4) 0.06 Expense related to impairment
charge on an existing facility (Q4) 0.05 Expense related to tax
credit transaction related to Delhi, La. sweet potato facility (Q4)
0.02 Rounding included in above items (0.01 )
Diluted EPS
adjusted for items impacting comparability $ 1.74
Consumer Foods Segment Below is a
reconciliation of segment operating profit exclusive of items
impacting comparability.
Consumer Foods Segment Operating
Profit Reconciliation (impacted by rounding) (Dollars in
millions)
Q4 FY10 Q4 FY09
Year-over-year%
change
Consumer Foods Segment Operating Profit $ 226
$ 268 -15% Impairment charge related to an
existing facility 33 - Restructuring charges related to Garner,
N.C., and Edina, Minn. 36 -
Consumer Foods Segment Adjusted Operating Profit $
295 $ 268 10%
Consumer Foods Segment Sales
Our calculation of Consumer Foods
fourth quarter sales, adjusted for the impact of the extra week in
the prior year's fourth quarter, estimates a 7% benefit from the
extra week of sales in the year-ago period.
ConAgra Foods, Inc.
Segment Operating Results (in millions) FOURTH QUARTER 13
Weeks Ended 14 Weeks Ended
May 30, 2010
May 31, 2009 Percent Change
SALES
Consumer Foods $ 2,029.3 $ 2,121.5 (4.3)% Commercial Foods
1,033.2 1,102.8 (6.3)% Total 3,062.5
3,224.3 (5.0)%
OPERATING PROFIT
Consumer Foods $ 226.4 $ 267.5 (15.4)% Commercial Foods
111.4 151.2 (26.3)% Total operating profit for
segments 337.8 418.7 (19.3)%
Reconciliation of total
operating profit to income fromcontinuing operations before
income taxes and equitymethod investment earnings
Items excluded from segment operating profit: General corporate
expense (123.8 ) (116.4 ) 6.4% Interest expense, net (38.8 )
(51.3 ) (24.4)%
Income from continuing operations
before income taxesand equity method investment earnings
$ 175.2 $ 251.0 (30.2)%
Segment operating profit excludes general
corporate expense, equity method investment earnings, and net
interest expense. Management believes such amounts are not directly
associated with segment performance results for the period.
Management believes the presentation of total operating profit for
segments facilitates period-to-period comparison of results of
segment operations.
ConAgra Foods, Inc. Segment Operating
Results (in millions) YEAR-TO-DATE 52 Weeks Ended 53 Weeks
Ended
May 30, 2010
May 31, 2009 Percent Change
SALES
Consumer Foods $ 8,001.9 $ 7,978.6 0.3% Commercial Foods
4,077.5 4,447.5 (8.3)% Total 12,079.4
12,426.1 (2.8)%
OPERATING PROFIT
Consumer Foods $ 1,112.6 $ 949.4 17.2% Commercial Foods
539.0 542.6 (0.7)% Total operating profit for
segments 1,651.6 1,492.0 10.7%
Reconciliation of total
operating profit to income fromcontinuing operations before
income taxes and equitymethod investment earnings
Items excluded from segment operating profit: General corporate
expense (406.4 ) (393.6 ) 3.3% Interest expense, net (160.4
) (186.0 ) (13.8)%
Income from continuing operations
before income taxesand equity method investment earnings
$ 1,084.8 $ 912.4 18.9%
Segment operating profit excludes general
corporate expense, equity method investment earnings, and net
interest expense. Management believes such amounts are not directly
associated with segment performance results for the period.
Management believes the presentation of total operating profit for
segments facilitates period-to-period comparison of results of
segment operations.
ConAgra Foods, Inc.
Consolidated Statements of
Earnings
(in millions, except per share amounts) FOURTH
QUARTER 13 Weeks Ended 14 Weeks Ended
May 30, 2010
May 31, 2009
PercentChange
Net sales $ 3,062.5
$
3,224.3
(5.0)% Costs and expenses: Cost of goods sold 2,324.7
2,413.2
(3.7)% Selling, general and administrative expenses 523.8
508.8
2.9% Interest expense, net 38.8
51.3
(24.4)%
Income from continuing operations
before income taxesand equity method investment earnings
175.2
251.0
(30.2)% Income tax expense 56.6
91.0
(37.8)% Equity method investment earnings 4.4
10.1
(56.4)% Income from continuing operations 123.0
170.1
(27.7)% Income (loss) from discontinued operations, net of
tax (32.8 )
4.8
N/A Net income $ 90.2 $
174.9
(48.4)%
Less: Net income (loss)
attributable to noncontrolling interests
(0.4 )
0.2
N/A Net income attributable to ConAgra Foods, Inc. $ 90.6 $
174.7
(48.1)% Earnings per share – basic Income from
continuing operations $ 0.28 $
0.38
(26.3)% Income (loss) from discontinued operations (0.08 )
0.01
N/A Net income $ 0.20 $
0.39
(48.7)% Weighted average shares outstanding 444.0
445.8
(0.4)% Earnings per share – diluted Income from
continuing operations $ 0.27 $
0.38
(28.9)% Income (loss) from discontinued operations (0.07 )
0.01
N/A Net income $ 0.20 $
0.39
(48.7)% Weighted average share and share equivalents
outstanding
449.4
448.6
0.2% ConAgra Foods, Inc.
Consolidated Statements of
Earnings
(in millions, except per share amounts)
YEAR-TO-DATE 52 Weeks Ended 53 Weeks Ended
May 30, 2010
May 31, 2009
PercentChange
Net sales $ 12,079.4 $
12,426.1
(2.8)% Costs and expenses: Cost of goods sold 9,014.2
9,644.1
(6.5)% Selling, general and administrative expenses 1,820.0
1,683.6
8.1% Interest expense, net 160.4
186.0
(13.8)%
Income from continuing operations
before income taxesand equity method investment earnings
1,084.8
912.4
18.9% Income tax expense 362.1
318.6
13.7% Equity method investment earnings 22.1
24.0
(7.9)% Income from continuing operations 744.8
617.8
20.6% Income (loss) from discontinued operations, net of tax
(21.5 )
361.2
N/A Net income $ 723.3 $
979.0
(26.1)% Less: Net income (loss) attributable to noncontrolling
interests (2.5 )
0.6
N/A Net income attributable to ConAgra Foods, Inc. $ 725.8 $
978.4
(25.8)% Earnings per share – basic Income from
continuing operations $ 1.68 $
1.36
23.5% Income (loss) from discontinued operations (0.05 )
0.80
N/A Net income $ 1.63 $
2.16
(24.5)% Weighted average shares outstanding 443.6
452.9
(2.1)% Earnings per share – diluted Income from
continuing operations $ 1.67 $
1.36
22.8% Income (loss) from discontinued operations (0.05 )
0.79
N/A Net income $ 1.62 $
2.15
(24.7)% Weighted average share and share equivalents
outstanding
447.1
455.4
(1.8)% ConAgra Foods, Inc. Consolidated
Balance Sheets (in millions)
May 30, 2010
May 31, 2009
ASSETS Current assets Cash and cash equivalents
$ 953.2 $ 243.2 Receivables, less allowance for doubtful accounts
of $8.5 and $13.8 849.6 755.3 Inventories 1,606.5 1,821.7 Prepaid
expenses and other current assets 307.3 269.5 Current assets held
for sale 243.5 246.9 Total
current assets (3,960.1 ) (3,336.6 ) Property, plant and
equipment, net 2,625.0 2,559.2 Goodwill 3,552.1 3,483.6 Brands,
trademarks and other intangibles, net 874.8 834.9 Other assets
695.6 768.1 Noncurrent assets held for sale 30.4
90.9 $ 11,738.0 $
11,073.3
LIABILITIES AND STOCKHOLDERS' EQUITY Current
liabilities Notes payable $ 0.6 $ 3.7 Current installments of
long-term debt 260.2 23.9 Accounts payable 919.1 809.1 Accrued
payroll 263.9 165.9 Other accrued liabilities 579.0 551.3 Current
liabilities held for sale 13.4 20.2
Total current liabilities 2,036.2 1,574.1 Senior
long-term debt, excluding current installments 3,030.5 3,259.5
Subordinated debt 195.9 195.9 Other noncurrent liabilities 1,541.3
1,317.0 Noncurrent liabilities held for sale 5.2 5.9 Common
stockholders' equity 4,928.9 4,720.9
$ 11,738.0 $ 11,073.3
ConAgra Foods, Inc.
Consolidated Statements of Cash
Flows
(in millions)
52 Weeks Ended
53 Weeks Ended
May 30, 2010
May 31, 2009
Cash flows from operating activities: Net income $ 723.3 $ 979.0
Income from discontinued operations
(21.5 )
361.2 Income from continuing operations 744.8
617.8 Adjustments to reconcile income from continuing operations to
net cash flows from operating activities: Depreciation and
amortization 326.8 307.6 Loss on sale of fixed assets 1.6 2.5 Gain
on sale of businesses (14.3 ) (19.7 ) Fixed asset impairment
charges 64.8 5.3 Impairment charges related to Garner accident 31.5
— Insurance recoveries related to Garner accident (58.1 ) —
Advances from insurance carriers related to Garner accident 50.2 —
Distributions from affiliates greater than current earnings 8.5
17.4 Share-based payments expense 55.8 45.9 Loss on retirement of
debt — 49.2 Non-cash interest income on payment-in-kind notes (67.9
) (43.0 ) Contributions to Company pension plans (122.6 ) (112.0 )
Other items 94.2 8.6 Change in operating assets and liabilities
before effects of business acquisitions and dispositions: Accounts
receivable (85.6 ) 73.1 Inventories 202.3 (44.2 ) Prepaid expenses
and other current assets (20.0 ) 170.8 Accounts payable 73.8 17.7
Accrued payroll 97.1 (61.4 ) Other accrued liabilities
59.9 (49.0 ) Net cash flows from
operating activities—continuing operations 1,442.8 986.6 Net cash
flows from operating activities—discontinued operations
29.9 (862.6 ) Net cash flows from
operating activities
1,472.7
124.0
Cash flows from investing activities: Additions to property, plant
and equipment (482.9 ) (429.6 ) Advances from insurance carriers
related to Garner accident 34.8 — Sale of businesses 21.7 29.7 Sale
of property, plant and equipment 88.4 17.7 Purchase of businesses
and intangible assets (106.5 ) (80.3 ) Proceeds from collection of
payment-in-kind note 91.9 — Other items
—
1.9 Net cash flows from investing
activities—continuing operations (352.6 ) (460.6 ) Net cash flows
from investing activities—discontinued operations
(2.7 ) 2,251.8 Net
cash flows from investing activities
(355.3
) 1,791.2
ConAgra Foods, Inc.
Consolidated Statements of Cash
Flows
(in millions)
52 Weeks Ended
53 Weeks Ended
May 30, 2010
May 31, 2009
Cash flows from financing activities: Net short-term borrowings —
(578.3 ) Issuance of long-term debt — 990.1 Issuance of long-term
debt by variable interest entity, net of repayments — 40.0
Repayment of long-term debt (15.8 ) (1,015.7 ) Repurchase of
ConAgra Foods common shares (100.0 ) (900.0 ) Cash dividends paid
(346.7 ) (348.2 ) Return of cash to minority interest holder —
(20.0 ) Exercise of stock options and issuance of other stock
awards 54.7 6.1 Other items
3.9
(1.1 ) Net cash flows from financing
activities—continuing operations (403.9 ) (1,827.1 ) Net cash flows
from financing activities—discontinued operations
(0.6 ) 0.1 Net cash
flows from financing activities
(404.5
) (1,827.0 )
Effect of exchange rate changes on cash and cash equivalents (2.9 )
(16.7 ) Net change in cash and cash equivalents 710.0 71.5
Discontinued operations cash activity included above: Add: Cash
balance included in assets held for sale at beginning of year —
30.8 Less: Cash balance included in assets held for sale at end of
year — — Cash and cash equivalents at beginning of year
243.2 140.9 Cash and cash
equivalents at end of year
$ 953.2
$ 243.2
ConAgra Brands (NYSE:CAG)
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