ConAgra Foods, Inc., (NYSE: CAG):
Highlights:
- Diluted EPS from continuing
operations of $0.45 as reported and adjusted for items impacting
comparability; down 15% as reported and down 12% on a comparable
basis.
- Consumer Foods’ unit volumes and
unit market share increased, but profits declined reflecting
difficult market conditions, weaker-than-planned response to
promotions, and inflation that outpaced cost savings.
- Pricing and merchandising actions
currently under way, strong productivity, lower SG&A, and
accelerating contribution from innovation and recently acquired
businesses are expected to improve the Consumer Foods segment’s
results.
- Commercial Foods’ sales increased.
Operating profits declined, reflecting the margin impact of selling
and processing last year’s high-cost, unusually poor-quality potato
crop. The new, good-quality crop currently being processed
positions the segment for improvement.
- Fiscal 2011 diluted EPS adjusted for
items impacting comparability expected to grow at a
low-single-digit rate over comparable fiscal 2010 EPS (Fiscal 2010
EPS: $1.67 as reported, $1.74 comparable base).
- As previously disclosed, after
quarter-end, the company received $554 million in cash from
repayment of notes receivable related to a divestiture in 2008. The
Board of Directors increased the company’s share repurchase
authorization by this amount.
ConAgra Foods, Inc., (NYSE: CAG) one of North America’s leading
packaged food companies, today reported results for the fiscal 2011
second quarter ended November 28, 2010. Diluted EPS from continuing
operations was $0.45 as reported and on a comparable basis. For the
same period a year ago, diluted EPS from continuing operations as
reported was $0.53, which included $0.02 of net benefit from items
impacting comparability. 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, said,
“Several challenges impacted our results. Difficult market
conditions, weaker-than-planned consumer response to promotions,
and higher-than-planned inflation weighed on Consumer Foods’
profits despite progress in overall unit market shares and volume.
Profitability of our Commercial Foods segment was below
expectations primarily due to selling and processing last year’s
high-cost, unusually low-quality potato crop. In aggregate, it was
a challenging quarter.”
He continued, “Several factors are expected to improve
year-over-year operating results in the second half of the fiscal
year, despite the challenging environment. Very importantly, we are
increasing net pricing on a number of our products given the
ongoing acceleration of cost inflation. Some price increases have
recently been implemented, and more are under way. We are confident
that the net effect of these pricing increases will be positive,
despite some potential modest volume decline. Our products will
continue to deliver outstanding value to consumers even after these
pricing actions. Price increases, along with strong cost savings,
lower SG&A, accelerating contribution from innovation and
recently acquired businesses, and a good-quality potato crop
currently being processed are expected to drive improved
year-over-year earnings for the rest of the fiscal year. Although
the challenging environment is expected to cause this fiscal year’s
anticipated EPS growth to be comparatively modest, the operating
foundation of the company continues to be strong, and we are
confident in our long-term EPS growth potential.”
Consumer Foods Segment (67% of
second-quarter sales)
Branded and non-branded food sold in retail and
foodservice channels.
The Consumer Foods segment posted sales of $2,104 million and
operating profit of $284 million for the second quarter. Sales
increased 1% as reported, reflecting a 1% organic volume increase,
3% decline in overall price/mix, and 3% benefit from acquisitions
(net of divestitures). The company’s all-outlet unit market share
increased for the quarter, while dollar share was largely unchanged
in aggregate.
Sales results reflect difficult market conditions and a very
competitive environment, which necessitated increased promotional
spending. Consumer response to promotions was weaker-than-planned
given the challenging economic conditions. The company noted strong
sales results for the segment’s frozen business and international
markets. Sales for recently acquired and recently introduced
products performed well.
- Brands posting sales growth for the
quarter included DAVID, Marie Callender’s, PAM, Reddi-wip, Slim
Jim, Wesson, Wolf, and others.
- More brand details can be found in the
Q&A document accompanying this release.
- Based on accelerating input cost
inflation, the company is in the process of implementing pricing
increases; despite some potential negative effect on volumes, the
company expects the net impact of the pricing increases to improve
fiscal 2011 second-half profitability.
Operating profit of $284 million was 14% below $330 million in
the year-ago period, as reported. Adjusting for approximately $5
million of restructuring charges in current-quarter results, the
comparable year-over-year decline was 13%. The lower profitability
reflects the impact of unfavorable price/mix, largely due to
promotional spending, as well as inflation that outpaced cost
savings. Cost savings during the quarter were in line with
expectations, at approximately $80 million, and the company expects
to deliver in excess of $275 million of cost savings this fiscal
year, with strong savings in the second half.
The company expects the segment’s year-over-year profit
performance to improve in the second half of the fiscal year given
the price increases under way, strong cost savings, lower SG&A,
and accelerating contribution from innovation and recently acquired
businesses.
Commercial Foods Segment (33% of
second-quarter sales)
Specialty potato, milled grain products, and
seasonings, blends, flavors sold to foodservice and commercial
channels worldwide.
Sales for the Commercial Foods segment were $1,057 million, 3%
above $1,022 million in the year-ago period. The sales increase
reflects improved volumes for Lamb Weston specialty potato
products, as well as higher selling prices for the flour milling
operations necessitated by higher wheat input costs.
Segment operating profit was $126 million, 16% below $151
million in the year-ago period. The operating profit decline
reflects weaker margins at Lamb Weston, primarily due to selling
and processing last year’s high-cost, unusually poor-quality potato
crop. The company also incurred start up costs at the new Delhi,
La., sweet potato plant, which began operations during the quarter.
The company finished its inventory of the old potato crop, and
began processing this year’s new, good-quality potato crop this
quarter; fiscal second-half profits for the Lamb Weston specialty
potato operations are on track for year-over-year improvement.
Although still strong, flour milling profits were down from last
year’s high levels, as expected. Profits for the seasonings,
blends, and flavors operations were in line with year-ago amounts,
as planned.
Hedging Activities – This language primarily relates to
operations other than the company’s milling operations.
The company recorded $9 million of net hedging benefit within
unallocated Corporate expense in the current quarter, and $6
million of net hedging benefit within unallocated Corporate expense
in the year-ago period. The company identifies both of these
amounts as items impacting comparability. Those amounts are
reclassified from unallocated Corporate expense to the operating
segments when the underlying commodity or foreign currency being
hedged is expensed in segment cost of goods sold.
Other Items
- Corporate expense was $79 million for
the quarter and $94 million in the year-ago period. Current-quarter
amounts include $9 million due to hedge benefit, and prior-year
amounts include $6 million of hedge benefit. Excluding these
amounts, Corporate expense was $88 million for the current quarter
and $100 million in the year-ago period; the decrease reflects
lower incentive compensation expense. The company has maintained a
strong focus on overhead cost control. Incentive compensation
expense is expected to be lower year-over-year, which will
favorably impact EPS growth.
- Equity method investment earnings were
$5 million in the current quarter and $6 million in the year-ago
period.
- Net interest expense was $34 million in
the current quarter, compared with $41 million in the year-ago
period; 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
$19 million and $20 million, respectively. The year-over-year
decline reflects the repayment of debt earlier this fiscal year,
and the benefit of interest rate swaps.
- The effective tax rate for continuing
operations for the quarter was approximately 34%. The company
continues to expect the continuing operations effective tax rate
for the full fiscal year 2011 to be approximately 34%, adjusted for
items impacting comparability.
Capital Items
- After quarter end, the company received
$554 million in cash as payment in full of the principal and
interest due on the two outstanding tranches of notes receivable
related to the divestiture of the Trading & Merchandising
operations in June 2008. The two tranches of notes had been
scheduled to mature in June 2011 and June 2012.
- The Board of Directors increased the
company’s share repurchase authorization by the amount of the early
payment, $554 million.
- Reflecting approximately $100 million
of shares repurchased during the second quarter and the recent $554
million authorization increase, the remaining share repurchase
authorization is approximately $750 million. The company plans to
complete its share repurchase program over the next several
quarters, subject to market conditions. Repurchases may be
completed through negotiated transactions or open market
purchases.
- Given the expected timing of share
repurchases, the EPS benefit of the share repurchases is not
expected to totally offset the impact of foregone interest income
in the second half of the fiscal year. The company therefore
expects to have a negative impact of $0.03-$0.04 to EPS in the
second half of fiscal 2011 due to these matters. The company does
not expect any significant EPS impact in fiscal 2012 related to
these capital allocation events.
- Dividends for the quarter totaled $88
million versus $84 million for the year-ago period.
- For the quarter, capital expenditures
from continuing operations for property, plant, and equipment were
$82 million, compared with $123 million in the year-ago period.
Depreciation and amortization expense from continuing operations
was approximately $89 million for the quarter; this compares with a
total of $81 million in the year-ago period.
Outlook for Fiscal 2011
The company expects fiscal 2011 full-year diluted EPS, adjusted
for items impacting comparability, to show a low-single-digit rate
of growth over the comparable $1.74 earned in fiscal 2010. This
outlook reflects weaker-than-planned first-half EPS and the
negative earnings impact related to the early payment of notes
receivable. The company’s expectations for improved operating
results in the second half of the fiscal year are based on pricing
actions under way, strong cost savings, lower SG&A,
accelerating contribution from innovation and recently acquired
businesses, as well as the benefit of a good-quality potato crop
already being processed at Lamb Weston. The company expects
year-over-year EPS improvement in the fiscal 2011 third and fourth
quarters, with EPS amounts being higher in the fourth quarter than
in the third quarter largely due to the timing of price increases.
The company expects operating cash flow to be approximately $1.2
billion for the fiscal year.
Major Items Impacting Second-quarter Fiscal 2011 EPS
Comparability
Included in the $0.45 diluted EPS from continuing operations for
the second quarter of fiscal 2011 (EPS amounts rounded and after
tax):
- Approximately $0.01 per diluted share
of net benefit, or $9 million pretax, related to the mark-to-market
impact of derivatives used to hedge input costs, temporarily
classified in unallocated Corporate expense. This will later be
reclassified to the operating segments when underlying hedged items
are expensed in segment cost of goods sold.
- Approximately $0.01 per diluted share
of expense, or $5 million pretax, related to restructuring plans;
this expense is classified within the Consumer Foods segment ($4
million COGS, $1 million SG&A).
Included in the $0.53 diluted EPS from continuing operations for
the second quarter of fiscal 2010 (EPS amounts rounded and after
tax):
- Approximately $0.02 per diluted share
of net benefit from a lower-than-planned effective income tax
rate.
- Approximately $0.01 per diluted share
of net benefit related to the mark-to-market impact of derivatives
used to hedge input costs, temporarily classified in unallocated
Corporate expense. This expense will later be reclassified to the
operating segments when underlying hedged items are expensed in
segment cost of goods sold.
- NOTE: When reporting second quarter
diluted EPS from continuing operations in fiscal 2010, there was
$0.01 of EPS related to the Gilroy Foods & Flavors dehydrated
vegetable operations within continuing operations. This business
was subsequently divested, and the $0.01 of EPS is now included in
discontinued operations. As a result of this reclassification,
fiscal 2010 second quarter diluted EPS from continuing operations,
excluding items impacting comparability, now rounds to $0.51
instead of the $0.52 as presented in the prior year.
Discussion of Results
ConAgra Foods will host a conference call at 9:30 a.m. EST 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 1-800-967-7141 and
1-719-457-2707, 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. EST 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 8587409. A rebroadcast also will be available on the
company’s website.
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 97 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, Slim Jim, Snack Pack and
many other 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 within the
meaning of the Private Securities Litigation Reform Act of 1995.
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; the
effectiveness of its product pricing, including any price increases
and promotions; 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 amount and timing of repurchases of the company's
common stock, if any; the competitive environment and related
market conditions; operating efficiencies; the ultimate impact of
the company's product recalls; access to capital; actions of
governments and regulatory factors affecting the company's
businesses, including the Patient Protection and Affordable Care
Act; 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 of this release.
Regulation G Disclosure
Below is a reconciliation of diluted earnings per share adjusted
for items impacting comparability.
Q2 FY11 & Q2 FY10
Diluted EPS from Continuing Operations - Reconciliation for
Regulation G Purposes Year-
over-year
Q2 FY11 Q2 FY10
% change
Diluted EPS from continuing operations $ 0.45
$ 0.53 -15 % Items impacting
comparability: Expense related to restructuring charges,
principally Garner, N.C., and Edina, Minn. 0.01 - (Benefit) related
to unallocated mark-to-market impact of derivatives (0.01 ) (0.01 )
(Benefit) of lower-than-planned effective income tax rate - (0.02 )
Rounding - 0.01
Diluted EPS
from continuing operations, excluding items impacting
comparability $ 0.45 $ 0.51
-12 % 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
Diluted EPS adjusted for items impacting
comparability $ 0.45 $ 0.52
-13 % 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)
Year -over-year
(Dollars in millions)
Q2 FY11 Q2 FY10 % change Consumer Foods
Segment Operating Profit $ 284 $
330 -14 % Expense related to restructuring
charges, principally Garner, N.C., and Edina, Minn. 5
-
Consumer Foods Segment Adjusted Operating
Profit $ 289 $ 330
-13 % ConAgra Foods, Inc.
Segment Operating Results (in millions) (unaudited) SECOND QUARTER
13 Weeks Ended 13 Weeks Ended
November 28, 2010
November 29, 2009 Percent Change
SALES
Consumer Foods $ 2,104.2 $ 2,078.1 1.3 % Commercial Foods
1,056.9 1,022.0 3.4 % Total 3,161.1
3,100.1 2.0 %
OPERATING
PROFIT
Consumer Foods $ 283.9 $ 330.0 (14.0 )% Commercial Foods
126.3 151.0 (16.4 )% Total operating profit
for segments 410.2 481.0 (14.7 )%
Reconciliation of total
operating profit to income from continuing operations before income
taxes and equity method investment earnings Items excluded from
segment operating profit: General corporate expense (78.5 ) (94.5 )
(16.9 )% Interest expense, net (33.7 ) (40.5 ) (16.8
)% Income from continuing operations before income taxes and equity
method investment earnings $ 298.0 $ 346.0 (13.9 )%
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. Segment Operating Results (in millions)
(unaudited) SECOND QUARTER 26 Weeks Ended 26
Weeks Ended
November 28, 2010
November 29, 2009 Percent Change
SALES
Consumer Foods $ 3,928.4 $ 3,938.2 (0.2 )% Commercial Foods
2,050.3 2,048.2 0.1 % Total 5,978.7
5,986.4 (0.1 )%
OPERATING
PROFIT
Consumer Foods $ 497.9 $ 579.9 (14.1 )% Commercial Foods
238.1 285.1 (16.5 )% Total operating profit
for segments 736.0 865.0 (14.9 )%
Reconciliation of total
operating profit to income from continuing operations before income
taxes and equity method investment earnings Items excluded from
segment operating profit: General corporate expense (162.5 ) (194.2
) (16.3 )% Interest expense, net (71.0 ) (81.9 )
(13.3 )% Income from continuing operations before income taxes and
equity method investment earnings $ 502.5 $ 588.9
(14.7 )%
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) (unaudited) SECOND
QUARTER 13 Weeks Ended 13 Weeks Ended
November 28, 2010
November 29, 2009
Percent Change
Net sales $ 3,161 .1 $ 3,100 .1 2.0% Costs and expenses: Cost of
goods sold 2,401 .0 2,257 .5 6.4% Selling, general and
administrative expenses 428 .4 456 .1 (6.1)% Interest expense, net
33 .7 40 .5 (16.8)% Income from continuing operations
before income taxes and equity method investment earnings 298 .0
346 .0 (13.9)% Income tax expense 101 .4 114 .1 (11.1)% Equity
method investment earnings 4 .6 5 .9 (22.0)% Income
from continuing operations 201 .2 237 .8 (15.4)% Income from
discontinued operations, net of tax 0 .6 1 .4 (57.1)%
Net income $ 201 .8 $ 239 .2 (15.6)% Less: Net income (loss)
attributable to noncontrolling interests 0 .9 (0 .5)
N/A Net income attributable to ConAgra Foods, Inc. $ 200 .9 $ 239
.7 (16.2)% Earnings per share – basic Income from
continuing operations $ 0 .46 $ 0 .54 (14.8)% Income from
discontinued operations - - - Net
income $ 0 .46 $ 0 .54 (14.8)% Weighted average shares
outstanding 437 .8 443 .2 (1.2)% Earnings per
share – diluted Income from continuing operations $ 0 .45 $
0 .53 (15.1)% Income from discontinued operations -
0 .01 N/A Net income $ 0 .45 $ 0 .54 (16.7)%
Weighted average share and share
equivalents outstanding
441 .6 446 .2 (1.0)%
ConAgra Foods, Inc. Consolidated Statements of Earnings (in
millions, except per share amounts) (unaudited) SECOND QUARTER 26
Weeks Ended 26 Weeks Ended
November 28, 2010
November 29, 2009
Percent Change
Net sales $ 5,978 .7 $ 5,986 .4 (0.1)% Costs and expenses: Cost of
goods sold 4,566 .8 4,437 .6 2.9% Selling, general and
administrative expenses 838 .4 878 .0 (4.5)% Interest expense, net
71 .0 81 .9 (13.3)% Income from continuing operations
before income taxes and equity method investment earnings 502 .5
588 .9 (14.7)% Income tax expense 168 .4 202 .9 (17.0)% Equity
method investment earnings 10 .8 14 .8 (27.0)% Income
from continuing operations 344 .9 400 .8 (13.9)% Income from
discontinued operations, net of tax 3 .2 3 .6 (11.1)%
Net income $ 348 .1 $ 404 .4 (13.9)% Less: Net income (loss)
attributable to noncontrolling interests 0 .8 (1 .2)
N/A Net income attributable to ConAgra Foods, Inc. $ 347 .3 $ 405
.6 (14.4)% Earnings per share – basic Income from
continuing operations $ 0 .78 $ 0 .91 (14.3)% Income from
discontinued operations - - - Net
income $ 0 .78 $ 0 .91 (14.3)% Weighted average shares
outstanding 439 .7 443 .2 (0.8)% Earnings per
share – diluted Income from continuing operations $ 0 .77 $
0 .90 (14.4)% Income from discontinued operations 0 .01
0 .01 - Net income $ 0 .78 $ 0 .91 (14.3)%
Weighted average share and share
equivalents outstanding
443 .8 445 .8 (0.4)% ConAgra
Foods, Inc. Consolidated Balance Sheets (in millions) (unaudited)
November 28, 2010
May 30, 2010
ASSETS Current assets Cash and cash equivalents
$ 545.2 $ 953.2 Receivables, less allowance for doubtful accounts
of $7.6 and $8.5 902.5 849.6 Inventories 1,974.3 1,606.5 Prepaid
expenses and other current assets 771.8 307.3 Current assets held
for sale - 243.5 Total current
assets (4,193.8 ) (3,960.1 ) Property, plant and equipment,
net 2,666.1 2,625.0 Goodwill 3,606.9 3,552.1 Brands, trademarks and
other intangibles, net 932.7 874.8 Other assets 204.0 695.6
Noncurrent assets held for sale - 30.4
$ 11,603.5 $ 11,738.0
LIABILITIES
AND STOCKHOLDERS' EQUITY Current liabilities Notes payable $
0.6 $ 0.6 Current installments of long-term debt 356.1 260.2
Accounts payable 1,122.8 919.1 Accrued payroll 123.3 263.9 Other
accrued liabilities 677.2 579.0 Current liabilities held for sale
- 13.4 Total current liabilities
2,280.0 2,036.2 Senior long-term debt, excluding current
installments 2,684.0 3,030.5 Subordinated debt 195.9 195.9 Other
noncurrent liabilities 1,491.9 1,541.3 Noncurrent liabilities held
for sale - 5.2 Total stockholders' equity 4,951.7
4,928.9 $ 11,603.5 $ 11,738.0
ConAgra Foods, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(in millions)
(unaudited)
Twenty-six weeks ended
November 28, November 29, 2010
2009 Cash flows from operating activities: Net income $
348.1 $ 404.4 Income from discontinued operations
3.2 3.6 Income from
continuing operations 344.9 400.8 Adjustments to reconcile
income from continuing operations to net cash flows from operating
activities: Depreciation and amortization 175.5 159.5 Impairment
charges related to Garner accident — 19.6 Insurance recoveries
recognized related to Garner accident (1.8 ) (41.0 ) Advances from
insurance carriers related to Garner accident 10.9 28.6 Proceeds
from interest rate swap settlement 31.5 — Loss on sale of fixed
assets 3.0 2.8 Distributions from affiliates greater (less) than
current earnings (2.7 ) 3.4 Contributions to pension plans (112.0 )
(17.1 ) Share-based payments expense 22.7 26.7 Non-cash interest
income on payment-in-kind notes (37.3 ) (39.8 ) Other items 56.2
36.9 Change in operating assets and liabilities before effects of
business acquisitions and dispositions: Accounts receivable (47.7 )
(71.7 ) Inventory (353.0 ) (109.4 ) Prepaid expenses and other
current assets 59.1 28.6 Accounts payable 207.2 130.9 Accrued
payroll (139.9 ) 16.3 Other accrued liabilities
99.3 109.4 Net cash
flows from operating activities - continuing operations 315.9 684.5
Net cash flows from operating activities - discontinued operations
3.2 (27.3
) Net cash flows from operating activities
319.1 657.2
Cash flows from investing activities: Additions to property, plant
and equipment (211.2 ) (239.8 ) Sale of property, plant and
equipment 1.5 2.3 Advances from insurance carriers related to
Garner accident 13.1 10.6 Purchase of businesses and intangible
assets
(136.0 )
(3.0 ) Net cash flows from investing
activities - continuing operations (332.6 ) (229.9 ) Net cash flows
from investing activities - discontinued operations
245.7 4.3 Net cash
flows from investing activities
$ (86.9 )
$ (225.6 )
ConAgra
Foods, Inc. and Subsidiaries Condensed Consolidated
Statements of Cash Flows (continued)
(in millions)
(unaudited)
Twenty-six weeks ended November
28, November 29, 2010 2009
Cash flows from financing activities: Repayment of long-term debt $
(289.3 ) $ (9.0 ) Repurchase of ConAgra Foods common shares (200.0
) — Cash dividends paid (176.4 ) (169.2 ) Exercise of stock options
and issuance of other stock awards 21.6 (11.7 ) Other items
(0.2 ) 1.4 Net
cash flows from financing activities - continuing operations (644.3
) (188.5 ) Net cash flows from financing activities - discontinued
operations
(0.1 )
(0.4 ) Net cash flows from financing
activities
(644.4 )
(188.9
) Effect of exchange rate changes on cash and cash
equivalents 4.2 4.3 Net change in cash and cash equivalents
(408.0 ) 247.0 Cash and cash equivalents at beginning of period
953.2 243.2
Cash and cash equivalents at end of period
$
545.2 $ 490.2
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