Heinz Chairman Reviews the Company’s Record Fiscal 2011 Results at Annual Meeting of Shareholders, Reaffirms Fiscal 2012 Ou...
August 30 2011 - 9:06AM
Business Wire
At the H.J. Heinz Company (NYSE:HNZ) Annual Meeting of
Shareholders today, Chairman, President and CEO William R. Johnson
said: “Fiscal 2011 marked yet another great year for Heinz as we
delivered record sales, net income and operating free cash flow
while completing key acquisitions in Brazil and China to accelerate
our growth.”
In his address to shareholders, Mr. Johnson also reaffirmed the
Company’s previously announced Fiscal 2012 outlook, saying: “For
the full year, Heinz expects constant currency earnings in the
range of $3.24 to $3.32 per share, excluding special charges of
approximately 35 cents per share for a series of one-time strategic
productivity investments. These one-time initiatives are designed
to help drive sustainable growth, offset rising commodity costs and
improve the efficiency of our global supply chain.”
Charges for productivity initiatives include charges for
workforce reductions, factory closures and other implementation
costs taken in Fiscal 2012 to accelerate growth. Operating free
cash flow is defined as cash from operations less capital
expenditures net of proceeds from disposal of Property, Plant &
Equipment. Also, constant currency as used in this press release is
defined as the reported amount adjusted for translation (the
effect of changes in average foreign exchange rates between the
current period and the corresponding prior year) and
the impact of current-year foreign currency translation
hedges.
Heinz reported its Fiscal 2012 first-quarter results on August
23, 2011. Commenting on those results at today’s Annual Meeting in
Pittsburgh, Mr. Johnson said: “We believe that our first-quarter
results put Heinz on track to achieve our financial targets for the
full year, despite the deteriorating U.S. economic environment and
the challenge posed by escalating commodity costs and weak consumer
confidence.”
Mr. Johnson noted that Heinz in May increased its annualized
common stock dividend for Fiscal 2012 by 12 cents to $1.92 per
share. Commenting on the dividend, he said: “This increase of
almost 7% reflects our strong performance and the Board’s
confidence in our plan to deliver sustainable growth. Heinz has now
increased the dividend by almost 80% since Fiscal 2004 and returned
more than $3.5 billion to shareholders through dividend payments
during this period.”
Mr. Johnson discussed two key acquisitions that Heinz completed
in Fiscal 2011: Foodstar, the producer of Master® soy sauces and
fermented bean curd in China; and Quero®, a Brazilian brand of
tomato-based sauces, ketchup, condiments and vegetables, with
annual sales of approximately $325 million.
“Our recent acquisitions in Brazil and China are exceeding our
expectations while providing exciting new platforms for future
growth in a rapidly changing world,” Mr. Johnson told shareholders.
“Quero is off to a strong start in Fiscal 2012 and we expect it to
double our sales in Latin America this year as we invest behind the
brand and expand to new categories and customers.”
He added: “We expect Foodstar to boost our Company’s total sales
in China to around $350 million in Fiscal 2012 – but I see this as
just the beginning.”
Mr. Johnson also highlighted the global growth of ketchup:
“Around the world, we see ketchup as one of the keys to growing our
Core Portfolio. Our founder introduced Heinz Ketchup in 1876 right
here in Pittsburgh and 135 years later, sales of our flagship
product continue to grow.”
He added: “Our ketchup franchise continues to benefit from
innovations like Heinz Dip & Squeeze®, which we introduced last
year after much anticipation. Sales of Dip & Squeeze to
restaurants continue to expand but we are also very enthused about
the retail launch of our new Dip & Squeeze ten-pack starting
this month.”
Mr. Johnson concluded his speech by thanking shareholders “for
investing in Heinz, which is more focused than ever on
strengthening our position as one of the best-performing companies
in the packaged foods industry.”
SAFE HARBOR PROVISIONS FOR FORWARD-LOOKING
STATEMENTS:
This press release and our other public pronouncements contain
forward-looking statements within the meaning of the “safe harbor”
provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are generally identified by the words
“will,” “expects,” “anticipates,” “believes,” “estimates” or
similar expressions and include our expectations as to future
revenue growth, earnings, capital expenditures and other spending,
dividend policy, and planned credit rating, as well as anticipated
reductions in spending. These forward-looking statements reflect
management’s view of future events and financial performance. These
statements are subject to risks, uncertainties, assumptions and
other important factors, many of which may be beyond Heinz’s
control, and could cause actual results to differ materially from
those expressed or implied in these forward-looking statements.
Factors that could cause actual results to differ from such
statements include, but are not limited to:
- sales, volume, earnings, or cash flow
growth,
- general economic, political, and
industry conditions, including those that could impact consumer
spending,
- competitive conditions, which affect,
among other things, customer preferences and the pricing of
products, production, and energy costs,
- competition from lower-priced private
label brands,
- increases in the cost and restrictions
on the availability of raw materials, including agricultural
commodities and packaging materials, the ability to increase
product prices in response, and the impact on profitability,
- the ability to identify and anticipate
and respond through innovation to consumer trends,
- the need for product recalls,
- the ability to maintain favorable
supplier and customer relationships, and the financial viability of
those suppliers and customers,
- currency valuations and devaluations
and interest rate fluctuations,
- changes in credit ratings, leverage,
and economic conditions and the impact of these factors on our cost
of borrowing and access to capital markets,
- our ability to effectuate our strategy,
including our continued evaluation of potential opportunities, such
as strategic acquisitions, joint ventures, divestitures, and other
initiatives, our ability to identify, finance, and complete these
transactions and other initiatives, and our ability to realize
anticipated benefits from them,
- the ability to successfully complete
cost reduction programs and increase productivity,
- the ability to effectively integrate
acquired businesses,
- new products, packaging innovations,
and product mix,
- the effectiveness of advertising,
marketing, and promotional programs,
- supply chain efficiency,
- cash flow initiatives,
- risks inherent in litigation, including
tax litigation,
- the ability to further penetrate and
grow and the risk of doing business in international markets,
particularly our emerging markets; economic or political
instability in those markets, strikes, nationalization, and the
performance of business in hyperinflationary environments, in each
case such as Venezuela; and the uncertain global macroeconomic
environment and sovereign debt issues, particularly in Europe,
- changes in estimates in critical
accounting judgments and changes in laws and regulations, including
tax laws,
- the success of tax planning
strategies,
- the possibility of increased pension
expense and contributions and other people-related costs,
- the potential adverse impact of natural
disasters, such as flooding and crop failures,
- the ability to implement new
information systems and potential disruptions due to failures in
information technology systems,
- with regard to dividends, dividends
must be declared by the Board of Directors and will be subject to
certain legal requirements being met at the time of declaration, as
well as our Board’s view of our anticipated cash needs, and
- other factors described in “Risk
Factors” and “Cautionary Statement Relevant to Forward-Looking
Information” in the Company’s Annual Report on Form 10-K for the
fiscal year ended April 27, 2011 and reports on Forms 10-Q
thereafter.
The forward-looking statements are and will be based on
management’s then current views and assumptions regarding future
events and speak only as of their dates. The Company undertakes no
obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as required by the securities laws.
ABOUT HEINZ: H.J. Heinz Company, offering “Good Food Every Day”™
is one of the world’s leading marketers and producers of healthy,
convenient and affordable foods specializing in ketchup, sauces,
meals, soups, snacks and infant nutrition. Heinz provides superior
quality, taste and nutrition for all eating occasions whether in
the home, restaurants, the office or “on-the-go.” Heinz is a global
family of leading branded products, including Heinz® Ketchup,
sauces, soups, beans, pasta and infant foods (representing over one
third of Heinz’s total sales), Ore-Ida® potato products, Weight
Watchers® Smart Ones® entrees, T.G.I. Friday’s® snacks, and Plasmon
infant nutrition. Heinz is famous for its iconic brands on six
continents, showcased by Heinz® Ketchup, The World’s Favorite
Ketchup®.
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