Imperial Suspends Quarterly Dividend and Winds Up Mexican Marketing JV
November 03 2011 - 9:00PM
Business Wire
Imperial Sugar Company (NASDAQ:IPSU) announced that its Board of
Directors suspended payment of its regular quarterly dividend of
$0.02 per common share until further notice in light of the
continued pressure on its gross margins and liquidity primarily
caused by sustained high raw sugar prices and competitive refined
sugar pricing. The company indicated that borrowings under its
revolving credit agreement totaled $81.5 million at fiscal year end
September 30, 2011, resulting in available undrawn borrowing
capacity of $44.0 million subject to the terms of the credit
agreement.
The company also announced that in October, it sold its 50%
joint venture interest in Comercializadora Santos Imperial, S. de
R.L. de C.V. to Ingenios Santos, its partner in the joint venture
for $5.5 million in cash. As part of the wind up of the CSI joint
venture, the parties terminated all cross-border exclusive supply
agreements, and entered into a non-exclusive two year agreement for
supply of refined sugar to Imperial from Santos’ mills. John
Sheptor, Imperial’s President and CEO commented, “We are very
pleased with the strategic value our CSI venture provided in the
early period of full NAFTA implementation. As the post-NAFTA
Mexican/US sugar industry has developed, we concluded that a
non-exclusive relationship was in our best interest. We have
highest regard for the Santos organization and look forward to
continuing a mutually beneficial business relationship in the
coming years.”
The Company said that it continues to pursue its previously
announced review of strategic alternatives for its 50% interest in
Wholesome Sweeteners, including the potential sale of
Wholesome.
About Imperial
Imperial Sugar Company is one of the largest processors and
marketers of refined sugar in the United States to food
manufacturers, retail grocers and foodservice distributors. The
Company markets products nationally under the Imperial®, Dixie
Crystals® and Holly® brands. For more information about Imperial
Sugar, visit www.imperialsugar.com.
Statements regarding future market prices and margins, future
import and export levels, future government and legislative action,
future operating results, future availability of raw sugar,
operating efficiencies, results of future investments and strategic
initiatives, future cost savings, future product innovations,
future energy costs, our liquidity and ability to finance our
operations and capital investment programs, future pension plan
contributions and other statements that are not historical facts
contained in this release or discussed on the earnings conference
call are forward-looking statements that involve certain risks,
uncertainties and assumptions. These include, but are not limited
to, market factors, farm and trade policy, our ability to realize
planned cost savings and other improvements, the available supply
of sugar, energy costs, the effect of weather and economic
conditions, results of actuarial assumptions, actual or threatened
acts of terrorism or armed hostilities, legislative, administrative
and judicial actions and other factors detailed in the Company’s
Securities and Exchange Commission filings. Should one or more of
these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual outcomes may vary materially
from those indicated.
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