- Consolidated net sales were $184.9 million, down from $207.7
million.
- Snacks segment net sales grew 1.6 percent.
- Nuts segment net sales declined 23.2 percent.
- Gross profit was $43.4 million, up from $34.2 million.
- Gross margin was 23.4 percent, up from 16.5 percent.
- GAAP net loss was $15.6 million, compared to a GAAP net loss of
$44.0 million.
- Adjusted EBITDA was $23.2 million, up from $11.2 million.
- Restates GAAP diluted EPS for Q2 and YTD Q2 of fiscal
2013.
(All comparisons above are to the third quarter
of fiscal 2012)
Diamond Foods, Inc. (Nasdaq:DMND) ("Diamond") today reported
financial results for its fiscal 2013 third quarter, which ended
April 30, 2013.
In the third quarter of fiscal 2013, Diamond's GAAP net loss was
$15.6 million and its GAAP diluted loss per share ("EPS") was
($0.71). GAAP results for the quarter included $12.9 million of
certain SG&A expenses described below and a $1.9 million
non-cash charge related to a change in the fair value of the
Oaktree warrant liability. Excluding these items, Diamond's
non-GAAP net income for the third quarter of fiscal 2013 was $1.1
million and non-GAAP diluted EPS was $0.05.
"The progress we are making with our efforts to revitalize the
Company is reflected in our results this quarter," said Diamond's
Chief Executive Officer Brian J. Driscoll. "The improvement in
gross margins reflects both an increase in net price realization in
our portfolio and results of our cost saving efforts that are
materializing in our operations and supply chain. While we still
have difficult and important challenges to tackle, we continue to
track toward an operating model that is designed to create
sustainable growth."
Financial Review
(All comparisons below are to the third quarter
of fiscal 2012 unless specified otherwise)
Consolidated net sales during the quarter decreased 11.0
percent, to $184.9 million, compared to the same quarter of the
prior year. Gross profit was $43.4 million, or 23.4 percent of net
sales, for the third quarter of fiscal 2013, compared to $34.2
million, or 16.5 percent of net sales, for the same quarter in the
prior year.
The Company has two reportable segments: Snacks and Nuts. The
Snacks segment includes products sold under the Kettle U.S., Kettle
U.K. and Pop Secret brands. The Nuts segment includes products sold
under the Diamond of California and Emerald brands.
Snacks Performance: Snacks net sales increased
1.6 percent, to $104.2 million driven by an increase in net price
realization partially offset by a 5.5 percent decrease in volume.
Snacks gross profit was $36.7 million, or 35.2 percent of net
sales, for the third quarter of fiscal 2013, compared to $28.1
million, or 27.4 percent of net sales, for the same quarter in the
prior year. This improvement in Snacks gross profit as a percentage
of net sales reflected an increase in net price realization and a
reduction in unit processing costs.
Nuts Performance: Nuts net sales decreased 23.2
percent, to $80.7 million driven by a 40.3 percent decrease in
volume. The primary drivers of the volume decline were planned
reductions in SKUs and lower promotional spending associated with
the Emerald brand and lower walnut supply. Nuts gross profit was
$6.7 million, or 8.3 percent of net sales, in the third quarter of
fiscal 2013, compared to $6.1 million, or 5.8 percent of net sales,
for the same quarter in the prior year. This improvement in Nuts
gross profit as a percentage of net sales reflected an increase in
net price realization, the elimination of lower performing SKUs,
and cost savings initiatives, partially offset by an increase in
certain commodity costs.
SG&A expense increased to $35.3 million for the third
quarter of fiscal 2013, compared to $33.3 million for the same
quarter in the prior year. Included in the third quarter of fiscal
2013 are $12.9 million of charges related to Fishers plant closure,
impairment of an intangible asset, consulting fees and legal
expenses. Included in the third quarter of fiscal 2012 are $8.3
million of charges that are related primarily to the audit
committee investigation, restatement expenses and legal
expenses.
Advertising expense was $8.0 million, or 4.3 percent of
net sales, for the third quarter of fiscal 2013, compared to $7.2
million, or 3.5 percent of net sales, for the same quarter in the
prior year. This increase in advertising expense was primarily due
to support of the Pop Secret and Kettle brands.
The Company recognized a $1.9 million loss on the Oaktree
warrant liability in the quarter due to the change in the fair
value of the warrant between January 31, 2013 and April 30,
2013.
Net interest expense was $14.5 million in the third
quarter of fiscal 2013 compared to $7.7 million in the same quarter
in the prior year. The increase was primarily due to the Oaktree
debt and the higher interest rate on the Secured Credit
Agreement.
The Company's effective tax rate was 5.1 percent for the
third quarter of fiscal 2013.
GAAP net loss was ($15.6) million compared to a loss of
($44.0) million in the prior year. On a non-GAAP basis, net income
was $1.1 million compared to a net loss of ($4.9) million in the
prior year.
EPS for the third quarter of fiscal 2013 on a GAAP diluted
basis was a loss of ($0.71) compared to a loss of ($2.02) in the
prior year. Non-GAAP EPS on a diluted basis was earnings of $0.05
compared to a loss of ($0.22) in the prior year.
The non-GAAP diluted EPS calculation includes 1.6 million
and 1.7 million shares related to the Oaktree warrants based on the
Treasury stock method for the third quarter and year-to-date
periods, respectively.
Capital expenditures were $2.1 million for the third
quarter of fiscal 2013.
Adjusted EBITDA was $23.2 million, or 12.6 percent of net
sales, in the third quarter of fiscal 2013, compared to $11.2
million, or 5.4 percent of net sales, in the prior year.
Year-to-date adjusted EBITDA increased $19.6 million, to $77.2
million, compared to the prior year. Please refer to the table at
the end of this press release for a reconciliation of GAAP to
non-GAAP information.
As of April 30, 2013, net debt outstanding was $577.8
million, including the Oaktree debt at its carrying value, as
described in Footnote 3 of the Notes to Condensed Consolidated
Financial Statements included as a part of Diamond's Quarterly
Report on Form 10-Q.
Cash and availability on Diamond's bank revolving line of
credit on June 7, 2013 was approximately $96 million.
Outlook
Consistent with the outlook provided in the second quarter, net
sales are expected to decline more in the back half of the fiscal
year than the first half as compared to the prior year. Therefore,
fourth quarter sales are expected to decline more than in the third
quarter, driven primarily by the Nuts Segment. Fourth quarter gross
margin is expected to be largely consistent with year-to-date
performance. Advertising spending is expected to increase in the
fourth quarter as compared to the third quarter and the prior year
due largely to campaigns focused on Kettle and Pop Secret.
GAAP Diluted EPS to be Restated for Q2 of
Fiscal 2013
Diamond plans to file an amendment to its quarterly report on
Form 10-Q for the quarterly period ended January 31, 2013, to
restate its previously reported GAAP diluted earnings (loss) per
share for the three and six months ended January 31, 2013. The
Company determined that the calculation of diluted earnings (loss)
per share did not reflect the dilutive impact of the change in fair
value in the Oaktree Capital Management, L.P. warrant liability. In
accordance with ASC 260, when calculating diluted earnings (loss)
per share, the gain on the warrant liability should have been
reflected as an adjustment to the income available to common
stockholders and the assumed exercise of the Oaktree warrant should
be an adjustment to the weighted average shares outstanding. These
adjustments for the gain or loss attributable to the Oaktree
warrant are required when the effect of the adjustment would be
dilutive. As a result, for the three months ended January 31, 2013,
diluted earnings (loss) per share was restated from the previously
reported diluted earnings per share of $0.43 to a restated diluted
loss per share of ($0.37). For the six months ended January 31,
2013, diluted earnings (loss) per share was restated from the
previously reported diluted loss per share of ($0.03) to a restated
diluted loss per share of ($0.50). Please refer to the restated
information as follows:
| |
As
Previously |
|
|
|
|
|
|
| |
Reported |
Adjustment |
As
Restated |
As
Reported |
| Numerator: |
Three Months Ended January 31,
2013 |
Six Months Ended January 31,
2013 |
Three Months Ended January 31,
2013 |
Six Months Ended January 31,
2013 |
Three Months Ended January 31,
2013 |
Six Months Ended January 31,
2013 |
Three Months Ended January 31,
2012 |
Six Months Ended January 31,
2012 |
| Net income (loss) |
$ 10,141 |
$ (588) |
$ -- |
$ -- |
$ 10,141 |
$ (588) |
$ (20,184) |
$ (9,383) |
| Less: income allocated to
participating securities |
(173) |
-- |
(2) |
-- |
(175) |
-- |
-- |
-- |
| Income (loss) attributable to
common shareholders - basic |
9,968 |
(588) |
(2) |
-- |
9,966 |
(588) |
(20,184) |
(9,383) |
| |
|
|
|
|
|
|
|
|
| Add: undistributed income
attributable to participating securities |
175 |
-- |
-- |
-- |
175 |
-- |
-- |
-- |
| Less: income attributed to gain
on warrant liability |
-- |
-- |
(18,625) |
(11,109) |
(18,625) |
(11,109) |
-- |
-- |
| Less: undistributed income
reallocated to participating securities |
(165) |
-- |
165 |
-- |
-- |
-- |
-- |
-- |
| Income (loss) attributable to
common shareholders - diluted |
$ 9,978 |
$ (588) |
$ (18,462) |
$ (11,109) |
$ (8,484) |
$ (11,697) |
$ (20,184) |
$ (9,383) |
| |
|
|
|
|
|
|
|
|
| Denominator: |
|
|
|
|
|
|
|
|
| Weighted average shares
outstanding - basic |
21,781 |
21,703 |
-- |
-- |
21,781 |
21,703 |
21,724 |
21,684 |
| Dilutive shares - stock options
and warrant |
1,361 |
-- |
73 |
1,805 |
1,434 |
1,805 |
-- |
-- |
| Weighted average shares
outstanding - diluted |
23,142 |
21,703 |
73 |
1,805 |
23,215 |
23,508 |
21,724 |
21,684 |
| |
|
|
|
|
|
|
|
|
| Income (loss) per share attributable to
common shareholders (1): |
|
|
|
|
|
|
|
|
| Basic |
$ 0.46 |
$ (0.03) |
$ -- |
$ -- |
$ 0.46 |
$ (0.03) |
$ (0.93) |
$ (0.43) |
| Diluted |
$ 0.43 |
$ (0.03) |
$ (0.80) |
$ (0.47) |
$ (0.37) |
$ (0.50) |
$ (0.93) |
$ (0.43) |
| |
|
|
|
|
|
|
|
|
| (1)
Computations may reflect rounding adjustments. |
Conference Call
Diamond will host an investor conference call and webcast
on June 10, 2013, at 2:45 p.m. Pacific Daylight Time, to discuss
results for the third quarter of fiscal 2013.
To participate in the call via telephone dial (888) 765-5568
from the U.S./Canada or (913) 981-5530 elsewhere and enter the
participant pass code of 202-2171. To listen to the call over the
internet, visit the Company's website at
http://www.diamondfoods.com and select "Investor Relations."
Archived audio replays of the call will be available on the
Company's website and via telephone. The latter will begin
approximately two hours after the call's conclusion and remain
available through 6:00 p.m. Pacific Daylight Time June 19, 2013. It
can be accessed by dialing (888) 203-1112 from the U.S./Canada or
(719) 457-0820 elsewhere. Both phone numbers require the
participant pass code 202-2171.
Upcoming Events
Diamond Foods will be attending the Jefferies 2013 Global
Consumer Conference on June 18-19, 2013. The following is a
link to the webcast of Diamond's presentation at the conference on
June 19th at 9:30am (Eastern Daylight Time):
http://wsw.com/webcast/jeff76/dmnd/
To receive email notification of future press releases from
Diamond Foods, please visit
http://investor.diamondfoods.com and select "email
alerts."
| Financial
Summary |
| |
|
|
|
|
| Summarized
Statement of Operations (Unaudited): |
| |
|
|
|
|
| |
Three months
ended |
Nine months
ended |
| |
April 30, |
April 30, |
| (in thousands, except per share
amounts) |
2013 |
2012 |
2013 |
2012 |
| Net sales |
$184,905 |
$207,685 |
$664,211 |
$757,429 |
| Cost of sales |
141,555 |
173,457 |
511,746 |
619,972 |
| Gross profit |
43,350 |
34,228 |
152,465 |
137,457 |
| Operating expenses: |
|
|
|
|
| Selling, general and
administrative |
35,334 |
33,260 |
105,781 |
97,019 |
| Advertising |
8,023 |
7,200 |
29,362 |
31,554 |
| Acquisition and integration
related expenses |
-- |
11,336 |
-- |
40,641 |
| (Gain) loss on warrant
liability |
1,873 |
-- |
(9,236) |
-- |
| Total operating expenses |
45,230 |
51,796 |
125,907 |
169,214 |
| Income (loss) from
operations |
(1,880) |
(17,568) |
26,558 |
(31,757) |
| Interest expense, net |
14,542 |
7,701 |
42,685 |
19,933 |
| Income (loss) before income
taxes |
(16,422) |
(25,269) |
(16,127) |
(51,690) |
| Income taxes (benefit) |
(840) |
18,748 |
43 |
1,710 |
| Net (loss) |
$ (15,582) |
$ (44,017) |
$ (16,170) |
$ (53,400) |
| Earnings (loss) per share
(EPS): |
|
|
|
|
| Basic |
$ (0.71) |
$ (2.02) |
$ (0.74) |
$ (2.46) |
| Diluted |
$ (0.71) |
$ (2.02) |
$ (1.08) |
$ (2.46) |
| Shares used to compute
EPS: |
|
|
|
|
| Basic |
21,819 |
21,752 |
21,774 |
21,676 |
| Diluted |
21,819 |
21,752 |
23,514 |
21,676 |
| |
| Segment
Information (Unaudited): |
| |
|
|
|
|
|
|
|
| |
Three months
ended |
% Change |
Nine months
ended |
% Change |
Year Ended |
| |
April 30, |
From |
April 30, |
From |
July 31 |
| (in thousands) |
2013 |
2012 |
2012 to 2013 |
2013 |
2012 |
2012 to 2013 |
2012 |
| Net sales |
|
|
|
|
|
|
|
| Snacks |
$104,201 |
$102,546 |
2% |
$320,865 |
$311,804 |
3% |
$425,175 |
| Nuts |
80,704 |
105,139 |
-23% |
343,346 |
445,625 |
-23% |
556,243 |
| Total |
184,905 |
207,685 |
-11% |
664,211 |
757,429 |
-12% |
981,418 |
| Gross profit |
|
|
|
|
|
|
|
| Snacks |
36,684 |
28,108 |
31% |
109,812 |
91,553 |
20% |
125,354 |
| Nuts |
6,666 |
6,120 |
9% |
42,653 |
45,904 |
-7% |
54,368 |
| Total |
$43,350 |
$34,228 |
27% |
$152,465 |
$137,457 |
11% |
$179,722 |
| |
| Summarized Balance Sheet
Data (Unaudited): |
| |
|
|
| |
April 30, |
| (in thousands) |
2013 |
2012 |
| Total current assets |
$251,269 |
$350,864 |
| Restricted cash |
-- |
6,382 |
| Property, plant and equipment, net |
138,420 |
159,985 |
| Goodwill |
401,906 |
408,075 |
| Other intangible assets, net |
428,419 |
443,276 |
| Other long-term assets |
20,886 |
6,421 |
| Total
assets |
$1,240,900 |
$1,375,003 |
| |
|
|
| Total current liabilities |
$200,008 |
$290,790 |
| Long-term obligations |
579,202 |
557,115 |
| Deferred income taxes |
127,604 |
132,477 |
| Other liabilities |
24,825 |
28,117 |
| Total stockholders' equity |
309,261 |
366,504 |
| Total liabilities and
stockholders' equity |
$1,240,900 |
$1,375,003 |
| |
| Non-GAAP Financial
Information |
| |
|
|
|
|
|
Reconciliation of GAAP Income (Loss) Before Income Taxes to
Non-GAAP EPS: |
| |
|
|
|
|
| |
Three months
ended |
Nine months
ended |
| |
April 30, |
April 30, |
| (in thousands, except per share
amounts) |
2013 |
2012 |
2013 |
2012 |
| GAAP income (loss) before
income taxes |
$ (16,422) |
$ (25,269) |
$ (16,127) |
$ (51,690) |
| (Gain) Loss on warrant
liability |
1,873 |
-- |
(9,236) |
-- |
| Reduction of liability due to
lease assignment |
-- |
-- |
(1,319) |
-- |
| Adjustment to exclude
forbearance fee |
-- |
1,006 |
-- |
1,006 |
| Adjustment to remove costs
associated with acquisitions and integrations |
-- |
11,336 |
-- |
40,641 |
| Adjustment to exclude certain
SG&A expenses (1) |
12,868 |
8,309 |
31,662 |
21,035 |
| Non-GAAP income before income
taxes |
(1,681) |
(4,618) |
4,980 |
10,992 |
| GAAP income taxes
(benefit) |
(840) |
18,748 |
43 |
1,710 |
| Tax effect of Non-GAAP
adjustments |
(1,967) |
(18,462) |
(2,549) |
(2,392) |
| Non-GAAP income taxes
(benefit) |
(2,807) |
286 |
(2,506) |
(682) |
| Non-GAAP net income (loss) |
$ 1,126 |
$ (4,904) |
$ 7,486 |
$ 11,674 |
| Non-GAAP
EPS-diluted |
$ 0.05 |
$ (0.22) |
$ 0.32 |
$ 0.53 |
| Shares used in computing
Non-GAAP EPS-diluted |
23,500 |
22,108 |
23,464 |
22,026 |
(1) Fiscal 2013 SG&A expenses are related
primarily to audit committee investigation, restatement-related
expenses, legal investigation expenses, consulting fees, accrued
contract termination expenses, retention and severance accruals,
Fishers plant closure costs and impairment of an intangible
asset. These expenses are partially offset by the clawback of
bonuses paid to a former CEO and the reversal of certain previously
recorded stock compensation expenses associated with former
executives.
With respect to the Fishers plant closure costs, the Q3 2013
adjustment includes $4.9 million related to the Fishers operating
lease termination liability, which includes future lease
obligations and other future standard maintenance costs netted
against projected sublease income, ($0.1) million in decrease to
severance charges previously recorded, and $0.9 million in other
closure costs.
With respect to the impairment of an intangible asset, the Q3
2013 adjustment includes $1.6 million associated with the customer
contracts and related relationships.
In the third quarter of fiscal 2012, $7.9 million in costs were
incurred due to SG&A expenses related primarily to the audit
committee investigation, restatement-related expenses, and legal
expenses, and $0.4 million in certain stock-based compensation.
| Reconciliation of GAAP
Net Income (Loss) to Adjusted EBITDA: |
| |
|
|
|
|
| |
Three months
ended |
Nine months
ended |
| |
April 30, |
April 30, |
| (in thousands) |
2013 |
2012 |
2013 |
2012 |
| Net income (loss) |
$ (15,582) |
$ (44,017) |
$ (16,170) |
$ (53,400) |
| Income taxes
(benefit) |
(840) |
18,748 |
43 |
1,710 |
| Income (loss) before income
taxes |
(16,422) |
(25,269) |
(16,127) |
(51,690) |
| Interest expense, net |
14,542 |
7,701 |
42,685 |
19,933 |
| Income (loss) from
operations |
(1,880) |
(17,568) |
26,558 |
(31,757) |
| Costs associated with
acquisitions and integrations |
-- |
11,336 |
-- |
40,641 |
| Reduction of liability due to
lease assignment |
-- |
-- |
(1,319) |
-- |
| (Gain) Loss on warrant
liability |
1,873 |
-- |
(9,236) |
-- |
| Certain SG&A expenses
(1) |
12,777 |
7,863 |
33,457 |
20,589 |
| Stock-based compensation
expense (2) |
1,365 |
2,291 |
2,487 |
7,142 |
| Depreciation and
amortization |
9,072 |
7,265 |
25,210 |
20,924 |
| Adjusted
EBITDA |
$ 23,207 |
$ 11,187 |
$ 77,157 |
$ 57,538 |
(1) Fiscal 2013 SG&A expenses are related primarily to audit
committee investigation, restatement-related expenses, legal
investigation expenses, consulting fees, accrued contract
termination expenses, retention and severance accruals, Fishers
plant closure costs and impairment of an intangible asset. These
expenses are partially offset by the clawback of bonuses paid to a
former CEO.
With respect to the Fishers plant closure costs, the Q3 2013
adjustment includes $4.9 million related to the Fishers operating
lease termination liability, which includes future lease
obligations and other future standard maintenance costs netted
against projected sublease income, ($0.1) million in decrease to
severance charges previously recorded, and $0.9 million in other
closure costs.
With respect to the impairment of an intangible asset, the Q3
2013 adjustment includes $1.6 million associated with the customer
contracts and related relationships.
In the third quarter of fiscal 2012, $7.9 million in costs were
incurred due to SG&A expenses related primarily to the audit
committee investigation, restatement-related expenses, and legal
expenses.
(2) Stock-based compensation for the nine months ended
April 30, 2013, included a $2.5 million reversal of certain
previously recorded stock compensation expenses associated with
former executives.
About Diamond's
Non-GAAP Financial Measures
This release contains non-GAAP financial measures of Diamond's
performance ("non-GAAP financial measures") for different
periods. Non-GAAP financial measures should not be considered
as a substitute for financial measures prepared in accordance with
GAAP. Diamond's non-GAAP financial measures do not reflect a
comprehensive system of accounting and differ both from GAAP
financial measures and from non-GAAP financial measures used by
other companies. Diamond urges investors to review its
reconciliation of non-GAAP financial measures to GAAP financial
measures and its financial statements to evaluate its business.
Diamond believes that its non-GAAP financial measures provide
meaningful information regarding operating results because they do
not include amounts that Diamond excludes when monitoring operating
results and assessing performance of the business. Diamond
believes that its non-GAAP financial measures also facilitate
comparison of results for current periods and business outlook for
future periods. Diamond's non-GAAP financial measures include
adjustments for the following items in its Adjusted EBITDA
calculation:
- The third quarter of fiscal 2013 included $12.8 million of
certain charges primarily for Fishers plant closure costs,
impairment of an intangible asset, consulting fees and legal
expenses. In addition, the quarter included a charge of $1.9
million due to a loss on the Oaktree warrant liability and
stock-based compensation expense of $1.4 million. The Fishers plant
closure costs include $4.9 million related to the Fishers operating
lease termination liability, which includes future lease
obligations and other future standard maintenance costs netted
against projected sublease income, ($0.1) million in decrease to
severance charges previously recorded, and $0.9 million in other
closure costs. The impairment of intangible asset adjustment
includes $1.6 million associated with customer contracts and
related relationships.
- In the third quarter of fiscal 2012, $11.3 million in costs
were incurred due to the proposed acquisition of Pringles, $7.9
million due to SG&A expenses related primarily to the audit
committee investigation, restatement-related expenses, and legal
expenses, and $2.3 million in stock-based compensation.
- Adjusted EBITDA is used by management as a measure of operating
performance. Adjusted EBITDA is defined as net income before
interest expense, income taxes, depreciation, amortization, equity
compensation and certain other expenses, including the
aforementioned SG&A and acquisition and integration
costs. We believe that adjusted EBITDA is useful as an
indicator of ongoing operating performance. As a result, some
management reports feature adjusted EBITDA, in conjunction with
traditional GAAP measures, as part of our overall assessment of
company performance.
Diamond's management uses non-GAAP measures in internal reports
used to monitor and make decisions about its business, such as
monthly financial reports prepared for management. The
principal limitation of the non-GAAP measures is that they exclude
significant expenses and gains required under GAAP. They also
reflect the exercise of management judgments about which
adjustments are appropriately made. To mitigate this
limitation, Diamond presents the non-GAAP measures in connection
with GAAP results and recommends that investors do not give undue
weight to them. Diamond believes that non-GAAP measures
provide useful information to investors by allowing them to view
the business through the eyes of management, facilitating
comparison of results across historical and future periods, and
providing a focus on the underlying operating performance of the
business.
Note Regarding Forward-looking
Statements
This press release includes forward-looking statements,
including statements about our improvement in gross margins,
increase in net price realization, results of cost savings efforts,
materialization of cost savings in operations and supply chain
projections for net sales, gross margin, advertising spending and
suggestions about future financial and operating performance and
results that may be implicit in summaries of recent
results. We have based these forward-looking statements on our
assumptions, expectations and projections about future events only
as of the date of this presentation, and we make such
forward-looking statements pursuant to the "safe harbor" provisions
of the Private Securities Litigation Reform Act of 1995. Many
of our forward-looking statements include discussions of trends and
anticipated developments under the "Risk Factors" and "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" sections of the periodic reports that we file with the
SEC. We use the words "anticipate," "believe," "estimate,"
"expect," "intend," "plan," "seek," "may" and other similar
expressions to identify forward-looking statements that discuss our
future expectations, contain projections of our results of
operations or financial condition or state other "forward-looking"
information. You also should carefully consider other cautionary
statements elsewhere in this report and in other documents we file
from time to time with the SEC. We do not undertake any obligation
to update forward-looking statements to reflect events or
circumstances occurring after the date of this report. Actual
results may differ materially from what we currently expect because
of many risks and uncertainties, including: risks relating to
our leverage and its effect on our ability to respond to changes in
our business, markets and industry; increase in the cost of our
debt; compliance with debt covenants; ability to raise additional
capital and possible dilutive impact of raising such capital; risks
relating to litigation and regulatory proceedings; uncertainties
relating to relations with growers; availability and cost of
walnuts and other raw materials; increasing competition and
possible loss of key customers; and general economic and capital
markets conditions.
About Diamond
Diamond Foods is an innovative packaged food company
focused on building and energizing brands including Kettle® chips,
Emerald® nut varieties, Pop Secret® popcorn, and Diamond of
California® nuts. The Company's products are distributed in a wide
range of stores where snacks and nuts are sold.
Corporate Web Site: www.diamondfoods.com
The Diamond Foods, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=6112
CONTACT: Investors:
Diamond Foods
Linda Segre
SVP, Corporate Strategy
(415) 230-7952
lsegre@diamondfoods.com
Media:
Sard Verbinnen & Co for Diamond Foods
Stacy Roughan/Alyssa Linn
(310) 201-2040/(415) 618-8750
sroughan@sardverb.com
alinn@sardverb.com
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