Seneca Foods Reports Sales and Earnings for the Quarter Ended June 27, 2020
August 05 2020 - 4:15PM
Seneca Foods Corporation (NASDAQ: SENEA, SENEB) today announced
financial results for the first quarter ended June 27, 2020.
Highlights (vs. year-ago, first quarter
results):
- Net sales increased 8.8% to $288.2 million.
- Gross margin percentage increased from 7.2% to 16.9% as
compared to the prior year three months due to higher selling
prices in the first quarter of 2021.
“During the first quarter, we continued to see improved
results from our extensive restructuring undertaken over the last
few years. In addition, pantry loading due to the COVID-19
pandemic helped drive our sales.” stated Kraig Kayser, President
and Chief Executive Officer.
About Seneca Foods
CorporationSeneca Foods is one of North America’s leading
providers of packaged fruits and vegetables, with facilities
located throughout the United States. Its high quality products are
primarily sourced from over 2,000 American farms. Seneca
holds the largest share of the retail private label, food service,
and export canned vegetable markets, distributing to over 90
countries. Products are also sold under the highly
regarded brands of Libby’s®, Aunt Nellie’s®, Green Valley®,
CherryMan®, READ®, and Seneca labels, including Seneca snack
chips. Seneca’s common stock is traded on the Nasdaq Global
Stock Market under the symbols “SENEA” and “SENEB”. SENEA is
included in the S&P SmallCap 600, Russell 2000 and Russell 3000
indices.
Non-GAAP Financial Measures—Operating
Income From Continuing Operations Excluding LIFO and Plant
Restructuring Impact, EBITDA and FIFO EBITDA
Operating income excluding LIFO and plant
restructuring, EBITDA and FIFO EBITDA are non-GAAP financial
measures. The Company believes these non-GAAP financial measures
provide a basis for comparison to companies that do not use LIFO or
have plant restructuring to enhance the understanding of the
Company’s historical operating performance. The Company does
not intend for this information to be considered in isolation or as
a substitute for other measures prepared in accordance with
GAAP.
Set forth below is a reconciliation of reported
Operating Income excluding LIFO and plant restructuring.
|
|
Quarter Ended |
|
|
In millions |
|
|
6/27/2020 |
|
6/29/2019 |
|
|
FY 2021 |
|
FY 2020 |
|
|
|
|
|
Operating income, as reported: |
$ |
30.3 |
|
$ |
2.9 |
|
|
|
|
|
LIFO (credit) charge |
|
(2.1 |
) |
|
3.2 |
|
|
|
|
|
Plant restructuring
charge |
|
0.3 |
|
|
4.8 |
|
|
|
|
|
Operating income, excluding
LIFO and plant restructuring impact |
$ |
28.5 |
|
$ |
10.9 |
|
|
|
|
|
Set forth below is a reconciliation of reported net earnings
from continuing operations to EBITDA and FIFO EBITDA (earnings
before interest, income taxes, depreciation, amortization, non-cash
charges and credits related to the LIFO inventory valuation
method). The Company does not intend for this information to be
considered in isolation or as a substitute for other measures
prepared in accordance with GAAP.
|
|
Three Months Ended |
EBITDA and FIFO EBITDA: |
|
June 27, 2020 |
|
June 29, 2019 |
|
|
(In thousands) |
|
|
|
|
|
Net earnings |
$ |
20,706 |
|
$ |
1,103 |
|
Income tax expense |
|
6,335 |
|
|
285 |
|
Interest expense, net of
interest income |
|
1,651 |
|
|
3,352 |
|
Depreciation and
amortization |
|
7,881 |
|
|
7,382 |
|
Interest amortization |
|
(69 |
) |
|
(70 |
) |
EBITDA |
|
36,504 |
|
|
12,052 |
|
LIFO (credit) charge |
|
(2,141 |
) |
|
3,176 |
|
FIFO EBITDA |
$ |
34,363 |
|
$ |
15,228 |
|
|
|
|
|
|
Forward-Looking Information
The information contained in this release
contains, or may contain, forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of
1995. These statements appear in a number of places in this
release and include statements regarding the intent, belief or
current expectations of the Company or its officers (including
statements preceded by, followed by or that include the words
“believes,” “expects,” “anticipates” or similar expressions) with
respect to various matters.
Because such statements are subject to risks and uncertainties,
actual results may differ materially from those expressed or
implied by such forward-looking statements. Investors are
cautioned not to place undue reliance on such statements, which
speak only as of the date the statements were made. Among the
factors that could cause actual results to differ materially
are:
- general economic and business conditions;
- cost and availability of commodities and other raw materials
such as vegetables, steel and packaging materials;
- transportation costs;
- climate and weather affecting growing conditions and crop
yields;
- availability of financing;
- leverage and the Company’s ability to service and reduce its
debt;
- potential impact of COVID-19 related issues at our
facilities;
- foreign currency exchange and interest rate fluctuations;
- effectiveness of the Company’s marketing and trade promotion
programs;
- changing consumer preferences;
- competition;
- product liability claims;
- the loss of significant customers or a substantial reduction in
orders from these customers;
- changes in, or the failure or inability to comply with, United
States, foreign and local governmental regulations, including
environmental and health and safety regulations; and
- other risks detailed from time to time in the reports filed by
the Company with the SEC.
Except for ongoing obligations to disclose
material information as required by the federal securities laws,
the Company does not undertake any obligation to release publicly
any revisions to any forward-looking statements to reflect events
or circumstances after the date of the filing of this report or to
reflect the occurrence of unanticipated events.
Contact: Timothy J. Benjamin, Chief Financial
Officer315-926-8100
Seneca Foods Corporation |
Unaudited Selected Financial Data |
|
|
|
|
|
For the Periods Ended June 27, 2020 and June 29, 2019 |
(In thousands of dollars, except share data) |
|
|
|
|
|
|
|
|
|
|
|
First Quarter |
|
|
Fiscal 2021 |
|
Fiscal 2020 |
|
|
|
|
|
|
Net sales |
$ |
288,165 |
|
$ |
264,925 |
|
|
|
|
|
|
|
Plant restructuring expense
(note 2) |
$ |
263 |
|
$ |
4,806 |
|
|
|
|
|
|
|
Other operating income, net
(note 3) |
$ |
145 |
|
$ |
4,827 |
|
|
|
|
|
|
|
Operating income (note
1) |
$ |
30,299 |
|
$ |
2,937 |
|
|
Loss from equity
investment |
|
676 |
|
|
- |
|
|
Other loss (income) |
|
931 |
|
|
(1,803 |
) |
|
Interest expense, net |
|
1,651 |
|
|
3,352 |
|
|
Earnings before income
taxes |
$ |
27,041 |
|
$ |
1,388 |
|
|
|
|
|
|
|
Income tax expense |
|
6,335 |
|
|
285 |
|
|
|
|
|
|
|
Net earnings |
$ |
20,706 |
|
$ |
1,103 |
|
|
|
|
|
|
|
Basic earnings per share |
$ |
2.26 |
|
$ |
0.12 |
|
|
|
|
|
|
|
Diluted earnings per
share |
$ |
2.24 |
|
$ |
0.12 |
|
|
|
|
|
|
|
Note 1: The effect of
the LIFO inventory valuation method on first quarter pre-tax
results increased operating earnings by $2,141,000 |
|
|
|
|
for the three month period ended June 27, 2020 and decreased
operating earnings by $3,176,000 for the three month period |
|
|
|
|
ended June 29, 2019. |
|
|
|
|
Note 2: The three month period
ended June 27, 2020 included a restructuring charge of $263,000
related to closing plants in the |
|
|
|
|
Northwest of which $219,000 was related to severance and $44,000
was for lease impairments. |
|
|
|
|
The three month period ended June 29, 2019 included a restructuring
charge of $4,806,000 related to closing plants in the |
|
|
|
|
Midwest and Northwest of which $2,245,000 was for accelerated
amortization of right-of-use operating lease assets,
$1,975,000 |
|
|
|
|
was mostly related to equipment moves and $586,000 was related to
severance. |
|
|
|
|
Note 3: Other operating income
for the period ended June 27, 2020 is a gain on the sale of unused
fixed assets of $534,000. The |
|
|
|
|
Company also recorded a loss of $389,000 on the disposal of
equipment from a sold Northwest plant. |
|
|
|
|
Other operating income for the period ended June 29, 2019 is a gain
on the partial sale of a plant in the Midwest of |
|
|
|
|
$4,075,000 and a gain on the sale of unused fixed assets of
$752,000. |
|
|
|
|
Note 4: The Company uses the
"two-class" method for basic earnings per share by dividing the
earnings attributable to |
|
|
|
|
common shareholders by the weighted average of common shares
outstanding during the period. |
|
|
|
|
Seneca Foods (NASDAQ:SENEA)
Historical Stock Chart
From Mar 2024 to Apr 2024
Seneca Foods (NASDAQ:SENEA)
Historical Stock Chart
From Apr 2023 to Apr 2024