COLUMBUS, Ohio, April 26, 2012 /PRNewswire/ -- Lancaster Colony Corporation (Nasdaq: LANC) today reported results for the company's third fiscal quarter ended March 31, 2012. Highlights of the quarter:
-- Net sales increased seven percent to $271 million versus $253 million in the third quarter last year, reflecting strong sales growth in the Specialty Foods segment. -- Net income totaled $18,222,000 compared with $19,441,000 for the corresponding quarter a year ago, primarily reflecting higher costs experienced within the Specialty Foods segment. Third quarter net income per diluted share totaled $.67 compared to $.71 a year ago. -- Specialty Foods sales increased nine percent to a third quarter record of $237 million on higher volume and pricing. Both retail and foodservice sales volumes improved, with this year's earlier Easter helping retail sales. Pricing contributed approximately half the quarter's increase in sales. The segment's operating income totaled $29.6 million compared to $31.7 million in the third quarter last year. Increased material, freight and marketing costs were only partially offset by improved pricing. -- Glassware and Candles sales declined four percent to $34 million on lower candle volume. However, the segment's operating income increased to $1.0 million from $0.7 million in the third quarter last year. Modest pricing improvement and a better sales mix helped offset lower sales. -- The company's balance sheet remained strong with no debt outstanding at March 31, 2012, and $168 million in cash and equivalents. -- The quarterly cash dividend was continued at the higher level of $.36 per share set last quarter.
For the nine months ended March 31, 2012, net sales were $857 million compared to $834 million a year ago. Net income was $69,853,000, or $2.56 per diluted share. Net income for the nine months last year totaled $77,071,000, or $2.77 per diluted share. Current year-to-date net income included pretax income of $2.7 million (six cents per share after taxes) from a second-quarter distribution received under the Continued Dumping and Subsidy Offset Act (CDSOA). In the prior year, net income included a pretax CDSOA distribution of $1.0 million (two cents per share after taxes).
John B. Gerlach, Jr., chairman and CEO, said, "We were pleased with the improvement in Specialty Foods sales, given the widely reported challenges faced by consumers. Our quarterly results were affected by the timing of certain marketing expenditures, as well as higher material and freight costs."
Looking ahead, Mr. Gerlach added, "We anticipate that retail food sales during our fiscal fourth quarter will be affected by the earlier Easter timing and continued economic pressures on consumers. Our Specialty Foods segment should benefit from ongoing success with recent retail product introductions, somewhat higher average pricing, lower marketing costs and less unfavorable commodity cost comparisons. In a seasonally slower fourth quarter, our Glassware and Candles segment will likely experience a continuation of third quarter trends. We believe that throughout fiscal 2012 we have maintained a solid base upon which to build further growth in fiscal 2013."
Conference Call on the Web
The company's third quarter conference call is scheduled for this morning, April 26, at 10:00 a.m. ET. You may access the call through a live webcast by using the link provided on the company's Internet home page at www.lancastercolony.com. Replays of the webcast will be made available on the company website.
About the Company
Lancaster Colony Corporation is a diversified manufacturer and marketer of consumer products focusing primarily on specialty foods for the retail and foodservice markets.
We desire to take advantage of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 (the "PSLRA"). This news release contains various "forward-looking statements" within the meaning of the PSLRA and other applicable securities laws. Such statements can be identified by the use of the forward-looking words "anticipate," "estimate," "project," "believe," "intend," "plan," "expect," "hope" or similar words. These statements discuss future expectations; contain projections regarding future developments, operations or financial conditions; or state other forward-looking information. Such statements are based upon assumptions and assessments made by us in light of our experience and perception of historical trends, current conditions, expected future developments; and other factors we believe to be appropriate. These forward-looking statements involve various important risks, uncertainties and other factors that could cause our actual results to differ materially from those expressed in the forward-looking statements. Actual results may differ as a result of factors over which we have no, or limited, control. Management believes these forward-looking statements to be reasonable; however, you should not place undue reliance on such statements that are based on current expectations. For example, fluctuations in material and freight costs, over which we have limited control, may significantly influence our financial results. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update such forward-looking statements, except as required by law. More detailed statements regarding significant events that could affect our financial results are included in our Annual Report on Form 10-K and Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission and are available on our website at www.lancastercolony.com.
LANCASTER COLONY CORPORATION CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (In thousands except per-share amounts) Three Months Ended Nine Months Ended March 31, March 31, 2012 2011 2012 2011 Net sales $271,098 $252,623 $857,400 $833,912 Cost of sales 217,296 200,089 678,309 645,063 Gross margin 53,802 52,534 179,091 188,849 Selling, general & administrative expenses 25,848 23,060 74,915 72,441 Operating income 27,954 29,474 104,176 116,408 Interest income and other - net 39 54 2,774 1,110 Income before income taxes 27,993 29,528 106,950 117,518 Taxes based on income 9,771 10,087 37,097 40,447 Net income $18,222 $19,441 $69,853 $77,071 Net income per common share:(a) Net income - basic and diluted $.67 $.71 $2.56 $2.77 Cash dividends per common share $.36 $.33 $1.05 $.96 Weighted average common shares outstanding: Basic 27,216 27,494 27,237 27,755 Diluted 27,251 27,520 27,268 27,781 (a) Based on the weighted average number of shares outstanding during each period.
LANCASTER COLONY CORPORATION BUSINESS SEGMENT INFORMATION (Unaudited) (In thousands) Three Months Ended Nine Months Ended March 31, March 31, 2012 2011 2012 2011 NET SALES Specialty Foods $237,432 $217,436 $740,604 $692,539 Glassware and Candles 33,666 35,187 116,796 141,373 $271,098 $252,623 $857,400 $833,912 OPERATING INCOME Specialty Foods $29,561 $31,664 $109,510 $121,025 Glassware and Candles 973 676 2,272 5,044 Corporate expenses (2,580) (2,866) (7,606) (9,661) $27,954 $29,474 $104,176 $116,408
LANCASTER COLONY CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands) March 31, June 30, 2012 2011 ASSETS Current assets: Cash and equivalents $167,960 $132,266 Receivables - net of allowance for doubtful accounts 86,495 63,762 Total inventories 100,284 111,885 Deferred income taxes and other current assets 24,021 25,283 Total current assets 378,760 333,196 Net property, plant and equipment 184,017 185,282 Other assets 103,297 103,611 Total assets $666,074 $622,089 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $43,489 $42,570 Accrued liabilities 37,360 33,586 Total current liabilities 80,849 76,156 Other noncurrent liabilities and deferred income taxes 32,695 28,394 Shareholders' equity 552,530 517,539 Total liabilities and shareholders' equity $666,074 $622,089
SOURCE Lancaster Colony Corporation