Flowers Foods: Announces Accelerated Share Repurchase

Thomasville / GA. (ff) Flowers Foods Inc., one of the largest producer and marketer of fresh packaged bakery foods in the United States, announced that it has entered into an accelerated share repurchase (ASR) agreement with Deutsche Bank AG to repurchase an aggregate of 120 million USD of the company’s common stock. On an annual basis, the company expects the repurchase of shares through the ASR to have an accretive impact on earnings in the range of 0.02 USD to 0.03 USD per share. President and CEO Allen Shiver said: «The accelerated share repurchase is a further expression of confidence in Flowers’ cash flow, long-term prospects, and ability to generate additional shareholder value. Our trusted brands, experienced team, and efficient bakeries have increased our operating cash flow over the past three years by over 100 million USD, supporting investments in our business and generating strong free cash flow. As evidenced by recent dividend announcements and today’s ASR, the company is committed to enhancing total shareholder return over the long term».

About the ASR

Under the terms of the ASR, the company will repurchase 120 million USD of its common stock from Deutsche Bank with an immediate initial delivery of approximately 5.6 million shares. The final number of shares repurchased will be based on Flowers’ daily volume-weighted average stock price over the life of the transaction, less a negotiated discount. The ASR is expected to be completed by the end of the company’s second fiscal quarter, subject to certain early termination rights in the agreement. The company is funding the ASR with borrowings on its existing credit facilities and cash on hand. The ASR is being completed under the company’s existing share repurchase program, which was increased by 7.1 million shares in November 2014. Before giving effect to the ASR, there were 13.3 million shares remaining under the current authorization.