Snyder’s-Lance: Reports Results for Full Year 2013

Charlotte / NC. (li) Snyder´s-Lance Inc. reported results for its fiscal year 2013. Net revenue for the year ended December 28, 2013, was 1,76 billion USD, an increase of 8,8 percent from prior year net revenue of 1,62 billion USD, primarily driven by sales of our core brands. Consistent with our long term guidance of three percent to five percent, organic net revenue growth for the full year was four percent. The Company realized full year net income of 81,3 million USD, excluding special items or 1,16 USD per diluted share, as compared to full year 2012 net income of 66,1 million USD, excluding special items or 0,95 USD per diluted share, an increase of 22 percent. Net income, including special items, was 78,7 million USD or 1,12 USD per diluted share, for the full year 2013 compared to 59,1 million USD or 0,85 USD per diluted share for 2012, an increase of 33 percent. Full year 2013 net income was negatively impacted by an increased effective tax rate of 36,8 percent compared to 34,7 percent for full year 2012. This higher than normal effective tax rate reduced 2013 earnings per share by approximately 0,04 USD when compared to last year´s effective tax rate.

Special items for 2013 totalled 2,6 million USD, after tax expense and included approximately 1,6 million USD income in gain on the sale of assets, approximately 1,2 million USD of impairment charges and approximately 3,0 million USD of self-funded medical expense. Special items for 2012 were 7,0 million USD, after tax expense and included approximately 2,6 million USD in severance costs and professional fees related to merger and integration activities, approximately 6,6 million USD in asset impairment charges, approximately 4,9 million USD in charges related to consolidation activities and approximately 1,2 million USD in expenses associated with the acquisition of Snack Factory. Special items for 2012 also included gains on the sale of route businesses of approximately 8,3 million USD, net of the incremental taxes incurred on these gains.

Fourth quarter 2013 net revenue was 451 million USD, an increase of 7,4 percent compared to prior year fourth quarter net revenue of 420 million USD, primarily led by sales of our core brands which grew organically by 6,8 percent. Fourth quarter 2013 net income was 22,2 million USD, excluding special items, which was 8,8 percent above the 20,4 million USD of net income, excluding special items, for the prior year. Net income including special items was 23,0 million USD for the fourth quarter 2013 compared to fourth quarter 2012 net income including special items of 7,8 million USD. Fourth quarter 2013 net income was negatively impacted by the higher than normal effective tax rate mentioned above.

Comments from Management

«During this past year we grew earnings by 22 percent excluding special items and grew our sales by nine percent», commented Carl E. Lee, Jr., President and Chief Executive Officer. «For 2013, we saw strong growth in our core branded items with solid distribution gains and share growth. Organically, core brands grew 5,4 percent, as we continued to invest in quality, capacity and innovation. Our overall operating margin increased in 2013 by 70 basis points, thanks to our team´s execution of our strategic plan. We increased our investment in advertising and marketing by over 20 percent from the prior year to support building our brands. In 2013 we strengthened our position as a leader in premium, differentiated snacks and are excited about the potential of 2014».

Lee continued, «Looking ahead, our team has worked hard to build a strong innovation pipeline for 2014 to drive core brand growth with unique value-added products. We expect to continue improving our operating margin in the coming year while also significantly increasing our investment in advertising and marketing to support core brand growth. Our primary goals of emphasizing our core brands, growing sales across the entire product portfolio, expanding our DSD network and controlling costs to widen margins are on target. We continue to look for branded products and distribution opportunities to build on this great foundation we´ve put in place. In 2014, plans call for growing our business consistent with consumer trends, supported by our expanding «better for you» product portfolio. I´d like to thank everyone at Snyder´s-Lance for a solid 2013 and look forward to an exciting and productive 2014».

Dividend Declared

The Company also announced the declaration of a quarterly cash dividend of 0,16 USD per share on the Company´s common stock. The dividend is payable on March 05, 2014 to stockholders of record at the close of business on February 26, 2014.

Estimates provided for 2014

The Company estimates that its net revenue for the full year 2014 will be up three percent to five percent organically when compared to 2013. Earnings per diluted share are expected to increase between ten percent and 16 percent compared to 2013 earnings per diluted share, excluding special items. Capital expenditures for 2014 are projected to be between 70 USD and 75 million USD as investments are made in plant improvements, quality, capacity and innovation.