2. “Forward-Looking Statements”
During this discussion Company management may make forward looking
statements within the meaning of applicable securities laws. The statements
may include projections regarding future earnings and results which are based
upon the Company’s current expectations and assumptions, which are subject to
a number of risks and uncertainties. Factors that could cause actual results to
differ, including price competition and industry consolidation, increases in costs
or availability of ingredients, product price increases impact on total revenue,
risks from large customers, changes in consumer preferences, implementation of
a new information system, product recalls or safety concerns, food industry and
regulatory factors, acquisition and divestiture risks, ability to execute strategic
initiatives, interest rate, foreign exchange rate and credit risks, natural disasters
or catastrophic events and current economic conditions are discussed in the
Company’s most recent Form 10-K filed with the Securities and Exchange
Commission.
2
3. 1st Quarter 2009
Financial Review
Rick Puckett
Executive Vice President
& Chief Financial Officer
5. Q1 2009 Net Sales Summary
(Unaudited)
Q1 2009 2009 vs. 2008
Branded $ 127.2 $ 5.7 4.8%
Non Branded 88.6 12.1 15.8%
Total Net Sales $ 215.8 $ 17.8 9.0%
($ in millions)
5
6. Gross Margin Trend
(Unaudited)
43.9% 43.4%43.0% 43.6% 44.5%
41.6%
42.0% 37.2%
37.6%
43.5% 43.6%
43.1%
42.7%
42.8% 42.6%
39.4% 39.1%
43.1% 37.4%
41.7%
36.6%
40.3%
38.1%
38.5% 37.8%
37.2%
Q1-2006 Q2-2006 Q3-2006 Q4-2006 Q1-2007 Q2-2007 Q3-2007 Q4-2007 Q1-2008 Q2-2008 Q3-2008 Q4-2008* Q1-2009
Quarterly Trailing 4 Quarters
* Q4 2008 data excludes special items. For a corresponding reconciliation of Q4 2008 data excluding special items to Q4
2008 data including special items, see the reconciliation of non-GAAP measures in the Appendix. 6
7. SG&A % of Net Sales
(Unaudited)
42.3%
39.5% 39.2% 39.4%
38.8%
38.2%
38.3%
37.0% 37.5% 37.2%
36.8% 36.8%
37.7% 36.4%
36.3% 36.0% 35.7%
35.5% 35.6%
34.7%
34.9%
34.1%
34.1%
33.0%
33.5%
32.1%
Q1-2006 Q2-2006 Q3-2006 Q4-2006 Q1-2007 Q2-2007 Q3-2007 Q4-2007 Q1-2008 Q2-2008 Q3-2008 Q4-2008* Q1-2009
Quarterly Trailing 4 Quarters
* Q4 2008 data excludes special items. For a corresponding reconciliation of Q4 2008 data excluding special items to Q4
2008 data including special items, see the reconciliation of non-GAAP measures in the Appendix. 7
8. Operating Profit** Margin Trend
(Unaudited)
8.2%
6.4% 6.4%
6.1%
5.6% 5.5% 5.4%
6.4% 6.3%
5.0%
5.7% 4.5%
5.4%
4.6%
4.3%
2.5%
4.2%
3.6%
3.4% 3.3%
3.3%
1.5% 2.8% 2.4%
0.8%
-0.3%
Q1-2006 Q2-2006 Q3-2006 Q4-2006 Q1-2007 Q2-2007 Q3-2007 Q4-2007 Q1-2008 Q2-2008 Q3-2008 Q4-2008* Q1-2009
Quarterly Trailing 4 Quarters
* Q4 2008 data excludes special items. For a corresponding reconciliation of Q4 2008 data excluding special items to Q4
2008 data including special items, see the reconciliation of non-GAAP measures in the Appendix.
** Operating profit percentage is a non-GAAP measure. For a corresponding reconciliation of operating profit percentage to
the most comparable GAAP measure, see the reconciliation of non-GAAP in the Appendix. 8
9. Q1 2009 Financial Summary
(Unaudited)
Q1 2009 Q1 2008
Net Sales $ 215.8 $ 198.0
Gross Margin % 39.1% 37.6%
SG&A Expense % 34.1% 36.8%
Operating Profit %* 5.0% 0.8%
Tax Rate 35.6% 38.5%
Net Income $ 6.5 $ 0.6
Diluted EPS $ 0.20 $ 0.02
* Operating profit percentage is a non-GAAP measure. For a corresponding reconciliation of operating profit percentage to
the most comparable GAAP measure, see the reconciliation of non-GAAP measures in the Appendix.
($ in millions, except for per share amounts)
9
10. Key 1st Quarter Statistics
(Unaudited)
Trailing 4 Quarters
Q1 2009 Q1 2008
EBITDA* $ 74.0 $ 60.5
EBITDA* % of Sales 8.5% 7.8%
NET DEBT** (quarter-end) $ 109.6 $ 73.6
(Total Debt less Cash)
NET DEBT/EBITDA 1.5 1.2
* Excluding special items. EBITDA is a non-GAAP measure. For a corresponding reconciliation of EBITDA to the most
comparable GAAP measure, see the reconciliation of non-GAAP measures in the Appendix.
** Net Debt is a non-GAAP measure. For a corresponding reconciliation of Net Debt to the most comparable GAAP
measure, see the reconciliation of non-GAAP measures in the Appendix.
($ in millions)
10
12. 2009 Full Year Estimates
Net Sales $910 - $930
Diluted Earnings Per Share $1.10 - $1.20
Capital Spending $41 - $46
($ in millions, except for per share amounts)
12
14. 1st Quarter Review
Record First Quarter revenues
Peanut butter recall impacting revenue and earnings
Archway integration on track
New product launches
New advertising campaign
Continued supply chain & DSD improvements
Clear focus for remainder of year
14
17. Reconciliation of Non-GAAP
Measures
This presentation includes certain measures not derived in accordance
with generally accepted accounting principles (“GAAP”). Such
measures should not be considered substitutes for any measures
derived in accordance with GAAP and may also be inconsistent with
similar measures presented by other companies. Reconciliation of
these non-GAAP financial measures to the most nearly comparable
GAAP measures, if applicable, is presented on the slides that follow.
The Company believes these non-GAAP financial measures provide
useful information to investors as the measures emphasize core on-
going operations and are helpful in comparing past and present
operating results. The Company uses these measures to evaluate
past performance and prospects for future performance. The
presentation of non-GAAP financial measures by the Company should
not be considered in isolation or as a substitute for the Company’s
financial results prepared in accordance with GAAP.
17
18. Reconciliation of Non-GAAP
Measures: Special Items
(Unaudited) Q4 2008 Q4 2008
Including Special Excluding
Special Items Items Special Items
Net Sales $ 215.3 $ - $ 215.3
COGS $ 131.3 $ 0.9 $ 130.5
Gross Margin $ 84.0 $ (0.9) $ 84.8
Gross Margin % 39.0% 39.4%
SG&A $ 71.9 $ 0.8 $ 71.1
SG&A % 33.4% 33.0%
Other (income)/expense, net $ (0.5) $ 0.3 $ (0.8)
Income from continuing operations
before interest and income taxes $ 12.5 $ (1.9) $ 14.5
Interest expense, net $ 0.9 $ 0.0 $ 0.8
Income from continuing operations
before income taxes $ 11.7 $ (2.0) $ 13.6
Income tax expense $ 4.1 $ (0.7) $ 4.8
Income tax rate 35.3% 35.2%
Net income from continuing operations $ 7.5 $ (1.3) $ 8.8
Weighted average shares outstanding -
diluted (in millions) 32.0 32.0 32.0
Diluted earnings per share $ 0.24 $ (0.04) $ 0.28
18
($ in millions, except for per share amounts)
19. Reconciliation of Non-GAAP
Measures: Special Items
(Unaudited) Full Yr. 2008 Full Yr. 2008
Including Special Excluding
Special Items Items Special Items
Net Sales $ 852.5 $ - $ 852.5
COGS $ 531.5 $ 0.9 $ 530.7
Gross Margin $ 320.9 $ (0.9) $ 321.8
Gross Margin % 37.6% 37.8%
SG&A $ 291.7 $ 0.8 $ 290.9
SG&A % 34.2% 34.1%
Other (income)/expense, net $ (0.9) $ 0.3 $ (1.1)
Income from continuing operations
before interest and income taxes $ 30.1 $ (1.9) $ 32.1
Interest expense, net $ 3.0 $ 0.0 $ 3.0
Income from continuing operations
before income taxes $ 27.1 $ (2.0) $ 29.1
Income tax expense $ 9.4 $ (0.7) $ 10.1
Income tax rate 34.6% 34.6%
Net income from continuing operations $ 17.7 $ (1.3) $ 19.0
Weighted average shares outstanding -
diluted (in millions) 31.8 31.8 31.8
Diluted Earnings per share $ 0.56 $ (0.04) $ 0.60
19
($ in millions, except for per share amounts)
20. Reconciliation of Non-GAAP
Measures: Operating Profit
(Unaudited)
Q1 Q1
2009 2008
Income before interest & income taxes $ 10.8 $ 1.7
Add Back
Other expense, net $ 0.1 $ -
Equals
Operating Profit $ 10.9 $ 1.7
Net Sales $ 215.8 $ 198.0
5.0% 0.8%
Operating Profit % of Net Sales
($ in millions)
20
21. Reconciliation of Non-GAAP
Measures: EBITDA
(Unaudited)
Trailing 4 Quarters
Q1 2009 Q1 2008
Income from continuing operations
before interest and income taxes $ 39.3 $ 30.3
Special items included in income from
continuing operations before interest
and income taxes $ (1.9) $ -
Add Back
Depreciation & amortization $ 32.8 $ 30.3
Equals
EBITDA excluding special items $ 74.0 $ 60.5
Net sales $ 870.3 $ 778.3
EBITDA excluding special
items % of Net sales 8.5% 7.8%
($ in millions)
21
22. Reconciliation of Non-GAAP
Measures: Net Debt
(Unaudited)
Q1 2009 Q1 2008
Long-term Debt $ 112.0 $ 74.7
Less
Cash & Cash Equivalents $ 2.4 $ 1.2
$ 109.6 $ 73.6
Net Debt (quarter-end)
($ in millions)
22
23. Reconciliation of Non-GAAP
Measures: Operating Profit Trend
(Unaudited)
Q1-06 Q2-06 Q3-06 Q4-06 Q1-07 Q2-07 Q3-07 Q4-07 Q1-08 Q2-08 Q3-08 Q4-08 Q1-09
Income from continuing operations
before interest & taxes $ (0.8) $ 10.1 $ 12.2 $ 9.8 $ 9.9 $ 15.2 $ 11.6 $ 1.9 $ 1.7 $ 5.2 $ 10.7 $ 12.5 $ 10.8
Special items included in income
from continuing operations before
interest & taxes $ (1.9)
Add Back
Other (income)/expense, net $ 0.2 $ 0.5 $ (0.2) $ (0.2) $ (0.1) $ 1.0 $ 0.5 $ 1.0 $ (0.0) $ 0.2 $ (0.5) $ (0.5) $ 0.1
Special items included in other
(income)/expense, net $ 0.3
Equals
Operating profit excluding
special items $ (0.6) $ 10.6 $ 12.0 $ 9.5 $ 9.8 $ 16.1 $ 12.1 $ 2.9 $ 1.7 $ 5.4 $ 10.2 $ 13.7 $ 10.9
Net sales $ 180.7 $ 188.3 $ 188.6 $ 172.4 $ 182.4 $ 197.0 $ 198.1 $ 185.2 $ 198.0 $ 213.6 $ 225.6 $ 215.3 $ 215.8
Operating profit excluding special
Items % of Net sales -0.3% 5.6% 6.4% 5.5% 5.4% 8.2% 6.1% 1.5% 0.8% 2.5% 4.5% 6.4% 5.0%
($ in millions)
23
