Diluted earnings per share from continuing operations increased 6.7% to $0.95 on a reported basis. Excluding special items, diluted EPS grew 3.1% to $0.99.
Foreign exchange had a negligible impact on this year's third-quarter results.
As Heinz first announced on January 23, 2013, the Company recorded a special charge of $12 million, or $0.04 per share, in this year's third quarter related to its earn-out payment of $60 million in cash to the previous owners of Foodstar. This early earn-out payment is intended to give Heinz additional flexibility in the future for growing its businesses in China, one of the Company's largest and most important Emerging Markets.
Discontinued OperationsDuring the third quarter of Fiscal 2013, the Heinz Board of Directors approved management's plan to divest Shanghai LongFong Foods, a frozen food business in China. The Company is committed to divesting LongFong and anticipates securing an agreement with a suitable buyer in the next 12 months. As a result, LongFong has been reclassified as a discontinued operation; previously it was reported in the Company's Asia/Pacific segment. LongFong's net assets have been classified as held for sale and the Company has recorded a $36.0 million pre-tax and after-tax non-cash goodwill impairment charge in the third quarter of Fiscal 2013, which has been recorded in discontinued operations. LongFong had reported sales of $27 million and $51 million in the nine months ended January 27, 2013 and January 25, 2012, respectively. In the first quarter of Fiscal 2013, Heinz completed the previously announced sale of its U.S. Foodservice frozen desserts business. This transaction resulted in a $32.7 million pre-tax ($21.1 million after-tax) loss, which has been recorded in discontinued operations. Including discontinued operations, Heinz reported total Company net income of $270 million and EPS of $0.83 in the latest quarter. Year-to-Date -- Continuing Operations For the nine months ended January 27, 2013, sales of $8.54 billion increased 0.5% on a reported basis and 3.7% on an organic basis. Operating income was $1.28 billion, an increase of 9.4%. Excluding special items, operating income was $1.29 billion, up 0.9%. Net income from continuing operations was $889 million, up 15.8%. Excluding special items, net income from continuing operations was $901 million, an increase of 6.8%.
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