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B&G Foods, Inc. (NYSE:BGS) today announced financial results for the third quarter and first three quarters of 2013.
Highlights (vs. year-ago quarter where applicable):
Net sales increased 17.6% to $181.4 million
Net income decreased 9.2% to $15.4 million due to loss on extinguishment of debt and acquisition related transaction costs of $3.4 million, net of tax
Adjusted net income * increased 10.8% to $18.7 million
Adjusted EBITDA * increased 7.3% to $46.0 million
Adjusted EBITDA guidance remains at $187.0 million to $191.0 million for the full year
David L. Wenner, President and Chief Executive Officer of B&G Foods, stated, “Our business saw continued strong growth in net sales, net income and adjusted EBITDA during the third quarter. Putting acquisition growth aside, our base business net sales followed industry trends and declined for the quarter. Given current trends in the packaged foods industry, we expect growth in our base business to be challenging during the fourth quarter of 2013. We are taking actions to improve sales trends in our base business through new product introductions and selected pricing adjustments and are confident base business net sales will rebound and return to our more typical modest growth during 2014. Meanwhile, our recent acquisitions in snacks appear to be more on trend with changing consumer consumption patterns and we expect significant growth from
New York Style and
TrueNorth in fourth quarter 2013 and beyond.”
Please see “About Non-GAAP Financial Measures and Items Affecting Comparability” below for the definition of the terms adjusted net income, adjusted diluted earnings per share, EBITDA and adjusted EBITDA, as well as information concerning certain items affecting comparability and reconciliations of the non-GAAP terms adjusted net income, adjusted diluted earnings per share, EBITDA and adjusted EBITDA to the most comparable GAAP financial measures.
Financial Results for the Third Quarter of 2013
Net sales for the third quarter of 2013 increased 17.6% to $181.4 million from $154.2 million for the third quarter of 2012. Net sales of Pirate Brands, which B&G Foods acquired at the beginning of July 2013, contributed $16.5 million to the overall increase, net sales of the
New York Style and
Old London brands, which B&G Foods acquired at the end of October 2012, contributed $11.4 million to the overall increase, and net sales of the
TrueNorth brand, which B&G Foods acquired at the beginning of May 2013, contributed $5.4 million to the overall increase. Net sales for B&G Foods’ base business decreased $6.1 million, or 3.9%, attributable to a net price decrease of $3.5 million and a unit volume decrease of $2.6 million.
Gross profit for the third quarter of 2013 increased 10.8% to $61.3 million from $55.3 million in the third quarter of 2012. Gross profit expressed as a percentage of net sales decreased 2.1 percentage points to 33.8% for the third quarter of 2013 from 35.9% in the third quarter of 2012. The decrease in gross profit expressed as a percentage of net sales was primarily attributable to a net price decrease of $3.5 million, and a sales mix shift to lower margin products. Operating income decreased 1.9% to $37.6 million for the third quarter of 2013, from $38.3 million in the third quarter of 2012.