PURSUING SALE OF IDAHO FARM
The Company announced today it is pursuing a sale of its Idaho organic dairy farm, to allow its Horizon Organic business to focus on what it does best - processing, marketing and distributing great-tasting, high-quality Horizon milk and dairy products. As a result, the Company reclassified the related assets as held for sale and recorded a $7.4 million non-cash write down to reflect the estimated fair value. The related non-cash charge is excluded from adjusted results. The Company intends to use the proceeds from any sale to reduce indebtedness and other general corporate purposes. Historically, approximately 5% of the Company’s milk supply has come from this farm. Horizon will remain steadfast in its commitment to organic dairy and focused on growing the category.
The Company expects continued growth of its Plant-based Foods and Beverages and Coffee Creamers and Beverages platforms in the fourth quarter. Due to the impact of the private label exit and contract discontinuation, the Company anticipates sales in its Premium Dairy platform to be flat on a year over year basis in the fourth quarter. Overall the Company expects a sales growth rate in the high single digits for the fourth quarter, and consistent with previous guidance, the Company expects a high single digit growth rate for the full year 2013.Driven by continued topline growth, management anticipates an adjusted total operating income growth rate in the mid to high-teens for the fourth quarter 2013. On a full year basis for 2013, the Company now expects an adjusted total operating income growth rate in the mid to high-teens. The Company continues to estimate approximately $55 million in corporate costs for full year 2013, and maintains its capital expenditures forecast in a range of $150 million to $160 million for 2013. Management anticipates a tax rate of approximately 33 percent to 34 percent for the fourth quarter.