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Diamond Foods Reports First Quarter Fiscal Year 2014 Financial Results

Stocks in this article: DMND

SAN FRANCISCO, Dec. 5, 2013 (GLOBE NEWSWIRE) -- Diamond Foods, Inc. (Nasdaq:DMND) ("Diamond") today reported financial results for its fiscal 2014 first quarter ended October 31, 2013.

First Quarter Fiscal 2014 Highlights

  • Net sales decreased 9.2% to $234.7 million
  • Snacks sales increased 1.2% to $112.6 million and Nuts sales decreased 17.1% to $122.1 million
  • Gross margin was 24.7% compared to 22.7%
  • Net loss was $42.2 million and non-GAAP net income was $5.0 million
  • Adjusted EBITDA decreased 6.1% to $29.1 million

(All comparisons above are to the first quarter fiscal year 2013. Non-GAAP financial measures are reconciled in the tables below)

"Our first quarter financial results were in line with our expectations and reflect the headwinds we anticipated from lower walnut supply and Emerald re-launch costs," said Brian Driscoll, President and CEO. "We continue to focus on gross margin improvement strategies as well as investing in brand building and innovation as we seek to achieve long-term sustainable growth. Looking ahead, we expect to benefit from the improved foundation of our business, and remain confident that we are on track to achieve earnings improvement in fiscal 2014."

First Quarter Fiscal 2014

Net sales decreased 9.2% to $234.7 million compared to $258.5 million in the prior year period and gross profit as a percent of net sales was 24.7% compared to 22.7% last year.

Net loss was $42.2 million, or a loss of $1.92 per share on a fully diluted basis. During the quarter, Diamond incurred $23.5 million in expenses for the mark to market adjustments related to shares issuable in connection with the settlement of the securities class action lawsuit, a $5.0 million expense associated with the Company's estimated future impact from a potential resolution of the Securities and Exchange Commission investigation and a $17.0 million charge related to a change in the fair value of the Oaktree warrant liability. Excluding these charges, non-GAAP net income for the first quarter was $5.0 million and non-GAAP fully diluted earnings per share was $0.18. Adjusted EBITDA was $29.1 million compared to $31.0 million in the prior year period. Adjusted EBITDA is a non-GAAP financial measure. Please refer to the tables in this press release for a reconciliation of all non-GAAP financial measures.

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