Additional information regarding EBITDA, and a reconciliation of EBITDA to net income and to net cash provided by operating activities is included below for the third quarter and first three quarters of 2012 and 2011, along with the components of EBITDA. Also included below are reconciliations of the non-GAAP terms adjusted net income and adjusted diluted earnings per share to reported net income and reported diluted earnings per share.

About B&G Foods, Inc.

B&G Foods and its subsidiaries manufacture, sell and distribute a diversified portfolio of high-quality, shelf-stable foods across the United States, Canada and Puerto Rico. B&G Foods’ products include hot cereals, fruit spreads, canned meats and beans, spices, seasonings, marinades hot sauces, wine vinegar, maple syrup, molasses, salad dressings, Mexican-style sauces, taco shells and kits, salsas, pickles, peppers and other specialty food products. B&G Foods competes in the retail grocery, food service, specialty, private label, club and mass merchandiser channels of distribution. Based in Parsippany, New Jersey, B&G Foods’ products are marketed under many recognized brands, including Ac’cent, B&G, B&M, Baker’s Joy, Brer Rabbit, Cream of Rice, Cream of Wheat, Don Pepino, Emeril’s, Grandma’s Molasses, Joan of Arc, Las Palmas, Maple Grove Farms of Vermont, Molly McButter, Mrs. Dash, Ortega, Polaner, Red Devil, Regina, Sa-són, Sclafani, Sugar Twin, Trappey’s, Underwood, Vermont Maid and Wright’s. B&G Foods also sells and distributes two branded household products, Static Guard and Kleen Guard.

Forward-Looking Statements

Statements in this press release that are not statements of historical or current fact constitute “forward-looking statements.” The forward-looking statements contained in this press release include, without limitation, statements related to B&G Foods’ EBITDA expectations for fiscal 2012; the planned acquisition of the New York Style and Old London brands and the timing thereof; the expected impact of the planned acquisition, including without limitation the expected impact on B&G Foods’ earnings per share and free cash flow; and the use of proceeds of the common stock offering. Such forward-looking statements involve known and unknown risks, uncertainties and other unknown factors that could cause the actual results of B&G Foods to be materially different from the historical results or from any future results expressed or implied by such forward-looking statements. In addition to statements that explicitly describe such risks and uncertainties readers are urged to consider statements labeled with the terms “believes,” “belief,” “expects,” “projects,” “intends,” “anticipates” or “plans” to be uncertain and forward-looking. The forward-looking statements contained herein are also subject generally to other risks and uncertainties that are described from time to time in B&G Foods’ filings with the Securities and Exchange Commission, including under Item 1A, “Risk Factors” in the Company’s most recent Annual Report on Form 10-K for fiscal 2011 filed on February 28, 2012 and in its subsequent reports on Form 10-Q and 8-K. Investors are cautioned not to place undue reliance on any such forward looking statements, which speak only as of the date they are made. B&G Foods undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

B&G Foods, Inc. and Subsidiaries

Consolidated Balance Sheets

(In thousands, except share and per share data)

Assets September 29, 2012 December 31, 2011
Current assets:
Cash and cash equivalents $ 15,350 $ 16,738
Trade accounts receivable, net 41,124 39,476
Inventories 107,236 85,234
Prepaid expenses 2,723 4,551
Income tax receivable 3,383 2,529
Deferred income taxes   1,855     1,696  
Total current assets 171,671 150,224
Property, plant and equipment, net of accumulated depreciation of $97,299 and $89,856 62,241 61,930
Goodwill 262,977 262,827
Other intangibles, net 628,455 634,522
Other assets   20,386     23,420  
Total assets $ 1,145,730   $ 1,132,923  
Liabilities and Stockholders’ Equity
Current liabilities:
Trade accounts payable $ 29,308 $ 24,427
Accrued expenses 19,174 26,719
Current portion of long-term debt 15,375 9,750
Dividends payable   13,065     10,971  
Total current liabilities 76,922 71,867
Long-term debt 698,019 710,357
Other liabilities 6,890 9,409
Deferred income taxes   117,180     105,743  
Total liabilities 899,011 897,376
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.01 par value per share. Authorized 1,000,000 shares; no shares issued or outstanding
Common stock, $0.01 par value per share. Authorized 125,000,000 shares; 48,387,225 and 47,700,132 shares issued and outstanding as of September 29, 2012 and December 31, 2011 484 477
Additional paid-in capital 120,953 159,916
Accumulated other comprehensive loss (10,003 ) (10,430 )
Retained earnings   135,285     85,584  
Total stockholders’ equity   246,719     235,547  
Total liabilities and stockholders’ equity $ 1,145,730   $ 1,132,923  

B&G Foods, Inc. and Subsidiaries

Consolidated Statements of Operations

(In thousands, except per share data)

Thirteen Weeks Ended Thirty-nine Weeks Ended
September 29,     October 1, September 29,     October 1,
2012 2011 2012 2011
Net sales $ 154,155 $ 133,010 $ 460,106 $ 393,868
Cost of goods sold   98,876   91,560   296,246   265,382
Gross profit 55,279 41,450 163,860 128,486
Operating expenses:
Selling, general and administrative expenses 14,937 12,725 46,206 41,069
Amortization expense   2,022   1,637   6,067   4,913
Operating income 38,320 27,088 111,587 82,504
Other expenses:
Interest expense, net   11,994   8,323   35,845   24,854
Income before income tax expense 26,326 18,765 75,742 57,650
Income tax expense   9,429   6,681   26,041   19,662
Net income $ 16,897 $ 12,084   49,701   37,988
Weighted average shares outstanding:
Basic 48,387 47,822 48,267 47,903
Diluted 48,743 48,479 48,597 48,574
Earnings per share:
Basic $ 0.35 $ 0.25 $ 1.03 $ 0.79
Diluted $ 0.35 $ 0.25 $ 1.02 $ 0.78
Cash dividends declared per share $ 0.27 $ 0.21 $ 0.81 $ 0.63

B&G Foods, Inc. and Subsidiaries

Reconciliation of EBITDA to Net Income and to Net Cash Provided by Operating Activities

(In thousands)

Thirteen Weeks Ended Thirty-nine Weeks Ended
September 29,     October 1, September 29,     October 1,
2012 2011 2012 2011
Net income $ 16,897 $ 12,084 $ 49,701 $ 37,988
Income tax expense 9,429 6,681 26,041 19,662
Interest expense, net (1) 11,994 8,323 35,845 24,854
Depreciation and amortization 4,529 4,038 13,443 11,964
Loss on extinguishment of debt                
EBITDA (2) 42,849 31,126 125,030 94,468
Income tax expense (9,429 ) (6,681 ) (26,041 ) (19,662 )
Interest expense, net (11,994 ) (8,323 ) (35,845 ) (24,854 )
Deferred income taxes 4,345 2,527 10,967 12,647
Amortization of deferred financing costs and bond discount 1,257 500 3,771 1,500
Realized gain on interest rate swap (612 )
Reclassification to net interest expense for interest rate swap 423 1,270
Share-based compensation expense 871 825 2,900 2,697
Excess tax benefits from share-based compensation (43 ) (8,031 ) (1,117 )
Changes in assets and liabilities   (16,160 )   (7,285 )   (19,255 )   (27,044 )
Net cash provided by operating activities $ 11,696   $ 13,112   $ 53,496   $ 39,293  


Net interest expense in the first three quarters of 2011 includes a benefit of $0.6 million relating to the realized gain on an interest rate swap, and in the third quarter and first three quarters of 2011, a charge for the reclassification of the amount recorded in accumulated other comprehensive loss related to the swap of $0.4 million and $1.3 million, respectively.


EBITDA is a non-GAAP financial measure used by management to measure operating performance. A non-GAAP financial measure is defined as a numerical measure of our financial performance that excludes or includes amounts so as to be different than the most directly comparable measure calculated and presented in accordance with GAAP in our consolidated balance sheets and related consolidated statements of operations, comprehensive income, changes in stockholders’ equity and cash flows. We define EBITDA as net income before net interest expense, income taxes, depreciation and amortization and loss on extinguishment of debt. Management believes that it is useful to eliminate net interest expense, income taxes, depreciation and amortization and loss on extinguishment of debt because it allows management to focus on what it deems to be a more reliable indicator of ongoing operating performance and our ability to generate cash flow from operations. We use EBITDA in our business operations, among other things, to evaluate our operating performance, develop budgets and measure our performance against those budgets, determine employee bonuses and evaluate our cash flows in terms of cash needs. We also present EBITDA because we believe it is a useful indicator of our historical debt capacity and ability to service debt and because covenants in our credit agreement and our senior notes indenture contain ratios based on this measure. As a result, internal management reports used during monthly operating reviews feature the EBITDA metric. However, management uses this metric in conjunction with traditional GAAP operating performance and liquidity measures as part of its overall assessment of company performance and liquidity and therefore does not place undue reliance on this measure as its only measure of operating performance and liquidity.
EBITDA is not a recognized term under GAAP and does not purport to be an alternative to operating income or net income as an indicator of operating performance or any other GAAP measure. EBITDA is not a complete net cash flow measure because EBITDA is a measure of liquidity that does not include reductions for cash payments for an entity’s obligation to service its debt, fund its working capital, capital expenditures and acquisitions and pay its income taxes and dividends. Rather, EBITDA is a potential indicator of an entity’s ability to fund these cash requirements. EBITDA is not a complete measure of an entity’s profitability because it does not include costs and expenses for depreciation and amortization, interest and related expenses, loss on extinguishment of debt and income taxes. Because not all companies use identical calculations, this presentation of EBITDA may not be comparable to other similarly titled measures of other companies. However, EBITDA can still be useful in evaluating our performance against our peer companies because management believes this measure provides users with valuable insight into key components of GAAP amounts.

B&G Foods, Inc. and Subsidiaries

Items Affecting Comparability — Reconciliation of Adjusted Information to GAAP Information

(In thousands)

Thirteen Weeks Ended Thirty-nine Weeks Ended
September 29,     October 1, September 29,     October 1,
2012 2011 2012 2011
Reported net income $ 16,897 $ 12,084 $ 49,701 $ 37,988

Non-cash adjustments on interest rate swap, net of tax (1)




Adjusted net income $ 16,897 $ 12,354 $ 49,701 $ 38,408
Adjusted diluted earnings per share $ 0.35 $ 0.25 $ 1.02 $ 0.79



The first three quarters of 2011 includes a realized gain on interest rate swap of $0.6 million and in the third quarter and first three quarters of 2011, a reclassification from accumulated other comprehensive loss to interest expense, net on interest rate swap of $0.4 million and $1.3 million, respectively.

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