THOMASVILLE, Ga., Aug. 10, 2023 /PRNewswire/ --
Flowers Foods, Inc. (NYSE: FLO) today reported financial results
for the company's 12-week fiscal second quarter ended July 15, 2023.
Second Quarter Summary:
Compared to the prior year second quarter where
applicable
- Sales increased 8.8% to a second quarter-record $1.228 billion.
- Net income increased 18.8% to $63.8
million. Adjusted net income(1) increased 8.8% to
$70.9 million.
- Adjusted EBITDA(1) increased 10.9% to $133.1 million, representing 10.8% of sales, a
20-basis point increase.
- Diluted EPS increased $0.05 to
$0.30. Adjusted diluted EPS(1)
increased $0.02 to $0.33.
CEO's Remarks:
"Flowers' record second quarter sales were driven by the
effectiveness of our portfolio strategy and strong execution by our
team," said Ryals McMullian, chairman, CEO, and president of
Flowers Foods. "Our Branded Retail business performed well in a
competitive environment, characterized by continued, but
moderating, consumer trade down to private label products. We're
also pleased to have grown sales and profitability in our Other
category, as price increases to mitigate inflationary pressure more
than offset business rationalizations and cost increases. To
reflect this strong second quarter performance, we are adjusting
our fiscal 2023 guidance.
"Consumers continue to seek value, though we are seeing some
early indications that they may be acclimating to higher prices and
reverting toward prior purchasing behavior. To capitalize on this
environment and spur future growth, we remain focused on bringing
new and innovative products to market and implementing initiatives
to increase productivity and efficiencies. One such growth
opportunity, the nationwide launch of our Dave's Killer
Bread Snack Bars, remains on track, and we are excited about
their potential to expand our brands into additional categories. To
drive margin improvement, we are executing on cost savings
initiatives and the deployment of our enterprise resource planning
upgrade and other digital initiatives. As always, our dedicated
Flowers team is focused on maximizing shareholder value and driving
results in line with our long-term financial targets."
For the 52-week Fiscal 2023, the Company Expects:
- Sales in the range of approximately $5.095 billion to $5.141
billion, representing an increase of approximately 6.0% to
7.0% compared to the prior year period. Prior guidance called for
sales of approximately $5.086 billion
to $5.141 billion.
- Adjusted EBITDA(2) in the range of approximately $503 million to $528
million, compared to prior guidance of $494 million to $528
million.
- Adjusted diluted EPS(2) in the range of approximately
$1.18 to $1.25, compared to prior guidance of $1.15 to $1.25.
The company's outlook is based on the following assumptions:
- Depreciation and amortization in the range of $155 million to $160
million, compared to prior guidance of $160 million to $165
million
- Net interest expense of approximately $16 million to $18
million, compared to prior guidance of $9 million to $13
million
- An effective tax rate of approximately 24%, compared to prior
guidance of approximately 25%
- Weighted average diluted share count for the year of
approximately 213 million shares
- Capital expenditures in the range of $145 million to $155
million, with $30 million to
$40 million related to the ERP
upgrade, compared to prior guidance of $140
million to $150 million
Matters Affecting Comparability:
Reconciliation of
Earnings per Share to Adjusted Earnings per Share
|
|
|
|
12-Week Period
Ended
|
|
|
12-Week Period
Ended
|
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
|
Net income per diluted
common share
|
|
$
|
0.30
|
|
|
$
|
0.25
|
|
Business process
improvement costs
|
|
|
0.02
|
|
|
|
0.04
|
|
Restructuring
charges
|
|
|
0.01
|
|
|
|
—
|
|
Acquisition-related
costs
|
|
NM
|
|
|
|
—
|
|
Severance and lease
termination
|
|
|
—
|
|
|
|
0.01
|
|
Legal
settlement
|
|
|
—
|
|
|
|
0.01
|
|
Adjusted net income per
diluted common share
|
|
$
|
0.33
|
|
|
$
|
0.31
|
|
NM - not
meaningful.
Certain amounts may
not add due to rounding.
|
Consolidated Second Quarter Operating Highlights
Compared to the prior year second quarter where
applicable
- Sales increased 8.8% to $1.228
billion, a second quarter record. Pricing/mix(3) increased
13.3%, volume(4) declined 6.1%, and the Papa Pita acquisition added
1.6%.
-
- Branded Retail sales increased $52.0
million or 7.1% to $787.8
million due to higher prices intended to offset inflationary
pressures, improved mix from greater branded organic product sales,
and the acquisition contribution, partially offset by volume
declines. Pricing/mix(3) rose 7.1%, volume(4) declined 1.5%, and
the Papa Pita acquisition added 1.5%.
- Other sales increased $47.0
million or 11.9% to $440.3
million due to substantial price increases implemented prior
to the second quarter of fiscal 2023 intended to offset
inflationary pressures, and the acquisition contribution, partially
offset by volume declines. Pricing/mix(3) rose 20.6%, volume(4)
declined 10.5%, and the Papa Pita acquisition added 1.8%.
- Materials, supplies, labor, and other production costs
(exclusive of depreciation and amortization) were 51.0% of sales, a
90-basis point decrease. These costs decreased as a percentage of
sales due to inflation-driven pricing actions more than offsetting
input cost inflation, lower production volumes, increased product
returns, and increased maintenance costs.
- Selling, distribution, and administrative (SD&A) expenses
were 38.8% of sales, in line with the prior year period. Lower
consulting costs and distributor distribution fees as a percentage
of sales were offset by greater marketing expenses, reduced scrap
dough income, and an insurance liability reserve. Excluding matters
affecting comparability, adjusted SD&A expenses were 38.2% of
sales, a 70-basis point increase, due to the factors listed above
with the exception of the consulting costs.
- Depreciation and amortization (D&A) expenses were
$35.0 million, or 2.8% of sales, a
10-basis point decrease.
- Net income increased 18.8% to $63.8
million due to all the factors mentioned above, net of
higher interest expense and effective tax rate. Adjusted net
income(1) increased 8.8% to $70.9
million.
- Adjusted EBITDA(1) increased 10.9% to $133.1 million, representing 10.8% of sales, a
20-basis point increase.
Cash Flow, Capital Allocation, and Capital Return
Year-to-date, through the end of the second quarter of fiscal
2023, cash flow from operating activities decreased by $54.9 million to $128.9
million, capital expenditures decreased $29.5 million to $68.4
million, and dividends paid to shareholders increased
$4.7 million to $98.1 million. Cash and cash equivalents were
$11.7 million at the end of the
second quarter of fiscal 2023.
(1)
|
Adjusted for items
affecting comparability. See reconciliations of non-GAAP measures
in the financial statements following this release.
|
(2)
|
No reconciliation of
the forecasted range for Adjusted diluted EPS to Diluted EPS and
adjusted EBITDA to net income for the 52-week Fiscal 2023 is
included in this press release because the company is unable to
quantify certain amounts that would be required to be included in
the GAAP measure without unreasonable efforts. In addition, the
company believes such reconciliations would imply a degree of
precision that would be confusing or misleading to
investors.
|
(3)
|
Calculated as
(current year period units X change in price per unit) / prior year
period sales dollars
|
(4)
|
Calculated as (prior
year period price per unit X change in units) / prior year period
sales dollars
|
Pre-Recorded Management Remarks and Question and Answer
Webcast
In conjunction with this release, pre-recorded
management remarks and a supporting slide presentation will be
posted to the Flowers Foods website. The company will host a live
question and answer webcast at 8:30
a.m. (Eastern) on August 11,
2023. The pre-recorded remarks and webcast will be archived
at flowersfoods.com/investors.
About Flowers Foods
Headquartered in Thomasville,
Ga., Flowers Foods, Inc. (NYSE: FLO) is one of the largest
producers of packaged bakery foods in the
United States with 2022 sales of $4.8
billion. Flowers operates bakeries across the country that
produce a wide range of bakery products. Among the company's top
brands are Nature's Own, Dave's Killer Bread,
Wonder, Canyon Bakehouse, and Tastykake. Learn more
at www.flowersfoods.com.
FLO-CORP FLO-IR
Forward-Looking Statements
Statements contained in this press release and certain other
written or oral statements made from time to time by Flowers Foods,
Inc. (the "company", "Flowers Foods", "Flowers", "us", "we", or
"our") and its representatives that are not historical facts are
forward-looking statements as defined in the Private Securities
Litigation Reform Act of 1995. Forward-looking statements relate to
current expectations regarding our business and our future
financial condition and results of operations and are often
identified by the use of words and phrases such as "anticipate,"
"believe," "continue," "could," "estimate," "expect," "intend,"
"may," "plan," "predict," "project," "should," "will," "would," "is
likely to," "is expected to" or "will continue," or the negative of
these terms or other comparable terminology. These forward-looking
statements are based upon assumptions we believe are reasonable.
Forward-looking statements are based on current information and are
subject to risks and uncertainties that could cause our actual
results to differ materially from those projected. Certain factors
that may cause actual results, performance, liquidity, and
achievements to differ materially from those projected are
discussed in our Annual Report on Form 10-K (the "Form 10-K") and
Quarterly Reports on Form 10-Q filed with the Securities and
Exchange Commission ("SEC") and may include, but are not limited
to, (a) unexpected changes in any of the following: (1) general
economic and business conditions; (2) the competitive setting in
which we operate, including advertising or promotional strategies
by us or our competitors, as well as changes in consumer demand;
(3) interest rates and other terms available to us on our
borrowings; (4) supply chain conditions and any related impact on
energy and raw materials costs and availability and hedging
counter-party risks; (5) relationships with or increased costs
related to our employees and third-party service providers; (6)
laws and regulations (including environmental and health-related
issues); and (7) accounting standards or tax rates in the markets
in which we operate, (b) the loss or financial instability of
any significant customer(s), including as a result of product
recalls or safety concerns related to our products, (c) changes in
consumer behavior, trends and preferences, including health and
whole grain trends, and the movement toward less expensive store
branded products, (d) the level of success we achieve in developing
and introducing new products and entering new markets, (e) our
ability to implement new technology and customer requirements as
required, (f) our ability to operate existing, and any new,
manufacturing lines according to schedule, (g) our ability to
implement and achieve our environmental, social, and governance
goals in accordance with regulatory requirements and expectations
of stakeholders, suppliers, and customers; (h) our ability to
execute our business strategies which may involve, among other
things, (1) the ability to realize the intended benefits of
completed, planned or contemplated acquisitions, dispositions or
joint ventures, (2) the deployment of new systems (e.g., our
enterprise resource planning ("ERP") system), distribution channels
and technology, and (3) an enhanced organizational structure (e.g.,
our sales and supply chain reorganization), (i) consolidation
within the baking industry and related industries, (j) changes in
pricing, customer and consumer reaction to pricing actions
(including decreased volumes), and the pricing environment among
competitors within the industry, (k) our ability to adjust pricing
to offset, or partially offset, inflationary pressure on the cost
of our products, including ingredient and packaging costs; (l)
disruptions in our direct-store-delivery distribution model,
including litigation or an adverse ruling by a court or regulatory
or governmental body that could affect the independent contractor
classifications of the independent distributor partners, (m)
increasing legal complexity and legal proceedings that we are or
may become subject to, (n) labor shortages and turnover or
increases in employee and employee-related costs, (o) the credit,
business, and legal risks associated with independent distributor
partners and customers, which operate in the highly competitive
retail food and foodservice industries, (p) any business
disruptions due to political instability, pandemics, armed
hostilities (including the ongoing conflict between Russia and Ukraine), incidents of terrorism, natural
disasters, labor strikes or work stoppages, technological
breakdowns, product contamination, product recalls or safety
concerns related to our products, or the responses to or
repercussions from any of these or similar events or conditions and
our ability to insure against such events, (q) the failure of our
information technology systems to perform adequately, including any
interruptions, intrusions, cyber-attacks or security breaches of
such systems or risks associated with the implementation of the
upgrade of our ERP system; and (r) the potential impact of climate
change on the company, including physical and transition risks,
availability or restriction of resources, higher regulatory and
compliance costs, reputational risks, and availability of capital
on attractive terms. The foregoing list of important factors does
not include all such factors, nor does it necessarily present
them in order of importance. In addition, you should consult other
disclosures made by the company (such as in our other filings with
the SEC or in company press releases) for other factors that may
cause actual results to differ materially from those projected by
the company. Refer to Part I, Item 1A., Risk Factors, of the Form
10-K, Part II, Item 1A., Risk Factors, of the Form 10-Q for the
quarter ended July 15, 2023 and
subsequent filings with the SEC for additional information
regarding factors that could affect the company's results of
operations, financial condition and liquidity. We caution you not
to place undue reliance on forward-looking statements, as they
speak only as of the date made and are inherently uncertain. The
company undertakes no obligation to publicly revise or update such
statements, except as required by law. You are advised, however, to
consult any further public disclosures by the company (such as in
our filings with the SEC or in company press releases) on related
subjects.
Information Regarding Non-GAAP Financial Measures
The company prepares its consolidated financial statements in
accordance with U.S. Generally Accepted Accounting Principles
(GAAP). However, from time to time, the company may present in its
public statements, press releases and SEC filings, non-GAAP
financial measures such as, EBITDA, adjusted EBITDA, adjusted
EBITDA margin, adjusted net income, adjusted diluted EPS, adjusted
income tax expense, adjusted selling, distribution and
administrative expenses (SD&A), and gross margin excluding
depreciation and amortization. The reconciliations attached provide
reconciliations of the non-GAAP measures used in this presentation
or release to the most comparable GAAP financial measure. The
company's definitions of these non-GAAP measures may differ from
similarly titled measures used by others. These non-GAAP measures
should be considered supplemental to, and not a substitute for,
financial information prepared in accordance with GAAP.
The company defines EBITDA as earnings before interest, taxes,
depreciation and amortization. Earnings are net income. The company
believes that EBITDA is a useful tool for managing the operations
of its business and is an indicator of the company's ability to
incur and service indebtedness and generate free cash flow. EBITDA
is used as the primary performance measure in the company's 2014
Omnibus Equity and Incentive Compensation Plan. Furthermore,
pursuant to the terms of our credit facility, EBITDA is used to
determine the company's compliance with certain financial
covenants. The company also believes that EBITDA measures are
commonly reported and widely used by investors and other interested
parties as measures of a company's operating performance and debt
servicing ability because EBITDA measures assist in comparing
performance on a consistent basis without regard to depreciation or
amortization, which can vary significantly depending upon
accounting methods and non-operating factors (such as historical
cost). EBITDA is also a widely-accepted financial indicator of a
company's ability to incur and service indebtedness.
EBITDA should not be considered an alternative to (a) income
from operations or net income (loss) as a measure of operating
performance; (b) cash flows provided by operating, investing and
financing activities (as determined in accordance with GAAP) as a
measure of the company's ability to meet its cash needs; or (c) any
other indicator of performance or liquidity that has been
determined in accordance with GAAP.
The company defines adjusted EBITDA, adjusted EBITDA margin,
adjusted net income, adjusted diluted EPS, adjusted income tax
expense and adjusted SD&A, respectively, to exclude additional
costs that the company considers important to present to investors.
These costs include, but are not limited to, the costs of closing a
plant or costs associated with acquisition-related activities,
certain impairment charges, legal settlements and other costs
impacting past and future comparability. The company believes that
these measures, when considered together with its GAAP financial
results, provides management and investors with a more complete
understanding of its business operating results, including
underlying trends, by excluding the effects of certain charges.
Presentation of gross margin includes depreciation and
amortization in the materials, supplies, labor and other production
costs according to GAAP. Our method of presenting gross margin
excludes the depreciation and amortization components, as discussed
above.
The reconciliations attached provide reconciliations of the
non-GAAP measures used in this presentation or release to the most
comparable GAAP financial measure.
Flowers Foods,
Inc
Condensed
Consolidated Balance Sheets
(000's
omitted)
|
|
|
|
July 15,
2023
|
|
|
December 31,
2022
|
|
Assets
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
11,711
|
|
|
$
|
165,134
|
|
Other current
assets
|
|
|
711,673
|
|
|
|
613,334
|
|
Property, plant and
equipment, net
|
|
|
961,786
|
|
|
|
849,325
|
|
Right-of-use leases,
net
|
|
|
271,892
|
|
|
|
275,214
|
|
Distributor notes
receivable (1)
|
|
|
156,978
|
|
|
|
163,354
|
|
Other
assets
|
|
|
39,190
|
|
|
|
37,008
|
|
Cost in excess of net
tangible assets, net
|
|
|
1,352,605
|
|
|
|
1,209,625
|
|
Total
assets
|
|
$
|
3,505,835
|
|
|
$
|
3,312,994
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
Current
liabilities
|
|
$
|
504,768
|
|
|
$
|
518,656
|
|
Long-term
debt
|
|
|
1,074,544
|
|
|
|
891,842
|
|
Right-of-use lease
liabilities (2)
|
|
|
281,542
|
|
|
|
282,862
|
|
Other
liabilities
|
|
|
174,907
|
|
|
|
176,344
|
|
Stockholders'
equity
|
|
|
1,470,074
|
|
|
|
1,443,290
|
|
Total liabilities and
stockholders' equity
|
|
$
|
3,505,835
|
|
|
$
|
3,312,994
|
|
|
|
|
|
|
|
|
(1)
|
Includes current
portion of $25,556 and $26,472, respectively.
|
(2)
|
Includes current
portion of $50,689 and $45,769, respectively.
|
Flowers Foods,
Inc
Consolidated
Statement of Operations
(000's omitted,
except per share data)
|
|
|
|
|
|
12-Week Period
Ended
|
|
|
12-Week Period
Ended
|
|
|
For the 28-Week
Period Ended
|
|
|
For the 28-Week
Period Ended
|
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
|
Sales
|
|
$
|
1,228,050
|
|
|
$
|
1,129,051
|
|
|
$
|
2,762,543
|
|
|
$
|
2,564,983
|
|
Materials, supplies,
labor and other production costs (exclusive of
depreciation and amortization shown separately
below)
|
|
|
626,097
|
|
|
|
586,084
|
|
|
|
1,426,949
|
|
|
|
1,310,676
|
|
Selling, distribution,
and administrative expenses
|
|
|
475,916
|
|
|
|
438,350
|
|
|
|
1,067,859
|
|
|
|
993,302
|
|
Restructuring
charges
|
|
|
2,499
|
|
|
|
—
|
|
|
|
6,694
|
|
|
|
—
|
|
Impairment of
assets
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
990
|
|
Depreciation and
amortization expense
|
|
|
34,984
|
|
|
|
32,922
|
|
|
|
78,719
|
|
|
|
76,345
|
|
Income from
operations
|
|
|
88,554
|
|
|
|
71,695
|
|
|
|
182,322
|
|
|
|
183,670
|
|
Other pension
benefit
|
|
|
(62)
|
|
|
|
(178)
|
|
|
|
(145)
|
|
|
|
(416)
|
|
Interest expense,
net
|
|
|
4,251
|
|
|
|
1,504
|
|
|
|
8,137
|
|
|
|
3,605
|
|
Income before income
taxes
|
|
|
84,365
|
|
|
|
70,369
|
|
|
|
174,330
|
|
|
|
180,481
|
|
Income tax
expense
|
|
|
20,605
|
|
|
|
16,689
|
|
|
|
39,860
|
|
|
|
41,212
|
|
Net income
|
|
$
|
63,760
|
|
|
$
|
53,680
|
|
|
$
|
134,470
|
|
|
$
|
139,269
|
|
Net income per diluted
common share
|
|
$
|
0.30
|
|
|
$
|
0.25
|
|
|
$
|
0.63
|
|
|
$
|
0.65
|
|
Diluted weighted
average shares outstanding
|
|
|
213,009
|
|
|
|
213,307
|
|
|
|
213,538
|
|
|
|
213,315
|
|
Flowers Foods,
Inc
Condensed
Consolidated Statement of Cash Flows
(000's
omitted)
|
|
|
|
|
|
12-Week Period
Ended
|
|
|
12-Week Period
Ended
|
|
|
For the 28-Week
Period Ended
|
|
|
For the 28-Week
Period Ended
|
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
63,760
|
|
|
$
|
53,680
|
|
|
$
|
134,470
|
|
|
$
|
139,269
|
|
Adjustments to
reconcile net income to net cash from operating
activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
non-cash adjustments
|
|
|
42,381
|
|
|
|
44,283
|
|
|
|
105,356
|
|
|
|
108,952
|
|
Changes
in assets and liabilities
|
|
|
(35,186)
|
|
|
|
(38,284)
|
|
|
|
(110,919)
|
|
|
|
(64,388)
|
|
Net cash provided by
operating activities
|
|
|
70,955
|
|
|
|
59,679
|
|
|
|
128,907
|
|
|
|
183,833
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase
of property, plant and equipment
|
|
|
(34,427)
|
|
|
|
(47,365)
|
|
|
|
(68,385)
|
|
|
|
(97,862)
|
|
Proceeds
from sale of property, plant and equipment
|
|
|
679
|
|
|
|
144
|
|
|
|
775
|
|
|
|
1,575
|
|
Acquisition of business
|
|
|
(4,304)
|
|
|
|
—
|
|
|
|
(274,755)
|
|
|
|
—
|
|
Investment in unconsolidated affiliate
|
|
|
(1,981)
|
|
|
|
(9,000)
|
|
|
|
(1,981)
|
|
|
|
(9,000)
|
|
Other
|
|
|
2,871
|
|
|
|
5,006
|
|
|
|
5,977
|
|
|
|
12,177
|
|
Net cash disbursed
for investing activities
|
|
|
(37,162)
|
|
|
|
(51,215)
|
|
|
|
(338,369)
|
|
|
|
(93,110)
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends
paid
|
|
|
(49,023)
|
|
|
|
(46,700)
|
|
|
|
(98,123)
|
|
|
|
(93,447)
|
|
Stock
repurchases
|
|
|
(15,263)
|
|
|
|
(6,465)
|
|
|
|
(26,244)
|
|
|
|
(16,514)
|
|
Net
change in debt borrowings
|
|
|
11,000
|
|
|
|
—
|
|
|
|
182,000
|
|
|
|
—
|
|
Payments
on financing leases
|
|
|
(453)
|
|
|
|
(438)
|
|
|
|
(1,052)
|
|
|
|
(864)
|
|
Other
|
|
|
3,937
|
|
|
|
2,503
|
|
|
|
(542)
|
|
|
|
(3,258)
|
|
Net cash (disbursed
for) provided by financing activities
|
|
|
(49,802)
|
|
|
|
(51,100)
|
|
|
|
56,039
|
|
|
|
(114,083)
|
|
Net decrease in cash
and cash equivalents
|
|
|
(16,009)
|
|
|
|
(42,636)
|
|
|
|
(153,423)
|
|
|
|
(23,360)
|
|
Cash and cash
equivalents at beginning of period
|
|
|
27,720
|
|
|
|
205,147
|
|
|
|
165,134
|
|
|
|
185,871
|
|
Cash and cash
equivalents at end of period
|
|
$
|
11,711
|
|
|
$
|
162,511
|
|
|
$
|
11,711
|
|
|
$
|
162,511
|
|
Flowers Foods,
Inc
Sales by Sales
Class and Sales Bridge
(000's
omitted)
Sales by Sales
Class
|
|
|
12-Week Period
Ended
|
|
|
12-Week Period
Ended
|
|
|
|
|
|
|
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
|
|
$ Change
|
|
|
% Change
|
|
Branded
Retail
|
|
$
|
787,765
|
|
|
$
|
735,728
|
|
|
$
|
52,037
|
|
|
|
7.1
|
%
|
Other
|
|
|
440,285
|
|
|
|
393,323
|
|
|
|
46,962
|
|
|
|
11.9
|
%
|
Total
Sales
|
|
$
|
1,228,050
|
|
|
$
|
1,129,051
|
|
|
$
|
98,999
|
|
|
|
8.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the 28-Week
Period
Ended
|
|
|
For the 28-Week
Period
Ended
|
|
|
|
|
|
|
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
|
|
$ Change
|
|
|
% Change
|
|
Branded
Retail
|
|
$
|
1,767,268
|
|
|
$
|
1,691,266
|
|
|
$
|
76,002
|
|
|
|
4.5
|
%
|
Other
|
|
|
995,275
|
|
|
|
873,717
|
|
|
|
121,558
|
|
|
|
13.9
|
%
|
Total
Sales
|
|
$
|
2,762,543
|
|
|
$
|
2,564,983
|
|
|
$
|
197,560
|
|
|
|
7.7
|
%
|
|
Sales Bridge
|
For the 12-week period ended July 15,
2023
|
|
Branded Retail
|
|
|
Other
|
|
|
Total
|
|
Pricing/mix*
|
|
|
7.1
|
%
|
|
|
20.6
|
%
|
|
|
13.3
|
%
|
Volume*
|
|
|
(1.5)
|
%
|
|
|
(10.5)
|
%
|
|
|
(6.1)
|
%
|
Acquisition
|
|
|
1.5
|
%
|
|
|
1.8
|
%
|
|
|
1.6
|
%
|
Total percentage point change in
sales
|
|
|
7.1
|
%
|
|
|
11.9
|
%
|
|
|
8.8
|
%
|
|
For the 28-week period ended July 15,
2023
|
|
Branded Retail
|
|
|
Other
|
|
|
Total
|
|
Pricing/mix*
|
|
|
7.8
|
%
|
|
|
21.9
|
%
|
|
|
13.5
|
%
|
Volume*
|
|
|
(4.2)
|
%
|
|
|
(9.2)
|
%
|
|
|
(6.8)
|
%
|
Acquisition
|
|
|
0.9
|
%
|
|
|
1.2
|
%
|
|
|
1.0
|
%
|
Total percentage point change in
sales
|
|
|
4.5
|
%
|
|
|
13.9
|
%
|
|
|
7.7
|
%
|
|
|
|
|
|
|
|
|
|
|
* Computations above are calculated as
follows:
|
Price/Mix $ = Current
year period units × change in price per unit
|
Price/Mix % =
Price/Mix $ ÷ Prior year period Sales $
|
|
|
|
|
|
|
|
|
|
Volume $ = Prior year
period price per unit × change in units
|
Volume % = Volume $ ÷
Prior year period Sales $
|
Flowers Foods,
Inc
Reconciliation of
GAAP to Non-GAAP Measures
(000's omitted,
except per share data)
|
|
|
|
|
|
Reconciliation of
Earnings per Share to Adjusted Earnings per Share
|
|
|
|
12-Week Period
Ended
|
|
|
12-Week Period
Ended
|
|
|
For the 28-Week
Period Ended
|
|
|
For the 28-Week
Period Ended
|
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
|
Net income per diluted
common share
|
|
$
|
0.30
|
|
|
$
|
0.25
|
|
|
$
|
0.63
|
|
|
$
|
0.65
|
|
Business process
improvement costs
|
|
|
0.02
|
|
|
|
0.04
|
|
|
|
0.05
|
|
|
|
0.07
|
|
Impairment of
assets
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
NM
|
|
Restructuring
charges
|
|
|
0.01
|
|
|
|
—
|
|
|
|
0.02
|
|
|
|
—
|
|
Acquisition-related
costs
|
|
NM
|
|
|
|
—
|
|
|
|
0.01
|
|
|
|
—
|
|
Severance and lease
termination
|
|
|
—
|
|
|
|
0.01
|
|
|
|
—
|
|
|
|
0.01
|
|
Legal
settlement
|
|
|
—
|
|
|
|
0.01
|
|
|
|
—
|
|
|
|
0.01
|
|
Adjusted net income per
diluted common share
|
|
$
|
0.33
|
|
|
$
|
0.31
|
|
|
$
|
0.71
|
|
|
$
|
0.74
|
|
NM - not
meaningful
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Gross Margin
|
|
|
|
12-Week Period
Ended
|
|
|
12-Week Period
Ended
|
|
|
For the 28-Week
Period Ended
|
|
|
For the 28-Week
Period Ended
|
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
|
Sales
|
|
$
|
1,228,050
|
|
|
$
|
1,129,051
|
|
|
$
|
2,762,543
|
|
|
$
|
2,564,983
|
|
Materials, supplies,
labor and other production costs (exclusive
of depreciation and amortization)
|
|
|
626,097
|
|
|
|
586,084
|
|
|
|
1,426,949
|
|
|
|
1,310,676
|
|
Gross margin excluding
depreciation and amortization
|
|
|
601,953
|
|
|
|
542,967
|
|
|
|
1,335,594
|
|
|
|
1,254,307
|
|
Less depreciation and
amortization for production activities
|
|
|
19,259
|
|
|
|
18,167
|
|
|
|
43,707
|
|
|
|
41,601
|
|
Gross margin
|
|
$
|
582,694
|
|
|
$
|
524,800
|
|
|
$
|
1,291,887
|
|
|
$
|
1,212,706
|
|
Depreciation and
amortization for production activities
|
|
$
|
19,259
|
|
|
$
|
18,167
|
|
|
$
|
43,707
|
|
|
$
|
41,601
|
|
Depreciation and
amortization for selling, distribution, and
administrative activities
|
|
|
15,725
|
|
|
|
14,755
|
|
|
|
35,012
|
|
|
|
34,744
|
|
Total depreciation and
amortization
|
|
$
|
34,984
|
|
|
$
|
32,922
|
|
|
$
|
78,719
|
|
|
$
|
76,345
|
|
|
|
|
|
Reconciliation of
Selling, Distribution, and Administrative Expenses to
Adjusted SD&A
|
|
|
|
12-Week Period
Ended
|
|
|
12-Week Period
Ended
|
|
|
For the 28-Week
Period Ended
|
|
|
For the 28-Week
Period
Ended
|
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
|
Selling, distribution,
and administrative expenses
(SD&A)
|
|
$
|
475,916
|
|
|
$
|
438,350
|
|
|
$
|
1,067,859
|
|
|
$
|
993,302
|
|
Business process
improvement costs
|
|
|
(6,588)
|
|
|
|
(11,658)
|
|
|
|
(12,807)
|
|
|
|
(20,722)
|
|
Legal
settlement
|
|
|
—
|
|
|
|
(2,000)
|
|
|
|
—
|
|
|
|
(2,000)
|
|
Acquisition-related
costs
|
|
|
(489)
|
|
|
|
—
|
|
|
|
(3,712)
|
|
|
|
—
|
|
Severance and lease
termination
|
|
|
—
|
|
|
|
(1,717)
|
|
|
|
—
|
|
|
|
(1,717)
|
|
Adjusted
SD&A
|
|
$
|
468,839
|
|
|
$
|
422,975
|
|
|
$
|
1,051,340
|
|
|
$
|
968,863
|
|
Flowers Foods,
Inc
Reconciliation of
GAAP to Non-GAAP Measures
(000's omitted,
except per share data)
|
|
|
|
Reconciliation of
Net Income to EBITDA and Adjusted EBITDA
|
|
|
|
12-Week Period
Ended
|
|
|
12-Week Period
Ended
|
|
|
For the 28-Week
Period Ended
|
|
|
For the 28-Week
Period Ended
|
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
|
Net income
|
|
$
|
63,760
|
|
|
$
|
53,680
|
|
|
$
|
134,470
|
|
|
$
|
139,269
|
|
Income tax
expense
|
|
|
20,605
|
|
|
|
16,689
|
|
|
|
39,860
|
|
|
|
41,212
|
|
Interest expense,
net
|
|
|
4,251
|
|
|
|
1,504
|
|
|
|
8,137
|
|
|
|
3,605
|
|
Depreciation and
amortization
|
|
|
34,984
|
|
|
|
32,922
|
|
|
|
78,719
|
|
|
|
76,345
|
|
EBITDA
|
|
|
123,600
|
|
|
|
104,795
|
|
|
|
261,186
|
|
|
|
260,431
|
|
Other pension
benefit
|
|
|
(62)
|
|
|
|
(178)
|
|
|
|
(145)
|
|
|
|
(416)
|
|
Business process
improvement costs
|
|
|
6,588
|
|
|
|
11,658
|
|
|
|
12,807
|
|
|
|
20,722
|
|
Impairment of
assets
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
990
|
|
Restructuring
charges
|
|
|
2,499
|
|
|
|
—
|
|
|
|
6,694
|
|
|
|
—
|
|
Acquisition-related
costs
|
|
|
489
|
|
|
|
—
|
|
|
|
3,712
|
|
|
|
—
|
|
Severance and lease
termination
|
|
|
—
|
|
|
|
1,717
|
|
|
|
—
|
|
|
|
1,717
|
|
Legal
settlement
|
|
|
—
|
|
|
|
2,000
|
|
|
|
—
|
|
|
|
2,000
|
|
Adjusted
EBITDA
|
|
$
|
133,114
|
|
|
$
|
119,992
|
|
|
$
|
284,254
|
|
|
$
|
285,444
|
|
Sales
|
|
$
|
1,228,050
|
|
|
$
|
1,129,051
|
|
|
$
|
2,762,543
|
|
|
$
|
2,564,983
|
|
Adjusted EBITDA
margin
|
|
|
10.8
|
%
|
|
|
10.6
|
%
|
|
|
10.3
|
%
|
|
|
11.1
|
%
|
|
|
|
|
|
|
Reconciliation of
Income Tax Expense to Adjusted Income Tax Expense
|
|
|
|
12-Week Period
Ended
|
|
|
12-Week Period
Ended
|
|
|
For the 28-Week
Period Ended
|
|
|
For the 28-Week
Period
Ended
|
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
|
Income tax
expense
|
|
$
|
20,605
|
|
|
$
|
16,689
|
|
|
$
|
39,860
|
|
|
$
|
41,212
|
|
Tax impact
of:
|
|
|
|
|
|
|
|
|
|
|
|
|
Business process
improvement costs
|
|
|
1,647
|
|
|
|
2,915
|
|
|
|
3,202
|
|
|
|
5,181
|
|
Impairment of
assets
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
248
|
|
Restructuring
charges
|
|
|
624
|
|
|
|
—
|
|
|
|
1,673
|
|
|
|
—
|
|
Acquisition-related
costs
|
|
|
122
|
|
|
|
—
|
|
|
|
928
|
|
|
|
—
|
|
Severance and lease
termination
|
|
|
—
|
|
|
|
429
|
|
|
|
—
|
|
|
|
429
|
|
Legal
settlement
|
|
|
—
|
|
|
|
500
|
|
|
|
—
|
|
|
|
500
|
|
Adjusted income tax
expense
|
|
$
|
22,998
|
|
|
$
|
20,533
|
|
|
$
|
45,663
|
|
|
$
|
47,570
|
|
Flowers Foods,
Inc
Reconciliation of
GAAP to Non-GAAP Measures
(000's omitted,
except per share data)
|
|
|
Reconciliation of
Net Income to Adjusted Net Income
|
|
|
12-Week Period
Ended
|
|
|
12-Week Period
Ended
|
|
|
For the 28-Week
Period Ended
|
|
|
For the 28-Week
Period Ended
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
|
|
July 15,
2023
|
|
|
July 16,
2022
|
Net income
|
|
$
|
63,760
|
|
|
$
|
53,680
|
|
|
$
|
134,470
|
|
|
$
|
139,269
|
Business process
improvement costs
|
|
|
4,941
|
|
|
|
8,743
|
|
|
|
9,605
|
|
|
|
15,541
|
Impairment of
assets
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
742
|
Restructuring
charges
|
|
|
1,875
|
|
|
|
—
|
|
|
|
5,021
|
|
|
|
—
|
Acquisition-related
costs
|
|
|
367
|
|
|
|
—
|
|
|
|
2,784
|
|
|
|
—
|
Severance and lease
termination
|
|
|
—
|
|
|
|
1,288
|
|
|
|
—
|
|
|
|
1,288
|
Legal
settlement
|
|
|
—
|
|
|
|
1,500
|
|
|
|
—
|
|
|
|
1,500
|
Adjusted net
income
|
|
$
|
70,943
|
|
|
$
|
65,211
|
|
|
$
|
151,880
|
|
|
$
|
158,340
|
|
|
Reconciliation of
Earnings per Share -
Full Year Fiscal 2023 Guidance
|
|
|
Range
Estimate
|
Net income per diluted
common share
|
|
$
|
1.10
|
|
to
|
$
|
1.17
|
Business process
improvement costs
|
|
|
0.05
|
|
|
|
0.05
|
Restructuring
charges
|
|
|
0.02
|
|
|
|
0.02
|
Acquisition-related
costs
|
|
|
0.01
|
|
|
|
0.01
|
Adjusted net income per
diluted common share
|
|
$
|
1.18
|
|
to
|
$
|
1.25
|
View original
content:https://www.prnewswire.com/news-releases/flowers-foods-inc-reports-second-quarter-2023-results-301898272.html
SOURCE Flowers Foods, Inc.