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$POST and $BOBE said that the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, with respect to $POST proposed acquisition of Bob Evans expired on Dec. 4, 2017. The expiration of the waiting period satisfies one of the closing conditions of the transaction. The transaction will close in January 2018.
During 1Q18, $BOBE's gross profit rose 17.2% to $33.4MM compared to 1Q17, while the gross profit margin rate decreased 260 bp to 30.6%. This decrease was mainly due to a higher mix of foodservice sales as a result of the acquisition of Pineland and 14.8% increase in average sow prices.
$BOBE reported 27.1% rise in its 1Q18 net sales to $109.3MM compared to $85.9MM in 1Q17. This increase was partially due to the sales driven from the recently acquired Pineland business and the sale of Bob Evans restaurant. Net income fell 23% to $7.04MM, or $0.35 per share from $9.16MM, or $0.46 per share in 1Q17. Adjusted EPS was $0.37, up 61%.
$BOBE completed the sale of Bob Evans Restaurants in 4Q17 and completed the acquisition of Pineland Farms Potato Company on May 1, 2017, reshaping the company as a pure play packaged foods business. The reported earnings for the quarter included a $155.7MM gain on the sale of restaurants and cost and adjustments associated with the sale.
$BOBE’s 4Q17 profit surged to $108.87MM or $5.39 per share from $0.58MM or $0.03 per share last year, helped by a 5% growth in sales from continuing operations. Non-GAAP EPS climbed 27.1% YoY to $0.61. Retail Side-dish and Sausage Pounds sold increased 11.5% and 9.2%, respectively. Bob Evans completed the sale of its restaurants division in 4Q17.
$BOBE reaffirmed its fiscal 2018 sales outlook of $464-476MM and EBITDA forecast of $102-108MM. It expects to record earnings of $2.06-$2.24 per share in the year. The company declared a dividend of $0.34 per share in 4Q17, payable on June 26, 2017, to stockholders of record as on June 12, 2017.
$BOBE announced the completion of sales of Bob Evans Restaurants to Golden Gate Capital and the completion of its acquisition of Pineland Farms Potato Company. Mike Townsley, President, BEF Foods, assumes the role of President and CEO of Bob Evans Farms, Inc.
In 3Q17, at $BOBE’s Bob Evans Foods segment, which now comprises continuing operations, net sales were $112.8MM, an increase of 4.6% compared to 3Q16. Pounds sold increased 7.6% while average net selling price per pound declined 2.8% compared to 3Q16.
At 3Q17-end, $BOBE’s cash balance and outstanding debt were $2.4MM and $330.1MM, respectively, versus $6.3MM and $496MM at 3Q16-end. The decrease in borrowings was primarily due to the use of proceeds from recent real estate monetization transactions and operating cash flow to reduce debt, partially offset by share repurchases, Capex and dividends.
For FY17, $BOBE raised non-GAAP diluted EPS in the range of $.22-2.32, from prior outlook of $2.15-2.30 per share, to reflect the impact of lower net sow costs and continued focus on operating efficiency. The company expects BEF Food net sales to be in the range of $390-410MM.