Nov. 9, 2018 | Earnings Reports
Highlights (vs. year-ago, second quarter results):
- The Company has applied discontinued operations treatment as related to its Modesto operations during the second quarter of fiscal 2019.
- Included in the second fiscal year 2019 quarter net earnings from discontinued operations is a $24.2 million non-cash gain as a result of the Modesto LIFO layer liquidation.
- Net continuing sales decreased $7.0 million or 2.1% as compared to the prior year quarter. A decrease in sales volume of $10.0 million was partially offset by higher selling prices/mix of $3.0 million. The sales volume decrease is primarily from a reduction in B&G Foods Inc. sales and is partially offset by an increase in other canned vegetable sales.
- Gross margin percentage from continuing operations income decreased from 6.6% to 3.4% as compared to the prior year quarter. Lower sales volume, cost increases, and an increase in the LIFO charge all contributed to the lower gross margin percentage.
- During the second quarter of fiscal 2019 the Company has met the criteria to classify certain operating units as assets held for sale.
“As we anticipated, we have sold the Modesto facility subsequent to the quarter end and are in the process of completing the orderly liquidation of the Modesto operations. We are expecting a third quarter pre-tax gain on the sale of the Modesto facility of approximately $53.9 million. Continuing operations results are lagging behind the prior year primarily due to higher steel and transportation costs,” stated Kraig Kayser, President and Chief Executive Officer.