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Acquisitions (Tables)

12 Months Ended

Dec. 28, 2013

Summary of Potential Payment of Holdback Amount

The table below reflects the potential payments to us under each scenario (amounts in thousands):

		February 23, 2013 – November 20, 2013				November 21, 2013 – February 18, 2014				February 19, 2014 – May 19, 2014				May 20, 2014 – August 17, 2014
Co-pack decision		$	10,000			$	7,500			$	5,000			$	—
Bakery decision		$	10,000			$	10,000			$	7,500			$	5,000

Fair Value of Stock Consideration

The table below outlines the determination of fair value and provides the assumptions used in the calculation:

Restriction lapse year		2012				2013				2014				2015				2016				Total
Value of Flowers shares issued (thousands)		$	25,000			$	10,000			$	5,000			$	5,000			$	5,000			$	50,000
Implied fair value of restricted shares (thousands)		$	23,626			$	9,154			$	4,447			$	4,363			$	4,297			$	45,887
Exercise price (per share)		$	13.65			$	13.65			$	13.65			$	13.65			$	13.65
Expected term (yrs)			0.37				1.00				2.00				3.00				4.00
Volatility (%)			25.0	%			25.0	%			25.0	%			25.0	%			25.0	%
Risk-free rate (%)			0.1	%			0.2	%			0.2	%			0.3	%			0.4	%
Dividend yield (%)			3.0	%			3.0	%			3.0	%			3.0	%			3.0	%

Pro Forma Consolidated Results of Operations

Unaudited pro forma consolidated results of operations for the Sara Lee California and Earthgrains asset acquisitions are not included because the company determined that they are immaterial. Hostess filed for bankruptcy and ceased operations in November 2012 (the “Hostess Shutdown”). As a result, there were no sales related to the Acquired Hostess Assets for fiscal 2013 because of the Hostess Shutdown and, as a result, there is no data to include in the pro forma presentation below (amounts in thousands, except per share data):

		For Fiscal
		2013				2012				2011
Sales:
As reported		$	3,751,005			$	3,046,491			$	2,773,356
Pro forma		$	3,751,005			$	3,902,864			$	2,995,233
Net income:
As reported		$	230,894			$	136,121			$	123,428
Pro forma		$	227,076			$	128,464			$	128,022
Basic net income per common share:
As reported		$	1.11			$	0.66			$	0.61
Pro forma		$	1.09			$	0.62			$	0.62
Diluted net income per common share:
As reported		$	1.09			$	0.66			$	0.60
Pro forma		$	1.07			$	0.61			$	0.61

Acquired Hostess Bread Asset

Schedule of Identified Assets Acquired and Liabilities Assumed

The following table summarizes the consideration paid for the Acquired Hostess Bread Assets and liabilities assumed based on the estimated fair value at the acquisition date (amounts in thousands and are preliminary):

Fair value of consideration transferred:
Cash consideration transferred		$	355,342
Recognized amounts of identifiable assets acquired and liabilities assumed:
Property, plant, and equipment		$	160,673
Identifiable intangible asset — trademarks			189,000
Financial assets			1,650
Net recognized amounts of identifiable assets acquired		$	351,323
Gain on legal settlement			(1,400	)
Net recognized amounts of identifiable assets acquired and gain on settlement		$	349,923
Goodwill		$	5,419

Sara Lee and Earthgrains acquisition of trademark licenses

Schedule of Identified Assets Acquired and Liabilities Assumed

The following table summarizes the consideration paid to acquire these licenses and the amounts of identified assets acquired and liabilities assumed based on the estimated fair value at the acquisition date (amounts in thousands and are preliminary):

Fair value of consideration transferred:
Cash consideration transferred		$	49,950
Contingently refundable consideration (the “holdback”)			(7,600	)
Total consideration, net		$	42,350
Recognized amounts of identifiable assets acquired and liabilities assumed:
Property, plant, and equipment		$	6,476
Identifiable intangible asset — distribution rights			25,790
Identifiable intangible asset — trademarks			79,500
Identifiable intangible asset — customer relationships			12,000
Deferred income taxes, net			(31,345	)
Net recognized amounts of identifiable assets acquired		$	92,421
Bargain purchase gain		$	50,071

Lepage Bakeries Inc

Schedule of Identified Assets Acquired and Liabilities Assumed

The following table summarizes the consideration transferred to acquire Lepage and the amounts of identified assets acquired and liabilities assumed based on the fair value at the acquisition date (amounts in thousands):

Fair value of consideration transferred:
Cash		$	318,605
Deferred payment obligations			17,663
Flowers Foods, Inc. common stock			45,887
Total fair value of consideration transferred		$	382,155
Recognized amounts of identifiable assets acquired and liabilities assumed:
Financial assets		$	11,658
Inventories			4,537
Property, plant, and equipment			59,970
Assets held for sale — Distributor routes			16,098
Identifiable intangible assets			256,400
Deferred income taxes, net			(1,137	)
Financial liabilities			(17,076	)
Net recognized amounts of identifiable assets acquired		$	330,450
Goodwill		$	51,705

Schedule of Intangible Assets Subject to Amortization

The following table presents the intangible assets subject to amortization (amounts in thousands, except amortization periods):

		Amount				Weighted average amortization years
Customer relationships		$	69,000				25.0
Non-compete agreements			2,400				4.0
		$	71,400				24.3

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Tabular disclosure of pro forma results of operations for a material business acquisition or series of individually immaterial business acquisitions that are material in the aggregate.

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