EX-99 2 ex998k061306.htm EARNINGS PRESS RELEASE JUNE 13, 2006 Earnings Press Release June 13, 2006
 
June 13, 2006                       FOR IMMEDIATE RELEASE
                                Contact: Philip Paras, CFO
                (315-926-8100)


PRESS RELEASE
 
    Seneca Foods Corporation reported net sales for the fiscal year ended March 31, 2006, totaling $883,823,000 versus $864,274,000 for the prior year. The current year’s net earnings were a record $21,993,000 or $1.96 per diluted share, compared with $7,907,000 or $.70 per diluted share, last year. The current year’s earnings performance is the highest in its 57-year history.
    For the quarter ended March 31, 2006, net sales totaled $166,806,000 versus $171,255,000 for the comparable period last year. The current quarter’s net earnings were $8,950,000 or $.80 per diluted share as compared with $2,473,000, or $.23 per diluted share, last year.
    Seneca Foods Corporation is primarily a vegetable processing company with manufacturing facilities located throughout the United States. Its products are sold under the Libby’sÒ, Aunt Nellie’s Farm KitchenÒ, Stokely’sÒ, READÒ, and SenecaÒ labels as well as through the private label and industrial markets. In addition, under an alliance with General Mills Operations, Inc., a successor to the Pillsbury Company and a subsidiary of General Mills, Inc., Seneca produces canned and frozen vegetables, which are sold by General Mills Operations, Inc. under the Green GiantÒ label. Seneca’s common stock is traded on the Nasdaq National Stock Market under the symbols “SENEA” and “SENEB”.
 
 

 
 
 
 
Seneca Foods Corporation
              
Unaudited Condensed Consolidated Statements of Net Earnings
              
               
For the Periods Ended March 31, 2006 and 2005
              
(In thousands of dollars, except share data)
              
               

 
 
  
Quarter
    
 
  
Annual
  
 
2006
 
2005
 
2006
 
2005
               
Net sales
$ 166,806
 
$ 171,255
 
$ 883,823
 
$ 864,274
               
Plant restructuring expense (notes 1 and 2)
$ (169)
 
$ (1,255)
 
$ (1,920)
 
$ (7,678)
               
Operating income
$ 19,092
 
$ 7,033
 
$ 52,357
 
$ 24,868
Other (expense) income, net (notes 3 and 4)
(273)
 
381
 
(1,115)
 
3,757
Interest expense (net)
3,937
 
4,289
 
15,784
 
16,592
Earnings before income taxes
$ 14,882
 
$ 3,125
 
$ 35,458
 
$ 12,033
               
Income taxes
5,932
 
652
 
13,465
 
4,126
               
Net earnings
$ 8,950
 
$ 2,473
 
$ 21,993
 
$ 7,907
               
Earnings applicable to common stock (note 5)
$ 5,490
 
$ 1,489
 
$ 13,448
 
$ 4,758
 
 
 
 
 
 
 
 
Basic earnings per share
$ 0.80
 
$ 0.23
 
$ 1.97
 
$ 0.71
               
Diluted earnings per share
$ 0.80
 
$ 0.23
 
$ 1.96
 
$ 0.70
               
Weighted average shares outstanding basic
6,829,331
 
6,714,497
 
6,810,661
 
6,714,472
               
Weighted average shares outstanding diluted
6,896,721
 
6,781,887
 
6,878,051
 
6,781,862

Note 1: Plant restructuring expense in the current year period of $1,920,000 principally includes a provision for future lease
              payments of $1,306,000, a cash severance charge of $369,000, and a non-cash impairment charge of $79,000.
              These charges involve the phase out of a labeling operation at a leased distribution center in the Northwestern US.
Note 2: Plant restructuring expense in the prior year period of $7,678,000 includes a non-cash impairment charge $6,952,000
             and a cash severance charge of $726,000. These charges involved the closure of three processing facilities
             including a green bean plant in upstate New York and corn plants in Wisconsin and Washington. In addition,
             the Company restructured the newly acquired Payette, Idaho facility through the removal of canned meat
             production to focus exclusively on dry beans.
Note 3: Other expense (net) in the current quarter of $273,000 includes a non-cash charge of $143,000 for deferred financing costs
              related to a reduction in the Company's revolving credit facility from $125 million to $100 million.
Note 4: Other expense (net) in the current year period of $1,115,000 consists of a $1,938,000 non-cash loss on the disposal of
              property and equipment, a gain on the sale of real estate of $966,000 and a non-cash charge of $143,000 for deferred
              financing costs related to a reduction in the Company's revolving credit facility from $125 million to $100 million.
             Other income in the prior year period of $3,757,000 represents the net effect of a $3,862,000 gain on the sale of Moog Inc. stock,
             a non-cash charge of $712,000 in deferred financing costs related to a reduction in the Company's revolving credit
             facility from $200 million to $125 million and a $607,000 gain on the sale of assets.
Note 5: The Company uses the "two-class" method for basic earnings per share by dividing the earnings allocated to common shareholders
              by the weighted average of common shares outstanding during the period. The diluted earnings per share includes the effect
              of convertible shares for the each period presented. Average common and participating shares totaled 11,126,181 for the year ended
              March 31, 2006.