Revenues increase 40% to IR(pound)90 million ($109.4 million)
190% increase in Net Assets significantly strengthening Balance Sheet
Hibernia Foods plc (Nasdaq:HIBNY, HIBZF, HIBWF; the “Company”) today announced its results for its fiscal year and fourth quarter ended March 31, 2000.
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Sales for the fiscal year were IR(pound)90.01 million ($109.41 million), an increase of 40% compared to sales of IR(pound)64.24 million ($78.09 million) for fiscal 1999.
For the fiscal year, the operating loss amounted to IR(pound)2.61 million ($3.18 million) compared to an operating loss of IR(pound)2.20 million ($2.67 million) for fiscal 1999. Included in the operating loss figure are certain set-up and commissioning costs with respect to the new ready-meals facility which shall not occur again. Management estimate that the gross set-up and commissioning costs incurred amounted to approximately IR(pound)800,000 or almost $1 million. Furthermore recruitment, salary and other costs related to the new management structures were incurred during fiscal 2000 as well as a substantial expensed investment in new products development, the benefits of which shall be reflected in fiscal 2001.
During fiscal 2000 Hibernia divided its business into three separate and focused divisions – frozen desserts, frozen ready-meals and Entenmann’s, and recruited experienced senior management teams for each division. This process culminated in the appointment of Mr. Paul Simmonds as Chief Executive (UK) in February of this year. Mr. Simmonds was the former Chief Executive of Glanbia UK a value-added food company with revenues of approximately stg(pound)250 million ($ 400 million).
As discussed below, the Company also completed a major financing transaction which is anticipated to result in annual interest savings of approximately IR(pound)5.3 million ($6.5 million) from April of fiscal 2001, and which has significantly improved the Company’s balance sheet.
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By GlobalDataAfter deducting interest and similar charges of IR(pound)7.78 million ($9.46 million) for the fiscal year, the net loss amounted to IR(pound)10.40 million ($12.64 million) compared to a net loss of IR(pound)7.91 million ($9.94 million) for fiscal 1999, which amounts to a loss per share of IR(pound)1.22 ($1.48) compared to IR(pound)1.10 ($1.34) for fiscal 1999.
Commenting on the results, Oliver Murphy, Chairman and Chief Executive Officer, said “I am extremely pleased that we achieved record revenue growth during Fiscal 2000. Ignoring the impact of acquisitions, revenue growth across our three divisions – frozen desserts, frozen ready-meals and Entenmann’s – was of double digit proportions, and I am confident that we will show major revenue increases in fiscal 2001 which will flow down to our bottom line as the fixed element of our overhead base remains relatively constant.”
Mr. Murphy continued, “Fiscal 2000 was a year in which we invested heavily in production and personnel resources to lay the foundations for the next stage of Hibernia’s growth, as well as engaging in a substantial re-financing which will result in major interest savings in fiscal 2001. The operating loss for the year was marginally higher than that for fiscal 1999, however we have invested across all sectors of our business, particularly with respect to adding to our management team, separating our businesses into three operating units, recruitment of sales personnel, investment in product development and increased expenditure in marketing. We now have all of our structures in place, adequate production capacity to meet our sales projections and, most importantly, we have developed strong relationships with the major retailers in the UK, the benefits of which shall be reflected in fiscal 2001 and beyond”.
Colm Delves, Chief Financial Officer, said “As previously reported, during Quarter 4 of fiscal 2000 we completed a major financing in which a total of $33 million in equity was invested by a group of European Institutional investors, led by the Pan European Food Fund. These funds together with term financing at market rates provided by Fortis Bank, Acquisition Finance, were used to fully pre-pay US$40 million in Loan Notes plus accrued interest on April 20, 2000. The Loan Notes which were pre-paid bore cash interest of 12.5%, and an additional 5% coupon compounding semi-annually which was payable on maturity of the Notes. The Company was also prone to an exchange rate risk associated with these Notes and incurred an income statement charge with respect to the amortisation of the costs associated with the issuance of the Notes in 1998. This pre-payment is anticipated to reduce the Company’s annual interest charge by IR(pound)5.3 million ($6.5 million) from April 20, 2000 and has significantly improved the Company’s balance sheet.”
Sales for the quarter were IR(pound)21.38 million ($25.99 million), an increase of 12% compared to IR(pound)19.1 million ($23.16 million) for the similar three month period ended March 31, 1999.
The operating loss for quarter 4 amounted to IR(pound)3.61 million ($4.38 million) compared to an operating loss of IR(pound)0.94 million ($1.14 million) for the similar three month period ended March 31, 1999. The increase in the loss was principally attributable to increased overhead costs arising from the Company’s investment in personnel throughout the business, together with the overhead costs associated with the new ready-meals facility which commenced operations in October, 1999.
The net loss for Quarter 4 amounted to IR(pound)6.0 million ($7.29 million) compared to a net loss of IR(pound)3.58 million ($4.35 million) for the similar three month period in 1999.
With respect to Quarter 4, Mr Murphy said “Notwithstanding the 12% year on year revenue increase in Quarter 4 the frozen desserts market in particular suffered somewhat due to an over-hang arising from the millennium, in that retailers were left with inventories of millennium party products which were not as successful as anticipated. Fortunately, however, the nature of the millennium should mean that this situation will not arise again within our life time”.
Hibernia Foods plc is a leading manufacturer of branded cakes and branded ready-meals, and private-label frozen desserts, ready-meals and savory products, headquartered in Dublin, Ireland, with significant manufacturing facilities in the North East and South West of England. It is the exclusive European license holder for Entenmann’s branded sweet-baked cakes throughout all of geographical Europe, representing 52 countries and a population of over 700 million people.
HIBERNIA FOODS PLC AND SUBSIDIARIES
Summary Consolidated Statements
of Operations for the
Quarter Ended March 31,
2000(1) 2000 1999
US$000s IR(pound)000s IR(pound)000s
Product Revenue 25,988 21,379 19,056
Gross Profit 2,843 2,339 3,093
Operating Expenses (7,228) (5,946) (4,034)
Operating Profit / (Loss) (4,385) (3,607) (941)
Interest, Foreign Exchange and
Other charges (2,905) (2,390) (2,639)
Net Profit / (Loss) (7,290) (5,997) (3,580)
Profit/(Loss) per Share Data for the
Quarter Ended March 31,
2000(1) 2000 1999
US$ IR(pound) IR(pound)
--- --------- ---------
Basic Profit/(Loss) per Share (0.61) (0.50) (0.48)
Weighted Average Ordinary
Shares Outstanding 11,888,308 11,888,308 7,449,961
HIBERNIA FOODS PLC AND SUBSIDIARIES
Summary Consolidated
Balance Sheets as of March 31,
2000(1) 2000 1999
US$000s IR(pound)000s IR(pound)000s
Total Current Assets 72,463 59,611 29,091
Total Fixed Assets 46,239 38,112 31,925
Total Intangible & Other Assets 10,419 8,571 8,909
Total Assets 129,211 106,294 69,925
Total Current Liabilities 51,843 42,648 23,101
Other Liabilities 48,965 40,280 38,772
Total Liabilities 100,808 82,928 61,873
Net Assets 28,403 23,366 8,052
HIBERNIA FOODS PLC AND SUBSIDIARIES
Summary Consolidated Statements
of Operations for the
Year Ended March 31,
2000(1) 2000 1999
US$000s IR(pound)000s IR(pound)000s
Product Revenue 109,413 90,007 64,240
Gross Profit 18,030 14,832 10,038
Operating Expenses (21,208) (12,234) (5,290)
Operating Profit/(Loss) (3,178) (2,614) (2,196)
Interest, Foreign Exchange
and Other charges (9,462) (7,784) (5,715)
Net (Loss) (12,640) (10,398) (7,911)
Loss per Share Data for the
Fiscal Year Ended March 31,
2000(1) 2000 1999
US$ IR(pound) IR(pound)
Basic (Loss) per Share (1.48) (1.22) (1.10)
Weighted Average
Ordinary Shares Outstanding 14,094,674 14,094,674 7,449,961
(1) The summary financial information above is expressed in US
Dollars, solely for convenience, at the US Dollar rate of exchange
against the Irish pound at March 31, 2000 of IR(pound)1 =
US$1.2156
This report contains forward-looking statements based upon certain assumptions by management, some of which may not materialize, and unanticipated events may occur which could effect the business of Hibernia and the markets for their products. Forward-looking statements contained herein involve a number of risk and uncertainties including, but not limited to, economic, competitive, governmental and technological factors.
