Hibernia Foods plc (Nasdaq: HIBNY, HIBZF, HIBWF; the “Company”) today announced its results for the quarter ended June 30, 2000.
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– Reflects pre-payment of Loan Notes in April 2000
– IR(pound)2 million ($2.4 million) capital investment completed
– New Ready-Meals facility obtains major business
– Entenmann’s now the fastest growing cake brand in the UK
– New range of Entenmann’s Chilled Desserts launched
– Goal to achieve organic revenues of $150 million
– Potential acquisition opportunities being considered
Hibernia reported that revenues for the quarter ended June 30, 2000 were IR(pound)22.44 million ($27.13 million), an increase of 27% compared to IR(pound)17.71 million ($21.41 million) for the comparative three month period ended June 30, 1999. Revenues across the Company’s three divisions, frozen desserts, frozen ready-meals and Entenmann’s all showed double digit percentage growth.
Gross Profit increased from IR(pound)2.36 million ($2.86 million) to IR(pound)3.2 million ($3.88 million) a year-on-year increase of 35.7%, which is principally attributable to higher sales and the benefit of incremental sales in relation to the fixed element of factory overheads.
The operating loss for the quarter amounted to IR(pound)1.27 million ($1.53 million) compared to an operating loss of IR(pound)1.17 million ($1.41 million) for the similar three month period ended June 30, 1999. The marginal increase in the operating loss was principally due to the increased overhead costs arising from the new ready-meals facility and the investment in senior management and sales personnel which was largely counter-acted by the increased gross margin.
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By GlobalDataNet loss before extraordinary item was 31.7% lower than the same period in fiscal 2000, which was due to the lower interest and related costs in the current fiscal compared to the same period in fiscal 1999, arising from the pre-payment of the $40 million Loan Notes on April 20th 2000.
The extraordinary item in the most recently concluded quarter related to a one time, non-recurring charge of IR(pound)3.7 million ($4.5 million) principally due to the write-off of previously capitalised deferred issuance costs in relation to the pre-paid Loan Notes.
Loss per share (before extraordinary item) was IR(pound)0.18 ($0.22) compared to a loss per share of IR(pound)0.49 ($0.59) for the same period in fiscal 2000.
The Company also invested approximately IR(pound)2 million ($2.4 million) in expanding one of its frozen dessert facilities which is anticipated to increase production capacity by approximately IR(pound)10 million ($12 million). This investment was made principally in connection with a major private-label cheesecake contract which Hibernia recently secured and sales of these new products commenced in June, 2000.
Also in June of Quarter 1, the Company’s new ready-meal facility commenced production of chicken and beef private-label platter meals for the UK’s largest retailer, Tesco, which has annual revenues of approximately Stg(pound)18.8 billion ($28 billion). This business is phase one of a three phase product launch which will occur in fiscal 2001. The Company has also secured private label ready-meals business with Safeway and Somerfield which will be launched in the second half of the current fiscal.
The exceptional growth in sales of the Entenmann’s product range, which demonstrated double digit revenue growth both in fiscal 2000 and in the quarter ended June 30,2000, has been to such an extent that the latest 12 week Taylor Nelson Sofres independent market data has confirmed that the Entenmann’s brand is now the fastest growing cake brand in the UK.
Hibernia also announced that it had extended its Entenmann’s product range to include three new chilled products which were being launched in Quarter 2. These consist of New York style cheesecakes and a carrot passion cake. This new product range will broaden the market for Entenmann’s as it will be prominently featured in retailers’ refrigerated cabinets, and is expected to further accelerate the growth of the Entenmann’s brand.
Commenting on the results, Oliver Murphy, Chairman and Chief Executive Officer, said “I am very pleased with our first quarter’s results. We have shown substantial revenue and gross margin growth, in what is typically our lowest revenue quarter of the year due to the seasonality of our business. Our net loss before the once-off exceptional item was 31.7% lower than the same period last year and I am very encouraged by our aggressive growth with the major UK retailers which was only partially reflected in Quarter 1 as new business revenues were reflected for only part of the quarter. I am confident that our revenue and margin growth will continue at an even higher level throughout the current fiscal returning the Company to profitability.”
He continued by saying, “Our strategic goals in the current fiscal are to increase core revenues to $150 million, improve margins and return the Company to profitability. We invested heavily in fiscal 2000 with respect to personnel, product development and facilities with the purpose of achieving these objectives and the first quarter’s results are broadly in line with our own internal plan.”
With respect to acquisitions, Mr Murphy said, “There is a lot of activity in the market at present and we have identified a number of opportunities which we are currently investigating, both in the UK and also in mainland Europe. Whilst we are still at a very early stage in relation to this process we hope to bring at least one accretive acquisition to fruition within the current fiscal.”
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 June 30,
2000(1) 2000 1999
US$000s IR(pound)000s IR(pound)000s
------- ------------- -------------
Product Revenue 27,129 22,443 17,711
Gross Profit 3,878 3,208 2,364
Operating Expenses (5,409) (4,475) (3,532)
Operating Profit / (Loss) (1,531) (1,267) (1,168)
Interest, Foreign Exchange
and Other charges (1,507) (1,247) (2,512)
Net Profit / (Loss) Before
Extraordinary Item (3,038) (2,514) (3,680)
Extraordinary Item (4,520) (3,739) (3,680)
Net Profit / (Loss) After
Extraordinary Item (7,558) (6,253) (3,680)
Profit/(Loss) per Share Data for the
Quarter Ended June 30th,
2000(1) 2000 1999
US$ IR(pound) IR(pound)
--- --------- ---------
Basic Profit/(Loss) per Share
(Before Extraordinary Item) (0.22) (0.18) (0.49)
Basic Profit/(Loss) per Share
(After Extraordinary Item) (0.54) (0.44) (0.49)
Weighted Average Ordinary
Shares Outstanding 14,101,901 14,101,901 7,449,961
HIBERNIA FOODS PLC AND SUBSIDIARIES
Summary Consolidated
Balance Sheets as of June 30,
2000(1) 2000 1999
US$000s IR(pound)000s IR(pound)000s
------- ------------- -------------
Total Current Assets 39,377 32,575 27,275
Total Fixed Assets 45,795 37,885 32,251
Total Intangible & Other Assets 5,984 4,950 8,931
Total Assets 91,156 75,410 68,457
Total Current Liabilities 61,378 50,776 24,683
Other Liabilities 10,264 8,491 39,266
Total Liabilities 71,642 59,267 63,949
Net Assets 19,514 16,143 4,508
(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 June 30, 2000 of IR(pound)1 =
US$1.2088
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.
