MARION, N.Y., Oct. 27, 2011 /PRNewswire/ -- Seneca Foods
Corporation (NASDAQ: SENEA, SENEB) reported that net earnings for
the fiscal second quarter of 2012 was $2.9
million, or $0.24 per diluted
share, compared to $2.8 million, or
$0.23 per diluted share, in the
fiscal second quarter of 2011. Net sales for the second
quarter ended October 1, 2011
increased from the second quarter ended October 2, 2010 by 3.0%, to $283.6 million. The increase is
attributable to higher selling prices and a more favorable sales
mix of $24.5 million partially offset
by decreased sales volume of $16.4
million.
For the six months ended October 1,
2011, net sales increased $47.3
million, or 9.5% to $542.7
million. The increase is attributable to higher selling
prices and a more favorable sales mix of $23.9 million and increased sales volume of
$23.4 million. Net loss for the
first six months of fiscal 2012 was $5.1
million, or $0.42 per diluted
share, compared to net earnings of $8.1
million, or $0.66 per diluted
share, in the first six months of fiscal 2011.
Excluding a non-cash after-tax LIFO charge of $8.3 million, net earnings per diluted share were
$0.91 during the quarter ended
October 1, 2011 versus $0.20 during the quarter ended October 2, 2010, which included a non-cash LIFO
credit of $0.4 million.
Excluding a non-cash after-tax LIFO charge of $12.5 million, net earnings per diluted share
were $0.61 during the six months
ended October 1, 2011, compared to
$0.41 during the six months ended
October 2, 2010 which included a
non-cash LIFO credit of $3.1
million.
"The improved earnings performance in the quarter reflects the
fact that our inventories are in a much more balanced position than
prior year heading into the holiday season," said Kraig H. Kayser, President and CEO. He
added, "The swing to higher LIFO charges is a reflection of
significant increases in the cost of fuel, steel, and produce which
are three primary cost inputs to our inventories."
Earnings Conference Call and Webcast
The Company will host a conference call to discuss second
quarter fiscal year 2012 financial results tomorrow at 8:00 AM EDT. The conference call can be
accessed live over the phone by dialing (800) 926-9853. If you are
unable to listen to the live conference call, a replay will be
available on Monday, October 31,
2011, please visit www.senecafoods.com and click on "Company
Profile" and then "Investor Information". This replay will be
available for two weeks.
About Seneca Foods Corporation
Seneca Foods is a processor of canned fruits and vegetables with
manufacturing facilities located throughout the United States. Its products are sold under
the Libby's, Aunt Nellie's Farm Kitchen, Stokely's, READ, Seneca
Farms and Seneca labels as well as
through the private label and industrial markets. In addition,
under an alliance with General Mills Operations, LLC, 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, LLC under
the Green Giant label. Seneca's
common stock is traded on the Nasdaq Global Stock Market under the
symbols "SENEA" and "SENEB". SENEA is included the S&P SmallCap
600, Russell 2000 and Russell 3000 indices.
Non-GAAP Financial Measures—Net Earnings Excluding
LIFO Impact, EBITDA and FIFO EBITDA
Net Earnings excluding LIFO, EBITDA and FIFO EBITDA are non-GAAP
financial measures. The Company believes these non-GAAP financial
measures provide a basis for comparison to companies that do not
use LIFO and enhance the understanding of the Company's historical
operating performance. The Company does not intend for this
information to be considered in isolation or as a substitute for
other measures prepared in accordance with GAAP.
Set forth below is a reconciliation of reported net earnings and
reported diluted earnings per share to net earnings excluding LIFO
and diluted earnings per share excluding LIFO.
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Quarter
Ended
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October 1,
2011
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October 2,
2010
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Income
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Diluted
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Income
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Diluted
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(in
millions)
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EPS
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(in
millions)
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EPS
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Net earnings, as
reported:
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$
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2.9
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$
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0.24
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$
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2.8
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$
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0.23
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LIFO charge (credit) , after tax
at statutory federal rate
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$
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8.3
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$
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0.67
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$
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(0.4)
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$
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(0.03)
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Net earnings, excluding LIFO
impact
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$
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11.2
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$
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0.91
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$
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2.4
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$
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0.20
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Diluted weighted average
common shares outstanding
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(in
thousands)
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11,737
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11,736
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Six Months
Ended
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October 1,
2011
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October 2,
2010
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Income
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Diluted
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Income
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Diluted
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(in
millions)
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EPS
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(in
millions)
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EPS
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Net (loss) earnings, as
reported:
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$
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(5.1)
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$
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(0.42)
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$
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8.1
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$
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0.66
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LIFO charge (credit), after tax
at statutory federal rate
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$
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12.5
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$
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1.03
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$
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(3.1)
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$
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(0.25)
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Net earnings, excluding LIFO
impact
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$
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7.4
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$
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0.61
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$
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5.0
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$
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0.41
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Diluted weighted average
common shares outstanding
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(in
thousands)
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11,736
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11,392
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Set forth below is a reconciliation of reported net earnings to
EBITDA and FIFO EBITDA (earnings before interest, income taxes,
depreciation, amortization, non-cash charges and credits related to
the LIFO inventory valuation method). The Company does not intend
for this information to be considered in isolation or as a
substitute for other measures prepared in accordance with GAAP.
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Six Months
Ended
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EBITDA and FIFO
EBITDA:
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October 1,
2011
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October 2,
2010
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(In
thousands)
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Net (loss) earnings
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$
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(5,092)
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$
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8,086
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Income taxes (benefit)
expense
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(2,748)
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1,929
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Interest expense, net of
interest income
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3,666
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4,176
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Depreciation and
amortization
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11,188
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11,050
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Interest amortization
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(213)
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(243)
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EBITDA
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6,801
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24,998
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LIFO charge (credit)
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19,281
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(4,777)
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FIFO EBITDA
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$
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26,082
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$
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20,221
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Forward-Looking Information
The information contained in this release contains, or may
contain, forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. These
statements appear in a number of places in this release and include
statements regarding the intent, belief or current expectations of
the Company or its officers (including statements preceded by,
followed by or that include the words "believes," "expects,"
"anticipates" or similar expressions) with respect to various
matters.
Because such statements are subject to risks and uncertainties,
actual results may differ materially from those expressed or
implied by such forward-looking statements. Investors are
cautioned not to place undue reliance on such statements, which
speak only as of the date the statements were made. Among the
factors that could cause actual results to differ materially
are:
- general economic and business conditions;
- cost and availability of commodities and other raw materials
such as vegetables, steel and packaging materials;
- transportation costs;
- climate and weather affecting growing conditions and crop
yields;
- availability of financing;
- leverage and the Company's ability to service and reduce its
debt;
- foreign currency exchange and interest rate fluctuations;
- effectiveness of the Company's marketing and trade promotion
programs;
- changing consumer preferences;
- competition;
- product liability claims;
- the loss of significant customers or a substantial reduction in
orders from these customers;
- changes in, or the failure or inability to comply with,
United States, foreign and local
governmental regulations, including environmental and health and
safety regulations; and
- other risks detailed from time to time in the reports filed by
the Company with the SEC.
Except for ongoing obligations to disclose material information
as required by the federal securities laws, the Company does not
undertake any obligation to release publicly any revisions to any
forward-looking statements to reflect events or circumstances after
the date of the filing of this report or to reflect the occurrence
of unanticipated events.
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Seneca Foods
Corporation
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Unaudited
Condensed Consolidated Statements of Net Earnings
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For the
Periods Ended October 1, 2011 and October 2, 2010
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(In
thousands of dollars, except share data)
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Quarter
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Year-to-Date
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Fiscal
2012
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Fiscal
2011
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Fiscal
2012
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Fiscal
2011
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Net sales
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$
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283,616
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$
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275,448
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$
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542,699
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$
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495,390
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Plant restructuring (income)
expense (note 3)
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$
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(15)
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$
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1,211
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$
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39
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$
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1,211
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Other operating income, net
(note 4)
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$
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(18)
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$
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(8)
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$
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(169)
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$
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(84)
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Operating income (loss)
(notes 1 and 2)
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$
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5,977
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$
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4,070
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$
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(4,174)
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$
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14,191
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Interest expense, net
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1,880
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2,240
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3,666
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4,176
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Earnings (loss) before income
taxes
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$
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4,097
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$
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1,830
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$
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(7,840)
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$
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10,015
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Income taxes expense (benefit)
(note 5)
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1,214
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(981)
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(2,748)
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1,929
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Net earnings (loss)
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$
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2,883
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$
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2,811
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$
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(5,092)
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$
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8,086
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Earnings (loss) attributable to
common stock (note 6)
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$
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2,779
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$
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2,709
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$
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(4,930)
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$
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7,571
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Basic earnings (loss) per
share
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$
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0.24
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$
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0.23
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$
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(0.42)
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$
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0.66
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Diluted earnings (loss) per
share
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$
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0.24
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$
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0.23
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$
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(0.42)
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$
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0.66
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Weighted average shares
outstanding basic
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11,737,102
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11,735,631
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11,736,367
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11,392,281
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Weighted average shares
outstanding diluted
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11,808,150
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11,806,710
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11,807,415
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11,463,360
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Note 1: The effect of the
LIFO inventory valuation method on second quarter pre-tax results
was to reduce operating earnings by $12,754,000 and
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increase operating earnings $645,000 for the three
month periods ended October 1, 2011 and October 2, 2010,
respectively.
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Note 2: The effect of the
LIFO inventory valuation method on year-to-date pre-tax results was
to reduce operating earnings by $19,281,000 for the
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six month period ended October 1, 2011 and increase
operating earnings by $4,777,000, for the six month period ended
October 2, 2010.
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Note 3: The three month periods
ended October 1, 2011 and October 2, 2010 include a restructuring
adjustment for severance costs of a $15,000 credit
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and $1,211,000 charge, respectively. The six
month periods ended October 1, 2011 and October 2, 2010 include a
restructuring charge
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for severance costs of $39,000 and $1,211,000,
respectively.
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Note 4: Other income for the
current year of $169,000 represents a gain on the sale of unused
fixed assets.
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Other income for the prior year of $84,000 represents
a gain on the sale of unused fixed assets.
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Note 5: The quarter and
year-to-date ended October 2, 2010 includes a tax benefit of
$1,519,000 mostly related to the settlement of an
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audit of fiscal years 2006, 2007, and 2008 with
the Internal Revenue Service.
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Note 6: The Company uses the
"two-class" method for basic earnings per share by dividing the
earnings attributable to common shareholders
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by the weighted average of common shares
outstanding during the period. The diluted earnings per share
includes the effect
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of convertible shares for the each period
presented. Average common and participating shares totaled
12,150,982 as of
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October 1, 2011.
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SOURCE Seneca Foods Corporation