Lance Inc. (LNCE, Financial) filed Quarterly Report for the period ended 2009-03-28.
Lance Inc. manufactures markets and distributes a variety of branded and private label snack foods and bakery products. Products include branded sandwich crackers sandwich cookies restaurant crackers and bread basket items candy chips meat snacks nuts and private label cookies and crackers. Products are packaged as individual single servings and as larger packages or multi-pack configurations and are distributed to grocery stores convenience stores vending machines food service institutions and through ``up and down the street`` outlets . Lance Inc. has a market cap of $724.2 million; its shares were traded at around $22.7 with a P/E ratio of 37.9 and P/S ratio of 0.9. The dividend yield of Lance Inc. stocks is 2.8%.
In November 2006, we entered into an interest rate swap agreement on $35 million of debt in order to fix the interest rate at 4.99%, plus applicable margin. The applicable margin on March 28, 2009, was 0.50%. The fair value of the interest rate swap liability was $3.2 million and $3.3 million on March 28, 2009 and December 27, 2008, respectively.
In July 2008, we entered into an interest rate swap agreement on an additional $15 million of debt in order to fix the interest rate at 3.87%, plus applicable margin. The applicable margin on this agreement on March 28, 2009, was 0.50%. The fair value of the interest rate swap liability was $1.0 million on March 28, 2009 and December 27, 2008.
In February 2009, we entered into an interest rate swap agreement on an additional $15 million of debt in order to fix the interest rate at 1.68%, plus applicable margin. The applicable margin on this agreement on March 28, 2009, was 0.40%. The fair value of the interest rate swap liability was $0.1 million on March 28, 2009.
Due to foreign currency fluctuations during the first quarters of 2009 and 2008, we recorded losses of $0.9 million and $3.0 million, respectively, in other comprehensive income because of the translation of the subsidiarys financial statements into U.S. dollars.
We are exposed to credit risks related to our accounts receivable. We perform ongoing credit evaluations of our customers to minimize the potential exposure. For the first quarter of 2009, net bad debt expense was $0.7 million primarily due to customer bankruptcies. Net bad debt expense was less than $0.1 million for the first quarter of 2008. Allowances for doubtful accounts were $1.3 million at March 28, 2009 and $0.9 million at December 27, 2008.
Read the The complete ReportLNCE is in the portfolios of John Keeley of Keeley Fund Management.
Lance Inc. manufactures markets and distributes a variety of branded and private label snack foods and bakery products. Products include branded sandwich crackers sandwich cookies restaurant crackers and bread basket items candy chips meat snacks nuts and private label cookies and crackers. Products are packaged as individual single servings and as larger packages or multi-pack configurations and are distributed to grocery stores convenience stores vending machines food service institutions and through ``up and down the street`` outlets . Lance Inc. has a market cap of $724.2 million; its shares were traded at around $22.7 with a P/E ratio of 37.9 and P/S ratio of 0.9. The dividend yield of Lance Inc. stocks is 2.8%.
Highlight of Business Operations:
In order to fix a portion of our ingredient and packaging costs, we have entered into forward purchase agreements with certain suppliers based on market prices, forward price projections, and expected usage levels in order to determine appropriate selling prices for our products. Purchase commitments for inventory decreased from $95.2 million as of December 27, 2008, to $90.7 million as of March 28, 2009, due to normal usage and the volume and mix of contracted ingredients. We are currently contracted at least six months in advance for all major ingredients and packaging.In November 2006, we entered into an interest rate swap agreement on $35 million of debt in order to fix the interest rate at 4.99%, plus applicable margin. The applicable margin on March 28, 2009, was 0.50%. The fair value of the interest rate swap liability was $3.2 million and $3.3 million on March 28, 2009 and December 27, 2008, respectively.
In July 2008, we entered into an interest rate swap agreement on an additional $15 million of debt in order to fix the interest rate at 3.87%, plus applicable margin. The applicable margin on this agreement on March 28, 2009, was 0.50%. The fair value of the interest rate swap liability was $1.0 million on March 28, 2009 and December 27, 2008.
In February 2009, we entered into an interest rate swap agreement on an additional $15 million of debt in order to fix the interest rate at 1.68%, plus applicable margin. The applicable margin on this agreement on March 28, 2009, was 0.40%. The fair value of the interest rate swap liability was $0.1 million on March 28, 2009.
Due to foreign currency fluctuations during the first quarters of 2009 and 2008, we recorded losses of $0.9 million and $3.0 million, respectively, in other comprehensive income because of the translation of the subsidiarys financial statements into U.S. dollars.
We are exposed to credit risks related to our accounts receivable. We perform ongoing credit evaluations of our customers to minimize the potential exposure. For the first quarter of 2009, net bad debt expense was $0.7 million primarily due to customer bankruptcies. Net bad debt expense was less than $0.1 million for the first quarter of 2008. Allowances for doubtful accounts were $1.3 million at March 28, 2009 and $0.9 million at December 27, 2008.
Read the The complete ReportLNCE is in the portfolios of John Keeley of Keeley Fund Management.
