Seneca Foods Corp. (SENEA, Financial) filed Quarterly Report for the period ended 2009-12-26.
Seneca Foods Corp. has a market cap of $228.6 million; its shares were traded at around $27.04 with and P/S ratio of 0.2. SENEA is in the portfolios of Ron Baron of Baron Funds, Chuck Royce of ROYCE & ASSOCIATES.
Net sales for the nine months ended December 26, 2009 were $1,000.8 million, which represents a 0.5%, or $5.3 million, increase from the nine months ended December 27, 2008. The increase in sales is attributable to increased selling prices/improved sales mix of $48.3 million partially offset by reduced sales volume of $43.0 million. The increase in sales is primarily from an $8.1 million increase in Green Giant Alliance sales, a $7.2 million increase in Snack sales and an $8.6 million increase in Canned Vegetable sales partially offset by a $17.2 million decrease in Canned Fruit sales.
Basic earnings per share were $1.53 and $1.14 for the three months ended December 26, 2009 and December 27, 2008, respectively. Diluted earnings per share were $1.52 and $1.13 for the three months ended December 26, 2009 and December 27, 2008, respectively. Basic earnings per share were $3.47 and $1.33 for the nine months ended December 26, 2009 and December 27, 2008, respectively. Diluted earnings per share were $3.44 and $1.32 for the nine months ended December 26, 2009 and December 27, 2008, respectively. For details of the calculation of these amounts, refer to footnote 11 of the Notes to Condensed Consolidated Financial Statements.
As shown in the Condensed Consolidated Statements of Cash Flows, net cash used in operating activities was $55.9 million in the first nine months of fiscal 2010, compared to net cash used in operating activities of $34.7 million in the first nine months of fiscal 2009. The $21.2 million increased cash usage is primarily attributable to increased inventory of $151.7 million (exclusive of off-season reserve) in the first nine months of fiscal 2010 as compared to $92.6 million increase in inventory in the first nine months of fiscal 2009 and a $16.6 million decrease in cash provided by accounts payable, accrued expenses and other liabilities as compared to the first nine months of December 27, 2008 partially offset by increased net earnings of $26.0 million as previously discussed, and a $37.4 million increase in cash provided by accounts receivable as compared to the first nine months of December 27, 2008. The inventory increase is due to higher steel costs and the timing of certain raw material purchases.
As compared to December 27, 2008, inventory increased $56.4 million. The components of the inventory increase reflect a $43.5 million increase in finished goods (net of the off-season reserve), a $4.8 million increase in work in process and $8.1 million increase in raw materials and supplies. The finished goods increase reflects higher inventory quantities attributable to increased production during the harvest season and decreased sales volume as compared to prior year. FIFO based inventory costs exceeded LIFO based inventory costs by $99.9 million as of the end of the third quarter of 2010 as compared to $70.0 million as of the end of the third quarter of 2009. The work in process and raw materials increases are primarily due to an increase in cans and raw steel quantities over the prior year. The off-season reserve increased by $8.5 million, as compared to December 2008, due to the timing of the seasonal pack and certain expenses. Refer to the Critical Accounting Policies section of this Form 10-Q for further details on the off-season reserve.
Cash provided by financing activities was $82.9 million in the first nine months of fiscal 2010, which included borrowings of $422.0 million and the repayment of $339.5 million of long-term debt principally consisting of borrowing and repayment on the revolving credit facility (“Revolver”). The $30.1 million year-over-year increase in net cash provided by financing activities is primarily related to the $56.4 million increase in inventory discussed above. During the third quarter of fiscal 2010, the Company entered into some interim lease notes which financed down payments for various equipment leases at market rates. As of December 26, 2009, some of these interim notes had not been converted into operating lease schedules since the equipment was either not delivered or fully installed. These notes, which total $13.2 million as of December 26, 2009, are included under notes payable in the accompanying Condensed Consolidated Balance Sheets. These notes are expected to be converted into lease schedules by the Company s fiscal year end. There was no new long-term debt.
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Seneca Foods Corp. has a market cap of $228.6 million; its shares were traded at around $27.04 with and P/S ratio of 0.2. SENEA is in the portfolios of Ron Baron of Baron Funds, Chuck Royce of ROYCE & ASSOCIATES.
Highlight of Business Operations:
Third fiscal quarter 2010 results include net sales of $447.0 million, which represents a 3.5% decrease, or $16.3 million, from the third quarter of fiscal 2009. The decrease in sales is attributable to a sales volume reduction of $19.0 million partially offset by increased selling prices/improved sales mix of $2.7 million. The reduction in sales is predominately due to decreased sales to the U.S. Department of Agriculture. The decrease in sales is primarily from a $12.1 million decrease in Canned Vegetable sales and a $15.1 million decrease in Canned Fruit sales partially offset by a $12.3 million increase in Green Giant Alliance sales.Net sales for the nine months ended December 26, 2009 were $1,000.8 million, which represents a 0.5%, or $5.3 million, increase from the nine months ended December 27, 2008. The increase in sales is attributable to increased selling prices/improved sales mix of $48.3 million partially offset by reduced sales volume of $43.0 million. The increase in sales is primarily from an $8.1 million increase in Green Giant Alliance sales, a $7.2 million increase in Snack sales and an $8.6 million increase in Canned Vegetable sales partially offset by a $17.2 million decrease in Canned Fruit sales.
Basic earnings per share were $1.53 and $1.14 for the three months ended December 26, 2009 and December 27, 2008, respectively. Diluted earnings per share were $1.52 and $1.13 for the three months ended December 26, 2009 and December 27, 2008, respectively. Basic earnings per share were $3.47 and $1.33 for the nine months ended December 26, 2009 and December 27, 2008, respectively. Diluted earnings per share were $3.44 and $1.32 for the nine months ended December 26, 2009 and December 27, 2008, respectively. For details of the calculation of these amounts, refer to footnote 11 of the Notes to Condensed Consolidated Financial Statements.
As shown in the Condensed Consolidated Statements of Cash Flows, net cash used in operating activities was $55.9 million in the first nine months of fiscal 2010, compared to net cash used in operating activities of $34.7 million in the first nine months of fiscal 2009. The $21.2 million increased cash usage is primarily attributable to increased inventory of $151.7 million (exclusive of off-season reserve) in the first nine months of fiscal 2010 as compared to $92.6 million increase in inventory in the first nine months of fiscal 2009 and a $16.6 million decrease in cash provided by accounts payable, accrued expenses and other liabilities as compared to the first nine months of December 27, 2008 partially offset by increased net earnings of $26.0 million as previously discussed, and a $37.4 million increase in cash provided by accounts receivable as compared to the first nine months of December 27, 2008. The inventory increase is due to higher steel costs and the timing of certain raw material purchases.
As compared to December 27, 2008, inventory increased $56.4 million. The components of the inventory increase reflect a $43.5 million increase in finished goods (net of the off-season reserve), a $4.8 million increase in work in process and $8.1 million increase in raw materials and supplies. The finished goods increase reflects higher inventory quantities attributable to increased production during the harvest season and decreased sales volume as compared to prior year. FIFO based inventory costs exceeded LIFO based inventory costs by $99.9 million as of the end of the third quarter of 2010 as compared to $70.0 million as of the end of the third quarter of 2009. The work in process and raw materials increases are primarily due to an increase in cans and raw steel quantities over the prior year. The off-season reserve increased by $8.5 million, as compared to December 2008, due to the timing of the seasonal pack and certain expenses. Refer to the Critical Accounting Policies section of this Form 10-Q for further details on the off-season reserve.
Cash provided by financing activities was $82.9 million in the first nine months of fiscal 2010, which included borrowings of $422.0 million and the repayment of $339.5 million of long-term debt principally consisting of borrowing and repayment on the revolving credit facility (“Revolver”). The $30.1 million year-over-year increase in net cash provided by financing activities is primarily related to the $56.4 million increase in inventory discussed above. During the third quarter of fiscal 2010, the Company entered into some interim lease notes which financed down payments for various equipment leases at market rates. As of December 26, 2009, some of these interim notes had not been converted into operating lease schedules since the equipment was either not delivered or fully installed. These notes, which total $13.2 million as of December 26, 2009, are included under notes payable in the accompanying Condensed Consolidated Balance Sheets. These notes are expected to be converted into lease schedules by the Company s fiscal year end. There was no new long-term debt.
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