Diamond Foods Inc. (DMND, Financial) filed Quarterly Report for the period ended 2011-01-31.
Diamond Foods Inc. has a market cap of $1.13 billion; its shares were traded at around $51.64 with a P/E ratio of 29.2 and P/S ratio of 1.7. The dividend yield of Diamond Foods Inc. stocks is 0.4%.
Advertising. Advertising expenses were $10.0 million and $22.4 million for the three and six months ended January 31, 2011 and $12.2 million and $18.4 million for the three and six months ended January 31, 2010. Advertising expenses as a percentage of net sales were 3.9% and 4.4% for the three and six months ended January 31, 2011 and 6.6% and 5.1% for the three and six months ended January 31, 2010. Advertising expenses for the three months ended January 31, 2010 included the production costs associated with four television commercials and the sponsorship of a college bowl game, which were not incurred in the current fiscal year. For the six months ended January 31, 2011, the increase in advertising, which we expect to continue throughout the fiscal year, was primarily due to increased media spending associated with the snack brands and incremental Kettle Foods brand support.
Interest expense, net. Net interest expense was $6.0 million and $12.1 million for the three and six months ended January 31, 2011 and $0.9 million and $2.2 million for the three and six months ended January 31, 2010. Net interest expense as a percentage of net sales was 2.3% and 2.4% for the three and six months ended January 31, 2011 and 0.5% and 0.6% for the three and six months ended January 31, 2010. The increase was primarily attributable to the borrowings used to fund the Kettle Foods acquisition.
During the six months ended January 31, 2011, cash provided by operating activities was $34.7 million compared to $10.5 million for the six months ended January 31, 2010. The increase in cash provided by operating activities was primarily due to improved profitability. Cash used in investing activities was $30.5 million during the six months ended January 31, 2011 compared to $4.2 million for the six months ended January 31, 2010. This increase was mainly due to investments in production machinery at our Stockton and Fishers facilities, as well as restricted cash to be used for our Beloit plant expansion. Cash used in financing activities during the six months ended January 31, 2011 was $7.7 million compared to $19.1 million for the six months ended January 31, 2010. The decrease was primarily attributable to the proceeds from issuance of long-term debt.
Our Secured Credit Facility consists of a $200 million revolving credit facility, of which $157.7 million was outstanding as of January 31, 2011, and a $400 million term loan facility, of which $370 million was outstanding as of January 31, 2011. Scheduled principal payments on the term loan are $40 million for fiscal year 2011 and each of the succeeding three years (due quarterly), and $10 million for each of the first two quarters in fiscal year 2015, with the remaining principal balance and any outstanding loans under the revolving credit facility to be repaid on the fifth anniversary of initial funding. Borrowings under the Secured Credit Facility will bear interest, at our option, at either the agents base rate or the LIBOR rate, plus a margin for LIBOR loans ranging from 2.25% to 3.50%, based on the consolidated leverage ratio which is defined as the ratio of total debt to EBITDA. Substantially all of our tangible and intangible assets are considered collateral security under the Secured Credit Facility.
Working capital and stockholders equity were $88.6 million and $428.7 million at January 31, 2011 compared to $72.2 million and $379.9 million at July 31, 2010 and $61.0 million and $197.2 million at January 31, 2010. The increase in working capital was due to increases in receivables and inventory related to the Kettle Foods acquisition and increases in raw material nut volume, offset by increases in current portion of long term debt, accounts payable and accrued liabilities.
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Diamond Foods Inc. has a market cap of $1.13 billion; its shares were traded at around $51.64 with a P/E ratio of 29.2 and P/S ratio of 1.7. The dividend yield of Diamond Foods Inc. stocks is 0.4%.
Highlight of Business Operations:
Net sales were $257.6 million and $510.2 million for the three and six months ended January 31, 2011. Net sales were $184.2 million and $364.8 million for the three and six months ended January 31, 2010. For the three and six months ended January 31, 2011, the increase in net sales was primarily due to strong snack sales (including Kettle Foods).Advertising. Advertising expenses were $10.0 million and $22.4 million for the three and six months ended January 31, 2011 and $12.2 million and $18.4 million for the three and six months ended January 31, 2010. Advertising expenses as a percentage of net sales were 3.9% and 4.4% for the three and six months ended January 31, 2011 and 6.6% and 5.1% for the three and six months ended January 31, 2010. Advertising expenses for the three months ended January 31, 2010 included the production costs associated with four television commercials and the sponsorship of a college bowl game, which were not incurred in the current fiscal year. For the six months ended January 31, 2011, the increase in advertising, which we expect to continue throughout the fiscal year, was primarily due to increased media spending associated with the snack brands and incremental Kettle Foods brand support.
Interest expense, net. Net interest expense was $6.0 million and $12.1 million for the three and six months ended January 31, 2011 and $0.9 million and $2.2 million for the three and six months ended January 31, 2010. Net interest expense as a percentage of net sales was 2.3% and 2.4% for the three and six months ended January 31, 2011 and 0.5% and 0.6% for the three and six months ended January 31, 2010. The increase was primarily attributable to the borrowings used to fund the Kettle Foods acquisition.
During the six months ended January 31, 2011, cash provided by operating activities was $34.7 million compared to $10.5 million for the six months ended January 31, 2010. The increase in cash provided by operating activities was primarily due to improved profitability. Cash used in investing activities was $30.5 million during the six months ended January 31, 2011 compared to $4.2 million for the six months ended January 31, 2010. This increase was mainly due to investments in production machinery at our Stockton and Fishers facilities, as well as restricted cash to be used for our Beloit plant expansion. Cash used in financing activities during the six months ended January 31, 2011 was $7.7 million compared to $19.1 million for the six months ended January 31, 2010. The decrease was primarily attributable to the proceeds from issuance of long-term debt.
Our Secured Credit Facility consists of a $200 million revolving credit facility, of which $157.7 million was outstanding as of January 31, 2011, and a $400 million term loan facility, of which $370 million was outstanding as of January 31, 2011. Scheduled principal payments on the term loan are $40 million for fiscal year 2011 and each of the succeeding three years (due quarterly), and $10 million for each of the first two quarters in fiscal year 2015, with the remaining principal balance and any outstanding loans under the revolving credit facility to be repaid on the fifth anniversary of initial funding. Borrowings under the Secured Credit Facility will bear interest, at our option, at either the agents base rate or the LIBOR rate, plus a margin for LIBOR loans ranging from 2.25% to 3.50%, based on the consolidated leverage ratio which is defined as the ratio of total debt to EBITDA. Substantially all of our tangible and intangible assets are considered collateral security under the Secured Credit Facility.
Working capital and stockholders equity were $88.6 million and $428.7 million at January 31, 2011 compared to $72.2 million and $379.9 million at July 31, 2010 and $61.0 million and $197.2 million at January 31, 2010. The increase in working capital was due to increases in receivables and inventory related to the Kettle Foods acquisition and increases in raw material nut volume, offset by increases in current portion of long term debt, accounts payable and accrued liabilities.
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