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AMERICAN ITALIAN PASTA COMPANY |NEWS
|RELEASE
Contact:
Paul Geist
Vice President & Corporate Controller
816-584-5611
For Immediate Release
|  |
AMERICAN ITALIAN PASTA COMPANY PROVIDES CERTAIN
LIQUIDITY AND REVENUE INFORMATION AND UPDATES
RESTATEMENT PROCESS
KANSAS CITY, MO, February 2, 2007 - American Italian Pasta Company (AITP.PK),
the largest producer and marketer of dry pasta in North America, today provided
certain liquidity and revenue information. The Company also updated its progress
in completing the restatement of its historical financial statements.
LIQUIDITY
For the first quarter of fiscal 2007, ending on December 29, 2006, the Company
had total liquidity resources of $50.5 million, consisting of cash on hand of
$22.8 million and $27.7 million available under the Company's $30.0 million
revolving credit facility.
Total debt outstanding on December 29, 2006 was $254.3 million. Total debt, net
of cash, was $231.5 million, compared to $239.3 million as of September 29,
2006, the Company's fiscal year end, reflecting a reduction in net debt of $7.8
million in the first quarter of fiscal 2007.
For the fiscal quarter ended December 29, 2006, the Company's cash flows
included the following items of significance: receipt of $3.0 million in
anti-dumping income from the U.S. government under the Continued Dumping and
Subsidy Offset Act of 2000; net cash interest of $7.5 million; cash taxes of
$0.2 million; capital expenditures of $1.5 million; professional fees of $2.5
million relating to the Audit Committee investigation, shareholder litigation
and related matters; and management consulting fees of $0.5 million.
The Company noted that all historical liquidity amounts outlined above are
unaudited and are subject to adjustments resulting from the continuing,
previously announced Audit Committee investigation.
American Italian Pasta Co.
February 2, 2007
Page 2
REVENUE INFORMATION
As previously announced, the Company has changed its reporting of revenues
regarding certain promotional expenses, treating them as a reduction in revenue
as opposed to selling and marketing expense on the Company's statements of
operations. While this reclassification reduces reported revenues, it does not
change reported net income (loss). With this reclassification, total revenues
for the first fiscal quarter ending December 29, 2006 were $94.0 million
compared to $93.7 million in the first fiscal quarter ended December 30, 2005,
reflecting an increase of 0.3% in revenue compared to the previous fiscal year's
quarter. Overall volume decreased 3.1% during the quarterly period, as compared
to the previous fiscal year's quarter. Excluding liquidation sales of $0.01
million and $0.7 million in the first quarter of fiscal years 2007 and 2006,
respectively, revenue increased 1.0% and volume decreased 1.6% in the first
quarter of fiscal 2007 compared to the previous fiscal year's quarter. The
Company has previously noted that it had significant obsolete inventory from
prior periods and believes that providing the revenue and volume information
excluding the sale of this inventory provides additional information regarding
the Company's ongoing operations.
The Company also noted that all historical revenue amounts outlined above are
unaudited and are subject to adjustments, including adjustments related to
promotional expenses, accounting period cutoff, and other related revenue
recognition issues resulting from the continuing, previously announced Audit
Committee investigation.
RESTATEMENT UPDATE
The Company is in the process of completing its review of all identified issues,
completing the preparation of its internal financial statements, drafting its
required filings for fiscal year ended September 30, 2005, and working with our
independent auditors to complete the restatement process. As previously
announced, the Company has been applying all available internal resources and
has retained outside assistance to complete its required filings, including the
Company's annual report on Form 10-K for fiscal year ended September 30, 2005.
The Company is working to complete this process as soon as practicable.
ABOUT AIPC
Founded in 1988 and based in Kansas City, Missouri, American Italian Pasta
Company is the largest producer and marketer of dry pasta in North America. The
Company has four plants that are located in Excelsior Springs, Missouri;
Columbia, South Carolina; Tolleson, Arizona and Verolanuova, Italy. The Company
has approximately 600 employees located in the United States and Italy.
When used in this release, the words "anticipate," "believe," "estimate," and
"expect" and similar expressions are intended to identify forward-looking
statements, but are not
American Italian Pasta Co.
February 2, 2007
Page 3
the exclusive means of identifying these statements. The statements by the
Company regarding the expected liquidity position and revenues for the first
fiscal quarters of 2006 and 2007 and the full year of fiscal year 2006 are
forward-looking. Actual results or events could differ materially. The
differences could be caused by a number of factors, including, but not limited
to, the completion and findings of the Audit Committee investigation, the
Company's review of its financial statements, a review and/or audit of the
Company's financial statements by its independent registered public accounting
firm, the SEC staff review, and the conclusions reached regarding financial
reporting. The Company will not update any forward-looking statements in this
press release to reflect future events.
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